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Paper Boat:  When do you drink nostalgia and innocence? Why the Path to Purchase Matters

 

The Paper Boat brand is a darling of the business press, with business journalists writing lots of positive stories about the modern, cool brand which has shown a way to take the traditional drinks of India and make them relevant to today’s consumers.  It is also a favorite of brand and marketing strategists who offer a critical appreciation of how the emotion of nostalgia and the promise of a return to the innocence of childhood have been woven into a powerful brand narrative that creates a lot of brand engagement among the millennials.  It is also a good case study for how products are an embodiment of the brand’s world.

Apart from the tech and e-comm businesses, it is also one of the leading lights of VC and investor backed new age businesses of contemporary India.  These investors presumably go by the fundamentals when they “buy into” the “growth” potential of a business.  And they believe the fundamentals of this brand are strong and can be scaled over time, to make it profitable and give 10x multiples to the VC funds when they go to IPO.  According to VC analysts, the next steps for the brand to scale are expansion of distribution and manufacturing.   However, the VC analysts also acknowledge that the value proposition of the brand is a dampener for scaling up because a pack is priced at Rs.35/-.  In March 2016 filings, Hector Beverages annual sales were Rs.72 cr and losses were Rs.84 cr.

What has all of this to do with the path to purchase?  It came to me when I was in the midst of a discussion with a group of young millennials about new age brands and one of them said, Ma’m, I love the Paper Boat brand but I have never bought the drink.  I said, how do you mean?  She said, I love the imagery, the emotion of nostalgia and I go to their FB site and post on it.  But I have never bought their drink.  I asked her, why not?  And she said a couple of things.  First, when I am thirsty and looking for a drink, I don’t know how it will quench my thirst.  Second, I am not sure whether I will like the taste.  Third, it is expensive, when many good drinks are available at Rs.10 (Amul Chaach), Rs.15 and Rs.20, I am not sure why I should pay Rs.35/-.  I really like its packaging though.

This pointed me to a potential huge disconnect between the brand’s imagery and the functional needs for which people buy packaged drinks today, including the much hyped up ‘millenials’.  If the gap is great even among the most brand aware and brand engaged segment of the population, what would be the case among the rest, who are not so plugged into ‘brands’.  It was an interesting case of high brand engagement with low product purchase becoming the nemesis of the brand.

It took my mind back to the JWT school of advertising planning developed by Stephen King almost 50 years ago and which I was taught, when I joined JWT in 1994.  There were several frameworks and tools that we were taught to use.  One of the key tools was the Buying System, where we had to track the path to purchase of consumers of the category and link that to the role for advertising at each stage of the path.  This was necessary in order to ensure that the advertising investment paid off for the Client in terms of conversion to sales.

When thinking of consumer’s triggers to purchase the category, the planner is forced to consider the functional needs that drive purchase and how they play out in the context of the consumer’s life.  A simple mapping of the everyday, weekly and special occasion, functional needs of different segments of consumers vis-à-vis packaged drinks could have pointed out the disconnect.  Most of the time, most consumers buy packaged drinks for thirst quenching and refreshment needs.  Apart from those, they buy packaged drinks as mixers with alcoholic drinks and for socializing – offering to guests.  Some consumption also happens as meal accompaniment, where soft drinks are ordered at clubs, restaurants and out-of-home eating places to be had with meals.  The moot point is where in this range of functional needs do the Paper Boat drinks fit in?  What drinks can they replace as a substitute?  What drinks are they a good alternative to?  And how does price as well as size of serving impact the substitutability?

I would urge the managers of the Paper Boat brand to study these aspects carefully and find good answers so that they can create the growth in consumer demand for their drinks.  Such foundational understanding and analysis may be less glamorous than signing on movie stars and cricket stars as brand ambassadors.  But they are the base on which branded businesses are built.  Engaging consumer’s emotions through an appealing brand imaginary and narrative is only one part.  Linking that back to the reality of consumer’s purchase behaviors and habits as well as category repertoires and choices is an equally critical part.  Functionality + Emotionality + Imagination + Value – all are required in order to build not just brand symbolism and stories but also businesses that are hard-wired for growth.