This paper is a bit surprised at the froth that is being generated by at least one side in the 21st century version of the soap wars. After all, companies no longer spar over such things as soaps in these enlightened times; today, the fights have to do with browsers, search engines, social networking sites, electronic readers and smartphones. Colas and soaps, the subject of several corporate battles in the 1970s, 1980s and 1990s, seem to be fairly peaceful categories by comparison. In India, for instance, telcos have replaced consumer product firms as the largest advertisers on television. So, what gives?
Illustration: Jayachandran / Mint
One reason for this may be that something is happening in the soaps (fine, detergents) business. This theory, however, can be safely jettisoned because nothing is, and nothing really has happened for at least the past few years. So why are Unilever and Procter and Gamble (P&G) reliving their heady competitive days?
One answer to this could be the size of the market for detergents that continues to grow. India has enough first-time detergent users who can be swayed by advertising. A growing market engenders competitive activity, and recent efforts by one company to cut prices, gain market share and increase production clearly indicate this. However, even this doesn’t entirely explain the intensity of this edition of the soap wars.
Not all competitive advertising is aimed at customers. Nor are all marketing wars externally oriented. In many cases, such efforts can motivate employees, increase focus on specific markets and customer groups, even serve as a rallying point for efforts by a company to reinvent itself. This could explain the intensity with which Unilever’s Indian arm has responded to P&G’s moves. And it could explain Unilever chief executive officer Paul Polman’s repeated salvos at P&G during a recent visit to India. Both Hindustan Unilever Ltd and Unilever are trying to reinvent themselves; and Polman, an outsider—he moved from Nestle but had previously spent 26 years at P&G—who took over the top job at Unilever in early 2009, is trying to leave his mark on the company.
A bruising competitive campaign could help achieve all three objectives.
If that is indeed the case, it will be interesting to see what Unilever and Polman do next. Marketing wars, like plain wars, are best used as a means to an end.
Is India in the midst of Soap Wars 2.0? Tell us at firstname.lastname@example.org