Innovation the Survival Mantra
The core Indian art material market of around Rs 500 crore is said to be growing at a rate of
Indian art material Industry is a vast scattered market
consisting of different variety of attractive products
like different types of brushes like synthetic brushes,
painting brushes, artist brushes, Oil pastels, crayons
of different types, painting accessories, poster colours,
fabric colours, liquid water colours, colour pencils,
drawing books, colouring books, easel boards, canvases,
palettes, markers, paints, coloured chalk and many more.
The industry is said to capture maximum business from
the consumer market directly, which accounts to 70%
of their revenue.
The core Indian art material market of around Rs 500
crore is said to be growing at a rate of
4 - 5 % but there is intense competition in this industry
as the industry is highly unorganized which proves to
be a downfall for this sector. With the duty rates coming
down the art material imports have risen sharply in
the last couple of years and several Chinese and Korean
brands are available in the market. International majors
like Faber Castell etc have also ventured into the market.
Maximum competition has come in the school colour range
where the Indian manufacturers like Camlin Limited who
has been in this venture for years, Pidilite Industries
who has launched a new range of art materials for children
(crayons, water and tube colors, etc) under it's Acron
brand and others had to reduce prices to fight competition.
There was almost
15-20% reduction seen in prices since the last 5 years.
The Indian manufacturers have to face a tough time in
the market. The threat of new entry affects the firms
already existing in an industry and if a new rival can
easily get in, then the market becomes more competitive,
hence the firms must put some barriers to stop others
from entering. Now the Indian firms also have the burden
of VAT, which is levied by the Indian government at
a flat rate of 4%. The only tools in their hands are
manufacturing new, innovative and attractive products
in the market that compel the consumers to buy their
products. Also branded goods have a hold on top of unbranded
goods, as now people prefer to buy branded products
expecting satisfaction of a good quality product. But
in a developing country like India still this phenomenon
is not put much into practice, the middle and lower
class still prefer to buy the cheap imported goods as
their low price factor is indeed a tempting offer. But
with proper awareness and guidance the Indian consumer's
opinion can be reversed. The existing leaders should
create a brand identification, the new entrants thus
will have to try and take satisfied brand loyal customers
away from the leaders which makes it a difficult task
for them to conquer.
Also new marketing activities like new products being
introduced to serve different market segments are being
implemented to strengthen the brands. In the children's
product sector too many brand ambassador products are
seem to be working well. For e.g., it is seen that children
prefer to buy products with cartoon character's photographs
or gifts attached as compared to others. In 2005 too
such products sale show an uptrend curve rather than
the normal art material products.
Today the market has expanded and it's not a child's
play anymore. The threat of substitute products also
comes into concern. If substitute products are readily
available, then the firms are likely to suffer. The
power of buyers should also be taken as a considering
factor. The industry keeping in mind the innovation
key in their hands can compete with the unorganized
sector and imported goods sector that prevail in the
market. Though many are of the opinion that through
brand building initiatives, good quality and innovation
mantra they have managed to survive in the industry
in 2005 and plan to do the same in 2006.
