CASE ANALYSIS

OF

CONSUMER PRODUCTS LIMITED

PUNJAB COLLEGE OF TECHNICAL EDUCATION

SUBMITTED BY: Inderdeep

Singh PGDM-1

EXECUTIVE SUMMARY

Consumer Products Ltd. was a public limited company and leading in marketing and

manufacturing in household goods. Marketing was their co-coordinating function and the

marketing management had the profit responsibility for a particular product/product group.

Washing product is the major profit centre of the company. Their main product ‘DAZZLE’

accounted for 1/3rd of profit of washing group. The washing powder market was 1/10 th of the

washing soap market. The product quality is superior to all others. The company’s market share

was 80 present till September 1966. But, after it faced a solid competition from Spark, CPL’s

market share reduced. Now the company had to decide as to how to regain profitability growth.

CASE FACTS

CPL is a leading in manufacturing and marketing in household products.

Washing product was the major profit centre for the CPL.

Their main product ‘DAZZLE’ accounted for 1/3rd of profit of washing group.

Fabric washing market is divided into two products- Washing Soaps and Washing

Products.

WASHING SOAPS- small-scale units operating in very small localized areas

contributed more than 3/4th of the washing soap, they have inferior quality and had poor

distribution channels at national level

WASHING POWDER- production located entirely in the organized large-scale sector

of the industry requiring greater technical knows.

Washing powder market was 1/10th the size of washing soap market, but high profitability

because of higher margins

The market for washing powders was restricted to large urban towns and the market was

highly competitive but had high growth potential in small towns.

But difficulties in distribution and the high cost at distribution in smaller towns. The

transportation part was left to the wholesaler’s trade channels

Four main brands in washing powders market: DAZZLE, BRIGHT, WHITE and

SPARK.

White and Spark - marketed by the same company.

Dazzle- leading in market share of washing powder until September 1966. It enjoyed a

market share of 80 percent of the total washing powder market. Bright-10%, White-7%,

Spark 3%

Until September 1966, Dazzle, Bright and White were sold in similar carton pack sizes of

700gm, 400gm, 200gm but Spark was sold only in bulks as 1kg and 2kg

Dazzle- superior quality, expensive, targeted urban population

White and Bright- Inferior quality, Cheaper, targeted small towns.

Dazzle, Bright, and White- heavy expenditure on theme based advertising and some

consumer promotion such as free gifts.

Spark’s Promotion Strategy as on September, 1966

- Pack size 1 kg, 2 kg.

- Plastic bucket for Rs. 6 on six cartons of large pack

- A coupon was printed on each large carton, six of these coupon could exchange at

retail store for gift.

As a result, market share of Spark rose to 10% to 25% within just 4months.

White and Spark were marketed by same company.

SITUATION ANALYSIS

CPL is a leading company with authorized cap of Rs.10 crores, dealing in household products.

Marketing is their co-coordinating function and the marketing management has the profit

responsibility for a particular product/product group. Washing product is the major profit centre

of the company. Their main product ‘DAZZLE’ accounted for 1/3 rd of profit of washing group.

The product quality is superior to all others. Since the washing powder market is restricted to

large urban areas, CPL has an opportunity to provide in smaller areas. But difficulties of

distribution and the high cost of going to the smaller towns are acting as barriers. Hence they had

to rely upon wholesale trade channels in such areas. Till September 1966, Dazzle enjoyed a

market share of 80 percent of the total washing powder market. But after that Spark came up

with all new promotion strategy and its market share increased drastically. Now CPL needs to

regain their market share. Along with this, there is a conversation between CPL’s marketing

Team.

Marketing Manager and Marketing Controller and they suggest that CPL should

come up with second Brand with higher quality then Spark but with lower rate.

General Sales Manager and Sales Manager and they suggest that step up the

expenditure per ton to the level that of Spark and counter Attack with Heavy Promotion.

Promotion Manager and Production Manager and they suggest that Promote Dazzle

same as Spark, gift should be more attractive then spark’s gift, put money in press,

cinemas and point-of-sale materials.

PROBLEM DEFINITION

1. What was the reason behind the declination of dazzle?

2. What Promotion strategy CPL adopts to counter Spark?

3. What Should CPL do to regain profitable growth?

ALTERNATIVES

The various alternatives available with CPL are as follows:

Create awareness of product with heavy theme based advertisement.

Launch new product to counter Spark and cater to rural market.

Look for distributers in small and rural areas.

Do proper research on declination of DAZZLE‘s Market Share.

Produce and marketed new product and capture market share in different segments like

cleaning sprays for mirrors, Dish wash liquid, liquid conditioner for cotton fabrics, Toilet

cleaners.

Provide attractive offer with gifts like in every pack there is a table spoon in order to

measure it and another one is provide water proof gloves to protect the user’s hand.

SOLUTION

After analyzing the case and examining the various alternatives, I suggest that the company

should come up with a few new products to satisfy urban population.

They should expand their distribution networks because pie of market share is increasing.

The company should come up with attractive offer and gifts in order to counter attack

Spark.

Company should cut down the cost on manufacturing and focus on theme based

promotions.