Emyrose.docx

TABLE OF CONTENTS Table of Contents ................................................................................................ 2MARKEting Plan for Hindustan Unilever Limited:-Giants in FMCG1. Terms of reference: ................................................................................. 42. Executive Summary ....................................................................................... 53. Mission and vision: ......................................................................................... 63.1 Line of Business: ....................................................................................... 63.2 Target Market: .............................................................................................. 63.3 Technology Used: .......................................................................................... 74. External Marketing audit: ............................................................................... 84.1 Macro Business environment: ....................................................................... 84.2 MICRO Business environment: .................................................................... 115. Internal Marketing Audit: .............................................................................. 135.1 Operating Results: ...................................................................................... 135.2 Strategic Issues Analysis ............................................................................. 145.3 Marketing Mix effectiveness ........................................................................ 186. SWOT Analysis .............................................................................................. 217. Marketing ObjectiveRecommendations ......................................................237.1 Strategic thrust ........................................................................................... 237.2 Strategic Objectives ................................................................................... 248. Core Strategy .............................................................................................. 259. Marketing Mix Decisions or Recommendations ...........................................259.1 Product ........................................................................................................ 269.2 Price ............................................................................................................ 269.3 Place ........................................................................................................... 269.4 Promotions .................................................................................................. 2710. Budget ........................................................................................................ 282

11. Organisation, implementation and control................................................ 2912. Reflexive account ....................................................................................... 30Reference .......................................................................................................... 32Appendix A .................................................................................................... 33About Hindustan Unilever Limited ................................................................... 33Appendix B

.................................................................................................... 35Political/Legal: .......................................................................................... 35Economic: .................................................................................................... 36Ecological/Physical environment: ................................................................... 37Social/Cultural: .............................................................................................. 37 Technological: ............................................................................................... 37Corporate Responsibilities ............................................................................... 38Appendix C .................................................................................................... 39Competitor Analysis ....................................................................................... 39Appendix D .................................................................................................... 40Common segmentation variables for detergents of HUL ................................... 40Appendix E .................................................................................................... 44Distribution and Retail................................................................................... 44Appendix F .................................................................................................... 48Appendix G .................................................................................................... 58Appendix H .................................................................................................... 5915. AppendixB………………………………………………………………………………………………………………….3516. Appendix C…………………………………………………………………………………………………………………3817. Appendix D………………………………………………………………………………………………………………...403

18. AppendixE………………………………………………………………………………………………………………….4319. AppendixF………………………………………………………………………………………………………………….4720. AppendixG………………………………………………………………………………………………………………….5721. AppendixH…………………………………………………………………………………………………………………58 MARKETING PLAN FOR HINDUSTAN UNILEVER LIMITED:-GIANTS IN FMCG1. TERMS OF REFERENCE: 4

Hindustan Unilever Limited (HUL) is India's largest fast moving consumer goodscompany, with leadership in Home & Personal Care Products and Foods & Beverages.HUL's brands, spread across 20 distinct consumer categories, touch the lives of two out of three Indians.

(Refer Appendix A). The objective of this marketing plan is to provide a detailed formulation of thenecessary actions to carry out the marketing program. The marketing plan shall highlightone of HUL’s strategic business units (SBU), its market share, competitors in that particular segment, SWOT analysis, overview of external and internal marketing audit, application of marketing mix and key strategic issues, recommendations, implementation of key strategiesand implications of these strategies on HUL’s market share. 2. EXECUTIVE SUMMARY This report examines Hindustan Unilever Limited with main focus on Detergent segmentwhich is a major revenue generating segment. HUL has been the market leader for manyyears in this segment. This report showcases macro and micro environment for HUL. Thereis a huge market for detergents in India. HUL with the brand name it has, should cash in onthe situation. A marketing plan has been developed keeping in mind current trends inconsumer buying patterns. The marketing plan has been drawn upon by considering thefeedback from consumers as well. The report consists of PESTL analysis, information onmarket segmentation, target market identification, competitor analysis, SWOT analysis, andcompetitive advantage and core competencies of HUL as a company. Marketing mixeffectiveness of detergent segment of HUL has been discussed to achieve overall marketingobjectivefor the sales of HUL detergents by targeting the right people and offering themwith the improved range of products. New ways of promotions have been suggested. The budget for the promotions has been arrived upon. Various channels have been chosen to promote the detergents. New product launch is been suggested keeping in mind thefeedback received from the respondents of the survey. 5

The marketing plan is developed by accessing the primary and secondary data. The prime objective of this report is to precisely analyze the current trends in detergent marketin India and develop a strategy for HUL to regain their sales volume share. Somerecommendations have been made to improve the way the products have to be promoted;there should be a monthly review by the management of HUL to access the situation. 3. MISSION AND VISION:

HUL’s vision is to continue to be an environmentally responsible organization makingcontinuous improvements in the management of the environmental impact of their Operations.HUL strives to “Add vitality to Life” Their corporate purpose states that to succeed requires "the highest standards of corporate behaviour towards everyone we work with, the communities we touch, andthe environment on which we have an impact."Source: HUL (2010). http://www.hul.co.in/ [Accessed 11/05/2010] 3.1 LINE OF BUSINESS: HUL is India's largest fast moving consumer goods company, with leadership in Home &Personal Care Products and Foods & Beverages. HUL's brands are spread across 20 distinctconsumer categories which touch the lives of two out of three Indians. 3.2 TARGET MARKET: As stated earlier, this write up will focus on a SBU of HUL.The SBU in purview is Detergents. The brands to be discussed are Surf Excel Quick Wash,Surf Excel Blue, Surf Excel Automatic, Rin Advance, and Wheel Regular. The targetmarket is women in India. Buying power is middle. It is a volume market hence customer is price sensitive. 6

Figure 3.1 Per Capita Consumption of Detergents (US $ )

Source:Euromonitor 2009Table 3.1 Segmentation of Detergent Powder MarketPremiumMidPricedMass Market Surf Automatic-Front LoadSurf Excel BlueWheel Regular Surf Automatic- Top LoadSurf Excel Quick WashRin AdvanceAriel TideNirmaAmway HenkoGhari Source: Created by Sharath Shyamasunder (2010) 3.3 TECHNOLOGY USED:

In India, laundry detergent Surf Excel is used mostly for hand washing. When washingclothes by hand, it’s rinsing that often takes most time and uses most water. Understanding the problem 7

Surf Excel is improved so that less rinsing is needed, while still getting clothes as clean as before. People keep rinsing in water till the lather is gone completely, so to cut the number of rinses by adding one of a number of anti-foam ingredients commonly used in machine-washing detergents. That would make the lather rinse more quickly. But Surf Excel Quick Wash can deliver a good lather at the washing stage, and reduce the need for the rinsing – saving two bucketfuls of water per wash. Source: How Surf excel works? (2010)http://surfexcel.in/Product-Range/Surf-ExcelQuickwash.aspx[Accessed 25/05/2010] 4. EXTERNAL MARKETING AUDIT: Marketing audit according to (Jobber, 2010) is “A systematic examination of a business’smarketing environment, objectives, strategies and activities. External Marketing Audit is concerned with those factors over which the organizationhas no control. It can be classified into Macro environment and Microenvironment. Source:

Jobber.D (2010) Principles and Practice of Marketing. McGraw-Hilleducation 4.1 MACRO BUSINESS ENVIRONMENT: Table 4.1 PESTL Analysis 8

Political/Legal: Indian government’s policies of lifting of the quantitative restrictions,reduction in excise duties andautomatic foreign investment hasfostered HUL’s growth.Removal of the regulatoryframework has allowed HUL toexplore every product and segment,without constraints on productioncapacity. Center for Monitoring IndianEconomy (2010).http://www.cmie.com/ [Accessed12/05/2010]Economic: Detergents segment of HUL has about 36%market share in that segment (FY 08-09). Thissegment accounts for at least 40% of the totalrevenue. HUL’s market share in detergentssegment has declined in the last two years, due toheavy competition.An increase is spending pattern has beenwitnessed in Indian FMCG market especially inthe detergent market. Center for Monitoring Indian Economy(2010). http://www.cmie.com/ [Accessed12/05/2010]Financial Times (2010)http://www.ft.com/ [Accessed on 13/05/2010] 9

Ecological/Physical environment: HUL has contributed significantly insaving water through technology.Educating people on Rain water harvesting, soil conservation andreduction of greenhouse gases. A carbon reduction supply-chain project has enabled (HUL) to beawarded carbon credits. (Refer Appendix C for informationon Corporate socialresponsibilities)Annual report 2008-09 HUL.http://www.hul.co.in/ [Accessed13/05/2010]Social/Cultural: The size of the detergent market in India isestimated to at Rs.12, 000 Crores. Detergentsegment is characterized by high degree of competition and high level of penetration. Withrapid urbanization in India, emergence of small pack size and sachets, the demand for thedetergents is flourishing. With the use of hardwater for washing and scarcity of water it isimperative that HUL produces products that suitthe water type in India. Technological:

HUL has research centers in Bangalore and Mumbai which has more than 200 scientistsand technologists. Addressing the washing needs of consumers is a key challenge for thelaundry Research group. How to minimize water usage while washing? How to impartstain repellent treatment to garments? These are the questions which have been answered by HUL R&D team. Research and Development 2010 HUL.http://www.hul.co.in/careersredesign/carreerschoices/researchanddevelopment/[accessed 13/05/2010](Refer Appendix B for more information on Macro Environment) 10

4.2 MICRO BUSINESS ENVIRONMENT: Microenvironment as according to (Jobber, 2010) consists of factors in the firm’simmediate environment which affects its capabilities to operate effectively.The useful framework that can be utilized when undertaking this analysis is Porter’s ‘Fiveforces’ model. This analysis is carried out at the level of Detergent SBU of HUL. Figure 4.1 The Five Forces model (Source: Adapted from Porter 1980)Suppliers: HUL has a very strong supplier base. Supplier power is considerable in case of detergentsegment of HUL as there is a lot of costing involved when switching suppliers. As HUL provides a large amount of its business to the suppliers, these suppliers are beholden toHUL. As said earlier, the supply power is limited. Potential Entrants: 11 SuppliersCompetitive RivalryPotentialEntrantsBuyersSubstitutes

Given the capital investment required to enter the detergent market in India, with the pricing of the products being very low, threat of potential entrants is low. With a lot of local brands in the market and names like Nirma, P&G, the detergent market has becomeextremely

competitive and crowded. For the new entrant to position its products on theshelves of retailers alongside Surf Excel, Rin, Henko and Rin would be a real challenge. Buyers: Buying power of retailers of HUL when it comes to detergent market is very high as theyare able to negotiate on price. Buying power of consumers is low as the consumers arefragmented and they do not have a great influence on the price as well as the product.Buyer loyalty is considerably less when it comes to Mass market detergents, as theconsumers of that segment are price sensitive. Consumers in the premium and mid pricedsegment are very loyal to the brand. Substitutes: There is a strong threat from substitutes from the local market especially in the ruralmarket. Even though within the detergent market, brand succeeds in building up acompetitive market the threats from substitutes are high such that the pricing power of HUL brands are eroded. Government regulations for local brands are very conducive to set up the business in India.For e.g. Local detergent brands like Ghari, RMC, etc. Competitive Rivalry: Consumers of detergents have enormous amount of choices. The brand loyalty in detergentsegment is very poor. Price wars among competitors of HUL like P&G, Nirma is fierce .(Refer Appendix C). The competitive rivalry in the detergent segment is very high. Pricewars are regular affairs which is beneficial from a customer perspective. Due to this thecompanies are forced to bring down their operational costs to survive in this hostileatmosphere. Figure 4.2: Indian Detergent Market 12

Source: Russel Davis, Nirma 2007-08. 5. INTERNAL MARKETING AUDIT: Internal Marketing Audit is concerned with those factors over which the organization hascontrol.

Source: Jobber.D (2010) Principles and Practice of Marketing. McGraw-Hilleducation 5.1 OPERATING RESULTS: HUL is India's largest Fast Moving Consumer Goods Company, touching the lives of twoout of three Indians . Detergent segment in HUL accounts for 48% of the totalturnover.15, 28,391 tonnes of synthetic detergents were sold by HUL during January2008- March 2009.The total sales value of detergents according to the annual report of HUL is 4908.46 Cr INR. Market share of HUL detergents is 36% as per annual reportof HUL 2009.Figure 5.1 Sales value of various divisions of HUL from the period of Jan-08 to Mar-09. 13

Source:

Annual report 2008-09 HUL. http://www.hul.co.in/ [Accessed on 1305/2010]Figure 5.2 Share value of HULSource:

http://money.rediff.com/companies/hindustan-unilever-ltd/12520002 [Accessed on 01/07/2010] 5.2 STRATEGIC ISSUES ANALYSIS 14

HUL’s current marketing objective is to improve the market share, which has gone down inthe last two years through high marketing spend and bringing down the packaging cost of detergents. 4.2.1 Marketing segmentation

Marketing segmentation as stated by (Ferrell, O.C and Hartline, D. 2007) is the process of dividing the total market for a particular product or product category into relativelyhomogenous segments.In the discussion that follows, we look more closely at segmentation in detergent markets by examining the different factors that can be used to divide the market. As table 4.1illustrates, these factors fall into one of these categories: Behavioral segmentation,Demographic segmentation, Psychographic segmentation and Geographic segmentation. (Refer Appendix D)Table 5.1 Common segmentation variables used in Consumer markets.CategoryVariablesExamples 15

Behavioral segmentation Benefits soughtQuality, Value, Convenience,Product usageHeavy , Medium and Light, Non usersOccasions /SituationsDaily usePrice sensitivePrice sensitive, Valueconscious, Status conscious Demographicsegmentation Age18-60GenderMale/FemaleIncomeLow income, Mid income,High incomeOccupationWhite collared, technical,Professional, Managers,Laborers, Homemakers,Retired, UnemployedEducationHigh school, Collegegraduate, GraduateSocial classUpper class, Middle class,Lower class, Poverty levelGenerationGeneration Y,X Baby boomers, Laggards Psychographicsegmentation PersonalityOutgoing, Shy, Materialistic,Anxious, Civic minded,VenturesomeLifestyleOutdoor Enthusiast, Homely,Workaholic, Family centeredMotivesCleaning Geographicsegmentation RegionalNorth, South, East, WestPopulationUrban, Sub urban ,Rural Source: Hartline, D and Ferrell, O.C (2007) Marketing Strategy. Thomson South-Western5.2.2 Competitive Advantage: 16

HUL’s Competitive advantage lies in its strong and efficient distribution network. Itsculture to continuously innovate for product betterment keeps them ahead of competition.Their high markets spend that enables their products gets a greater reach. HUL operates atzero working capital. The key is constant efforts to reduce capital investments byoutsourcing manufacturing, streamlining supply chains and paying close attention todistributor’s performance*. Developing new channels like Rural marketing (for eg. ShakthiAmmas) and direct selling. Most importantly their products are low priced and good valuefor money and strong commitment towards improving the community. (For furtherinformation refer Appendix E). * Prahalad, C.K and Hammond, A, (2002) Serving the World’s poor, Profitability,Harvard Business review.5.2.3 Core competencies HUL has a wide range of quality products designed to meet the needs of the consumers. Ithas country wide reputation and presence. All their detergents are conservatively priced.They have an innovative style and low cost packaging. HUL has an excellent distributionnetwork which enables greater reach. Their main focus on providing value to customersthrough continuous product innovation and to be known as socially responsible company.HUL has a very good brand name in the market which they have used to their advantage tomaintain their market share. 5.2.4 Product Life cycleFigure 5.3 Product life cycle of HUL 17

Source: Created by Sharath Shyamasunder (2010) HUL detergents are in between the growth and maturity stage. The marketing mix elementshave been planned keeping the product life cycle in mind. Detergent features should besuch that it is differentiated from the rest of the competition. Pricing should be lower because of intense competition. The distribution channels needs to be very effective withinvestment on IT, so as to increase the efficiency. Promotions are aimed at a larger targetaudience with focus on product differentiation. With right promotions in the right place,HUL can reap the benefits.

5.3 MARKETING MIX EFFECTIVENESS 5.3.1 Product: Current products offered by HUL (Detergent segment) are Surf Excel Automaticexclusively for washing machines, Surf Excel Blue, Rin Advance, and Wheel Regular. Table 5.2 Segmentation of detergents offered by HUL 18

PremiumMid-PricedMass Market Surf Automatic-Front LoadSurf Excel BlueWheel Regular Surf Automatic- Top LoadSurf Excel Quick WashRin AdvanceProducts are designed keeping in mind the nature of water in India and the scarcityof it. New technology wherein less water is consumed while washing clothes makes HUL products fare better. Detergents have micro granules which can penetrate into the fabriceasily and remove the dirt and stains easily. They are available in small sachets also.Currently a lot of promotions are splashed in the media to educate the audience about the products. 5.3.3Place HUL products are made easily available through the efficient distribution system. Thedetergents are available in the Local grocery stores, Super markets and there is a door todoor sale. (Refer Appendix E) Figure 5.4 Segmentation of detergents offered by HUL5.3.2 Pricing The following are the prices of few detergents in India. 19

Table 5.3 Prices of detergents in rupeesDetergent Brands500 gm1 kg2 kgSurf Excel Quick wash 70130260

Surf ExcelAutomatic 82164320 Rin Advanced 2855125 Wheel Regular 203872 Tide Naturals 35 70135 Nirma 45 87 165 Henko 4890169 Ariel 78152300 Source: Created by Sharath Shyamasunder (2010)5.3.4PromotionsTable 5.4 Various channels through which HUL promotes its detergentsPrint MediaHUL advertises in leadingdailies like Times of India and Indian expresswhich has a wide reach. TelevisionAdvertisements of Detergents are aired in prime time to getthe attention of women. Demo campaignsDemo campaigns are doneregularly with sales people going to householdand give a demo to the consumers so that theconsumers can have a firsthand experienceand they believe what they see. Hoardings-

Hoarding advertisementsare done usually during a new productlaunch or a reduction in price. For e.g.when the prices of Surf excel was cut by5%, huge hoardings were put in prominent places across all cities. Live showsTV shows like “Wheel Shrimati”which is aired in prime time on Nationalchannel, the target audience being women waswell received. RadioRadio Jingles are aired which promote detergents. InternetOnline promotions are conductedregularly on respective detergents websites. Rural MarketingRural campaignssuch as “Shakthi Amma” have enabledHUL to get such deep penetration intothe rural market. 20

6. SWOT ANALYSIS SWOT analysis as stated by (Baker, 1995) is “a summary of the audit under the headings of internal strengths and weaknesses as they relate to external opportunities and threats”. Figure 6.1 SWOT analysisStrengths ? Presence of established distributionnetworks in both urban and ruralareas ? Attractive packaging and availablein small quantities ? High brand value

? High spend on product innovation Weakness ? Focus on building a power brand so priced higher than others andneglecting other brands ? Gave unwanted publicity to Tide inthe ad war between Rin and Tide ? Sticking to old strategies for longtime Opportunities ? Large Consumer base ? Forecast of Detergent market togrow in India ? Per capita consumption is High ? High consumer goods spending Threats ? Emergence of Rural brands whichare cheaper ? Imitation or Me-Too versions of detergents ?

Price reduction by competitors Strengths: One of the major strengths of HUL is its distribution network, which has foot print even inthe rural areas. Their reach makes them the market leader in FMCG. The brand value of HUL products is very high so its keeps them ahead of competition. The need for product 21

improvement and innovation is the main agenda of HUL which augurs well for the future.HUL has been continuously able to grow at a rate more than growth rate for FMCG Sector,thereby reaffirming its future stronghold in Indian market. Weakness: HUL’s extensive reach and country wide presence enabled them to rise the prices of thedetergents even though the raw material prices were decreasing. This has allowed HUL togain more profits but the volume came down, this allowed a lot of competitors to grow.HUL was backing its power brands with an idea to earn high revenues.HUL's weaknesswas its inability to transform its strategies at the right time. They continued with the sameold strategy which helped HUL gain profits but was not genuine in this changingenvironment. The competition has put HUL on the defensive mode. Opportunities: HUL has a large customer base; people who do not use HUL’s detergents but use other HUL products can be influenced to use HUL detergents. According to the forecasting donethe detergent market is expected to grow by double digit. The per capita consumption of detergents in India is pretty high. The buying patterns of consumers for detergent segmenthave been changing which again augurs well for HUL. Threats: Strong backing of Power brands by HUL and the continuation of old strategy which helpedHUL to gain in revenues created opportunities for its competitors to grow. This situationcreated avenues for Local detergent manufacturers to enter the market with cheapdetergents. Lot of imitation or me-too products gained popularity at the expense of HUL.Government regulations have been relaxed which has helped the rural players to set up their business and they now

pose a threat to HUL. The price war among HUL and itscompetitors has intensified and this has made HUL to cut down the prices of detergents.The market share and the sales volume has been affected due to the entry of local players. 22

7. MARKETING OBJECTIVE-RECOMMENDATIONS For the Marketing objective to be set, we shall consider Strategic Thrust and strategicObjective. The planning phase of strategic marketing phase consists of (1) SituationAnalysis (2) Market product focus and goal setting (3) Marketing program. Figure 7.1 the strategic marketing processMarketing planResultsControl PhaseSource: Kerin, A. R et al (2008) Marketing the Core, McGraw Hill-Irwin 7.1 STRATEGIC THRUST 23 Market focus and Goalsetting Set market and product goalsSelect target marketsPosition the product Marketing program Develop the marketing mixDevelop the budget, by estimatingthe revenues, expenses and profits

Implementation phase Obtain resourcesDesign marketing organizationDevelop schedulesExecute marketing Program Control phase Compare results with plans to identify deviationsAct to correct negative deviations; exploit positive ones SWOT Identify industry standardsAnalyze competitionLook for potential Markets

Strategic thrust defines which products to sell in which markets.HUL will go for existing product in the existing markets as they are doing well. There has to be a reduction in the prices as there is stiff competition. They can diversify their product range into liquiddetergent, and then HUL will have a complete range of products for fabric care. Figure 7.2 Ansoff MatrixPRODUCTS M A R K E T S

ExistingNew E x i s t i n g Market PenetrationNew Product Development Quality products for WashingmachinesDesign detergents specially for woollenclothesRecution in PricesDesign detergents specially for color clothingCustomer focusDevelop an Instawhitening system N e w Market DevelopmentDiversification Develop a market in Liquiddetergent segmentDiversify the products into liquid detergentsegmentConduct demonstrations toobserve the needs of Customer and educate them on the products Created by Sharath Shyamasunder (2010) 7.2 STRATEGIC OBJECTIVES Figure 7.3 Strategic objectives for HUL detergent division Build Invest of new product development like Hold 24

Liquid detergentsInvest on product innovationSelective investment on new methods of packaging Harvest HUL has traditionally followed theHarvest method, wherein moreemphasis was on maximizing profitmargins, sales and market share wasallowed to fall Divest Non performing brands such as Breezeis dropped from the Indian market 8. CORE STRATEGY Competitors of HUL in detergent segment are P&G, Nirma, Ghari, 555 etc. HUL initiallyhad a strategy of increasing profit margins so the detergents were priced high whencompared to the competition. The sales volume and the market share were affected due tothis. The strategy now employed by HUL is that the detergents are priced on par with thecompetition and the advertisement expense has been increased by 66% when compared to2008.HUL is targeting its competitor’s brands and is engaged in a price war to gain themarket share. For e.g 30% cut in the price of Rin as Wheel had reduced the price. The Adwars between Surf Excel and Tide, where HUL compared the two brands in terms of thecontent and the effectiveness.The competitive advantage which HUL has over its competitors is that they have anexcellent distribution network. They have the brand name which has a country wide presence. Their penetration in rural areas cannot be matched by its competitors. Their continuous spend on R & D will help to build their product portfolio. The image that HULas a socially responsible company goes down well with the public. 9. MARKETING MIX DECISIONS ORRECOMMENDATIONS 25

9.1 PRODUCT HUL can go with their existing range of detergents are they are doing well in termsof sales volumes. Their market share although has decreased, with the reduction in prices.An effort is

there to get the production cost down by having pared down the color paletteused for printing across many products. The system has been used to reduce printed packaging costs. Some non performing brands like Breeze should be shelved out.According to the survey results (Refer Appendix F) Surf excel is the most widelyused detergent in its segment. The need to have a good fragrance in the detergents isemphasized. An Insta- whitener and liquid detergent market can be entered as per thefeedback got from the survey. 9.2 PRICE The prices of all the detergents of HUL have been reduced considerably to competewith the competitors. For e.g. 30% Price reduction in Rin and 20% price reduction in Surf excel they hope to get back that market share. If the production cost is reduced then the price of the detergents will come down. An effort to reduce the cost has to be a top priority.“Zero inventory” and “Go to the market” initiative to reduce cost and increaseefficiency. (More information in Appendix G)Source: Sangani, P. Economic Times (2009), The Zero Effect Pg no 3.Available at www. hul .co.in/mediacentre/MediaCoverage/ [Accessed on 15/05/2010] 9.3 PLACE The distribution network of HUL is one of the best in this industry. Efforts must be taken touse technology like SAP which help in managing the distribution effectively. Some of the benefits of SAP are 26

• Streamlined business operations • Improved information sharing with partners even if they are not using SAP’ssolutions

• Increased supply chain efficiency through process-centric collaboration across theEnterprise— internally and externally • Enhanced value of legacy system Source: Success stories of SAPwww.sap.com/india/about/company/successes/pdfs/ HUL .pdf [Accessed on 20/05/2010(More Information in Appendix H) Introduction of Exclusive shelves of HUL products in Supermarkets wherein only HUL products are displayed together. This will enhance the shopping experience of the consumer and there will be no conflicts of brands. 9.4 PROMOTIONS Great advertising is inspired by insights about brands, consumers, and how the two interact.It starts with a problem from the client and ends with a solution to the customers.As seen from the survey, many people do not identify HUL products and are notaware of the features of specific products, so an effort to educate the customer through promotions must be taken. Creativity defined Creative ads make a relevant connection between the brand and its target audience and present a selling idea in an unexpected way. Creative ads present a selling idea. Media 27

When and where a message runs can be as creative as the words and visuals. Everydayitems have become media vehicles. HUL can promote its line of detergents on dresshangers in trains and buses frequented by women. The hangers can come with a message“Want your dress to be bright and clean use Surf Excel/ Rin/ Wheel”*. Source: Jeweler. A and Drewniany .L (2008) Creative strategy in Advertising. LynUhl 10. BUDGET

Figure 10.1 Promotional activities to be undertaken by HUL to regain market sharePromotionalactivitiesDescriptionBudget inLakhs(INR)% of totalBudget forPromotions 28

Television Advertisements in channels like Star and Zee TV between 7.PM and10.PM to reach the women who arethe target audience8945035 Newspapers Advertisement and promotions inmajor dailies like Times of India andIndian Express as they carry outexclusive sections for women3835615 Mass mediacampaigns andcreative ads “Daag accha hai” type of campaignswhich catch the eye of the viewer and the hanger promotion*2557010 TV showssponsorship Sponsoring TV shows where womenare the main focus3835615 Radio Radio jingles should be aired whichshould have catchy phrases127855 Internet Till date Internet marketing or Internet sales of detergents have not been implemented in a big way, if HUL can do it they can have a earlyentrant advantage127855 Demonstrations Demonstrations in supermarketswith some contests and offers should be carried out regularly.3835615According to annual report of HUL 2009, the budget for sales promotion for theyear 2009-10 would be 2,55,658 lakhs INR. I would recommend the amount to spend asshown in the table. Source: Annual report 2008-09 HUL. http://www.hul.co.in/ [Accessed 13/05/2010]

11. ORGANISATION, IMPLEMENTATION AND CONTROL The changing environment, the fierce competition faced by HUL in the detergentsegment calls for a marketing plan with a long term vision and in accordance with thecompany’s objectives. The marketing plan formulated above is of such nature and needs the 29

support of the management. The marketing team of HUL has to take full responsibility of implementing the marketing plan with the support of the management. The managementshould define the roles of people involved in carrying out the marketing plan. The budgetneeds to be allocated for the promotional activities and the marketing team should beaccountable for the utilization of the funds. Reviews by the management should be anintegral part of the implementation process.Control is required to take corrective actions from the feedback received from themarket. Reviews by the management should happen regularly regarding the sales growth,expenses, R & D, feedback from the customers. The progress of the marketing plan should be closely monitored by the Business Manager of the detergent department. 12. REFLEXIVE ACCOUNT The reason for choosing Hindustan Unilever Limited for this report is because of the fact that HUL touches almost every Indian’s life. I, myself have used most of the products of HUL and I am a very satisfied and a loyal customer of HUL products.Moreover the market for FMCG in India is set to grow in the years to come. HUL being the brand it is should take stock of the situation and prepare for the growth. Working on thisreport has been very enriching for me in terms of knowledge, and I have derived immense pleasure in researching on HUL. The response for my questionnaire was very encouragingand HUL products have got an excellent feedback. Problematic Areas in Research HUL is such a big brand that it is one of the most discussed companies inManagement studies, so when I started researching about HUL, i was a little skeptical aboutchoosing HUL. But later I realized I could contribute a new perspective to the HULmarketing plan. Although the response to the survey was encouraging, it took constantfollow ups with the respondents. Compiling the responses was very time consuming and atedious process. The reason that I started early on

the project helped me, as i never faced atime crunch. Since HUL is a listed company in India and is one of the most discussedcompany, huge chunks of data was available on the internet like the annual reports, 30

newspaper articles, Case studies. To go through them, understand the write ups and precisely use the information in the report was a very challenging task. What went right? As stated earlier since HUL is a listed company in India getting relevant data likeAnnual reports very relatively easier, compiling these data and arriving at PESTL analysiswas easier. By speaking to few friends who work for HUL in different departments andunderstanding the work culture, marketing initiatives was very useful experience and thishas helped me to present certain facsssts with more depth. Based on the product life cycleand the macro and micro environments the marketing mix decisions and SWOT has beenderived. Role of Marketer Being in a Sales and marketing position for over two years has helped me visualizethe plan with relative ease. Since marketing is the most important aspect of business as ithas a direct impact on the company’s profitability and sales, role of the marketer is verychallenging. It requires constant interaction with customers as well people within theorganization. Collecting the information from the customers and compiling the data in away most suitable for the people concerned in the organization for e.g. R&D department isa vital function of a marketer.One of the things which have changed over the years is the perception of people thata company is not just a seller of products but also have responsibility to be more sociallyresponsible.Being socially responsible means an organization shows concern for the peopleand environment in which it transacts business. It also means that these values arecommunicated and enforced by everyone in the organization. In addition to insuring thesevalues exist within the organization and its business partners, social responsibility may alsomanifest itself in the support of social causes that help society. For instance, marketers maysponsor charity events or produce causerelated advertising.Marketers who are pursuing a socially responsible agenda should bear in mind thatsuch efforts do not automatically translate into increased revenue or even an improved 31

public image. However, organizations that consistently exhibit socially responsibletendencies may eventually gain a strong reputation that could pay dividends in the form of increased customer loyalty. Source: Social responsibility in Marketing (2010)http://www.knowthis.com/principles-ofmarketing-tutorials/what-is-marketing/social-responsibility-in-marketing/[Accessed on 13/06/2010] REFERENCE • Drummond, G and Ensor, J (2005) Marketing Concepts. Butterworth-HeinemannLtd • Hartline, D and Ferrell, O.C (2007) Marketing Strategy. Thomson South-Western • Jeweler. A and Drewniany .L (2008) Creative strategy in Advertising. Lyn • Jobber David (2010) Principles and Practice of Marketing. McGraw-Hill education • Kerin A.Roger et al (2008) Marketing the Core. McGraw Hill-Irwin 32

• Michael J. Baker (1995) the Marketing Book. Butterworth-Heinemann Ltd • Porter, M.E. (1980) Competitive Strategy. The Free Press, p.4. •

Prahalad, C.K and Hammond, A, (2002) Serving the World’s poor, Profitability.Harvard Business review. • Sangani, P. Economic Times (2009), The Zero Effect Pg no 3. Journals • Journal-Source: Anandan, C. (2007) A Study on Brand Preferences of WashingSoaps in Rural Areas, vol. 37,pp.3 Websites • HUL (2010).http://www.hul.co.in/ • How Surf excel works? (2010)http://surfexcel.in/Product-Range/Surf-Excel-Quickwash.aspx • Center for Monitoring Indian Economy (2010).http://www.cmie.com/ • Success stories of SAPwww.sap.com/india/about/company/successes/pdfs/ HUL .pdf • Social responsibility in Marketing (2010)http://www.knowthis.com/principles-of-marketingtutorials/what-is-marketing/social-responsibility-in-marketing/ APPENDIX AABOUT HINDUSTAN UNILEVER LIMITED 33

Hindustan Unilever Limited (HUL) is India's largest fast moving consumer goodscompany, with leadership in Home & Personal Care Products and Foods & Beverages.HUL's brands, spread

across 20 distinct consumer categories, touch the lives of two out of three Indians. They endow the company with a scale of combined volumes of about 4million tonnes and sales of Rs.13, 913 crores.The mission that inspires HUL's over 15,000 employees is to "add vitality to life". With 35Power Brands, HUL meets every day needs for nutrition, hygiene, and personal care with brands that help people feel good, look good and get more out of life. It is a mission HULshares with its parent company, Unilever, which holds 52.10% of the equity. A Fortune 500transnational, Unilever sells Foods and Home and Personal Care brands in about 100countries worldwide.CEO: Mr.Nitin ParanjpeGroup Turnover of 13913.4028 Cr. And profit of INR 1914.8897 Cr.Average Market Capitalization for the last 4 years is INR 56000 Cr.Soap & Detergent Division contributes INR 6374.5265 Cr. OVER 100 YEARS LINK WITH INDIAYEAR MILESTONES1888 Sunlight soap introduced in India. 1895 Lifebuoy soap launched; Lever Brothers appoints agents in Mumbai, Chennai,Kolkata, and Karachi. 1902 Pears soap introduced in India. 1905 Lux flakes introduced. 1914 Vinolia soap launched in India. 1922 Rinso soap powder introduced. 1937 Mr. Prakash Tandon, one of the first Indian covenanted managers, joins HVM.65% of managers are Indians. 34

1956 Three companies merge to form Hindustan Unilever Limited, with 10% Indian equity participation. 1958 Research Unit starts functioning at Mumbai Factory. 1959 Surf launched. 1961 Mr. Prakash Tandon takes over as the first Indian Chairman; 191 of the 205 managersare Indians. 1967 Hindustan Unilever Research Centre, opens in Mumbai. 1969 Rin bar launched; Fine Chemicals Unit starts production; Bru coffee launched 1977 Jammu synthetic Detergents plant inaugurated; Indian shareholding increases to18.57%. 1982 Government allows 51% Unilever shareholding. 1991 Surf Ultra detergent launched. 1995 HUL and Indian cosmetics major, Lakme Ltd., form 50:50 joint venture- LakmeLever

Ltd.; HUL enters branded staples business with salt; HUL recognised as Super Star Trading

House. 1997 Unilever sets up International Research Laboratory in Bangalore; new RegionalInnovation Centres also come up. 2005 Launch of "Pureit" water purifiers 2007 Company name formally changed to Hindustan Unilever Limited after receiving theapproval of share holders during the 74th AGM on 18 May 2007Sales of Brooke Bond and Surf Excel each cross the Rs 1,000 crore mark 2008 HUL completes 75 years on 17th October 2008. Source: Annual report 2008-09 HUL. http://www.hul.co.in/ [Accessed 13/05/2010] APPENDIX BPOLITICAL/LEGAL: 35

Indian Government has enacted policies aimed at attaining international competitivenessthrough lifting of the quantitative restrictions, reducing excise duties, automatic foreigninvestment and food laws resulting in an environment that fosters growth in the FMCGsegment. This initiative has helped HUL in a big way to get a lot of foreign brands into thecountry. The consumers are in a position to use and appreciate HUL products at anattractive price. The liberalisation of the Indian economy, started in 1991, clearly markedan inflexion in HUL's and the Group's growth curve. Removal of the regulatory framework allowed the company to explore every single product and opportunity segment, without anyconstraints on production capacity. Source: Center for Monitoring Indian Economy (2010). http://www.cmie.com/[Accessed 12/05/2010] ECONOMIC:

HUL is the India’s largest FMCG player. It creates employment for more than 18 thousand people. Its principal constituents are Household Care, Personal Care and Food &Beverages. Detergents segment of HUL has about 36% market share in that segment (FY08-09). This segment accounts for at least 40% of the total revenue. HUL’s market share indetergents segment has declined in the last two years, due to heavy competition on the pricefront from other players like P&G, Nirma, Ghari and other local players. But the positive isthat the volumes grew by 4% in the last quarter. An increase is spending pattern has beenwitnessed in Indian FMCG market especially the detergent market. There is an upwardtrend in urban as well as rural market. An increase in disposable income, of householdmainly because of increase in nuclear family where both the husband and wife are earning,has lead to growth rate in FMCG goods. Source: Center for Monitoring Indian Economy (2010). http://www.cmie.com/[Accessed 12/05/2010]Financial Times (2010)http://www.ft.com/[Accessed on 13/05/2010] 36

ECOLOGICAL/PHYSICAL ENVIRONMENT: HUL’s significant contribution in saving water through technology is highly appreciated bythe Government of India. HUL is striving hard to educate people on aspects of reduction of greenhouse gases. Serving the communities has been integral to HUL’s business conduct.Rainwater harvesting and soil conservation projects around their factories have madesignificant impact in these regions. HUL has planned to come up with biodegradablecovers for their detergent brands. HUL is working to promote environmental care, increaseunderstanding of environmental issues and disseminate good practice. A carbon reductionsupply-chain project has enabled Hindustan Unilever Limited (HUL) to become the firstUnilever business worldwide to be awarded carbon credits under the Clean DevelopmentMechanism (CDM) scheme. Source: Annual report 2008 HUL. http://www.hul.co.in/ [Accessed 13/05/2010] SOCIAL/CULTURAL: The size of the detergent market in India is estimated to at Rs.12, 000Crores. Detergent segment is characterized by high degree of competitionand high level of penetration. With rapid urbanization in India, emergenceof small pack size and sachets, the demand for the detergents isflourishing.HUL has a major share in this market.

TECHNOLOGICAL: HUL has research centers in Bangalore and Mumbai which has more than 200 scientistsand technologists.

HUL R&D is the hub for the best minds. Addressing the washing needsof consumers is a key challenge for the laundry Research group. How to minimize water usage while washing? How to impart stain repellent treatment to garments? These are thequestions which have been answered by HUL R&D team. By adding one of a number of anti-foam ingredients commonly used in machine-washing detergents, lather is reducedwhile rinsing the clothes thus reducing the water consumption by 50%.HUL detergents 37

penetrate deep down into fabrics and removes dirt. HUL has separate detergents for TOPloading and FRONT loading washing machines keeping in mind the washing patterns of both the machines. Source: Research and Development 2010 HUL.http://www.hul.co.in/careersredesign/carreerschoices/researchanddevelopment/[accessed 13/05/2010] CORPORATE RESPONSIBILITIES The Board and the Management Committee of HUL is committed to conduct the companyoperations in an environmentally sound manner. The Management Committee will: • Set mandatory standards and establish environmental improvement objectives andtargets for HUL as a whole and for individual units, and ensure these are included inthe annual operating plans. • Formally review environment performance of the company once every quarter. •

Review environment performance when visiting units and recognise exemplary performance. Nominate:The Management Committee, through the nominated environmental coordinator will: • Ensure implementation of HUL Policy on environment and compliance withUnilever and HUL environmental standards and the standards stipulated under relevant national / local legislation. When believed to be appropriate, apply morestringent criteria than those required by law. • Assess environmental impact of HUL operations and establish strategies for soundenvironment management and key implementation steps. • Encourage development of inherently safer and cleaner manufacturing processes tofurther raise the standards of environment performance. 38

• Establish appropriate management systems for environment management andensure regular auditing to verify compliance. • Establish systems for appropriate training in implementation of EnvironmentManagement Systems at work. • Ensure that all employees are made aware of individual and collectiveresponsibilities towards environment. • Arrange for expert advice on all aspects of environment management.

• Participate, wherever possible, with appropriate industry and Government bodiesadvising on environmental legislation and interact with national and localauthorities concerned with protection of environment.Source: Making a difference 2010 HUL.http://www.hul.co.in/sustainability/MakingaDifference/[Accessed21/05/2010] APPENDIX CCOMPETITOR ANALYSIS DescriptionHULP&GNirma 39

Strengths Strong distributionnetwork Moderate distributionnetwork Moderatedistribution network High spends onAdvertisementsHigh spends onadvertisingLow spend onAdvertisingHigh Brand valueDecent brand valueHigh brand valueHigh spends on product developmentand innovationModerate spends on product developmentand innovationModerate spends on productdevelopment andinnovationHigh on CSR High on CSR Low on CSR Weakness Focus on building a power brand andneglecting other brandsDistribution network not efficientDistributionnetwork notefficientSticking to oldstrategies for longtimeDo not have acountry wide presence Nirma never projected itself as aPower brand Not enoughadvertising Opportunities Large Consumer baseLarge Consumer baseLarge Consumer baseForecast of Detergent market togrow in IndiaForecast of Detergent market togrow in IndiaForecast of Detergent market togrow in IndiaPer capitaconsumption is HighPer capitaconsumption is HighPer capitaconsumption isHighHigh consumer goods spendingHigh consumer goods spending Nirma is still inthe minds of generation X, YPrice war betweencompetitorsPrice war betweencompetitorsPrice war betweencompetitors Threats Imitation and me too productsImitation and me too productsEntry of local brands

Source: Created by Sharath Shyamasunder (2010) APPENDIX DCOMMON SEGMENTATION VARIABLES FOR DETERGENTSOF HUL 40

HULproductCategoryVariablesExamplesSurf ExcelBehavioralsegmentation Benefits soughtQuality, Value,Convenience,Product usageHeavy , Medium andLight,Occasions orSituationsDaily use/WeeklyPrice sensitiveValue conscious, Statusconscious Demographicsegmentation Age18-60GenderMale/FemaleIncomeMid income, High incomeOccupationWhite collared, technical,Professional, Managers,Laborers, Homemakers,Retired,EducationCollege graduate,GraduateSocial classUpper class, Middle classGenerationGeneration Y,X Babyboomers Psychographicsegmentation PersonalityOutgoing, Shy,Materialistic, Anxious,Civic minded,VenturesomeLifestyleOutdoor Enthusiast,Homely, Workaholic,Family centeredMotivesCleaning Geographicsegmentation RegionalNorth, South, East, WestCityPopulationUrban, Sub urban ,Rural41

HULProduct CategoryVariablesExamplesRINBehavioralsegmentation Benefits soughtQuality, Value,Convenience,Product usageHeavy , Medium andLightOccasions /SituationsDaily use/WeeklyPrice sensitivePrice sensitive, Valueconscious Demographicsegmentation Age18-60GenderMale/FemaleIncomeLow income, Mid income,High incomeOccupationWhite collared, technical,Professional, Laborers,Homemakers, Retired,UnemployedEducationHigh

school, Collegegraduate, GraduateSocial classUpper class, Middle class,Lower class, Poverty levelGeneration Generation Y,X, Laggards Psychographicsegmentation PersonalityOutgoing, Shy,Materialistic, Anxious,Civic minded,VenturesomeLifestyleOutdoor Enthusiast,Homely, Workaholic,Family centeredMotivesCleaning Geographicsegmentation RegionalNorth, South, East, WestPopulationUrban, Sub urban ,Rural42

HULProduct CategoryVariablesExamplesWheelBehavioralsegmentation Benefits soughtQuality, Value,ConvenienceProduct usageHeavy , Medium andLight,Occasions /SituationsDaily use/WeeklyPrice sensitivePrice sensitive, Valueconscious Demographicsegmentation Age18-60GenderMale/FemaleIncomeLow income, Mid incomeOccupationLaborers, Homemakers,Retired, UnemployedEducationHigh school, Collegegraduate, GraduateSocial classMiddle class, Lowerclass, Poverty levelGeneration Baby boomers, Laggards Psychographicsegmentation PersonalityOutgoing, Shy,Materialistic, Anxious,Civic minded,VenturesomeLifestyleOutdoor Enthusiast,Homely, Workaholic,Family centeredMotivesCleaning Geographicsegmentation RegionalNorth, South, East, WestPopulationUrban, Sub urban ,Rural43

APPENDIX E HUL’s mission is to add Vitality to life. We meet everyday needs for nutrition, hygiene and personal care with brands that help people feel good, look good and get more out of life.

Itcontinues to be the market leader in the detergents segment in India. Although in the lastfour years the volumes have gone down. The Volumes shares grow in Laundry 100 bps in powders and 60 bps in Bars. This is due to their continued innovation to provide qualitydetergents at affordable prices.

Surf Excel’s formulation has been improved for better stainremoval without colour damage. The Rin franchise has emerged as India’s number twodetergent brand by value, with particularly good growth in Rin Shakti.Since the competition has intensified significantly, HUL has increased its marketingspend in Media to educate the consumers on the detergents.HUL has strategically invested behind their powerful brands like Surf Excel and Rin. Surf Excel’s “Daag tho acche hain” campaign was a runaway hit among the consumers. Aggressive ads for Rin detergent havehad a very good impact on the brand. Such creative and aggressive ads have helped HUL tomaintain its premium position.The marketing initiatives were supported by major sales initiatives. In rural India,the focus is to further extend reach, which has resulted in direct coverage of about 46% of the rural population as of now. In urban markets, the objective is to improve customer service. Dedicated sales teams have been formed to service key accounts and wholesalers inlarger towns and cities. A cell has been set up to attend to the modern trade, comprisingchain stores. DISTRIBUTION AND RETAIL One of the Major contributors to HUL’s success is its Supply chain and networks. HUL isable to maintain its market share in the detergent industry because of their strongdistribution channel and wide reach across the country. 44

HUL ensures that consumers have ready access to their products across every corner of urban and rural India. Their retail and distribution system spreads across the length and breadth of the country. Their distribution network, comprising about 7,000 redistributionstockiest.6.3 million retail outlets reaching the entire urban population, and about 250million rural consumers .Fig 3.1 Schematic of the distribution network of HUL

45 Factory Just in TimeCustomer Service ProviderBig Box RetailerConsumer

Fig 3.2 Regional sales offices across IndiaSource: HUL (2010). http://www.hul.co.in/ [Accessed 11/05/2010] With the urban market saturated, FMCG companies are now targeting the rural markets. Inspite of the income imbalance between urban and rural India, rural holds great potentialsince 70% of India’s population lives there.Hindustan Unilever Limited (HUL) to tap this market conceived of Project Shakti. This project was started in 2001 with the aim of increasing the company’s rural distributionreach as well as providing rural women with income-generating opportunities. This is acase where the social goals are helping achieve business goals.The recruitment of a Shakti Entrepreneur or Shakti Amma (SA) begins with the executivesof HUL identifying the uncovered village. The representative of the company meets the 46

village head and identifies the woman who they believe will be suitable as a SA. After training she is asked to put up Rs 20,000 as investment which is used to buy products for selling. The products are then sold door-to-door or through petty shops at home. On anaverage a Shakti Amma makes a 10% margin on the products she sells.The main advantage of the Shakti programme for HUL is having more feet on the ground.Shakti Ammas are able to reach far flung areas, which were economically unviable for thecompany to tap on its own.Although the company has been successful in the initiative and has been scaling up, it faces problems from time to time for which it comes up with innovative solutions. For example, a problem faced by HUL was that the SAs were more inclined to stay at home and sell rather than going from door to door. Moreover, men were not liable to go to a woman’s house and buy products. The company countered this problem by hosting Shakti Days.This model has been the growth driver for HUL and presently about half of HUL’s FMCGsales come from rural markets. The Shakti network at the end of 2008 was 45,000 Ammascovering 100,000+ villages across 15 states reaching 3 million homes. The long term aimof the company is to have 100,000 Ammas

covering 500,000 villages and reaching 600 m people. HUL has been successful in maintaining its distribution reach advantage over itscompetitors. This programme will help provide HUL with a growing customer base whichwill benefit the company for years to come. Source: Annual report 2008 HUL. http://www.hul.co.in/ [Accessed 13/05/2010] 47

APPENDIX F A total of 140 respondents have taken the survey and the results are as follows. Questionnaire Section A: Please choose any one of the options1. Which detergent do you use for washing clothes?a.Surf excel b.Arielc.Wheeld.Rine.Nirmaf.Others (Please specify) 55%20%5%5%10%5% Brand Surf Excel Ariel Rin Henko Others Wheel By the graph it is clear that Surf Excel is the most preferred brand. 48

2. What is your frequency of buying detergents for washing clothes?a.Daily b.Weeklyc.Fortnightlyd.MonthlyBy the graph below it is seen that people prefer to buy detergents once in a month,and none of the respondents buy it daily.3. What is the quantity of detergent you buy usually?a. Sachet b. 500 Gmc. 1Kgd. 2kg 49

By this graph we can interpret that people prefer to buy 1kg detergent packets.4. Where do you usually buy the detergent?a. Departmental store nearby b. Super market/ Retailc. Hyper super marketd. Door to door sale/ Home delivery 50

5. Do you use washing machine for washing clothes or hand wash?a. Washing machine b. Hand wash6. Which detergent do you use for washing machine?a.Surf excel automatic front load b.Surf excel automatic top loadc.Arield.Wheele.Rinf.Nirmag.Others (Please specify) 51

7. Are you aware that HUL detergents consume less water while washing clothes?a. Yes b. No 8. Are you satisfied with your detergent?a. Yes b. No 52

9. Do you like the fragrance of the clothes after they are washed using your preferreddetergent?a. Yes b. No 10. Can you differentiate between a HUL brand of detergents and other brands?A. YesB. No 53

Section B: Please circle your choice in each of the options10. How do you rate the quality of the detergent?V PoorPoorAverageGoodV GoodSurf Excel 12345Ariel12345Wheel12345Rin12345 Nirma 12345

54

Others12345(Please specify)On an average Surf Excel’s quality was rated Good. Ariel, Wheel, Rin and Nirma wererated Average. Tide was rated good.11. How do you rate price of the detergent?V CheapCheapAverageCostlyV CostlySurf Excel 12345Ariel12345Wheel12345Rin12345 Nirma 12345Others12345(Please specify)On an Average Surf Excel was rated Costly and all others except Wheel were ratedAverage. Wheel was rated cheap.12. How do you rate the packaging of the detergent?V PoorPoorAverageGoodV GoodSurf Excel 12345Ariel12345Wheel12345 55

Rin12345 Nirma 12345Others12345(Please specify)Surprisingly all the detergents except Wheel were rated Good. Wheel was rated Average.Section C13. What is your gender? (Please tick one)A. Male( )B. Female( )Male were 60%, Female 40%,14. Which age group do you belong? (Please tick one)A. 19 years and below( )B. 20-29 years old( )C. 30-39 years old( )D. 40-49 years old( )E. 50 years and above( ) 56

15. What is your occupation? (Please tick one)A. Student( )B. Employed( )C. Retired( )D. Homemaker( )65% of the respondents were students, 20% were employed, and 15% were homemakers.16. What is your annual Income in Lakhs? (Please tick one)A.1, 50,000.Rs to 2, 50,000.Rs ( )B.2, 50,000.Rs to 3, 50,000.Rs( )C.3, 50,000.Rs to 5, 00,000.Rs( )D.5, 00,000.Rs to 6, 50,000.Rs( )E. 6, 50,000.Rs and Above( ) 57

17. Which product does HUL needs to include in their portfolio of detergents?Please fill the blank ___________________ 70% of the respondents felt that HUL should include the Instawhitener Liquid and 45% of respondents wanted liquid detergent.

APPENDIX G Zero is the amount of inventory HUL's distributors currently hold in Mumbai, andthe amount of inventory that distributors in the 42 major urban centers will hold. Zero isalso the percentage of stock damaged in transit from the company depots to the retailers inMumbai. Given that both these statistics are a rarity, if not a completely anomaly not onlyin India

but also globally, it's not surprising that the company is happy about hitting zerowith such regularity. 58

The 'Go To Market' (GTM) initiative was born out of a range of factors. "The marketplace,as we know it, is changing with the evolution of modern trade. As a result, the throughputfrom general trade is going down in certain markets, affecting the distributor's business.All HUL salesmen now use handheld terminals on which they book replenishment ordersfrom retailers. Once they come back to the distributor, this data is synced in with the systemat HUL. Accordingly, the next the clearing and forwarding agents sends the stock to therespective distributor who in turn sends it to the retailer. Now distributors hold noinventory.For the consumer too, as a result of the increased efficiency, the likelihood of finding therequired product in the shop when they visit it increases. Source: Sangani, P. Economic Times (2009), The Zero Effect Pg no 3. APPENDIX H HINDUSTAN UNILEVER LIMITED (HUL) LEADING CONSUMER GOODSCOMPANY FULFILS BUSINESS OPTIMISATION GOALS WITH SAP(FMCG) industry is an unforgiving one. “If a retailer’s shelves are empty of amanufacturer’s product, he will simply fill them with a competing product,”This challenge of ensuring that the business is optimised to cater to everchanging marketdemands is an issue that HUL is deeply familiar with. Behind HUL’s vast business 59

footprint that spans 4,000 distributors is an entity consisting of 15,000 staff as well asmultiple factories, warehouses and branches. It is not easy keeping its house in order but itfound a perfect solution to its business management needs with SAP.HUL knew that business optimization and supply chain efficiency cannot be achievedwithout tight communication links with its external business partners. However, the task of ensuring seamless connectivity between its IT systems with that of its distributors was notan easy one.In a distributed general trade environment, HUL has implemented a standarddistributor management system. To cover the extended supply chain, the distributor operations needed to be tightly integrated with its internal ERP solutions. This system isfunctioning well; HUL wants to preserve its investment in this area. This meant that thenew ERP solution must be able to integrate with this back-office application too, so thatHUL can continue to leverage and maximize it well into the future. Source: Success stories of SAPwww.sap.com/india/about/company/successes/pdfs/ HUL .pdf

[Accessed on 20/05/2010]