In times when the consumer sentiment seems to be slipping by the moment, one of the brands that has offered some solace to the market by continuing to remain upbeat is Castrol India. We, at Pitch, have attempted to find out what are the essential ingredients in this perfect blend that keeps pumping the No 2 lubricant player’s spirits and the bottomlines, continuously. The value-for-money proposition is doing the trick for the lubricant company as its marketing director AS Ramchander admits, “we offer consumers powerful value for money propositions which become even more critical to consumers at times like the current economic environment.”
Through the last 100 years, Castrol has been a trailblazer in the domestic lubricant industry, setting the standards in technology and innovation in everything it does. “The Castrol master brand provides the overall credibility and trust, or what we call the ‘Magic of Castrol’”, quips the marketing head honcho. The lubricant major has been operating here for a century now with the first overseas branch office of CC Wakefield and Company (as the company was then known) opening in its office. Ramchander further adds that the brand is working with a lot of partners. “We are working with our partners, and customers to support them in every which way we can during these difficult periods and we are confident that together we will be able to ride this temporary setback to the global economy,” says the marketing head.
The overall lubricant market is pegged close to a billion litres, according to industry estimates, out of which Castrol commands a consolidated market share of 19-20 percent, including both automotive and industrial segments. But Castrol is the market leader in the automotive retail segment with a share of 29 percent, and its volume share in the overall automotive market is 22-23 percent, while its value share is pegged at around 30 percent.
The Brand Prowess
But in a scenario where brand preference plays a vital role and with the category becoming a fast moving category what is it at the marketing front that Castrol has been doing right? Sharing the blend for this, Ramchander attributes the brand’s successes to its four pillars, namely strong brands, continuous innovation, passionate people and enduring relationships.
Beginning with brands, Ramchander feels that there are not many brands which have been able to sustain for as much as over 100 years. This, he attributes to the fact that the products from the Castrol stable have established positions as market leaders, mainly thanks to their value for money propositions and the fact that these are backed by compelling communication over a sustained period of time. For instance, during the decades of 80s and 90s, Castrol was the only lubricant brand in the country to use advertising to promote its brands. In fact, not just this; according to the marketing director, the brand has many firsts in lubricants marketing here —Castorl is the first lubricant company to advertise its brands; it is the first to advertise on radio and television, the first to use brand ambassadors; the first to do rural advertising; and the first to use a brand testimonial campaign in the lubes business among others.
With all these marketing efforts in place, the company has been able to achieve a high recall as Ramchander says, “Castrol brand enjoys 95 percent unaided recall amongst its TG.”
The brand has also been an active participant when it comes to sports sponsorships—be its association with cricket, or motorsports. Its belief in sponsorships as a reliable source of building brand equity stems from the philosophy that sponsorship actually helps it to bring alive key performance or emotional attributes of the brand such as power, superior protection, leadership etc and cannot be seen just as a recall tool. As Ramchander says, “we believe that sponsorships helped us create the ‘halo’ effect and definitely enhance our brand value.”
Talking about the marketing mix, he is quick to point out that there are several other elements in the marketing mix which contribute to higher brand recall, out of which some are more than sponsorships.
Accepting the fact that lubes are a low-involvement category for consumers and keeping consumers interested is a big part of the marketing puzzle, Ramchander accepts that at times this does pose a serious challenge. The brand has been following different communication strategies for the different sets of audiences depending on the level of involvement with the product. “Across all segments, the involvement is definitely lower than say a ‘personal’ product and hence we undertake various activities to keep our customers and influencers engaged and updated about the new technologies as well as the various product benefits that we offer and how these impact the maintenance and operation of their vehicles,” he informs.
Another major TA for the category is the influencer. Therefore, the brand has involved in a dialogue with them, as it has been observed that the recommendation of an influencer plays a pivotal role in purchase decision. Ramchander feels that it becomes important that the brand uses product brand advertising, sponsorships, consumer education and contact programmes and influencer training to keep the brand as well as the lube category relevant to the TG. Hence the brand has worked on various communication programmes to communicate with the influencer community. “We consistently communicate with the influencers to keep them updated about the latest technologies and product benefits and also to seek their inputs on what they’d like to see in product development. In addition, we run specific programmes for them to enhance their category expertise and also provide them with training. Our influencer programmes like Castrol Bike Point, Castrol Car Care, Castrol Pitstop and Castrol Golden Spanner have been highly successful in this regard,” informs Ramachander.
Casting its Reach Far & Wide
Moving on from one ingredient of the marketing mix of promotion, the lube giant has also paid a lot of attention to its placement and distribution over the years, as it focused on setting up alternative routes to penetrate the markets in a nationalised economy. “Castrol set up an alternative route to the market called the ‘bazaar trade’ which constitutes today’s retail market and is the largest distribution channel for the industry,” shares the marketing head. Interestingly, these developments took place at a time when the main ditribution channel was filling stations.
Over the years, Castrol has made further progress in terms of innovating when it comes to creating and harnessing newer distribution platforms. According to Ramchander, Castrol has expanded its routes to market through various new channels like supermarkets and ITC e-Chaupals and set up its own channels like Castrol Pitstops, Castrol Car Care Centers, Castrol Authorised Service Associates and of course the biggest step out initiative – Castrol Bike Zone—a franchised servicing workshop model for multi-brand motorcycles. He feels, “we are continuously looking at ways to expand our network and availability and towards this end, and we have developed several offers in the car and motorcycle spaces so far.”
The lubricant major boasts of a hefty network of around 280 authorised distributors who in turn redistribute its brands to over 60,000 dealer-points across the country. The company’s innovative initiative under the Bike Zone, which is a multi-brand two-wheeler service centre initiative built on modern retail format, can also be seen as a bid that would deepen the brand’s roots with retail customers and as an attempt to explore opportunities in adjacent areas, which would further its reach.
Future & Challneges
One of the biggest threats that a lubricants face is that of counterfeit products, and brand Castrol is aware of the menace and engages in a lot of activities to counter it. Accordingly, the company has undertaken anti-counterfeit communication efforts. “From time to time we’ve communications for our trade and consumers keeping them informed about the anti-counterfeit efforts we take and educating them on how to check and ensure they are getting genuine product,” says Ramchander, adding apart from this, the company also does a lot of innovation at the packaging level to address the menace of counterfeit.
Today Castrol is the market leader in most segments it operates in. This has been achieved by a combination of good marketing strategy, alternative retail channel and effective communication strategy but the brand also identifies the threats and opportunities that it is faced with in these tremulous times. “We believe that there is only one way to build consumer trust and that is to be 100 percent sure on product delivery. Castrol has been here for 100 years now and we’ve never compromised on product quality or consumer satisfaction” concludes Ramachander.