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Rural marketing case study-Product strategyPresented by
Deepak.RP2MBA 13022
Amrita School of Business, Amritapuri
Started in 1983 by C.K Ranganathan
Based in Chennai- distinct player in shampoo market
170 crore products player ( 2000)
“Cavin” the word denotes beauty & fairness in Tamil
29-11-2014 2Amrita School of Business,Amritapuri
Shampoo Market
CavinKare Shampoo business has grown 34 % in 2000 , faster than the
overall market
The current size of shampoo market according to ORG-MARG is Rs. 850
crore, equivalent to 30,000 tonnes in vol. Unit
The present penetration is only – 18%
Market share Company Market share
CavinKare 19.8%
HLL 65%
P&G and others 45.2 29-11-2014 3Amrita School of Business,Amritapuri
Aim of the company
Achieve Rs.5000 turnover in the next 10years!!
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National level
Competitors
National level productsRegional players
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Entry barriers to new entrants
New entrants are discouraged by formidable task of establishing a
distribution channel from scratch.
HLL’s long established ties with retailers and extensive distribution reach
act as a entry barrier.
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Major barriers to shampoo use
1. Shampoo contains harsh chemicals
2. Glamour product rather than a hygiene product
3. The high price
29-11-2014 8Amrita School of Business,Amritapuri
Success routes of
While other products are at 2 Rs.
Introduced sachet at 50 paisa
Brand expanded 40% after this
Trimmed HLL’s volume share by 2-3%
Smaller sachet of Chik @ 1 Rs.
Scaled down versions of its brands
Rural market is the key driver for sachets ,which makes up to 70 % of total shampoo sale !! HLL has the highest market
share at rural market of 80%
29-11-2014 9Amrita School of Business,Amritapuri
Success routes of
Introduced - Herbal shampoo Nyle
Was one of the earlier entrants in Indian
herbal shampoo market
One among top 5 herbal shampoo brands in
the country
Accounts for 10% of market size
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But ....
HLL came up with LUX shampoo at 50 paisa
Bubbled packet of 30ml clinic plus
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Distribution of
CavinKare has 2,200 stockist , and have presence in 6 lakhs out lets
including Kiranas in small villages
Company has been concentrating on few pockets in south and North class
1 and 2 town
Company is trying to improve its distribution in metros in one hand and
rural in other hand.
Company has decided to strengthen its distribution structure by using
**SAP R/3 package
Has also undertaken special rural drive with exclusive stockist for rural
29-11-2014 12Amrita School of Business,Amritapuri
Promotion of
As 50 % of the people in rural market do not have television CaviKare uses
“Video on wheels”
Sample distribution
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Ways to expand the shampoo market
• Bring the perception that shampoo is a not glamorous product
Example: antidandruff, oil clear
• Offer premium Product: offer more functional benefits , add-ons helps
to increase the price and position the brand as premium
• Moving across category barriers: Medicated anti dandruff shampoo by
Johnson and Johnson
29-11-2014 14Amrita School of Business,Amritapuri
Philosophy of Mr.Raghunathan
• It is not good enough to know how to play the game properly.
Sometimes a win is possible only is you change the rules of
the game!!
As a result of this philosophy
1. Low unit packs was introduced
2. Saffron and milk combination in Fare Ever
3. Brand extensions are research based- Incorporate new findings and re
launch the brand
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Corporate Strategy of
CavinKare will never venture in to marketing will only focus on brand
building, R&D , and distribution management, Company have 3 rd party
manufacturers.
CavinKare will never undertake to distribute products of other
manufacturer.
They will not let their products to be distributed by other people.
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1. In shampoo market crowded with varieties ,
how could CavinKare make its mark?
2. How can CavinKare gain larger share in
shampoo market in future?
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