Financial Daily from THE HINDU group of publications
Tuesday, Jul 09, 2002
Liquor cos in spirited battle against ban on surrogate ads
P. T. Jyothi Datta
NEW DELHI, July 8
FROM apple juice to water and music cassettes to Web sites, the alcoholic beverages industry should have seen the rap on the promotion of these brand extensions coming.
And with this form of advertising, viewed as an indirect promotion of liquor, likely to be barred from this month, the liquor industry is putting up a spirited battle.
Livid with the brouhaha over `surrogate advertising', the industry, both domestic and MNC segments, is fighting this battle as one. Upset with the existing ban on advertising, the proposed axe on promotions of "legitimate economic activity through trademark extensions" has made them see red.
Mr Vijay K. Rekhi, President, UB Group Spirits Division, told Business Line that the Confederation of Indian Alcoholic Beverage Companies (CIABC) had met in Mumbai to discuss developments in advertising by liquor companies.
The industry is seeking a meeting with the committee on surrogates, under the Information and Broadcasting (I&B) Ministry, besides requesting chambers of commerce and the Indian Broadcast Federation to take up cudgels for them.
"Liquor is a legitimate business and we contribute an estimated Rs 20,000-crore revenue to the exchequer. We have a self-imposed, CIABC code on advertising, benchmarked against guidelines in the US and the UK. The existing ban was unilateral and the industry, the affected party, was not part of the deliberations. And now it seeks to stop the promotion of a legitimate economic activity through brand extensions," he says.
Instead of an outright ban, liquor company representatives underline the need for dialogue and subsequent guidelines outlining dos and don'ts of advertising. "It could specify timings when the ads should be aired, not target children, disallow teenagers in ads, not allow ads that are glamorous or suggest increased attractiveness to the opposite sex after alcohol consumption."
Mr Deepak Roy, President (South Asia, Russia & Baltics), GuinessUDV (GUDV), told Business Line that the existing ban had made it virtually "impossible" to launch new products.
GUDV has Gilbey's Green Label Whisky and Gilbey's Green Label Pure Aqua, with the latter being the company's promotional vehicle. It is one of the two brands that has come in for the stick from the I&B Ministry, the other being McDowell's.
"Gilbey's water is distributed across the country, so we should be allowed to advertise," points out GUDV's Mr Roy. In his capacity as Managing Director of McDowell & Co, Mr Rekhi asserts, "McDowell's sold 1.5 million cases of water and soda, through its 20 franchise plants. Water and soda are added to our core liquor product, they are legitimate businesses."
Industry representatives are against specifying a size of business to define `surrogate'. "A surrogate is when the brand extension product does not exist and this should not be encouraged. However, there is no linkage between the size of the extended business and how serious a company is about it."
And there's more on the cards, according to Government sources. "Sponsorship of sporting events by liquor companies could be disallowed, with the Sports Ministry apparently endorsing the I&B ministry's campaign." But there's hope for liquor companies, given that they may be let off the hook if they indulge in socially relevant messages, sources add.
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