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Case Study OnCavinKare Private Limited
A CHALLENGE OF SUSTAINING GROWTH AND EXPANDING BUSINESS
04/15/2023
Presenters:Kabita DhimalAshir KhadkaYashika GoyalBabina Poudel
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Introduction• Mr.C.K.Ranganathan, the Founder Chairman • Started from Chik India in 1983 with an initial
investment of Rs. 15,000• Changed its identity :
– 1990 :Beauty Cosmetic Pvt. Ltd.– 1998 : Cavinkare Pvt. Ltd.– Products : Personal Care, Food, Beverages,
Dairy and Snacks
04/15/2023
Identification of Consumer Needs• First identification in the early’s 1980:
– Need for superior quality shampoo with affordable price.– Clinic plus and shampoo targeting urban area– Introduce chik sampoo in 1983– Targeted consumers having lower income 1000-1500 per
month– In 1984, Increased the sales from 0.5 million to 3.8
million in 1 year – In 1990, raised to 35 million
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Contd..• Second identification gap:
– CavinKare realized the gap for the need of herbal shampoo
– In 1993, it rolled out Nyle shampoo.– Positioned it at the safest shampoo to
use.– By 2001, Nyle was among top five
shampoo brands
04/15/2023
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Gaining Consumer Insights• Using insight CavinKare entered the fairness cream market
and launched the “Fairever” brand of fairness cream in 1998.• Based on another consumer insight, CavinKare introduced
Meera herbal hair oil in 2004
04/15/2023
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Delivering Customer Value through Affordable Products
• It focus on volumes and scale of economy resulted in lower costs of production.
• CavinKare entered the perfume business to introduce quality perfume at an affordable price.
• It launched perfume brand Spinze in the Year 1997.
• The product was introduced in bottles as well as small packs called “Dab-on”.
04/15/2023
Cost Advantage• Reduced Structure of Cost• Outsourcing the manufacturing operation.• Decreased overhead cost • Nimble and agile organization• Helped to focus on marketing and distribution• Supported by its world class R&D infrastructrue
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Packaging Innovation: Sachets and Low units pack
• Sachet shampoo introduced in 1976 for velvette by Chinni Krishnan
• Popularized by Ranganathan through chik(LUPs)• High acceptance• Helped in the risk of trial• Innovative packaging
– In 2000, introduced single use perfume ‘c’– Help trial use and new users to product– Concept of “Once a day”
04/15/2023
Distribution Access
• Difficult to gain distribution access in rural areas• Targeted haats and Melas
– Server 4000 consumers– 47000 haats and 25000 melas in a year– Rs. 0.2 million in haats– Rs.1.43 million in melas
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Road Ahead• Successfully competed big companies• In 2001:• Chik and Nyle became leading companies –Rs 8500 million• Fairever stood umber 2 in cream –Rs 6500 million• In 2003:• Turnover of 2640 million• Estimated to be 52 billion by 2012• Two-pronged strategy
– increase market share of its current product– Diversify into new business
04/15/2023 13
Increase Market Share of Product
• Still huge gap in market share of Unilever • Fairever 9.5 % vs Fair and lovelt 62% in 2003• In 2004, deodrant have 3% market sahre• In perfume category spinz have 7%• Spinz talc have 4.27% vs 55% of ponds talc
04/15/2023 14
Diversification into New Businesses
• Entered into food and retailing business• Entering to the soap and detergent
– Organic and non-organic route to grow• Entry into food
– Launched pickles to grow-Chinni• Retailing Ambition
– Branded and skincare salon– Invest 250million and open 250 salons named green trends
04/15/2023 17
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