Brand Horlicks in India: an epitome or an epitaph?

Abstract

Purpose

This paper aims to focus on the insights from the brand journey of Horlicks in India and evolution of the health food drinks (HFD) category.

Design/methodology/approach

The paper explores the key reasons for the slowdown in the HFD category and the descent of brand Horlicks in India. It follows the strategic decisions and actions that Horlicks’ parent GlaxoSmithKline Consumer Healthcare took over its journey of close to 100 years. It also highlights the cardinal mistakes that it made in distribution networks, brand extensions, etc. and how these could have possibly eroded the brand equity of Horlicks.

Findings

Horlicks as a brand made many strategic errors. It frequently and needlessly fiddled with unrelated categories in contrast to its nutrition agenda. It unnecessarily spent on developing brand extensions in unhealthy categories that customers did not value or relate to. It was strategically blinded by the dominance in two geographies and continued to be under-invested in distribution networks in others. In addition, it took too long to read the writing on the wall in terms of growing consumer consciousness about the presence of sugar and fats in health foods. Even when clear signals were available of the impending slowdown the HFD category faced, despite being the market leader in the HFD segment, it showed limited urgency to foster an innovation to bolster the category.

Practical implications

Companies need to focus on a sharp business model and not try to be everything for everyone. Companies that gain valuable insight of what its customers value and design their business model to satisfy these requirements have higher chances of surviving through the weft and warp of time.

Originality/value

The paper considers the context of the highly dynamic fast-moving consumer goods (FMCG) industry in India. It is an industry where for some of the categories like HFD, the brand equity of the mother brand may or may not have a rub-off effect on brand extensions, or dominance in a particular geography may not translate to similar dominance in another geography owing to heterogeneity factor. In such a scenario, brands such as Horlicks, which do not have a consistent and coherent strategy, find it difficult to grow their market share or the category. It provides insights into the common pitfalls in brand development strategy and how it can be avoided.

Citation

Mahasuar, K. (2019), "Brand Horlicks in India: an epitome or an epitaph?", Strategic Direction, Vol. 35 No. 7, pp. 9-11. https://doi.org/10.1108/SD-08-2018-0170