Company – Hindustan

UniLever Limited (HUL)

Product – LUX Soap

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Contents Company profileCompany profile Product portfolioProduct portfolio Distribution system and channelsDistribution system and channels Pricing strategyPricing strategy Media usedMedia used competitorscompetitors Promotional activitiesPromotional activities Famous events done in rural IndiaFamous events done in rural India Alternative strategyAlternative strategy

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1. Company Profile

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1. Company Profile

Type :Public company BSE: 500696 Industry :Fast Moving Consumer Goods FMCG) Founded :1933 Headquarters :Mumbai, India Key people :Harish Manwani (Chairman),

Nitin Paranjpe (CEO and MD) Products :Home & Personal Care, Food &

Beverages Revenue :Rs.20,869.57 crore (US$4.61 billion)

(2008-2009) Employees Over :65,000 direct & indirect employees

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Contd..

The Anglo-Dutch company Unilever owns a 52% majority stake.

HUL was formed in 1933 as Lever Brothers India Limited and came into being in 1956 as Hindustan Lever Limited through a merger of Lever Brothers, Hindustan Vanaspati Mfg. Co. Ltd. and United Traders Ltd.

The company was renamed in June 2007 as “Hindustan Unilever Limited”.

Hindustan Unilever's distribution covers over 1 million retail outlets across India directly.

Its products are available in over 6.3 million outlets in the country nearly 80% of all retail outlets in India.

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Contd.. It estimates that two out of three Indians use its many home and personal care products, food and beverages

The company has a distribution channel of 6.3 million outlets and owns 35 major Indian brands

HUL is one of the country's largest exporters; it has been HUL is one of the country's largest exporters; it has been recognized as a Golden Super Star Trading House by the recognized as a Golden Super Star Trading House by the Government of India. Government of India.

HUL was one of the eight Indian companies to be featured on the HUL was one of the eight Indian companies to be featured on the Forbes list of World’s Most Reputed companies in 2007 Forbes list of World’s Most Reputed companies in 2007

The Hindustan Unilever Research Centre (HURC) was set up in The Hindustan Unilever Research Centre (HURC) was set up in 1967 in Mumbai, and Unilever Research India in Bangalore in 1967 in Mumbai, and Unilever Research India in Bangalore in 1997. Staff at these centers developed many innovations in 1997. Staff at these centers developed many innovations in products and manufacturing processes. In 2006, the company's products and manufacturing processes. In 2006, the company's research facilities were brought together at a single site in research facilities were brought together at a single site in BangaloreBangalore

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Community services :1. In 2001, the company embarked on a programme called

Shakti, through which it creates micro-enterprises for rural women-covers 15 states in India with over 45,000 women entrepreneurs in 135,000 villages.

2. HUL is also running a rural health programme, Lifebuoy Swasthya Chetana. The programme endeavors to induce adoption of hygienic practices among rural Indians and aims to bring down the incidence of diarrhoea-reached 120 million people in over 50,000 villages.

Direct Selling Division : HUL also runs Hindustan Unilever Network (HULN), a direct

selling business arm. Under HULN, health products are marketed by AYUSH in collaboration with Arya Vaidya Pharmacy, Coimbatore; beauty products by Aviance; home products by Lever Home, and male grooming by DIY

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(Source- valueresearch.com)

Evolution of the HUL Logo

The previous logo represents the green and healthy scenario of the Indian economy. And the current logo expresses “the vitality at the heart of HUL brands, its people and values. Each icon within HUL logo represents an aspect of their business, showing that they add vitality in everything they do.”

- - (SUN): Our primary natural resource. All life

begins with the sun – the ultimate symbol of vitality. It evokes Unilever's origins in Port Sunlight and can represent a number of our brands. Flora, Slim·Fast and Omo all use radiance to communicate their benefits. 99

Contd..

-(HAND & FLOWER): Hand is a symbol of sensitivity, care and need. It represents both skins and touch. Flower represents fragrance. When seen with the hand, it represents moisturizers or cream

-(BEE): Represents creation, pollination, hard work and bio-diversity. Bees symbolize both environmental challenges and opportunities

-(DNA): The double helix, the genetic blueprint of life and a symbol of bio-science. It is the key to a healthy life. The sun is the biggest ingredient of life, and DNA the smallest

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-(HAIR): A symbol of beauty and looking good. Placed next to the flower it evokes cleanliness and fragrance; placed near the hand it suggests softness.

-(PALM TREE): A nurtured resource. It produces palm oil as well as many fruits – coconuts and dates – and also symbolizes paradise.

-(SAUCES & SPREADS): Represents mixing or stirring. It suggests blending in flavors and adding taste.

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Contd..

-(BOWL): A bowl of delicious-smelling food. It can also

represent a ready meal, hot drink or soup

-(SPOON): A symbol of nutrition, tasting and cooking.

-(SPICE & FLAVOURS): Represents chili or fresh ingredients.

-(FISH): Represents food, sea or fresh water.

-(SPARKLE): Clean, healthy and sparkling with energy 1212

. -(BIRD): A symbol of freedom. It suggests a relief from

daily chores, and getting more out of life. -(TEA): A plant or an extract of a plant, such as tea.

Also a symbol of growing and farming -(LIPS): Represent beauty, looking good and taste. -(ICE CREAM): A treat, pleasure and enjoyment.

-(RECYCLE): Part of our commitment to sustainability.

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.. -(PARTICLES): A reference to science, bubbles and

fizz.

-(FROZEN): The plant is a symbol of freshness, the snowflake represents freezing. A transformational symbol.

-(CONTAINER): Symbolizes packaging - a pot of cream

associated with personal care -(HEART): A symbol of love, care and health.

-(CLOTHES): Represent fresh laundry and looking good.

-(WAVE & LIQUID): Wave symbolizes cleanliness, freshness and vigor. Liquid a reference to clean water and purity

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2. Product Portfolio

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2. Product Profile - HUL

Personal wash: Lux, Lifebuoy, Liril, Hamam, Breeze, Dove, Personal wash: Lux, Lifebuoy, Liril, Hamam, Breeze, Dove, Pears, RexonaPears, Rexona

Laundry: Surf excel, Rin, WheelLaundry: Surf excel, Rin, Wheel Skin care: Fair & Lovely, Ponds, Vaseline, AvianceSkin care: Fair & Lovely, Ponds, Vaseline, Aviance Oral care: Pepsodent, Close upOral care: Pepsodent, Close up Deodorants: Axe, RexonaDeodorants: Axe, Rexona Colour cosmetics: LakmeColour cosmetics: Lakme

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Contd..

Ayurvedic personal and health care: Ayush Shampoo: Sunsilk, Clinic Tea: Broke bond, Lipton. Coffee: Bru Foods: Kissan, Annapurna, Knorr Ice cream: Kwality walls

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Product Segmentation at HUL

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3. Distribution Systems & Channels

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HUL has also revamped its sales organisation in the rural markets to HUL has also revamped its sales organisation in the rural markets to fully meet the emerging needs and increased purchasing power of the fully meet the emerging needs and increased purchasing power of the

rural populationrural population..• The team comprises an exclusive sales force and exclusive The team comprises an exclusive sales force and exclusive

redistribution stockists, under the charge of dedicated managers. redistribution stockists, under the charge of dedicated managers. HUL's distribution network in rural India already directly covers HUL's distribution network in rural India already directly covers about 50,000 villages, reaching about 250 million consumers, through about 50,000 villages, reaching about 250 million consumers, through about 6000 sub-stockists.about 6000 sub-stockists.

• HUL had relied on its network of 2,700 redistribution stockists and HUL had relied on its network of 2,700 redistribution stockists and sub-stockists to supply products to stores in large villages. For smaller sub-stockists to supply products to stores in large villages. For smaller villages with a population of less than 5,000, its products were sold villages with a population of less than 5,000, its products were sold through wholesalers. Shopkeepers from these villages would travel to through wholesalers. Shopkeepers from these villages would travel to these wholesalers and to pick up their supplies as and when it suited these wholesalers and to pick up their supplies as and when it suited them. Sometimes wholesalers known as star sellers would hire a van them. Sometimes wholesalers known as star sellers would hire a van and do some distribution on their own.and do some distribution on their own.

4. Pricing Strategy - LUX

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4. Pricing Strategy - LUX

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5. Media Used

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5. Media Used

The various types of media used by HUL for Lux soaps are as follows :

Televisions Print Media – Newspapers, Magazines, etc. Radio

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6. Competitors

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Internal Competitor: Lifebuoy: 1895, 18% Market shares

External Competitor:Godrej consumers products limited (GCPL): 2nd Largest soap maker after HUL 9.2% Market share Brands: Cinthol, Fairglow, Nikhar

Wipro: Brand: Santoor (No 1 in AP) and Chandrika

ITC: 1.75% growth in initial five months Brand: Superia, Fiama di wills and Vivel Sold in six states

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Competitors of HUL SOAPSHUL brands

Lux

Rexona

Breeze

Lifebuoy

PearsPears

DoveDove

HamamHamam

Competitors brands

Santoor, Chandrika

Cinthol, Mysore Sandal

Godrej no. 1, Nirma

Dettol

SantoorSantoor

CamayCamay

Margo

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57% 55% 55%

52%

10% 9%8% 8%

9%

5%

HUL’s SOAP MARKET SHARE

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7. Promotional Activities

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7. Promotional Activities for LUX

The various promotional activities done by HUL for Lux soap are given as follows..

Gold coin offer Buy 3 get 1 free Lux soap bar 25 gm free on every lux soap bar Providing gifts to retailers

- Holiday packages

- Discount offers

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8. Famous Events done in Rural

India

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8. Famous Events done in Rural India

8.1 Project Streamline

In the late 1990s, HUL took its first tentative step to expand rural distribution. Through Project Streamline, it created a hub and spoke system and appointed sub-dealers who had the opportunity to serve villages in their vicinity.

Smaller regional brands would come along, offer better markups and sell goods on credit and take away a significant portion of business in a short span.

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8.2 Project Shakti

Starting 2001, it began expanding its reach through Project Shakti, where it used women entrepreneurs in distant villages to stock and sell its brands.

It utilized the concept of self help groups

Shakti also includes health and hygiene education through the Shakti Vani Programme, which now covers 15 states in India with over 45,000 women entrepreneurs in 135,000 villages

By the end of 2010, Shakti aims to have 100,000 Shakti entrepreneurs covering 500,000 villages, touching the lives of over 600 million people

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8.3 Operation Bharat

Under “operation Bharat”, they introduced sachets of clinic plus, ponds,close up and fairness cream to make sachet buying a habit for these consumers.

Seeing that the rural retailers sell the cut lifebuoy cakes to the consumers, it came up with 75 gm soap cake and later launched 18 gm life- buoy soap, priced at Rs. 2.

India’s 16% contribution to the world population and 28% to world’s hair shows the latter’s role in accentuating the physical appearance of an individual. Indigence forced the rural community to use the same soap for hair and skin, since a Rs. 2 shampoo sachet categorized itself as a luxury item for them.

HUL, having taken a cue from this insight, introduced Breeze 2 in 1, a multipurpose soap for hair and skin !

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8.4 Lifebuoy Swasthya Chetna

It spread information on how washing hands can keep diseases away, targeted a population of 5 crores in 15000 villages.

It applied 2 approaches :

• HUL employed Health Development Officers and Health Development Assistants who went to all the villages and educated the community through lectures and community meetings.

• They returned to the villages after 2 months, offered toys, badges and medals to children who had made it a habit to wash hands regularly ( read saved “Lifebuoy” soap wrappers ) and a certificate to the children who had won these badges most often.

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8.5 Khushiyon Ki Doli

‘Khushiyon Ki Doli’ is the first multi-brand rural engagement module started by HUL

The main objective of the campaign was to reach out to media dark villages with HUL brand messages and to engage with consumers deeply to rapidly change brand adoption metrics.

It involved various personal care and home care brands of HUL including Wheel, Surf Excel, Fair & Lovely, Sunsilk, Vim, Lifebuoy and Close Up

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The process of making contact includes three steps : :

- Awareness: The first step is achieved through 4-5 teams of promoters who head to each village and invite the residents to gatherings that are termed ‘mohallas’ to make them aware of the company and its products. The events are conducted in the local language for small focused groups which is supposed to encourage greater engagement and involvement for the audience

- Consumer Engagement: In the second step, post the mohalla activity, the promoters go door-to-door and conduct consumer home visits to generate trials where they offer promotions to the consumers.

- Retail: Finally, there is another team which visits all the shops in

the village which ensures improved availability and visibility of the brands

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9. Alternative Strategies

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Alternative Strategies

Ayurvedic variant

Lux kids special soap

Target male customers

Introduce Bhojpuri actors as Brand Ambassadors for the rural market with reference to their popularity ratio respectively.

Riverside Hoardings

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Sources-Sources-

www.wikipedia.orgwww.wikipedia.org www.hul.inwww.hul.in www.google.comwww.google.com www.valueresearch.comwww.valueresearch.com

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