INTRODUCTION Indian Economy is dramatically changing the dramatic changes are the result of hard realities. Too much of protection for too long a time has hindered the economic development rather than facilitating it. The immediate fallout could be seen in public sector units in the country. Their losses got accumulated and became a drain of the National Exchequer. Too much of regulation for too long time on private sector had also proved to be disastrous. All these regulations, curbs and restrictions has stifled the enterprising spirit and discouraged healthy competition among the in industrialists. The balance of payments position became so unmanageable that even the international lending bodies like International Monetary Fund and World Bank refuse additional finance for India unless Indian economy is revamped. Since than a series of economy policies were revamped. There was a greater emphasis on Marketing. After liberalization the changed in economic scenario India offers excellent marketing opportunities are created for aspiring Entrepreneurs. Indian markets are now “Buyers Markets”. Therefore the marketers has to resign suitable. Strategies to stay successful in the market. Their success depends on their ability to cater. 1
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INTRODUCTION
Indian Economy is dramatically changing the dramatic changes are
the result of hard realities. Too much of protection for too long a time has
hindered the economic development rather than facilitating it. The
immediate fallout could be seen in public sector units in the country.
Their losses got accumulated and became a drain of the National
Exchequer. Too much of regulation for too long time on private sector
had also proved to be disastrous.
All these regulations, curbs and restrictions has stifled the
enterprising spirit and discouraged healthy competition among the in
industrialists. The balance of payments position became so unmanageable
that even the international lending bodies like International Monetary
Fund and World Bank refuse additional finance for India unless Indian
economy is revamped.
Since than a series of economy policies were revamped. There was
a greater emphasis on Marketing. After liberalization the changed in
economic scenario India offers excellent marketing opportunities are
created for aspiring Entrepreneurs.
Indian markets are now “Buyers Markets”. Therefore the marketers
has to resign suitable. Strategies to stay successful in the market. Their
success depends on their ability to cater.
1
OBJECTIVES
PRIMARY OBJECTIVES:
To find out which factors has got influence on customer awareness in
Paints Industry.
To know the awareness level of “Asian Paints” customers as well as
other customers.
SECONDARY OBJECTIVES:
To identify the customer requirements.
To analyze the customers perception regarding the preference of Asian
Paint Products.
2
NEED FOR STUDY
The main objective of the study is to know the Customer awareness
with respect to Asian Paints.
The need for this can be explained if one knows the importance of
understanding the Customer awareness. So in the following paragraph
the Customer awareness and its role in the success of an organization has
been explained.
Customer awareness are taken up to boost the sales of a product by
the company. A company having production capabilities may produce a
product and price is according and sell through the dealers and retailers
by its distribution network.
Considering the fact that consumer according to the time need,
want and the purchasing power, it depends on the product, therefore, the
marketers rely on the marketing mix to cater to the customers efficiently
and effectively.
So the companies producing the product, pricing and planning
them have to care fully look into the minds of the consumers and place the
products favorably in the minds of the consumers.
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METHODOLOGY
In order to realize the study the objectives a considerably volume of
both primary and secondary data is needed. It has been therefore found
necessary to conduct an Interview schedule for gathering relevant data
from the users.
Primary Data has been collected from the industrial buyer during
May – June 2004 with the help of a structured Questionnaire with
stratified sample of 65 respondents have been taken for carrying out the
study.
Secondary Data the information regarding the Indian paint industry
has been drawn from various published sources. They include
Professional business Journals and Magazines, besides the News papers.
The data relating to Asian Paints has been collected from company
records.
This study is necessarily based on the limited knowledge and little
practical exposure the constraints of resources and time have further
imposed limits to the study boundaries.
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LIMITATIONS
The respondents of the questionnaire are very busty and could not
afford more time to answer. The average time to response was 5-6
minutes only.
A limited sample size of 65 customers was considered because of time
constraint. An assumption is made that the sample represents the
whole population. It will not carry the total reflection of the copier
market. Total sample size is comparatively less to represent the entire
population.
A time period of only 45 days was allowed for the completion of this
product. So considering all the consumers for the study was not
possible.
The data was of primary nature. So the degree biases were relatively
high as the sample was randomly selected.
Study restricted to geographical territory of Visakhapatnam city only.
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PAINTS – THE COLOUR OF OUR LIFE
(A PROFILE)
What is Paint?
Basically, Paint is a mixture of four elements.
Solvents
Binders
Pigments
Additives
Solvents
Which give a paint its flow, and enable it to be brushed on a surface
Binders
Which hold the paint together, as well bind it to the surface that is
painted, thus giving its property of durability.
Pigments
Which give paint its colour and opacity.
Additives
Which give paint special properties such as resistance to fungus, rust ..etc.,
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Paints can be distinguished as
EMULSIONS :
These are water based paints Acrylic Emulsions are extremely
durable and give wall silky and smooth finish. They washable and easy to
maintain.
Eg: Asian Paints offers three brands to choose.
Premium Apcolite Royal Acrylic Emulsion.
Medium Apcolite Super Acrylic Emulsion.
Economical Super Decoplast.
DISTEMPERS:
These are also water based paints but their binders may be very
natural or synthetic. Distempers are economically priced, they offer good
value for money as they are durable.
Eg: Asian Paints has
Tractor Acrylic washable Distemper.
Tractor washable Synthetic Distemper.
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LUSTER AND MATT FINISHES:
These are solvent based paints are extremely durable. The former
gives a gloss egg shell finish while matt finishes have a dead matt finish.
Eg: Asian Paint has
Apcolite luster finish.
Apcolite synthetic matt finish.
EXTERIOR FINISHES:
For exterior cement paint is mainly used as it is economical. It also
has a reasonable life if in areas where monsoon is not too heavy.
Eg: Gattu cem.
ENAMELS:
It provide the best coating for metals they are tough, durable, glossy
in finish. The smooth shiny look lasts for years. Enamels protect from
corrosioin.
Eg:
Apcolite Synthetic Enamel.
# mangoes Synthetic Enamel.
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PRIMERS:
Primers are usually the first coat applied on a surface it is meant to
prepare the surface for painting. It offers protection to the paint.
Eg:
Asian Metal Primer.
Woodorite Primer.
FILLERS / PUTTIES:
It is used to fill up the crises or any unevenness to ensure that the
finish coat gives a smooth surface.
AUTOACQUER:
It is NITRO CELLULOSE paint for auto finishing.
Eg:
Krilo
Apca
Aspa
9
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PAINT INDUSTRY IN INDIA
Foundation for paint was laid in the year 1902 with the setting up of
Shalimar Paints in Calcutta. It was during the and after the World War II.
That large number of paint manufacturing units was set up in India. Since
then the Indian paint industry has made substantial progress.
The paint industry has come to the recognition as an important
sector in the national economy in producing industrial coating and
decorative paints. Decorative paints available in wide range of
combination account for 70% of the coatings total production. While
industrial paints share the balance of 30%. This rate is diametrically
opposite to the trend in the industrialized countries where industrial
paints account for 70% and Decorative paints for the balance of 30%.
The Indian paint industry is at the crossroads. All most all-major
paint companies have expanded or are expanding its capacity
substantially. With demand rising slowly competition is becoming
increasingly intense.
The decreasing growth rate has made the paint companies to woo
customers aggressively. The customer is being offered 10% rebate in most
products, Unheard in the industry so far. Most companies have increased
their discounts to their dealers to unimaginable level dealers are offered
higher credit levels, flexibility in payment, foreign trips for selling even
low value products and the like. The increasing competition to offer
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solutions through technology has made all the paint make as offer a large
number of shades through computerized colour dispensing system.
IMPORTANCE
Generally paints and coatings are applied to products to protect
them from
Emnvironmental Corrosion.
Protection of Food and Beverages in metal cans.
Improve aesthetic appeal.
CATEGORIES
Paints are classified into two broad categories.
Decorative or Architectural finish paints.
Industrial Paints.
Decorative or Architectural finish paints:
This market can be further segmented on the basis of the following
Customer types : Institutional / retail or domestic use
Product features / categories: Distempers, Enamels, emulsions etc.
Price: Premium, Medium, Economy etc.,
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Industrial Paints:
This market can be further divided into the following four sub
segments depending on the end user profile.
Automotive paints.
Marine Paints.
Powder Paints
High Performance coatings
Other general industrial finishes.
In India, decorative paints dominate with the share of 75% of the
total paints consumed while in developed countries Industrial paints have
a share of 50 – 70%.
Decorative Paints used in buildings include distempers, emulsions,
synthetic Enamels, Cement pains and Wood finishes. Interior Paints
makeup of the segment. The rest is made up of exterior paints mainly
cement paints.
PLAYERS IN DECORATIVE PAINTS
In decorative paints Asian Paints dominates with a 37% market
share and number two player Goodlass Nerolac has a market share of
14%. These paints are by medium technology and hence the unorganized
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sector has a major share. A recent estimate that over 2400 companies are
in unorganized sector.
INDUSTRIAL PAINTS
Industrial paints include automotive paints (original auto
manufactures and refinishes), Powder coatings marine paints high
performance coatings and special purpose finishes. These are technology
intensive and hence the presence of the unorganized sector is very limited.
In fact, there is no presence of the unorganized sector in the original
paints. This can be explained by the fact that to bag an order from
automobile manufacturer collaboration with a well known foreign paint
company is a must Goodlass Nerolac is an un disputed leader n industrial
paint.
Till early 90’s paints were treated a s luxury items by the
governments this resulted in higher excise duty and higher end prices,
leading low consumption of paints in India. However the progressive
reduction of the excise duty from 40% in 93-94 to 18% in 96-97, the
companies have passed on the duty reductions as price cuts.
However the per capita consumption of India is still a merge of .5
kg compared to 26 kg in U.S and 1.2 kg in Thailand.
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As already mentioned paints were viewed as luxury item by many
even today. Their productive value is not under stood and repainting is
limited and if ever done is once in 7 – 10 years. The government interest
to protect all surfaces is also low and the loss due to corrosion is estimated
to be over Rs. 5000 crores p.a. By the central Electro chemical Research
institute at Karaikad, Tamilnadu.
With a view to emphasing the importance of protection through
painting the Indian paints Association (IPA) had brought slogan in 1995
“Paint and Protect”. This slogan is popularized through various
communications however a lot needs to be done to reach the millions of
customers effectively.
DEVELOPMENTS IN VARIOUS SEGMENTS
Two significant developments took place in the last three years in
the decorative paints segment.
Advent of Computerized Colour Dispenser
Sudden increase of Exterior Market.
Colour Dispenser:
Traditionally companies used to supply pre mixed shades to dealers
who in turn offered to their customers.
Asian Paints brought in the manual colour dispensing concept in
1998 and offered 151 shades through it. This was the first salvo in offering
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in variety of shades. This concept took off and Asian Paints went about
establishing 2000 colour corners which would stock the 151 shades.
Additional shading requirements were catered by providing colours as
per the demand after mixing the bases with strainers through colour
dipencer other companies followed it soon and Goodlass Nerolac
introduce ed 301 shades under the same concept.
In 1995 Jhenson and Nichelson, the 5th ranking company in the
industry, pioneered the concept of CCD. And started installing them at
dealer shops with the support of TIKKURILA of FINLAND.
The concept is similar to that of the manual colour dispenser except
that the dispensing is automatic pre decided formula registered in the
computer and the shades are offered instantly shops to customers.
Today Berger Paints, is the 2nd Company to enter this system
offering 5000 shades a clear indication of the trend. In the year 1997-98
has seen the introduction of the concept by the two giants. Asian Paints
and Nerolac. Today around 1000 dealer shops are installed this concept.
CCD or it is called “AUTO COLOUR DISOENCER” have helped the
dealers to reduced their inventories offer a large variety of shades
instantly, consistently and accurately. Consumer have also benefited by
this concept as the shopping environment has changed dramatically with
the advent of CCD.
EXTERIOR MARKET
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The second development is the introduction of the 100% Acrylic
Exterior Paints and the focus of major companies on the Exterior Paints
market. Traditionally, the exterior paint market was catered to by
KILLICK NIXON and several other small players. The main offered were
cement paints in India. But the real change has be thought by Asian Paint
through APEX – its 100% exterior paint market has started growing
exponentially. In 1999 Nerolac introduced EXCEL in the category and
offered qualitative product at low material cost. Both Apex and Excel
have propelled the exterior paints growth by over 60% in 2002 and the
trend is expected to continue for at least of three more years.
A major development in 1997-98 was the “Pay by scooter / car”
concept by companies. As practiced in western countries, in India also the
concept of taking care of the complete painting job has been under taken
by paint companies. Goodlass Nerolac has commenced this concept with
Mahindra cars by managing the entire paint shop and being paint on the
basis of per painted cars. Asian Paints also followed it up with a similar
tie up with LML for its scooters.
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POWDER COATINGS
The other “industrolycoat powers”, in collaboration with VAISPAR
CORPORATION of U.S.
Higher performance coatings is another rapidly growing segment
which is used at fertilizer / sugar plants, airports, big construction
projects, Berger, Asian., Nerolac dominates this segment due to their
international collaborations and high quality range of products.
PAINTS DEFINED
Technically paints can be defined as a homogenous fluid made from
our ingredients namely pigments, resins, solvents and additives which the
raw materials can be classified into four categories. A typical paint
formation consists of over 500 input materials.
However the key raw materials are
Pigment:- Titanium dioxid
Resins:- PAN,Pentaerythrill
Together these constitute 40-50% of the total raw material
dependent on the category of paints.
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To conclude the following are the critical factors in success in
decorative and industrial paints.
DECORATIVE PAINTS
Managing logistics
Managing input costs
Focus on rural markets and viewers segments
Strong marketing and brand equity
Quality and technology
INDUSTRIAL PAINTS
International technology
Consistent quality
Customers service
Competitive price
Continuous innovation.
PACKAGING
Asian Paints has four production plants and each has four distinct
packing pattern. So that the work of the godown in charge becomes easier
in recognizing the tins from which plant they have come.
The packing is as follows
Ankleshwar
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Bhandup
Patancheru
Kasna
And the products are packed as
Enamels 20, 10, 4, 1 liters
500, 200, 100, 50 ml
Distemper 20, 10, 5, 2, 1 kgs.
Emulsions 20, 10, 4, 1 liters.
PLANT IDENTIFICATION
Plant identification marks for cartoons, drums, tins are given below.
Bhandup plant
1. All liter number will be four digit starting from 1001.
2. Alphabets B as label indicate Bhandup plant
3. Drums will not have any brands on the top side
4. Cartoons will not be Blue in colour.
Ankleshwar plant
All liter number will be four digit starting from 2001.
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Alphabets A as label indicate Ankleshwar plant
Drums have one brand on the top side
Cartoons will red in colour.
Patacncheru plant
a. All liter number will be four digit starting from 3001.
a. Alphabets p as label indicate Patacncheru plant
b. Drums have two brands on the top, one dotted line.
c. Cartoons green in colour.
Kasna plant
1`. All liter number will be four digit starting from4001.
2. Alphabets K as label indicate Kisna plant
3. Drums have one brand with three dots with nine alternatives.
4. Cartoons are brown in colour.
PRICING
In the narrowest sense price is the amount of money charged for a
product or service .
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Price has ben the major factor in affecting buyer choice. This is still
true in poorer nations, among poorer groups and with commodity
products. However non price factors have become more important in
buyer choice behavior in recent decades.
With respect to Asian Paints there are two price lists.
Dealers price list
Maximum price list.
Dealer price list:
It is applicable to dealers and consists of their trade discount of 3%,
additional trade discount of 3%, cash discount 5%.
If written in equation
DPL = trade discount 3%
+ Additional trade discount of 3%
+ Cash discount of 5%.
Maximum Price List:
MPL = consists of dealers price list – trade discount 3% - additional trade
discount 3% - cash discount 5% + local tax.
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Those dealers who has regular payment of performance are
benefited largely by cash discount and those dealers whose payment is not
regular do not get products.
The company operates at a very low over due outstanding rate.
Thus it can be said that the company has very stringent rules regarding
the credit given to the dealers.
PROMOTION
Modern marketing call for more than just developing a good
product pricing attractively and making it available to the target
customers companies also must communicate to their customers and what
they communicate should not be left to chance.
Asian Paints promotional activities consists of advertisements,
schemes, point of purchase, painters schemes.
The advertisement activities are given to OGILVY AND MATHER
who has designed the advertisements as shown and partly by contract ad
agency.
TARGET GROUP
According to the information provided by the company personnel
the target group differs from product to product.
Eg:
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Utsav - rural (chunna and distemper)
Distemper - middle income group
Royal - higher income group
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FACTORS BEHIND SUCCESS OF ASIAN PAINTS
Asian paints was founded in 1942 as a small Indian partnership firm
at a time when the paint industry was fiercely competitive. Two
marketing breakthroughs propelled the company to leap into the
decorative segment. The first was the introduction of smaller sized cans
into the market where the paint was sold in bulk. The second was a dealer
expansion thrust to reach out to end customers and offering them quality
paints which were hitherto available to them in the urban areas only.
These two steps meant going beyond selling paints and, in particular
responding to the customers unmet need. The result was that in 1967,
Asian paints captured to the top position in the decorative paint segment.
Today the company is not just a leader in the paint industry but sells twice
as much paint as any other company in India. In 1994-95 the company had
a turnover of Rs. 614 crores and 38% share of the organized paint market
Marketing Strategies
The success of Asian Paints is primarily attributed to marketing
acumen. The company has made excellent use of the electronic and print
media, besides publishing informative brochures for all its products. The
company’s mascot “Gattu” created to give an ethnic touch has almost
become synonymous with the generic product.
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Critical Success factors – Distribution
The marketing success of Asian Paints was based on the realization
that the semi-urban was untapped and the small consumer neglected. To
reach those consumers in small town, the company built a broad
distribution network across the whole country. From small towns Asian
Paints moved to reach out to the metropolitan market. Today, the
network with 17,000 retailers across the country is making the company
responsive to a large customer base.
Use of Information Technology
To strengthen the distribution network, the company has gone in
for computerization at the branch and the depot level. All branches and
45 depots across the country are connected to the four plants and the
Product Management Group at the Head Office through the VSAT. The
use of the IT has meant faster flow of information, more efficient
management of supplies, and better inventory control.
Width of Product Line
Based on the surface on which they are applied, decorative paints
are usually classified as wall, metal, wood and plastic finishes. The
products could be emulsions, enamels, varnishes, automotives, or
undercoats. Their end use could be in the sign board, bus body, industry
or household segments.
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Asian Paint has offered brands in all possible applications. For