Thursday, November 01, 2007

RIN and Surf Excel

Much is discussed about the RIN and Surf Excel brand merger. Many of them have been seeing it only from the perspective of brand dilution??

First let's see what is the situation??

HLL has RIN bar, detergent and Surf Excel detergentBut P&G has extended the brand TIDE from detergent powder and launched TIDE bar which is expected to take away the sales of RIN.


At this point, HLL might have come up with a Surf Excel Bar........butthe problem is that they need to build a new brand in the category of product they are already into.....Will this help?? No is the answer. because, they have been already spending huge amounts over brands RIN and SurfExcel for Bar and Detergent powder respectively... and getting a new brand of soap would once again just cost them in huge amounts which would do nothing apart from competing with TIDE and would take away the share of RIN itself(remember it will also compete with RIN because they all are in the same price range...)

All this only leads to division of customers of RIN to be divided into 2 groups for RIN bar and SurfExcel Bar. So, huge costs to build a new brand to divide the customers into 2 groups which is useless for HLL. And if it doesn't come up with a SurfExcel Bar, the situation would be that TIDE with its present brand image will definitely take away a chunk of RIN customers....And one more cost that HLL would be incurring which P&G will not incur is the advertising and Branding costs.

HLL would have double the cost that P&G would incur as P&G will focus on building brand TIDE whereas HLL will be incurring costs to build brand RIN and brand SurfExcel.Hence, inorder to decrease the costs it is and would incur HLL has come out with the decision to change RIN to SurfExcel Bar..And now it is fine that HLL hasn't taken a bad step with respect to the strategywise..Now what we need to see is have they executed the decision well or has the execution gone wrong...

First looking at informing your customers about the change.. they have come out with a superb advertisement that has caught the attention big time...Second thing is they haven't changed the name directly by printing SurfExcel name on the Bar. If you have seen the new SurfExcel Bar(RIN Bar), there were names of RIN as well as SurfExcel side by side showing an arrow from RIN directed towards SurfExcel communicating to the customers once again that RIN bar will be SurfExcel BAR.

So, I hope the way HLL has executed the strategy perfectly seeing it from the side of brand as well as costs that they are incurring..But,one thing we need to see is how many days is HLL gonna use the same packaging for the bar. Beacuse, if it is gonna remove this sort of packaging very soon and replace it with only SurfExcel name, it would be problematic because the idea of name change getting into the mind of customers might not be that high..

Hence, it should continue the same packaging for more time so that the execution that was started perfectly would end in perfection...
Seeing all these can anyone think of any steps HUL might take in the near future..I can see one possibility from the side of HUL in this detergent market. might be that it would also remove the RIN Advanced Detergent powder since it has already moved out the RIN detergent bar...