Advertising and Promotion Strategies for Hul - PowerPoint

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					4Ps in Rural Markets

         SESSION – III

XAVIER INSTITUTE OF MANAGEMENT,
          BHUBANESWAR
                            Product

 “ Anything that has a value in exchange”
 Product – price – place – promotion
 Challenges – Availability, affordability, acceptability
 & awareness
        Marketing Tools            Marketing Challenge
                Product                  Acceptability
                  Price                  Affordability

                  Place                   Availability

               Promotion                  Awareness


        Source: The Rural Marketing Book- Kashyap. P & Raut. S
Cont’d
          Appropriate Product Strategies

 Existing & New Products
 Product features – service quality – price &
    performance relationship
   Simplicity is key
   “ Sense & Simplicity” – Phillips Global Campaign
    Urban market successes could be rural market
    failures
    Appropriate new product development processes
                    Product Levels


        CORE BENEFIT




 BASIC PRODUCT




EXPECTED PRODUCT




AUGMENTED PRODUCT

                                     POTENTIAL PRODUCT
                                   Cont’d

Product Level       Characteristics     Example               Rural Vs Urban
Core Benefit        Fundamental         Entertainment         Same
                    benefit/ services
Basic Product       Benefit/service     Television Set        Same
                    into tangibles
Expected Product    Attributes &        Digital sound, flat   Appearance of
                    conditions buyers   screen                differences in
                    normally expect                           expectations
Augmented           Exceeding           Battery Operated      Pleasant surprise
Product             customer            TV                    for rural customer
                    expectations
Potential Product   Encompassing all    Jolly Startek TV      Uniquely rural
                    augmentations &                           value proposition
                    transformations
                     Product Development Stages

     Stage                                          Marketing Activities
  Idea Generation     •Searching for   new product ideas


   Idea Screening               most promising ideas and drop those with only limited potential. Study the
                      •Select the
                      needs and wants of potential buyers, the environment and competition.

  Concept Testing     •Describe orshow product concepts and their benefits to potential customers and
                      determine their responses. Identify and drop poor product concepts. Gather useful
                      information from product development and its marketing personnel.

 Business Analysis              product’s potential profitability and suitability for the market-place. Examine
                      •Assess the
                      the company’s research, development, and production capabilities. Ascertain the
                      requirements and availability of funds for development and commercialisation. Project
                      ROI.


Product Development   •Determine technical and  economic feasibility to produce the product. Convert the product
                      idea into a prototype. Develop and test various marketing mix elements.

  Test Marketing      •Conductmarket testing. Determine target customers’ Reactions. Measure its sales
                      performance. Identify Weaknesses in product or marketing mix.

 Commercialisation    •Make necessary cash outlay for production facilities. Produce and market the product in
                      the target market and effectively communicate its benefits.
                FMCG Consumption Trends

       Products             Urban( 1000 HH)           Rural ( 1000 HH)
      Toilet Soap                   998                        992
     Washing Cake                   980                        950
      Cooking Oil                   968                        952
    Hair Oil/ Cream                 897                        787
          Tea                       876                        758
      Toothpaste                    822                        449
    Washing Powder                  819                        576
     Electric Bulb                  723                        394
       Shampoo                      663                        352
        Biscuits                    579                        314
    Health Beverages                324                        67
Source: National Council for Applied Economic Research, 2002
         Consumption Ranking

 Rank           Rural Product      Urban Product         Rural HH
                                                        Consumption
                                                       grams / month


    1              Toilet Soap        Toilet Soap            268

    2           Washing Powder          Biscuits             950

    3            Packaged Tea      Washing Powder            268

    4               Biscuits         Packaged Tea            302

    5            Detergent Cake     Detergent Cake           893

Source: A.C Nielsen Retail Audit, MAT, July -2004 & ORG- MARG Retail
                        Consumer Panel, 2001
            Rural Durable Usage Trends

 NCAER has classified durables into three categories

 Group One( <Rs. 1000)

 Group Two( Rs.1000- 6000)

 Group Three( >6000)

 In group one the growth is as high as 75 percent

 Electrical goods show the highest urban- rural disparity, why ?

 Television( B & W) 195/1000HH in rural Vs 490/1000HH in
  urban
 Colour TVs 48/1000 HH in rural Vs 304/1000HH in urban
                    Packaging

 Associated with affordability - Convenience -

 Consumer recognition & product protection

 Packaging material, size, convenience and

 aesthetics

 Example: Chik Sampoo
        Corporate Responses to Fakes

 Look-alikes- Spell-alikes & Duplicates

 Prices range from MRP to 60 % of MRP

 Margins range from 60 % to 300 %

 Legal action – awareness programmes – New

 Package Development
Fakes: Some Examples
Cont’d
Pricing
                  Issues in Pricing

 Internal & external factors
 Selecting pricing methods
 Pricing adaptations
 Low price points – Simple packaging – utility around
  packaging material
 Highlighting value
        Price Adaptations ( Indicative)

 Product sharing services, Example: Tractors
 Product Bundle pricing, Example: HUL Operation
  Bharat
 Free gifts – may sometimes not work in rural areas
 Special event pricing- Hero Honda Rs. 500 campaign
Colgate- Cibaca
     Place- Rural Distribution Challenges

 Large number of small markets

 Dispersed population and trade

 Poor connectivity

 Low availability of suitable dealers

 Inadequate banking/ credit facilities

 Poor product display and visibility

 Poor communication of offers and schemes
        Levels of Distribution

Level               Partner                   Location

 1          Company Depot/ C & FA        National/ State level

 2             Distributor/ Van              District level
           Operator/ Super Stockist/
              Rural Distributor

 3           Sub Distributor/ retail     Tehsil HQ, towns and
           Stockist/ sub stockist/star       large villages
                      seller

 4                Wholesaler             Feeder towns, large
                                           villages, haats

 5                  Retailer                Villages, haats
      Distribution Adaption( Indicative)

 Hub and Spoke Model, Example: Coca Cola
 Use of Affinity groups, Example: Project Shakti
 Haat Activation, Example: Colgate
 Syndicated distribution, Example: Cavin Care &
  Amrutanjan
 Use of marketing co-operatives, Example: Warna
  Bazaar in Rural Areas
 Mobile traders, Example: FMCG companies
Promotion- Adaptations for Rural Markets


     Conventional           Non- Conventional             Personalised

      Television              Haat and Mela               Direct mailer

        Radio             Folk Media( puppet and   POS (demonstration, leaflet)
                               magic show)

        Press                   Video Van                Word of mouth

       Cinema                     Mandi                   Interpersonal
                                                         communication

Outdoor: Wall Painting,                                     Animator
      Hoarding
                             Melas & Haats

                Melas                                     Haat

1. 25,000 melas                        1. Periodic markets located in larger
2. Companies can concentrate on           villages(> 40,000)
   the top 100 melas                   2. 10 – 50 villages are serviced
3. Pushkar Mela in Rajasthan           3. Sunday markets are most popular
4. Organised by the state veterinary   4. Average number of outlets is 315 and
   department                             average daily sales is about Rs 2 lakhs
5. Product sales, promotion,           5. Traders participate in at least 4 haats
   demonstration and database          6. 81 percent of the visitors are repeat
   generation                             customers
6. Cultural activities and rural
   sports
                Types of Promotions

 Advertising

 Sales promotions – coupons, contests, demonstrations

 and sampling, Example: Tata Shaktee Haat Hungama

 Direct marketing, Example: Videocon

 Publicity, Example: Project Shakti and AP Online

 Using a direct selling through a sales force, Example:

 Swasthya Chetna for Lifebouy
                      Cont’d

 Push strategy – sales force and trade promotion

 Pull strategy – advertising and consumer

 promotion
Close of Session




  Thank You

				
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