Draft Report Hul

8/6/2019 Draft Report Hul

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CHAPTER - 1

EXECUTIVE SUMMARY

1. EXECUTIVE SUMMARY

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Hindustan Unilever is a subsidiary of Unilever. Unilever has about 52% shareholding in

HUL. HUL is the market leader in Indian consumer products with 35 brands across 20

distinct categories. Hindustan Unilever is the market leader in most of the categories it

operates.

Hindustan Unilever is facing strong competition from global players like P&G and reckinett

& beckner as well as local players such as Dabur and ITC.

HUL launched its water brand pure it in 2004 and expanded itself in to consumer durable

industry.

In water brand category the major competitors of HUL are eureka fobes, Kent and Tata

swach.

The project focuses on study of consumer purchase behavior of water purifiers and

comparing the results with the features of pure it to and to study the extent to which the

product is meeting the customer requirements.

The consumer behavior was studied by collecting data through questionnaire and analyzing

the data with the use of SPSS.

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CHAPTER - 2

INTRODUCTION

Industry profile:

In the past 10 years, the global market has witnessed a pitch in demand as economies such as

Brazil, Mexico, India and China have opened up and begun rapid development. The

consumer durables industry has always exhibited impressive growth despite strongcompetition and constant price cutting. Projections for current year demand are very

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optimistic, as consumers resume spending is increasing and producers launch new attractive

variants to grab new customers.

Developing countries such as India and China have largely been shielded from the backlash

of the recession, as consumers continued to buy basic appliances. In fact, China has been

ranked the second-biggest market in the world for consumer electronics. Despite the

recession, their strong domestic economy and growing high-income population have

balanced demand leading to aggressive market growth.

There is growing interest for new age products such as LCD-TVs and DVD players.

Meanwhile, the penetration of the basic, largest dollar items such as ovens, washing machines

and refrigerators is also increasing. India too, has witnessed a similar phenomenon, with the

urban consumer durables market growing at almost 10 %p.a., and the rural durables market

growing at 25% p.a.

Some high-growth categories within this segment include mobile phones, TVs. With being

the second fastest growing economy with a rate of more than 9 per cent, with a huge

consumer class nearly 70 per cent in rural areas, consumer durables have emerged as one of

the fastest growing industries in especially in rural . Now the consumer durable industry is

paying more attention to attract rural community by promoting their products and services in

their local languages.

A study revealed that in the coming five years it would be a new era for rural, by 2015 it is

expected that every village will be connected by an all weather road, every village will get

the internet connectivity and almost every home will have Electricity and possess a mobile

phone. This significant improvement in rural infrastructure coupled with agriculture reforms

already under way. By this the industry expects rural market to reach at inflexion point. This

built up will lead to an explosion in demand the way it happened in the urban markets in the

mid 90s.

The Indian consumer durables industry has witnessed a considerable change in the past

couple of years. The market for consumer durables is estimated at Rs. 300 billion and is

expected to reach Rs. 500 billion by 2015. Changing lifestyle, higher disposable income

coupled with greater affordability and a surge in advertising has been instrumental in

bringing about change in the consumer behavior pattern. Apart from steady income gains,

consumer financing and hire-purchase schemes have become a major driver in the consumer

durables industry.

In the case of more expensive consumer goods, such as refrigerators, washing machines,

color televisions and personal computers, retailers are joining forces with banks and financecompanies to market their goods more aggressively.

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The competition in the industry has intensified after the liberalization and more and more

MNC are coming to India to target the huge middle class of the country.

The biggest attraction for MNCs is the growing Indian middle class (approx. 250 m). This

market is characterized with low penetration levels. MNCs hold an edge over their Indian

counterparts in terms of superior technology combined with a steady flow of capital, while

domestic companies compete on the basis of their well-acknowledged brands, an extensive

distribution network and an insight in local market conditions.

The competition in the industry has intensified after the liberalization and more and more

MNC are coming to India to target the huge middle class of the country. The competition is

dependent upon the brand strength and distribution network. In other words, the advertising

and marketing expenses play a vital role in competition. As a result of the increased

competitive activity, the advertising and marketing costs as a percentage of operating income

have increased over the years. This ratio for the industry has increased from 4.4 percent in

1993 to 6.7 percentage in 2000. However, the export prospects are least or minimal because

indigenous manufacturers do not possess adequate brand equity or excellent product quality.

There are even constraints like transportation due to poor infrastructure and relatively under

developed markets in the neighbouring countries.

The drivers that will leads to the growth of the industry in general will be:

The degree of distribution network in the market.

The advertising and marketing strategy adopted by the players in the industry.

The brand image of the product as perceived by the consumer.

The technology used by the company viz. state-of-the art technology.

The ability of the company to introduce newer products and newer product features.

The capability of the company to service its products.

The discount schemes and consumer finance facility available.

The market positioning of the product.

The cost competitiveness and pricing strategy of the company.

The financial strength of the players.

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Swot analysis of consumer durable industry

Strength:

Presence of established distribution networks in both urban and rural areas.

Presence of well-known brands

Organized sector has increased its share in the market vs. the unorganized sector.

Weakness:

Demand is seasonal and is high during festive season.

Demand is dependent on good monsoons.

Poor government spending on infrastructure.

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Oppurtunities:

Unexploited rural market.

Increase in income levels.

Easy availability of finance.

In India, the penetration level of white goods is lower as compared to other

developing countries.

Threats:

Cheap imports from Singapore, China and other Asian countries.

Company profile:

HUL was formed in 1933 as Lever Brothers India Limited and came into being in 1956 as

Hindustan Lever Limited through a merger ofLever Brothers, Hindustan Vanaspati Mfg. Co.

Ltd. and United Traders Ltd. It is headquartered in Mumbai, India. The Company was

renamed in June 2007 as Hindustan Unilever Limited.

Hindustan Unilever 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 44 billion in 2011. Unilever has about 52% shareholding in HUL.

HUL is the market leader in Indian consumer products with 35 brands across 20 distinct

categories such as soaps, detergents, shampoos, skin care, toothpastes, deodorants, cosmetics,

tea, coffee, packaged foods, ice cream, and water purifiers. The Company has over 16,000

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employees and has an annual turnover of around Rs.19, 400 crores (financial year 2010 -

2011) and contributes to indirect employment of over 52,000 people.

Vision:

Work to create a better future every day

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.

Inspire people to take small everyday actions that can add up to a big difference for

the world.

Develop new ways of doing business with the aim of doubling the size of our

company while reducing our environmental impact.

Mission:

Add vitality to life

Company structure:

Hindustan Unilever believes that the fundamental principle determining the organisation

structure is to infuse speed and flexibility in decision-making and implementation, with

empowered managers across the companys nationwide operations.

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Brands:

HUL has divided its products into following categories: Home and Personal Care, Food and

Water.

The individual brands within these sub-categories are

Personal care:

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Home care:

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Food brands:

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Water brand:

Pure it :

Hindustan unilever launched pure it in 2004 in Chennai, Tamil Nadu

Pure It is the worlds most advanced in-home water purifier. Pure It, a breakthrough offering

of Hindustan Unilever (HUL), provides complete protection from all water-borne diseases,

unmatched convenience and affordability.

Water Purifiers offered by HUL

(1) PUREITCOMPACT RS 1000 /-(2) PUREIT M05 MODEL RS 2000 /-

(3) PUREIT AUTOFILL RS 3200 /-

(4) PUREIT MARVELLA RS 6900 /-

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Pure it marvella pure it auto fill

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Pure itclassic pure it compact

Swot analysis of HUL

Strengths:

Excellent distribution network covering over 3400 distributors and 16 million outlets.

Weakness:

Oppurtunities:

Threats:

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Marketing Mix (pure it)

Product:

Easily available nationwide.

Easy to handle.

Multiple products launched for each product type.

Price:

Product price range divided into four segments to target different audiences.

Low cost of maintenance and consumable.

Promotion:

Active subscription immediately

Timely installation of products

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Proper repair services against paid AMCs

Service during contract period

Place:

Urban educated India that cares for their family.

Areas prone to water borne diseases.

Various stalls near market places.

Corporate social Responsibility:

Hindustan Unilever (HUL) and the State Bank of India (SBI) have joined forces to bring

banking services to low-income people in small Indian villages. HUL also runs a rural health

programme, Lifebuoy Swasthya Chetana. The programme endeavors to induce adoption of

hygienic practices among rural Indians and aims to bring down the incidence of diarrhoea.

HULs 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.

Financial data:

2010-11 Results at a Glance

Comparable audited results (in crores) for the 12 month period from April 2010 to March 31,

2011compared to April 2009 to March 31, 2010

Major Competitors:

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Competitors in personal & Home care

Procter and gamble:P&G Home Products Limited is one of India's fastest growing Fast Moving Consumer Goods

Companies that has in its portfolio P&G's global brands such as Ariel and Tide in the Fabric

Care segment, and in the Hair Care segment: Head & Shoulders; Pantene and Rejoice.

P&G Home Products Limited is a 100% subsidiary of The Procter & Gamble Company, USA

that in India, has carved a reputation for delivering superior quality, value-added products to

meet the needs of consumers.

Dabur India Dabur India Limited is the fourth largest FMCG Company in India with

Market Capitalisation of Rs.16,000 crores. Dabur operates in key consumer products

categories like Hair Care, Oral Care, Health Care, Skin Care, Home Care & Foods. Dabur

specialises in Ayurvedic products.

ITC: ITC is one of Indias foremost private sector companies. While ITC is an outstanding

market leader in its traditional businesses of Cigarettes, Hotels, Paperboards, Packaging and

Agri-Exports, it is rapidly gaining market share even in its nascent businesses of Packaged

Foods & Confectionery, Branded Apparel, Personal Care and Stationery.

Competitors in Water Brand

Eureka forbes: Eureka Forbes is a part of the Shapoorji Pallonji Group and it is a 13 billion

INR, multi product and multi channel corporation. They have a wide range of water purifiersand are market leaders in water purifier segment. Aqua guard and Aqua sure are products of

eureka forbes.

Kent: kent is an Indian healthcare product companystarted in 1999. Apart from the water

purification systems, it also provides air purification systems and water softners.

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Tata swach: The Tata Swach water purifieris developed by Tata Chemicals, a part of

the Tata group in India. The Swach was designed as a low cost purifier for Indian low-

income groups. The product is sold in three variants on the Indian market; Tata Swach, Tata

Swach Smart and Tata Swach Smart Magic.

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CHAPTER - 3

PROJECT PROFILE

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3. PROJECT PROFILE

The project profile has two phases, the first is the training and the second is the front line

sales profile along with the research process.

Training

The first week we were trained on marketing concepts that are popular in HUL pure it

division for direct sales.

In the training, awareness of the features of the product, their working process was created

and we were given practical training through many cases of live selling and demos. The

product was also shown to us in the class room and full training on ODPEC process of direct

selling of the product is given.

ODPEC

O - opening the call

D - developing the need

P - presenting a solution

E - eliminating doubts

C- closing the sale

Opening the call is done where in it is the mode of getting prospective customers for pure it,

it involves contacting customers and creating awareness of the product, if we manage to

make 60 contacts then 6 deals of getting closed are expected some times that may happen less

or more but this is what in an average believed in HUL pure it.

Developing the need plays an important role in the decision making process by starting the

need of pure drinking water. Invoking the need by raising basic questions.

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Proposing the solution is giving the consumers the awareness of purified water by HUL pure

it and the benefits of it and protective and keep the family secured from water borne diseases,

then start with the demo of the product and explain the features of the purifier and various

models of the product.

Eliminating doubts is the process of giving clear idea to the consumers, clear all the doubts

raised by them and ensuring the customers that the product is the perfect solution for their

need.

Closing the deal is to identify the buying signals from consumer and giving the closing

statements to the consumer by asking their colour preference, delivery and payment options

.

Internship profile

My designation was hybrid pure it water expert which purely involves direct sales giving

me the opportunity to interact with number of consumers and retailers. The job involves three

process in a day

Cold calls and out reach

Door to door

Retail outlet

The day starts with the meeting held by the territory sale officer in a common place where all

the team leaders and hpwes gather and report the previous day activities and results. An area

was allotted under a team leader where the above mentioned process were done. The main

idea of the door to door visits is to spread awareness among the consumers and generate leads

of the product.

Contacts that are obtained during the door to door are entered in the Non symphony hpwe

diary provided by the pure it division and make cold calls for the follow up to the consumers

who are interested. This process goes on till lunch time after which we are directed to the

allotted outlets to proceed with frontline sales.

The retail outlets are of two types

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Symphony

Non symphony

Symphony outlets are those big consumer appliances outlet where the frequency of sales and

no of sales are very high whereas non symphony outlets are small and sales are low.

The second part of the day involves sales in these non symphony retail outlets which are

allotted by territory sales officer. The main purpose of me there is to attend the customer in

the outlet and try to convince the customers to buy the product or close the call and to get

their referrals which may lead to a prospective customer. The major part of the sales has been

done from these outlets.

A study was done on consumer purchase behavior of water purifiers.

OBJECTIVES OF THE STUDY

1. To study the Consumer Purchase behaviour (expectations) of water purifiers.

2. To study whether HUL purifiers meets the consumer expectations(gap).

3. To perform comparitive study of HUL purifiers with competitors in meeting

consumer expectations.

METHODOLOGY

Research Methodology is a way to systematically solve the research problem. In it, step-by-

step methods are followed to solve a particular problem. It refers to a search for knowledge. It

can also be defined as a scientific and systematic search for pertinent information on a

specific topic. It is an important tool to study buyers behavior, consumption pattern, brand

loyalty, and focus market changes.

I followed a process of gathering and analyzing primary and secondary data in order to arrive

at the conclusions presented at the end of this paper. In this research I used internal databases

as well as reports from companys associations for knowing about the competitors and for the

data and statistics used in the report. This is purely a Descriptive research Study conducted

with both Primary and secondary data.

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DATA COLLECTION

The data can be of two types:

Primary Data

Secondary Data

Primary Data are those data which are collected exclusively for a specific project. In this

research the Primary data is collected through the structured questionnaires. These

questionnaires were circulated through different mediums and some inputs were taken by

person assistance method.

Secondary Data are those data which are already collected and stored and which has beenpassed through statistical research. In this project, secondary data was collected from

following sources:-

Annual Report

Articles in Journal, Magazines.

Books

Other material and report published by company

Questionnaire: The inputs from the review of literature helped in the questionnaire

formation. Important attributes were identified and incorporated. Also, the research

objectives helped to identify the nature of questions needed to ask.

Sampling Method: Convenient sampling method is used in this research, I have been to various

retail outlets both symphony and non symphony to collect data and also circulated questionnaire

through e-mails for data collection.

Sample Size: The sample size used was 100

Tools and Methods Used: The software packages used for analysis of the data are SPSS

(Statistical Package for Social sciences) version 14.0 and Microsoft Excel. Excel has been

used to generate a variety of charts that will graphically present the data and give a clearer

picture of the same.

Factor Analysis: Factor analysis attempts to identify underlying variables, or factors, thatexplain the pattern of correlations within a set of observed variables. Factor analysis is oftenused in data reduction to identify a small number of factors that explain most of the variance

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observed in a much larger number of manifest variables. There are many different methods

that can be used to conduct a factor analysis (such as principal axis factor, maximum

likelihood, generalized least squares), there are also many different types of rotations that can

be done after the initial extraction of factors, including orthogonal rotations, such as Varimax

and Equimax, which impose the restriction that the factors cannot be correlated, and oblique

rotations, such as promax, which allow the factors to be correlated with one another.

LIMITATIONS OF THE STUDY:

Due to time constraint detailed research on all the parameters is not possible.

Due to financial, time, resources and other constraints, field work is limited only for

few geographical.

Research done might not be true representation of entire population (sample size

study is 150).

Respondents may not provide 100% accurate and true information for the surveys

which may lead to a variation in consumer responses.

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CHAPTER - 4

OBSERVATION AND ANALYSIS

Draft Report Hul

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