Final HUL.doc

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CHAPTER NO.1

INTRODUCTION TO HINDUSTAN UNILEVER LIMITED

Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods

Company with a heritage of over 75 years in India and touches the lives of two out of

three Indians.

HUL works to create a better future every day and helps people feel good, look good

and get more out of life with brands and services that are good for them and good for

others.

With over 35 brands spanning 20 distinct categories such as soaps, detergents,

shampoos, skin care, toothpastes, deodorants, cosmetics, tea, coffee, packaged foods,

ice cream, and water purifiers, the Company is a part of the everyday life of millions

of consumers across India. Its portfolio includes leading household brands such as

Lux, Lifebuoy, Surf Excel, Rin, Wheel, Fair & Lovely, Ponds, Vaseline, Lakm,

Dove, Clinic Plus, Sunsilk, Pepsodent, Closeup, Axe, Brooke Bond, Bru, Knorr,

Kissan, Kwality Walls and Pureit.

The Company has over 16,000 employees and has an annual turnover of around

Rs. 21,736 crores (financial year 2011 - 2012). HUL is a subsidiary of Unilever, one

of the worlds leading suppliers of fast moving consumer goods with strong local

roots in more than 100 countries across the globe with annual sales of about 46.5

billion in 2011. Unilever has about 52% shareholding in HUL. Hindustan Unilever

Limited (HUL) is India's largest consumer goods company based in Mumbai,

Maharashtra.

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HUL was formed in 1933 as Lever Brothers India Limited and came into being in

1956 as Hindustan Lever Limited through a merger of Lever Brothers, Hindustan

Vanaspati Mfg. Co. Ltd. and United Traders Ltd. It is headquartered in Mumbai, India

and has an employee strength of over 16,500 employees and contributes to indirect

employment of over 65,000 people. The company was renamed in June 2007 as

Hindustan Unilever Limited.

Lever Brothers started its actual operations in India in the summer of 1888, when

crates full of Sunlight soap bars, embossed with the words "Made in England by

Lever Brothers" were shipped to the Kolkata harbor and it began an era of marketing

branded Fast Moving Consumer Goods (FMCG).

Hindustan Unilever's distribution covers over 2 million retail outlets across India

directly and its products are available in over 6.4 million outlets in the country. As per

Nielsen market research data, two out of three Indians use HUL products.

Our vision

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.

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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 with the aim of doubling 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 peoples

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.

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Purpose & principles

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.

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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.

Our purpose

At the heart of the corporate purpose, which guides us in our approach to doing

business, is the drive to serve consumers in a unique and effective way. This purpose

has been communicated to all employees worldwide.

Our vision

We meet everyday needs for nutrition, hygiene and personal care with brands that

help people feel good, look good and get more out of life. Sustainability is at the heart

of our business, and through our brands, we seek to inspire people to take small

everyday actions that can add up to a big difference for the world.

Our deep roots in local cultures and markets around the world give us our strong

relationship with consumers and are the foundation for our future growth. We will

bring our wealth of knowledge and international expertise to the service of local

consumers a truly multi-local multinational.

Our long-term success requires a total commitment to exceptional standards of

performance and productivity, to working together effectively, and to a willingness to

embrace new ideas and learn continuously.

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CHAPTER NO.2

CODE OF BUSINESS PRINCIPLES

Introduction

Our Principles

Our code of business principles describes the operational standards that everyone at

Unilever follows, wherever they are in the world. It also supports our approach to

governance and corporate responsibility.

Unilever has earned a reputation for conducting its business with integrity and with

respect for all those whom our activities affect. This reputation is an asset, just as

valuable as our people and our brands.

To maintain this reputation requires the highest standards of behaviour consistently

observed by all of us. Unilevers Code of Business Principles sets out these standards

and we expect all our employees to adhere to them.

Being a successful business does not just mean investing for growth and balancing

short and long term interests. It also means caring about our consumers, employees

and shareholders, our business partners and the world in which we live.

We therefore want this Code to be more than a collection of high sounding

statements. It must have practical value in our day-to-day business lives and each of

us must follow these principles both in the spirit and the letter.

If we do so, Unilevers reputation will be enhanced, our business will perform better

and our professional lives will be all the more fulfilling.

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Standard of Conduct

We conduct our operations with honesty, integrity and openness, and with respect for

the human rights and interests of our employees.

We shall similarly respect the legitimate interests of those with whom we have

relationships.

Obeying the Law

Unilever companies and our employees are required to comply with the laws and

regulations of the countries in which we operate.

Employees

Unilever is committed to diversity in a working environment where there is mutual

trust and respect and where everyone feels responsible for the performance and

reputation of our company.

We will recruit, employ and promote employees on the sole basis of the qualifications

and abilities needed for the work to be performed. We are committed to safe and

healthy working conditions for all employees. We will not use any form of forced,

compulsory or child labour. We are committed to working with employees to develop

and enhance each individual's skills and capabilities.

We respect the dignity of the individual and the right of employees to freedom of

association.

We will maintain good communications with employees through company based

information and consultation procedures.

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Consumers

Unilever is committed to providing branded products and services which consistently

offer value in terms of price and quality, and which are safe for their intended use.

Products and services will be accurately and properly labelled, advertised and

communicated.

Shareholders

Unilever will conduct its operations in accordance with internationally accepted

principles of good corporate governance. We will provide timely, regular and reliable

information on our activities, structure, financial situation and performance to all

shareholders.

Business Partners

Unilever is committed to establishing mutually beneficial relations with our suppliers,

customers and business partners. In our business dealings we expect our business

partners to adhere to business principles consistent with our own.

Community Involvement

Unilever strives to be a trusted corporate citizen and, as an integral part of society, to

fulfil our responsibilities to the societies and communities in which we operate.

Public Activities

Unilever companies are encouraged to promote and defend their legitimate business

interests.

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Unilever will co-operate with governments and other organisations, both directly and

through bodies such as trade associations, in the development of proposed legislation

and other regulations which may affect legitimate business interests.

Unilever neither supports political parties nor contributes to the funds of groups

whose activities are calculated to promote party interests.

The Environment

Unilever is committed to making continuous improvements in the management of our

environmental impact and to the longer-term goal of developing a sustainable

business.

Unilever will work in partnership with others to promote environmental care, increase

understanding of environmental issues and disseminate good practice.

Innovation

In our scientific innovation to meet consumer needs we will respect the concerns of

our consumers and of society. We will work on the basis of sound science applying

rigorous standards of product safety.

Competition

Unilever believes in vigorous yet fair competition and supports the development of

appropriate competition laws. Unilever companies and employees will conduct their

operations in accordance with the principles of fair competition and all applicable

regulations.

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Business Integrity

Unilever does not give or receive whether directly or indirectly bribes or other

improper advantages for business or financial gain. No employee may offer give or

receive any gift or payment which is, or may be construed as being, a bribe. Any

demand for, or offer of, a bribe must be rejected immediately and reported to

management.

Unilever accounting records and supporting documents must accurately describe and

reflect the nature of the underlying transactions. No undisclosed or unrecorded

account, fund or asset will be established or maintained.

Conflicts of Interests

All Unilever employees are expected to avoid personal activities and financial

interests which could conflict with their responsibilities to the company.

Unilever employees must not seek gain for themselves or others through misuse of

their positions.

Compliance - Monitoring Reporting

Compliance with these principles is an essential element in our business success. The

Unilever Board is responsible for ensuring these principles are applied throughout

Unilever.

The Chief Executive Officer is responsible for implementing these principles and is

supported in this by the Corporate Code Committee chaired by the Chief Legal

Officer, Members of the Committee are the Group Secretary, the Chief Auditor, the

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SVP HR and the SVP Communications. The Global Code Officer is Secretary to the

Committee. The Committee presents quarterly updates to the Corporate

Responsibility and Reputation and the Audit Committee, half-yearly reports to the

Unilever Executive and an annual report to the Board.

Day to day responsibility is delegated to all senior management of the regions,

categories, functions and operating companies. They are responsible for implementing

these principles, if necessary through more detailed guidance tailored to local needs,

and are supported in this by Regional Code Committees comprising the Regional

General Counsel together with representatives from all relevant functions and

categories. Assurance of compliance is given and monitored each year. Compliance

with the Code is subject to review by the Board supported by the Corporate

Responsibility and Reputation Committee and for financial and accounting issues the

Audit Committee.

Any breaches of the Code must be reported in accordance with the procedures

specified by the Chief Legal Officer. The Board of Unilever will not criticise

management for any loss of business resulting from adherence to these principles and

other mandatory policies and instructions. The Board of Unilever expects employees

to bring to their attention, or to that of senior management, any breach or suspected

breach of these principles. Provision has been made for employees to be able to report

in confidence and no employee will suffer as a consequence of doing so.

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Business Partner Code

It is Unilevers policy to formally request that all our suppliers respect the principles

of our Supplier Code and adopt practices that are consistent with it.

The Code

Unilevers Supplier Code states that:

There shall be compliance with all applicable laws and regulations of the country

where operations are undertaken.

There shall be respect for human rights, and no employee shall suffer harassment,

physical or mental punishment, or other form of abuse.

Wages and working hours will, as a minimum, comply with all applicable wage and

hour laws, and rules and regulations, including minimum wage, overtime and

maximum hours in the country concerned.

There shall be no use of forced or compulsory labour, and employees shall be free

to leave employment after reasonable notice.

There shall be no use of child labour, and specifically there will be compliance with

relevant International Labour Organization (ILO) standards.

There shall be respect for the right of employees to freedom of association and

recognition of employees rights to collective bargaining, where allowable by law.

Safe and healthy working conditions will be provided for all employees.

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Operations will be carried out with care for the environment and will include

compliance with all relevant legislation in the country concerned.

All products and services will be delivered to meet the quality and safety criteria

specified in relevant contract elements, and will be safe for their intended use.

Business will be conducted with integrity. There will be no payments, services,

gifts, entertainment or other advantages offered or given to any Unilever employee or

third party which are intended to influence the way in which the Unilever employee or

third party goes about his or her duties. Similarly Unilever will not offer or give such

payments, services, gifts, entertainment or other advantages to any supplier which are

intended to influence the way in which the supplier goes about his or her duties. There

will be no actual or attempted money laundering.

Unilever's direct suppliers will take responsibility to require adherence to the

principals of this Supplier Code from their direct suppliers and exercise diligence in

verifying that these principles are being adhered to in their supply chains.

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CHAPTER NO. 3

COMPANY STRUCTURE

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ManagingDirector

GeneralManager

Vice President

Marketing Manufacturing

Sales Finance Distribution


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Hindustan Unilever Limited is India's largest Fast Moving Consumer Goods (FMCG)

company. It is present in Home & Personal Care and Foods & Beverages categories.

HUL has over 16,500 employees, including over 1500 managers

The fundamental principle determining the organization structure is to infuse speed

and flexibility in decision-making and implementation, with empowered managers

across the companys nationwide operations.

Board of Directors

The Board of Directors of the Company represents an optimum mix of

professionalism, knowledge and experience. The total strength of the Board of

Directors of the Company is nine Directors, comprising Non-Executive Chairman,

four Executive Directors and four Non-Executive Independent Directors.

Management Committee

The day-to-day management of affairs of the Company is vested with the

Management Committee which is subjected to the overall superintendence and control

of the Board.

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CHAPTER NO.4

INTRODUCTION TOMARKETING MIX STRATEGY

Marketing is the process of communicating the value of a product or service to

customers. Marketing can sometimes be interpreted as the art of selling products, but

selling is only a small fraction of marketing.

Marketing can be looked at as an organizational function and a set of processes for

creating, delivering and communicating value to customers, and managing customer

relationships in ways that benefit the organization and its shareholders. Marketing

management is the art of choosing target markets and acquiring, and keeping

customers through providing superior customer value.

There are five competing concepts under which organizations can choose to operate

their business; the production concept, the product concept, the selling concept, the

marketing concept, and the holistic marketing concept. The four components of

holistic marketing are relationship marketing, internal marketing, integrated

marketing, and socially responsive marketing. The set of engagements necessary for

successful marketing management includes, capturing marketing insights, connecting

with customers, building strong brands, shaping the market offerings, delivering and

communicating value, creating long-term growth, and developing marketing strategies

and plans.

The marketing mix is a business tool used in marketing products. The marketing mix

is often crucial when determining a product or brand's unique selling point (the unique

quality that differentiates a product from its competitors), and is often synonymous

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with the four Ps: price, product, promotion, and place; in recent times, however, the

four Ps have been expanded to the seven Ps or replaced by the four Cs. And there are

two four Cs theories today. One is Lauterborn's four Cs(Consumer, Cost,

Communication, Convenience), another is Shimizu's four Cs (Commodity, Cost,

Communication, Channel).

The term marketing mix was coined in an article written by Neil Borden called The

Concept of the Marketing Mix. He started teaching the term after he learned about it

from an associate, James Culliton, who in 1948 described the role of the marketing

manager as a "mixer of ingredients"; one who sometimes follows recipes prepared by

others, sometimes prepares his own recipe as he goes along, sometimes adapts a

recipe from immediately available ingredients, and at other times invents new

ingredients no one else has tried.

Four Ps In Marketing Strategy

The marketer, E. Jerome McCarthy, proposed a four Ps classification in 1960, which

has since been used by marketers throughout the world.

Product Strategy

Product is the mix of all the features, advantages, and benefits that you offer to your

target market. It may include certain characteristics such as quality, packaging, after

sales support, customer services etc. In order to ensure that your customers are

gaining the full benefits of your product, you can consider the following questions.

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A product is seen as an item that satisfies what a consumer needs or wants. It is a

tangible good or an intangible service. Intangible products are service based like the

tourism industry, thehotel industry and the financial industry. Tangible products are

those that have an independent physical existence. Typical examples of mass-

produced, tangible objects are the motor carand the disposable razor. A less obvious

but ubiquitous mass produced service is a computer operating system.

Every product is subject to a life-cycle including a growth phase followed by a

maturity phase and finally an eventual period of decline as sales falls. Marketers must

do careful research on how long the life cycle of the product they are marketing is

likely to be and focus their attention on different challenges that arise as the product

moves through each stage.

The marketer must also consider the product mix. Marketers can expand the current

product mix by increasing a certain product line's depth or by increasing the number

of product lines. Marketers should consider how to position the product, how to

exploit the brand, how to exploit the company's resources and how to configure the

product mix so that each product complements the other. The marketer must also

consider product development strategies.

What is the core benefit your product offers? For instance, customers who purchase

mobile phones buy more than just a phone; they purchase the ability to keep in touch.

What does the actual product include? This includes branding, additional features

and benefits that provide differentiation and ensures that customers will purchase your

product over the competitors.

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What non tangible benefits can you offer? Factors to consider at this point may

include after sales service, warranties, delivery etc.

Price Strategy

Price relates to the pricing strategy of your products or services. It may include

discounts, trade in allowances and credit terms to adjust for the competitive situation

in order to bring the price into line with the buyer's perception of the value of the

product. Businesses may use different pricing strategies based on different situations.

These are listed following:

Premium Pricing - is used where a business may feel that there is a substantial

competitive advantage for its products. Such high prices may be charged for luxurious

products such as rare automobiles, first class airline services etc.

Penetration pricing - may be used where a business would set a price lower than the

general market price in order to increase sales and market share. Once this is

achieved, the prices would be increased. Penetration pricing would normally be most

suitable for products with high price sensitivity whereby a small change in price

would result in a large change in demand.

Skimming Pricing - involves setting a high initial price relative to the prices of

competing products. Price Skimming works best for prestigious products since

buyers tend to be more prestige conscious rather than price conscious. Due to the

initial high prices, the skimming strategy may also enable the organisation to recover

its product development costs at an early stage. Once the product has been in the

market for a short period, most businesses tend to lower prices over time making the

product available to a wider market.

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Competition Pricing - involves setting prices in comparison with your competitors.

This pricing strategy is one of the most common strategies used by small retail

businesses as an attempt to avoid price wars and still maintain a stable level of profit.

The price is the amount a customer pays for the product. The price is very important

as it determines the company's profit and hence, survival. Adjusting the price has a

profound impact on the marketing strategy, and depending on the price elasticity of

the product, often it will affect the demand and sales as well. The marketer should set

a price that complements the other elements of the marketing mix.

When setting a price, the marketer must be aware of the customer perceived value for

the product. Three basic pricing strategies are: market skimming pricing, market

penetration pricing and neutral pricing. The 'reference value' (where the consumer

refers to the prices of competing products) and the 'differential value' (the consumer's

view of this product's attributes versus the attributes of other products) must be taken

into account.

Promotion Strategy

Represents all of the methods of communication that a marketer may use to provide

information to different parties about the product. Promotion comprises elements such

as:advertising,public relations,personal selling and sales promotion.

Promotion refers to the promotional activities that communicate the merits of your

product to your target market in an attempt to persuade them to purchase it. It may

include various methods of promotions such as direct marketing, advertising, personal

selling, sales promotions etc.

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Advertising covers any communication that is paid for, from cinema commercials,

radio and Internet advertisements through print media and billboards. Public relations

is where the communication is not directly paid for and includes press releases,

sponsorship deals, exhibitions, conferences, seminars or trade fairs and events. Word-

of-mouth is any apparently informal communication about the product by ordinary

individuals, satisfied customers or people specifically engaged to create word of

mouth momentum. Sales staff often plays an important role in word of mouth and

public relations.

PlaceStrategy

Refers to providing the product at a place which is convenient for consumers to

access. Place is synonymous with distribution. Various strategies such as intensive

distribution, selective distribution, exclusive distribution and franchising can be used

by the marketer to complement the other aspects of the marketing mix.

Place refers to where the sales are to be made and how the products will be

distributed. It includes: channels of distribution, the extent of market coverage,

managing inventories, transportation and logistics. Put simply, Place involves all

activities that deliver the product to your target customers.

Organizations that facilitate the movement of products from the manufacturer to the

final user of the product are known as intermediaries. The common types of

intermediaries include:

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Retailers: Those companies that sell mainly to consumers and determine the final

selling price of the product.

Wholesalers: Those companies that purchase merchandise in bulk from producers

and resell mainly to businesses, the government and other retailers.

Agents and brokers: Those firms do not take the title or ownership of goods and

services but facilitate the sale of products from the manufacturer to the end user and

take a commission upon the sale of goods.

With the rapid advancement of internet technology and increasing broadband uptake

there is currently a move towards selling goods online particularly with the increased

use of e-commerce technology. As the internet facilitates a geographically dispersed

market, firms are now able to reach a wider audience with a low setup cost.

The 'seven Ps' refers to the already mentioned four Ps, plus 'physical evidence',

'people', and 'process'. 'Physical evidence' refers to elements within the store -- the

store front, the uniforms employees wear, signboards, etc. 'People' refers to the

employees of the organization with whom customers come into contact with. 'Process'

refers to the processes and systems within the organization that affects its marketing

process. These later three factors are not cited nearly as often as the first four outlined

in depth above.

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CHAPTER NO.5

MARKETING MIX STRATEGY OF HINDUSTAN UNILIVER LIMITED

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 Srimatiwhich was rolled out in 2006is also on the right track.

HULs 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%.

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Wheel, a value brand that, according to Vats contributes around 50% of HULs

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 doesnt report its laundry revenues separately

but puts them under the soaps and detergent category. In 2006, HULs soaps and

detergents segment contributed around Rs5,596 crore to the companys 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.

PRODUCT STRATEGY

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:

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The companys popular products include:

Bathing soaps: Lux, Lifebuoy, Liril, Hamam, Breeze, Dove, Pears and Rexona

Laundry items: Surf Excel, Rin and Wheel

Skin care: Fair & Lovely, Ponds and Vaseline

Hair care: Sunsilk and Clinic

Oral care: Pepsodent and Close up

Deodorants: Axe and Rexona

Colour cosmetics: Lakme

Ayurvedic: Ayush

Tea: Brooke Bond and Lipton

Coffee: Bru

Foods: Kissan, Annapurna and Knorr

Ice cream: Kwality Walls .

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PRICING STRATEGY

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. 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.

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PLACE STRATEGY

BRAND ISNT 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. But getting their means managing wildly different terrains-climate,

language, value system, life style, transport and communication network. And your

brand equity isnt going to help when it comes to tackling these issues.

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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.

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PROMOTION STRATEGY

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.

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.

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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.

Ad 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.

Its a combination of spiffing up its key brand, researching and improving the newer

products that havent 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.

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CHAPTER NO.6

SWOT ANALYSIS OF HUL

Strength

1. 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..

2. 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."

3. 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.

4. Low cost of production due to economic of scale. That means higher profits

and / or more competitioners. Better market penetration.

5. 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.

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Weakness

1. Continuous threat from other competitors.

Opportunities

1. Increasing per capita national income resulting in higher disposable income.

2. Growing middle class and growing urban population.

3. Increasing gifts cultures.

4. Increasing departmental stores concept impulse @ at cash counters.

5. Globalization.

Threats

1. HLL's tea business has declined marginally, reason is that, cost pressure is

likely due to rising crude and freight costs.

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CHAPTER NO.7

PEST ANALYSIS OF HUL

P: since the budget range is decontrolled, no political effects are envisaged.

E: 1) increasing per capita income resulting in higher

Disposable income

2) Growing middle class/urban population increase in

Demand

3) Low cost of production better penetration

S: 1) Per capita consumption expected to increase fashion

2) Increasing gifts culture increase in demand

T: Will have to reinforce technology to international levels

Once India is a fully free economy.

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CHAPTER NO.8

HINDUSTAN UNILEVERS 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:

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.

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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.

HUL-UNIQUELY POSITIONED TO CREATE VALUE

Our strategy

* Grow ahead of the market by leading market development activities.

* Leverage positive impact of growing Indian economy on consumer spending.

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* Grow a profitable foods and top end business.

* Grow the bottom line ahead of the top line.

* Strong commitment to sustainable development.

Competitive strengths

Corporate Social Responsibility-Aiding In The Development Of The Country

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Shakti

Three shakti initiatives

Shakti entrepreneur; currently~44000 women cover 1,25000 villages.

Shakti vani: one-to-many communication for category growth

ishakti: customized interaction with remote consumers.

Impact of community

business and social impact can go together.

partnerships with diverse stakeholders.

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CHAPTER NO.9

HINDUSTAN UNILEVER LIMITED COMPARATIVE BUSINESS ANALYSIS

Hindustan Unilever Limited Formerly known as Hindustan Lever Limited. The

Group's principal activities are to manufacture and market consumer products. The

Group operates through seven segments: Soaps and Detergents, Personal Products,

Exports, Beverages, Foods, Ice Creams and Other. The products include home and

personal care products, foods and beverages, industrial and agricultural products.

Home and personal care products consists of personal and fabric wash, household,

oral care, skin and hair care, deodorants, perfumery, colour cosmetics and baby care.

Foods and beverages includes tea, coffee, cooking fats and oils, bakery fats, ice

creams, tomato products, fruit and vegetable products, rice, salt, atta and rawa, marine

products and mushrooms. Industrial and agricultural products includes specialty

chemicals, bulk chemicals, fertilisers, animal feeds, seeds, plant growth nutrients,

processed-tri-glycerides and agri commodities, yeast, leather, footwear and carpets,

thermometers and plantations.

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This analysis compares Hindustan Unilever Limited with three other companies in

closely related industry sectors.

The company focuses on efficient delivery to consumers with an improved supply

chain, brand building initiatives and innovation, which has helped the company to

sustain its leadership position in the overall FMCG category in India.

Its brands are spread across 20 consumer product categories. Hindustan Unilever

markets consumer goods throughout India. The company faces competition from

international, local and regional players.

CHAPTER NO.10

JOINT VENTURE

Hindustan Unilever Sets Up Joint Venture With Smollan Holdings

Hindustan Unilever Limited (HUL) has decided to set up a Joint Venture (JV) with

Smollan Holdings of South Africa and the JV will be operational from January 1,

2008. The strategic tie-up aims to build long term capabilities and bring in-store

execution focus in servicing the Companys Modern Trade customers.

The new company has been named as Hindustan Unilever Field Services Private

Limited (HUFS) and will work exclusively on behalf of HUL in Modern Trade

channel only. The operations will begin with the existing Modern Trade in-store

execution team of HUL moving into HUFS.

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Smollan Holdings is one of the leading in-store execution and field services

companies internationally. It has leading edge capabilities in servicing Modern Trade

focused on shelf filling, logistics for merchandising materials and in store execution.

Modern Trade in India is growing and evolving very rapidly and our strategy for

winning in this growing retail market is to win at point-of-purchase with our shoppers

& by delivering best-in-class service to our Modern Trade customers. This JV will

bring in world class execution excellence in the market and build the right capabilities

to deliver the companys marketing strategy in Modern Trade.

Other Acquisition

Hindustan Unilever has acquired several Indian FMCG companies so far. This

includes:

Tata Oil Mills Company

Brooke Bond

Lipton India

Modern Foods

It acquired Kissan brand from UB group; Dollops ice cream brand from Cadbury

India; Lakme cosmetics brands from Tata. It has also launched Pureit, a home water

purifier which supplies drinking water without boiling/need of electricity.

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Hindustan Unilever Network is the direct selling channel of the company. It has about

350,000 consultants, all independent entrepreneurs, trained and guided by HLN's

expert managers and trainers.

NEW INITIATIVE

Bringing High-End Dove To India

Baillie is fighting back. Over the past six months, Hindustan Unilever launched a

high-end range of Ponds skin care and Dove hair care products from Unilevers

international portfolio. These premium brands retail not in neighborhood small stores

but in supermarkets and hypermarkets, where Indian customers love to touch and feel

products.

Hindustan Unilever is also milking one of its top brandsFair & Lovely, a hot-selling

fairness cream, which promises a lighter skin, tone for many of Indias complexion-

conscious consumers. The advertising campaign, which suggests that regular use of

the cream helps women gain confidence and makes them eligible for marriage, has

made the brand a winner. That has spawned a host of competitive fairness creams,

soaps, and sunblock lotions. But Hindustan Unilevers brand is still tops.

Baillie is also getting aggressive on foods, focusing on the Knorr brand of soups and

curry mixesideal for the Indian market. Analysts believe the companys current

strategy of concentrating on premium products and marketing them in the large retail

stores is a winning one. Sumeet Budhraja, consumer analyst at Mumbai brokerage

First Global Securities, says that Hindustan Unilever could have addressed a lot

more categories, but they are more focused and regaining their aggressiveness. He

points to the demand for safe drinking water in India, which Hindustan Unilever

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exploited with the launch of water purifier Pureit in 2005, at one-third the price of

established Indian brands such as Aqua guard.

These efforts have delivered some promising results, and Baillie is pleased with the

modest turnaround. In the quarter ended June, 2007, the companys sales grew 13%,

with net profit up 29.6%. Reason enough to keep patrolling those store aisles.

CHAPTER NO.11

SERVICE TO SOCIETY

HUL believes that an organizations worth is also in the service it renders to the

community. HUL is focusing on health & hygiene education, women empowerment,

and water management. 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 village built by

HUL in earthquake affected Gujarat, and relief & rehabilitation after the Tsunami

caused devastation in South India.

In 2001, the company embarked on an ambitious programmes, Shakti. Through

Shakti, HUL is creating micro-enterprise opportunities for rural women, thereby

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improving their livelihood and the standard of living in rural communities. Shakti also

includes health and hygiene education through the Shakti Vani Programmes, and

creating access to relevant information through the iShakti community portal. The

program now covers 15 states in India and has over 31,000 women entrepreneurs in

its fold, reaching out to 100,000 villages and directly reaching to 150 million rural

consumers. By the end of 2010, Shakti aims to have 100,000 Shakti entrepreneurs

covering 500,000 villages, touching the lives of over 600million people.

HUL is also running a rural health programmes Lifebuoy Swasthya Chetana. The

programmes endeavours to induce adoption of hygienic practices among rural Indians

and aims to bring down the incidence of diarrhoea.

It has already touched 70 million people in approximately 15000 villages of 8 states.

The vision is to make a billion Indians feel safe and secure.

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.

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CONCLUSION

This company project has demonstrated HINDUSTAN UNILEVERS

MARKETING STRATEGIES AND POLICIES that has proved to be extensive

through, and of great benefit to the company in furthering its competitive advantage.

In this project it possible to see the success of Hindustan Unilevers in its indorse its

strong potential to continue to do well.

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BIBLIOGRAPHY

A L Ries (1996), Focus Harper Collins Publishers Ltd.

David A. Aaker (1991), Managing Brand Equity, The Free Press.

David A. Aaker (1996) Building Strong Brands, The Free Press.

Philip Kotler (Eighth Edition) Marketing Management, Prentice Hall of India Ltd.

The Economic Times Brand Equity

Market survey and questionnaires

www.unilever.com

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