'People from different backgrounds are trying to bring in new thinking to cement industry'
Neeraj Akhoury, CEO India Holcim and Managing Director & CEO of Ambuja Cements, delivered the keynote on 'Building a Greener India,’ at e4m’s Pitch BrandTalk Conference
At e4m’s Pitch BrandTalk, Neeraj Akhoury, CEO India Holcim and Managing Director & CEO of Ambuja Cements Ltd delivered the keynote address on the topic - ‘Building a Greener India’.
Commencing the session, Akhoury stated that India is the second largest cement industry in the world after China. “Smaller as we may sound, we are the second largest in the world, just after China. And more importantly from a marketing perspective, we have about 100 plus players in this industry, with an industry turnover of roughly about 175,000 crores. If you look at cement at one end of the spectrum, it's a pure commodity play, where many people in this industry believe that it's a commodity and therefore, we need to figure out how to master this game of commodity and how to make money in this commodity business. There are many reasons for saying so, one is that there is a huge product parity, there is a huge distribution parity, logistics parity and product parity, and everything is ruled by BISO. So many of us believe that it is a pure commodity. But then on the other end of the spectrum, I think it's also important to see that it does travel long distances to become very close to a brand. And especially when you talk about the marketplace where the difference between a brand A and a brand B could be as high as 10%, realize that there is a lot of play for somebody to be operating at the lowest part of the price spectrum and somebody to operate at the very high part,” he said.
Highlighted what many marketers and people from different backgrounds are trying to do, he said, “Many people, even from different backgrounds, are also trying to bring new thinking in this industry, which was earlier known to be a pure commodity play. So, about 65% of the market is what we call individual home builders, which is where B2C game happens, where the brand game happens mostly, and then the balance is what we call the B2B or infrastructure or industrial segment and so on and so forth, where more of tender procurement happens.
Having said that, in no way in that segment, there is no brand or no value proposition. In those segments also, there is an element of brand and value propositions working. But this profile of this individual home builder is very interesting, typically a male or female of 35 years plus spread across locations in urban towns, in the remotest villages of India, within semi urban locations, outside the town, inside the town, they are everywhere. Somewhere you find the husband is leading the entire procurement or purchase decisions, somewhere you find the lady of the house is who is taking the entire procurement decision.”
Speaking about the factors impacting a brand, Akhoury shared, “In most parts of India, we have built a home once in our lifetime, sometimes also twice but mostly it is once in a lifetime. And then it takes one year to two years of time to build a home and hence in that two years’ time, his total purchase will be around 5 lakh rupees, he’ll be purchasing about eight times to twelve times. So these are some of the factors which impact the brand, the sale and the branding of this product. What is also important is that in this eight to 10 times of his purchases, he is also used to switch brands, so, we are here because in our category when we say overall home, we have got flooring, foundation, walls, roofs and there are brands which go around to say that we are good for the roof, good for the foundation or the walls. But what is important and for us as brand marketers of cement is really understand the intent of this into your home builder and we believe that this is his signature to his life.”
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