Fountainhead loses Fairever, Nyle; gains Rs 20 crore worth of new business

In a move that has created quite a stir in the Chennai advertising circuit, CavinKare has parted ways with its oldest agency partner, Fountainhead. The company has pulled out its fairness cream and shampoo brand from the agency.

The Fairever brand (of fairness cream) is supposed to be worth Rs 13 crore according to market sources, while the Nyle brand (of shampoo), which has seen action in a sporadic manner is valued at Rs 3 crore. "The parting of ways has been mutually agreed upon and this ends our 10-year association with the agency. Decision on the new agency has not been taken yet," a company spokesperson told agencyfaqs!. Among the agencies vying for the business are Saatchi & Saatchi and Grey, Bangalore.

Media watchers aver that this move could be a direct fallout of the appointment of a new CEO at the company, KS Ramesh. Ramesh, who took charge in July this year, has 25 years of corporate experience in the areas of general management, sales and marketing, with almost 20 years in the FMCG sector, most of it with Procter & Gamble and Reckitt

Benckiser. It seems Ramesh has set in motion a process of streamlining the company's advertising accounts, which is currently split among JWT, O&M and Euro RSCG in Chennai.

Fountainhead, on its part, seems to have brushed aside the loss and is actively hunting for new business. "The vacuum left by CavinKare brands has been filled up with a flood of other FMCG brands in the last one month, some of which posed conflicts with CavinKare brands in the past. Most of these brands have come to the agency hoping to taste the same success as CavinKare and extend their regional domination to become pan-India players. Four new brands from Nutrine, besides Power Detergents and Power Shampoo, some new building products from Ramco Industries, Vasu Agarbattis, Aban Tea, Eastern Masalas, Sakthi Soya and Sharp Pumps have come our way. In fact, because of this rush of new businesses, the agency is shortly opening a subsidiary agency to handle conflicting brands in the same category," said Suresh Pillai, managing director, Fountainhead Communications.

Pillai indicated the new accounts will add around Rs 20 crore to the agency's billing next year. Most of these are regionally strong brands and have, in their own way, given established FMCG players a run for their money. For example, Power detergent, which belongs to Narmada Chemicals, outsells Rin in Tamil Nadu and is very strong in Andhra Pradesh. Pillai said, "We have done a commercial with actor Vijay Shanti which has given the brand (Power) a lot of attention."

Among the other new accounts, Aban tea is from the Aban Lloyd group and Eastern Masala is the leading brand in its category in Kerala. Then there is Vasu Agarbatti from the Mysore-based Vasu Group, which recently sold its foods division to the Cholayil Group. "This means we are sitting on a lot of potentially big accounts," boasts Pillai. He also indicated the company is on the verge of signing up a major fairness cream brand and a skincare range from a leading MNC player in the country, details of which will be announced shortly.

For the record, it was Fountainhead which helped CavinKare build Fairever and Nyle. According to the agency, Fairever today commands an impressive all-India marketshare of 12 per cent. Nyle shampoo, says the company, is the fifth largest shampoo brand in the country, whose success has also been scripted by Fountainhead. © 2002 agencyfaqs!