Nerolac takes on 'Goliath' Asian paints, looks to challenge market leader

For a brand that is just a year shy of its century, Nerolac has been spinning advertising and promotion wheels with the energy of a newborn. Be it on digital media or on television, the latest spate of ads with brand ambassador Ranveer Singh are hard to miss. And the ads are also unflinching in their examination of the brand’s journey thus far, acknowledging the fact that many consumers still do not think of the brand as a paint for their walls even though their refrigerators, cars and other appliances wear its colours. Time for change, the ads say, hinting to viewers that it is time to move the needle away from the leader in the pack, Asian Paints.

Nerolac, ranked among the country's top three decorative or household paints and owned by Kansai Nerolac, formerly known as Goodlass Nerolac, is keen to establish its credentials with a wider and younger set of consumers. But to do that it has to first position itself as a credible alternative to Asian Paints. 

Grabbing consumer attention

The first move towards that seems to be to put the brand in the reckoning, as its ads seek to do. With Ranveer Singh helming the narrative, they are funny and quirky and stand out from the usual. The latest commercial has Singh making an oblique reference to the category. Singh speaks about how his car and fridge appear brand new thanks to the new coat of paint. But, cutting him short, members of his extended family point out that the paint that is giving them the new look is Nerolac, which is used on most car and home appliances in the country. What works there, he is told, can also work well on the walls at home. So why not try it?

Clearly, Nerolac, say experts, is attempting to join the dots between industrial and decorative paints, hitherto never done before by a paint brand. At a time when marketing action is the highest in decorative paints, namely, during the festive season, Nerolac's unusual advertising approach, say experts, is intended to steal the thunder from market leader Asian Paints. The latter commands over 50 per cent of the estimated Rs 450 billion decorative paints market in India. Berger and Nerolac, on the other hand, are estimated to have a share of 25 and 15 per cent respectively of the market.

While dislodging the leader is clearly not easy, a challenger like Nerolac is left with no option but to take bold bets in its advertising and communication.

“This is a clever tactic by Nerolac,” says N Chandramouli, chief executive officer, TRA, which brings out the annual Brand Trust Report. “It has brought its leadership in the auto and home appliances segments, which is part of the larger industrial paints category, into decorative paints. This way it is telling consumers (of decorative paints) what it is made of. At the same time, industrial paints, which is highly commoditised, also gets some moments in the sun,” he says.

Constituting 25 per cent of the Rs 600-billion overall paints market in India, industrial paints has been traditionally devoid of any marketing activity owing to the B2B (business-to-business) nature of the segment. Decorative paints, on the other hand, which constitutes 75 per cent of the market, sees major brand-building activity undertaken by players at all times in their quest for growth. “Brand building,” says Harish Bijoor, chief executive officer, Harish Bijoor Consults, “is what differentiates one player from the other in a category such as paints. And most of the key decorative (paint) brands have carved a niche for themselves especially the leader Asian Paints, which has played up the emotional aspects surrounding a makeover well. For a challenger the task gets even tougher to displace the leader from his position,” he says.

Framing the challenge

For Nerolac the task is cut out, especially since the market leader is also an energetic campaigner for public attention. Going by the advertising, the two brands seem to be speaking in very distinct tongues; Nerolac is the underdog, while Asian Paints is the leader with a more integrated and larger presence in consumers’ lives. 

Asian Paints has recently unveiled a campaign that shows an elderly couple welcoming youngsters as paying guests after their son moves out of the house. The paint helps make the room warm and welcoming for the new arrivals, who, in turn, help make the home feel like a home again for the couple. 

Asian Paints, say experts, is opting to stay the course with its communication, even as it adopts allied tools to give competition a good run. This includes getting tech-savvy at the dealers' end, setting up cutting-edge experience stores that help consumers to not only pick up the right colours, but also design their homes to pushing home solutions including taking up painting assignments for clients, Asian Paints has closed virtually every loop in the paint value chain, say analysts.

Recent years have also seen Asian Paints diversify into adjacencies including kitchen and bath solutions, water proofing, metal and food finishes as well as adhesives, the latter pitting it against established names such as Fevicol from Pidilite Industries.  A new digital film on adhesives attempts to put Asian Paints' new foray into perspective. It shows how consumers react to a badly-done carpentry job, damaging the reputation of the carpenter.

Amit Syngle, chief operating officer, Asian Paints, says, “Our adhesive range has always stood for a modern and progressive choice. The film takes this message and shows that a perfect job is crucial to earning a perfect reputation.” Given the hold that Asian Paints has on the market, challenger brand, Nerolac, clearly  has some distance to cover.