CategoriesMarketing Sales
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Cocoguru is now available at Reliance SMART Stores

Reliance Smart Puttur
Coconut oil pouches at Reliance smart

We are extremely pleased to announce that Cocoguru coconut oil is now available at Reliance Retail Smart Stores! This Navarathri has been truly auspicious, Godess Durga has showered her blessings on us. For a small local player like us, it is a big breakthrough. Result of building the brand for so many years that Reliance has chosen Cocoguru among plethora of coconut oil brands.

Cocoguru is unique coconut oil brand in coastal Karnataka

  • to have a website explaining all the details about the product and the company
  • to have a major presence in e-commerce platforms like Amazon, flipkart and Meesho
  • to be run by a team of professionals in an organized way
  • to make roasted coconut oil for cooking use
  • to focus on automation and technology in operations
  • to provide purity and quality over lower price
  • to maintain hygiene and cleanliness in workplace and thick vegetation in campus
  • to provide ESI, PF, Health and Accident insurance to employees

When we started Cocoguru coconut oil, many of our well wishers casually asked if the product is available in super market chains like More, Big Bazaar, Reliance Fresh etc. It is embarassing to say No, but got away with a few lame excuses that they ask for low price, take long time for payments. 12 years back, we explored to place our coconut oil in super markets at Bengaluru. We learnt that we were no where near to placing it there.

What it takes to get into Modern Trade
The super markets have limited shelf space to keep a variety of brands for a product. They should optimise that space by keeping only a couple of brands that is most demanded. Note that is the most demanded, not the least priced or having the best trade terms. Consumers come and pick the brands they like and less likely the brands the stores push. So a brand makes into the super market shelf, when they are most liked. And that is hard and has no short-cuts. To be liked by consumers, the product should be of good quality at affordable price, have attractive strong packaging consistently.

Challenges for local brands in large supermarket chains
The trade terms for suppliers are highly one-sided and fully in favour of the retailer. Only way for small local brands is to fully agree to it. The super markets ask for a hefty listing fees, display rent, deposit to sell products and long credit periods. This can be financially daunting to the brand.

How did Reliance take interest in Cocoguru?
Reliance opened its Smart Store at Puttur. It started with a bang because of their aggressive pricing, wide assortment and convenience. Cocoguru is a highly popular brand at Puttur and it was not available there. Everyday there used to be many enquiries for Cocoguru at Reliance. Many used to buy all grocery items from Reliance and buy coconut oil from outside wherever Cocoguru was available. The store manager repeatedly informed the centralised purchase manager. We pitched them a couple of times. But they were content with the 2 brands they were keeping. One is a national brand, but not favoured in this region, priced at a premium. Other is a local brand, priced very low, unprofessional in dealings, poor on quality, irregular in supply. So market need and gaps with existing suppliers made Reliance look at Cocoguru.

Wholesale vs Super Market
Many a times, brands go all the way to please the wholesalers to buy in bulk. But at Cocoguru, we look to please the consumers. Consumers demand for Cocoguru and retailer is left with no option but to stock our product. Our biggest buyer is not any wholesaler, but a standalone super market here at Puttur. At super market, consumers can freely pick the product they like without much influence from the retailer.

So, Cocoguru being available at Reliance Smart is a win-win situation for local consumers, brand Cocoguru and Reliance Retail. This should be the first of many more placements at bigger supermarket chains. Cocoguru should soon be available at Jiomart.com and consumers will be able to get door delivery in local area at much lower costs compared to Amazon and Flipkart.

CategoriesMarketing Pricing
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How do we set MRP?

Normally it is no big deal to set a MRP (Maximum Retail Price). All the battle is fought between competitors on the wholesale price. MRP is only a maximum, retailers can sell at any rate below it. Set it as a little high so that retailers can sell at any price they desire. It is only about printing on the package. There is no obvious consequence. Taxes are only on selling price not on MRP. But, we at Cocoguru look beyond the obvious, beyond only the retailer’s interest. That is in the interest of consumers. Retailers may sell at any price they desire, but there is a paying consumer. Manufacturer may sell to wholesaler or retailer, but brand ultimately sells to consumer. Brand must not leave too much of flexibility to retailer to dictate their price to consumer, it must be limited.

Retailer’s interest
  • Higher margins – That is the reasons retailer does business or sells a product. He looks to maximise his returns on his efforts i.e. sale.
  • Flexibility to set price – Not all consumers are same, they buy different quantities and need different levels of services. Retailers also have differing levels of sales and cost of operations. To manage this, retailer should be able to get suitable margins by selling at his desired prices.
  • Give discount to consumers – Retailers like to woo consumers through discounts but without giving up on their profit margins.
  • Pay commissions – There are many spice shops in tourist areas like Dharmastala and Subramanya. The shops rely on tourist operators to bring customers to their shop. In return the driver demands commission from the spice shop for the transaction done. The margins from the transaction should sufficiently cover this commission and still the spice shop be left with handsome margin.
  • Not be guilty – Retailer looks for additional margins without being guilty himself. If consumer complains about high price, he can always point to MRP set by manufacturer and pass the buck.

There is nothing wrong with protecting retailers interest as long as it doesn’t exploit consumers, does’t hurt the brand and his own reputation.

Consumer’s interest
  • Low price – Obviously, but the reason for stating this explicitly and in the beginning is that the brand must consider this fact while setting MRP. Lesser the MRP, lesser is the price at which consumer gets the product.
  • Discount – Consumer feels happy with the retailer when he gets the product at significant discount to MRP. Consumers should be mature enough here to look at absolute price at which he gets than the discount on MRP.
  • Consistent prices – Price range in which he gets the product should not vary too much depending on the place and shop from where he buys
Challenges to brand
  • Price fluctuation – Cost of raw materials keep changing especially when they are commodities. This results in changes in wholesale prices and MRPs. To better serve the market, every player in the supply chain needs to maintain some stock. Changes in MRPs creates confusion in the stock supplied and billing rate.
  • Variations in nature of market – Different markets have different consumption pattern and cost of retail operations and hence the cost of supply
  • Favour retailers – To a brand consumer is the end, but retailers are required to reach the consumer. If retailers are not satisfied, they will only supply to those consumers who ask for the brand and sell whatever brand he likes to others. When the brand doesn’t enjoy sufficient pull, brand can ill afford to ignore retailers.
Conclusion
  • Different MRPs – Coconut oil is used for cooking in coastal Karnataka, so per capita consumption is more. Cost of retail operations are low as the towns are of smaller size. Cost of supply is also low as they are closer to our factory. So, we have kept a lower MRP here. Price sensitivity is very high. Coconut oil is used only for hair and skin in rest of Karnataka, so per capita consumption is low. Cost of retail operations are high in big cities like Bengaluru due to high rentals. Cost of supply is high as they are far away from factory. So, we have a higher MRP there. Price sensitivity is lower.
  • Minimum mark up Cocoguru is no ordinary manufacturer, we are a brand that care for the consumers. So, we look to protect interests of consumers even at the cost of being not too favourable to retailers. So, we keep a tight MRP that is a maximum of 25% mark up to wholesale price.
CategoriesCoconut Oil Marketing
by 1

Saurav Ganguly, heart attack, endorsement of a cooking oil product

Saurav Ganguly, the price of Kolkata, former Indian test cricket captain, was responsible for building Indian cricket from the abyss of 2000 to what it is today. The post is not about cricket, but about the cooking oil he endorsed, his mild heart attack, trolling by individuals on social media.
It is unfortunate that our idol had a heart attack and as we had prayed, he has recovered quickly after Angioplasty. The moment news broke out about his heart attack, people remembered the product/brand he endorsed. The fortune brand refined rice bran oil marketed by Adani Wilmar, advertised by agency Oglivy and Mather that claims the oil to be heart healthy. Why did he get heart attack despite being a sports person at highest level and at a young age of 48?

At one level, it is unfair to target Saurav Ganguly or the brand Fortune for his present health status. Brand only claims that the oil is good for heart and never claims that no matter what you do, you will never get heart attack. Saurav on his part, despite following a healthy lifestyle had to get a heart attack. I promote coconut oil for cooking and hair but I am bald and I am not necessarily the healthiest. So, coconut oil or the brand Cocoguru is not responsible for it. But for that we need to think fairly, which doesn’t happen in the emotional world of advertising.

Should Saurav Ganguly promote the product/brand?
Saurav Ganguly has worked hard as a professional cricketer to achieve success he has and rise to be a nationally adored celebrity. He has borne the cost of being a celebrity also. It is only wise he uses his reach to commercially encash on his popularity. But people are only questioning his responsibility in choosing the products he has endorsed. I believe he must personally use it, must have done some basic research and liked it before endorsing it to others. I know Harsha Bhogle for one does the due diligence before endorsing a brand. A few cricketers like Hashim Amla don’t sport Castle Lager logo on their shirt though it is their national sponsor as it is a liquor brand. With financial commitments it is easy to endorse brands that pay the most. Sportsmen are also under the pressure to make money fast as they have limited time appeal mostly in their playing days when they are playing well.

Should the brand select Saurav Ganguly for the campaign?
The campaign is about being healthy even after crossing 40 years of age and Ganguly is a correct choice for it as he is an icon for all people across the country who are of that generation. But the brand’s advertising agency must have worked with Ganguly to find out if he really is a user of the product, does the product really promote heart health? For any long term relationship to work, deal must work fairly both ways.

Risk of having a personality endorse a brand
Nobody would have anticipated Ganguly suffering from heart attack, so the brand must be excused for not covering this risk. There have been backlashes in the past for celebrities taking political positions like Amir Khan, Deepika Padukone, Swara Bhasker etc and users have boycotted the products they have endorsed. Celebrities are humans after all and have their right to opinion and expression, but it runs the risk of their followers liking it or not. Using celebrities gives brands immediate benefits of reach and liking, but it also carries its risk.

Is there any logic, head or heart in promoting refined oils as healthy?
The low cost of refined oil gives its marketers the wide mass market for consumption and hence the marketing budget to spend enticing the users to switch to it. Refined oils may be devoid of impurities like free fatty acids, bad odour, extra colour, solid particles and moisture. But why did the oil have impurities in the first place? Because they were inferior grade oils that were made acceptable through refining. Crude, raw, filtered, cold pressed oils are extracted from superior grade oil seeds and ready of consumption as it is, without having to undergo refining. But they are expensive because such oil seeds are expensive. Crude oils are healthy but their manufacturers don’t have the marketing muscle to promote it to masses. Masses can’t afford it either. Masses usually succumb to dubious claims by advertisers especially if it comes from a celebrity.

CategoriesCoconut Oil
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Why is Cocoguru coconut oil yellow in colour?

Rotary Cold Pressed Coconut Oil
Rotary Cold Pressed Coconut Oil
Expeller Cold Pressed Coconut Oil
Expeller Cold Pressed Coconut Oil
Roasted Coconut Oil
Roasted Coconut Oil

Why is your coconut oil yellow in colour? It is not clear white, so not pure

People say this out of their experience and perception about coconut oil. They are not to be blamed because they have seen that oil from good quality copra is white and that from lower quality copra is yellow. Our coconut oil is yellow not because of poorer quality copra but because of a different process. With improvements in oil extraction technology and consumer demand for packaged coconut oil, the coconut oil colour also may undergo a change. Though clear transparent white colour looks better, for want of better quality of coconut oil, the colour may have to suffer.

Manufacturing process of clear white colour coconut oil

Copra with 7-8% moisture is crushed in a rotary machine where lower heat is generated through friction, the oil is then kept in a barrel to allow settling of sediments to take out clear white coconut oil. This is the traditional method of coconut oil extraction and at small scale still followed in villages.

The problems here are

  • Copra is high on moisture and resulting oil will get rancid fast
  • Filtering through sedimentation takes a minimum of 7 days

A superior method where above problems are solved is to dry copra to 3% moisture, extract oil from copra through expeller and filter oil online through filter press immediately.

But the resulting oil turns slightly yellow because of

1. Copra drying by application of hot air at 80 degrees

2. Higher friction and heat during oil extraction in expeller

It has better aroma and longer shelf life.

We go a step further that is the roast the copra pieces after drying but before oil extraction. This further enhances the aroma and shelf life but oil becomes more yellow in colour. There is not loss of any nutrients as it is popularly believed, it is still great for cooking. The great aroma is not because of any perfumes added but what comes out of copra through roasting. Increased shelf life is not because of any preservatives or chemicals but because of complete moisture removal from copra.

Effect of roasting can be understood by comparing the taste of ground nuts or cashew nuts before and after roasting. We eat rice, wheat and vegetables after cooking/heating not without.

There may be many traditionalists who say the contrary is true. White colour oil is better than yellow colour oil. We, respect their view and understand why they hold to their view. That is why we have cold press coconut oil also. As a brand, we believe roasted coconut oil is better.

CategoriesSales
by 0

Retailer Objection – No response

No Response Retail Store

We looked into the common objections by retailers to salesman. The toughest objection to crack is when retailer doesn’t respond. He just shakes his head and moves on. Or before you say anything, he says that he has stock and is not interested to buy. Here, we will look into how to handle this.

Objective in this situation is to not sell but to strike a conversation, build a connection, showcase the product and then see if anything can be worked out later.

“Sir, I understand that you are not interested in buying our products at this point. That is fine but I just want to showcase our products. We are doing a lot of marketing activities, our products are getting popular among consumers and there are good chances that you may get a few enquiries. The information I share with you may help you to understand your customer needs better and when you want to buy, we will be more than happy to supply to you.”

Introduce about you the salesman, name, native, past experience, when he joined the present company. Seek the shop keepers support in giving advices, references, consumer preferences etc. Share/exchange business cards.

At this point when the retailer is not under pressure to buy, and when the salesman is knowledgeable, simple and capable of understanding retailer’s concerns, he will open up. Then, products can be introduced, prices can be shared, supply mechanism, frequency can be discussed.

No matter, how disinterested the retailer will be. There is always a chance that he will face issue with present supplier in terms of quality, pricing, supply and terms. If we are able to build a relationship with him, we will be the first alternative that will come to his mind. Knowing that he has a solid alternative in us, he will start pressurising the present supplier for better deals.

A way to strike a conversation would be to keenly observe the shop. All retailers like to publicly display their say political affiliations, favourite God/Godess, owner’s car, their values, likings. One can talk about it. Each shop has its own strengths like cleanliness of the store, reputation in the locality, heritage, variety of items available, competitive pricing, size of business. Salesman can observe and appreciate the retailer and talk more about it. Also, they can discuss among their common contacts.

Eventually, probe more about the nature of business, how the retailer has grown the business, family connections, native place, his interests etc. Then, get into the demand for coconut oil in his shop. What do consumers ask for quality, price, brand etc What does he like about his present supplier, would he use it at his home?

All along the way, the salesman must be attentive, never look at his cell phone, read between the lines, be patient when the retailer is doing something else, keep eye contact, nod, stay in the topic. Never lie whenever he talks about himself, company, products, competitors, market. Keep all the information handy for ready presentation. Another point that is mentioned separately is “don’t attempt to sell”.

Before leaving, inform the retailer that the distributor or sales van would visit him for enquiring. Also, salesman would visit him say next week same day. Ask him if he needs any more information that he has to work on before coming next time.