Not many dominant market leader brands can claim growth in market share. Tata claims a 67 pc share among branded salts in India. What factors have driven growth for Tata Salt? How robust have y-o-y sales been?
We don’t like to use the word ‘dominant’ to describe ourselves. Tata Salt is a key player in the market contributing to the country’s mental health. When we started in 1983, we were the first ones to provide iodine in salt. The idea was to address goitre. Over the years, Tata Salt has been seen as a product that has delivered consistently on quality, taste and purity (because it is vacuum evaporated). Despite being a low involvement category, it has received a positive response from consumers. Our 30 years of positioning as a product relevant to the nation has kept us in the forefront. Each campaign of Tata Salt, be it functional or emotional, has added to the equity of the brand.
Yes, we definitely enjoy a strong position in the market with a 67 pc market combined share (of Tata Salt and i-Shakti) in the national branded market, and a 52 pc share for Tata Salt alone. Tata Salt’s volume growth has been at a compounded annual rate of 8 pc over the last three years.
Where is this growth coming from (geographies), and how has this reflected on market share growth?
We have always projected ourselves as a pan-India brand. We have a strong presence in North and West, but now we’ll be focusing on East and South. That’s where we think growth will come from because penetration of branded salt is lower. These markets are growing because people are shifting from local labels to regional and national brands and we are riding high on that change. Today, we form one-sixth of the 5.8 billion tonnes market. So, Tata Salt may have a 52 pc market share in the national branded salt category, but we still have a long way to go. We think that growth will come because the conversion from local labels will keep happening.
Is distribution the game changer? Does expansion lead to a direct impact on sales? 14 lakh outlets is your current reach. How is this growing? Are rural areas maximum potential areas for the branded salts category and Tata Salt?
A higher consumption is ensured only when your product reaches the target consumer. Therefore, distribution is really a game changer. Today, we reach people through 14 lakh outlets. In the next three to four years, we plan to take that number to 17 to 18 lakh outlets. We will have to penetrate deeper into rural areas now. Our current penetration is 48 pc in rural markets, 56 pc in urban areas and 68 pc in metros (approximately).
How does one set brand objectives for Tata Salt?
Our marketing objectives are very clear. We need to be the carrier of nutrition to all consumers we are targeting. Overall, we are trying to address the nutritional needs that salt can fulfill. You’ll always have specific marketing objectives. But we look at the larger picture.
How, in your view, has Tata Salt matured as a brand?
Thirty years ago, Tata Salt set out with a mission of iodising the country. If you look at the history of campaigns and their relevance you’ll observe that we started with functionality – communicating the purity and whiteness of the salt, then the attribute of free flowing salt came in, and then we spoke about the contribution of a pinch of salt (chutki bhar namak) in building a strong and healthy nation.
In 2003, we went a notch up with ‘Desh ka Namak’, moving away from functionality to the emotive level. That campaign portrayed how Tata Salt unites a heterogeneous country such as ours. The current campaign (May 2012) called ‘Mothers for Mother India’ celebrates the role of mothers in inculcating values in their children. We are high up on the curve of maturity.
Also, born in 1983, is it an ‘old’ brand that needs refreshing for a younger population?
We had undertaken a research project a few years ago which showed that while Tata Salt is seen as a legendary brand, it may not be seen as a modern brand. Therefore, we questioned ourselves on whether we are a forward-looking brand. That’s when we thought of having products relevant for a younger generation and launched Tata Salt Lite (October 2007). It has low sodium content and caters to a huge segment of people who are trying to address their lifestyle issues. Will this variant drive volume for us? Not really. But it’s not a question of volume as much as about how you engage with your customers through these products.
With health concerns, has salt consumption come down - at least in urban areas?
Not really. Somehow, salt becomes the first to get flogged - you can’t blame salt for everything.
We understand that lifestyles are changing, work pressures are changing, and we see the imbalance and how it is happening. We are not saying salt is not contributing to consumers’ health issues, but it’s one of the contributors. Research suggests that the health food category is growing at 15 pc and the snack food category is growing at the same rate. What do you make of these results? We have to be conscious of both and move ahead. But yes, excess salt is bad for health; we have to have the right balance.
How are you dealing with the changed perception towards salt among consumers?
People who work in the fields sweat a lot more than those who sit within AC cabins in offices; therefore, the former need more salt than the latter. We aim at providing the right quantity and the variant to the right consumer. We will do what’s good for the consumer. If you need low sodium salt, so be it, we will give you Tata Salt Lite. Similarly, if you need crystallised salt in a particular market, we should be able to provide you with that.
Which sub-brand contributes maximum to sales, and which is the fastest growing?
The product variants may not drive volumes for us in the near future. For instance, I don’t think Tata Salt Lite will replace Tata Salt in the next three years. People take time to change and adapt to things. Broadly, all sub-brands including the flavoured variants (Tata Salt Flavoritz) are doing well. Tata Salt Lite has got established, but it’s a slow moving category, and is slightly ahead of its time. So, Tata Salt is going to be at the forefront of all the offerings.
Which are the agencies you work with, and what have been the efforts on digital media? How important is digital for Tata Salt, the brand?
We have been working with Leo Burnett for a long time now. Madison is our media agency. For us every medium is important. What percentage of your budget and attention you would allocate to each one is the question. Today, digital might not be taking a significant part of our marketing budget. But digital will play its own role with time; we aren’t undermining that. With e-shopping getting popular with youth, we will have to increase our digital presence in select areas.
And are we right in guessing that media spends (overall) on Tata Salt have come down in recent years?
Not at all. Media spends have been stable. But you have to understand that our overall marketing budget is insignificant. Salt is a low involvement category. How many TVCs or print ads do you see in this category? But advertising helps nonetheless. Our annual budget will be allocated towards introducing newer variants in the category.
How have modern trade formats impacted Tata Salt? How much do they contribute to sales?
Modern trade format stores contribute to about four to five per cent of our revenue, which is not very large. What’s interesting is that there are stores that evaluate store managers’ sales performance based on how much Tata Salt they have sold. When (some of) these format stores were set up, they were selling their own branded salt which didn’t work for very long because of the strong equity that Tata Salt commands. Consumers come and pick up Tata Salt and don’t even look at four other brands is what we are told. At modern stores, it is critical to figure what is the kind of pull you can create for the brand. We are lucky to have reached a stage where Tata Salt has become synonymous with salt amongst consumers.
What’s next on the radar?
We are reaching out to six crore households every month. As a part of our five-year plan, we are planning to hike capacity from 6.2 lakh to 8 lakh tonnes by March’13. Around the same time, we plan to launch double fortified salt which will have iodine and iron. We are working in collaboration with National Institute of Nutrition for this new variant. It could be one of the game changers for Tata Salt. This sub-brand will take up the next battle: fighting anemia. Our next objective is to ensure that what Tata Salt did with iodine for India’s mental health, it is able to do it with iron for the country’s physical health as well. Can we have a product which fits both body and the mind? That’s the space we want to venture into now.
Chutki Bhar Jaadu – Tata Namak 2001 (Publicis)
Tata Namak – with Farida Jalal 1995 (Zen)
Tata Namak – Chutki ki Chamak 2006 (Leo Burnett)
Tata Namak with Pankaj Kapoor 1993 (Zen)
Tata Salt – Mothers for Mother India 2012 (Leo Burnett)
Ghulmil 2008 (Leo Burnett)
Tata Salt – Pizza 2005 (Leo Burnett)
“Khana yu hi khazana nahi banta ” Sanjeev Kapoor 1998 (Zen)
Tata Salt – Purity Film 2010 (Leo Burnett)