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Paper boat: Navigating successfully in the beverages market

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MUMBAI: It’s not about commercial success; it’s about telling a story. It’s not about spending plenty, but it’s about innocently connecting one to nostalgia. 

A brand from nowhere penetrated the Indian beverage market with a few never-heard-about drinks and in never-before-seen packaging and in no time emerged as a trend setter for others to follow. When it entered not many prophesised  success, but as they progressed and hit a home run, they definitely piqued brand mavens’ interest.

 Backed by Sequoia Capital start-up Hector Beverages’s Paperboat with a few million happy consumers has made a major mark in the $5.18 billion beverage market. 

“956 happy people is the size of our company,” says Hector beverages CEO Neeraj Kakkar which somehow depicts the ethos the company follows. 

There are three active plants in which both R&D and production takes place. The company raised about $30 million last year and pumped it into increasing manufacturing capacity. 

“At this stage we are producing 420 bottles per minute. By June we will have our new plant in Mysore operating, that will spur up our production to 900 bottles per minute,” informs Kakkar.

Though Hector Beverages would like to grow further but at this stage the management is not looking to raise any further funds.

 “There is no end to growth and we would like to grow further, but we have the money for now and we are not looking to raise more funds rather our focus is to launch new recipes,” says Kakkar.

Besides happy people and quality infrastructure, Hector Beverages also has 14 recipes, which previously never featured in the catalogue of traditional beverage brands. Drinks, which only grandmothers used to prepare in the Indian kitchen, were introduced in innovative packages for consumers.  Be it  Kokam, Aam Panna or recently launched chili guava the drinks successfully managed  to take us down nostalgia lane.  

Products are tested and gestated in the lab for up to three years before making it to shop shelves. “As we speak now we have more than 35 projects which we are working on. Khanji is a drink we started working on two years back and still we are not anywhere close to launching it. Recipe, research, raw material, commercialization, rollout is the broad structure that we follow,” the CEO educates. 

Chilli Guava and the sweet concoction of jaggery Pannakam are the two drinks the beverage company has already launched this year and going forward the plan is to launch 10 more.

The $100 million company has secured triple digit growth last year and plans to match that number this year too. “We are poor at numbers,” says Kakkar with a wide smile “and hence will not put any number target, but as I mentioned the target is to keep the recipe alive,” he adds.

The recipes when clubbed with the TVCs Hector Beverages has been creating in association with Lowe Lintas, manage to take one to a paper boat ride down memory lane. The Malgudi Days tune paired with Gulzar’s poem and recitation are indeed an alluring hypnotic lead in to the mouth-watering fruit beverages in the TVCs. And behind all the marketing initiatives the man responsible is the company’s marketing head Parvesh Debuka. 

He believes innocence is the key and that is all the brand wants to communicate.  Recently  the company reprinted The Jungle Book and offered it free to consumers purchasing six standi-pouches at a time. The bundle was released at a time when India was screening The Jungle Book in theatres. 

“It is a co-incidence,” says Debuka, “We have been planning the reprint since a year now. That time we had no idea about when the movie will be in the theatres. This is a part of our plan to create a PaperBoat library and we reprinted Three Men in a Boat by Jerome K Jerome last year and next year too we will reprint one and give it for free to the consumers.”

The Indian ethnic drinks manufacturer targets anyone who consumes fruit beverages  without any demographic segmentation. But its key target is the 20 to mid-30-yers and it’s communication is also addressed towards them. 

“Digital is where we pay serious attention for its interactive nature but in terms of spend TV continues to be the focus and the return on TV is more,” says Kakkar. “This year value wise our marketing spend will go up as it will be certain per cent of the sales which has gone up significantly, but the percentile would be less than last year as last year our emphasis was on getting more awareness.”

 Consumer insights play a vital role in orchestrating the road map when it comes to marketing as well as packaging, “We got feedback after we changed the cap of our packet. Someone wrote to us sharing his difficulty in opening the new package and then we immediately changed it to the butterfly one. We also use feedback to strengthen our recipes and hence they are always precious,” adds Debuka.

Paper Boat’s journey so far has shown others a new way to sail in to the beverage market and there are many now following them.

 Hajmola launched Yoodley with similar packaging and identical flavours, “Competition only makes the ecosystem better, there is nothing for us to worry about. In fact I am happy that there are other players coming in, it will broaden the size of the market,” concludes Kakkar. 

Spoken like a true sailor!

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