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Iboitor of :Pjulogopin> MARKETING STRATEGIES FOR PROMOTING SELECTED INDIAN HERBAL TOILETRIES VIS-A-VIS FOREIGN BRANDS ABSTRACT THESIS SUBMITTED FOR THE AWARD OF THE DEGREE OF iBoitor of :Pjulogopin> IN Agricultural Economics & Business Management BY MUZAFFAR JAMAL UNDER THE SUPERVISION OF Prof. Shamim Ahmad DEPARTMENT OF AGRICULTURAL ECONOMICS & BUSINESS MANAGEMENT AUGARH MUSLIM UNIVERSITY ALIGARH (INDIA) 2003 The cosmetics and toiletries industry has grown tremendously in the past decade. There are more and more companies, both international and domestic, joining the foray. Giving fight to these goliaths (MNCs) are some home-grown companies. This is especially true in case of Cosmetics and Toiletries Industry, where .setting 'herbal' is the name of the game today. It feeds mainly on the traditional science of 'Ayurveda'. The Indian consumer is fast realising the benefits of this ancient science and Indian companies are cashing on the sentiments to leverage the opportunity and escape foreign competition. Thus market today is flooded with innumerable product variants, which boast of their herbal formulations. These not only compete with the 'chemical' products, but are giving them run for their money. It calls for a need to observe the volatile market scenario and changing consumer perceptions about these. This study attempts to make suggestions, so as to comprehend the great Indian Market in the present context. The study specifically aims to investigate the following phenomena: 1. The present and potential market of each of the selected products in the industry. 2. The usage pattern and buying behaviour of the consumers. 3. The usage purpose and product attributes preferred by the consumers. 4. Brand consciousness and brand loyalty in each product category. 5. To gauge the herbal preference in each of the selected category. 6. The effectiveness of existing promotional efforts. 7. Information source of the consumers for these products and assess the level of credibility given to these. 8. To assess the price perception and the price sensitivity of the consumers. 9. To estimate the problem of irregular supply and non-availability of the brands. 10. Frequency of schemes and the margin given to dealers for selected brands in each product category. Being a social research, it tries to identify the complex human behavior and the set patterns in it. The approach of the study is exploratory in the sense that it is mostly directed towards identifying the various characteristics of the market and to create observations conducive to further study. In spite of keeping the study wide enough and exploratory in nature, an attempt has been made to relate each aspect of the study with a managerial decision based on it. Lack of information on various consumer groups, their tastes and preferences, their changing perceptions has been the major reason for preferring an empirical study. An extensive survey in the six North Indian cities has been conducted taking sufficient respondents from cross sections of the consumers and the dealers. It was expected that the results may necessitate the changes in the presently held opinions and help in building a new theory altogether. A sample size of 550 was taken for the study. A stratified two stage sampling design has been used. Six cities were selected (two each from Class A, B & C) which give ample representation of the whole North India. For the purpose of 1 drawing conclusions from the crude data, analysis (direct & cross) was done and for testing of hypotheses, the Chi Square test has been used. Market shares of top three brands in each product category are as follows: Soaps S.No. Herbal % Non Herbal % 1 Pears 70 28.2 Lux 203 64.2 2 Dove 34 13.7 Savlon/Dettol 40 12.7 3 Cinthol 32 12.9 Lifebuoy 36 11.4 Creams S.No. Herbal % Non Herbal % 1 Ayur 31 66.0 Ponds 137 36.0 2 Fair Glow 6 12.8 Fair&Lovely 83 21.8 3 Ayurvedic C. 4 8.5 Lakme 76 19.9 Hair Oils S.No. Herbal % Non Herbal 0/o/ 1 Dabur Amla 77 44.8 Hair&Care 71 43.3 2 Vatika 50 29.1 Clinic Plus 42 25.o 3 Bajaj Almond 27 15.7 Keo Karpin 41 25.0 Shampoos S.No. Herbal % Non Herbal % 1 Ayur 52 55.3 Clinic 95 28.4 2 Vatika 22 23.4 Sunsilk 91 27.2 3 Nyle 17 18.1 Pantene 45 13.4 Tooth Pastes S.No. Herbal % Non Herbal % 1 Babool 29 42.6 Colgate 162 40.4 2 Miswak 14 20.6 Pepsodent 134 33.4 3 Colgate Herb 13 19.1 Close Up 91 22.7 Soaps: There is lesser product penetration in C-class city of Sambhal and lower income group. This holds a message for the marketers. It is towards these semi- urban cities that they can target their efforts to increase sales. Urban markets are getting almost saturated in soaps category, the C class cities and the likes i.e. semi-urban and rural areas hold potential for further growth. Creams: It is the middle income group of 4000-8000 and 8001-12000 that reports greatest regular usage of creams (64.7% and 53.6% respectively) than the upper (40.6%) and lower (44.4%) income groups. This clearly shows greater focus of middle class on skin care. This middle class is getting more fashion conscious and has greater spending power after the advent of liberalization. Especially the fairness cream market is the fastest growing in India. Hair Oils: Most of the users in all the cities are regular and casual users. This clearly reflects the mixed usage pattern, irrespective of the kind of city. Same is the case with people of different income groups. Marketers can target problem zo. specific hair-oils and increase sales by advertising it to relevant user groups in each kind of demographic area. Shampoos: This category shows more or less a similar level of product penetration with most of the cities having regular usage of above 50%. The only acception is the C-class city of Sambhal. This shows that while some of the semi- rural areas have caught up with the urbanized counterparts, but some still lag behind. These cities can be used by the companies to increase their sales by converting rare and casual users into regular users. Shampoos have made deep inroads into every city; it is only the usage that that is to be increased in the consumers. Thus marketers can induce campaigns to this effect, so as to increase sales. Tooth Pastes: B and C class cities shows 100 percent regular usage of tooth- pastes. It is in the C-class cities of Amroha and Sambhal that we find 8.2% and 4.8% casual users respectively. Overall percentage of regular users in the cities denotes that the only way to increase the sale is by inducing more product usage. Companies can promote use of toothpaste twice (morning and night) or even thrice (morning and after each meal) a day. Top three usage purpose of each product category are given below: Soaps Creams Hair-oils Shampoos Tooth-pastes Cleanliness Sun Protection Nourishment Cleanliness Cleanliness Freshness Moisturiser Anti Dandruff Anti Dandruff Gum Protection Anti Bacterial Glowing Skin Shiny Looks Good Looks Cavity Prevention For soaps we can safely infer that the three usage of cleanliness, freshness and anti-bacterial are the most sought after by all consumers, with variations in priority order across different income groups. Thus marketers should concentrate around these to add these benefits to the product and then effectively promote around it. Marketers must direct the creams to different class of people highlighting these different qualities and pricing the product accordingly. A different promotion and advertising needs to be done to tap different groups effectively. For hair oils marketers need to assess the market for each hair-oil type and accordingly introduce products suiting the particular need of the consumer. This study is helpful for them to determine its product type and position it in the market. They need to differentiate their product accordingly and based on the preferences of each income group needs to tailor make their products. Manufacturers need to formulate problem specific shampoos to cater to various segments usage wise. They can target lower income groups for increased usage of shampoos and induce its regular usage to increase sales. Marketers can include the given three properties in the tooth-pastes and accordingly advertise them to target these groups differently. Also the survey shows that the use of tooth-pastes is less in low income groups in comparison to higher ones. Thus these low-end people can be targeted to adopt and increase product usage to increase sales. 3 Respondents show a bend towards the herbal remedies and confirm their faith in these. Marketers can convert this into an opportunity by continuously making innovations by combining the 'Tradition' with 'Science'. This shows the increasing consciousness among men of their skin and hair care. Herbal is the thing in place among all cities, all income and age groups and both the sexes. Thus marketers need to convert this opportunity into big profits, by giving consumers the herbal benefits with ease of science. The herbal trend is picking up in all the cities. An interesting thing to be noted here is that this trend is at the early stage of its development. This leaves marketers with a lot of space to further spruce up the things and make them work to their advantage by offering new scientific based herbal formulations. Trends are similar among all age and income groups. According to the dealers this trend is more in the C class cities, followed by A class cities and then B class cities.
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