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Paper Boat Case Analysis

The document discusses the business challenges facing Hector Beverages, the maker of Paper Boat drinks. It analyzes Paper Boat's product, brand positioning, market growth, competitors, and marketing strategies. It recommends that Paper Boat launch more seasonal variants, reduce packaging costs, increase advertising, expand internationally, and incentivize retailers to boost growth amid new competition.

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Ashish Patel
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461 views3 pages

Paper Boat Case Analysis

The document discusses the business challenges facing Hector Beverages, the maker of Paper Boat drinks. It analyzes Paper Boat's product, brand positioning, market growth, competitors, and marketing strategies. It recommends that Paper Boat launch more seasonal variants, reduce packaging costs, increase advertising, expand internationally, and incentivize retailers to boost growth amid new competition.

Uploaded by

Ashish Patel
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Problem Statement

 Should the brand add more variety to its product line?

OR

 Should it focus on few best-selling variants in order to grow?


 What should company do to stay relevant, when Dabur has launched “Yoodley” to counter
Paper Boat?
 How could Hector Beverages’ marketing strategy keep the growth momentum going and
consolidate the company’s growth on Indian Ethnic drink market?
 Sourcing of Raw Materials was a problem
 Seasonal ingredients procurement
 Lack of organized suppliers

Paper Boat Product / Brand

 Ethnic Drinks Category (non-carbonated flavoured drink) – niche market


 Brand Launch – 2013
 Tagline – Drinks and Memories
 Core Benefits
o Product’s Simplicity – familiarity with the ingredients were supportive
o Health – health benefits of the ingredients
o Joy of drinking experience
 Growing consumer acceptance of the paper boat
 USP or POD – Made ethnic drink recipes which are on the brink of extinction are now
easily available to consumers
 Product mix – 10 variants of paper boat by 2015 end
 Needs fulfilled - Indulgence, thirst quenching, food accompaniment, regular consumption,
homogenized taste and people expectations with home-made centuries old recipes &
personal connection
 Satiated Thirst & Health Benefits
 Selling Point – Authenticity to convey health benefits
 Emotional benefit – reconnection with childhood + bringing simplicity in consumers
complicated life
 Brand Feeling – Déjà vu
 Brand Essence – Childhood innocence and memories
 Brand evoked pleasant nostalgic memories

 Brand Positioning – For Urban Indian youth in the age range of 25-40 years who are
confident enough to take on a demanding world, while remaining rooted in Indian Culture
and traditions, Paper boat is the brand in non-carbonated Beverages Category that offers
feeling of reconnection with childhood with its long lost recipes of grandmothers. The brand
character is of Joy & innocence and creativity
 Unique Name – Paper Boat – strongly associated with joy, innocence and creativity

Company – Hector Beverages

 Founded in 2009 by Neeraj Kumar Kakkar, James Nuttall, Suhas Mishra & Neeraj Biyani
 Registered office - Gurgaon
 Strong presence in top 6 metro cities
 Products Launched
o Frissia – failed
o Tzinga – success in its target market – penetration pricing
o In 2013, launched Paper Boat – ethnic drink
 By 2015, Paper boat consisted 90% of the company’s total sales
 By 2015 end, 10% of sales of paper boat came from institutional clients
 By 2015, 50% of the paper boat sales were from southern metropolitan areas
 Two Plants – combined capacity of 10 million units a month
o Manesar
o Mysore
 Workers – 300
 By 2015, Valuation – 4 billion

Market

 In 2015 – Fruit based beverages market stood at 7 billion Rs and By 2016 – 12 Billion Rupees
expected
 Market growth rate – 45%
 India has 28 states and each state has its own food habits and specialties

Collaboration

 Rs. 300 Million funding by Venture Capitalists


 By 2015, total funding was 2.5 Billion Rupees

Competitors

 Unbranded Category
 Pepsico
 Coca Cola
 ITC

Consumer

Target Segment -

 Urban – lives in cities


 Typical Indian Youth – 25 to 40 age group
 Has nostalgic connection to home-made drinks
 Also targeted people who experiment with something for the sake of novelty

Cost
 Cost of packaging was 10% of MRP – still cheaper than tetra packs

Marketing Strategy
Pricing

 Prices were 3 times higher than unbranded products


o 250 ml – Rs. 30/-
o 1 Litre – Rs. 120/-

Distribution

 Started with Limited distribution


 Made available in 500 premium modern retails outlets
 Further increased the reach to institutional and retails outlets
 Premium office canteens, multiplex chains, coffee shop chains, and restaurants in upscale
hotels
 Products made available on Jet Airways & Indigo Airlines (To target middle and high class
opinion leaders)- Exclusive partnership
 In April 2015, 12000 retail outlets in 6 Metro cities
 Negligible presence in Tier 2 & Tier 3 Cities, hindrance to growth
 In April 2015, alliance with Indo Nissin Foods – access to 2 lakh retail outlets in 200 cities
(mostly tier 2 & 3)
 Opportunities
o Offer more trade margins
o Incentivize retailers by spending more
o Commercial contract with Indian Railways

Promotion

 Relied on word of mouth promotion

Dabur piggybacking on hajmola brand

Recommendations

 Launch more variants (but with deep research and testing market) - some should be year
long product and some should be seasonal temporary based on the climate and ambience -
winter
 reduce costs on packaging
 Give seasonal offerings and control its supply accordingly - especially for winters
 Heavy advertising - people should know that the brand exists while making a buying decision
 Expand in to different market - different country (long term)
 Incentivize retailers into selling your product when entering in new geographies
 when it was a niche market this communication strategy worked but with new players
coming and stealing market share - paper boat need to reach out to larger audience in a
tone familiar to them

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