Vanish Case Study

CASE STUDY COMPETITION

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EVENT FORMAT

Stage 1: Participants of each college must battle it out amongst themselves to decide the

best two teams. Campuses are free to decide their evaluation criterion.

Stage 2: The Best Two Entries from each college must be sent to us at [email protected]

by 23:59:59, 12th November, 2010. This may be routed through the Placement

Team/General Secretary.

Stage 3: Grand Finale – Held at North Campus, Delhi University for the best 6 teams on 24th

November, 2010.

RULES AND REGULATIONS 1. Event is open to the Full Time Programs (both years) of the following B-schools

1 IIM A

2 IIM B

3 IIM C

4 IIM L

5 IIM I

6 IIM K

7 FMS

8 ISB

9 XLRI

10 MDI

11 IIFT

12 IMT, Ghaziabad

13 SP Jain

14 Jamnalal Bajaj

15 NITIE

16 IIT DMS

17 IIT Shailesh J Mehta

18 IIT Kharagpur, VGSOM

19 NMIMS

20 MICA

21 XIMB

22 TISS

23 SCMHRD

24 SIBM, Pune

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2. Maximum number of members in a team is two. Each team can submit a maximum of 1

entry.

3. No participant should be part of more than one team.

4. Any number of teams from an institute can take part in this event. However, only two

entries must be sent to us at the end of the campus evaluation round.

5. The Top 2 entries from each college are required to be mailed through the Placement

Team’s ID or the GSec’s ID latest by 11:59:59 PM, 12th November with the Subject as

Vanish_<Institute>

6. Each entry should be in the form of a Word Document (2003 format) named as:

Vanish_<Institute>_<TeamName>

7. Members of the final selected teams would be reimbursed 3 Tier AC Tickets (both ways).

The selected teams would be required to submit original tickets for the same.

8. The decisions of the panel of judges will be final and binding on all the participants.

PRIZES 1st Prize: Rs 1 Lakh

2nd Prize: Rs 60,000

3rd Prize: Rs 30,000

All the 3 Winning Team members will also get Pre-Placement Interviews from Reckitt

Benckiser.

CONTACT DETAILS

1. Reetam Ghosh

[email protected]

+91 9650695109

2. Anurag Goyal

[email protected]

+91 9650695158

Facebook Page: Like our Facebook page for regular updates:

http://www.facebook.com/pages/Vanish-Case-Study-Competition/114329991962574

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Vanish – Challenge of Removing Stains and Banishing Detergents (Case developed by Prof. Harsh V. Verma, FMS, University of Delhi for Reckitt Benckiser India Limited) The still in the room was palpable. The fluttering of papers on the table created noise, which usually went unheard but could now be heard loud and clear. The meeting last evening with the marketing director had some unsettling effect on the brand manager of Vanish which sent him in a deep thinking mode. How can the penetration level of the brand, which enjoys leadership position worldwide in stain remover market, be increased? Even after four years of its launch it continues to struggle with abysmal house hold penetration level of 1.1%. Working with a company like Reckitt Benckiser (RB) in India was a great thing for here was an organization which led the categories it operated in. Name a category in which RB operated, try naming its leader and it would be an RB brand. This is what people in Reckitt’s office at Gurgaon took pride in. But then this pride and pleasure also put a strong burden on the managers. The implicit norm here was that each brand must become a top seller. The meeting last evening was about the brand which had underperformed compared to other brands in the company’s portfolio, like Dettol, Harpic and Veet. The brand manager reclined the seat to have a more comfortable posture, simultaneously turning it towards the large window which allowed a peek outside. This probably was much more than a simple gesture to get some physiological comfort, rather an inner urge to get some out of box ideas to turn the performance of his baby Vanish around. The Pride RB is not an ordinary company. It is an extraordinary business organization with worldwide leadership position in household cleaning. The Indian arm Reckitt Benckiser India Limited is a fully owned subsidiary of RB. Prior to 1999 the Indian firm was known as Reckitt Colman, which was rechristened as Reckitt Benckiser after Reckitt’s merger with Benckiser NV. The company is truly global with its operations and sales spread in sixty countries and revenue in excess of $6.5 billion last year. The last couple of years have not been favorable to the businesses worldwide, especially in Europe and US. The economic slowdown affected one and all, irrespective of the nature of business. All this notwithstanding, RB exhibited very strong financial performance. The net revenues grew by a decent 13 per cent to € 6563m in 2008. The brilliant showing was a testimony to the ability of the managers of the company to navigate the company successfully even during turbulent times. This demonstrated that ultimately it is the strategy and its execution that matters and the leadership and employees are the driving force behind any system. Indian Operations The Indian counterpart, Reckitt Benckiser India Limited (RBIL), is a multi-product company which operates in several markets. These include personal care, pest control, shoe care, antiseptics, surface care and fabric care. Some of the well known brands in the company’s portfolio include Dettol, Mortein, Harpic, Clearasil, Brasso, Cherry Blossom, Lizol, Disprin and Colin. And most of these brands enjoy top positions in their respective markets. These are either number one or two in

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their categories. One of the reasons behind the success of these brands is product innovation and quality which allow customers to get superior product benefits compared to other competing products. Marketing equally plays an equally important role in brand-building efforts. Reckitt is one of the fast growing companies in India. Its growth is fueled by hugely successful star brands. For instance, Dettol, once known to be ‘the’ antiseptic liquid product in India to be applied for minor nicks and cuts, has evolved into a powerful brand concept. Now Dettol brand stands for much more than antiseptic liquid and supports products in other categories like soap, hand wash sanitizers and shaving cream. Cherry Blossom, the shoe polish brand, is leader in its category which has managed to keep the competition at bay by careful maneuvering of the marketing space. Accordingly, Cherry Blossom enjoys strong brand equity both with its business partners and the ultimate end customers. Harpic toilet cleaner, like other brands, has a long history. It was first launched in England in 1920. This brand enjoys a strong position in the toilet bowl cleaner market as a strong powerful cleaner. The company’s products need wide distribution set up in order to reach to its target customers. Some of the products typically fall in the fast moving consumer categories which require servicing a wide market area. RBIL uses its common distribution channels for distribution of its products which enjoy wide and deep reach in Indian market. This is one of the important strengths of the company. The channel system of the company is managed by its well structured sales force which is accountable for ensuring supply and sales of company’s entire product portfolio of more than one hundred and fifty stock keeping units. The Product Technically, a product is nothing more than the sum of its parts or components or ingredients. And this sum of parts may be the creation of an extraordinary genius, but is of little worth if it does not solve a customer problem. Stain remover, like others, is a product which embodies a great useful functionality of getting rid of stains from clothes. The idea behind the stain remover is that as long as people wear clothes and use fabrics they can not escape stains. People struggle to avoid stains, but this avoidance is never hundred percent successful. And this is where an opportunity for a stain remover is germinated. Thanks to mud, oil, grease, coffee, dust and food that soil clothes! Vanish is a product meant to remove stains. This is to be used as an additive to detergent. The product’s superiority is vouched by the fact that this is the number one in fabric treatment category worldwide. Vanish was the first brand of stain removers to have been launched in India, in 2005, and thereby creating the category of stain removers. Although the market for stain removers is still small but Vanish enjoys the leadership position with a close to 50% market share. Brands which create categories often walk away with first mover advantage unless some lapses happen in marketing. Like other Reckitt brands, Vanish lives up to the reputation of being the top brand in its category. Globally Vanish is perceived to be a trusted stain removal expert. As a brand, the source of its trust is the expertise in stain removing from fabrics as well as carpets. Thanks to its unique product formulation, with Vanish consumers can get rid of stains from their fabrics and carpets right in front of their eyes. The product comes in two application formats – in wash and pre-treat.

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Stains, detergents and washing bars Detergents and washing soaps is a big market in India. For washing, housewives use detergents in different forms like powders, liquid and bars. The detergent category is apparently divided vertically into three categories: the compact or premium, mid value and economy segments. The top end of the market, the compact category, is dominated by brands like Surf and Ariel. In the middle segment brand like Rin and Tide wrestle with each other and in the economy category wheel, Nirma, Ghari, Sasa, Hippolin, 555 and a host of other local brands fight for a slice of the market. Apparently, detergents and stain removers are two different products. Chemically these are two different formulations. And in terms of their functionality, these also perform different functions and utilities. One gets the dirt out and cleans the clothes while the other removes the stains. And from a pure technical perspective, these belong to two different categories. But what is inner reality is not the perceived reality. Both of these products intersect in marketing and brand building. Typically detergent brands are marketed with propositions including stain removal. And often the core value proposition of detergent brands tends towards the stain removal feature. HUL-brand Surf once ran a campaign with the statement ‘daag dhoonte reh jaoge’ (you will keep searching stains) and its current ‘daag acche hain’ (stains are good) campaign also focuses on stains. Thus, direct or indirect referencing of stains is very common in detergent brand building effort. The detergent market can be viewed to be consisting of three dominant benefit segments:

Tough stain removal (dominant brands include Ariel, Surf and Henko and other high-end detergents)

Dirt grim and regular stain removal and whiteness (Wheel, Nirma and other popular detergents)

Brightness and dirt removal (Tide, Rin and other mid-price detergents) Detergent market is not only competitive but also a home for many big players including HUL, P&G and Henkel. Accordingly detergent market is intensely competitive space. This necessitates companies to invest substantial amount of resources on both product development and marketing. Consequently, detergent brands attempt to add value to their core utility of cleaning with things like stain removal, fragrance and water saving. With the most common among these strategies being the stain removal. This marketing approach of detergent marketers acts to preempt the market for a product like Vanish. If detergents offer a complete solution for their need (sought at the time of washing) then what is the need for an additional product given solely to stain removal. It is a difficult situation for a brand like Vanish. The competitive intensity in the detergent market is forcing detergent brands to expand the value to fight with each other. The promised detergent functionality and benefits is spilling into the category of stain removers, which Vanish has created and seeks to dominate. The following are the samples of different detergent brands’ communication: Henko 2009: Key claim: Removes tough difficult stains Benefit: Complete stain removal Key stains: Coffee, Grease, Pickle, Mango 2010: Key claim: No stains, no germs Benefit: Oxygen power and anti-bacterial neem

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Key stains: No stain story Surf Excel 2009: Key claim: Tough stain removal Benefit: Complete assurance of stain removal Key stains: Ink, Mud/Grime, Orange juice, mustard, ketchup, curry, grease, pickle 2010: Key claim: Tough stain removal Benefit: Removes stains in 1 minute Key stains: Ink/water colour Ariel 2009: Key claim: Removes set in stains, No need to rub bars Benefit: Stain removal, clothes shine like diamonds Key stains: Oil, Food, Pickle, Fresh curry, mustard, ketchup 2010: Key claim: Doesn’t let stains set-in, so they go easily Benefit: Stain removal Key stains: Rust Rin Key claim: Double whiteness Benefit: Whiteness with proof Key stains: Dirt, Cuff/Collar grime Tide Key claim: Whiteness only with Tide Benefit: Whiteness that gives shine Key stains: Dirt, Mud, Grime Wheel Key claim: Removes dirt, stains without sweating Benefit: Value, less effort Key stains: Dirt As long as customers see detergents offering the benefit of stain removals, the market for Vanish will be adversely affected. The challenge is how to get consumers to believe that Vanish gives them something that detergents do not. The Launch RBIL launched Vanish in India in 2005 in a powder format under the brand name Vanish Shakti 02. Within two years, in June 2007, the company re-launched the brand with new improved formula adding the word ‘Max’ to the existing brand name (Vanish Shakti 02 Max). The product was reformulated to give it more power so that even dried in stains could be easily removed. The product is an effective remedy for tackling the toughest of stains. Till the end of 2009, after the four years of its launch, the brand has not been able to achieve higher levels of market penetration. It current penetration level is a mere 1.1% of all-India HH. Confronted with this reality, the brand team of Vanish has been putting all efforts they could to achieve higher

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penetration of the product in Indian households. One of the recent outcomes of this endeavor has been to get into consumer homes by inducing trials. Context of Washing and Research Findings ‘Marketing a product like stain remover requires deeper understanding of the context in which it is used by the consumers,’ feels one of the members of the marketing team. Therefore, the target of achieving greater penetration levels to build volumes must begin with understanding the total backdrop in which stain remover is placed. The strategy must be built on consumer insights. ‘A consumer would walk down the store and ask for Vanish only when first the product and then the brand is perceived to be relevant and meaningful in their life context,’ asserted the member of the marketing team. Driven by the motivation of gaining deeper understanding of the fabric care phenomenon, a research was commissioned which threw up several interesting facts: Method of washing: on the question how clothes are actually washed by people the research revealed that it is done by hand. The following figure shows methods used by people in washing.

Washing by hand is most common in India.

Once a day Once a day

2-3 times a week

Once a day Once a month Less often than

once a month

Lower incidence of washing machines

Median

values

67% amongst people with maid

70% amongst SEC A

Once a day

3 or more times a day

Machine Wash Hand wash

Total 12.6 15.6

Mean number of

washes per week

Reasons: Washing by hands is a common phenomenon in India. People do is for several reasons. The following table lists the reasons for washing by hands.

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Reasons for washing by hands:

All

Base: All using washing machine and hand wash %

When you have to wash delicate fabrics such as wool or silk 40

When the clothes can be washed by hand only 39

When washing delicate garments such as lingerie / hosiery 29

When the colours of the garment bleed 27

When I don’t have electricity 26

When the wash load is too small for the washing machine 25

When the clothes are not very dirty 23

When I have a very tough stain that requires scrubbing by hand 22

When washing baby’s/ children’s clothes 22

When it’s more hygienic 20

Because garments can be stretched/ loose their shape in a washing machine

18

Because it’s better for the environment 16

Because it uses less energy/ water 16

Because I get a better quality wash when wash by hand 15

When I don’t have time to wait for a full washing machine cycle 12

When I don’t have running water available 10

Types of stains and consumer annoyance: Stains are the obvious targets to removal for Vanish. The presence of stains in consumer life is the reason for the existence of a product like Vanish. And consumers do not want stains in their lives. How do stains on the clothes or fabrics arrive? What types of stains are frequently occurring and how much annoying are these? The research mapped the stains on the dimensions of incidence and annoyance. The mapping is given as under:

Experience every/most washes

Ver

y an

noyi

ng

Food Stains– experience every/most

washes vs very annoying

High Incidence

Low Annoyance

High Incidence

High Annoyance

Low Incidence

High Annoyance

Source: Q3p, Indicate how often you deal with each of these types of stains,

Q3q, How annoying do you find each type of stain to deal with?

Sauces/Condiments

Tea

Cooking Sauces

Tea is her most frequent and most annoying stain…

Low Incidence

Low Annoyance

Greasy food stains

Butter/Oil

Fruit

Baby Formula / Food

Vegetable

Dairy

Curry / Other Spices

Red Wine

Cola/Soft Drinks

/ Chocolate

CoffeeFruit Juices/

Egg

Other food / drink

Ice cream

Jam/Spread

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Experience every/most washes

Ve

ry a

nn

oyi

ng

Low Incidence

Low AnnoyanceHigh Incidence

Low Annoyance

High Incidence

High Annoyance

Low Incidence

High Annoyance

Source: Q3p, Indicate how often you deal with each of these types of stains,

Q3q, How annoying do you find each type of stain to deal with?

Ink/Marker

… along with cuffs / collars and dirt / mud

Non-Food Stains– experience

every/most washes vs very annoying

Vomit

Mould/MildewHair Dye

BloodDirt/Mud

Cuffs & Collars

Deodorant

Lipstick/Cosmetics

Grass Stains

Baby Stains

Toothpaste

Grease/Motor Oil

Other non food stains

Rust

Pollen/Flowers

Paint/ Varnish

Other body fluids

Medicines Sweat

Stain remover product usage: stains being a common problem with different levels of annoyance households do use specialized products for this job. Stains are removed by consumers using both home remedy and specialized products. The use of some specialist stain remover treatment in households was found to be 42% in Delhi, 23% in Chennai, 28% in Kolkata and 20% in Mumbai. Reasons behind non-usage of specialist stain remover products: the brand Vanish can move up on the sales ladder only when the idea of using a specialized stain remover product is perceived necessary. Although the incidence of stains is a pervasive phenomenon yet the product usage is lower. This suggests the presence of some kind of barriers which prevent people from using the product. Accordingly the reasons for not using the specialist stain removers were probed. The following responses were found on the question ‘why do you never use specialist stain removal products?’

Reasons % of total market

Too expensive 28

I don’t believe they work 21

Spoils the clothes 21

Rinsing/brushing straight away is the most effective way 18

Didn’t know products existed to treat stains 17

Haven’t felt the need for one 16

Laundry detergents are sufficient 15

Affects color of the clothes 15

Harsh on skin 13

I rarely have stains on clothes 12

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Reasons for not using brand: the customers were further probed on the issue as to why they do not use Vanish. The following data was generated in response to the question: ‘Why do you not use Vanish?’

Reasons % of total market

Too expensive 42

I don’t know what they do 16

Harsh on the skin 14

I don’t believe they work well 14

I don’t have a use for their products 13

I don’t’ know/ when to use them 11

Not environmentally friendly 10

It is too aggressive/ harsh on my clothes 9

Not safe for children’s clothes 8

Damages color of the clothes 8

Not available where I usually shop 6

Contains too many chemicals 5

Spoils the clothes 5

No particular reason 26

Customer treatment of stains and its effectiveness: on the issue of how effective is the consumer’s current method of stain removal two questions were asked to discover the reality. First do stains still remain even after consumer has treated them and second if the stains still remain even after their removal treatment what steps to do they take to get rid of them. 44% of women find stains cease to exist after their treatment but 56% find the stains to be still present even after they are treated. If the stains still remain after they have been treated what do women do to get rid of them? They resort to the following:

Steps taken % of respondents

Wash items again by hand 54

Use laundry blue 42

Scrubbed/soaked them 29

Use laundry bleach 27

Do nothing- live with stains 24

Wash item again by machine 20

Tried a different pre-treatment product 19

Nothing- decided not to use/ throw away 19

Used fabric whitner 16

General household chlorine bleach 13

Treatment carried out after washing 11

Tried different in-wash product 9

Items taken to a professional cleaners 3

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Market penetration of stain removers The brand manager while looking out of his window and staring into wintry haze was struck by the observations made by various marketing team members in the last meeting. ‘Low penetration of products specially formulated to remove stains is a major obstacle to Vanish garnering more volumes. It is further compounded by the low per capita consumption’, opines one member of the marketing team. The data on the stain remover category penetration are given in the exhibits. ‘These bar diagrams under different headings/ titles are provided to us by the research company but these require serious interpretation then only meaningful inference can be drawn,’ says another member of the team. ‘There are strategies which most managers employ and then there are effective strategies which only a few managers use. This is what marks crucial difference between high and low performance. Great strategies are based on insights which require out of box thinking,’ he added. He remembered a new management trainee who happened to be part of the meeting having reluctantly observed, ‘The research inputs provided to us by the marketing research company apparently look complete but simply questioning the users or non users as to why they use a product or why they don’t often does not reveal the true consumer reality. It may require more indirect probe to fully appreciate the psycho-social context in which consumption occurs’. The Way forward In March 2010, a complete re-launch of the brand was done again. This time the marketing of the brand was revamped. Specific and concrete changes were executed in marketing mix elements: Product: new formula was created that ensured better stain removal benefit in order to reinforce its superiority over detergents Packaging: packaging was redesigned to convey superior stain removal efficacy and use instructions in simplified manner Price points: lower price packs to induce trails (120 gms @ Rs 35 was replaced with 90 gms @ Rs 29) Building recall: celebrity endorsement route was adopted and actress Sridevi was used in brand communication Advertising idea: the brand’s advertising focused on establishing the functionality (superior stain removal) and its relevance for the consumer (housewife’s victory over her battle with stains) The lower penetration level of Vanish continued to bother the brand and marketing team of Vanish. A case was built with in the company which suggested that if the brand needed to achieve higher household penetration levels it must strategically address some of the critical issues. Many opinions and observations flashed in the mind of brand manager:

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‘The brand must be strongly differentiated from detergents otherwise consumer would continue to use stain removal from detergents’. ‘There is a need to establish brand’s equity as stain removal expert- expertise positioning.’ ‘Consumers must perceive value for money in the product. The higher price point discourages trial.” ‘The brand must forge emotional hooks and create relevance not only in terms of stain removal (functionality) but also emotionally.’ Consumers must see a need for a specialist stain remover in their laundry. But the challenge still confronted him…. ---------------------------------------------------------------------------------------------------------

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Exhibits

Market Size and Vanish share trends – Value

Figures at the top of the rows, in black & bold – absolute value (Rs Mn) Figures in blue – value share

Any Stain Remover Penetration & Consumption 2009 – Metros

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Any Pre-Post Penetration & Consumption 2009 – Metros

Bleach Penetration

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Vanish Penetration & Consumption Trend – 6 Metros combined

Vanish Penetration & Consumption 2009 – Metros