RadicoKhaitan Limited (RKL) is one of the oldest and largest manufacturers of Indian Made Foreign Liquor (IMFL) in India. Earlier known as Rampur Distillery, RKL commenced its operations in 1943, and over the years emerged as a major bulk spirits supplier and bottler to other spirit manufacturers.The company launched its first brand 8 PM whisky in 1998 and over the years, has created five millionaire brands and over fifteen organically grown brands. RadicoKhaitan Limited is also one of the largest providers of branded IMFL to the Canteen Stores Department (CSD), which has significant business barriers to entry. It has been successfully building its brand equity in international markets and currently exports its products to over 85 countries.
Amar Sinha, Chief Operating Officer, Radico Khaitan Limited in an exclusive chat with MediaNews4U spoke on the challenges facing the industry due to the pandemic, navigating through the crisis, and on their recent campaign …
As the largest manufacturer of IMFL, how has the journey been for RadicoKhaitan?
To start a business from scratch, you’ll need a lot of grit, dedication, a clear vision, and strong leadership. We had Dr.LalitKhaitan’s (Chairman and Managing Director) vision, firm philosophy, and meticulous thinking that turned the not-so profitable Rampur Distillery into India’s largest IMFL manufacturer. With time, the company has evolved from being a distiller of spirits for others to a leading IMFL manufacturing company with a highly reputable product portfolio.
Our first taste of success was when we sold a record one million cases of 8 PM whisky, which was the first brand from RadicoKhaitan and introduced in 1998, in the first year of inception. The product also made it into the ‘Limca Book of Records 2001’ for this remarkable achievement. In 2006, we launched Magic Moments Vodka after analyzing and observing consumer preferences thoroughly in different parts of the world. It went on to capture more than half of the category’s market share, establishing itself as the industry’s undisputed leader and a category driver. Within two years after its first release, we released a number of flavors under the brand Magic Moments Remix, and in 2012, released the premium brand extension called Magic Moments Verve.
After mastering the art of creating iconic brands over the years, we embarked on the journey of ‘Premiumization’ that led to the creation of iconic brands in the history of the liquor industry. We ventured into the Premium/ Super-premium IMFL category with the launch of Morpheus XO Brandy in 2009, which is now a successful PAN India brand with a market share of over 60% in the premium brandy segment and has the largest national distribution with a footprint across 23 states across India.
In the recent past, we launched a host of premium brand extensions for Magic Moments Vodka called Magic Moments Verve Vodka, 8 PM Whisky’s called 8 PM Premium Black Whisky, and a new rum called 1965 Spirit of Victory Rum; these brands received acclaim in the marketplace. We further cemented our position and tapped into a few new categories, including Single Malt and Gin, in 2018 by launching Jaisalmer Indian Craft Gin and Rampur Indian Single malt. We mesmerized the Indian consumers and brought a delightful experience to connoisseurs worldwide, endorsing Indian brands in the International markets. These brands bagged some of the most prestigious global accolades in the initial launch year itself. Today, Rampur Indian Single Malt Whisky has been ranked No. 1 New World Single Malt Whisky by the Whisky Advocate Magazine and no. 5 in the top 30 Whiskies of the world.
Our dominance in the liquor business is visible in the Defence/ CSD market also; being the largest supplier in the defense canteens, we have a market share of over 30% in this space. We have successfully built our brand equity in international markets and export products to over 85 countries. With a total capacity of over 157 million liters, the company operates 28 bottling units spread across the country. Currently, we have five millionaire brands which are 8 PM Whisky, Contessa Rum, Old Admiral Brandy, Magic Moments Vodka, and 8 PM Premium Black Whisky.
After the success of our luxury liquor brands, we expanded our premium portfolio in both the white and brown spirit categories by launching ‘Magic Moments Dazzle Vodka,’ a luxury brand extension of signature brand Magic Moments Vodka, and ‘Royal Ranthambore Heritage Collection Whisky’.
Can you take us through the strategy for the recent launch of “Celebration Pack” for Morpheus?
We launched the ‘Celebration Pack’ for Morpheus, India’s largest selling premium brandy, to reinforce brand recall and target potential customers. The limited-edition pack was launched across Delhi, Uttar Pradesh, Telangana, Pondicherry, and Karnataka in the first week of 2022. Moreover, we wanted to bring cheer in these unprecedented times to mark the festive season. We came out with a one-of-a-kind bottle inspired by the shape of an inverted Goblet (Brandy Bubble), which is the product’s most intriguing feature aside from its exceptional blend. The pack stands out for the customer’s thanks to its dazzling appearance and creative packaging. The celebratory pack is also a nod to the art and crafts community, commemorating a decade of divinely crafted blends.
We rolled out a 360-degree campaign to strengthen the launch of the Celebration Pack with NidhhiAgerwal, a South Indian and Bollywood actor, as the official brand influencer. A host of offline and online initiatives are underway to amplify the reach of this pack. Morpheus is a hallmark brand for us, and the product’s luxurious character allows a more heightened experience for the consumers.
What was the strategy behind using a female Superstar – NidhiAgerwal? Marketing innovations for this campaign?
By making her the face of Morpheus’ digital content, we will leverage her popularity in South India. We aim to engage with her fan base and broaden our young consumer base. Another reason was that the Indian brandy market is heavily concentrated in the south, with the south accounting for more than a third of the market by region consumption. This is the first time the company has signed an influencer to increase digital footprints. Due to digital transformation, companies are adjusting their business models and are adapting to the new market reality. Also, collaborating with influencers allows businesses to cut through the clutter and attract new customers. It also raises the brand’s visibility and helps develop relevant online conversations.
In the new normal what is the market scenario of the Alcohol industry in India and what are the challenges?
As a result of lockdowns and safety concerns, we saw a consumption shift from on-premises (bars, pubs, restaurants) to in-home consumption. The industry noticed an intriguing shift in consumer behavior, as they were eager to experiment with consumption while at home; it’s fascinating to watch how people experiment with beverages they may not have had previously, such as artisan whiskey, craft rum, and craft gin.
Premiumisation is another key trend that has accelerated with COVID; the shift occurred because people saved money by not going to bars/restaurants; people could afford to go a notch up in liquor selection with the same amount. Consumers are looking to create an experience out of their drinking time and are hunting for quality over quantity.
The pandemic hit certain industries hard, Alcohol was one, and how did you navigate through the crisis?
We managed to keep our spirits high throughout and left no stone unturned to keep the business running. First and foremost, we focused on strengthening our brand portfolio and continued to launch brands in premium categories which will certainly contribute to the overall company’s growth. During the pandemic, we also launched two of our most ambitious products in brown and white spirit categories – Royal Ranthambore Whisky and Magic Moments Dazzle Vodka. We re-evaluated and refocused our sales promotion and advertising strategy; it resulted in a further increase in digital marketing spending. We focused on creating meaningful, engaging, and entertaining content to grab the attention of the brand loyalists and potential customers.
What are the trends you are seeing when it comes to the marketing of Alcohol brands?
In the current scenario, digital media has broken all the barriers and is the lifeline for people. With digital consumption skyrocketing, more people spend time online to keep in touch during the lockdown. While the digital and social media channels will remain relevant in times to come, the technique and style of storytelling will evolve. We are also noticing that influencer–led campaigns are becoming a crucial part of the marketing mix. Moreover, promoting alcohol brands on OTT platforms is becoming a norm nowadays. We are focusing on a digital-first approach for most of our marketing initiatives.
In India advertising of alcoholic beverages has been prohibited since early 2000?
In India, advertising of alcoholic beverages has been prohibited since 2000. At the beginning of the ban, it has been quite challenging, but we have been successful in promoting products through traditional and electronic media with innovative style and marketing strategy. Content marketing has emerged as a key element in our marketing mix. We devote a major portion of our current marketing budget (about 30%) to the generation of content for digital and electronic channels. Prior to the shutdown, our marketing budgets were evenly distributed across all platforms. However, with a growth in the amount of time people spend online, our focus has switched to digital. Currently, we spend approximately 60% of our marketing expenditure on digital channels. In addition to our advertisements and campaigns, we do music festivals like Sunburn Music Festival and other events to engage the youth, especially millennials.
Branded content has worked well for us and the industry. We create content that our audience wants to see. For example, our music partnerships with DJ Aqeel where he played live music on the official Instagram page of Magic Moments, Tales Behind the Cocktail series and collaborations with stand-up comedians. Apart from this, we have been associating with music festivals such as Sunburn for the last 4 years. Another successful collaboration we did was with Knox Artiste, where he released another viral #MagicMomentsFlashUp in Dubai UAE on Valentine’s Day for all the music lovers.
To honor our defense forces and to raise everyone’s spirit during the pandemic, we came out with Shukriya, a gratitude song under the banner of Spirit of Victory. Before this, we were associated with Tales of Valour, a series of authoritative factual war documentaries which depict the 10 most valiant stories of bravery. Another successful campaign we released was the Battlefield Dossier on the occasion of the Indian Army Day which commemorates the soldiers who lost their lives saving our nation. Recently, we released the 2nd season of the Battlefield Dossier with compelling narratives by Lt Gen JBS Yadava (Indo-Pak War 1971), Brig OP Yadav (Kargil War), Brig Manoranjan Singh (IPKF-Operation Pawan), Lt Cdr Deepak Agarwal (IPKF-Naval Rescue Operation) & Col SC Tyagi (Kargil War). One more digital campaign relatable for youth was #RantItWithMagicMoments featuring Actor Sunny Singh, which was a series of three films capturing how youths get rid of stressful situations after a sip of Magic Moments.
What is the market share for IMFL in India? What is RadicoKhaitan’s market share?
ICRIER (Indian Council for Research on International Economic Relations) reported that India has one of the fastest-growing alcoholic beverage markets in the world. The estimated market size is 3.9 lakh crore, and it would grow at a CAGR of 6.8 percent until 2023. RadicoKhaitanLtd’s market share in the IMFL category is approximately 7%.
What are the marketing initiatives for the brand in general, as today digital is the front runner?
We focus on creating meaningful, engaging, and entertaining content to grab the attention of the brand loyalists and potential customers. We believe that Content marketing has to be crisp and concise to capture the shrinking attention span of audiences, especially on digital platforms. We have invested in creating infotainment content that entertains and educates the users.
We engage with brand loyalists through various events, music, and film festivals. Celebrity engagements and influencer marketing have also helped us connect with our consumers. We have left no stone unturned to reach out to customers, from roping in Bollywood star Tiger Shroff for 8 PM Premium Black (Music CDs) to actors Kartik Aryan and Jaqueline Fernandez for Magic Moments Music Studio, and NiddhiAgerwal for Morpheus – Dare To Dream.
One more digital campaign relatable for youth was #RantItWithMagicMoments featuring Actor Sunny Singh. We carried out exciting contests on social media platforms for our brand loyalists to win amazing prizes by sharing videos of their rants on social media by using the above hashtag; this activity garnered a lot of engagement.
