INTRODUCTION Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods Company, touching the lives of two out of three Indians with over 20 distinct categories in Home & Personal Care Products and Foods & Beverages. The company’s Turnover is Rs. 20, 239 crores (for the 15 month period – January 1, 2008 to March 31, 2009). Hindustan unilever limited is a subsidiary of Unilever, one of the world’s leading suppliers of fast moving consumer goods with strong local roots in more than 100 countries across the globe with annual sales of €40.5 billion in 2008. Unilever has about 52% shareholding in HUL. Hindustan Unilever was recently rated among the top four companies globally in the list of “Global Top Companies for Leaders” by a study sponsored by Hewitt Associates, in partnership with Fortune magazine and the RBL Group. The company was ranked number one in the Asia-Pacific region and in India. The mission that inspires HUL's more than 15,000 employees, including over 1,400 managers, is to “add vitality to life". The company meets everyday needs for nutrition, hygiene, and personal care, with brands that help people feel good, look good and get more out of 1
Transcript
INTRODUCTION
Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods Company, touching the lives of two out of three Indians with over 20 distinct categories in Home & Personal Care Products and Foods & Beverages. The company’s Turnover is Rs. 20, 239 crores (for the 15 month period – January 1, 2008 to March 31, 2009).
Hindustan unilever limited is a subsidiary of Unilever, one of the world’s leading suppliers of fast moving consumer goods with strong local roots in more than 100 countries across the globe with annual sales of €40.5 billion in 2008. Unilever has about 52% shareholding in HUL. Hindustan Unilever was recently rated among the top four companies globally in the list of “Global Top Companies for Leaders” by a study sponsored by Hewitt Associates, in partnership with Fortune magazine and the RBL Group. The company was ranked number one in the Asia-Pacific region and in India.
The mission that inspires HUL's more than 15,000 employees, including over 1,400 managers, is to “add vitality to life". The company meets everyday 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 HUL shares with its parent company, Unilever, which holds about 52 % of the equity.
Heritage
HUL’s heritage dates back to 1888, when the first Unilever product, Sunlight, was introduced in India. Local manufacturing began in the 1930s with the establishment of subsidiary companies. They merged in 1956 to form Hindustan Lever Limited (The company was renamed Hindustan Unilever Limited on June 25, 2007). The company created history when it offered equity to Indian shareholders, becoming the first foreign subsidiary company to do so. Today, the company has more than three lakh resident shareholders.
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HUL’s brands -- like Lifebuoy, Lux, Surf Excel, Rin, Wheel, Fair & Lovely, Sunsilk, Clinic, Close-up, Pepsodent, Lakme, Brooke Bond, Kissan, Knorr, Annapurna, Kwality-Walls - are household names across the country and span many categories - soaps, detergents, personal products, tea, coffee, branded staples, ice cream and culinary products. They are manufactured in over 35 factories, several of them in backward areas of the country. The operations involve over 2,000 suppliers and associates. HUL's distribution network covers 6.3 million retail outlets including direct reach to over 1 million.
HUL has traditionally been a company, which incorporates latest technology in all its operations. The Hindustan Lever Research Centre (now Hindustan Unilever Research Centre) was set up in 1958
Doing well by doing good
HUL believes that an organisation’s worth is also in the service it renders to the community. HUL focuses on hygiene, nutrition, enhancement of livelihoods, reduction of greenhouse gases and water footprint.It is also involved in education and rehabilitation of special or underprivileged children, care for the destitute and HIV-positive, and rural development. HUL has also responded in case of national calamities / adversities and contributes through various welfare measures, most recent being the relief and rehabilitation of the people affected by the Tsunami disaster, in India.
HUL’s Project Shakti is a rural initiative that targets small villages populated by less than 5000 individuals. Through Shakti, HUL is creating micro-enterprise opportunities for rural women, thereby improving their livelihood and the standard of living in rural communities. Shakti also provides health and hygiene education through the Shakti Vani programme.The program now covers 15 states in India and has over 45,000 women entrepreneurs in its fold, reaching out to 100,000 villages and directly reaching to over three million rural consumers.
HUL also runs a rural health programme, Lifebuoy Swasthya Chetana. The programme endeavours to induce adoption of hygienic practices among rural Indians and aims to bring down the incidence of diarrhoea. It has already touched 120 million people in approximately 50, 676 villages across India.
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If Hindustan Unilever straddles the Indian corporate world, it is because of being single-minded in identifying itself with Indian aspirations and needs in every walk of life.
Type Public company BSE: 500696
Industry Fast Moving Consumer Goods FMCG)
Founded 1933
Headquarters Mumbai, India
Key people Harish Manwani (Chairman), Nitin Paranjpe (CEO and
In the summer of 1888, visitors to the Kolkata harbour noticed crates full of
Sunlight soap bars, embossed with the words "Made in England by Lever Brothers". With it, began an era of marketing branded Fast Moving Consumer Goods (FMCG).
Soon after followed Lifebuoy in 1895 and other famous brands like Pears, Lux and Vim. Vanaspati was launched in 1918 and the famous Dalda brand came to the market in 1937.
In 1931, Unilever set up its first Indian subsidiary, Hindustan Vanaspati Manufacturing Company, followed by Lever Brothers India Limited (1933) and United Traders Limited (1935). These three companies merged to form HUL in November 1956; HUL offered 10% of its equity to the Indian public, being the first among the foreign subsidiaries to do so. Unilever now holds 52.10% equity in the company. The rest of the shareholding is distributed among about 360,675 individual shareholders and financial institutions.
The erstwhile Brooke Bond's presence in India dates back to 1900. By 1903, the company had launched Red Label tea in the country. In 1912, Brooke Bond & Co. India Limited was formed. Brooke Bond joined the Unilever fold in 1984 through an international acquisition. The erstwhile Lipton's links with India were forged in 1898. Unilever acquired Lipton in 1972 and in 1977 Lipton Tea (India) Limited was incorporated.
Pond's (India) Limited had been present in India since 1947. It joined the Unilever fold through an international acquisition of Chesebrough Pond's USA in 1986.
Since the very early years, HUL has vigorously responded to the stimulus of economic growth. The growth process has been accompanied by judicious diversification, always in line with Indian opinions and aspirations. The
liberalisation of the Indian economy, started in 1991, clearly marked an 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 any constraints on production capacity.
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Simultaneously, deregulation permitted alliances, acquisitions and mergers. In one of the most visible and talked about events of India's corporate history, the erstwhile Tata Oil Mills Company (TOMCO) merged with HUL, effective from April 1, 1993. In 1996, HUL and yet another Tata company, Lakme Limited, formed a 50:50 joint venture, Lakme Unilever Limited, to market Lakme's market-leading cosmetics and other appropriate products of both the companies. Subsequently in 1998, Lakme Limited sold its brands to HUL and divested its 50% stake in the joint venture to the company.
HUL formed a 50-50 joint venture with the US-based Kimberly Clark Corporation in 1994, Kimberly-Clark Lever Ltd, which markets Huggies Diapers and Kotex Sanitary Pads. HUL has also set up a subsidiary in Nepal, Unilever Nepal Limited (UNL), and its factory represents the largest manufacturing investment in the Himalayan kingdom. The UNL factory manufactures HUL's products like Soaps, Detergents and Personal Products both for the domestic market and exports to India.
The 1990s also witnessed a string of crucial mergers, acquisitions and alliances on the Foods and Beverages front. In 1992, the erstwhile Brooke Bond acquired Kothari General Foods, with significant interests in Instant Coffee. In 1993, it acquired the Kissan business from the UB Group and the Dollops Ice-cream business from Cadbury India.
As a measure of backward integration, Tea Estates and Doom Dooma, two plantation companies of Unilever, were merged with Brooke Bond. Then in 1994, Brooke Bond India and Lipton India merged to form Brooke Bond Lipton India Limited (BBLIL), enabling greater focus and ensuring synergy in the traditional Beverages business. 1994 witnessed BBLIL launching the Wall's range of Frozen Desserts. By the end of the year, the company entered into a strategic alliance with the Kwality Ice-cream Group families and in 1995 the Milk-food 100% Ice-cream marketing and distribution rights too were acquired.
Finally, BBLIL merged with HUL, with effect from January 1, 1996. The internal restructuring culminated in the merger of Pond's (India) Limited (PIL) with HUL in 1998. The two companies had significant overlaps in Personal Products, Speciality Chemicals and Exports businesses, besides a common distribution system since 1993 for Personal Products. The two also had a common management pool and a technology base. The amalgamation was done to ensure for the Group, benefits from scale economies both in domestic and export markets and enable it to fund investments required for aggressively building new categories.
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In January 2000, in a historic step, the government decided to award 74 per cent equity in Modern Foods to HUL, thereby beginning the divestment of government equity in public sector undertakings (PSU) to private sector partners. HUL's entry into Bread is a strategic extension of the company's wheat business. In 2002, HUL acquired the government's remaining stake in Modern Foods.
In 2003, HUL acquired the Cooked Shrimp and Pasteurised Crabmeat business of the Amalgam Group of Companies, a leader in value added Marine Products exports.
HUL launched a slew of new business initiatives in the early part of 2000’s. Project Shakti was started in 2001. It is a rural initiative that targets small villages populated by less than 5000 individuals. It is a unique win-win initiative that catalyses rural affluence even as it benefits business. Currently, there are over 45,000 Shakti entrepreneurs covering over 100,000 villages across 15 states and reaching to over 3 million homes.
In 2002 In 2002, HUL made its foray into Ayurvedic health & beauty centre category with the Ayush product range and Ayush Therapy Centr es. Hindustan Unilever Network, Direct to home business was launched in 2003 and this was followed by the launch of ‘Pure-it’ water purifier in 2004.
In 2007, the Company name was formally changed to Hindustan Unilever Limited after receiving the approval of share holders during the 74th AGM on 18 May 2007. Brooke Bond and Surf Excel breached the the Rs 1,000 crore sales mark the same year followed by Wheel which crossed the Rs.2,000 crore sales milestone in 2008.
On 17th October 2008, HUL completed 75 years of corporate existence in India
REVIEW OF LITERATURE
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Hindustan Unilever Limited is the Indian arm of the Anglo-Dutch company –Unilever. Both Unilever and HUL have established themselves well in the Fast Moving Consumer Goods (FMCG) category. In India, the company offers many households brands like, Dove, Lifebuoy, Lipton, Lux, Pepsodent, Ponds, Rexona, Sunsilk, Surf, Vaseline etc. Some of its efforts were also rewarded when four of HUL brands found place in the ‘Top 10 brands’ list for the year 2008 published in The Economic Times.
Unilever was a result of the merger between the Dutch margarine company, Margarine Unie, and the British soap-maker, Lever Brothers, way back in 1930. For 70 years, Unilever was the undisputed market leader but now faces tough competition from Proctor & Gamble and Colgate-Palmolive.
HUL is also known for its strong distribution network in India. In order to further strengthen its distribution in the rural areas and to empower the local women, HUL launched a Project Shakti in 2000 in a district in Andhra Pradesh. The idea behind this project was to create women entrepreneurs and provide them with micro-credit and training in enterprise management, which would enable them to create self- help groups and become direct-to-home distributors of HUL products. Today Project Shakti is present across 80,000 villages in 15 states and is helping many underprivileged women earn their livelihood.
As the per-capita income of India is increasing along with the Indian population. So, the future for the FMCG Companies is bright. To analysis the past performance & the future demand of HUL, FMCG products we have considered following points:
We have a listed the different FMCG product lines of HUL.
We have done competitor’s analysis in which the market share of top FMCG companies are analysed & the market share of HUL’S different categories product are analysed with comparison to its competitors.
Then performance analysis is made by taking 10 year financial data from 1998-2007. The profit & sales growth is analysed We have done SWOT analysis to know the threat & opportunities of HUL in present market.
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The future opportunities for FMCG products are taken into consideration by analyzing the increased per capita income & increased disposable income to forecast the future demand of HUL.
OBJECTIVE OF STUDY
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The main objective of this project is to find, what are the steps Hindustan Unilever Ltd. is adapting to be market leader and to differentiate itself from its competitors.
What is the steps company is utilizing to find current trend in the market.
To study various brands of HUL
To study the competitive brands in the market of ,home care products,.food brands,personal care products
To find the market share of the HUL brands and its competitive brands.
To determine the key areas of strength and weakness for HUL brands To develop a promotion plan for brand communication of the HUL
To study various marketing strategies of huL
RESEARCH METHODLOGY
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There is large no. of FMCG companies in the market, to find the defining strategies used, the methodology used is interview and survey method.
Data Collection Method:
For this research study, primary data as well as secondary data was collected
Primary Data has been collected through personal contact. For this purpose both questionnaireand one-on-one interview was considered with the consumers, shop owners and distributors & suppliers of the company.
Secondary data has collected from magazines, newspaper, company literature and websites.
Data analysis:
Analyzing codes to each question were awarded. thereafter which aws written and than analysed
MAJOR FINDINGS
Major competitors
1. Dabur
2. Jhandu
3. Johnson &Johnson
4. Cavin Care
5.Procter & Gamble 6. Britannia
7. ITC
8. Gillette
METHODOLOGY FOR RESEARCH PROBLEM
Following steps where taken in to consideration, to identify the research problem-
1. Informal investigation
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• Visit to the shop owners, talked to the distributors and to the consumers in the locality and surrounding areas.
2.External and Internal Analysis
• Understanding customer problem
• Understanding the market structure
3. Situational Analysis
• Tastes & preferences
• Needs & income
• Major Competitors
ITC
Dabur
Procter & Gamble
Cavin Care
Amul
Johnson & Johnson, etc
A Compressive study of Secondary and Primary data (Informal Interviews) was collected through specific questionnaires for people and shop-owners & distributors.
SAMPLING TECHNIQUE
For my survey I used Cluster Sampling technique. I selected a sample of 100 people around the area and interviewed them according to the questionnaire. In the survey I tried to find out their preferences & tastes, their purchasing habit, are they brand loyal or they consider their friends advice or some reference group duringpurchasing. I also tried to find out that are they satisfied with the quality or present stature of product, did they want any change in the existing product.
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I also interviewed some of the shop owner and distributors and try to find out what the company is doing to sustain their customer and what new changes they are bringing in their product to gain competitive advantage from other competitors
RESEARCH INSTRUMENT
Research instruments, for the purpose of primary data collection were Questionnaires. The Questionnaires were designed in two sets, one is for customers and another is for shop-owners and distributors.
• The first set is to find out about the needs and preferences of the customers and what they want from in the product and also the level of knowledge about different products in the market.
• Second set is all about what are the steps company are taking to get about the information about he changing preferences in the taste and needs of the customers and what company is doing to sustain their market position as well as to tap new market.
DATA ANALYSIS
For the analysis of data collected through survey work, a series of steps were followed which are given in a chronological order
•Each question of the questionnaire was assigned codes (coding)
•Each questionnaire was punched into ms-excel sheet thus forming a data base (punching)
•Further the data was analyzed by using diagrams, graphs, charts etc.
•The graphic rating scale and ranking method was used to measure the response and attitude of the customer.
Finally, an effort was made to extract meaningful information from analyzed data, which acted as a base for the recommendations
LIMITATIONS OF THE STUDY
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In attempt to make this project authentic and reliable, every possible aspect of the topic was kept in mind. Nevertheless, despite of fact constraints were at play during the formulation of this project.
The main limitations are as follows:
Due to limitation of time only few people were selected for the study. So the sample of consumers was not enough to generalize the findings of the study.
The main source of data for the study was primary data with the help of self- administered questionnaires. Hence, the chances of unbiased information are less.
People were hesitant to disclose the true facts.
The chance of biased response can’t be eliminated though all necessary steps were taken to avoid the same.
Vision of Hindustan unilever limited
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Unilever products touch the lives of over 2 billion people every day – whether that's through feeling great because they've got shiny hair and a brilliant smile, keeping their homes fresh and clean, or by enjoying a great cup of tea, satisfying meal or healthy snack.
A clear direction
The four pillars of our vision set out the long term direction for the company – where we want to go and how we are going to get there:
• We work to create a better future every day
• We help people feel good, look good and get more out of life with brands and services that are good for them and good for others.
• We will inspire people to take small everyday actions that can add up to a big difference for the world.
• We will develop new ways of doing business that will allow us to double the size of our company while reducing our environmental impact. We've always believed in the power of our brands to improve the quality of people’s lives and in doing the right thing. As our business grows, so do our responsibilities. We recognise that global challenges such as climate change concern us all. Considering the wider impact of our actions is embedded in our values and is a fundamental part of who we are.
Purpose & principles of hul
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Our corporate purpose states that to succeed requires "the highest standards of corporate behaviour towards everyone we work with, the communities we touch, and the environment on which we have an impact."
Always working with integrity
Conducting our operations with integrity and with respect for the many people, organisations and environments our business touches has always been at the heart of our corporate responsibility.
Positive impact
We aim to make a positive impact in many ways: through our brands, our commercial operations and relationships, through voluntary contributions, and through the various other ways in which we engage with society.
Continuous commitment
We're also committed to continuously improving the way we manage our environmental impacts and are working towards our longer-term goal of developing a sustainable business.
Setting out our aspirations
Our corporate purpose sets out our aspirations in running our business. It's underpinned by our code of business Principles which describes the operational standards that everyone at Unilever follows, wherever they are in the world. The code also supports our approach to governance and corporate responsibility.
Working with others
We want to work with suppliers who have values similar to our own and work to the same standards we do. Our Business partner code, aligned to our own Code of business principles, comprises ten principles covering business integrity and responsibilities relating to employees, consumers and the environment.
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MARKETING STRATEGYOF HINDUSTAN UNILEVER LIMITED
1)HUL’S NEW GROWTH STRATEGY:
After having fought a bitter price battle for market share with its rivals, Hindustan Unilever Ltd (HUL), Indian subsidiary of the Anglo- Dutch consumer goods company Unilever Plc, is now working on a new growth strategy for its laundry business.
“Price cut or hike is not a long-term growth strategy. Pricing, in fact, is now passe,” insists Sudhanshu Vats, category head, home care. “Our strategy for growth, now is focused on product innovation, new consumer and retail trends and aggressive marketing and promotions,” he said.
This comes even as Unilever is scouting for a potential buyer for its laundry business in the US.
HUL says it is quite upbeat about the segment and says the laundry segment is one of its “key growth areas. “We have done key innovations across the product portfolio and it is working for us,” says Vats. “We successfully migrated from Rin Supreme to Surf Excel and Wheel Smart Srimati—which was rolled out in 2006—is also on the right track.”
HUL’s market share in the laundry segment grew to around 37.8% in the quarter ended June from 35.5% in the same period last year, according the market research firm ACNielsen. However, this time, the increase was not at the expense of price war with its multinational rival Procter & Gamble Co. P&G also gained 0.5 percentage points, up to a 7.6% share. Nirma Ltd, the Ahmedabad- based manufacturer, however, saw its market share dip by 1.7% percentage points to 13.5%.
Wheel, a value brand that, according to Vats contributes around 50% of HUL’s laundry segment revenues, increased its market share by 2 percentage points in the same period, with a total share of about 18%.
According to ACNielsen, the laundry industry in India was worth Rs7,908 crore in 2006 and rose 8.4% over 2005. HUL doesn’t report its laundry revenues separately but puts them under the soaps and detergent category.
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In 2006, HUL’s soaps and detergents segment contributed around Rs5,596 crore to the company’s total sales of Rs12,103 crore. “Laundry has been an attractive segment in the past and is likely to keep growing in the near future. The recent price war between companies led to erosion in their profitability but now, the industry is stabilizing,” says Unmesh Sharma, an analyst at Macquarie Securities here.
According to Vats, the laundry business is witnessing a surge in demand from cities and HUL is focusing on Tier I and II cities to tap that demand.
2)SUSTAINABILITY STRATEGY
We have a long-standing set of values and principles that guides our behaviour. These values underpin our approach to sustainability.
We have always been a business driven by a strong set of values. Today those values are as important as ever. We now know that the well-being of society and the environment is critical to our ability to grow.
Our Sustainability strategyUnilever’s vision is to double the size of its business while reducing the overall impact on environment. This new vision recognises that the world is changing, populations are growing and the rise in incomes is fuelling a growth in the demand for consumer products. Products like ours rely on an increasingly constrained set of natural resources, whether it is fuel, water, or other raw materials.
In Hindustan Unilever Limited (HUL), the principle of Corporate Responsibility (CR) is an integral part of our commitment to all our stakeholders – consumers, customers, employees, the environment and the society that we operate in.
Today, India is battling multiple issues like water scarcity, poverty, and problems arising out of low awareness of health, hygiene, and nutrition. If these issues are not addressed soon, they will create insurmountable barriers to business growth. We believe that helping society prosper and ensuring a sustainable future for the planet goes hand in hand with our goal of ensuring growth that is competitive, profitable, and sustainable for our organisation.
Our contributions have to be substantial and sustainable, which is why we are not just banking on our philanthropic programmes, but are transforming our core business practices as well. Even the seemingly small innovations in our brands and
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business processes can lead to a big difference in society as we touch the lives of two out of every three Indians.*
For example, if one household uses Surf Excel detergent, it can conserve two buckets of water per wash. A million Indian households using Surf Excel can save enough water for meeting the basic hygiene needs of many Indians. Thus, small individual actions multiplied with our large consumer base will make a big difference in combating the issues society faces.
We will further demonstrate that successful business strategies are driven by responsible business practices. The key to this approach is developing a CR framework which integrates the social, economic, and environmental agenda with our business priorities – growing markets, maintaining the competitive edge, enjoying goodwill in the communities we operate in, and building trust and an exceptional reputation. Hence, in the future, the three cornerstones for CR integration with business at HUL will be:
Growing markets responsibly: We will address issues related to hygiene and nutrition through product innovations and awareness. Gathering information about the concerns expressed by consumers, communities, and stakeholders can help us identify opportunities for innovation at the category, brand, and marketing plan level. We have a very strong and trusted position in India and we can leverage this to our competitive advantage.Ensuring sustainable practices in our operations:
To secure a thriving future, we need to establish sustainable sources for raw materials. Being a company that is heavily dependent on water, agriculture, fuels and petrochemicals, we must plan now for a future in which water could be scarce, agriculture could be under pressure, and fuels will be expensive. Our consumers add up to two-thirds of the Indian population, hence addressing sustainability issues is a high priority.
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Building a good reputation through responsible leadership:
CR is one of the key components of reputation and trust. A good reputation can be a major competitive advantage and can build employer brand and consumer loyalty.
3)Engaging with our stakeholders
Listening to others and learning from our stakeholders informs our decision-making, strengthens our relationships and helps us succeed as a business.
Stakeholder engagement for identifying issues that are material to us:
We appointed SustainAbility International to conduct stakeholder engagement on our behalf. They analysed and assimilated the expectations of stakeholders regarding issues that matter to them. These expectations were similar to the areas identified by us, where HUL's contribution could create a significant impact.
Scoping the areas for intervention
While the issues are many, it is necessary to address them in a systematic manner to make a real difference. Instead of spreading thin across all issues, we have chosen to work on five areas to ensure a deep impact.
These areas have been arrived at using the output from our stakeholder engagement process and areas which we are poised to address through our business.
Key messages from stakeholders
‘Target. Allocate resources. Achieve those targets. This is more critical than just being visible & talking about it.’
- ‘We feel that some Indian companies can be leaders in their respective sectors. HUL has the potential to be such a leader.’
- ‘Invest for your markets – don't do social work, it isn't your ballgame.’
- ‘Please make money out of it. When you make money out of it, things are going to change.’
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4)GovernanceWe aim to have strong governance structures in place to manage our social and environmental responsibilities carefully and thoughtfully.
Corporate Responsibility at HUL is led by the CEO and the Management Committee (MC) of the company. The MC governs the sustainability strategy with a view of key strategic approaches and seeks reports on impacts and efforts against clear targets.
Each of the nine cells (in the daigram shown in Sustainability strategy section) is owned by an MC member. For the execution of the strategy there is a team of 12 Sustainability Governing Council (SGC) members based on their respective functions.
Sustainability Governing Council
The Sustainability Governing Council is responsible for:
Recommending sustainability priorities for approval by the MC and monitoring its progress
Recommending HUL's positions on critical issues for approval by MC
Receiving stakeholder feedback
The role of the SGC is formalised, with a clear mandate and terms of reference outlining its mission, purpose, membership, meeting schedule, and reporting systems.
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External commentaryWe shared our sustainability strategy with leading external experts from diverse backgrounds. Below you can read their comments on our sustainability strategy.
View of leading external experts on HUL’s sustainability strategy
‘The long-term strategy and roadmap provides a comprehensive approach towards meeting future sustainability challenges, especially with respect to resources such as water and energy.’
- Shirish Sinha, Head Climate Change & Energy Programme, WWF
‘We are happy with the focus on linking the business processes with corporate responsibility. Social impact has to be central to business processes, which is brought about by HUL's strategy. Corporate responsibility via business strategies is the way forward.’
- Ibrahim H. Rehman, Director, Social Transformation Division, TERI
‘The tying up of your strategic threads is excellent. Ensure that you carry it through action!’
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5)COMPETATIVE STRATEGY
As Competition Heats Up, India’s Top Consumer-Products Company Woos Affluent Shoppers With Global Brands Like Dove, While Cooking Up Its Foods Biz
The middle-aged Briton strolling the aisles and checking out the products doesn’t attract much notice from other shoppers in Mumbai’s Hypercity, the India hypermarket chain. That’s how Douglas Baillie likes it. Baillie, the managing director of Hindustan Unilever, India’s premier consumer-products company, wants to see how his products are stocked, what consumers are buying, and how shoppers are reacting to competitive brands. It’s primary market research at its most elemental, and it’s best done incognito.
Hindustan Unilever has traditionally relied on small traders and mom-and-pop corner stores to retail its products. But India’s recent retail boom has created large stores and malls, so the company wants to make sure it’s in with the new marketing crowd. Hence Baillie’s Hypercity visits, and the calls he makes on the headquarters of the big retail chains.
This is quite a change for Hindustan Unilever, whose executives used to have emissaries make obeisance at Lever house in downtown Mumbai. “I can’t imagine any head from Lever House ever visiting other company offices like this,” says an amazed Damodar Mall, chief executive of innovation and incubation at Pantaloon Retail, India’s largest retailer and a former manager at Hindustan Unilever.
6)OTHER STRATEGY
Grow ahead of market by leading market development activites. leverage positive impact of growing Indian economy on consumer spending. Grow a profitable foods and top end business. Grow the bottom-line ahead of top line. Strong commitment to sustainable development.
SWOT ANALYSIS
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STRENGTHS
Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods company, touching the lives of two out of three Indians with over 20 distinct categories in Home & Personal Care Products and Foods & Beverages..
Due to its long presence in India – has deep penetration – 20 consumer product category, over 15,000 employees, including over 1,300 managers, is to "add vitality to life."
The company derives 44.3% of its revenues from soaps and detergents, 26.6% from personal care products, 10.5% from beverages, and the rest from foods, ice creams, exports, and other products.
Low cost of production due to economic of scale. That means higher profits and / or more competitioners. Better market penetration.
HUL is also one of the country's largest exporters; it has been recognised as a Golden Super Star Trading House by the Government of India.
Weakness
Strong competitors and availability of substitute products
Low export levels
High price of some products
High advertising cost
Opportunities
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Increasing per capita national income resulting in higher disposable income.
Growing middle class and growing urban population.
Increasing gifts cultures.
Increasing departmental stores concept – impulse @ at cash counters.
Globalization.
Threats
HUL's tea business has declined marginally, reason is that, cost pressure is likely due to rising crude and freight costs.
Tax and regulatory structure.
Mimic of brands.
Removal of import restrictions resulting in replacing of domestic brands.
Temporary slowdown in economy can have an impact on FMCG in Industry.
PEST ANALYSIS
P:
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since the budget range is decontrolled, no political effects are envisaged.
E: increasing per capita income resulting in higher Disposable income
Growing middle class/urban population – increase in Demand
Low cost of production – better penetration
S: Per capita consumption expected to increase – fashion
Increasing gifts culture – increase in demand T:
Will have to reinforce technology to international levels Once India is a “fully free” economy
MAJOR FINDINGS
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The Crisis of Declining Markets
Through the nineties, the FMCG markets grew at almost 15% per annum in value. Suddenly, in 2000, FMCG market growth stalled and then declined for the next four years. It is important to understand why this happened.
The rapid opening up of the economy resulted in many new avenues of expenditure for the consumer’s growing income.A sharp drop in interest rates from 18% to 8% led to explosive demand for consumer durables like white goods, two-wheelers and automobiles. After all, one could drive out of a car showroom in a Maruti 800 with a down payment of only Rs. 2000. The home ownership market grew exponentially as the average age of a home loan borrower dropped from 50 in 1999 to 30 in 2004. Mobile phone ownership and usage exploded due to its amazing lifestyle and convenience benefits as well as lower prices. Entertainment, Leisure and Travel sectors also boomed.
The lure of new avenues of expenditure in products and services led to consumers restricting their expanse on FMCG. It is not that they bathed less often or brushed their teeth less often or indeed washed their clothes less often. But they did downtrade to lower priced substitutes from higher quality brands. For example, a consumer buying six tablets of Lux in a month went to buying three of Lux and three cheaper brands. Or a consumer buying Surf Excel for her clothes mixed it with a cheaper powder. As a result of this shift in spending patterns, the FMCG market declined in value in the last four years creating a major challenge for growth.
The new Hindustan Lever:
Focused on FMCG In 2000, 75% of our sales came from FMCG businesses. The rest came from several non-FMCG businesses which were not profitable, and did not offer prospects for long-term leadership. Besides, they were a drain on the core FMCG business, both in terms of resource and focus.
They decided to disengage from all non-FMCG or commodity businesses. In all, we have divested and discontinued 15 businesses including Animal Feeds, Speciality Chemicals, Nickel Catalyst, Adhesives, Thermometers, Seeds, Mushrooms etc. with sales of Rs.1,750 crores as in 1999.
Today they are a focused on FMCG company with our branded business accounting for over 90% of sales, consisting of 35 brands across 20 categories. These will be their main engines of growth, with higher levels of resource concentration, be it technology, people talent or media spend.
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Building blocks of a strong Foods business
In Foods, there is enormous growth potential in leading the evolution of consumers to branded and processed foods. Over the last few years they have focused on putting in place the building blocks of a strong Foods business. Historically their Foods business was fragmented and lacked scale. It was often commoditized with low margins. They recognized that changing food habits would require considerable investment, which the current business simply could not afford. Therefore they divested the non-value added parts like Vanaspati. They have consolidated theuir portfolio and improved the gross margins by over 13% through product mix and cost reduction. They have also cleared the supply chain of all old stock and geared up for fresh availability on shelf.Today, their Foods business has a healthy gross margin and a supply chain driven by freshness. The Foods business will now invest for growth through relevant innovation.
FMCG still offers enormous potential
As the largest FMCG player it was up to them to reverse the downtrading to realize its true growth potential. They could achieve this by raising the bar and becoming world class in what their brands offered and how they worked. Nothing less would do.
Penetration levels in several of the categories and consumption levels in all of the categories is low by any comparison.Across the world, they are seeing a strong correlation between income levels and the size of FMCG markets.Over the next 10 years, per capita income in India is likely to touch China’s current levels. At those levels, the FMCG market will be over Rs.100,000 crores from a current value of Rs.40,000 crores. This is an opportunity that they have to seize.
Portfolio of Strong Brands
Their main challenge was to reverse the downtrading in the categories and re-establish the relevance of their brands in the mind of the consumer. In 2000, they had 110 brands, many undifferentiated and lacking scale. They chose to focus on 35 power brands covering all consumer appeal and price segments. They are already seeing the benefits. Six brands – Brooke Bond, Lifebuoy, Lux, Fair & Lovely, Rin and Wheel – have emerged as mega brands in the last five years, each with sales of more than Rs.500 crores.
Better Value
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The first step was to ensure that they offer world class quality and real differentiation backed by technology to give them the advantage over low priced competition. They have invested over Rs.400 crores, or 5% of sales, in the last three years to upgrade the brands. In several cases they reduced prices to make the brands more affordable. Better quality and more affordable prices have increased the value to the consumer. They have also launched several low unit size and price packs for single use to make the brands more accessible to all income groups. For example, they are the first to introduce a branded toothpaste in a tube at Rs.5 and a branded quality shampoo in a bottle at Rs.5.
Bigger Role in Consumers’ Lives
Perhaps the most significant change has been to move the brands beyond merely making functional claims to playing a bigger and deeper role in the lives of consumers. They had to move from selling a soap or a detergent to something far more important and central to the consumer’s life. How often have we heard someone say, “A soap is a soap is a soap!” Or indeed, “All detergents clean clothes as well”.
In the case ofLifebuoy, it was only when they associated it with the promise of health and protection against disease that it claimed a larger space in the consumer’s mind. It moved from being a mere soap to a health essential. Today Lifebuoy, their oldest brand, has grown at over 15% for the last three years.
Similarly, in the laundry market, Surf Excel went well beyond the benefit of ‘great clean’ by saving two buckets of water with every wash. Imagine the importance of that benefit to consumers in cities, who often get running water for only a couple of hours a day. Surf Excel is one of their fastest growing brands today.
Both Lifebuoy and Surf Excel have succeeded because they are relevant to two key concerns of the Indian housewife: family health and the scarcity of water.
In addition to the growing consciousness of health, consumers today are looking for ways to look good and feel good so that they can get much more out of life. In short, consumers are seeking Vitality in their lives. Their portfolio of 35 power brands is uniquely positioned to offer nutrition, hygiene and personal care benefits and thereby deliver Vitality.
Technology, the Key Differentiator
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Their brands and sound understanding of the local consumer are supported by a world class Research and Development capability. They have over 200 of the brightest scientists and technologists based in India.
Their recent reorganization leverages the talent pool from across 16 global technology centres, of which four are in India.In all, they have over 4,000 high quality minds across Unilever working relentlessly to provide new benefits that make a real difference to the consumers.
Winning with Customers
Hindustan Lever has historically had a strong bond with its customers. They have strengthened this and reinvented the way they manage their distribution channels and their customers. The sales structure has been transformed to leverage scale and build expertise in servicing Modern Trade and Rural Markets. They have also de-layered their sales force to improve the response times and service levels.
Their customers are serviced on continuous replenishment. This is possible because of IT connectivity across the extended supply chain of about 2,000 suppliers, 80 factories and 7,000 stockists. They have also combined backend processes into a common Shared Service infrastructure, which supports the units across the country. All these initiatives together have enhanced operational efficiencies, improved the service to the customers and have brought us closer to the marketplace.
Our Acorns: Investing in our Future
In the pursuit of growth, they have also begun to nurture some acorns for the future. These are both new businesses and new ways of engaging with consumers.
Their entry into Water Purifiers, through Pureit, shows great promise. Pureit delivers 100% protection against all water-borne diseases. It provides water which is as safe as boiled water, without needing electricity or continuous tap water supply. At 17 paise per litre, it is extremely affordable for the common man. They have launched it in Tamil Nadu and are fine-tuning all aspects of the business system before a phased national launch.
In urban India, Hindustan Lever Network (HLN) is their direct selling initiative selling a special range of products. It already reaches 1,400 towns with over 3 lakh consultants. Besides reach, HLN enables direct interaction with consumers and customises solutions for them to give them a complete brand experience.
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Our People & Organisation
They have restructured the company, integrating eight Profit Centres into two Divisions – Home and Personal Care (HPC) and Foods. The result is a simpler and leaner organisation, less hierarchical with fewer levels and greater empowerment. This has eliminated complexity and speeded up decision making. Today the company is far more youthful in attitude and spirit. There is greater openness and transparency.
The Transformation: Investment in the Future
To ensure that Hindustan Lever remains competitive in the long-term, they have made significant investments in product quality, pricing and marketing. As mentioned earlier, the investment in product quality alone has been in excess of Rs. 400 crores, or 5% of our sales.
In addition there has been the cost of defending their market position. Recently an international competitor attacked their laundry business led by a price reduction of as much as 50%. They acted with speed and determination leveraging all their past experience in India and internationally. They have been able to fully protect their market leadership and share, albeit sacrificing short-term profit. They made this necessary trade-off as market share is the best means of sustaining future profit. Over time, their stronger market positions will surely lead to greater long-term profit.
Despite these significant investments to strengthen the long-term competitiveness and the costs of defending the strong market position, they still remain one of the most profitable companies in the country.
FIVE P’S OF MARKETING
Product
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Satisfaction suffices. But delight dazzles the average company will compete for customer by conforming to her expectation consistently. But the winner will surpass them by constantly exceeding her expectation, delivering to her door step additional benefits which she would never have imagined possible. Hindustan Unilever Ltd(HUL) offer such product. The wide variety products offered by the company include:
Make no mistake. Second P of marketing is not another name for blindly lowering prices and relying on this strategy alone to increase sales dramatically.
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The strategy used by Hindustan Unilever Ltd(HUL) is for matching the value that customer pays to buy the product with the expectation they have about what the production is worth to them.
Hindustan Unilever Ltd(HUL) has launched various products which cater to all customer segments. So every customer segment has different price expectation from the product. Therefore maximizing the returns involves identifying right price level for each segment, and then progressively moving through them.
Physical Distribution –
“Place” BRAND ISN’T THE ONLY ANY MORE.Marketers and finance manager need a new term to evaluate their business:
Distribution Equity. It takes much more time and effort to build, but once built, distribution equity is much together to erode.
The fundamental axiom of Indian consumer market is this:
You can set up a state-of –the-art manufacturing facility, hire the hottest strategies on the block, swamp prime television with best Ads, but the end of it all, you would be know of selling your products. The cardinal task before the Indian market is managing is to shoe-horn its product on retail shelves. Buyers are paying for distribution equity not brand equity and market shares.
Why does the company need distribution equity more anything in India? With technology and competitive pressure slash in it is becoming increasing difficult for marketers to retain a unique product differentiation for ling period. In a product and price parity situation, the brand that sells more is the one that reaches the highest number of customers.
India – The operations involve over 2,000 suppliers and associates. HUL's distribution network, comprising about 4,000 redistribution stockists, covering 6.3 million retail outlets reaching the entire urban population, and about 250 million rural consumers.television has already primed and population for consumption, and the marketer who can get to the to the consumer ahead of competition will give a hard – to – overtake lead.
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But getting their means managing wildly different terrains-climate, language, value system, life style, transport and communication network. And your brand equity isn’t going to help when it comes to tackling these issues. Own distribution network consist of clearing and forwarding (C&F) agents & distribution stockiest. This network of distribution can either contact wholesalers and which in turn retailers or the distributors can contact to the retailers directly. Once the stock product reaches retailers, the prospective customers can have access to the product. Hindustan Unilever Ltd(HUL) distributes the product in the manner stated above.
Hindustan Unilever Ltd(HUL) distribution network has expanded. Beside use of improved logistics, Hindustan Unilever Ltd(HUL) is also attempting to improve the distribution quality. To address the issue of product stability, it has installed visi colors at several outlets. This helps in maintaining consumption in summer when sales usually drops due to the fact that the heal effects product quality and thereby off takes.
Looking at the low penetration of few products, a distribution expansion would itself being incremental volume. The other reason is arch rival Procter & Gamble Co. reaches more than a million retailers. This increase in distribution is going to be accompanied by reduction in channel costs. Hindustan Unilever Ltd(HUL) marketing costs, at 18% of total costs, is much higher than Procter & Gamble Co. The company is looking to reduce this parity level. At Hindustan Unilever Ltd(HUL), they believe that selling FMCG is it like selling soft drinks.
Promotion
If an advertisement is to communicate effectively, the receiver must at least half want it to, and be prepared too take step toward the sender. Effective advertising is rarely hectoring or loudly explicit…. It often both attracts and generates arm feelings. More often than not, a successful campaign has a stronger element of the unexpected a quality that good advertising shares with much worthwhile literature.
To penetrate into the inner recesses of her memory, communication must first ensure exposure, grab her attention evoke her comprehension, grab her acceptance and then extract retention competing with thousands of other units of communication trying to do the same.
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Finding showed that the adults felt too conscious to be seen consuming a product actually meant for children. The strategic response address the emotional appeal of the band to the child within the adult.Naturally, that produced just the value vacuum that Hindustan Unilever Ltd(HUL)was looking to fill.
Thereafter it was the job of the advertising to communicate customer the wonderful feeling that he could experience by re-discoursing the careful, unself conscious, pleasure – seeking child within himself – a graft these feeling onto the Ad campaign like “hasso to khul k hasso for close up”, “cream bathing bar for dove soap” and daag ache hai for surf excel” have been sure shot winner with the audience.
It has also launched Pureit, a home water purifier which supplies drinking water without boiling/need of electricity , As well as outdoor and radio ads, ad agency contract has created communication for cinemas and even ATM machines for the brand.
All ICICI’ s ATM a message flashes on the screen as soon as customer insert his ATM card. Something familiar is planned for phone-book as well. In cinemas, Hindustan Unilever(Ltd)has a message on-screen just before the lights are dimmed to give them a chance to get their product There will also be after dinner sampling in restaurants – to begin with, 30 catteries in Mumbai have been selected. Ad spend in 2000 was about 14% of sales and the management said that plans to maintain as spend at this level in the current year also.
And since any discussion today would be incomplete without mention ‘e’ word, the management plans to tap this new channel of marketing. Beside the company website (i.e. www.unilever.com), that the company has launched, it had also entered into various marketing relationship with other portals, specially targeted during festivals and events such as Valentines day, etc….
It’s a combination of spiffing up its key brand, researching and improving the newer products that haven’t taken off,supported with high ad – spends that Hindustan Unilever(Ltd) hopes will see it emerges stronger after the current slowdown, as well as expand the market.
Positioning
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In the 1970s consumers were ready to pay “more for more”, and luxury goods flourished. In the 1980s, consumers began to demand “more for same”, and the discounting era grew strong. Today’s consumer demanding “more for less”, and the winner will be that super value marketers…. Some of today’s most successful companies recognize those customers are more educated and able to recognize true customer value…
Positioning is simply concentrating on an idea – or – even a word defines that company in the mind of the consumer. It is more efficient to market one successful concept to one large group of people than 50 product or service ideas to 50 separate group
Positioning is a must when customer attitude have changed and product have strayed away from the consumer’s long standing perception of them… Hindustan Unilever(Ltd) is an anchor in sea of consumer products. As a variety of competitive claims assails her senses, today customer uses complicated decision making process to assess the alternative before making a purchase.
Since Hindustan Unilever(Ltd) is more clearly associated with a particular set of attributes in terms of benefits and prices, the quicker becomes her search process. Positioning of individual product:
Lifebuoy is ‘one of Unilever’s oldest brands’ with more than a hundred-year history, as www.unilever.com informs. “Lifebuoy has become more than just a red bar of soap – today the brand provides hygiene and health solutions for families
Fair & Lovely, a hot-selling “fairness” cream, which promises a lighter skin tone for many of India’s complexion-conscious consumers
HINDUSTAN UNILEVER’S MARKET SEGMENTATION
Market place for any product is comprised of many different segments of consumers, each with different needs and wants. Markets segmentation can be defined in a number of ways such as:
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Demographic variables (e.g. Consumers are groups, gender, material states income etc…)
The lifestyle of consumers (i.e. their interests and activities) the benefits which consumers look for in a product or on the occasions when the product might be consumed.
Hindustan Unilever(Ltd) takes into account all these factors when producing a range of products. It targets different segments within the market, such as the:
Break segment – products which are normally consume as a snatched break and often with tea and coffee.
Impulse segment – these products are often purchase on impulse, used these and then. They include product such as close up.
Take home segment – this describes product that are normally purchased in supermarkets, taken home consumed at a later stage.
AN UNMATCHED BRAND PORTFOLIO
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DIVERSIFICATION OF HINDUSTAN UNILEVER LIMITED
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HOME CARE PRODUCTS:
Surf Excel was introduced in 1959. It is apioneer in the Indian detergent powder market, Surf Excel has constantly upgraded itself over the years, to answer the constantly changing washing needs of the Indian homemaker. Today Surf Excel offers outstanding stain removal ability on a wide range of stains. Surf Excel quick wash is powered with a path-breaking technology- it reduces water consumption and time taken for rinsing by 50%. It is a significant benefit, given the acute water scarcity in most of India.
VIM BAR
Created in 1885, the Vim brand is still innovating and using the magic of natural ingredients to create unbeatable results over a hundred years later.
Key Facts
Vim was the original hand dishwashing brand: so we invented the whole category!
Vim is sold in four continents, is the leading hand dishwashing brand in twenty countries, and is available to more than 2 billion people around the world.
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Vim began life as a soap (both in England, and in Thailand, where King Rama V asked Unilever to supply his household with soap), but is now available as a complete range of hand dishwashing – including bars, powders and liquids.
Cif- The World’s leading cream cleaner which gives you the power to deal with the toughest dirt is now in India.
Key Facts
Cif is the number 1 cream cleaner in the World.
It is the number one cleaner in various countries including France, Germany, Russia.
It’s a 500 million Euro Brand.
Cif is Sold in 51 countries around the globe.
Food brandsHUL is one of India’s leading food companies. Our passion for understanding what people want and need from their food - and what they love about it - makes our brands a popular choice
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In the year 1962, Brooke Bond India creates the branded roast and ground coffee segment launching Deluxe Green Label. 1968 gave birth to the first instant coffee chicory mix under the brand name Bru.
Key Facts
Number 1 Coffee brand in India
Unilever's only Coffee brand
Enjoys a rich heritage, came into existence in 1962 under the brand name Deluxe Green Label
Consistently offering better and newer products to the consumer through improved packaging solutions and innovative product formats
Enjoys a strong presence at various out of home locations
Unilever is the world's biggest ice cream manufacturer, operating under the Heartbrand.
Heartbrand products are sold in more than 40 countries worldwide and has an annual turnover of €5 billion
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Also sold as Algida in Italy & Turkey, Langnese in Germany, Kibon in Brazil, Streets in Australia and Ola in the Netherlands
TAJ MAHAL
Taj Mahal was launched in 1966 by Brooke Bond.
Taj Mahal is the most premium brand of tea in the Indian market.
It was the first brand to launch tea bags and is the only tea brand in India to be sold
in Vacuum sealed packs.
Since 2006, Saif Ali Khan is the brand ambassador.
Personal care brandsOur personal care brands, including Axe, Dove, Lux, Pond's, Rexona and Sunsilk, are recognised and love by consumers across India. They help consumers to look good and feel good – and in turn get more out of life.
Launched first in the US in 1957; is one of the leading brands of Unilever globally.
Dove has its footprint in 80 countries worldwide with a range of superior products from bar, lotions, body washes, face care and creams.
It is the leading bar brand in UK, US and Canada.
Fastest growing hair category brand in India
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LAKME
Lakme was the first major beauty brand in India and takes pride in being the expert on Indian Beauty for over 50 years.
It is complete beauty brand spanning colour cosmetics, skin care & hair styling products and extending to beauty services through the network of Lakme Beauty Salons.
Its bond with beauty and fashion is manifested through the Lakme Fashion Week, which is now the largest fashion event of its kind in the country.
Lakme has a foot print of over 1200 assisted sales outlets, which is the largest span of outlets with “Beauty Advisors” in the country.
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Lifebuoy, an undisputed market leader for 112 years, has a compelling vision “to make 5 billion people across the world, feel safe and secure by meeting their personal care hygiene & health needs”
Key facts
Undisputed Leader in the soaps market of India, with 18.4% share.
Turnover of €350 million a year globally, € 200 million in India.
Has a consumer base of 140 Million households in India
The iconic jingle of Lifebuoy – “tandrusti ki raksha…..” is almost like the health anthem of India and Indians
Recent Awards:Voted in the top 10 most trusted brands in India in the “Brand Equity Survey” (came in at No. 9 in 2008 as well)Marketing excellence awards for its recent innovations and activations:
o “Gold” at the Emvies 2008 for best use of media innovation
o ASIA Pacific CSR Award 2007, for Lifebuoy Swasthya Chetna
WATER
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Pureit is the world’s most advanced in-home water purifier. Pureit, a breakthrough offering of Hindustan Unilever (HUL), provides complete protection from all water-borne diseases, unmatched convenience and affordability.
Pureit’s unique Germkill Battery technology kills all harmful viruses and bacteria and removes parasites and pesticide impurities, giving you water that is "as safe as boiled water". It assures your family 100% protection from all water-borne diseases like jaundice, diarrhea, typhoid and cholera. What’s more, it doesn’t need gas, electricity or continuous tap water supply.Pureit not only renders water micro-biologically safe, but also makes the water clear, odourless and good-tasting. Pureit does not leave any residual chlorine in the output water The output water from Pureit meets stringent criteria for microbiologically safe drinking water, from one of the toughest regulatory agencies in the USA, EPA (Environmental Protection Agency).
PRODUCT INNOVATIONS
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Clean clothes, less waterRinsing clothes is the most water- and time-consuming part of hand washing. How are we helping?
Helping hand wash
In India, our laundry detergent Surf Excel is used mostly for hand washing. When washing clothes by hand, it’s rinsing that often takes most time and uses most water – water that is extremely scarce, especially if you live in the dry, southern states of Andhra Pradesh and Tamil Nadu.
Understanding the problem
We were asked if we could improve Surf Excel so less rinsing is needed, while still getting clothes as clean as before. This is the challenge our innovation team took up.
First we had to understand the hand wash process really well. Typically people keep rinsing till all the lather has gone. That often takes four rinses, which means four buckets of water.
We knew we could 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 we also know that people like the foam when they’re washing because it’s a sign that things are getting clean.
Reduced rinsing
So we had to find just the right ingredient that doesn’t suppress lather significantly during the main wash, yet aids significant foam reduction during the rinsing step. We tested several until we found one that doesn’t kick in until the concentration of surfactant active is lower – in other words when washing is complete and rinsing begins - then rebalanced the formulation until we got it just right.
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This is how new 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.
We have supported the launch of Surf Excel Quick Wash with an advertising campaign that promotes the message that you can have cleaner clothes with less lather with the aim of helping to reduce the water used in washing even more in the future.
Knorr: a revolution in stockKnorr helps home-cooks provide natural and nutritious meals for their families in a
convenient way.
Closer to home
By interacting closely with consumers, we realised that the jelly format of Knorr Stock Pot is very close to home-made bouillon in how it looks and smells and how you use it. Unilever chefs and product developers worked closely together to cook and stabilise, in a natural way, rich bouillons with big and fresh pieces of vegetables and herbs. We have applied for patents around this innovative technology.
Knorr Stock Pot is easy to use and melts naturally into food, developing a great aroma and taste, while keeping the salt dosage in the end dish flexible. The protected packaging locks in the goodness of the bouillon, requiring no artificial preservatives.
Global launch
Consumers around the world are enjoying Knorr Stock Pot. The first country to launch in 2007 was China, where there was no bouillon cube market, and soup-consumption is very high. Chinese home-cooks love the convenient way to create the dense soups their mothers and grandmothers made. Now, home-cooks in the UK, Ireland, France, Spain, Belgium, Greece and many countries to follow are
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expanding their repertoire and creating wonderful, wholesome dishes for their families.
Pioneering technology for Magnum TemptationSince its launch in Europe in the early 90s, Magnum has grown to be one of Unilever’s biggest brands, bringing real chocolate indulgence to the adult ice cream market. However it became widely imitated and there was a need to re-establish both its superiority and leadership.
The idea
In line with the consumer trend for experiencing greater sensory pleasure, we decided to launch a new product platform that delivered a premium and complex experience – the ‘blow me away’ concept. This would allow the more discerning consumer to trade up to a super premium level compared with the core range of Magnum.
Different challenges
The total offering required a step change in the visual, tactile and organo-leptic experience. In other words, a unique new sensual shape, perfect finish on the chocolate coating and exceptional ice cream quality.
We wanted to incorporate the highest ever levels of inclusions. For instance, one would have sauce combined with chocolate and brownie chunks. Another, almond
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pieces smothered in chocolate and caramel sauce. And we wanted it delivered in an impulse format, by which we mean ice cream on a stick rather than in a tub.
All of this demanded inspired creativity from our ice cream R&D experts.
New technology
We developed a new forming process based around continuous extrusion that allowed us to shape in three dimensions whilst dosing the inclusions. Evolved over a decade by the team at Colworth, this pioneering cold roller technology was set to revolutionise the stick format.
Extensive testing included a continuous 3-day production trial. We also had to secure patents, design registrations and freedom to operate agreements. To deliver this innovation on time and in full required outstanding collaboration between R&D, Brand Development, Supply Chain and all support functions.
Packaging design
Developed through Open Innovation with a strategic partner, the novel and visually attractive packaging is integral to the premium nature of the concept. Smart design struck the right balance of minimal environmental impact through renewable material use with effective product protection. What’s more, it establishes a consumer ritual: remove the seal and open the box to reveal the naked product on a soft cellulose inlay, surrounded by the ‘gold’ inside of the carton. Reminiscent of a jewellery box in function and graphic design, each variant has its own signature colour within the carton.
In-market results
In 2007, we launched Magnum Temptation in Italy, Spain and Switzerland. In 2008, we went into the rest of Europe with a dark chocolate variant. In 2009, we expanded capacity and introduced a fruit variant to cover the range of consumer preference.
As a breakthrough innovation Magnum Temptation has achieved the expected success delivering incremental sales. This means that it did not impact the sales of the core range. The products are now being rolled out across the world.
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Intelligent deodorantOur Rexona deodorant uses body-responsive micro-capsule technology that kicks in when it’s needed most, giving people the confidence to face the day's more stressful situations.
The challenge
Instances of stress – whether expected or unforeseen – can make people sweat more than usual. However, at times like these most deodorants can’t cope. Our challenge was to develop a product that offered extra protection at such moments, delivering additional freshness and giving consumers the confidence that comes from knowing they look in control.
Responsive technology
Since deodorants deal primarily with physical sweat, we set about developing a technology that could also cope with emotional sweat. In partnership with key suppliers, our scientists developed a new anti-perspirant – Rexona Activreserve – whose special micro-capsules of odour protection are activated when the body responds to stressful situations.
These capsules sit on the skin’s surface. When pressure or stress cause a sudden, uncontrollable burst of sweat in the underarms, the sweat dissolves the capsules giving extra odour protection when it’s most needed. So whether an individual is sweating a lot or a little, the technology will always release the right amount of protection.
Smoother, straighter hair
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There’s a good reason why sunsilk is the number one hair care brand in Asia, Latin American and the Middle East, and the fastest-growing in Europe - tip-targeting technology.
Smooth & straight without heaviness
We recently launched a new sunsilk Silky Straight and Smoothing range especially for those of you looking for a smooth, sleek and straight look. We saw that older products out there sometimes just made hair look heavy and greasy, instead of naturally silky.
Technology that knows the difference
So we focused our research on why, and what we could do about it. From our extensive research on hair fibres, we know that the roots and tips of our hair have different surface chemistries that, ideally, require slightly different treatment - not an easy thing to do standing under the shower in a hurry to get to work.
Acting where it is needed?
We developed a new technology that – within one shampoo – can target conditioning actives to go to work where they are needed most. A bifunctional polymer, possessing one domain that attaches to droplets of conditioning active and a second domain that seeks out weathered or damaged hair, is used. Conditioning droplets, covered by these polymers, deposit preferentially where conditioning is needed – typically the tips – smoothing kinks and frizz and helping to naturally weight your hair to look silky straight.
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Now we also have a Sunsilk Silky Straight conditioner and a Straightening Cream, all helping your hair to look naturally smooth and sleek, root-to-tip, without heaviness or greasiness. To help you look good, and feel good.
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ANALYSIS AND INTERPRETATIONS
MARKET SHARE OF FMCG COMPANIES IN INDIA
34%
29%8%
6%
4%
19%
hulitcnestlebritaniadaburothers
In the above pie charts we see the position of various FMCG companies doing business in india . we can see that HUL is enjoying the position of market leader and is following by ITC as close second in the market share of FMCG products.
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MARKET LEADER-HINDUSTAN UNILEVER LIMITED
fabric
wash
personal
wash
dishwash ski
n
sham
poo
talcu
m powder
packet
teaco
ffeejam
s0
10
20
30
40
50
60
70
80
37.5
54.357.3
54.547.8
69.7
22.7
44
67.5
13.69.7 8.7 7.4
23.7
14.520.8
39.1
3.4
hulcompetition market share
As mentioned in the above graph ,hul is enjoying the leader position in the market and is having highest market share which are followed by the market challengers like dabur india ltd , nestle,itc etc. in different categories of fmcg products like shampoos deos, coffee, dish wash etc.
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HINDUSTAN UNILEVER LIMITED-COMPETITORS
toothpaste ketchups0
10
20
30
40
50
60
29.5 28.1
48.8
30.3hulcompetition market share
In some category market challengers are giving high level competition in different product lines such as ketchup and tooth paste.
So we can see that in overall FMCG business HUL is distantiy ahead of rest of the companies as far as market share of different product are concerned
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CATEGORY WISE SALE GROWTH OF FMCG SECTOR OF HUL IN IN INDIA
CATEGORY PERCENTAGE
SOAPS AND DETERGENTS 19.3%
PERSONAL PRODUCTS 22.4%
ICE CREAM 15.7%
PROCESSED FOODS 13.7%
BEVERAGES 13.6%
OTHERS 19.4%
19.30%
22.40%
15.70%13.70%
13.60%
19.40%
SOAPS AND DETERGENTSPERSONAL PRODUCTSICE CREAMPROCESSED FOODSBEVERAGESOTHERS
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PORTFOLIO STRADDLING THE PYRAMID ACROSS CATEGORIES
Particulars Laundry Soaps Shampoo Skin Toothpaste tea CoffeeMarket size-$ mln
2247 1658 542 698 691 1113 177
Hul share 37.5% 54.3% 47.8% 54.5% 29.5% 22.7%
44.0%
Nearest competitor
13.6 9.7 23.7 7.4% 48.8% 20.8%
39.1%
AFFLUENT
ASPIRING
STRIVING
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CATEGORY LEADERSHIP: LAUNDRY
2002 2003 2004 2005 2006 2007 2008 200932
33
34
35
36
37
38
34.534.1
34.334.5
35.2
36.5
37
37.5
LAUNDRY MARKET SHARE
As mentioned in the above graph ,hul is enjoying the leader position in the market and is having high market share in home care products.
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BUILDING CATEGORY:PROCESSED FOODS
LARGE SNACKING MOMENTS low ketchup penetration
SNACKING INCIDENCE
SNACKS %HHLDS
POTATO CHIPS
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MIXTURE 43
BHAJIYA 27
MURI(EAST) 27
jan-mar apr-jun jul-sep oct-dec24
24.5
25
25.5
26
26.5
27
27.5
28
28.5
26
25.5
26.9
28.1
Series 1
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NORTH 21%
SOUTH 7%
EAST 25%
WEST 16%
METROS 31%
STRONG GLOBAL BRAND : DOVE
MAY JUNE JUL AUG SEP OCT NOV DEC0%
10%
20%
30%
40%
50%
60%
70%
Series 1
As mentioned in the above graph ,hul is enjoying the leader position in the market and is having high market share in personal care products. Dove is a global brand and used by million of customers,due to various innovations made it is becoming famous among teenagers and the sales is constantly increasing.
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MARKET SHARE OF HINDUSTAN UNILEVER – SKIN CARE PRODUCTS
45%
25%
20%
5%5%
Sales
HULNIVEAGARNIERAYUREMAMI
As mentioned in the above graph ,hul is enjoying the leader position in the market and is having high market share in personal care products.nivea and garnier are strong competitors of hul in skin care products to stay ahead it has to do advertisements and give various promotional offers.
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FINANCIAL OVERVIEW
2009 2008 2007
REPORTED GROWTH
13.3% 9.4% 11.4%
CONTINUING SALES GROWTH
13.5% 10.0% 11.5%
EBIT/SALES% 14.4% 14.1% 13.3%
EBIT GROWTH 15.4% 16.2% 1.1%
OPERATING CASH FLOW
$365MN $489MN
HUL FMCG SALES GROWTH%
2002 2003 2004 2005 2006 2007 2008 20090
2
4
6
8
10
12
14
SALES GROWTH%
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EBIT MARGIN
2002 2003 2004 2005 2006 2007 2008 20090.00%
5.00%
10.00%
15.00%
20.00%
25.00%
13.20%
15.50%
19.30%20.10%
14.70%13.30%
14.10% 14.40%
Series 1
HUL EARNING PER SHARE
2002 2003 2004 2005 2006 2007 2008 20090.00%
5.00%
10.00%
15.00%
20.00%
25.00%
14.60%
18.30%19.70% 19.90%
13.30%
15.70%
20.60%21.40%
Series 1
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RETURN ON CAPITAL EMPLOYED
2002 2003 2004 2005 2006 2007 20080
10
20
30
40
50
60
70
53.8 52.8 51.8 53
40.8
62.3 61.1
Series 1
RETURN ON NET WORTH
2002 2003 2004 2005 2006 2007 20080
10
20
30
40
50
60
70
80
90
52.7 53.948.4
82.8
57.261.1
68.1
Series 1
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HINDUSTAN UNILEVER LIMITED – PROJECT SHAKTI
Shakti is our initiative that combines social responsibility, sustainability, and business strategy. India has more than 6,30,000 villages, most of these are 'hard to reach' and offer relatively lower business potential. Hence, reaching them through the conventional distribution system is a challenge.
In 2000, we collaborated with Self-Help Groups (SHG) to extend our rural reach. We partnered with the SHGs by offering them opportunities for business. By promoting micro-enterprises, our initiative not only makes great business sense, but also has a deep social impact. The business objective is to extend our direct reach into untapped markets and to build brands through local influencers. The social objective is to provide sustainable livelihood opportunities for underprivileged rural women.
On an average, a Shakti entrepreneur earns INR 700 - 1000 a month, and since most of them live below the poverty line, this earning is significant, often doubling the household income.
Shakti started with 17 women in two states. Today, it provides livelihood enhancing opportunities to about 45,000 women in 15 Indian states and provides access to quality products across 100,000+ villages and over 3 million households every month.
Project Shakti contributes to 10% of rural turnover nationally. In most Shakti markets,we are dominant and enjoy a market share which is qualitatively better as compared to non-Shakti markets.
Shakti is not only a channel for increasing our reach, the Shakti entrepreneurs are also brand ambassadors for all HUL brands in rural India. Their relationship with consumers is forged by their home-to-home contacts, and goes a long way in building brand loyalty.
Our Shakti initiative can be described in many ways – as a sales and distribution initiative that delivers growth; a communication initiative that builds brands; a micro-enterprise initiative that creates livelihoods; and a social initiative that improves the standard of life in rural India by providing quality products. What makes Shakti scalable and sustainable is the fact that it contributes not only to our business, but also to the community it is a part of.
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HINDUSTAN UNILEVER LIMITED: CREATING A POSITIVE IMPACT ON THE SOCIETY
Creating a positive impact
We believe that the true worth of an organisation comprises more than just its business achievements. The service it renders to society bestows great value on the organisation itself. We are committed to creating a responsible leadership that has a positive impact on society, and helps solve its most challenging issues.
In 2009, HUL contributed INR 30 crores towards community related initiatives. Our contribution in 2009, went either to long-term community investment partnerships or to commercial initiatives, with mutual benefits for both our business and our partners.
The United Nations reports that people need a minimum of 50 litres of water a day for drinking and other basic needs. In India, more than 50%of the population lives on less than 10 litres of water a day. Approximately 70% of the total water is consumed by the agriculture sector. India is an agri-economy, and as its population grows, there will be an increase in water consumption by the agriculture sector. These issues are likely to be exacerbated by climate change, making access to water an issue for farmers and society.
What we do
We have identified water conservation as an issue we would like to focus our energies on. We are working in close partnership with our stakeholders to conserve precious drops of water. Water management has been a key area of focus for HUL across the entire value chain.
We are also engaged in community projects to conserve water. We aim to conserve more than 20 billion litres of water by 2015.
WaterWe will conserve water by working on a wide range of locally relevant initiatives and partnerships for water conservation and spread awareness about the issue amongst our consumers and communities.
We are working with specialised NGO partners in the field of water conservation, and use various models with specific performance indicators and evaluation procedures. We began this journey seven years ago to build our learning. Since
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then, we have been engaged in successful projects on water conservation across different terrains in India which face acute shortage of water.
Successful water conservation pilot projects
Project KhamgaonSeven years ago, our team from the Khamgaon factory started a pilot watershed management project, on a five hectare plot, to prevent soil degradation and to conserve water. The selected area was located in a dry and arid region of Maharashtra. The efforts have resulted in the creation of a green belt, which is now a veritable forest with about 6,300 trees. Encouraged by the results, we extended the model to a neighbouring village, Parkhed, in association with The Energy and Resources Institute (TERI) and BAIF Development Research Foundation. The community at Parkhed constructed 47 percolation bunds, 1,600 trenches, 6,000 running metres of continuous contour trenching over 100 hectares and five permanent check dams. More than 350 families are reaping the second crop, which is made possible by the check dams.
The total land under cultivation during the second crop season is approximately 470 acres. The annual income of the farmers in the vicinity of the five check dams has increased from an average of
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INR 36,000 to approximately INR 85,000, per farmer. This success has been attributed to the availability of well water during the Rabi season and an increase in the water level during the Kharif season. Hence, along with reaping a Rabi crop, the farmers have also been able to almost double the yield of the Kharif crop. This initiative received appreciation at the Johannesburg World Summit on Sustainable Development.
Project SilvassaIn April 2004, Vanarai and HUL started a project in Karchond and later in Dapada, Pati, Sindoni, and Silvassa. Till March 2010, the project has made an impact on water and soil conservation. The project has ensured sustainable development of water and land resources, locals have attained self-sufficiency in basic needs of food, water, fodder and fuel, and local employment opportunities have been generated through increased economic activity.The other highlights are: - More than 67 million litres of water have been harvested since 2004 - Additional income of INR 160 lakhs was accrued to villagers during project period - 325 families have benefited under various programmes, 130 families now have access to the public toilet facility - Soil conservation treatment has been carried out on 282 hectares of land - 12,000 mango seedlings have been planted - 22 bore wells and 20 open wells were recharged
Project Puducherry In 2008-09, HUL's Puducherry unit partnered with DHAN Foundation, Madurai and identified eight village ponds for renovation to enhance the water availability. One of the unique aspects of the project was to form social capital by organizing villagers into pond association and empower them to execute the physical renovation work. The pilot project has improved water availability in eight village ponds by harvesting monsoon run-off. Rainwater harvesting storage of 22300 cu. meter has fulfilled the multiple domestic needs of 4519 households in eight hamlets and 346 acres are now irrigated due to the rejuvenation of ground water.
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LivelihoodsEnhancing livelihoods has been another area where we have built partnerships to make a difference.
We have developed innovative distribution channels, like Shakti, based on micro-enterprise models as part of our business process. We have also implemented community initiatives to enhance livelihoods with NGO partners, such as:
- Enhancing livelihoods of 75,000 poor women in partnership with DHAN Foundation - Enhancing livelihoods in Dadra & Nagar Haveli through vocational training for 1080 tribal youth. This programme was to complement and expand our impact in the region through the existing water conservation project.
Project in partnership with DHAN Foundation
75,000 women from rural, urban, tribal, or coastal areas in the south were given information on how to pool in their own savings, access bank resources and identify commercial activities based on their skills and local market potential. Their activities moblised more than INR 52 crores and generated an incremental income of INR 18 crores.
Project in partnership with Aide et action
With Aide et Action we have set up iLEAD centers for the youth in Silvassa, offering vocational courses like tailoring, basic knowledge about computers, electrical wiring, etc.
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As of now, 60% of the trained students have been successfully placed in different organisations in the region. Young women like Vimala Chatta, who is a Class 2 dropout, today earns INR 3000 a month because of the tailoring skills she picked up in an iLEAD course.Deepak Pargi learnt how to use Photoshop and started his own photo studio at Surangi.
The short term courses offered by iLEAD are attuned to the demands and needs of the industry leading to more relevant employment opportunities, thus leading to higher returns. This is a win-win model for local communities and businesses. What is remarkable is that the youth from the iLEAD programme are pitching in by mobilising new trainees, and providing necessary counselling about taking up jobs outside their village through an alumni association they set up! Youngsters are also given necessary space and advice when they want to establish their own enterprises.
Other Community initiatives
Providing healthcare
Sanjivani Mobile Medical Facility:We started Sanjivani, a mobile medical service in 2003, to offer effective medical care in villages surrounding our Doom Dooma factory in Assam. The objective has been to meet the basic medical needs of people living in the remote villages in Assam through a free mobile medical facility.Apart from basic medical services, Sanjivani also spreads awareness about hygiene, child immunisation, family planning etc. The project covers a radius of 40 km around the factory with two mobile vans equipped with basic medical equipment and a specialised team comprising one male and one female doctor, two nurses, a medical attendant and drivers. On an average, 400 Sanjivini medical camps are conducted every year in remote villages surrounding our factory. The project is run in close co-ordination with the local administration and its progress is reviewed every quarter.
Assisting women through education
Fair & Lovely Foundation:Scholarships of up to INR 1 lakh have been awarded to those women who do not have the financial strength to realize their dreams, but
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have the aptitude, drive, and ambition to carve a place of pride for themselves in society. The scholarship which was awarded only to postgraduate studies has now been extended to graduate students as well. Since 2003, more than 790 scholarships have been awarded to women across India.Disaster relief and rehabilitation
Floods, Bihar, 2008:We contributed 10,000 kits worth INR 60 lakh as the first installment of material for immediate relief of the flood affected families in Araria District in Bihar. The kit contained essential items such as utensils, clothes, blankets, and other useful material.In all, 12 truckloads of material were distributed to the affected families under the guidance of the Araria District Magistrate. A sum of INR 84 lakh was contributed by HUL and our employees to rehabilitate the underprivileged amongst the flood-affected families in the village of Jorgama, Madhepura district, Bihar. The project aims at theconstruction of 100 disaster proof houses for the purpose of rehabilitation.
Tsunami, South India, 2006:We contributed over INR 10 crores towards the relief and rehabilitation of tsunami-affected families by way of providing relief material, land, and construction of facilities. We distributed nutritional and personal hygiene products worth INR 5 crores for immediate relief to the needy soon after the tsunami hit the region. Later, pursuant to a request from the Government of Tamil Nadu about the urgent need for housing the affected families, we donated 5.27 acres of land (market value on a conservative basis is INR 4.5 crores) at Tondiarpet, Chennai, to the government. The complex has 960 permanent houses spread over 5.27 acres of land. Our employees also made a contribution of INR 50 lakhs which was used to construct the facilities in the complex.Caring for the vulnerable
Asha Daan:In 1976, HUL provided a 72,500 sq. ft plot for setting up Asha Daan in the heart of Mumbai. This home is supported by the Missionaries of Charity and cares for abandoned and challenged children, victims of HIV, and the destitute. We bear the capital and revenue expenses for maintenance, upkeep, and security of the premises.
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Awards & recognition
These are some highlights of recognition we have received from external bodies on our social, economic and environmental performance during 2009 and 2010.
Awarded top Indian company in the 'FMCG' sector for the third consecutive year at Dun & Bradstreet-Rolta Corporate Awards, 2009
HUL ranked fourth in the ‘Top Companies for Leaders, 2009' (Asia Pacific region) and 10th place in the global rankings in a survey carried out by Hewitt Associates
HUL received the Award for Excellence in HR in 2010 from Confederation of Indian Industry (CII). This is a rigorous fact-based assessment which is conducted by a team of external assessors. HUL has won this award for the third consecutive year.
Awarded Customer and Brand Loyalty Award by Business India & Business Standard in 2009
Awarded for Best Corporate Social Responsibility Practice at the Social & Corporate Governance Awards 08-09 by BSE, Nasscom Foundation and Times Foundation
Awarded in the Category 'FMCG Manufacturing Supply Chain Excellence' at the Third Express, Logistics & Supply Chain Awards by APL Logistics, Indiatimes, Mindscape, Business India Group in 2009
Our Orai unit received the Gold Excellence award and the Khalilabad unit received the Silver Excellence award in the environment category by Greentech Foundation in 2009
HUL's Goa factory won a Gold Trophy at the Greentech Awards in 2009 the manufacturing sector category for their outstanding work in Safety Management
Project Shakti won the Silver Trophy at the EMPI-Indian Express Indian Innovation Awards, 2009
Kwality Wall's Swirl's awarded 'The Franchisor of the year' for the Ice-cream parlour category by Franchise India in 2009
HUL brands have topped Brand Equity's ‘India’s Most Trusted Brands Survey’ rankings for 2010. Six HUL brands (Lux, Lifebuoy, Clinic Plus, Pond's, Fair & Lovely and Pepsodent) feature in the top 10 and eight in the top 20. All together there are 17 HUL brands among the ‘100 most trusted brands’ in the 2010 survey. Additionally, five HUL brands (Fair & Lovely, Lifebuoy, Lux, Pepsodent and Pond’s) featured in the list of ten Hall of Fame brands. This recognition was accorded to brands which consistently ranked high in the survey over the last 10 years since its inception. In 2009, three HUL brands featured in the top ten, and seven in the top twenty.
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SUGGESTIONS AND RECOMMENDATIONS
As it is obvious from the study the products of HUL have approached the high water mark of sale in the global consumer market. However, there are genuine reasons to observe that they have yet to attain the cutting edge status on many counts. In thisregard a few suggestions can be made to give the required boost to the marketingprospects of HUL products. These can be summed up as follows:
An attempt should be made by HUL management to tap all the potentialsoffered by the global market by devoting a more substantial, efficient and better equipped resource base. This task can be accomplished in the first place by implementing a stronger and more ending distribution channel for various products so that even those sections of consumers who are not accessible so easily, can be covered with greater ease.
Efficient infrastructural base coupled with better and more comprehensiveadvertising strategies should be resorted to; though HUL is presently surfingahead of others on the path of taking some great initiatives it should be moreconcerned about it for the purpose of corporate image building.
The price structure for various products should be more within the limit of affordability for consumers; the grassroots consideration in this regard should notbe ignored. Here, the policy of loco-centric rather than uniform price structurewould certainly be more advantageous.
HUL should go for more planned and sensible marketing and advertisingstrategies with a view to accomplishing the task of global brand image buildings.
Hypermarketing and retailing network should get special attention as vitalcomponents of HUL’s marketing policy
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CONCLUSION
In recent years, the FMCG sector declined due to downtrading. Also because of presence of large number of companies trying to seize this opportunity, this force the old HUL for the change and thus, their transformation has resulted in a new HUL, which has successfully faced this challenge and reversed this trend. It has done so by substantially strengthening their brands and building capabilities. This has already begun to yield benefits and they are returning to growth. Volume growth is being followed by value growth, which in turn is bringing profit growth.
India is one of the most exciting markets offering great potential.Over the next 10 years, the per capita income in India is likely to double. In FMCG, there is an opportunity to catalyze penetration, increase usage, and upgrade consumers. As a result, the FMCG market is expected to grow to over Rs.100,000 crores from its current base of Rs.40,000 crores.
The new Hindustan Lever see an exciting opportunity for growth. They have 35 powerful brands covering all segments, with leading market positions in most. Today, these are stronger and more relevant to the consumer than ever. The people are energized by the scale of the opportunity and determined to seize it. The scale of the business and operations gives them the resources needed.They are delivering good services and the changes they brought in the products are well taken by the customers, by this they are generating sustainable profitable growth
