Silky routers Rural marketing casestudy on product strategy

Rural marketing case study-Product strategyPresented by

Deepak.RP2MBA 13022

Amrita School of Business, Amritapuri

Started in 1983 by C.K Ranganathan

Based in Chennai- distinct player in shampoo market

170 crore products player ( 2000)

“Cavin” the word denotes beauty & fairness in Tamil

29-11-2014 2Amrita School of Business,Amritapuri

Shampoo Market

CavinKare Shampoo business has grown 34 % in 2000 , faster than the

overall market

The current size of shampoo market according to ORG-MARG is Rs. 850

crore, equivalent to 30,000 tonnes in vol. Unit

The present penetration is only – 18%

Market share Company Market share

CavinKare 19.8%

HLL 65%

P&G and others 45.2 29-11-2014 3Amrita School of Business,Amritapuri

Aim of the company

Achieve Rs.5000 turnover in the next 10years!!


Major players in Market (2000)


National level

Competitors

National level productsRegional players


Entry barriers to new entrants

New entrants are discouraged by formidable task of establishing a

distribution channel from scratch.

HLL’s long established ties with retailers and extensive distribution reach

act as a entry barrier.


Major barriers to shampoo use

1. Shampoo contains harsh chemicals

2. Glamour product rather than a hygiene product

3. The high price


Success routes of

While other products are at 2 Rs.

Introduced sachet at 50 paisa

Brand expanded 40% after this

Trimmed HLL’s volume share by 2-3%

Smaller sachet of Chik @ 1 Rs.

Scaled down versions of its brands

Rural market is the key driver for sachets ,which makes up to 70 % of total shampoo sale !! HLL has the highest market

share at rural market of 80%


Success routes of

Introduced - Herbal shampoo Nyle

Was one of the earlier entrants in Indian

herbal shampoo market

One among top 5 herbal shampoo brands in

the country

Accounts for 10% of market size


But ....

HLL came up with LUX shampoo at 50 paisa

Bubbled packet of 30ml clinic plus


Distribution of

CavinKare has 2,200 stockist , and have presence in 6 lakhs out lets

including Kiranas in small villages

Company has been concentrating on few pockets in south and North class

1 and 2 town

Company is trying to improve its distribution in metros in one hand and

rural in other hand.

Company has decided to strengthen its distribution structure by using

**SAP R/3 package

Has also undertaken special rural drive with exclusive stockist for rural


Promotion of

As 50 % of the people in rural market do not have television CaviKare uses

“Video on wheels”

Sample distribution


Ways to expand the shampoo market

• Bring the perception that shampoo is a not glamorous product

Example: antidandruff, oil clear

• Offer premium Product: offer more functional benefits , add-ons helps

to increase the price and position the brand as premium

• Moving across category barriers: Medicated anti dandruff shampoo by

Johnson and Johnson


Philosophy of Mr.Raghunathan

• It is not good enough to know how to play the game properly.

Sometimes a win is possible only is you change the rules of

the game!!

As a result of this philosophy

1. Low unit packs was introduced

2. Saffron and milk combination in Fare Ever

3. Brand extensions are research based- Incorporate new findings and re

launch the brand


Corporate Strategy of

CavinKare will never venture in to marketing will only focus on brand

building, R&D , and distribution management, Company have 3 rd party

manufacturers.

CavinKare will never undertake to distribute products of other

manufacturer.

They will not let their products to be distributed by other people.


1. In shampoo market crowded with varieties ,

how could CavinKare make its mark?

2. How can CavinKare gain larger share in

shampoo market in future?



Silky routers Rural marketing casestudy on product strategy

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