Porter's Five Forces Analysis of Dabur Real Juice

5.
Porter’s Five Forces Analysis of Dabur Real Juice
Industry Rivalry (High):
 With the increasing market for fruit juices in India (pulp and non-pulp), it is a very
attractive playing field for all the major manufacturers of fruit juices.
 Dabur is currently leading the market with a 55% market share with their product
Real and Real Activ.
 PepsiCo’s Tropicana is the leading rival of Dabur Real juice with 28% of the market
share. There is always a division between consumers who choose either Tropicana or
Real but never both.
 ITC B Naturals follows Tropicana in rivalling Real with 7.7% market share.
 Paper Boat, a comparatively new company in this sector has ramped up its campaign
strategy and more and more consumers consider them as a quick alternative to Real
Juice. Paper Boat mainly competes in the smaller packs segment and is yet to show
competition in the larger 1 litre pack segment.
 Del Monte’s Pure is the last considerable competitor with 0.7% market share.
Threat of New Entrants (Moderate):
 Dabur themselves have come up with a new product Coolers with new flavours such
as Aam Panna, a traditional flavour, which was followed by a watermelon variant
which was soon followed by a jamun flavour.
 There is also entry by Paper Boat who have a solid campaign that refers to the cultural
nostalgia of Indians with flavours like Aamras, thandai, santra, etc that trigger fond
memories of kids of today.
 Coca Cola has also entered this market with their product Minute Maid that has
considerably increased rivalry in the juice market.
 There are entries by some smaller companies with products like Onjus, B naturals,
Patanjali, Del Monte’s Pure, etc which have impacted market share of Dabur Real
Juice.
 ITC has also come up with B naturals.
Threat of Substitutes (High):
 Currently bottled water is the largest substitute for fruit juices across the segment.
Brands include Bisleri, Kinley, Aquafina, etc.
 It is followed by the carbonates which we commonly refer to as cold drinks. Coca
Cola leads in this market segment and is followed by Pepsi Co and Parle Agro Ltd.
Leading products in this segment are Coke, Pepsi, Thums Up, Sprite, Diet Coke, etc.
 They are further followed by Sports and energy drinks such as Red Bull, Monster,
Rockstar, Gatorade.
 Dabur’s Real juice can also get replaced by powdered supplements with brands such
as Tang, Rasna, Eight O’Clock, etc.
 Further substitutes can be coffee chains serving cold coffee or frappes.
 Real can also be replaced by flavoured milk drinks and the leading brand in that
category is Amul with their product Amul Kool.
 Substitutes can be further categorised into the segment that includes lassi, Badaam
milk, Buttermilk.
Market Capture (2018) Forcasted (in %)
Bottled Water (49%) Carbonates (20%) Concentrates (1%)

Juice (28%) Sports and Energy Drinks (2%)
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Bargaining Power of Buyers/Consumers (High):
 The main problem which Real juice faces is the price. It is not affordable for them to
reduce the price and consumers and buyers often do not want to spend that amount on
buying fruit juices.
 If Real increases the price of the juice, since there are so many alternatives available
to the consumers, they will reject Real juice and go for the next cheaper alternative.
 There is a strong brand loyalty in fruit juices. People opting for Tropicana or B
naturals will not get easily converted to consume Real Juice.
 Consumers often are keener in buying tetra-packs where Real juice gets beaten by
Parle’s Frooti and Coca Cola’s Maaza.
 They need to be available to the consumers in the chilled form and not at regular room
temperature for them to be further attractive.
 Indians’ consumption of per capita fruit juice per litre is considerably low.
Bargaining power of Suppliers (Low):
 Bargaining power of suppliers is low.

 The suppliers associated with Real juice is mainly of bottling equipment
manufacturers and secondary packaging suppliers.
 Since Dabur owns Real, they have got very good connection with their suppliers and
the whole distribution channel.
 If there is a pricing problem with suppliers, they can quickly change to another
supplier and must carry the weight of switching cost.
 They procure their raw materials from a variety of dealers so there is no shortage of
supply of raw materials.
 The bargaining power of suppliers is further low because they could practise
backward integration and own the packaging and bottling jobs for their own
employees.

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5.

Porter’s Five Forces Analysis of Dabur Real Juice

Industry Rivalry (High):

Threat of Substitutes (High):

Bottled Water (49%) Carbonates (20%) Concentrates (1%)

Bargaining Power of Buyers/Consumers (High):

Bargaining power of Suppliers (Low):

 Bargaining power of suppliers is low.

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