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Iqra University Gulshan Campus
Group Members:
Fahimullah Baig
Dated: May 5, 2009
Subject: Introduction to Business
Topic of Project: Marketing (Surf Excel)
Submitted To: Mazhar Ali
Business Profile
Business Name: Unilever Pakistan
Location: Unilever Head Office near Avari Plaza Fatima Jinnah Road Karachi
Telephone: 5660062-9(Karachi)
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Acknowledgement
We are thankful to our course instructor, Mazhar Ali whose encouraging guidance enabled us to prepare the report based on Marketing Strategies of Surf Excel.
We also take this opportunity to show our deep gratitude to all persons who have directly or indirectly helped us while making this informative report.
No doubt, all the people who were involved while making report played an active and wonderful role.
Fahimullah Baig (3288)
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Executive Summary
Unilever was created in 1930 when the British soap-maker Lever Brothers merged with the Dutch margarine producer.
Unilever Company came into the Pakistan market in 1949 with the name of Lever Brothers Pakistan.
Changed the name Lever Brothers Pakistan to Unilever in year 2003.
The leading consumer products company in Pakistan, a multinational with deep roots in the country.
The average per annum consumption of laundry detergent in Pakistan is approximately 33,000 tons.
Launched somewhere in 1960, Surf Excel was the first in the Pakistan Laundry detergent market.
Surf Excel enjoys a huge market share of around 38 percent of total consumption.
Keeps the colour of fabrics as original and vibrant.
Major competitors are Ariel, Brite, Express , Bonus.
Under the BCG Matrix, Surf Excel lies in the Star category.
The product is in the growth stage, and continuously growing.
Divides the market segment on the basis of income group.
Intensive Distribution Network all over Pakistan.
The brand advertisement plan is based on annual basis.
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Company Mission Statement
The leading consumer products company in Pakistan, a multinational with deep roots in the country.
Meet the everyday needs of people everywhere – to anticipate the aspirations of consumers and customers and to respond creatively and competitively with branded products and services which raise the quality of life.
Drive to serve consumers in a unique and effective way.
Attract and develop highly talented people, who are exited, empowered and committed to deliver double-digit growth.
Serve everybody needs of all the consumers everywhere for foods. Hygiene and beauty through branded products and service that deliver the best quality and value.
Strive to maintain an ever simple and enterprising business.
Use superior consumer understanding to produce breakthrough innovation in brands and channels.
Committed to making continuous improvements in the management of our environmental impact and to the longer-term goal of developing a sustainable business.
Brands capture the heart of consumers through outstanding communication.
With branded products and services which raise the quality of life.
Through managing a responsive supply chain management, they maximize value from suppliers to customers.
They are exemplary through commitment to business ethics, health, environment and involvement in the community.
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TABLE OF CONTENTS
Acknowledgement.................................................................ii
Executive Summary..............................................................iii
Overview...............................................................................1
Unilever........................................................................................................1Industry Profile.............................................................................................2Surf Excel......................................................................................................3Major Competitors........................................................................................4
Branding...............................................................................6
Market Segmentation............................................................7
Marketing Strategy................................................................9
Positioning..........................................................................10
Packaging and Labeling.......................................................11
Loyalty Pyramid...................................................................12
Product Life Cycle................................................................13
Sales Promotion and Advertisement.....................................14
Channel and Customer Department (C & CD).........................15
Pricing Consideration and Approaches..................................16
Distribution Channel and Supply Chain Management.............17
Market Distribution.............................................................18
Conclusion [SWOT ANALYSIS]...............................................19
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Overview
Unilever
Unilever was created in 1930 when the British soap-maker Lever Brothers merged with the Dutch margarine producer, Margarine Unie.
At that time, an international merger was an unusual move. But the owners of the two companies could see that bringing together complimentary businesses with strong global networks would create new opportunities.
In the Thirties, Unilever introduced improved technology to the business. The business grew and new ventures were launched in Latin America. The entrepreneurial spirit of the founders and their caring approach to their employees and their communities remain at the heart of Unilever's business today.
Unilever has universal appeal. One of the largest producers of packaged consumer goods, Unilever operates in 150 countries in Asia, Africa, North America, the Middle East, Western Europe, and Latin America.
Unilever is one of the world's leading suppliers of fast moving consumer goods in foods, household and personal care products. Unilever are growing biggest brands through innovative product development and compelling brand communications. Each of these brands has enormous potential to meet the changing needs of consumers through a variety of products that fulfil their brand's promise. At the same time they also have the potential scale, profitability and international appeal needed to be world-leaders.
Unilever Best foods' strength lies in its ability to tailor products to different markets and anticipate consumer’s demands. This comes from in-depth understanding of the countries in which they operate and policy of listening to the customers.
Employing more than 247,000 people, Unilever is part of the Unilever Group owned by the Netherlands-based Unilever N.V. and UK-based Unilever PLC. Unilever has two global divisions, Home & Personal Care and Food.
In much of the world, Unilever leads the Home Care market, which includes cleansing and hygiene products. Many of the products are market leaders.
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Industry Profile
For many centuries, soap was primarily used for laundering. However, laundry detergents have essentially replaced soap because they perform over a broad range of water hardness levels.
Laundry Detergent and washing powders have become an important part of every consumer’s life. The market offers a variety of washing powders, each brand claiming to wash the cleanest at unbeatable prices to consumers. Laundry detergents, however, exert a hidden but taxing cost on the environment and consumer health due to their environment-damaging properties. Phosphates are one of the main ingredients in most present-day laundry detergents and are also the primary culprits in polluting water bodies. Laundry detergent is also widely used in the Pakistan market, the average per annum consumption of laundry detergent is approximately 33,000 tons - One tone detergent costs around 138,000 Rs.
Since the last two years, the market trend (Pakistan) in the laundry detergents has taken a good pace, and many consumers are switching from the bar soaps to laundry detergents. In terms of percentage, the increase ratio is about to 20-25% per annum.
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Surf Excel
Launched sometime in 1960, Surf Excel was the first in the Pakistan detergent powder market. Over the years, Surf Excel has anticipated the changing washing needs of the Pakistan homemaker and constantly upgraded itself.
Surf Excel is Pakistan's largest selling compact detergent powder, it promises to tackle the toughest stains without damaging the colour of the fabric. This is because only Surf Excel has smart sensors that can differentiate stains from colours. Now consumers don't have to worry about tackling the really tough stains, especially on coloured clothes anymore.
Surf excel with active oxygen is formulated to remove a range of stains such as chocolate, ink, egg yolk, blood, turmeric and coffee. It gives clothes a complete cleaning while caring for the fabric. It is recommended by Singer (Manufacturer of Electronic appliances) for use in top loading washing machines.
The green speckles penetrate deep into the fabric to help remove tough stains. The blue speckles give shine to whites and brightness to coloured clothes.
Its refreshing fragrance keeps the fabric smelling fresh long after they have been washed. It is being recommended by leading washing machine and apparel manufacturers around the world.
Those preferring the modern and convenient way to wash can rely on Surf Excel Liquid. The liquid form penetrates deep, allowing great wash results. For really tough stains, consumer can apply the liquid directly on the body of stain and tough stains being tackled with ease.
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Major Competitors
Market share plays a prominent role in business research and standing in the market. Although Surf Excel is the leading brand, it also faces competition.
Major competitors for Surf Excel are:
Ariel BriteBonus and Express
Ariel
Procter and Gamble market nearly 300 brands - including Pampers, Tide, Ariel, Always, Whisper, Pantene, Bounty. In July 1997, they launched Ariel in Pakistan based on a sophisticated and advanced formula. Its breakthrough formula was warmly welcomed by the Pakistani consumers and in a short time span it steals a significant amount of market share from Surf Excel.
New Ariel delivers against one of the key Pakistani consumer needs: a detergent that can give spotless cleaning to both coloured and white clothes. This is because new Ariel contains a unique double action system, which gets fully dissolved unlike bar soap.
Brite
Colgate Palmolive - backed by Lackson Group of Industries, entered into the laundry detergent market by launching a product with a name Brite in 1980. Although it was unable to capture the significant market share of Surf Excel, but is one of its main competitors. Brite also changes its packing from poly bags to suit the needs of consumers.
Bonus and Express
Bonus and Express, both products of Colgate Palmolive - backed by Lackson Group of Industries, are a few of the oldest laundry detergents in Pakistan and enjoy a reasonable amount of share in laundry detergents market. Because of the low price factor, they attract the lower segment of the
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market. But due to inferior quality and less fragrance, they are unable to attract huge market.
Market Share
In term of market share Unilever Surf Excel enjoys the maximum; graphically it can be represented as:
Surf Excel - 38%
Ariel - 28%
Bonus - 16%
Brite - 11%
Express - 7%
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Branding
Consumer loyalty is fast becoming a disappearing phenomenon with an increasing demand for brand variety
In an increasingly borderless world, consumers are getting exposed to both information and choices overload, making them increasingly confused about brands, Surf Excel branding strategy based on corporate branding strategy, where the product of a company has its own name without any company name added, the product belief in ‘complete cleaning and care’.
The ‘Brand image of Surf Excel ‘with reference to the other products in term of percentage is:
Surf Excel - 49%
Ariel - 31%
Brite - 15%
Express - 5%
Surf was losing its identity on its own, ‘People ask for Ariel Surf, Brite Surf or Wheel Surf.’ Or even Surf Excel.
Surf has become a very generic name over the years. There was thus a fear that customers would switch over to some other competing brand, unknowingly, even without paying attention to the brand of the product. The movement is being seen as an attempt to give a more specific and clear identity to the established brand. After more than 40 years, the brand will dissolve into a new identity — Surf Excel. They migrated from Surf to Surf Excel, as Surf has become generic and many people today refer to any detergent as Surf. Besides, they feel that this brand has the chance of attracting new users under the Surf Excel name
From time to time they changed their brand names as under
Surf UltraSurf MicroSurf Powerand now Surf Excel
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Market Segmentation
Market segments are group of customers having similar needs / wants and preferences. It enables the organization to more closely match it marketing mix with the customers of same needs or demands.
Consumers can be grouped and served in various ways based on geographic, demographic, psychographic and behavioural basis.
Ideally every consumer is a different market segment, but in order to maintain the balance between mass production and focused on individualism Surf Excel divides the market on the basis of income group, For each identified segment they market the product in various sizes,
Surf Excel is the Market leader in the laundry detergent market; it caters all the segment of the society by offering different sized of Stock Keeping Units - SKU(s) segmentation based on different family sizes and the income groups.
The reason for those SKU(s) is to pass maximum alternatives to the different segments based on various economic classes and segments, Company also launched a 15 gms packing in order to penetrate deeply in the less income group whose income may less than 3,000 Rs., their SKU(s) are:
Segment Packing Price (Rs.)
Higher 2Kg 1951 Kg 99
Middle700 gms 75400 gms 45100 gms 15
Lower35 gms 515 gms 3
Those SKU(s) allow Surf Excel to deeply penetrate in the market by covering all possible washing powder consumers, based on income group. It also enjoys the market share of around 38% among the total branded laundry detergents in Pakistan.
35 and 15 gms SKU(s) are also called hanging SKU(s), it targets in lower class of society areas, like Orangi Town, Sohrab Goth, Shair Shah. Company gives special focus on the availability and visibility of these particular two SKU(s) (35 & 15 gms) in all shops of those low-line areas.
The purpose of focussing on these SKU(s) is to cater the demand of the consumers as per their low purchasing power and capacity to buy the well
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known brand and to generate more and more trials among the consumers to make them brand loyal. That is why the company calls these small SKU(s) a trial generation SKU(s).
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Marketing Strategy
Marketing strategy is much proactive. As far as the external environment is concerned, they spend heavy amount on advertisement media. From the whole advertisement expense, 80 percent of share goes to electronic media, and the remaining 20 percent goes to print media.
Due to premium brand, they need to have heavy advertisement on electronic media, and advertisement strategies based on consumer-pull.
In most of its advertisements, Surf Excel looks connected to famous personalities, such as recently they launched an ad featuring famous Pakistan Cricketer Shoaib Akhtar.
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Positioning
Surf Excel positions a brand by saying ‘Complete Cleaning and care’. This positioning does not only claim that the laundry detergent Surf Excel is a stain remover but it also claims that it is gentle on the fabric texture and colour, meaning it is hard for stains by removing them instantly, and soft for the fabric material by increasing its life.
Surf Excel is one of the first detergents in the laundry industry, which not only positions itself as a stain remover but also builds an image for the care of fabrics by increasing the life of the fabric.
Most of the other laundry detergents just focused only on stain removing and does not target properly for the care of fabrics but Surf Excel contains ‘Smart Stain Sensor’ that direct active cleaning power to where it is needed most, and it does not only remove stains, but it also gives fragrance and increases the life of fabrics.
So Surf Excel positions its brand as more consumer focused and gives them a thorough understanding of the product.
From the positioning point of view, Surf Excel gives a feeling of family among the consumers.
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Packaging and Labeling
Surf Excel has recently changed its colour scheme from dark colours to light and smooth colour combinations.
The reason of this colour combination is to attract consumers with sophisticated light colours and to differentiate between the old stocks which had different fragrance. The new fragrance used is different and pleasant.
Surf Excel has also changed the written material on the back side of their package. They have introduced child stories on the back of the packing material to attract families.
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Loyalty Pyramid
The company has always taken care of its committed customers by offering them the best stain removing quality at a reasonable price. This product also provides customers with different consumer promotions, like ‘paint masti’ and other events.
Due to all these activities and other consumer promotion factors, consumers are emotionally attached with this brand.
In the loyalty pyramid, most of the customers come under the category of committed buyer, and they argue if someone asks them to change the brand.
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Brand Friend
Satisfied Buyer (Switching)
cost)
Switcher / Price Sensitive
Committed
Satisfied / Habitual Buyer (No Reason for
change)
Product Life Cycle
Surf Excel has regained its market share, and the number of consumers is increasing day by day. It is able to do that due to the fact that it has the best stain removing quality and gives a pleasant fragrance after washing which captures the heart of consumers.
After seeing the purchasing power of different segments in the society and keeping an eagle eye on the competitor’s move in the market, they cut down their prices in order to facilitate the consumers and to maximize its use and in the same way to generate the trials even in the lower classes of the society.
The soap industry is gradually decreasing day by day, and consumers are switching from soaps to laundry detergents, because of ease of use and attractive fragrance. Surf Excel is into the growth stage, the market size and the relative market share is increasing day by day.
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Product Life Cycle
Growth
Decline Due to Ariel (1997-2000)
Introductory2001
2002-2003
Sales Promotion and Advertisement
The brand advertisement plan is based on an annual basis, which is made on the basis of assumptions and competitors’ moves. These plans are discussed and reviewed every month and modifications / changes are made if required. If any change is required than it needs to be approved from the Directors.
They divide the advertisement budget into two parts, first part is focused on theme advertisement, and other focused on promotional activities.
As a premium brand Surf Excel needs to have heavy advertisement on television. Other media also used keeping in view the target consumers.
The reason for heavy advertisement on Television is because TV is the major influencer media, so major share of the advertisement goes to TV.
For Promotion purposes, they give
Trade offersFor trade offers, they offer 36 Rs. Discount per carton etc.
Sales Force PromotionFor distribution sales force, they give 1,000 Rs. to the District sales representatives (if they achieve their targets).
Consumer PromotionFor consumers they offer promotions from time to time by providing offers such as 25% Extra quantity, 26 Rs. off, they also some times include sachet of the other products in order to generate the trials of different Unilever brand SKU(s) through the strength of Surf Excel’ large consumer base.
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Channel and Customer Department (C & CD)
In C & CD, first comes the Director, under that Director comes a General Sales manager, this General Sales manager leads five Regional Managers in the country, Regional Manager of Karachi leads five Area Sales Managers (ASM), and each Area Sales Manager has eight Territory Sales Officers (TSO).
This department is responsible for the sales target of the entire Pakistan, basically targets are given by they region (Singapore) and than the C & CD department distributes the targets accordingly to the contribution of each different region in Pakistan.
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C & CD Director
General Sales Manager
Regional Manager(Karachi)
Regional Manager
Regional
ManagerRegional Manager
Regional Manager
5 ASMEach ASM has 8 TSO’s
Pricing Consideration and Approaches
Keeping an eagle eye on competitors’ moves (such as Ariel) which recently decreased their prices by 20 - 25%, to get maximum share from Surf Excel (Ariel has already experienced this price penetration strategy in Vietnam, Malaysia and India where they have significantly increased their market share from 13% to 44%). Unilever - due to this threat and to maintain the market share in its laundry detergent business - took proactive action and practiced the product penetration strategy with reference to Ariel’s moves; the company has decided to reduce prices of its Surf Excel Brand by 20-25%.
The price of the one kg pack of Surf Excel will now be reduced from 125 Rs. to Rs 99 Rs (1 Kg pack), The need of reduction of prices arises when the nearest competitor reduces his prices in Vietnam and other countries, and by reducing the prices is able to get double its share in the market.
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Distribution Channel and Supply Chain Management
Unilever has an Intensive dealership network of 450 distributors all over the Pakistan, Unilever also prohibits distributors from carrying competitive brand of competitors. For distribution it supports intensive distribution policy which suggests targeting the product through each and every outlet.
In Karachi itself there are 7 distributors for all its products, those 7 distributors distribute the product all over the 17,500 shops twice a week, form those 17,500 shops there are 2,000 whole-sellers, who distribute the supply further to the other 7,000 shops.
Apex – Federal B Area, Gulshan, Gulistan – E – Johar.
Gizri - Defence, Soldier Bazar, Pakistan Chowk, Saddar, Bahadurabad, and Tariq Road.
Irfan Traders - North Nazimabad and Buffer Zone.
Al-Hamza - Orangi town.
Saya - Juria Bazar.
Creative - Shah Faisal Colony, and Malir.
Mehtab - Landhi and Korangi.
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UnileverDistribution
Apex Marketing Services
Gizri Corporation
IrfanTraders
Al-Hamza Saya Creative Mehtab
Market Distribution
General Trade Modern TradeOut of Home
Market Distribution
Unilever distributes Surf Excel in the market through the following channels:
General Trade
All classes of retail outlets, such as A, B, C, D, E and the whole-sellers are targeted by general trade, Normal trade discounts, offers and consumer promotions are given by the company and time to time merchandising competition are run.
Out of Home
The markets such as Hotels, restaurants, and Army CSD’s stores are covered by this distribution channel.
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Modern Trade
In order to retain and maintain the customer base especially in the upper class, upper lower class, and upper middle class of the society. Modern trade focuses on self service stores. Special and trade offers and consumer promotions are run by the company along with the creative merchandising competition, these all activities are meant to capture the market, and maintain its customers and to increase brand loyalty.
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Conclusion [SWOT ANALYSIS]
Unilever has an efficient distribution structure for Surf Excel. In order to conclude all the things which we discussed or enumerated hereinabove, its looks more appropriate to do the product analysis on the basis of Strength, Weakness, Opportunities and threats [SWOT Analysis].
Strengths
Since Surf Excel or just Surf has been in the market of Pakistan since 1960, therefore it has an ultimate strong brand image.
Industry analysts said Surf Excel will now become the mother brand and a market leader.
Keeps the colour of fabrics as original and vibrant.
Surf excel is a better stain remover, with active oxygen formulation it removes a range of stains such as chocolate, ink, egg yolk, blood, turmeric and coffee.
Strong back-up of highly professional and trained Brand and Marketing Managers and a strong company name Unilever.
Extensive knowledge of market.
Weaknesses
Surf had become a very generic name over the years. There was thus a fear that customers would switch over to some other competing brand, unknowingly, even without paying attention to the brand of the product.
Unable to market rural area properly, which consist of around 70% of total.
Opportunities
Still lots of consumers use open laundry detergent without any brand recognition, so they can expand and enter the growing market.
The market for laundry detergents is growing day by day, and many consumers are switching from bar soaps to laundry detergents.
Increase number of working woman with changing life style, who needs comfort and easy to use laundry detergents.
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Threats
Ariel is its closest competitor. Due to policies of Ariel, Surf Excel also needs to review its prices again and again.
Ariel takes quick decisions.
Low literacy rate in Pakistan, and agitation against foreign companies may become a threat and consumers may stop using the foreign products.
Overall it was a great learning experience for us and it provided us a new horizon of knowledge and endeavor.
References: Mr. Sabeen Fazli (Marketing Manager) Unilever Main Head Office
Karachi Phone No 5660062.
Mr. Muhammad Feisal (Senior Manager, Marketing) AKUH Karachi Phone No 4930051 Ext 2692
Ms. Aisha Arslan (Senior Marketing Executive) AKUH Karachi Phone No 4930051 Ext 4621
WWW.unileverpakistan.com.pk
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