12 BRAND WORLD

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MUMBAI | WEDNESDAY 27 JUNE 2012

Pharma brands: Old is gold

As many as 260 out of the top 300 brands are pre-2005 vintage
TOP 10 BRANDS
Company Brand Use Launch year Age

Unlucky 13 at the Riviera

What were the reasons for the relative non-performance of Indian ad agencies at Cannes this year?
'Vodafone Pug' ad has come within sniffing distance of a metal despite their local success. However, expectations rose, in an irrational sort of way, fanned and fuelled by the barrage of Cannes predictions in every publication. Lesson No. 2: We are technological pygmies: Its a telling reality. The West and Japan have learned to integrate technology into communication, almost as an operating principle. They look at technology as an investment and are willing to spend more time and money on execution. In India, the dynamics are different. Our campaigns get much shorter gestation times. definition of creativity is changing at Cannes every year. Creativity is no longer for creativitys sake. It is now measured in terms of impact. It should make a difference to the world around you. Clever creative ideas are good enough to get shortlisted. But clever creative ideas with the ingredient of effectiveness can win big metal. If you can get the Prime Minister of your country to notice and comment on your campaign, it stands a better chance of winning. In other words, a Cannes Lion is turning into a global Effie award. Creativity with a bit of activism thrown in. Thats why Vodafones iFold (in direct marketing) or I am Mumbai for Mumbai Mirror in film craft struck metal, not Fox Crime or the Volkswagen Jetta Wings commercial. Lesson No. 4: United we win, divided we lose: Marketing matters. The unity of entrants of respective countries also matters. At the Oscars, an entrant uses marketing techniques to ensure that juries form an opinion about his work much before the actual judging happens. At the Cannes Lions too most of the jurors know the good work from most parts of the world barring countries such as India and Vietnam. Just like the film folk, our Khans of Indian advertising cant unite and ensure big metals for India at the place where it matters the most. Meanwhile, the Brazils and Portugals of the world make sure the book of their potential entries reaches every juror in advance. So even if a juror is playing Temple Run while judging, he doesnt miss their entry. And it makes it to the shortlists.
The writers are founder directors of Scarecrow Communications. Bhatt was also a juror at Cannes this year

Abbott Pfizer Novartis Abbott GlaxoSmithKline Ranbaxy Aristo Pharma Franco Indian Alkem Himalaya Drug

Human Mixtard 30/70 Corex Voveran Phensedyl Cough Augmentin Revital Monocef Dexorange Taxim Liv-52

Anti-diabetic Respiratory Pain / Analgesics Respiratory Anti-infectives Sex stimulants/ Rejuvenators Anti-infectives Gynaec Anti-infectives Hepatoprotectives

1992 1993 1986 1996 1994 1989 1990 1999 1989 1989

19 18 25 15 17 22 21 12 22 22

market and life cycle management can carry brands through their leadership cycle for more than 25 years. Classic examples are Voveran, a nonsteroidal anti-inflammatory drug (NSAID) for osteoarthritic conditions and Calcium Sandoz for strong bones and Otrivin a nasal decongestant, says Shahani. Novartis had launched Voveran as a tablet, which was followed by a gel formulation and later a thermagel. The idea was to capture an additional market segment at each stage. MNCs Vs domestic firms Multinational companies (MNCs) have excelled in the act with better brand building capabilities, notwithstanding their relatively limited market share. Foreign players such as Abbott, GlaxoSmithKline, Novartis and Pfizer account for five of the top-10 brands. Given their historic strategic constraint in terms of fewer product launches compared to local players, MNCs have focused on building these limited launches into big brands. This bodes well for future as MNCs seek to broaden their portfolio through branded generics and patented products, the study said. Abbott, which leads the top-300 list, now has 28 brands in that bracket aided by its acquisition of Piramal Healthcare. However, some of the Indian companies are also gearing up to create a meaningful place for themselves. According to analysts, Mankind has emerged as the biggest brand creator in the pharma space in the last few years. Says R C Juneja, Chairman and Chief Executive Officer of Mankind Pharma, brand is like a lifeline for pharma companies. More brands not only mean more profit, it also means that your company is becoming more popular and this is very important for drug makers. Since 2000, the company has built 12 brands in the top-300 list highest in the domestic market and surpassing even the largest players. Of Mankinds 12 brands, 11 are in the acute segment including five antiinfectives brands. According to Juneja, brand building is a challenge and companies have to formulate product specific strategies to position their brands well in the market. The field force also plays an important role here, he points out. Other domestic players like Cipla, Cadila and Elder Pharma also have successful brands in the pharma market.

POST-MORTEM
RAGHU BHAT & MANISH BHATT
Lets face it. In terms of awards won, Cannes this year was a huge disappointment. Just 13, if you take into account the metals haul of Indian agencies, 14 if you include Bacardis win in the Brand Content & Entertainment segment. What compounded matters for us was the magnitude of expectations before the event. After all, Indian agencies walked home with 24 metals last year. And barring the odd year like in 2010, when we walked home with 17 metals, India has had a good outing at Cannes in the last few years. So what were the reasons for this relative nonperformance? Why did some of the red-hot favourites fail to strike a chord? Lesson No. 1: Dont get carried away by Goafest success: Many of the socalled contenders were big winners at Goafest. Amongst these were highly popular local campaigns like Har Friend Zaroori Hai or technological breakthroughs such as the Audi 3D campaign. It's a known fact that popularity at the local level does not necessarily translate into big metal wins at international shows. It never has. Neither the Lalitaji Surf campaign in the 1980s or the Coca-Cola Paanch campaign in 2002/03 or the

Source: IDFC Securities Research

SUSHMI DEY
New Delhi, 26 June

t a time when pharmaceutical companies are investing billions of dollars to develop new and path-breaking medicines, it is the old and heritage brands that continue to dominate the market. Sales in 2011 show that the average age of the top 10 pharma brands is 19.3 years, and some of them are as old as 25 years. For instance, Novartis painkiller Voveran, which was launched in 1986, ranks third, whereas Ranbaxys much popular health supplement Revital and Himalayas Liv-52, both 22-years old, rank sixth and 10th respectively. According to a study conducted by IDFC Securities on pharmaceutical brands, out of the top-100 brands, 93 are pre-2005 vintage. Among the top 300 brands, its as many as 260. While most of these brands are painkillers, vitamins and cough syrups, even drugs to treat diabetes and those treating gynaecology problems figure among the vintage brands. Matter of Trust Brand building is a matter of trust, high degree of recall and consistency, says Sujay Shetty, Partner, PricewaterhouseCoopers. A brand is built with a lot of investment and it has to be reinforced every year. So ultimately, it is several crore over several decades. Novartis India Vice Chairman and

Managing Director Ranjit Shahani agrees. Brand is a promise and reputation is the delivery of that promise over and over again. Successful brands are built on innovation while block buster brands are built on game-changing innovation, Shahani said. Dominating sales Analyst say mature brands not only dominate rankings but sales are also growing at a strong double-digit clip year-on-year. Despite ageing, top-100 brands, with an average age of 15.8 years, have shown nearly 16 per cent growth over 2007-2011. Similarly, the top-50 brands, with an average age of 17.3 years, have recorded more than 16 per cent growth. Importantly, despite their vintage, the top 10 brands continue to grow steadily with a revenue CAGR of 14.2 per cent over 2007-2011 signifying high brand stickiness, the study said. Rising on a strong brand recall and increasing sales from rural and untapped markets, these brands are huge money spinners. Some of them clocked annual sales of over ~ 200 crore last year, said the brand manager of a leading pharmaceutical company. According to a study conducted by IDFC Securities, Abbotts anti-diabetic drug Human Mixtard, which was launched in 1992 and currently occupies the top-slot of best-selling brands, garnered revenue of around ~ 219 crore last year. Similarly, Pfizers cough medication Corex, launched a year later in

1993, clocked annual sales of ~ 215 crore in 2011. Even older brands like Voveran and Revital clocked significant sales. While Voveran earned ~ 194 crore for Novartis, Revital contributed ~ 182 crore towards Ranbaxys sales last year. Other heritage brands enriching the cash registers of various pharmaceutical companies include popular medicines like Combiflam (anti-inflammatory and painkiller), Benadryl (cough syrup), Calpol (paracetamol), Mox (antibiotic), Liv-52 (for liver ailments) and Shelcal (calcium and Vitamin D3). Branding requirements Most of these best-selling brands in India are off-patent, unlike in the developed countries where the average age of top brands is typically 12-15 years, depending on the length of patent protection. One of the reasons could be because in India, painkillers, cough and cold medication and antibiotics are initially prescribed by general practitioners and over the years they adopt characteristics of over-the-counter products. How many of us really go to a doctor for a Combiflam, a Benadryl or a Calpol? We go straight to the chemist, Shetty said. But analysts suggest that brand building skills are critical and there is clearly a challenge in creating newer brands. Experts say, though a successful brand building is a continuous process and takes decades, a new product needs minimum of six months to develop a market. India is mainly a branded generics

At the Cannes Lions, most of the jurors know the good work from most parts of the world barring countries such as India and Vietnam

Technology is looked as a barrier to speedy execution. The Audi 3D campaign was a giant leap forward in the Indian context. However, compared to the international scenario, it was underwhelming. Lesson No. 3: Creative needs to create impact: The

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THE BS CROSSWORD

# 1211

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BS SUDOKU

# 972

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DOWN
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Rourkela Steel Plant

STEEL AUTHORITY OF INDIA LIMITED

Rourkela - 769 011, Odisha, India

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Registered Office: Ispat Bhawan, Lodi Road, New Delhi 110 003

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There's a little bit of SAIL in everybody's life

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