Game of Oils: Dabur Anmol Gold takes on Parachute in a price war ad
Are we seeing the beginnings of a new brand war in the hair oil space? Anmol Gold, the coconut hair oil brand from Dabur India, took on competitor Parachute Oil brand from Marico in a recent print ad. The ad, which appeared on the front page of Saturday’s (November 23, 2019) edition of The Times of India, is pegged on the price factor, wherein it is mentioned that Dabur Anmol Gold is priced at Rs 30 for 100 ml, as against Rs 39 for Parachute Oil. “Dabur Anmol Gold Coconut now at much better value than Parachute Coconut Oil,” stated the ad.
Both the companies have been competing with each other in the large hair oils market. While Dabur also has Vatika and Amla hair oil products, Marico has introduced different versions of Parachute Oil and also has Nihar Shanti Amla oil.
According to reports by The Economic Times, Dabur took Marico to the Delhi High Court last year for trademark violations. Marico had released print ad campaigns which compared their Nihar Shanti Amla hair oil to Dabur Amla oil.
According to ASCI codes, advertisements that compare two products or manufacturers where the competitor is named are allowed in the spirit of tough competition and to inform or enlighten the consumer. However, the ad needs to be factual and should not mention anything that isn’t true.
Adgully reached out to both Marico and Dabur for their comments, but was yet to receive a response at the time of filing this report.
Marico is the market leader in the hair oil segment. However, according to media reports, Parachute’s volume growth has declined by 1 per cent in Q3. On the other hand, the company’s earnings release said that the volume growth was healthy at 5 per cent.
Will this direct comparison with Parachute benefit Dabur?
Himanshu Manglik, Founder and President, Walnutcap Consulting, remarked, “Personal care brands are built over time and the consumer preference is not easy to dislodge. Hair oil is a typical example. Therefore, the effort is always to motivate or incentivise the consumer and generate higher trial for the product. This campaign by Dabur for its coconut oil is a very in-your-face campaign. It can expect greater pick-ups and trials in the short term, especially today, when consumers are being impacted by the slowing economic environment and are willing to trade down. It might even get a few loyal consumers of parachute to evaluate Dabur again. The trick will be in the retention of these floating consumers.”
On the other hand, Vinay Kanchan, a Brand Storyteller, Innovation Catalyst and Bestselling Author, felt that it was a very bad idea and just played on the pricing factor of Dabur’s coconut oil. “It doesn’t talk about any ingredients that make the oil better. Even the packaging is very similar to what Parachute already is. As a consumer, I do not have enough incentive to go for this product.” Kanchan said, adding, “If Dabur is looking to challenge Parachute, which is the market leader, they should be going be going for a better story than just playing on the price point.”
Kanchan further said, “At best, this will show a brief shift in sales as some people might go for it looking at the prices. However, you need a better value proposition if you’re looking to take on an industry leader.”
Agreeing with this, Himanshu Manglik said, “The temptation to play the value game through comparative advertising makes it a high risk campaign and has the potential to create a positioning trap for Dabur. In the past, Dabur has used the higher price to establish superiority of its Dabur Amla over ‘Sasta’ brands and in the current campaign for the Coconut oil it is glorifying significantly lower price as better value against the strong ‘Parachute’ brand from Marico. Consumers may have short memories, but they are quick to notice shifting stance. There are nuances in this advertisement that can undermine the Dabur brand. Consumers could choose to buy the cheaper Dabur Anmol Coconut hair oil for now, but they will constantly compare it with the higher priced Parachute coconut oil. They will continue to worry that lower price may mean better value, but does it also mean a better product? Dabur coconut oil will have to pass the floor test. Consumer perception is a very powerful component of brand equity. It can impact the bigger brand portfolio for Dabur. Such gimmicks are avoidable unless you are on solid ground, and if that is so then it is better to charge a higher price and take pride in it. Just as Dabur is doing for its amla hair oil.”
Definitely Marico has noticed this attempt by Dabur to challenge them for their throne. The interesting thing to look out for is what will be Marico’s next move. Will they respond to this or will they leave it alone? Kanchan and Manglik both feel Marico should just leave it alone. While Manglik said, “Marico needs to steer away from the comparative advertising war and ignore Dabur’s claim. However, it must step up its advertising as the preferred and trusted brand. It needs to engage with its loyal consumers and voice their pride”, Kanchan’s recommendation to Parachute was not to do anything about this. He added, “The worst thing they can do is respond to this. They should be where they are, do what they do and just watch the market. By retaliating or responding, they will just increase Dabur’s prominence.”
However, this kind of a situation has often ignited interesting rivalry along with fun creatives. Rivals exist in every sector of the market. In the cola beverage sector, the Coke vs Pepsi war has been keen watched and liked by the people for years.
For instance, for Halloween, Pepsi released an ad that showcased a can of Pepsi wearing a Coca Cola cape. The tagline said, “We wish you a scary Halloween”. When it comes to Coca Cola and Pepsi, which are big legacy brands, the consumers often argue about which one is better and take sides. Some fan soon took this up and made a few changes to the creative, which actually made a lot of sense. The picture was posted on the internet by 9Gag.
Another example is in the toothpaste category, with a keen rivalry between Colgate and Pepsodent. Below is a TVC where Pepsodent directly took on market leader Colgate. The ad features both the products and mentions both their names. Through this ad Pepsodent claimed to “kill 130% germs” and showcased itself as the better toothpaste than Colgate.
Such brand wars are often fun to watch from the sidelines. Taking on a market leader through aggressive advertising is always risky for the challenger. Likewise, a market leader’s response or actions, post being challenged is also vital as one wrong move can de-throne them. The real question now is whether Marico will respond to Dabur’s attack. If so, how will it pursue to do it? Also will Dabur back up this print ad with more such creative to dig on Marico? We might be looking at the beginning of a brand war in the hair oil segment. Whether it actually culminate into a war or not is something we will have to wait and watch.