United Spirits enters non-alcoholic drinks category with Romanov

Two years after floating the idea, Vijay Mallya-owned United Spirits Limited (USL) has entered the non-alcoholic drinks category with Romanov Red Energy Drink.

Romanov Red Energy Drink is a natural drink made of a Brazilian herb, Guarana, and is priced at Rs 75 a can (250 ml). The company plans to use its existing distribution channels and increase tie-ups with modern retailers to sell the product. The energy drink was recently launched in Mumbai, Bangalore, Kochi and Ludhiana. By March-end, USL expects the drink to be available in New Delhi, Kolkata, Hyderabad and Chennai.

Debashish Shyam, business head of USL, said, “While it is too early to comment on consumer response, we are optimistic about the drink’s appeal to consumers given the growing demand, both from non-alcohol users and those wanting to mix it with beverage alcohols such as vodka.”

Culturally, energy drinks are consumed more with vodka. That’s where the company has hit the perfect chord, by launching it as a sub-brand of its popular vodka brand, Romanov. USL is market leader in vodka in India. Its combined share (Romanov and White Mischief) of the vodka market is 89 per cent. More than 1 million cases of Romonov are sold every year, while Red Romanov sold more than 1,00,000 cases in the very first year of its launch. So, the energy drink will find an existing consumer base.

Energy drinks have a huge market of around 2 million cases per annum and the market has been growing above 60 per cent for the last couple of years. In India, the market is dominated by Red Bull and Cloud 9. Cola multinationals such as PepsiCo and Coca-Cola have also entered the market. Pepsi has Sorbet while Coca-Cola has Burn.

Shyam is confident that USL’s distribution will give it an edge. Moreover, the company says those consuming USL’s alcoholic drinks will swear by its energy drink too. “We are looking at 8-10 per cent market share over the next two-three years,” said Shyam. The company plans to advertise Romanov Red Energy Drink through consumer engagement events.

Analysts say the company can get good volumes on the brand equity of Romanov (mother brand), USL’s vodka brand and Romanov Red, the premium vodka brand. “In fact, the primary objective seem to be surrogate advertising,” said Purnendu Kumar, associate vice-president, Technopak.