The Perini Journal has gone to Mexico City, to Copamex - Consorcio Papelero Mexican owner of such established brand names as Regio, Lovly, Tessy and Flen, who in September of 2002 launched Lady Regio on the market, the first toilet roll dedicated exclusively to women.
At their general headquarters, Juan Manuel Rojas Vela, responsible for Marketing, and Rodolfo Velazquez, head of the Tissue Products Research and Development department, welcomed us.
Maura Leonardi
On supermarket shelves, white, soft, embossed, printed but simple toilet rolls abound. They lead the tissue products category in terms of worldwide consumption with 12,000,000 tons consumed in 2001. A consumer item retained by all as a commodity.
There's nothing more to be said about toilet rolls. Well, Copamex, one of the main tissue producers of Mexico, certainly has more to say. And just to prove it, last September, the company launched on the Mexican market Lady Regio, a toilet roll dedicated exclusively to women. A veritable personalization of the traditional toilet roll where softness and strength are the key words used to describe "el primer papel creado por la mujer". Lady Regio is a two-ply product: the first, upper ply is a soft peach colour while the second, lower ply is white, resistant and lightly fragranced.
Sold in packages of 4 and 12 rolls, Lady has taken the market by storm: just two months after its official launch, the product has already conquered a strong 4% of women. Sold in the main Mexican retail stores not as a mere toilet roll but rather as an actual product for feminine hygiene, backed by an entertaining publicity campaign comprised of television commercials and advertisements in women's magazines, the product seems to be set out to conquer even the most sceptical of women. "Understanding the needs of consumers and in particular, those of women, was our challenge. In these last few years, the Mexican market has witnessed important changes. For our company, innovation represents the principal instrument that allows us to constantly grow, creating quality products that meet the needs of consumers and, in this case, of women, "said Rodolfo Velazquez, head of the Tissue Division's R&D Department.
PJL: After many years' experience in the industrial field, for the last ten years you have also been present on the consumer products market. What is your marketing strategy?
Juan Manuel Rojas Vela: To offer different products through constant research, identifying what consumers want. This is what we market. In 1992, we created our Consumer Division for the commercialization of tissue products. In the past five years, we have grown, developing new consumer divisions in strategic areas such as baby diapers, feminine hygiene products, incontinence products and AFH products for domestic and industrial use. Today, the Consumer Products Division represents more than 50% of the total revenue of the group and in just ten years we've conquered 30% of the market. This is the result obtained through a strategy focussed on developing a line of products for all market segments - high, medium and low - for toilet rolls, napkins, facial tissue and kitchen towels. Through an appropriate segmentation and identification of our reference targets, we have tried to summarize the key market characteristics for every product. For kitchen towels, we've focused on Boreal as our high quality product, and Tessy for the medium/low segment. Scottis for facial tissue, and for toilet rolls and napkins, we're present with Regio, Lady Regio, Lovly, Tessy, and Flen. Regio and Lady Regio are synonymous of high quality; Lovly covers the medium segment of the market, while Tessy and Flen represent the "lowest price" segment. This makes for a product mix able to satisfy the different demands of Mexican consumers and to keep abreast of market trends.
Quality, innovation and differentiation are the main ingredients of our marketing strategy. Innovation and technology updating are constant features for Copamex that allows us to maintain our products in a leadership position in a market where the strong presence of American companies has determined a change in the very structure of consumption trends, favouring the penetration of premium quality products.
PJL: Lady Regio represents a veritable product innovation, a new concept for the simple toilet roll. How was the idea born?
Juan Manuel Rojas Vela: The leitmotif that guided the project, which started at the beginning of 2002, was a synergy of two concepts: differentiation and added value and niche segmentation. The need to differentiate itself from other products was imposed by the Mexican market - a market that has in these past few years witnessed important changes in terms of consumption. Two years ago, the other two important tissue producers present in Mexico, Procter & Gamble and Kimberly-Clark, began to substantially invest in TAD technology, putting softer, bulkier and more absorbent toilet rolls and kitchen towels on the market. And this is how the change began. P&G's introduction of Charmin in October 2000 changed the dynamics: tissue products were traditionally considered generic products and consumers were segmented according to a social-economic criterion and price was the determining factor. On supermarket shelves, products for domestic use were considered just simple rolls and the brand names presented in every segment were perceived as being all the same. More aggressive promotional and communication campaigns and captivating packaging have become veritable arms used in conquering consumers' attention and preference. Generic tissue products started to take shape and each brand began to develop its own personality. For this reason, in a market where competition is very strong, it is important to offer innovative products and to focus on obtaining consumer loyalty. In this context, our adventure began. We wanted to be different from the others both in terms of product as well as technology. For the product, we wanted to point towards a new category, different from the "children" cluster that everyone else was concentrating on. For technology, we followed a different road and focussed on innovation both at the papermaking and at the converting phase. The Monterrey facilities - where the Lady brand product is manufactured - features a Voith TissueFlex crescent former PM producing 110 tons per day of tissue in a 3.5-m format. This machine, together with the use of 100% virgin fibres, has allowed us to obtain a qualitatively better product having greater absorbency and softness. On the converting side, at the basis of the entire process is the Perini technology with a Sincro 6.5 line (in a 3.6-m format) and the flexibility of the deco-embossing system. The simplicity of installation and the flexibility of this system have been instrumental for this new product. Embossing and gluing of the two plies confer an elegant decoration to the product, and the possibility of using two similar embossing patterns on two rolls avoids creating wrinkles on the web. The replacement of the steel roll is carried out in a very short time, so the entire line results more flexible. The packaging section downstream of the line is supplied by Casmatic with two wrappers model CMW 424 and two bundlers model CMB 202 - versatile machines that enable us to quickly answer to market demands in terms of packaging. The first, soft, peach-colored ply bears a refined decor which personalizes the roll, while the second ply is white and resistant. The delicate peach fragrance gives the final touch to this special product and also constitutes an attention-grabber on supermarket shelves. Lady Regio is a concentrate of softness and strength, an exclusive product for the Mexican market.
PJL: What was the marketing concept leading the project?
Juan Manuel Rojas Vela - The reference category for other competitors present on the market is given mainly by children while for us, women have been the focus. With the help of the results of a survey developed by Reis and Ries de Mexico - in association with AL & Laura Ries - Copamex decided to concentrate its attention on this target, and focus on the 50 million Mexican women, this veritable core business of its own represents 51% of the total market. A team of five people worked on the project, studying their consumption trends through focus groups, carrying our marketing and demographic research trying to identify the specific demands of women in order to obtain a special hygiene product able to satisfy also their families' demands. We segmented the market in terms of product benefits (what in marketing terminology is referred to as benefit segmentation), attributing an intrinsic value to the simple toilet roll and commercializing Lady Regio as a product for feminine hygiene. The pastel-colored rolls come in a rigorously transparent packaging bearing the face of a candid and natural woman.
Simple and natural: this is the woman we wanted to portray. The wife, the daughter, the mother: the woman who works and who dedicates herself to her family, well aware of her femininity. Our message is directed to them. In an era of mass consumption and market globalization where the key word in every field has become "standardization", we feel that the consumers are not all the same. You must bear in mind that each individual culture's habits and customs are different.
This is the only way to keep abreast of market trends. The addition of the Lady Regio product to the Regio brand family - for over 15 years present on the market and synonymous of quality products - has allowed us to increase total brand sales by 20%. This success consolidates our market position and reinforces our strategy: to offer a wide range of products, to be different from other competitors and to stay abreast of the ever-changing market conditions and consumer tastes.
COnsorcio PApelero MEXicano
Juan Bosco Maldonado as CEO, and Alejandro Ferrigno Maldonado as General Director are at the head of Copamex, a company whose roots are well-founded. It was in May of 1928 that the Maldonado family establishes the "Abastecedora de Bolsas" in Monterrey, Nuevo Leon, for the production of kraft paper sacks. From this original company, which today constitutes the headquarters, investments, acquisitions and mergers which have taken place throughout the years led the Maldonado family to the creation, in 1992, of the Consorcio Papelero Mexicano. The new structure focused on different activities pertaining to the industrial fields of packaging, writing papers and special papers. In that same year, the company decided to embark on a different road, differentiating into a completely new field: the consumer products market. And so the new Consumer Division of Copamex was born for the commercialization of tissue products first, and then increased its portfolio to other categories such as baby diapers, feminine pads, incontinence pads and tissue products for AFH use. The launch of toilet roll products under the brand name Lovly, Vander, Boreal and Gentil established COPAMEX's entry into this new market. Vander and Gentil products' life cycle was brief while Lovly and Boreal continue to be commercialized for toilet rolls and kitchen towels respectively. The strong will to grow and to innovate the company brought the family, in 1996, to sign an agreement with Swedish multinational SCA for the commercialization of feminine hygiene products, baby diapers and incontinence pads. The following year, the acquisition of the Scott group by the American colossus Kimberly-Clark marked a turning point for Copamex.
For reasons of antitrust, K-C had to renounce to a portion of the Scott package. So, thanks to its acquisition of a portion of the facilities sold by K-C in Ecatepec, of the Regio brand for toilet rolls, of Scottis for facial tissue and Shock for notebook papers, Copamex was not only able to widen its range of products but also became the most important company in the field of tissue and paper in Mexico, Central America and the Caribbean, behind the US giant K-C itself. With nine facilities located all over Mexico and a production capacity of 140,000 tons per year, Copamex is not only one of the major groups specialized in the production and commercialization of products derived from cellulose fibres, but it is also one of the main groups in the field of paper products destined both for the industrial as well as the consumer market.
Focus: a look at the Mexican market
Mexico, with a population of 101,879,171 people is a 1,972,547 - square kilometre bridge connecting North and South America. But it is also the most developed and important tissue market of Latin America, both in terms of size as well as consumption.
670,000 tons were consumed in 2002 against the 661,000 registered for 2001. The beneficial influence of the US economy and its entrance in the NAFTA (North American Free Trade Agreement) at the beginning of 1994 are the main factors that contributed to the strong growth of the Mexican economy during the 1990s and to a "widening of the boundaries" in economic terms, thus favouring a growth in imports and exports. Trade is mainly with the Southern United States: two thirds of all trade is given by parent reels while one-third is represented by finished products. The positive economic conditions typical of these last few years have determined a growth in consumption of products destined for domestic use which today represent 83% of total consumption. Toilet rolls are number one in this category with a 69% share and a per capita consumption of 4.6 kg, followed by kitchen towels with an 18% share of consumption and a 1.2 kg per capita figure. These are important figures that cache a change in consumption trends. In these last few years, investments in technology and promotion by US companies present in Mexico are changing market trends but also consumption habits by favouring products that belong to the Premium Quality segment of the market. What results is a transformation in the way consumers perceive quality. The quality range of consumer products present on the market is very vast: it goes from kitchen towels produced using TAD technology and sold in single-roll form, to single-ply toilet rolls made from recycled fibres. The white, perfumed toilet roll, sold in single-roll form as well as in multi-roll packages, is the "typical product" found on Mexican supermarket shelves. Kitchen rolls are found in colored, single or multi-roll packs. The introduction on the market of softer, higher quality products with different types of embossing is creating a net dividing line between premium and medium-quality products, thus changing consumption habits. In Mexico, too, like in many other countries, price is no longer the sole discriminating factor in the choice of a product. The country is going through a phase in which the quality aspect of the product becomes determinant in the purchase choice, thus favouring the penetration of quality products.