In order to achieve increase in market share, growth volume and profits, sellers compete among themselves. It is done by varying parameters like the product price, product innovation, it's channeling and distribution and several other factors. This rivalry among the sellers is called as the competition. To understand it, we must take into consideration the direct & indirect competitors of the product. Also is essential the realisation of the substitutes available to our product, in the market.
The air care market in India is of about ` 300 crore, compared to the $ 7.5 million market in the U.S. Ambi Pur was launched here in 2002. Back then, in 2006 the air care market was perceived to be of ` 50 crore and growing at an average annual rate of 6.2%. Later that year Ambi Pur's market share rose to 11.7%. Under the JV between Godrej & Sara Lee, Ambi Pur continued to see a rise in it's market share. In 2009 it was 14.1%. Thus emerging in a dominant position with a premium brand in the car freshener category.
The Indirect Competitors: These are the ones that serve the same purpose but may not have the same functionality of the original car freshener product. Odonil from Dabur, hanging perfume sachets by Miracle, other gel based car air fresheners, sprays/ aerosols, perfume dashboard bottles, or even the primitively used car fresheners- incense sticks. They can be from the market followers group that remotely affect the share of the leaders in all aspects.
Rivalry among Industry Competitors: The product pricing clearly discerns the rivalry in the direct competitors in the air care-car freshener industry. Ambi Pur is not only supposed to tackle the competitive prices offered by Aer but also the innovation and designing of the latter.
Potential Entrants: The New entrants in this category are the ones which are adept with the technological improvements that lack in the original product. Their launch as a potential challenger is a result of intense study and observation of the market leader. This car freshener category is always under a threat of new entrants because of the increasing- purchasing power, awareness & standard of living, and due to the car freshener being a quintessential component of the car. One strong barrier against all these new arrivals would be P&G brand name and the customer loyalty towards it's product.
The air care market in India is of about ` 300 crore, compared to the $ 7.5 million market in the U.S. Ambi Pur was launched here in 2002. Back then, in 2006 the air care market was perceived to be of ` 50 crore and growing at an average annual rate of 6.2%. Later that year Ambi Pur's market share rose to 11.7%. Under the JV between Godrej & Sara Lee, Ambi Pur continued to see a rise in it's market share. In 2009 it was 14.1%. Thus emerging in a dominant position with a premium brand in the car freshener category.
The Competitor analysis gives us the distinctive features of the following two competitors viz.
The Direct Competitors: The products that impose an immediate threat because of its more or less similar functionality, packaging and innovation, competitive pricing, and gaining popularity.
The products that lie in this range are usually the market leaders or challengers. For instance: international brand like- US-based home care player and SC Johnson’s 'Glade'. 'Premium'- the domestic brand owned by Helene Curtis India Pvt. Ltd., 'Aer'- belonging to Godrej and 'Air Wick'- owned by the Reckitt Benckiser. The last two having a market share of roughly 6% and 8% respectively as of 2012 in their launch years. Out of the above, Godrej Aer is the most relevant direct competitor to Ambi Pur as far as the car freshener product category is concerned. It is the one after Ambi Pur to have started the business of car diffuser perfume system in India, apart from their other household room freshener range of products.
Max-to-max they reach to be the very next challengers but only if they shape their product in the same way as of the ace one.
Porter's 5 force model can be referred for the competitor analysis. The attractiveness of a market or an industry can be studied through it. The 5 forces shown below are explained in detail in context to Ambi Pur's market.
Potential Entrants: The New entrants in this category are the ones which are adept with the technological improvements that lack in the original product. Their launch as a potential challenger is a result of intense study and observation of the market leader. This car freshener category is always under a threat of new entrants because of the increasing- purchasing power, awareness & standard of living, and due to the car freshener being a quintessential component of the car. One strong barrier against all these new arrivals would be P&G brand name and the customer loyalty towards it's product.
Suppliers: In this growing market, there exits several suppliers. From the supplier's point-of-view, car freshener industry is very active, full of potential and attractive. The suppliers are therefore left with not much of a strong bargaining power.
Buyers: It includes the price sensitive target customers. Having a set of option to choose from gives the buyers a power to bargain. Due to a presence of a growing number of buyers, the industry seems to be promising. In order to cater to the price-sensitive customers, Ambi Pur is made available with price promotions and discount schemes on the starter kit and the refill packs.
Buyers: It includes the price sensitive target customers. Having a set of option to choose from gives the buyers a power to bargain. Due to a presence of a growing number of buyers, the industry seems to be promising. In order to cater to the price-sensitive customers, Ambi Pur is made available with price promotions and discount schemes on the starter kit and the refill packs.
Substitutes: There is a huge threat of substitutes because of reasons like- the changing buying patterns, aggressive pricing and monotony of the ace product. Also a greater reason for a consumer to buy a substitute is impulsive purchase in an emergency. Time, cost and the availability factor adds on to it. This leads a buyer to depend on the substitute as an 'alternative'. A consumer might substitute Ambi Pur for a simple Car perfume bottle, Aerosol or even for a Freshener Sachet. For instance, the low cost substitute can have an imitated diffuser system design and functionality. The similar or new fragrances, packaging & promotions. However, the cheap substitute would usually lack in quality, standard and longevity.
Industry Insight:
Industry Insight:
"In a rapidly growing and a new product category, while there is sufficient room for each new player to grow, product differentiation and innovations go a long way in helping a brand score above the rest and establishing a brand recall."
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