KOLKATA: From hotel to perfumes, ITC has managed to expand its presence in fragrance business by introducing newer categories and enhancing its portfolio this year. At BSE rising 1.77 per cent the hotel mogul has turned out to be the second largest player in the deodorant and body spray market.
The tobacco-to-hospitality conglomerate has just forayed into perfume spray segment, and established itself in deodorant and cologne spray segments with its new brand – Engage.
Sandeep Kaul, chief executive at ITC said -“We think fragrance is a category where there is huge potential for consumption to increase through adoption by new consumers”. As the margins are high at 18-20 per cent, it can also help the company achieve breakeven in its personal care business faster.
Nielsen the market tracker, reviewed that the overall growth in consumer spending on deodorants and body sprays had declined to 5 per cent in 2015, but it went up by 25 per cent for ITC. The panel further mentions a 10 per cent share in deodorants for ITC in December, with leaders like Vini Cosmetics’ Fogg at 16 per cent and No. 3 with Park Avenue at 6.5 per cent. The overall market is Rs 2,300 crore.
Kaul said the slowdown in fragrance market is due to consumers limiting their purchase to not more than three bottles a year, which is expected to improve. He further mentioned that “This is an opportunity for us and we are widening our portfolio,” .
ITC plans aggressive digital marketing push for its latest launch – Engage perfume spray. The company has tied up with Google to roll out a consumer campaign where couples can send customised video notes to each other on a real time basis. Kaul said this campaign will help the brand overcome advertisement clutter and increase engagement.
He said the company is aiming for market leadership in fragrance business.
The focus on fragrance business comes at a time when ITC is pushing its other businesses hard to reduce dependence on cigarettes. Since legal cigarette consumption has come down due to recurrent price increases triggered by higher taxation, ITC is chasing a goal of achieving Rs 1 lakh crore revenue from non-cigarette FMCG business. Its packaged food business has elevated and already become profitable.