PRESENTATION ON RURAL MARKETING

Presented By- Anu Singhai, Kunal Assudani, Anup Vijayan, Salil Shrivastav & Vijay Patel

INTRODUCTION• In 1983 with a single product, CavinKare started out as a small

partnership firm Chik India by Mr. C.K.Ranganathan.

• Chik India, which was renamed as Beauty Cosmetics in 1990.

• In 1998 the Company was renamed as CavinKare Pvt. Ltd (CKPL).

• Chik shampoo with a 21.4 per cent share is the second largest selling shampoo in the Rs. 1,200-crore shampoo market

• Chik covers 50% of the cavin kare market

CONT’D

• CavinKare believes that its core competencies are research and development, brand building, and distribution management.

• The company offers quality Personal care (hair care, skin care, home care) and Food products.

• CavinKare Group has crossed a turnover of 8819 million INR in 2009-2010.

• The Company has employee strength of 1520, an all India network of 1300 Stockists catering to about 25 lakh outlets nationally

OPPURTUNITY TO ENTER RURAL MARKET

• Large untapped market.

• Increasing per capita income.

• Socio-economic changes (lifestyle, habits and tastes, economic status).

• Literacy level (25% before independence – more than 65% in 2001).

• Infrastructure facilities (roads, electricity, media).

• Increase in income Increase in expectations

COMMON CHALLENGES IN RURAL MARKET

1. Underdeveloped People

2. Lack of Proper Physical Communication Facilities

3. Many Languages and Dialects

4. Low Per Capita Income

5. Low Levels of Literacy

6. Prevalence of spurious brands and seasonal demand

7. Different way of thinking:

CHALLENGES IN RURAL SHAMPOO MARKET• Low penetration level of shampoo in rural market.

• The perception that shampoo contain harsh chemicals that could damage hair.

• The view that the shampoo is more of a glamour product rather than a hygiene product.

• Poor connectivity.

Shampoo Awareness in India:

• Shampoo Awareness in India Urban areas - 90 %, accounting for 80 % of shampoo sold in the country

• Rural areas - 80 %, accounting for 20 % of shampoo sold in the country

source : Calvin Kare 2007)

BIRTH OF CHIK

• This idea came in the mind of Mr. Ranganathan’s father when Epsom salt came in 100 gm packets.

• They wanted that coolies and the rickshaw pullers to use products.

• But due to the lack of marketing strategies they could not market the concept well.

• It renamed as Chik Shampoo after the death of father.

NEED GAP ANALYSIS

High

Low Poor Good

QUALITY

PRICE

LOCAL PLAYERS

MNC BRAND SHAMPOO

NEED GAP

PRODUCT

• CavinKare- pioneering attempt to offer shampoos in small pillow packs.

Strawberry extracts for soft hairGreen Apple extracts for tangle-free hairPapaya extracts for bouncy hair

Chik BlackChik Jasmine

Overall Shampoo Market Share• HUL's 50% (Clinic Plus, Sunsilk, Clinic All Clear, Others Lux and Ayush).

• Cavinkare 19% (Chik and Nyle).

• P&G 15% (Pantene, Rejoice, Head and Shoulders).

• Others 16%.

PRICE

TARGET AUDIENCES

• Lower Middle Class• Semi Rural (SEC B2, C, D)• Monthly House hold Income: Rs. 1500 – Rs.

3000• Age Group: 16+ yrs• Girls and women of rural and semi urban

population of India.

source : Calvin Kare 2006

PLACE • Chik’s objective was to expand the market, and get new consumers in

the category.

• Focus- largely rural, value-conscious sections in urban areas were also attracted.

• Instead of using conventional distribution route they have created a sachet sales force that sales only sachet packets to small retailer including cigarette and pan shops.

• Distribution in rural areas is driven through innovative trade schemes & consumer offerings

DISTRIBUTION STRATEGY

• There main focus is product reach.

• Separate hawkers' channel is created that moves from neighborhood to neighborhood.

• The hawker channels exist in all cities where they have a distribution network.

• They are moving fast towards post offices as well.

• They are placing products at post offices, products such as shikakai powder, shampoo and hair dye.

PROMOTION• Ad strategy based on the powerful appeal of cinema among

common masses.

• Innovative radio ads based on popular cinema dialogues, unlike plain radio jingles of competitors.

• they educated the people on how to use it through live ‘touch and feel’ demonstrations and also distributed free sachets at fairs.

CONTD…….

• Also encouraged trial through a consumer scheme, where anyone could take any 4 empty shampoo sachets to a retailer and take home a Chik sachet free. Though more risky, this scheme paid off and more and more people began asking for Chik at their local retail outlet.

• They started giving 1 free Chik Shampoo sachet in lieu of 5 Chik Shampoo sachets only. Soon, consumers started asking for Chik sachets only.

RETAILER PROMOTION

• Apart from the service charges Cavinkare also gave retailers a Chik Sachet free for every 15

• empty sachets they get from the consumer.• They give special gift if dealer sale more

products in a particular season.• They also give discount on bulk purchasing.

CURRENT STATUS

• In the last 2 – 3 yrs the market share has come down though it is growing.

• It is mainly due to the anti dandruff shampoos in the market which from 0% has taken over 25% of the market.

• CavinKare doesn’t have an anti dandruff shampoo yet.• Ordinary shampoos constitute only 75% of the market of which

Chik holds 20% market share.

• Chik is the largest brand in rural UP, AP, etc. and the number one in many other states as well