By Simran Sabherwal
Despite the current economic downturn, Berger Paints, the second largest entity in the decorative paints sector in India, has registered impressive growth. Abhijit Roy, Managing Director & Chief Executive Officer, Berger Paints India Limited, tells us that constant innovation and betting on middle India has helped the company forge ahead
Q] What is your current brand positioning?
Berger Paints stands for innovativeness, and that is the position we would like to hold on to. We have innovative products in our portfolio and the company looks to enable consumers to use these products. Our line is, “Paint Your Imagination”, so whatever you imagine – be it new or innovative - we provide you the tools to help translate that into reality. We are a paint company that likes to innovate, to improve the aesthetics and the functional usages in your home. This is also the fundamental principle of our marketing strategy - understand what the consumer wants, innovate for him and give it to him at a price which suits him.
Q] What does your media mix look like?
We are present heavily on television (upto 80% of ad spends), followed by Print. Of late, we have invested and put in a lot of effort into the Digital medium. Recently, we created a new website and have undertaken a lot of other initiatives to improve our salience within the digital world, i.e., bringing our name to the forefront in terms of search engine - so Search Engine Optimization is a focus area.
Q] How do you engage with consumers to increase consumption of paint?
People tend to repaint their homes after four to five years, this is normal in terms of the paint cycle. While painting the entire house is long-term, we bring in new designs and ideas to encourage consumers to paint just a wall or two and not the entire house. Painting a wall with a particular design not just keeps it fresh but helps us engage with the consumer in the interim period. We have specialized products such as WeatherCoat Kool & Seal, which when used on the roof, helps keep the house cool in summer and also saves rooftops from leakages. Earlier, people may not have used this product but today, we keep innovating and giving new products to consumers. By bringing out new products, you get a chance to enter the consumer’s house and keep the interaction going. We also have a specialized team that regularly interacts with our influencers – dealers, painters, decorators, etc., who help take the message of our new products to consumers.
Q] Katrina Kaif is the brand ambassador for Silk. What makes the brand connect for Kaif?
Silk is a premium interior emulsion; it is a rich and exclusive product. It is at the higher end of the spectrum, has a wide range of colours and is the best quality paint in the interior spectrum that we have. Katrina Kaif epitomizes almost all these characteristics - she is in that exclusive bracket and stands for quality. As it is interior paint, beauty, colours and textures also come into play and this is also associated with Katrina. We will be revisiting our ad soon and getting into the second phase.
Q] What was the insight behind the ‘Lewis Berger Design Stories’ in association with Sussanne Khan and The Charcoal Project?
The insight is that people tend to change their curtains and sofa colours to match the paint colours on the walls or vice-versa. In this scenario, we provide a complete package – interior designers are expensive, and if you can get a famous interior designer who gives you combinations for the curtains, sofas and also the paint on the wall, it makes sense and is much more beneficial to the consumer. We found the concept to be an interesting one and are implementing it in two locations, Kolkata and Delhi. The response has been positive and we would like to expand it to other places. As of now, it is still at a nascent stage. Some consumers have shown interest in taking the complete package, but the percentage is still quite low. But it is going to expand.
Q] The economic downturn in India has particularly hit the realty sector. How has this impacted the paint industry in general and Berger in particular?
The downturn has impacted the paint industry marginally. Of the paint industries’ total consumption on the decorative side, 85-90% is repainting and only 10 to 15% is from new constructions. So 15% has been affected to some extent but 85% remains more or less settled and the impact has not been as adverse as it would be if we were totally dependent on the realty sector.
Q] What are the challenges faced by Brand Berger?
The downturn has meant that demand per se has become a bit of a problem. Paint is a discretionary category and with high inflation, people tend to postpone their paint purchase decisions. This has led to a delay in demand primarily in major cities and towns where there has been some sort of a slowdown in the consumption of paint. However, demand in Tier II and Tier III towns has been good, new houses are getting made and they continue to paint and consume. As the input costs have gone up, we increased prices by about 6% and this adds pressure on the consumer and tends to slow down the volume off take.
Q] So are Tier II and Tier III towns the future growth areas?
Yes, future growth will be mainly driven by the Tier II and III towns, which are significant contributors and are growing at a faster rate than Tier I cities. These towns are developing and it is essential that you have a presence here. Only 28% of India is urbanized; while the urbanization level is over 80% in Europe and the US. We still have a long way to go and as people start moving from villages to towns, new construction will take place – they will paint for the first time and then repaint four or five years later, so the consumption will increase. The huge expanding middle class with higher income levels will also invest in new houses and they will buy good quality paint.
Q] What is the current market size for the decorative paint segment and your market-share? What are your future plans?
The total size of the decorative paint segment is about Rs 16,000 crore and we hold about 19% share in it. We have aggressive plans, we are looking to improve ourselves, become the best in terms of deliveries to consumers and become one of the largest players in India and Asia.
Feedback: simran.sabherwal@exchange4media.com
