Compact cleaner

FMCG giant Hindustan Unilever has launched Pureit Compact, a new product in its Pureit range of water purifiers. With this, Hindustan Unilever claims it straddles the entire consumer segment. It has in its portfolio Pureit Classic which is priced at Rs 2,000, Pureit Autofill at Rs 3,900 and now Pureit Compact which is priced at just Rs 1,000. Next on the company’s drawing board is a new in-wall version which will be known as Pureit Marvello.

Pureit Compact will address a completely new segment of consumers — those who could not afford a water purifier earlier. “This innovation makes Pureit accessible to a larger group of consumers without any compromise on the standard of water purity,” says a company official.

Hindustan Unilever entered the water purifier market in 2004 when it launched at a price as low as Rs 2,000. At that time, domestic water purifiers in India consisted of expensive ultraviolet and reverse osmosis purifiers. Many of these were beyond the reach of most consumers. Then there were low-end candle-based water filters available in the market but these did not ensure 100 per cent germ-free water. Hindustan Unilever’s research showed that as a result of these barriers in accessing safe drinking water, most consumers in India boiled water to make it safe for drinking.

Thus was born Pureit that cost less than half of what other purifiers cost. For one litre, it would cost the consumer 35 paisa to purify, compared to 47 paisa for boiled water and 64 paisa for high-end water purifiers. Pricing it low worked for Hindustan Unilever which has sold more than 3.5 million units in the past six years. Pureit is sold directly and also through the about 15,000 retail outlets across India.

The cost of water purifiers — acquisition as well as maintenance — has been too steep for poor households. But that is changing now. Apart from Hindustan Unilever’s Pureit Compact, Tata Chemicals has launched Swach at price points of Rs 749 and Rs 999. Developed jointly by Tata Chemicals, TCS and Titan Industries, it is aimed at the bottom of the market. Ever since Tata Chemicals announced its launch last year, the market has been rife with speculation that Hindustan Unilever will soon come out with a competing product.

For its part, Hindustan Unilever’s trump card is the Environmental Protection Agency stamp, the toughest drinking water regulatory agency in the United States. This sets it apart from Swach. Tata Chemicals has a wide distribution network from which it can sell Swach. It will also depend on other Tata companies like Rallis, the company’s farm retail business, as well as some non-profit outfits for distribution. All this, Tata Chemicals hopes, will help it sell one million units a year and three million units a year in the next five years. Can Pureit Compact help Hindustan Unilever face this substantial challenge?