Innovation key to establishing a brand
Innovation and new ideas are key to establishing a brand and ensuring its sustainable run, said Syed Alamgir, managing director of ACI Consumer Brands.
“Innovation will have to be in a positive manner and must differentiate a product from its competitors. What is more, a product must cater to consumers’ taste,” he said in an interview with The Daily Star at his office in Dhaka last week.
Alamgir is a well-known face in the country’s consumer brands’ segment, thanks to his long career that spans more than four decades and his acumen in introducing products that shook up the markets.
If people in Bangladesh could afford a product worth Tk 5,000, they would also go on to try to buy a product that will cost Tk 6,000, he said.
“It is a good sign. It is good for the economy and the entrepreneurs,” he said, adding that this is much contrast to the neighbouring countries where people are keen to save more.
He joined ACI in 1998, which is one of the fast-growing fast-moving consumer goods companies in Bangladesh. He has initiated many brands in the company.
Of them, the “Pure” brand launched in 2005 was awarded seven times by Bangladesh Brand Forum as one of the best brands in the country.
ACI Consumer Brands has a line of toiletry products, in the sub-categories of soap, hand wash, antiseptic liquid and cream, hand sanitizer and wipes.
Savlon and Aerosol are the top two brands of the company where Savlon occupies 83 percent of the market in antiseptic category and Aerosol 94.6 percent in the insect killer category.
According to Alamgir, the country’s huge and dense population of around 16.3 crore makes marketing easier.
“However, the problem is the wallet size of the people is not as big as their soul.”
Many people are still poor, while there are many who belong to the lower-income group and they cannot afford consumer goods, according to Alamgir.
Speaking about innovation, he said it is a challenge for entrepreneurs that they cannot spend much on innovation and product design as it fuels the cost of production and thus the final price of products.
In the end, these products may not remain affordable to many, he said.
Another challenge is that the consumers’ adaptability to changes is slow in case of accepting a new product and design. However, the tendency has changed in the last few years as people are increasingly travelling abroad, getting to know new products.
About the Bangladesh Standards and Testing Institution’s (BSTI) recent ban on ACI Salt, Alamgir said the pH value is not accepted as a parameter for salt in any countries other than Pakistan and Uganda.
“This can’t be a parameter. Another thing is it is an evaporating ingredient and its reading will not be the same at every stage.”
The value of pH, which stands for ‘potential of Hydrogen’, is a measure of acidity of water soluble substances.
According to Alamgir, when the BSTI collected the first sample from a faraway place in Chattogram, it found the pH value slightly different from the regulatory level. After ACI’s plea, it reviewed and re-examined and found the level okay.
“We were not worried about it [the ban] because we knew what the truth is and consumers will also realise the truth,” said Alamgir, also the managing director of ACI Salt.
ACI Group’s profit slumped in recent months and this is because the company has invested in many new projects, which would take time to make profit, he said.
“The investments and the projects will give a positive outcome to the conglomerate.”
Alamgir, who graduated from the Institute of Business Administration under Dhaka University, shot to fame when he pioneered the idea of halal soap in Bangladesh in the 1990s as the marketing director of Jamuna Group of Companies.
Recently, the idea has cited in the 13th edition of “Principle of Marketing—A South Asian Perspective” of Philip Kotler, who is known as the father of modern marketing.
Alamgir recalled the story behind the halal soap idea. His research found out that soap is made of rice bran oil, vegetable fat and animal fat.
As animal fat has its own scent, any additional perfume added does not match well and give any better aroma. Rice bran oil cannot create as much foam as consumers want.
On the other hand, vegetable fat blends with the perfume smoothly but the production is costlier.
Alamgir went for the vegetable fat as he had thought that the price will not matter if the soap can match the taste of consumers.
He also went to London and saw himself the processing of halal meat there, further strengthening his case for a halal soap in Bangladesh.
“This is how the halal soap idea came about and boomed. The popularity of the soap spread like a fire and removed the top-ranking soap within a very short period of time.”
Jamuna Group also had to import new machinery immediately to cope up with the rising demand for the soap.
Unfortunately, Jamuna’s halal soap factory was shut due to a lack of innovation.
“The market is a dynamic thing and for a brand or a company to succeed and sustain, it needs modification time to time because without modification and innovation a good product can be obsolete.”
At Jamuna Group, he also built the Pegasus Shoes brand and it rose to the second position in the market within two years of launch.
Before rolling out a mosquito coil for ACI, he visited slums to the houses of the rich to get to know about consumers’ behaviour with a view to coming up a product that will be consumer-friendly.
Alamgir won a number of accolades in his long, illustrious career, with the latest one coming in the form of a “Marketing Superstar of Bangladesh” award given by Bangladesh Brand Forum.
Alamgir is bullish about the business potential in Bangladesh. He said the country has huge potential to grow entrepreneurship as there are not many strong brands.
“It is easy to build a brand and run business well.”
He also spoke about challenges: the ease of doing business is not at the expected level because it feels that many government agencies are just waiting to create problems for entrepreneurs.
In the same time, budgets also create uncertainties among entrepreneurs through policy changes.
“What is more, lower level of infrastructural development drives the cost of production despite the country’s huge strides in infrastructure development in recent years.”
