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PROJECT SHAKTI

VIEWS: 204 PAGES: 26

  • pg 1
									          Presented By :
              Devjani Seal
GROUP 4
          •
          •   Dipti Ranjan Naik
          •   Harshita Kumar
          •   Ipseeta Misra
          •   Jishnu Sasikumar
          •   Karthik Kumar Reddy
          •   Nakul.R.Pareek
          •   Namrata Jain
    Unilever was the worlds largest FMCG company
    with a global turn over of US $ 55 BILLION in 2004.

    Its product line includes detergents, personal
    products , beverages and foods.

    HLL ‘s growth in India was linked closely to
    political developments in the country.

   In 1990’s the Indian economy began to open up
      a) License Raj slowly disintegrated.
      b) Import restrictions also reduced.
   HLL faced competition on mainly two main factors

     1) LOWER PRICE SEGMENT : Large no of unorganized local players.

     2) HIGHER PRICE SEGMENT : Organized national brands like
    colgate- palmolive in oral –care category , procter and gamble in the
    hair care, face wash etc.

    NIRMA was another competitor entered into the market
    manufacturing low price detergent powder. Nirma grew rapidly
    eating into HLL shares in the laundry business.

   HLL responded to the competiion by creating new brands. In
    response to nirma they launched wheel in detergents and breeze in
    soaps.
                     HLL SALES ORGANISATION
COMPETATIVE ADVANTAGES FOR
               HLL                                  CHANNEL PARTNERS
( Then in terms of their products )


                                                        • MANUFACTURING UNIT
                 1. STRONG BRAND         FACTORY
                     PORTFOLIO


                 2. STRONG SUPPLY                       • CARRY AND FORWARD
                CHAIN MANAGEMENT          DEPOT
                                                          AGENT


               3. DISTRIBUTION AND
               SALES MANAGEMENT                         • WHOLESALERS &
                                      REDISTRIBUTIION     DEALERS
                                         STOCKIST
   WAS BASED ON GEOGRAPHIES AND PRODUCT
   NOT APPROPIATE FOR SMALL MARKETS
   POTENTIAL AND TOO SMALL
   NO INDIVIDUAL STOCKISTS
   DEVELOPMENTS IN URBAN MARKETS
   SELF SERVICE STORES
   COMPREHENSIVE ANNUAL CONTRACT
   ONE FRANCHISEE OF A NATIONAL RETAIL
    CHAIN
SALES BEING LOW

TURNOVER WAS AFFECTED
   • TOP END STRATEGY
 • THE MIDDLE END OR THE
    LARGEST END STRATEGY
• THE BOTTOM END STRATEGY
   DIRECT COVERAGE

   INDIRECT COVERAGE

   STREAMLINE
   Project Shakti was a rural marketing initiative of Hindustan Lever
    limited.

   35 people initially was part of it. About 12000 women entrepreneurs
    had been appointed. Covering nearly 50,000 villages and partnering
    with 300 NGO,s.

   Challenges by Sehgal : Shakti team has to reach 100 million
    consumers by 2006.

   Dhall,s motive was to make a business plan that would make shakti
    a viable and sustainable growth engine for HLL in the coming years.
   HLL’s New Venture Division
          1. Key source of growth

          2. Competitive advantage in future

   Greatest reach in rural India – 16 % Direct Reach.

   Barriers to Better Coverage
          1. Poor reach of Electronic Media

          2. Lower Literacy level

          3. Low Brand Consciousness



   Impediments to economic growth
        • Lack of funds & Shortage of investment
               Opportunities.
   NVD proposed HLL to Partner With SHG
          Bangladeshi Grameen bank Model.

   Project Shakti was born in December,2000
             Nalgonda District in Andhra pradesh.

   Business Objectives
           1) Reach Untapped Market

           2) Develop Brands through local influencers.



   Social Objective
           Provide Sustainable livelihood Opportunity to
            underprivileged rural women.

   Shakti : Strength / Empowerment.
             Symbolize the role women would play
              in HLL new enterprise.
   Initially HLL partnered with 3 federations of SHG’s
    known as MACTS.

   Business Model Was Modified : Shakti Enterpreneur
    Advantages:
        1) Responsibility
        2) Income generation gained significance.

   Sales to outlets & directly to customers.
    Advantages :
       1) Retail margin + HLL’s Discount
       2) Act as influencers impacting category &
          brand awareness.
   Women : Target Customers to Bulk of products.

   Underprivileged Women will value additional income
    more than affluent women.

   Greater access into homes of potential customers.

   Addressing women will have greater impact on entire
    household - Improve health, hygiene & education.

   Since most men are employed, they would not devote
    much time to the activity.
   Average monthly income of women who became
    entrepreneurs was less than Rs.1000/-

   Source of fund : Micro Credit : 0.75 to 2.0 % of Principal

   Minimum Income generation Rs.500/Month.

   Raised initial investment to Rs.10,000/- so that entrepreneur
    could achieve
                Sales of Rs.120,000 /Year
                Monthly income of Rs.700/ Month

    Offered Star sellers an additional 2% to offset selling
    expenses & 1 % cash discount to those who dint avail
    credit.
   Inexperienced women entrepreneurs

   Building faith upon the project

   High Prices

   Market Penetration
   Take help of opinion leaders in villages like the
    head of panchayat and word of mouth to build a
    goodwill for HLL products.

   Hold training programme within the local vicinity
    and in local language to instill entrepreneurial
    skills and confidence.

   Fund meals in school for children in order to build
    a good brand image.

   Focus more on deeper market penetration for
    products which sold more.
   Branded social communication program targeted at
    the rural community.

   Program that would spread awareness of health
    and hygiene practices in rural India.

   Covering the cluster of villages, organizing school-
    contact programs, SHG meetings and village get-
    togethers and other social means to make people
    understand the importance of community hygiene.
   It was initially experimented in some districts of
    A.P. and other two states.

   The Vani program was implemented on the
    grounds of Ogilvy Outreach.

   One of the programs was funded by a ‘brand’ while
    other was funded by shakti.

   It benefits the company as it is a cheaper way of
    advertising and promoting HLL.
   Project Shakti initiative to extend the benefits of
    information technology to rural India.

   Empowers the rural community by creating access
    to information.

   Residents of the region could walk in and register
    themselves and then they could access to the
    content like education, career, opportunities,
    agriculture, health, legal procedures, etc. free of
    cost.
   This program has the potential of bringing the
    internet to villages. It is beneficial to the company
    also as it is a communication channel in the area
    where other media failed to reach.

   HLL tied up with AP Online, and about 500 ishakti
    kiosks are now operating in the region.
SCALING UP:
 The cost incurred on human resources, constituting
the bulk of the overheads incurred on project shakti in
2004, almost 10%-15% of shakti revenues.

 Project shakti had 500 RSPs, who managed 12,000
entrepreneurs.

 Plan to double RSPs, in next two years.

 Same issues with vani and i-shakti.
Cont’d…
   This challenge was made complicated by the
  different challenges the team faced in various
  states.

   Operating in 12 states and close cooperation
  in five of them.

   A related issue that affected shakti was the
  scale of SHG movement in state.

   There were cultural issues as well to contend.

   Language.
Cont’d…
 Developing self confidence in women.

 The shakti entrepreneur offered personalized
service, door step delivery, an assurance of quality,
but not enough to induce customers to pay cash.

 Creating network and implementing ideas.

 Formal training program to equip the shakti
entrepreneurs with the skills and confidence.

 In a media-dark region where conventional
brand-building efforts were relatively ineffective.
CREATING IMPACT, CHANGING LIVES:

 Started out as a niche initiative.

 Growth in HLL ‘s sales had slowed down since the
mid 1990’s.

 For some years net profits had increased
significantly and in 2004, sales and profits both
declined.

 Project shakti offered a silver lining. In 2004, HLL
rural turnover had grown to over 15%.

 Should reach 250million additional consumers
through 100,000 entrepreneurs
THANK YOU

								
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