Water has been identified as a critical product area for the Tata Beverage Group, one that occupies a significant space in the basket of good-for-you products that the newly integrated company is banking on. Pradeep Poddar, head of Mount Everest Mineral Water, the Tata Beverage Group’s water business, speaks about the opportunities and challenges in a market estimated to be worth about Rs15,000 million annually and growing at 25 per cent a year
How is Tata Beverage Group’s liquid distribution business, as you call it, being built?
The business operates on a thin margin and, hence, success is dependent on operational efficiencies and scale. For a nascent organisation such as ours, it was critical to leverage available distribution without having to invest too much on creating infrastructure. Our water brands will ride on the infrastructure created by Tata Beverage Group.
What are the challenges of operating in the Indian market?
The water category in India is a recent phenomenon. A previously non-existent category has grown into a huge market and has become one of the fastest growing verticals in the last decade. It has flourished due to the non-availability of potable water outside the home, especially so with the rise in disposable incomes and the ever-growing habit of middle-class India to eat out, travel, etc.
There are a plethora of brands with no significant differentiation. The three national brands, Bisleri, Aquarian and Kinsley, are currently running neck-to-neck, but they account for only 40 per cent of total sales. The challenge continues to be the building of a sustainable business model that allows a brand to secure long-term, profitable growth.
How would you carve out a niche position with such a clutter of brands?
I would say there are a lot of brand names but very few brands. The category still languishes as a commodity category and is waiting for a brand to take on the mantle of leadership. With Himalayan we have forayed into changing the dynamics of this market: it is no longer water on sale but a lifestyle choice. We are building a brand on a highly differentiated platform.
What sets Himalayan apart?
Himalayan is a natural mineral water brand and is ‘source-centric’, which means its equity resides in its source. There are very few natural sources of water that can be showcased as Himalayan. This water gathers the goodness of nature and is pure and healthy.
We intend straddling the entire water vertical across consumer segments and expanding our geographical footprint beyond India. We are truly a global brand in the making with Himalayan.