Learn about the corporate marketing strategies adopted in India by: 1. Asian Paints 2. Cavinkare 3. Godrej Consumer Products Ltd 4. Micromax 5. Nirma Chemicals Limited 6. Tata Motors.
Successful Marketing Strategies Examples
Marketing Strategy Example # 1. Asian Paints:
The success of Asian Paints is primarily due to its excellent marketing strategies. The company introduced small packs of paints and expanded the dealer network, particularly in rural and semi-urban markets. These initiatives were aimed at meeting the unmet needs of the customers. The mascot ‘Gattu’ has become very popular among the customers.
The company studied the urban/rural markets and found out that huge volumes of ‘Chuna’ (Lime) was used for painting the houses and walls. Packed distempers, dry distempers and lime wash priced between Rs.5-Rs.20 were sold in these markets. The consumers, in general, were not much satisfied with chuna, since it has to be done every year.
Further, chuna affected the hands, eyes, and even lungs. There are no choice of colours. Chuna tends to flake off, leaving ugly patches on the walls. However, some people used distemper for painting the houses and walls in the place of chuna. The company developed a special brand of distemper “Utsav” priced at Rs.25.00 per kg.
Utsav was made available in one kg. packing to meet the requirement of small sized houses. The launch of the product in each state/region coincided with festivals. Supplies were made to grocery shops in villages through company dealers. Demonstrations, use of local newspaper, helped in creating demand for the product. The product ‘Utsav’ has been accepted as a replacement for chuna and has been recognised as a successful marketing strategy in the paint industry.
The company has entered into technical collaboration with US and Japanese companies for the manufacture of automotive paints to increase its share in industrial paint segment on the IT front, all the 50 depots are connected to the manufacturing plants and Head Office for faster flow of information, monitoring supplies and inventories. Asian Paints is the leader in decorative paint segment with a market share of about 38 per cent.
Marketing Strategy Example # 2. Cavinkare:
In 1983, with a single product, CavinKare started out as a small partnership firm. Chik Shampoo was introduced by the company in 1983. The target audience was lower middle class, semi urban, monthly household income Rs.1500-3000, females in the age-group of 16 plus.
Radio was used as mass medium with popular cinema dialogues. To encourage trials, the sales team contacted school boys to demonstrate how to lather, wash, and comb hair and show the difference. Another method used was through a consumer scheme where anyone could take any four empty shampoo sachets to a retailer and take home a chik sachet free.
Chik was the first shampoo to be launched in sachet packing priced 50 paise and the strategy revolutionised the shampoo market in our country. Today, Chik is a Rs.200 crore brand and about 60 per cent of the Chik sales come from rural markets.
The company now markets ten major brands. Over the years, CavinKare has achieved a competitive edge with sound understanding of mass marketing dynamics. The company offers quality personal care (hair care, skin care, home care) and food products borne out of a keen understanding of consumer needs and keeping up company’s values of innovation and customer satisfaction.
Hair Care- Chik Shampoo, Nyle Herbal Shampoo, Meera Badam Shampoo, Indica Hair Colorant.
Ethnic Care- Meera Hair Wash Powder, Karthika Hair Wash Powder; Meera Herbal Hair Oil.
Skin Care- Fairever, Spinz Talc/deodorant, Nyle Cold Cream and Lotion
A dedicated Research & Development Centre, equipped with latest equipment and technologies, constantly supports the various divisions in their endeavour. The Company, which primarily relied on contract manufacturing for many years, has now set up its own world-class plant at Haridwar to cater to the demand of both domestic and international market.
CavinKare Group has crossed a turnover of Rs.890 crores in 2009-2010. The Company has employee strength of 1,520, an all India network of 1,300 Stockists catering to about 25 lakh outlets nationally.
Marketing Strategy Example # 3. Godrej Consumer Products Ltd.:
Godrej Consumer Products (GCPL) is a leader among India’s Fast Moving Consumer Goods (FMCG) companies, with leading Household and Personal Care Products. Their brands, which include Good Knight, Cinthol, Godrej No. 1, Expert, Hit, Jet, Fairglow, Ezee, Protekt, and Snuggy, among others, are household names across the country.
GPCL is one of the largest marketers of toilet soaps in the country and are also leaders in hair colours and household insecticides. The ‘Good knight’ brand has been placed at an overall rank of 12 and continues to be the most trusted household care brand in the country in Brand Equity’s Most Trusted Brands Survey 2010.
Soap- Cinthol, Evita, Godrej No. 1, Fair Glow
Toiletries- Cinthol Talc, Godrej No. 1 Talc, Fair Glow cream, Godrej shaving cream, Cinthol perfumes
Hair care- Godrej hair colour dye, Renew woman hair dye, Nupur hair dye, Colour soft hair colour
Household care- Godrej Dish wash liquid, Godrej Glossy
Fabric care- Godrej Ezee
Godrej No. 1 soap was launched in 1922. This 88-year-old brand enjoys a volume market share of six per cent. It is the 5th largest selling soap in the country and tops in Punjab/Haryana with a 20 per cent market share. Godrej No. 1 soap relies on below-the-line promotions, and for the past seven years it has been selling at a 3 + 1 free offer in the market.
In 88 years, the brand has spent less than what a major soap brand would spend in a month of heavy promotions (Rs.12-13 crore), according to the company. Godrej introduced Godrej No. 1 soap enriched with natural ingredients trusted by millions, the flagship brand of Godrej Consumer Products Ltd., is now the largest selling Grade 1 Soap.
Grade 1 is the highest standard laid down by the Bureau of Indian Standards (BIS). Godrej introduced it in competition with the Santoor, Breeze. Godrej in the initial stage introduced it as a mid-segment soap but after sometime its price was reduced and targeted to the rural area.
Godrej No. 1 Soap- Godrej introduced many variants like Sandal, Jasmine, Ayurvedic, Lavender, etc. to extend the product line of soap. Each variant is a little different from the others. The variants are introduced to satisfy the varying needs of the consumers. It also introduced different product category like talc, shampoo under the name of Godrej No. 1.
Godrej No. 1 Talc- It is available in two variants- (1) Jasmine, and (2) Sandal.
Godrej No. 1 Shampoo- Godrej No. 1 launched, for the first time in India, Aloe-Almond combination in a Shampoo.
(ii) Pricing Differentiation Strategy:
In order to reach out to the masses, it was necessary to develop smaller SKUs and hence price them accordingly. Godrej No. 1 soap did just that. Their products came in different sizes and pricing varied accordingly.
Following are the various pricing schemes for the different product sizes:
115 gms (Pack of 4) at Rs.50/- 90 gms (Pack of 4) at Rs.40/-
90 gms (Pack of 3) at Rs.30/- 70 gms (Pack of 4) at Rs.30/- and
40 gms singles at Rs.5/-
They use bundle pricing strategy to attract the masses.
The company has ambitious plans to extend distribution to smaller towns and rural markets. The company is setting up a system of stockists and super stockists in small towns with population of 10,000 plus. At present, rural sales contribute one-third of the company’s sales with the balance coming from the urban market. Godrej Soaps’ total income was Rs. 1,300 crores in the fiscal 2009-2010.
Project “Sampark,” is a distributor management system used for stock management, billing to retailers, accounting and report generation. The objective of implementing Sampark was to reduce the working capital of distributors. This in turn would give a better return on investment leading to more coverage and hence more sales.
It is used by 300 distributors who account for 67 per cent of the company’s sales. It provided a virtual platform between company and distributors. Also, comprehensive Business Intelligence enables in depth primary and secondary sales analysis.
Intensified rural approach- presence in all locations with over 10,000 population with 130 Super Stockists, and 2,450 sub-stockists.
i. Focus on availability of all products at all 600,000 outlets; Focus on modern retailing.
ii. Events- Godrej No. 1 hosts a variety of events which helps it to connect with the masses.
iii. Godrej No. 1 Sahyadri Navratna Awards- These awards are held every year. The event for the year 2009 was sponsored by Godrej No. 1 Lime & Aloe Vera. These awards honour the artists who contribute to the growth of the Marathi film industry round the year. Marathi film industry is very close to the masses of Maharashtra. Thus, through these awards, Godrej No. 1 aims to develop connect with the rural and semi-urban Maharashtra.
iv. Godrej No.1 Gold Awards- The first ever Television Awards for Indian Television was sponsored by Godrej No. 1 in 2007. This is an award show honouring the best in Indian Television, across Hindi TV channels. The television is said to be the silver screen for the middle class. Through such awards Godrej No. 1 managed to reach the middle class household.
v. Yaara Nachle Live- Godrej No. 1 Lavender Soap presented Yaara Nachle Live at alandhar. Identifying the tastes of entertainment of Northern India, Godrej No. 1 held this event to popularise itself in the North.
vi. Advertising- Billboard, Hoarding, Wall painting, Electronic media, Print media.
vii. Sales promotion
viii. GODREJ Consumer Products Ltd. (GCPL), has roped in Mona Singh of Jassi Jaissi Koi Nahin (a popular serial on the Sony channel) to be the brand ambassador for Godrej No.1 soaps.
ix. Godrej No.1 soap was the largest selling brand of Grade I Soap in the country and Jassi conveyed the importance of using Grade I quality soaps to the viewers.
x. The new Godrej No. 1 ad takes a typical situation inside any Indian home. The theme of the campaign revolves around the proverbial statement, “All that Glitters is not Gold … All soaps are not Grade I quality soaps”
xi. The campaign educates people about the advantages of using Grade I quality soaps that produce more lather, last longer and thus are a great value-for-money proposition. (75 gm bar of Grade III toilet would last for 28 baths compared to Grade I soap which lasts much longer).
xii. Godrej Soaps and Jassi both stand for the Sachchi prakritik sundarta proposition, according to the company.
Marketing Strategy Example # 4. Micromax:
Micromax is one of the leading Indian Telecom Companies with 23 domestic offices across the country and international offices in Hong Kong, USA, Dubai and now in Nepal. With a futuristic vision and an exhaustive R&D at its helm, Micromax has successfully generated innovative technologies that have revolutionised the telecom consumer space.
In the year 2008, after delivering upon the technology of fixed wireless-powering desired products, the company forayed into telecommunication — Mobile handsets. Since then Micromax has received commendable response for its unique and interesting handsets.
Micromax has a lot of “firsts” to its credit on their versatile product portfolio. It was the first to introduce, Handsets with 30 days battery backup, Handsets with Dual SIM/Dual Standby, Handsets Switching Networks (GSM-CDMA), Aspirational Keypad Handsets, Operator Branded 3G Handsets, OMH CDMA Handsets, etc.
One of the major aspects that contribute towards the substantial monthly growth of Micromax is its 80 per cent sales in the rural areas. It has a market share of eight per cent, behind Samsung in second position with 10 per cent market share.
Go-to-Market Strategy:
Micromax concentrated on the rural market first. Micromax launched its first phone in the rural market with a very unique USP-30 day’s battery standby time. The first product was a big success — Micromax XII priced at X 2,150 was lapped up by rural market. Established Distribution Network-34 super distributors, 450 distributors and around 55,000 retailers.
Micromax managed to make dealers pay in advance by offering them more margins. It offered higher margins of 15 per cent margin, which is higher than the industry average of 6-10 per cent. To increase penetration in the Indian telecom market, Micromax is bundling with telecom operators such as Aircel.
For better accessibility and prominence in the market, Micromax is coming up with 150 experience zones (exclusive stores) across the nation, in addition to ensuring bigger presence at the multi-branded stores.
They introduced products with comparatively lower prices focusing mainly on adding particular innovative features. This gave them a competitive edge over the others and made micromax a primary choice for the rural consumers.
1. 30-day Battery Phones- April 2008- 2,249; Now- 1,999 The X1i, Micromax’s first phone, had a battery that could give 17 hours of talk time and go 30 days on a single charge.
2. Dual-Sim Phones- July 2008- Rs.1,999-2,999 For those who want two numbers but one handset.
3. Phone-cum-Remote- May 2010- Rs.2,999 A mobile that can switch TV channels and even change the temperature settings on AC.
Besides the focus on product development, Micromax has invested heavily in brand building. The brand is one of the big spenders in the latest edition of IPL (2011). Micromax has centered much of its brand building exercise around cricket. The company believes that cricket promotions will prove to be a great platform to reach out to the audience and give the brand an opportunity to bond with the youth.
Micromax has taken up the title sponsorship for the entire Indian cricketing season from May 2010. Micromax is also planning an innovative activation across the cricket season, breaking away from the vanilla branding that we are all used to. Activation will see some intelligent product placements, on ground-on air integrated product coverage and mentions, crowd branding and the brand will be visible on a digital platform on the ground throughout, adding to the technology stand-point.
Micromax was one of the principal sponsors of the South Africa vs. India ODI series in 2010. In the just concluded ‘Micromax cup’, as the name suggests it was the chief sponsor. Micromax, has shelled out a whopping Rs.100 crore for its brand building initiative. It is targeting a wide base of new and existing subscribers, using a 360 degree media approach via multiple platforms. It has allotted?
60 crore for ATL (above the line) advertising, of which print will take the maximum share, followed by TV and radio, another Rs.40 crore will go into the BTL (below-the-line) initiatives. The communication has been launched in the beginning of 2010.
Marketing Strategy Example # 5. Nirma Chemicals Limited:
In olden days, the detergent powder category belonged to Lever’s Surf. Common opinion was a quality detergent, had to be a blue powder and packed in a colourful carton. But Nirma was launched as a white coloured product, packed in pouches, sealed at the top, with no colour or design sophistication on the pack. The product was priced at around 35 per cent of Surf. Nirma’s market share grew from 0 per cent in 1976 to about 60 per cent in 1987.
Nirma dared to break the rule that a packaged, especially advertised brand needed the paraphernalia of branch office, area managers and sales representatives in order to carry it through wide and complicated network. Nirma went in for a “no-frills” approach in production, sales distribution and organisational arrangements. The title ‘Nirma girl’ going round and round on her feet makes a strong mnemonic for the brand.
Nirma shattered the myth ‘economy at the cost of quality.’ Nirma over a period of ten years has become the largest selling brand and the success of Nirma is due to affordable price, medium quality, distribution reach and effective use of media.
Marketing Strategy Example # 6. Tata Motors:
Tata Motors Limited, established in 1945, is India’s largest automobile company, with consolidated revenues of Rs.92,519 crores in 2009-10. It is the leader in commercial vehicles in each segment, and among the top three in passenger vehicles with winning products in the compact, mid-size car and utility vehicle segments. The company is the world’s fourth largest truck manufacturer, and the world’s second largest bus manufacturer.
The company’s 24,000 employees are guided by the vision to be “best in the manner in which we operate, best in the products we deliver, and best in our value system and ethics.”
They have a wide product range including passenger cars like Indica, Indigo, Nano, Fiat; Utility Vehicles like Aria, Sumo, Safari, Xenon; trucks in the form of medium & heavy, small and light commercial vehicles as well as commercial passenger vehicles like buses and defence vehicles.
Tata Motors commercial vehicles are known for their reliability and durability. Seven out of every 10 trucks on Indian roads proudly carry the Tata logo.
Tata Motors had consciously decided to focus on being a customer-centric company rather than a product-centric one, developing products that fit customer requirements rather than making customers adjust their requirements to suit existing vehicles.
With this intention, in 2002, the company remodelled their Tata mobile in response to customer feedback asking for an economical and reliable vehicle for intra-city and local transport, and the 207 CM was born — a sturdier vehicle that drives well on dirt tracks, has a higher operating speed and more applications. Changing customer attitudes are driving the market today. Issues like reliability and low maintenance costs are now basic requirements, not product differentiators.
Who is the Customer?
With the help of McKinsey, the company classified its customers into a four-level pyramid. At the bottom was the acquisition-price-sensitive customer, who is looking only at price, not performance. Above that is the return-on-investment customer, who is willing to pay price for better value. The third layer is the looking-for-a-balance customer, who weighs both price and performance.
At the top is the only-performance customer, who is willing to pay a higher price for it. The rural customer is not too aware of features and benefits, and is found more at the lowest end of the pyramid, while the educated urban customer lies at the second level. In both urban and rural India, there will be customers in all the four segments, in varying percentages.
Through its interaction with customers, the company learnt that the five essential attributes they look for in a small commercial vehicle are lower operating costs (as compared to a three-wheeler), reliability, durability, safety and comfort, and — most important of all — a viable business proposition.
Commercial vehicles are actually a business investment. If a customer is not able to earn the money to be able to pay back the acquisition price and earn some profit, he is not going to buy the vehicle.
Ace — The Baby Elephant:
The company realised that the entry level for the semi-urban and rural market was a product between a three-wheeler and a pick-up truck, at a price-sensitive level. It put together a team to develop such a vehicle, and it came up with an Ace. A sturdy vehicle that can carry loads up to 1.5 tonnes over distances up to 300 km, the Ace is a four-wheeler at a price slightly higher than a three-wheeler, but offering greater stability, safety and comfort.
More important, the operating cost was extended to a product life-cycle cost, which covered purchase cost, operating cost and resale price. “It has the lowest product lifecycle cost; that is our USP. It is essentially a last-mile load carrying vehicle, useful in congested cities as well,” says Mani.
The brand communication for the Ace was ‘All the goodness of the Tata Truck now in a mini size’ — thereby the description of the category as a mini-truck. Using the metaphor of an elephant (a mother elephant representing the Tata truck), the Ace was simply called the baby elephant!” They positioned the Ace as “Chotta Haathi” through rural advertising.
Vehicle Finance:
The low-price-high-performance Ace has cast its spell on auto financers in urban areas, who now offer five-year financing for the vehicle (three-wheelers get only two/three-year financing), so that customers pay a monthly instalment approximately the same as hat for a three-wheeler. “The instalment payment has gone down and income has increased, boosting net earnings. The customer is happy and our sales have jumped. It’s a win-win situation.”
Cityride:
Tata Motors has also developed the Cityride bus, a low-end, 16-seater bus built on the existing 407 platform for passenger movement between small towns. As-markets continue to move towards semi-urban and rural areas, the company is extending its reach through a unique concept called 1S outlets, that handle only sales.
At over 300 such outlets across India, customers can see and buy the product within 50 to 100 km of their village. Apart from its dealers, Tata Motors has tied up with local garages for servicing, and enhanced their service skills through training.
Indica/Nano:
Till 1980’s, the Indian customer had limited choice of cars as he had to choose between the Ambassador, the Fiat or the Standard. The customer had to make advance payment and wait in queue for a few months to take delivery of the car. The gap between demand and supply was very wide and therefore, there was least focus on customer orientation and customer service.
In mid-1980’s the Government took a decision to issue licences to manufacturers to produce passenger cars and this initiative started a revolution in the market. Maruti Udyog introduced Maruti 800 a modern car with fuel efficiency and the company became a leader in the passenger vehicle market.
Following liberalisation in 1990’s, many international car manufacturers i.e., Daewoo, GM, Ford, Fiat, Toyota, Daimler-Chrysler, Hyundai entered the car market introducing a wide range of models varying from functional models (Matiz) to classic premium (Mercedes Benz). The Ambassadors and the Fiats entered the decline stage as they were not able to stand in the market.
Among the Indian companies, Telco had developed expertise in manufacturing trucks and they were enjoying a near monopoly position in buses and trucks market. Telco with their experience in manufacturing and marketing, entered the car market successfully. It has introduced own models like Tata Sumo, Tata Sierra, Tata Estate and has a joint venture with Benz, to manufacture/market Mercedes Benz cars in India.
After extensive studies, they were able to design a truly Indian car i.e. Indica for Indian market. Over a period of time, Indica has been accepted by functional buyers both in cities and in semi-urban markets. The company has also introduced Indigo in the lower premium car segment. While Indica competes with Zen, Santro and Wagon R, Indigo is positioned against Esteem and Hyundai Accent.
Telco set up an Engineering Research Centre in Pune with a view to design a small car to meet the requirements of emerging middle class population who wants to move from two- wheelers to four-wheelers. The small car (The Rs.1 lakh car as it is known) is priced between two wheelers and Maruti 800.
Regarding Models, there will be three trim levels (rudimentary, middle and high) and buyers would be able to upgrade from one level to another. It has rear engine (800 cc) and will meet all emission and safety norms. The small car is available in the market from 2010.