In Conversation With Chaitanya Rathi, Former COO, Sula

As part of the early founding team, and later COO, Chaitanya Rathi helped to build Sula and take it to its successful IPO. He is a prolific angel investor, as well as an advisor to venture capital firms, DSG Consumer Partners and Sharrp Ventures, where he has supported the journey of consumer brands like Epigamia and Veeba. 

Sula democratised wine-drinking in India. How did you do that?

When Sula launched, there was a lot of snobbery around wine. There was a listed company called Chateau Indage, which has since closed down. The prevailing wisdom was that you had to copy European products. Sula did the exact opposite, and took great pride in being Indian. There is great acceptance of Indian brands today, but 20+ years ago, Sula was a pioneer. Look at the logo – it is a Sun, with a moustache and a “tikka.” It is inherently Indian in its sensibility. The label also calls out the Nashik provenance boldly.  

Here’s another example. We first launched wine with corks. Then we realised that this was very difficult for Indian consumers. Hardly anyone owned a corkscrew. Even if you did, it was tough to uncork the wine and even harder to store the bottle horizontally in your fridge. Again, going against traditional wisdom, we switched to screw caps and our acceptance and our sales went up sharply. 

From Sula to Epigamia, you’ve worked closely to build brands that are creating new consumption behaviours. What is needed to do this?

CR: I would say a few things are critical for creating new consumption behaviours:

#1. Consumer education: For Sula, we had to educate people about wine from scratch. We focused on the end-consumer, of course, but also other stakeholders in the ecosystem. One of our most successful initiatives was the ‘train the trainer’ program. We trained restaurant and retail shop staff about wine, so they could educate their customers. Sula has a partnership with the Wines and Spirits Education Trust (WSET) in the UK to provide structured programs. 

Wine tourism was a significant part of our strategy. We turned our vineyard into a destination. Today, Sula’s vineyard at Nashik is the world’s most visited vineyard, with over 300,000 visitors last year. They have 120 hotel rooms, four restaurants, and multiple attractions at the vineyard. Imagine the brand impact, when thousands of people every year, sample your product, create content at your vineyard and share it. 

Similarly, with Greek yogurt, Epigamia had to explain how it differs from regular yogurt, why it’s a snack, not a meal accompaniment, and why it’s worth the extra cost. 

#2. Product trials: You have to get consumers to sample your product as much as possible. For Epigamia, in the early days, you would find a representative standing with a sampling tray at retail outlets, offering free tasting.

At Sula, we focused heavily on tastings and trials. Even today, Sula prides itself on the number of tastings conducted across the country. This includes Sula’s own vineyards, where close to 200,000 tastings happened last year, as well as events, hotels, and restaurants. 

It is a matter of pride that many Indians taste their first glass of wine at a Sula vineyard. 

#3. Quality & Consistency.  Rajeev Samant, Sula’s founder, has always focused on quality and I have never heard him articulate his mission in terms of top line, the way so many founders do today.

Instead, his goal was to make each bottle of wine 1% better every year. Consistency was also crucial. It was important that every bottle of wine tasted the same, year after year. This helped build trust with consumers. All the marketing in the world can’t help if you falter on these two aspects.

#4. Availability: This sounds obvious but I am always surprised by how many founders overlook the importance of being easily available. All your effort will be wasted, if you build awareness, but then the consumer can’t find your brand easily.

#5. Patience: There are no shortcuts to building a brand and if you are pioneering a category, prepare for the long haul of at least a decade. Honestly, a lot of category creation just requires you to work from first principles and do the hard work over time.

Few people are aware that the House of Sula actually has multiple brands. Could you explain the brand architecture to us?

Sula actually offers wines from Rs. 300 to Rs. 2000, with a wine at every Rs 100 increment and this price laddering has worked very well for them. 

Initially, the need for different brands arose because there were very few competitors in the market and restaurateurs wanted to create a more diverse wine list for customers. 

The core band of Rs. 700 to Rs.1200 is branded Sula. This contributes about 2/3rds of the revenue. At the top end, you have Rasa and more recently, The Source. At the lower end, you have Madera and Samara. 

What mistakes would you tell brand-builders to avoid?

Brands are not only built on the outside, they are also built on the inside. Founders make the mistake of thinking that a brand is only about what customers see. It is much more than that.  Your team has to believe in the brand. Your investors, your business partners, your retailers and distributors – all  must be brand advocates. It is at those points of interactions that brand reputations are built. 

It is also important for founders to have an omni-channel mindset from the beginning. Don’t have artificial boundaries like “I’ll be online until I hit x crores and then I’ll go offline.” Recognise that you have to be wherever your customers shop, and then be strategic about your expansion. 

Finally, use high quality partners, especially for marketing and design. It is very competitive and today’s consumers have a lot of exposure. Don’t take shortcuts and then regret it later. 

What trends in the current consumer landscape do you think are noteworthy?

I am a big believer in quick commerce. QC replicates the kirana model, where instead of you going to the store, they are bringing the store to you. There is a waiting list of months if you are a new brand. 

I also believe the health and wellness trend will gather pace. More people will read labels and ask for detailed information about what they are consuming. In the Alco-bev space, this is playing out in the form of lower alcohol products. In fact, Diageo has just made an investment in V9 beverages, which owns Sober, a no-alcohol brand for Gin, Whiskey and Rum. 10 years ago, no one could have imagined this. 

Premiumisation will persist, with consumers willing to pay more for aspirational brands. We are also seeing a willingness to experiment with new brands, and notably, consumers now often trust Indian brands over foreign ones. 

These trends, though individually evident, collectively signify a substantial shift in the consumer brand landscape.