Do you know how your preference of buying a product affects a business and its competitors? Let's take a situation. If you are sent to the supermarket to buy salt, would you spare any time to decide between Tata Salt, Aashirvaad Salt, or any other brand available? Generally speaking, you wouldn't. You might randomly choose Tata Salt because you saw its unique advertisement sometime back, and it stayed in your mind. This choice of yours increases the sale of Tata salt by one unit in comparison to other brands. This might seem trivial for a small quantity. But yeah, it does make a difference.
The Indian market could be termed as a monopolistic market in most sectors, wherein brands sell close substitutes at a similar price range to a common target customer base. There is undoubtedly huge competition which is inevitable.
And this competition makes companies take a step forward by introducing innovative products, adopting creative promotional activities, and implementing other brand strategies.
India's most notable brand battles
Now let's look at some brands in the Indian market that run their business in close competition with one another.
HUL vs ITC
In the world of FMCG, HUL and ITC are two leading participants. If you look around your house, most of the FMCG products would be from either of these brands. Hindustan Unilever Limited continues to remain the largest in terms of market share, followed by ITC Limited. Both of these are extremely diversified brands.
HUL divides its potential customer base into 3; striving, aspiring and affluent, while deciding on its marketing mix strategies. ITC uses an extensive distribution network which helps penetrate deeper into the market.
HUL's EBITDA(earnings before interest, taxes, depreciation, and amortization) rose at a compound annual growth rate (CAGR) of 13% in FY15-FY20 against 6% EBITDA CAGR of ITC.
The drawback of ITC is that it is primarily into Tobacco; therefore, it pays much higher taxes than any other FMCG brand. This implies reduced earnings after tax.
Swiggy vs Zomato
Food delivery is the most rapidly growing industry in the country. Considering the growth prospects, many companies were established in this spectrum. But not every company could survive.
Two leading companies in this industry are Swiggy and Zomato. While Swiggy was introduced with special services like Swiggy Genie, Swiggy Pop and Swiggy Daily, Zomato focused on the traditional food delivery services with additional benefits like Gold Plan etc.
Though Zomato is still providing discounts to capture the market, Swiggy is focusing on its growth. No wonder why Swiggy's financial statements as of 2019-20 witnessed a 115% jump in its revenue when compared to that of 2018-19.
During the tough times of Covid, Zomato launched campaigns to support the restaurants and delivery partners. Swiggy also launched a campaign supporting various NGOs and delivering meals in COVID-19 relief camps.
These could be perceived as community service or just a disguised promotional activity. What do you think it is?
Cadbury vs Nestle
Being the two leading chocolate brands in the country, Cadbury and Nestle have their share of strengths and weaknesses. Cadbury enjoys a market share of 72%, whereas the market share of nestle is around 24%.
The former has a product for every segment of the market. The latter fixes prices as low as feasible. Also, Cadbury uses aggressive marketing strategies to promote its products.
Both have had their fair share of criticisms for their products as well.
Child labour, mislabelling, the Maggie ban are some of the stones thrown on Nestle. Whereas worms found in their chocolate bars led to a backlash from Cadbury's customers.
Did you know? The purple packaging that Cadbury uses became so crucial that it decided to trademark the purple shade. This was opposed by Nestle, and after years of court sessions, Cadbury wasn't granted the trademark.
Reliance Jio vs Airtel
When compared, Jio is relatively new in the telecom industry. But we are all aware of how it attracted customers and grew.
Jio hit the market with free voice calls and no roaming charges. The data plans were very affordable, which helped it to also include the rural population in its customer base. This forced other operators like Airtel to reduce their charges.
Operating for less than five years in the market, Jio is already leading in terms of market share. Jio launched about 30 apps, including MyJio, JioTV, JioSaavn, Jio Meet etc., accessible on their low-cost Jio phones. But needless to say, Airtel is giving it a tough fight.
For the last few months, Airtel has been increasing its subscriber base. According to a report issued by TRAI, Airtel added 5.89 million wireless subscribers in the month of January 2021, which is 300% more than that added by Jio. Airtel's campaign that strives towards a zero complaint network is proving advantageous.
Pepsi Co. vs Coca Cola
When someone strikes a conversation about brand rivalry, unanimously, one pair comes to our mind. Pepsi and coca-cola.
Launched in India around the same time, these brands have been in cut-throat competition ever since. Even globally, these brands are known for their "Cola Wars".
The 'share a coke' campaign launched by coca-cola proved advantageous as it instilled an emotional attachment in the minds of the buyers. On the contrary, Pepsi focuses on promoting its brand through celebrities and doesn't pay much heed to the sentiments of its consumers.
In the soft drinks industry, both these brands have covered every product line that there is.
Pepsico reported $22.46 billion in revenue, witnessing a 4.8% annual growth, whereas Coca-cola came in at $8.6 billion, a decline of 5.5% from last year.
Myntra vs Ajio
Mukesh Ambani owned Ajio is a fairly new fashion portal in the industry when compared to Bangalore based startup Myntra and many others. Though India's market leader, Myntra, remains to be larger in terms of overall business size, the growth rate of Ajio is impressive.
Some unique features of Ajio are 'Drop at Store with Cash Refund' and 'Pick at Store', 'in-store couponing'; cashing in on their offline stores, Reliance trends.
As of September 2020, Ajio's average monthly visits were at 23.5 million, ahead of myntra, which was only at 21.1 million.
Tata Motors vs Maruti Suzuki
Maruti Udyog Limited was an Indian Government-owned company until 2003 when it was sold to Suzuki Motor Corporation. Thus the name, Maruti Suzuki. It is currently the market leader of the automobile industry.
Tata motors' products are quite diverse. Their product line includes both commercial vehicles and passenger vehicles. They have the largest distribution network and after-sales services centres.
Maruti Suzuki focuses on improving its operational efficiency, whereas Tata motors aims at providing its products at affordable prices. Financially, the former seems to perform better.
Maruti Suzuki's share is traded at Rs. 6,652, whereas a share of Tata motors, is traded at Rs.303.5 as on 15th April 2021.
NSE vs BSE
National stock exchange is the largest in terms of volume being transacted in, whereas the Bombay stock exchange is the oldest stock exchange of India.
Confused seeing these in the list? Let's simplify. The stock exchanges are basically like marketplaces where stocks can be bought and sold. There are many companies that are listed and traded on both these stock exchanges.
1,600 companies' stocks are traded on NSE, whereas 3,000 companies' stocks are traded on the BSE. Though the volume is huge in BSE, NSE is preferred because it provides liquidity. Also, in the 90s, BSE lost its credibility due to the famous Harshad Mehta Scam. NSE was a new entrant, and thus investors chose NSE over BSE.
It is at the discretion of the investors to pick and choose the exchange that is providing them the best price.
The rising competition between brands could sometimes force them to compromise on their quality or even adopt unethical business practices. But in hindsight, there are advantages to this. Price fluctuations hardly exist, which enables customers to get products at the best price. The customers have a long catalogue of similar products to choose from. And the companies go a long way in innovation to fight competition.
Hence, it is safe to say, a healthy competition that would do no harm must exist. It would help brands level up their game.
Anyway, which of the brand battles do you feel is the most interesting? Let us know in the comments below.