Hemanth Mohan, the Managing Director and Vinay Mohan, the director in-charge of sales of Mohan Meakin Private Limited are confronted with a rather unusual sense of dilemma, not very common among successors of established business families in India.
The task at hand for them is a possible resurrection of, the now underperforming iconic brand, Old Monk in finding its relevance in the dynamic alcohol consumption market in India.
The brand Old Monk, which once commanded undeniable brand salience, both at the recall as well at the recognition level, is facing a rather challenging present and an uncertain future.
The Mohan brothers, however, have come to terms with the fact that the brand no longer commands the positioning or the value that it once did and are desperate to revive the value in the light of the new marketing context they are preparing to compete in.
The resolve to revive the brand not only stems from the fact that the brand has undeniable iconic value that appeals to the nostalgia in the tipplers market but the notion that Old Monk, as a brand, spells uniqueness in presenting itself to the enthusiasts cutting across demographic and psychographic boundaries. This resolve, however, has to pass the test of time and overcome challenges that the brand has to encounter for the first time in an ever-changing market space.
The challenges the Directors are facing now are rather different from what the founders of the brand had faced all along. Despite being one of the trusted rum brands with excellent price attractiveness, Old Monk is unable to fight back the competition. According to an industry report published by Maps of India in 2019, the price of 750 ml of the Old Monk rum is ₹234. Some of the competing brands have a pricing for the mentioned volume as follows: Malibu—₹650, Bacardi—₹1,100, Captain Morgan—₹780, and Hercules—₹478.
When compared to the other dark spirits, Old Monk does not spend much on marketing and branding but has still managed to stand out because of its heritage value and cult following among both classes and masses.
The competition from foreign brands like Bacardi is enticing the market with its premium image, while local brands like Smirnoff are reacting to the market by developing and presenting innovative value propositions like flavored rum.
This, however, is appealing to the variety-seeking consumer who is even willing to pay a premium and experiment with different flavors. In addition to the changing preferences of consumers of tipplers, it is also noted that more and more consumers these days prefer to drink premium whiskey rather than rum. This trend is observed not just in India but also globally. The consumers of premium whiskey belong to various age groups.
Compounded to the given set of challenges, Hemanth and Vinay Mohan are facing another challenge of negative perception being built around rum consumption among middle-age and health-conscious consumers.
This negative perception is due to the various articles associating the consumption of beverages with higher alcoholic content with increased risk of diabetes.
An article published by UK’s National Health Service (NHS) titled “Diabetes and Alcohol” warns its readers from drinking beverages with higher alcoholic content such as whiskey and rum on empty stomach because it might increase the risk of diabetes.
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