Get ready to beat the heat this summer. Rasna is planning a new range of ‘functional beverages’ for the season.
A functional beverage is a non-alcoholic product that includes in its formulation ingredients such as herbs, vitamins, minerals, amino acids or additional raw fruit or vegetables. The company’s new business division, Rasna Beverages, is unleashing energy drinks, fruit drinks and fruit nectars, which will be pitted against multinational brands in their respective segments.
“We are looking at value added offerings in segments such as fruit juices, nectars and energy drink and test launching them next month under sub brands. These would be under functional beverages as we are adding something to them to differentiate from the rest of the brands in the same category,” said Chairman and Managing Director Piruz Khambatta.
The Ahmedabad-headquartered company has decided to go mass with its new launches and would be staying away from the premium-end of beverages segment.
For instance, in energy drinks, it has decided to address the mass market with price points which would be much lower than the existing brands. “We are trying to introduce the concept of an ‘Indian’ energy drink by adding herbs, which will be mass and priced lower than brands such as Red Bull. So if the existing brand is at Rs 65 for a can, we can look at Rs 40,” added Khambatta.
Currently, the Rs 250-crore energy drink market is occupied by international brands, with some Indian brands such as Zinga and Cloud Nine. “The mass market for energy drinks is vacant. We can grow in this segment,” he said.
The brand has, however, decided to stay away from the packaged water category. “Not many players are making money in the water segment. If we were to enter the segment at all, it would be in a niche category such as flavoured water,” said Khambatta. A separate sales and distribution network is being created for the company’s entry in beverages, he said.
Today, Rasna is a market leader in the powder fruit drink category with 85 per cent share. However, of late, there has been increasing competition from MNCs, such as Cadbury Kraft (Tang) and PepsiCo-owned Tropicana, also entering the fray with renewed aggression.
Rasna has assigned Rs 35 crore ad budget for the summer with a slew of campaigns (created by boutique agency Curry Nation). However, it is not jumping on the IPL bandwagon. “We are waiting for ad rates to go down even further for the tournament. Last year, we had bought spots for the last few matches towards the end of the tournament,” said Khambatta.