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ICMR Center for Management Research
Banning Liquor Surrogate Advertising
This case was written by Sirisha, D under the direction of Mukund, A ICMR Center for
Management Research (ICMR). It was compiled from published sources, and is intended to be
used as a basis for class discussion rather than to illustrate either effective or ineffective
handling of a management situation.
2002, ICMR Center for Management Research
ICMR, Plot # 49, Nagarjuna Hills, Hyderabad 500 082, India
Email: info@icmrindia.org.
www.icmrindia.org
2
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Banning Liquor Surrogate Advertising
“It's difficult to digest that an industry which is allowed to sell its products, is banned from
advertising the same products, despite the fact that the commercials carry health warning,
advising the customers to use the product in temperance.”
- Prof. Atul Tandan, Director, Mudra Institute of Communications, in July 2002.
BANNING LIQUOR ADVERTISEMENTS – AGAIN
In June 2002, the Information and Broadcasting (I&B) Ministry of India ordered leading television
(TV) broadcasters to ban the telecast of two surrogate ads1 of liquor brands, McDowell‟s No. 1 and
Gilbey‟s Green Label. The Ministry also put some other brands – Smirnoff Vodka, Hayward‟s
5000, Royal Challenge Whiskey and Kingfisher beer – on a „watch list.‟ The surrogates used by
these advertisements ranged from audiocassettes, CDs and perfumes to golf accessories and
mineral water.
By August 2002, the I&B Ministry had banned 12 advertisements. Leading satellite TV channels,
including Zee, Sony, STAR and Aaj Tak were issued show-cause notices asking them to explain
their reason for carrying surrogate liquor advertisements. The channels were asked to adhere
strictly to the Cable Television Regulation Act 1995 (Cable TV Act, 1995).2 As a result, Zee and
STAR stopped telecasting the advertisements; Aaj Tak and Sony soon followed suit. In addition,
the I&B Ministry hired a private monitoring agency to keep a watch on all advertisements for
violations of the Act.
These developments led to heated debates over the issue of surrogate advertising by liquor
companies. Though the liquor companies involved protested strongly against the I&B Ministry‟s
decision, they had no choice, but to comply with the regulations. Analysts remarked that the
government‟s policy was hypocritical. One said, “On the one hand they allow these „socially bad‟
products to be manufactured and sold (in order to garner revenues) and then they deny the
manufacturers the right to propagate knowledge of their products in order to drive sales. If
something is bad and cannot be advertised, why allow it to be sold at all?”
Meanwhile, the government also seemed to be in dilemma. On the one hand, it had to encourage
the sales of liquor and tobacco because they were the highest taxed sectors of the Indian economy.
On the other hand, there was also the need to take the high moral ground and reduce the
consumption of such products.
THE INDIAN LIQUOR INDUSTRY
The Indian liquor industry can be divided into two broad segments: Indian Made Foreign Liquor
(IMFL) and country-made liquor. IMFL comprises alcoholic beverages that were developed
abroad but are being made in India (whisky, rum, vodka, beer, gin and wine), while country-made
1 Advertising for other products like soda or mineral water using the brand names of liquor. 2 The Cable TV Act of 1995 outlines the various requirements that cable operators, cable networks and
programmers must adhere to.
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liquor comprises alcoholic beverages made by local breweries. While many players were present
in the IMFL segment, breweries in the unorganized sector accounted for almost 100% of the
country-made liquor segment.
During 1999-00, the Rs3 60 billion Indian liquor industry grew at the rate of 10-12%. While IMFL
was consumed by the middle and upper classes of society, country-made liquor was consumed by
the economically backward classes. In India, 40-50% of all males and 1% of all females consumed
alcohol. Almost 62% of the drinkers could be classified as light drinkers (i.e. social drinkers), 29%
percent as moderate drinkers, and about 9% as hard drinkers. The organized industry was
dominated by Shaw Wallace and United Breweries, which together accounted for around 53% of
the total market (Refer Table I, Exhibit I and Exhibit II).
Table I
Indian Liquor Industry – Player Profile
Company Leading Brands
United Breweries Kingfisher (Beer), McDowell‟s No. 1 and Bagpiper (Whiskey)
Shaw Wallace Hayward‟s, Antiquity, Royal Challenge, Director‟s Special
(Whiskey), White Mischief Vodka, Golconda, Hi-Five Beer, Lal
Toofan Beer
Jagatjit Industries Aristocrat Whiskey, Captain Henry, Bonnie Scot, Binnie‟s Fine
Radico Khaitan 8 PM Rare Blend Whiskey, Contessa XXX Rum, Whyte and
Mackay Scotch Whiskey, Contessa Premium Extra Dry Gin,
Contessa Deluxe Doctor‟s Brandy, Contessa Vodka
Source: ICMR
The liquor industry was heavily regulated by the government. Companies were not allowed to
expand capacity without prior approval from the concerned state government. The distribution of
liquor was also controlled in many states through auction system, the open-market system and the
government-controlled system. Under the auction system, the government fixed a floor price for
the shops and the bidders had to quote prices. The license was given to the highest bidder.
States following the open-market system gave companies freedom to choose their distributor and
to determine the price and the discounts. In the government-controlled system, liquor was
distributed by state agencies such as BEVCO (in Kerala) and the Andhra Pradesh Beverage
Corporation (in Andhra Pradesh). There were around 25,000-27,000 licensed retail sales outlets in
the country, in addition to the bars, pubs, hotels and restaurants serving liquor. There were
restrictions on the location of these outlets and their business hours.
Liquor producers spent heavily on advertising on the electronic media because of the reach of
satellite and cable TV. Though the broadcasters were bound by a 30-year old advertising code
which banned them from airing advertisements that related to or promoted cigarettes and tobacco
products, liquor, wines and other intoxicants, the telecast of such advertisements continued
blatantly over the years. This was because the code was only a code of conduct, not a legally
enforcing code. Doordarshan, the state-owned TV channel, was the only one that adhered to it.
The broadcasters were also bound by the Cable TV Act, 1995. However, as most of the channels
were uplinked from outside India, the Act did not apply to them. Moreover, satellite channels did
not want to follow this code because they garnered about 50% of their advertisement revenues
from liquor. In the peak seasons for the sale of liquor, this revenue almost doubled. In the first half
of 1998, STAR reported revenues of Rs 127.9 million from liquor advertisements while Zee
3 In November 2002, Rs 48 equalled 1 US $.
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reported revenues of Rs 40 million4. The regional channels managed to get about Rs 0.70 million
in revenues. Since liquor ads generated such high revenues, Doordarshan also planned to air such
ads in 2000. With a reach of 70 million homes, it expected to acquire a significant share of liquor
advertisement revenues. Doordarshan estimated that its revenues would increase three times from
cricket matches alone if it were permitted to air liquor advertisements.
Even as Doordarshan was considering the above option, the I&B Ministry barred TV channels
from telecasting liquor and cigarette advertisements in September 2000. With pressure increasing
from public interest groups to ban liquor advertisements, the government had to make amendments
to the Cable TV Act 1995 (Refer Exhibit III). While the Indian government could not take action
on most of the channels for violating the codes, as they did not uplink from India, the cable
operators were punishable under Indian law. The I&B Ministry also took steps to monitor the
advertisements broadcast by these companies.
Due to the ban, liquor companies focused more on promotions for brand building. They started
sponsoring events that projected the „glamour‟ of the brands, like track racing, car rallies etc. for
instance Shaw Wallace Co. (SWC), one of the leading liquor companies in India, conducted the
Royal Challenge Invitation Golf tournament, which became an annual event. Some companies also
promoted their products through corporate advertising, distributing free gifts like caps and T-shirts
with the brand name and using glow-signs outside the retail outlets. However, as the TV was the
most effective medium of advertising, surrogate advertising on TV became more popular.
ABOUT SURROGATE BRANDS
Even after the ban, liquor companies continued to advertise their drinks in the form of surrogate
advertisements. In this type of advertisement, a product other than the banned one is promoted
using an already established brand name. Such advertisements or sponsorships help in brand
building and contribute to brand recall. The product shown in the advertisement is called the
„surrogate.‟ The surrogate could either resemble the original product or could be a different
product altogether, but using the established brand of the original product. The sponsoring of
sports/cultural/leisure events and activities using a liquor brand name also falls in the category of
surrogate advertising.
In late 2000, a group of broadcasters, who were members of the Indian Broadcasting Foundation
(IBF),5 submitted their recommendations on surrogate advertising to the I&B Ministry. Under the
recommendation, surrogate advertising would comprise „the products of the liquor companies,
which do not have a minimum turnover of Rs 10 million and where the products are not
manufactured in bulk quantity.‟ The broadcasters also urged the government to allow them to
telecast socially responsible advertisements sponsored by liquor companies. They requested
permission to telecast such advertisements because the Indian television industry‟s revenues had
reportedly decreased by about 7-11% (about Rs 1 billion per annum) after liquor and tobacco ads
were banned.
After more than six months, in mid-2001, the I&B ministry accepted the recommendations of the
broadcasters. However, this decision was not formally announced because there was same dispute
over the issue of hoardings of these ads at sports events being broadcast on television. The I&B
Minister Sushma Swaraj said, “We have sought the sports ministry‟s comments on the issue and
are awaiting their response before announcing the norms. If a company makes a product other than
4 Zee could air liquor ads only after 9.30 pm as it was aired in the Middle East also. 5 The IBF is a non-profit national organization of television broadcasters, airtime sellers and other entities
in the field of television broadcasting, set up to promote the television industry. It has about 27 members
including Sony, Zee, Star, Sahara, Discovery, MTV etc. In October 2001, the IBF also included radio
companies as its members.
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liquor (or tobacco), which has a turnover of Rs 1 crore (Rs 10 million), then the firm is entitled to
use the same brand for that product.” She announced that a formal decision would be made after
the sports ministry‟s comments were received.
In the mean time, some liquor producers entered new segments under the liquor brand or
advertised these products under the liquor brand. Most of liquor producers entered into the
packaged water segment, such as Kingfisher Mineral water. Some companies seemed to be using
the ban to their advantage. McDowell‟s mineral water and soda brands served as surrogates for
their liquor brand and also generated additional revenues for the company. To expand this
segment, the company franchised its bottling and sale of purified drinking water and soda and
made them available in more than 75 cities in the country.
In early 2001, SWC started marketing its range of golf accessories under the liquor brand Royal
Challenge. It also launched a new range of golf accessories, including graphite shafted golf sets
(with lifetime warranty), golf bags, caps, and gloves. SWC also started a quarterly golf publication
that which provided information on the latest happenings on golf. The company also entered into
agreements with the Indian Golf Union and the International Management Group to promote the
game in India. It also announced that India‟s flagship Golfing Event – the Indian Open – would be
sponsored by the company till 2006.
In late 2001, SWC announced its decision to enter the packaged water market, under its well-
known beer brands Hi-Five and Lal Toofan. In 2002, it named it soda water Royal Challenge
Premium Sparkling Water6 to leverage the company‟s flagship liquor brand Royal Challenge.
According to industry watchers, SWC was launching Sparkling Water to use it as a surrogate for
its liquor brand. They were of the view that, following the ban on advertising, liquor companies
were forced to look at innovative ways of building their brands.
The number and range of surrogate advertisements increased as liquor producers started
sponsoring movies, music shows, and other programs attracting youth. For instance, Seagram‟s
Royal Stag was promoted by sponsoring movie-related activities and Indian pop music under the
banners Royal Stag Mega Movies and Royal Stag Mega Music. It promoted its 100 Pipers brand
by sponsoring a series of performances by fusion music artists under the name 100 Pipers Pure
Music. Blenders‟ Pride sponsored a series of performances by troop dancers and artists under the
banner of Blenders‟ Pride Magical Nites. Seagram also sponsored events such as the Chivas Regal
Polo Championships and the Chivas Regal Invitational Golf Challenge for corporates.
In late 2001, television broadcasters began airing socially responsible advertisements sponsored by
liquor companies, even though the government had not issued any notification permitting the
airing of socially responsible ads on TV. Star TV and Sony were among the leading broadcasters
telecasting such advertisements included STAR TV and Sony. The advertisements were telecast
during Christmas and New Year‟s Eve. One of these ads by Seagram wished the viewers with
„Season‟s Greetings.‟ Another advertisement of Seagram read, “Tonight, when it‟s one for the
road, it‟s got to be coffee.” L.S.Nayak, Vice President (Sales and Marketing), STAR TV said, “It‟s
not a liquor advertisement at all. It‟s just another corporate advertisement through a social
message. It cannot be classified as a liquor advertisement because Seagram is not a liquor brand.
One must see the spirit behind an advertisement to find out whether it‟s promoting liquor or not.”
Some of the broadcasters said that because the I&B Ministry was taking a long time deciding
about the use of socially responsible advertisements by liquor companies, they had started using
them without the Ministry‟s consent. IBF‟s Executive Director, Bhuvan Lal, reportedly argued that
there was nothing wrong with airing such advertisements because they did not violate the
government‟s guidelines restricting the telecast of direct/indirect liquor ads. The government‟s
6 Sparkling water is a milder form of soda.
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guidelines stated that „advertisements which lead to sale, consumption and promotion of liquor
should not be allowed.‟ According to Bhuvan Lal, these advertisements were perfectly legal as
they did not lead to sale, consumption and promotion of liquor.
Soon, liquor companies that had not entered into any agreements with satellite channels for
airing socially responsible and surrogate advertisements started processing such agreements.
For instance, Whyte & Mackay began negotiating agreements with various TV channels,
including Star TV. Amar Sinha, CEO, Whyte & Mackay, said, “As long as there was no ban,
companies were not interested in showing liquor advertisements in the garb of social
messages. But with the government imposing restrictions, social messages are a route to liquor
advertising for many.”
By early 2002, there were many surrogate advertisements of liquor brands on satellite TV
channels. These advertisements attracted a lot of criticism. According to an analyst,7 “We see a
brown liquid poured into a glass under a well-known brand name, and we are told the man is
drinking apple juice! The girl who is avidly watching him immediately rewards him with a kiss. In
the same sort of way, water, soda and other harmless liquors stand in for hard liquor and beat the
ban.” (Refer Exhibit IV and V for sample surrogate advertisements). There were numerous other
advertisements selling music cassettes, CDs, water, clothing, fashion accessories and sports goods
– many of them accused of being sexually provocative and offensive.
The I&B Ministry‟s decision to ban such advertisements was thus viewed as a logical and
necessary step by their critics. As the authorities were finding it difficult to track down the
increasing number of violations, especially at the regional level, the Ministry hired a private
monitoring agency. The agency – Time Monitoring (Delhi-based) – was responsible for scanning
all advertisements on all private satellite channels including regional channels. At the same time,
the Confederation of Indian Alcoholic Beverage Companies (CIABC), in a self-disciplinary move,
asked all TV channels to stop telecasting surrogate liquor advertisements.
THE DEBATE
The banning of surrogate advertisements for liquor brands became a very controversial and
sensitive issue. Liquor producers felt that while the government allowed them to do business, it did
not allow them to do so in a profitable manner. Liquor companies argued that the ban would
severely affect the sales. They said that TV was the most effective medium of advertising for these
products and thus the restriction would hamper brand building.
However, some analysts were of the opinion that the ban could turn out to be advantageous for
domestic players. According to a WTO agreement signed in March 2001, MNCs had unrestricted
license to sell their products. After the ban, these MNCs would not have access to the quickest and
most effective form of advertising – the TV. Thus MNCs who had recently entered the Indian
industry were expected to face difficulties in building their brands. The ban would also affect the
entry decisions of MNCs that were planning to enter the Indian liquor industry.
Moreover, some analysts argued that the ban would not affect the established domestic players
severely. It would only affect new launches and new brand building activities of these companies.
Players who already had very strong brands (E.g. McDowell No. 1, KingFisher, Hayward‟s and
Royal Challenge) would not be affected by the ban. Apart from reducing foreign competition, the
ban was also expected to improve margins for these players, as these companies had already spent
heavily on advertising and other promotional activities. (Refer Table II).
7 Amita Mallik, www.tribuneindia.com
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Table II
AD Spends of Leading Indian Liquor Companies
Company Year
Ending
Ad expenses
(in Rs million)
As % age
of Sales
McDowell 03/00 1,089.0 13%
United Breweries 03/00 737.0 28%
Shaw Wallace 06/99 565.0 7%
Radico Khaitan 12/99 78.1 8%
Jagatjit Industries 03/99 523.0 13%
Source: www.indiainfoline.com
On an average, liquor companies spent about 10-12% of sales revenue on advertising, including direct consumer promotions programs; sponsorships; and print and electronic media advertisements. On TV alone, companies reportedly spent about 3-4% of sales revenue. This meant that after the ban, companies could save 3-4% sales or gain in margins. For instance, McDowell‟s operating margins ranged between 5-7% and after the ban, were expected to increase by 50%. The smaller companies in the domestic market also seemed to have an advantage. Industry watchers felt that since distribution and reach would become more vital after the ban, smaller companies might be acquired by the larger ones for their distribution network, if not for their brands.
The restrictions on the liquor industry were viewed by many critics as attempts by the government to disassociate itself from the social evils associated with alcohol consumption. However, some critics observed that while the government imposed many restrictions on the liquor company; it also earned a significant portion of its revenues (Rs 200 billion in 2000 for the whole country) through levies on liquor sales.
The issue of surrogate advertising involved even media companies, as they had to forego substantial revenues as a result of the ban. According to broadcasters, the government should put in place a „reasonable‟ policy, which somehow struck a balance between the social and monetary aspects of the business of alcohol.
WHAT LIES AHEAD?
In August 2002, broadcasting industry sources revealed plans to put in place measures for self-regulation and monitoring, even before the I&B Ministry took concrete steps in this regard. The broadcasters who were members of the IBF, announced that they would come up with an advertising code specific to surrogate advertising. IBF set up a sub-committee that included among others, with L. S. Nayak (Executive Vice President, Star TV), G Krishnan (CEO, TV Today) and Manu Sawhaney (MD, ESPN-Star Sports). Apart from formulating the advertising code, the committee would monitor the advertisements that appeared on the TV channels. Bhuvan Lal said, “We would like to clear any such advertisement with the committee and nip any offending advertisements at the drawing table.”
Around the same time, apart from the 12 ads banned earlier, the I&B Ministry was in the process of issuing show-cause notices to AXN and Zee for two advertisements promoting Aristocrat Apple Juice and Whytehall. The controversy surrounding surrogate advertising was undoubtedly the result of the government‟s and liquor industry‟s age-old tussle of revenues versus morality. Ashoke Bijapurkar, President, B-MRP Communications8 said, “This brings us to the question being debated: should surrogate advertisements be banned? I feel the real question to be asked is: should liquor and tobacco advertising be banned?”
8 BRP is a high-end public relations company with expertise in reputation and perception management.
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Following the ban, most liquor companies again explored alternative promotional activities.
Industry watchers remarked that the ban would affect the channels more than the liquor companies
themselves. The companies might actively resort to sponsorships of sports events, dance and music
programs, and other fun-filled activities. Some of the major domestic companies were considering
the use of the Internet as an effective marketing medium.
QUESTIONS FOR DISCUSSION:
1. „By banning advertisements for liquor, the government is trying to disassociate itself from the
social evils associated with alcohol consumption.‟ Critically comment on this statement in
light of the ban on direct and surrogate advertisements for liquor.
2. Do you think surrogate advertisements by liquor companies were banned because of the
criticism they received? Give reasons to support your answer. Also, discuss the advantages and
disadvantages of using surrogate advertisements (for a liquor company in particular and also
for any other type of company).
3. As a part of a team responsible for the marketing of a leading liquor brand, what measures
would you suggest to overcome the limitations imposed due to the ban on surrogate
advertising? Does the use of „socially responsible‟ advertisements go against the interests of a
liquor company? Analyze.
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Exhibit I
Sales of Wines, Spirits and Liquor Companies
(in Rs million)
Company 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01
McDowell & Co. - - - - - 7766.1
Balaji Distilleries 3383.3 3658.0 4248.7 5273.0 5491.0 5419.4
Shaw Wallace & Co. 4101.0 4020.1 3493.1 4320.9 4989.1 5059.1
Mohan Breweries & Distilleries 1474.0 1714.1 2489.1 2596.6 3089.2 3800.5
Balaji Industrial Corpn. - - 3050.6 3451.8 3773.4 3691.8
Pearl Distillery - - 555.9 1744.3 2323.1 2323.1
Herbertsons 1770.3 1323.0 1490.8 1867.3 2013.4 2066.1
South India Corpn. (Agencies) - - - 1291.6 1549.5 1894.3
Maharashtra Distilleries 1636.9 1445.5 2050.3 1822.3 1681.9 1680.9
Mohan Meakin 1037.7 1112.1 1399.9 1472.6 1465.0 1446.6
Chandigarh Distillers & Bottlers - - - 1224.9 1139.3 1396.8
Seagram Manufacturing - - - 1077.4 1077.4 1374.2
G M Breweries 1036.8 999.1 999.1 994.8 1037.7 1280.2
Radico Khaitan 498.3 489.8 709.7 828.6 1186.5 1240.2
Khoday India 1104.3 866.2 876.8 1053.3 1108.1 1165.8
Rajasthan State G. Sugar Mills 677.7 549.4 549.4 - 1255.2 1082.7
Central Distillery & Breweries 25.5 195.7 549.6 1225.2 1144.3 1038.9
BDA 713.1 - 1084.0 971.0 990.6 990.6
U D V India - 676.0 565.5 565.5 745.1 823.0
I F B Agro Inds. 603.3 707.9 719.1 834.2 782.7 781.9
Source: CMIE
Marketshares of Wines, Spirits & Liquor Companies
(in %)
Company 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01
McDowell & Co. - - - - - 12.05
Balaji Distilleries 9.65 11.10 9.16 8.52 8.09 8.41
Shaw Wallace & Co. 11.70 12.20 7.53 6.98 7.35 7.85
Mohan Breweries & Distilleries 4.21 5.20 5.37 4.20 4.55 5.90
Balaji Industrial Corpn. - - 6.58 5.58 5.56 5.73
Pearl Distillery - - 1.20 2.82 3.42 3.60
Herbertsons 5.05 4.01 3.21 3.02 2.97 3.21
South India Corpn. (Agencies) - - - 2.09 2.28 2.94
Maharashtra Distilleries 4.67 4.39 4.42 2.94 2.48 2.61
Mohan Meakin 2.96 3.38 3.02 2.38 2.16 2.24
Source: CMIE
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Exhibit II
Sales of Beer Companies
(in Rs million)
Company 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01
United Breweries 1761.6 1833.4 3035.9 2840.3 2632.2 4315.8
Mohan Breweries & Distilleries 934.2 892.9 851.5 899.3 824.7 912.4
Balaji Hotels & Enterprises - 342.1 690.2 588.9 331.5 708.9
Mohan Meakin 406.8 426.8 421.3 568.0 551.5 674.0
Skol Breweries 433.9 501.2 699.5 753.4 669.5 598.5
Mysore Breweries 394.3 393.1 408.4 561.2 532.1 532.1
Lilasons Industries - - - - 501.4 493.9
Charminar Breweries (Erst.) 9.0 189.4 395.5 423.8 454.1
Foster‟s India - - 1.6 1.6 345.8 432.7
Mount Shivalik Breweries 294.1 293.2 293.2 387.8 405.9 388.1
Aurangabad Breweries 223.3 327.7 387.5 364.0 364.0
Mount Shivalik Inds. 65.0 65.0 225.1 328.5 276.0 355.6
Artos Breweries - - - 276.5 219.5 352.1
Sica Breweries (Erst) 169.4 253.9 304.8 312.1 332.9 332.9
Central Distillery & Breweries 52.7 105.1 141.5 - 254.0 314.2
Shaw Wallace & Co. - - - 69.5 292.5 288.1
Som Distilleries & Breweries 123.5 169.6 244.1 274.1 282.4 282.4
Mohan Rocky Springwater Breweries 191.0 191.0 - 190.0 123.6 250.3
East Coast Breweries & Distilleries - 91.0 124.2 210.4 146.1 247.7
Hindustan Breweries & Distilleries 326.0 289.5 380.8 343.3 232.2 241.8
Source: CMIE
Marketshares of Beer Companies
(in %)
Company 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01
United Breweries 25.38 24.21 32.16 23.92 21.35 28.84
Mohan Breweries & Distilleries 13.46 11.79 9.02 7.57 6.69 6.10
Balaji Hotels & Enterprises 4.52 7.31 4.96 2.69 4.74
Mohan Meakin 5.86 5.64 4.46 4.78 4.47 4.50
Skol Breweries 6.25 6.62 7.41 6.34 5.43 4.00
Mysore Breweries 5.68 5.19 5.09 4.73 4.32 3.56
Lilasons Industries 4.07 3.30
Charminar Breweries (Erst.) 0.13 2.01 3.33 3.44 3.03
Foster‟S India 0.02 0.01 2.81 2.89
Mount Shivalik Breweries 4.24 3.87 3.11 3.27 3.29 2.59
Source: CMIE
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Exhibit III
Cable TV Act 1995: 2000 Amendments Related to Liquor Ads
The Cable TV Networks (Regulation) Amendment Bill 2000 came into effect on 8th September
2000. The Union Minister of Information & Broadcasting, Mr. Arun Jaitley, made this
announcement.
Liquor and Tobacco Ads:
Liquor & Tobacco advertisements are now banned on all channels transmitted or retransmitted
in India. Earlier, only channels uplinked from India had to adhere to this code. As a result,
Doordarshan and a handful of other channels that uplinked from India through VSNL were
prohibited from accepting Liquor & Tobacco ads. Earlier, these constraints did not apply to
leading channels such as Zee TV, Sony TV and STAR because they uplinked from outside the
country, even though their primary target audience was in India. Some of these channels
received up to 30% of their ad revenues from Liquor & Tobacco advertisements. The
government now seeks to provide a level playing field for all channels, including Doordarshan.
Surrogate Advertisements:
In the past, liquor advertisers have often resorted to surrogate advertisements where the brand
name of a product normally associated with Liquor is advertised as another product e.g.
Kingfisher Mineral Water or a soda that is named after a whisky. Surrogate advertisements can
also indirectly advertise or promote a product without actually displaying the product. The I&B
ministry has taken a serious view of this and the new amendment prohibits all advertising that
„directly or indirectly‟ promotes the production, sale or consumption of tobacco, cigarettes and
alcohol.
Source: www.scatmag.com
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Exhibit IV
Surrogate Television Advertisements - I
(Apple Juice Using the Aristocrat Brand)
A young man gets a much-awaited
call in his office. Whatever the caller
had to say, gives him a reason
to celebrate.
At the party thrown in the honor
of his success that night, he spots
his attractive colleague in the
crowd. Sipping his drink...
...he strolls towards her. Their eyes
lock and they inch closer. This is followed by
the line....
...Whatever the occasion. Always
ACP (Aristocrat Premium
Apple Juice.)
Source: www.agencyfaqs.com
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Exhibit V
Surrogate Television Advertisements – II
(Mineral Water Using the Green Label Brand)
Shot of engineers
busy at a new railway
site.
An anxious villager
asks, „The train won‟t
reach our village?‟
Looking at the terrain
the chief reluctantly
says it‟s not possible.
A young engineer is
optimistic that the
tracks can be laid by
drilling...
...through a cave.
This is followed by
the brand‟s jingle in
Hindi. His idea gets
approved and
applauded as...
...it works the way he
planned. The jingle
continues as the men
take a break from
their hard work.
Finally the much
awaited train
arrives at the village.
The proud chief
asks his youngman,
„What‟s the program
for the evening?‟
He is pleased to say,
„My label is Green
label.‟ The
advertisement then
states, „New Gilbey‟s
Green Label. Rich
and smooth.‟
The villagers carry
their hero on their
shoulders and dance
in joy. The jingle
continues.
Source: www.agencyfaqs.com
502-076-1
14
Additional Readings & References:
1. Anuradha Raman, DD's Still High On Liquor Ad Revenue, Indian Express, September 30, 2000.
2. Ban on Liquor Ads: Boon or Doom?, www.indiainfoline.com, October 6, 2000.
3. Nivedita Mookerji, TV Channels Feel the Pinch of Loss of Liquor Ad Revenues,
Financial Express, December 27, 2000.
4. Mookerji Nivedita, Liquor Companies Resort to ‘Socially-Responsible’ Ads, Financial
Express, January 6, 2001.
5. Raman Anuradha, I&B Sleuths are Monitoring Surrogate Ads for Objectionable
Matter, Indian Express, January 7, 2001.
6. Raksha Hegde & Reeba Zachariah, Controlled Liquor Ads Could Hit Channels,
Companies, www.rediff.com, May 2001.
7. Bhaskaran K Kavita, Liquor Majors Rework Marketing, Brand Promotion Strategies,
www.expressindia.com, October 5, 2001.
8. Mookerji Nivedita and Gombar Vandana, Surrogate Ad Game: The Ball Is Now In Sports
Ministry’s Court, Financial Express, October 25, 2001.
9. Govt Tames Advertising’s Crude Dudes, Financial Express, June 20, 2002.
10. Clamp-down on Surrogate Ads Likely, Economic Times, July 4, 2002.
11. Should Surrogate Advertisements Be Banned?, Economic Times, July 23, 2002.
12. Kaushik Neha and Subramanian Nithya, Liquor Cos Ask Channels to Take Off Surrogate
Ads, The Hindu Business Line, August 9, 2002.
13. Govt Puts the Lid on Surrogate Ads, Economic Times, August 10, 2002.
14. Dey Sudipto, Surrogate Ads: Broadcasters for Self Regulation, Economic Times,
August 13, 2002.
15. www.scatmag.com