please help! Marketing Essay ___________________________________________________

ID: 339577 • Letter: P

Question

please help! Marketing Essay

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Imagine you are an entrepreneur launching a business planning to operate both domestically and abroad. You are currently developing your marketing plan and strategies.

Develop a 1,050-word analysis addressing the following:

Describe your organization's mission, vision, and values.

Explain how these values will be aligned to your own personal brand identity, ethics, and values when doing business, planning strategies, and solving problems.

Discuss at least two concepts from class that are elements of a marketing plan and are important tools to your entrepreneurial business' success. Discuss how the concepts help align the organization's values with your values. Explain the reasoning leading to these conclusions.

Select two of the following departments and explain marketing's role in coordinating their distinct functions:

Distribution

Customer Service

Advertising and Public Relations

Research and Design

Sales

Operations or Manufacturing

Compare and contrast how culture is likely to impact domestic marketing strategies versus what the company may encounter when doing business abroad such as cultural norms, economics, politics, and legal systems.

Explain the actions the company can take to ensure that it evolves with the target at home and the countries it does business in.

Discuss any emerging marketing trends that may affect your business.

Explanation / Answer

Background

Parent Company Nirma Ltd

Category Home Care brands – detergents & soaps

Sector FMCG

Tagline/ Slogan ‘Sabki Pasand Nirma, Washing Powder Nirma’

USP Product with low price without compromising on quality

Segment Economy Segment

Target Group All Indian households and laundry stores

Positioning Quality at very affordable price

Competitors Ariel, Surf Excel, Tide, Wheel

History

A little girl in a frilly white dress twirls her way into a pack of detergent, to the tune of a catchy jingle. Together with the Liril girl cavorting under a waterfall and Amul's plump little moppet, the Nirma girl remains one of the most enduring images from the television ads of the eighties. The ad catapulted a brand, which emerged from the backyard of a young chemist and promoter from Gujarat, Karsanbhai Patel, to dethrone Surf, the detergent heavyweight of the storied multinational that created the market in India - then HLL (now HUL or Hindustan Unilever).

Detergent till then was a premium product, with most households using laundry soap instead. But as vegetable oil price increased, synthetic detergents became the choice, popularised by HUL's road shows in villages. However, by the seventies, high petrochemical prices led to an increase in detergent prices. The time was ripe for a low-cost, no-frills alternative to Surf.

Patel's door-to-door campaign in 1969 with a detergent, encased in rudimentary packaging, was timed just right. By paring production, marketing and distribution (a single line of distributors who directly supplied the retailers) costs to the bone, he was able to sell Nirma at Rs 3 per kg. Through its heydays, Nirma was priced less than Surf by Rs 14 on an average.

As much as the cost factor, Nirma's earthy TV ads, made for it to go national, were quite different from the prevailing detergent TVCs and matched HUL's ad frequency. It showed a lively montage of young men and women singing and dancing, cutting across regions, cultures and income groups. Santosh Padhi, co-founder and chief creative officer of Taproot India, an agency that now handles the Nirma account, says, the three reasons the brand imagery succeeded were the catchy jingle, the characters of Hema, Rekha, Jaya and Sushma, quintessential housewives, and the mascot of the Nirma Girl.

"In Nirma ads, the detergent was positioned as peppy. The mundane activity of washing was shown in a playful way, while the other brands showed housewives washing clothes in the bathroom," says Padhi. Gujarat-based Purnima Advertising Agency was the agency that worked on the signature campaign. Taproot was signed on in 2009.

It says much for the feisty, home grown nature of the brand that the mascot was Patel's daughter and 'Nirma' partly derived from her name, Nirupama. "In those days, there used to be an emotional connect of the promoters with their brands," says an executive who has been associated with the brand for many years.

By 1985, Nirma had twirled its way to the top of the detergent chart, usurping Surf, according to reports. Surf was wary of dropping its price that would dilute its equity. Nirma forced HUL to go into a huddle to work around a long-held belief of how MNCs should not sell low-end products. HUL's Operation STING (Strategy to Inhibit Nirma's Growth) resulted in the launch of Wheel in 1988. Nirma reportedly had 60 per cent of the total market by then, selling over 1.72 lakh tonne.

For the next 12-15 years, Nirma continued with the same jingle, "Doodh si safedi Nirma se aaye, Rangeen kapda bhi khil khil jaye" [Nirma renders white clothes milky white and coloured ones brighter] and the montage ad. By then, Surf's Lalitaji was also being countered by Nirma Super's Deepikaji, two prudent housewives who vouched for the benefits of their respective brands.

Despite the might, HUL put behind Wheel to parry Nirma, Wheel could only scale to the top of the market (which had become mass brands-led) in the early 2000s. It struck a chord with Nirma users, who were reportedly smarting from burning hands, by positioning itself as a gentler product (priced almost at par with Nirma).

Eventually, both Nirma and Wheel (which got sidelined by HUL's 'power' brands strategy) were usurped by Ghadi in the mid to late-2000s. It was a challenger which was priced even lower than Nirma (began in 1987 but came into its own in 1995). While Wheel is back in the reckoning, Nirma failed to recover, losing out on premiumisation, and without any innovative variants. What it could do, Ghadi did better (including a grasp over rural markets) and Wheel had already moved to a better value proposition. When contacted, Nirma declined to comment on the story.

Although the Nirma girl was as endearing as Amul's moppet, Nirma Limited chose to reposition the brand. The transition also coincided with Karsanbhai's son, Hiren K Patel, taking charge. Taproot decided to build stories around the four original housewives by portraying them as today's women. Padhi says, "The roles of Hema-Rekha-Jaya-Sushma have changed. Four independent and strong women appeal across regions and classes. We also contemporised the melody, keeping the lyrics intact."

Harish Bijoor, CEO of Harish Bijoor Consults, a marketing consultancy, says, "While the brand is trying to position itself as a more urban offering, if it is to focus less on the Nirma Girl, that would be a loss. It could do some cosmetic changes to make it more relevant."

Sources, however, say that the Nirma girl won't be revived in its ads for emotional reasons. "Since the image of the girl is that of Karsanbhai's late daughter, who died in an accident, he is not keen on the mascot anymore," says the executive who requests anonymity.

Even as the Nirma girl stops twirling in its advertisements (she lives on in the pack design), the brand seems to merge into the sea of detergent brands (around 400) dotting grocery stores. It has a market share of around 10 per cent, according to market estimates - a far cry from the days when it scripted the perfect underdog win.

2. SWOT Analysis

Strengths

1. Strong brand equity developed over the years

2. Wide distribution network

3. Market leadership in detergent market (mid priced segment)

4. Highly successful initial advertising campaign

5. In 2004, Nirma’s detergent approached 800,000 tonnes – one of the largest volumes sold in the world – under a single brand

6. It has always practiced ‘value-for-money’ strategy targeting the huge Indian middle class market
7. Nirma has manufacturing facilities at 6 places in India

Weakness

1. Still struggling to make space in premium segment

2. Lack of global tie-ups and hence the export market

Opportunity

1. Acquisitions for strengthening its distribution tie-ups

2. Expanding market: By penetrating more in the rural markets through its project Shakti AMMA and transition of unorganized business to organized one will lead to further expansion of the consumer goods market.

3. Awareness in usage rate of as people are getting more aware and conscious about the usage through advertising, word of mouth, doctor's prescription etc. This is resulting in increase in usage rate of these products.

Threats

1. Expanding reach of both local & foreign brands

2. Guerilla attack from HUL and P&G

3. Growing income of Indians leading to a shift to premium segment washing powders

3. PEST Analysis

Political :

Economic :

Social :

Technological :

Technological factors affect marketing and the management thereof in the following ways. Let us compare the situation of Washing Powder Nirma with each of the suggestions

· New ways of producing goods and services

· New ways of communicating with target markets

Porter’s Five Forces Model

Very High

Very Low

Very High

Low

Literature Review

Detergent Industry in India

The detergent market in India is divided into three segments – premium, mid-range, and popular. The premium segment comprises Ariel and Surf; the mid-range segment comprises Tide, Henko, and Rin; and the popular segment - Mr White, Wheel, Nirma and Ghari. The market share of the detergents in the premium segment is 15%, and that of the mid-range and popular are 40% and 45% respectively.

The detergent market in India can also be classified into two major categories: hand-wash and the machine-wash categories. Powder detergents and bar detergents form a major portion of the hand-wash segment. In the machine-wash segment, powder detergents and liquid detergents are the main types. With the increasing penetration of washing machines and lower prices, laundry care consumers are shifting from bar detergents to powder detergents, a factor triggering growth for this category.

Research conducted by Ariel on the Indian laundry market indicates that ‘fragrance’ in detergents is an important factor of delight for the home-maker in her daily laundry chore.

Hand-washing remains the most prevalent mode of linen-wash in India, particularly in rural parts of the country, with these products accounting for a 74% share of laundry-care sales. Also Price is an extremely important factor for consumers in rural India. In this aspect, Nirma was a brand that was to reckon with.

Growth of Nirma

In 1990, Pranesh Shukla from Delhi Business school prepared a project report on Nirma Washing Powder. Her topic was “Marketing Research on Nirma and its Supply Chain Management”. In his study he found out how Nirma being much cheaper than Surf and other quality detergents, came as a boom for housewives who were struggling to balance their monthly budgets. Its cleansing power was far superior to that of the slabs of cheap washing soaps that had been their sole alternative until then. By the early 1980s the burgeoning sales of Nirma reached a rate of growth that was twice or thrice that of the industry in general. Moreover, Nirma operated in the small-scale sector and, therefore saved an enormous amount of excise duty that multinationals had to pay on every kilo of detergent produced. The latter simply could not hope to bring the price down to a level that was attractive enough for the middle and lower-middle classes, which were the bulk segments for Nirma sales. Price of Nirma Washing Powder 1kg pack was Rs 18.00 and price of Nirma Washing Powder 500grams pack was Rs 9.00. This pricing policy adopted by Nirma challenged the mighty HLL’s Surf and became its Unique Selling Proposition. Nirma pioneered the concept of flat distribution network. Nirma Consumer Care Limited operated with two parallel distribution networks. The Nirma brand was marketed through the first network, which consisted of about 450 exclusive distributors. It was one of the lowest cost FMCG distribution channels of the country. At that time Nirma sold over 800,000 tones of detergent products every year and commanded a 35% share of the Indian detergent market, making it one of the world’s biggest detergent brands. The brand promotion efforts were complemented by Nirma’s distribution reach and market penetration, through a country wide network of 400 distributors and over 2 million retail outlets, making Nirma products available from the smallest rural village to the largest metro. (Pranesh Shukla, 1990)

Downturn of Nirma

As per Dr. S.K.Laroiya research in 2004, Nirma's downturn is a combination of offensive and defensive strategies adopted by its rivals in the detergent segment of the industry. Having taken an initial beating, Hindustan Levers Ltd (HLL) reacted to the low-cost provider strategies of Nirma in many different ways. Besides its Project Millennium and continual efforts at restructuring, HLL had been alive to the market needs. HLL, despite being a bulky and bureaucratic corporate entity, has always been a practitioner of innovative techniques, especially in its strong area of rural marketing. HLL undertook several actions, and among these are the offensive strategies of price-cutting and defensive strategies of coming up with matching products with some differentiated elements such as in the case of ‘Wheel’ detergent.

As per the interview with Azhar Kazmi present in the research- “Too much of a good thing sometimes turns out to be bad: Nirma faced its troubles owing to its initial successes”. He took the case of Nirma’s legendary low cost leadership strategies. According to them they outlived their utility long back to the type of business environment that was emerging. Yet Nirma continued to insist on replicating its proven formula for success. The marketing environment was changing yet Nirma did not react fully to it and did not change its assumptions. The customer that relished buying Nirma in 1990 did not want to buy it in 2015. Therefore, there was a mismatch that occurred in what Nirma offered and what the customer really wanted. Obviously, the customer was now demanding enough to expect not only low price but better quality too - an area where Nirma, owing to its misdirected attitude to cost cutting, was not able to satisfy. (Dr. S.K.Laroiya, 2004).

Timeline Review of Nirma

Given below is the timeline review of the Nirma where we can get a look at the facts and figures of how Nirma rose from being any other brand to becoming one of the most trusted brands of the country. The timeline takes a walk through the journey of Nirma from 1969 till 2013.

Methodology Adopted

The methodology adopted for study and analysis of the consumers’ behaviour (for the chosen product) is Google Forms Online Survey. This method was selected, keeping in mind, the terms of buying roles, decision-making process and kind of purchase behaviour (keeping into consideration the competitive environment among the products).

The research design of the survey is a Non-Probabilistic Convenience Sampling, targeting the homemakers of our society.

An online survey is a simple, inexpensive way to collect circumstantial evidence and gather customer opinions and preferences. These online surveys can be used to update demographic information, collect opinions on new and existing products, get answers to open-ended questions, or to probe overall customer satisfaction. We can now add online surveys to the another way of conducting simple yet insightful market research survey, following the customer surveys which were conducted via telephone and mail for years by business owners.

The form is designed in such a way that it tries to incorporate different significant aspects of the detergent product category like the cost of the product, availability in the market, skin friendliness of the detergent and the overall likability. The survey also contained a question regarding the age group of the current user to bracket the segment of the population for the various trends and analysis. The same factors are compared for a total of five products in the survey – Nirma, wheel, Tide, Surf Excel, Ariel. These are the five major products that dominate the detergent market currently. The results of the survey are described and analysed in the following section.

Data Collection and Analyses Approach followed

The summary of the responses are presented with the analysis for each question of the survey. The factors considered were age group of the survey takers, costliness of the detergent, availability of the detergent in the market, skin friendliness & overall likability.

Age group of the survey takers

The split-up of the age factor indicates that the majority of the survey-takers fall in the category of 20-50 years bracket. Since this analysis pertains to a product like detergent, the survey was targeted at feminine audience who would know better about the detergents. Hence, this is the explanation for the majority of the survey takers falling in the age group of 20-50 years. This encompasses of people who actually go out to buy detergents and have an idea of the current detergent market scenario – mostly women of the house.

Cost of the detergent

For this question, the survey required the takers to rate the detergents on a scale of 1 to 5 with 1 being the cheapest and 5 being the costliest. From the responses garnered, we can see that Nirma has been voted by the people as the cheapest of the 5 detergents. This is then followed by Wheel, Tide, Surf Excel and Ariel.

From this result, we can understand that, being affordable is one of the main advantageous factors of Nirma which can be leveraged by the company in order to gain increased penetration in the detergent market.

Availability in the market

The question mentioned above was about the rating of the detergents for their availability on a scale of 1 to 5; 1 being not easily available and 5 being easily available. From the ratings obtained, we can see that availability of Nirma in the market is difficult. The ratings are as follows

Based on the results, we can analyse that Nirma needs to focus on supply chain and logistics in order to make sure that availability of Nirma detergents is high in the markets which will help increase the sales and in turn the profit.

Skin friendliness of the detergent

One of the concerns while choosing a detergent should be on how skin-friendly it is. Dyes and fragrances in detergent and laundry soaps contain chemical substances that clean, deodorize, and disinfect, and in an overly skin-sensitive person, even the slightest contact can trigger an allergic reaction. From the survey, we can see that people don’t prefer Nirma to wash their clothes in comparison to the other brands mentioned in the survey.

Nirma should come up with different variants of the detergents in terms of flavours in order to make sure that they lose out on the market-edge they gained with affordability factor of the detergent.

Overall Likability

The final factor is the overall likability of the product in comparison to the competing brands on a scale of 1 to 5; 1 being very likable and 5 being not at all likable. From the results, we can see that Nirma as a brand is very likable and scores very well. The rankings are as follows

Nirma as a brand is very likable and relatable to the customers. We can see this from the customers’ responses.

From the above survey we can come to a conclusion that Nirma as a brand value is very strong and people still have the respect for it. But it is now the onus of the brand to reinvent itself and maximize their customer base.