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Presented by:Presented by:

Suchitra SinghSuchitra SinghAmit SinghAmit Singh

Akanksha SinghAkanksha Singh

Deepak SarmahDeepak Sarmah

Sandeep KumarSandeep Kumar

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History of Duleath Ltd.History of Duleath Ltd.

M/s Duleath Ltd. was started in 1960s.

Since 1960s, they are in business of

producing leather.

They are selling their leather to

companies involved in producing leather

shoes and other leather products.

With post liberalization period, after 1991

onwards, they diversified their business in

shoe manufacturing industry.

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InIn 19931993,, theythey setupsetup theirtheir ownown factoryfactory inin Noida,Noida, UU..PP..

TheyThey startedstarted theirtheir ownown R&DR&D facilityfacility inin theirtheir factoryfactory..

History of Duleath Ltd.History of Duleath Ltd.

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Leather Industry in IndiaLeather Industry in India

TheThe leatherleather andand leatherleather productsproducts industryindustry isis oneone of of ssoldestoldest manufacturingmanufacturing industriesindustries thatthat cateredcatered toto thethe

internationalinternational marketmarket rightright fromfrom thethe middlemiddle ofof thethe nineteenthnineteenth

centurycentury..

TheThe leatherleather industryindustry employsemploys aboutabout 22..55 millionmillion peoplepeople

andand hashas annualannual turnturn overover ofof RsRs.. 2525,,000000 crorescrores..

DueDue toto thethe ageage ofof thethe industryindustry andand itsits linkslinks withwith thethe socialsocialstructure,structure, thethe organizationalorganizational structurestructure thatthat hashas emergedemerged isis aa

veryvery complexcomplex oneone that that containscontains withinwithin it it elementselements ofof

continuitycontinuity withwith traditionaltraditional structuresstructures asas wellwell asas thosethose thatthat

representrepresent aa breakbreak withwith themthem..

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Trend of Leather Industry in IndiaTrend of Leather Industry in India

Source: Indian Council for Leather Exports

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Reasons forReasons forDiversificationDiversification

1.1. GovernmentGovernment givesgives encouragingencouraging

supportsupport toto leatherleather industryindustry inin IndiaIndia::

IfIf thethe companiescompanies sellingselling finishedfinished productsproducts mademade ofof leatherleather..

IfIf thethe firmfirm cancan exportexport leatherleather finishedfinished shoesshoes andand exportexport ofof

otherother leatherleather productsproducts..

22.. TheThe countriescountries whichwhich areare leadersleaders inin thethe fieldfield ofof

producingproducing shoesshoes inin worldworld forcedforced toto slowslow downdown theirtheir

productionproduction..

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Reasons for Duleath Ltd. entering intoReasons for Duleath Ltd. entering intoIndian Shoe MarketIndian Shoe Market

1)1) A large livestock population;A large livestock population;

2)2) Inexpensive skilledInexpensive skilled

manpower;manpower;

3)3) Encouragement & supportEncouragement & support

from Government.from Government.

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About Durcom ShoesAbout Durcom Shoes

InIn 19931993,, they they developeddeveloped aa

materialmaterial namednamed DurcomDurcom..

DurcomDurcom possessedpossessed allall thethe

necessarynecessary propertiesproperties forfor shoeshoemakingmaking materialmaterial suchsuch asas

PermeabilityPermeabilityStrengthStrength

FlexibilityFlexibility

DurabilityDurability

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Marketing StrategyMarketing Strategy

They Adopted Test Marketing toThey Adopted Test Marketing tomarket Durcom Shoes.market Durcom Shoes.

AA test markettest market is a geographic region oris a geographic region or demographicdemographic group used togroup used to

gauge the viability of a product or service in the mass marketgauge the viability of a product or service in the mass market prior to aprior to awide scale rollwide scale roll--out. The criteria used to judge the acceptability of a testout. The criteria used to judge the acceptability of a test

market region or group include:market region or group include:

A population that is demographically similar to the proposed targetA population that is demographically similar to the proposed target

market;market;

Relative isolation from densely populated media markets soRelative isolation from densely populated media markets so

thatthat advertisingadvertising to the test audience can be efficient and economical.to the test audience can be efficient and economical.

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Pricing StrategyPricing Strategy

DeuleathDeuleath LtdLtd.. SetSet upup aa PremiumPremium pricingpricing forfor DurcomDurcom ShoesShoes

ReasonsReasons forfor PremiumPremium PricingPricing::

SuperiorSuperior qualityquality overover leatherleather inin termsterms ofof durabilitydurability && easeease

ofof carecare..

WasWas firstfirst toto manufacturemanufacture highhigh pricedpriced shoesshoes whichwhich indicatesindicates

betterbetter qualityquality..

AfterAfter adoptingadopting SkimmingSkimming PricingPricing StrategyStrategy itit wouldwould latelylately

concentrateconcentrate onon PenetrationPenetration PricingPricing StrategyStrategy..

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Market trend of DurcomMarket trend of Durcom

ShoesShoes In the first three years, Durcom Shoes showed very

pleasing results.

Durcom shoes were sold increasingly in the first three

years.

Figures increased from 10,000 units in the year 1995 to25, 000 units till end of June 1997.

But from July 2007, the sale of Durcom Shoes began to fall

drastically.

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Reasons of failure ofReasons of failure of

Durcom ShoesDurcom Shoes

There was a falling trend of rate of rebuying by theThere was a falling trend of rate of rebuying by the

former buyers of the shoe.former buyers of the shoe.

Two main reasons as cited by the sales man as feed back forTwo main reasons as cited by the sales man as feed back forthis:this:

1.1. The high priced buyers did not get motivated by the factorsThe high priced buyers did not get motivated by the factors

such assuch as durability & ease of caredurability & ease of care as provided by Deuleath.as provided by Deuleath.

2.2. Complaints from the customers that the shoes makes themComplaints from the customers that the shoes makes them

feelfeel warmwarm which other brands dont.which other brands dont.

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QuestionsQuestions fromfrom thethe casecase::

Q.1: Where do you think that the company

went wrong in analyzing the consumer

shoe buyer behaviour?

Q.2: Do you think it would be preferable for the company

to identify a new buyer market (low priced shoe market

segment) ? If so, then what steps would you suggest to help

the prospective buyer to go through the buying decision

process?

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