Fifty years old, Fevicol is an example of a big, well recalled brand in a low-involvement category..
Now a Rs 500-crore white glue brand, Fevicol recently competed 50 years in the Indian market. On the eve of its golden jubilee, O&M, the agency handling the brand for nearly 37 years, created a new campaign reiterating the big idea about bonding through its ‘moustache' ad. The campaign tells the story of a girl who has a moustache attached to her face during a school play in her childhood, which stuck to her till death. Humorous advertising has been playing a key role in building the Fevicol brand but the ad spends from Pidilite Industries have been conservative (ranging between Rs 25 crore and Rs 30 crore annually). Beginning with the Haisha campaign and graduating to the ‘huddle image'of the Indian cricket team, the big idea about how ‘some bonds are as unbreakable as the ‘Fevicol bond' have paid dividends for Pidilite over the years. In a freewheeling interview, the usually reticent Managing Director of Pidilite, M. B. Parekh, outlines some of the recent initiatives taken by Pidilite to grow his company beyond Fevicol and entering new ‘do-it-yourself categories' such as car care with its latest acquisition through the Cyclo brand in the US. Some excerpts from his interview to BrandLine:
On the eve of Fevicol completing 50 years, how would you describe the brand's journey?
The journey has been guided by our desire to make the brand close to the customer. All the marketing activities for the brand, either at trade level or at carpenter level, or through the media, have been directed towards this objective. In the process we had to learn and innovate as we went along.
From an unknown brand in a low-involvement category, we have reached a stage where Fevicol consistently ranks very high among all the brands in India.
To what extent has O&M been responsible for building the brand over the years?
O&M has played a crucial role for almost 40 years in building the brand. It was O&M which suggested the Elephant logo be introduced above the Fevicol brand.
Also, the process of innovation has been triggered by continuous interaction with O&M. The two teams have been working very closely all these years.
Was it difficult in the initial years for Pidilite to create the white glue market in the country?
Initially, selling white glue was more like concept selling because the trade was used to glues based on natural products. Any concept selling like this is a difficult proposition and required patient working with the end users.
For the first 5-7 years the challenge before us was to make white glue the most preferred glue for making furniture.
Today Pidilite has a strong rural focus. How are you building your distribution in this market and what will be your rural marketing strategy for Fevicol?
For the last five years we have built up a separate team for selling in ‘rurban' markets. This is the market segment comprising population centres of 5,000 to 50,000. We have built up a separate dedicated distribution network and also a dedicated sales team for this segment. The mode of operation in the ‘rurban' market is different from that in our urban markets and involves a lot of product promotion activity.
Over the years Pidilite has acquired brands such as Ranipal and M-Seal and others. What have you been doing with them? Why have none of the acquired brands achieved the kind of equity Fevicol enjoys?
Over the years, we have acquired M-Seal, Steelgrip, Roff, Ranipal and so on. As far as M-Seal and Steelgrip are concerned, they are leading brands in the category of epoxy sealants and PVC insulation tape. These brands have grown considerably and are doing very well.
As far as Roff is concerned, it is the second brand after Dr. Fixit in the portfolio of construction chemicals. This brand has also grown and will be used mainly for our tiling solutions products in future.
As for Ranipal, it has not received the required attention from us because Pidilite does not have an adequate sales and distribution network in the FMCG segment.
Pidilite has also entered the car care market with Cyclo. How big is this market and what are your plans towards growing this market?
There is no accurate estimate for the market size of car care products. We estimate the market to be Rs 100 crore per annum and growing at a rapid rate. We expect to participate in this market and its growth prospects by offering suitable high quality products for different applications.
Considering 40 per cent of Pidilite's turnover continues to come from Fevicol, would you look at reducing the dependence on your flagship brand and hedging your risks with the rest of your portfolio of brands?
Over the years the contribution of Fevicol to Pidilite's turnover has come down from over 50 per cent to below 30 per cent. This has happened with our expanding the product portfolio in different segments.
Of late, your company has roped in senior professionals including former managers from big FMCG companies such as Hindustan Unilever Ltd. Do you expect outside professionals to run the company more efficiently and thereby move away from an image of being a family-run set-up?
In the recent years the company has inducted professionals to occupy very senior positions in the business divisions as well as functional areas. It is our objective to reduce the role of family members in operational matters and restrict it to strategic matters.
Pidilite has also forayed into the retail space with Hobby Ideas. How is this business faring and would you consider spinning it off as a separate company once it reaches a critical mass?
Currently the hobby ideas /retail project is at an early stage. We are in the process of learning various aspects of the retail trade and will take a suitable decision at a later stage.
Fevicol's new moustache campaign on the eve of completing 50 years is again emphasising the big idea of creating Fevicol-based bonding. Have you been stepping up ad spends in recent times? Did recessionary trends affect the company in the recent past?
Our ad spends are gradually increasing. However, in 2008-09 this expenditure was curtailed due to adverse economic conditions. The spending is expected to return to normal levels from the current year onwards.