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Sunday, March 26, 2017
 
 

How private capital is trying to solve a social problem

 

Promises of clean drinking water have been regular. Results however have been disappointingly random. Enter private players. Their mission: Spread the 'Clean' word, sell some 'Clean' water engines, make some 'Clean' bucks
ANIRUDH RAHEJA | New Delhi, November 22, 2013 16:56
Tags : Water Purifier | Eureka Forbes | Kent | |
 

It is almost always the biggest promise that we hear new politics make in India. And when politics does, capitalism can’t be far behind. Can it? Clean drinking water in India sounds more an innovation for the privileged than for the masses. Think of the typical Indian who lives in a tier II or III town. For him, this ‘clean liquid’ promise of politics and capitalism hasn’t meant much over the years other than... well... a promise. What’s clean drinking water for him? For decades, he has been fighting to make his vessels blacker than black in an effort to boil whatever he can fetch in the name of drinkable water. Not that she can’t afford a branded bottle of drinking water now and then. But trusts she the promises of these commercial giants little. And her belief isn’t far from reality. Recent data from the government of India shows how 1 of every 10 packaged drinking water bottles available in the market fails to pass quality tests, making matters more complicated for even those who swear by the chemistry of man-made processes to deliver safe consumable water.

 

The 12th Five-year plan of the Indian government focuses heavily on solving waterborne challenges. Yet, as of date, safe drinking water is still out of reach of more than 4.64 crore people and that majorly comprises those in rural parts.

 

But there is hope still. Or so would the players in the business of water purification would have us believe. As per the report titled “India Water Purifier Market Forecast and Opportunities 2017 ”, at a valuation of Rs.3,200 crore, the segment is poised to grow at a CAGR of 25%. It is expected to surpass Rs.7,000 crore mark by year 2015 owing to the increasing awareness amongst Indians and rising disposable incomes of the common class. All this means more pure water to be made available to the masses in India in the years to come.

 

There is hope when there is despair. This is true in the water purification market in India. At present, there is low penetration of electrical purifiers in the Indian market – less than 16% use it as compared to 40% who use non-electric components. Speaking on the huge latent demand for the electrical segment, Marzin Shroff, Senior VP, Eureka Forbes, tells the magazine, “People need specialised and customised purification solutions that retain the essential nutrients in drinking water that are essential for good health. We have steadily monitored the changing water quality across the country and there is a need for not just pure but healthy drinking water. The demand will only rise in time.”

 

Where relatively new brands like Tata Swach (of Tata Chemicals) and Kent are predominantly focusing on home purifier solutions, the leader Eureka Forbes is now shifting gears towards larger scale target groups. They are now targeting communities to set up their exclusive water treatment plants with real time assessment of water contamination. Where the product range in the purification business starts as low as Rs.1,500 for non-electric water purifiers, the range shoots up to about Rs.18,000 for a 'Reverse Osmosis' (RO) purifier. But these advanced form of water filters don’t come without a drawback. Just to deliver a glass of clean, clear water, these expensive resources waste 7-8 glasses (including essential minerals dissolved in water). Aquaguard, the long nurtured brand of Eureka Forbes has launched “Enhance GreenRO” to rectify this problem of water wastage.

 

Talking about spreading awareness, brands like Tata Swach, Kent (which has recently launched 0% wastage RO technology) and Aquaguard have been working hard to create awareness about safe drinking water. Call it a shot at spreading word about their own brands using BTL, but to be fair, every player is doing his bit to make the ultimate consumer understand the right product depending on the level of water contamination.  This exercise to say the least, has also helped grow the overall market of electrical water purifiers. There is however a bigger competition for these organised businesses – their much hated counterparts, the unorganised market. Players in the latter market offer RO machines at a relatively lower price. Machines in this segment start at around Rs.5,000 – and in a price sensitive market, this price war is something that the organised heads cannot ignore.

 

In order to expand the product portfolio across price points, marketers are also focusing more on visibility through on-ground activities. Social media touch points have also made themselves heard in these circles. For the youth that spends quality time over the Internet on a daily basis, companies are offering engagement content, especially on events like World Environment and Water Days. “Social media is definitely one way to ‘spread the word’, and with more and more people becoming active on social media, just sticking to traditional media like TV, radio, print, et al will not sort the purpose,” opines Mahesh Gupta, Chairman, Kent RO.

 

As per a recent survey by Eureka Forbes and GFK Research titled, Kya apka paani beemar hai? (Is your water sick?), 1 lakh people in India succumb to water borne diseases yearly. According to the World Bank, more than 21% of communicable diseases in India are connected to unhygienic water. As per a recent report by WaterAid, 3.77 crore Indians are affected by waterborne diseases annually. Still, only 10% of the urban market stands penetrated by these electric water filters, a figure that falls to a meager 1% for rural areas.

 

So what are players doing to increase their footprint? Tata Swach and Kent (and others) are working on alternate channels to reach out to these unpenetrated and under-penetrated markets. They have been working to establish recall through regional TV channels and newspapers, while being bullish about SMS communication and conduction of road shows to educate masses. Parag Gadre, Head – Water Purifier Business & Strategy at Tata Chemicals says, “Besides the general public, we intend to induce a sense of urgency in this matter amongst corporate sector and public, private industries, as these entities consider promoting low-cost water purifiers as a part of their CSR activities.”

 

Talking about post-sales service, veteran Eureka Forbes at present possesses the biggest network of 1,100 service centres across India. As an answer, others are trying alternative routes to impress potential buyers. Kent assures a turnaround time of less than 24 hours. Others who are less privileged when it comes to network, are banking on celebs and new campaigns to win hearts.

 

Nearly 5 million units of water purifiers are sold in India annually and going forward this count is only forecasted to rise. The ever rising population and simultaneously rising prosperity beyond cities is a good sign. And so is the fact that most in the country don’t have access to clean drinking water.

 

As we said, there is hope when there is despair; perhaps we will see some faction of new politics use a water purifier as its election symbol in the years to come! Perhaps. 

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Issue Dated: Feb 5, 2017