Abstract:

The case examines the market revamping exercise

undertaken by Rasna Ltd., manufacturer of the
leading soft-drink concentrate brand Rasna, in the
Indian market. The case provides a detailed
account of how the company built up the
preparatory drink segment in the Indian beverages
market by focusing on distribution, promotion and
advertising.

The problems faced by Rasna in the late 1990s

that led to the decision of a marketing strategy
overhaul have been examined. One of the
revamping strategies of Rasna, in terms of new
product launches, segmentation, pricing and
advertising have also been discussed.

Issues:
» Understand the dynamics of the soft drink concentrate (preparatory) business as part of the
Indian beverages market.

At Rasna we are constantly looking at new innovations and strategies. Today, the per capita
consumption of Rasna is 15 glasses and our vision is to increase the per capita consumption to
100 glasses by 2005 and to reach out to one billion Indians every year."

- Piruz Khambatta, Chairman and Managing Director, Rasna Ltd., in March 2002.

No More 'I Love You Rasna'

Pioma Industries Ltd. (Pioma) is perhaps not a
familiar name for the average Indian consumer.
However, Pioma's brand 'Rasna' is very well
known.

In fact, the name Rasna is almost a generic name

for soft drink concentrates (SDC), a segment that
had been created and nurtured by the company in
the Indian beverages market.

Rasna's extremely popular advertisements with

the tagline, 'I love you Rasna,' had become an
integral part of the Indian advertising folklore. In
March 2002, Pioma announced a radical
overhauling of its strategies for the Rasna brand.

This development was rather unexpected, as the brand had been lying dormant since long.
Company sources revealed that these developments were in line with a restructuring program
that had been conceptualized in mid-2001.

Keeping in line with this plan, Pioma launched

two new brands, Rasna Utsav (Rasna Festive) and
Rasna Rozana (Rasna Daily) in March 2002.

The launch was accompanied by a multi-media

advertisement campaign, for which the company
allocated Rs 160 million.

The television campaign that ran across all major

national and regional channels featured a 'song'
exclusively composed for the new launches.

A notable feature of this commercial was the fact

that it was voiced by one of the country's most
well known singers, Asha Bhonsle, who had never
sung for any commercial before.

No More 'I Love You Rasna' Contd...

Pioma soon released music cassettes and CDs featuring remixes of old, popular Hindi songs and
the new Rasna song. In addition to this, the company sponsored musical events across the
country. Industry observers were however, viewing the above developments as Pioma's desperate
attempts to infuse fresh life into Rasna.

There were apprehensions regarding its success

given the fact that previous attempts in form of
brand extensions had failed to have any
significant impact on Rasna's growth prospects.
And unlike the late 70s, the average beverage
consumer in India had a host of other options,
such as colas, fruit juices, iced tea, tetrapacked
juices and other soft drinks.

Most importantly, Rasna's stronghold in the SDC

market was facing severe competition from Coca-
Cola's newly launched Sunfill and Dr. Morepen's
C-sip. Rasna's fading 'brand awareness' and its
lacklustre image had become major hurdles,
capable of marring the prospects of the new
marketing overhaul exercise as well.
The Making of Rasna
Pioma, an Ahmedabad (Gujarat) based company was the first to introduce the concept of SDC in
India. Its proprietors, the Khambattas saw a huge untapped potential in the market with Coca-
Cola, an MNC cola major, on the verge of closing all its operations in India, due to policy
changes with regard to MNCs operating in India.

At that point of time, there were no major players

in the preparatory SDCs market. Pioma thus
launched an SDC under the brand name 'Jaffe' in
1976 and marketed it with the help of Voltas.

The brand name was changed to Rasna in 1979.

Rasna's SDC, comprised a powder sachet and a
small bottle of thick, coloured liquid. While the
powder provided the taste, the liquid gave the
flavor.

These ingredients had to be mixed with a

specified amount of water and sugar. The
resulting syrup could then be used over a period
of time by mixing it with water.

Though many analysts felt that Rasna's do-it-yourself concept would be cumbersome and hence
unappealing to consumers, it became the very reason for its success. This was because Rasna
was able to exploit the Indian middle class housewife's traditional distrust for food and drink not
made at home...

Excerpts

Rasna Wakes Up To The Challenge

Pioma finally decided to extend Rasna's brand portfolio and launched a pre-sweetened mix-and-
drink product in 1996. Targeted at the upper end of the market, Rasna International was a
nutritious and vitamin-enriched version of the regular Rasna SDC version. This was followed by
the launch of Rasna Royal, positioned as a vitamin-enriched version of Rasna...

Facing Challenges - The Second Inning

The major thrust of the company's restructuring
exercise was to reach out to the masses and create
brand awareness in towns and remote villages.

Emphasis was also laid on the availability of

Rasna products in the price range of 80 paise per
glass to Rs 4 per glass.

Till now, Rasna was available only in two price

segments - Rs 4 and Re 1. The company's
principal focus in 2002 was to increase the
number of segments to make Rasna products more
affordable to larger various sections of society.

The company also extended its strategy of Rasna being a mass drink to its global markets.
Commenting on this, Khambatta said, "We have made sure that the Rasna International brand is
placed along with the other preparatory soft drink brands such as Tang in international retail
stores, and not in the Indian foods counter in those stores."...

Hoping For A Sweet Future

Although Rasna succeeded in increasing its sales
in mid-2002, few analysts were skeptical about
the long-term success if revamping strategy. The
entry of players like Coca-Cola, Kraft Foods,
Dr.Morepen Labs and Hindustan Lever Ltd. and
their financial muscle was expected to pose tough
competition for Rasna in the future.

In 2002, Rasna was in the process of finalizing a

joint venture with Del Monte, the largest producer
of canned fruits and vegetables in the US to offer
convenience foods...

Exhibits
Exhibit I: Rasna -International Presence & Offerings
Exhibit II: Soft Drink Market In India

Revamping Rasna - A Marketing Overhaul Saga

"At Rasna we are constantly looking at new innovations and strategies. Today, the per capita
consumption of Rasna is 15 glasses and our vision is to increase the per capita consumption to
100 glasses by 2005 and to reach out to one billion Indians every year."

- Piruz Khambatta, Chairman and Managing Director, Rasna Ltd., in March 2002.
No More 'I Love You Rasna'
Pioma Industries Ltd. (Pioma) is perhaps not a familiar name for the average Indian consumer.
However, Pioma's brand 'Rasna' is very well known. In fact, the name Rasna is almost a generic
name for soft drink concentrates (SDC), a segment that had been created and nurtured by the
company in the Indian beverages market. Rasna's extremely popular advertisements with the
tagline, 'I love you Rasna,' had become an integral part of the Indian advertising folklore. In
March 2002, Pioma announced a radical overhauling of its strategies for the Rasna brand. This
development was rather unexpected, as the brand had been lying dormant since long.

Company sources revealed that these developments were in line

with a restructuring program that had been conceptualized in mid-
2001. Keeping in line with this plan, Pioma launched two new
brands, Rasna Utsav (Rasna Festive) and Rasna Rozana (Rasna
Daily) in March 2002.

The launch was accompanied by a multi-media advertisement

campaign, for which the company allocated Rs 160 million. The
television campaign that ran across all major national and regional
channels featured a 'song' exclusively composed for the new
launches. A notable feature of this commercial was the fact that it
was voiced by one of the country's most well known singers, Asha
Bhonsle, who had never sung for any commercial before.

Pioma soon released music cassettes and CDs featuring remixes of old, popular Hindi songs and
the new Rasna song. In addition to this, the company sponsored musical events across the
country. Industry observers were however, viewing the above developments as Pioma's desperate
attempts to infuse fresh life into Rasna. There were apprehensions regarding its success given the
fact that previous attempts in form of brand extensions had failed to have any significant impact
on Rasna's growth prospects. And unlike the late 70s, the average beverage consumer in India
had a host of other options, such as colas, fruit juices, iced tea, tetrapacked juices and other soft
drinks.