The main objective of this project is to achieve a thorough understanding of the various concepts of marketing which we have been familiarised with, through the curriculum. This has been brought about by correlating theory to practice and we have selected Mysore Sandal (Toilet Soap) as our product, for the same.
Through this marketing project, we have tried to understand the activities of KSDL (Karnataka Soaps & Detergents Limited) in a holistic manner and also specifically pertaining to marketing, analyse its product Mysore Sandal in particular. KSDL is one the premier soap manufacturers in the world. The situation analysis talks about the soap industry on the whole, analyses KSDL as a firm. It was found that KSDL has the second highest market share in the industry and targets a niche segment. The competitor analysis talks about the various competitors of KSDL.It also analyses the strengths and weaknesses of its competitors. SWOT analysis deals with the Strengths, Weaknesses, Opportunities and Threats in respect to KSDL and the Soap Industry.
Here, it must be noted that the Opportunities and Threats are for the Soap industry on the whole. Under utilization of capacity, high debts and almost obsolete plant and machinery seem to be the major weaknesses whereas product differentiation, raw material availability, distribution channels and brand image seem to be its major strengths.The segmentation talks about demographic, psychographic and geographic segmentations with regards to KSDL with relevance to our product( Mysore Sandal). It has been observed that the company targets a niche consumer segment for this product. Under the Marketing mix we discuss about the various aspects of its pricing strategies, the different variants offered in this product line, channels of distribution and the promotion strategies that are adopted. To conclude, we have provided suggestions and strategies that KSDL can adopt over the next one year in order to strengthen its presence in the market and promote its sales.Some major recommendations include reaching out to rural areas(now upper middle class and high income groups are being targeted),changes in pricing policy to facilitate the previous point , aggressively promote its lesser known products like incense sticks, baby soap etc.
Introduction India is a vast country with a population of 1,030 million people. Household penetration of soaps is 98%. People belonging to different income levels, different age groups, and different gender use different brands, which fall under different segments, but everybody at all the levels use soaps, making it the second largest category in India.Rural consumers in India constitute 70% of the population. Rural demand is growing as the awareness to health and sanitation, and with more soap brands being launched also in the discount segment targeting the lower socio-economic strata of consumers. Source??? Mysore Sandal built up its brand image by emphasizing Indian legacy, cultural heritage, using different brand building tools. Mysore Sandal Soap acquired the reputation of the only soap brand in the world that uses 100% Sandalwood oil.
KSDL, the manufacturer of Mysore Sandal brand chose an emblem “Sharabha” which has a mythological significance.Mysore Sandal brand was built using advertising, sales promotion and celebrity endorsements. Objectives * To understand the current scenario of the industry and its growth prospects. * To analyze the firm (KSDL) and its marketing agenda pertaining to our product (Mysore Sandal) * To come up with the plan for the next one year which the firm may adopt to incresase sales and market share. Situation Analysis Industry Analysis: Toilet soap industry in India has variety of consumers, diversified in the spects of buying capacity and geography, which leads to high degree of fragmentation and hence gives rise to extensive competition among the players. We have both national and global players dominating the market while the small players have limited themselves to mostly regional reach. Some of the large players in the market are HUL, P&G, Wipro, Godrej and KSDL providing a wide range of products line to the consumers, of which some of the most common and popular brands are LUX, Cinthol, Rexona, Mysore Sandal soaps, lifeboy, Dettol and many more.
Soap manufacture has 2 classifications, organized and unorganized sectors. KSDL, HUL are the examples of organized sector and the unorganized sector is dominated by local players like Areena, Ubtan, Song of India, Paker Neem are few prominent ones. The market is divided into four segments on the basis of price: premium, popular, discount and economy soaps. Premium soaps are estimated to have a market volume of about 80,000 tonnes. This translates into a share of about 14 to 15%. In India, soaps are available in five million retail stores, out of which, 3. 75 million retail stores are in the rural areas.
Therefore, availability of these products is not an issue. 70% of India’s population resides in the rural areas; hence around 50% of the soaps are sold in the rural markets. The industry and the demand for the soaps have been ever growing and currently it is at 7%. This increase in demand can be attributed due to growth of population, income ;amp; consumption increase, increase in urbanization and growth in degree of personal hygiene. Challenges faced by the Soap Industry: Soap industry’s major concern is with that of raw materials. The major ingredients are soap ash, linear alkyl, benzene;amp; sodium.Tripoli phosphate poses number of serious problems in terms of availability.
The demand supply gap for vegetable oil is 1. 5 to 2 lakh tons ;amp; is met through imports. In recent times, caustic soda and soap ashes in the cheaper varieties of soaps are quite high. As the cost is increasing on one side, the competition is forcing to keep the prices low. Competitor Analysis The soap market is highly competitive with the presence of local, national and global players. The majority of the market is being held in stake by HUL which has about 70% of the total market of which more than 60% of it comes rom rural. The other important players are Godrej at 4%, P;amp;G at 10% and KSDL at 11%.
For our competitor analysis we shall consider the market leader HUL and its strengths that makes it the leader in the field. How come godrej is given more credit compared to P;amp;G, I need the source, is it true that P;amp;G lags behind KSDL Hindustan UniLever: Hindustan UniLever is the largest contributor to the toilet soaps market of India. It enjoys almost a two-thirds share. Some of the big brands of HUL are Lifebuoy, the largest selling soap in India, Lux, Liril , Pears, Hamam, Rexona, Breeze, Dove, and Savlon.Some of the significant Strengths of HUL that allows it to be the Market leader are: * Local Subsidiary of Unilever, world’s largest manufacturer of Consumer Goods. * Cutting edge distribution network in place, which ensures that the products reach across the length and breadth of this vast country. * Maintaining favorable trade relations, providing innovative incentives to retailers and organizing demand generation activities among a host of other things.
* Nationwide manufacturing facilities * State-of-the-art research facility * Product and process innovations * Strong Brand equity * Constant Marketing InitiativesYou are supposed to discuss minimum 2 competitors and list down their weaknesses as well Company Analysis Karnataka Soaps and Detergent limited (KSDL) is one of the oldest and successfully running state owned soap manufacturers. The objective of providing the rich experience of soap perfume with a blend of sandal oil was achieved in 1918 November. In 1980 the Karnataka Soaps and Detergents Limited was renamed and got public listed. Today the company is into manufacturing a wide variety of products ranging from toilet soaps, detergents, Agarbathis and talcum powder with a rich tradition for quality of its products. OBJECTIVES OF KSDL: To serve the National economy. * To attain self-reliance. * To promote purity ;amp; quality products * To maintain the Brand loyalty of its customers.
* To build upon the reputation of Mysore sandal soap based on pure sandal oil. KSDL is trying its level best to ensure healthy ;amp; cordial relation with trade unions in all matters regarding industrial disputes ;amp; employee satisfaction. HRD acts as a mother as it ensures people are treated perfectly well ;amp; widening the scope of the employees. SWOT ANALYSIS STRENGTHS: * The factory is located in the heart of the city ;amp; has all infrastructure facilities.They require quick movement of raw materials ;amp; finished products. Due to its proximity, habitation movement of men and material are easy. Justification is too complicted * The company has modern manufacturing facility with maximum capacity, brand loyalty of consumers and has 90% of sandal soap market, foreign technology to suit indigenous condition due to government participation, little financial crisis with backup from government.
* A very good dealership network, which ensures that the products reach every loop and corner. * An ISO 9002 certified company has its own brand image.An ISO 14001 company, which commits to reserve the natural environment in the production of its quality products to the satisfaction of its customers. * Diversified product range keeps the company stable. * Abundant availability of raw materials. how is this a strength???? WEAKNESS: * Slow growth rate 6. 2 growths over 40 years against the product of 80%.
not clear???? * Power intensive: dependent on power may miscarriage here results in under utilization of capacity not clear * Defective marketing strategy lacks effective advertising and publicity. justify * Needs updating with times in terms of plant and machinery.Doesn’t look like a weakness * The large proportion of the target area is upper middle class and upper class people. so what, how is it a weakness??? * Due to lack of direct sales, debts with many dealers turning bad. * Unskilled labour coupled with excess labour hampers profitability. Entire weakness needs to be improved OPPORTUNITIES: * The toilet soap and the detergents market is an over expanding industry and a major company likes KSDL with its manufacturing expertise can call the shots if it reaches peak manufacturing capacity. Does not make sense * Good export market should tap foreign market vigorously.
What is the growth of export * At present it has Good raw material sources to enhance production. THREATS: * Competition from other global leaders like HUL, P;amp;G. * Government interference may reduce growth potential. How??? * As the company depends on forests for its main raw materials makes the company to find chemical alternative to sandalwood. Lacks clarity * To protect the financial interest of the company. Wring, does not make sense SWOT is poorly discussed in the report Market Segmentation Basis of Market Segmentation KSDL believes that the quality of the product determines the volume of sales and hence the bottom line.Out of the four types of micromarketing, KSDL follows NICHE MARKETING in the case of Mysore Sandal products.
A niche is a narrowly defined customer group seeking a distinctive mix of benefits. Marketers usually identify niches by dividing a segment into sub-segments. The bases of segmenting markets are demography, geography, psychograph, behavior. TARGETING AND POSITIONING Mysore Sandal with several variants and high depth in its toilet soap product line caters to niches in various segments based on the above mentioned criteria. Demographic: In this type of classification, segments are divided on the categories of ge, family size, gender, income, occupation and education. Mysore Sandal’s GOLD soap which was introduced in 1998 catered to the younger generation. It was a premium quality product and was developed after 2 years of research and development.
So it targeted the urban youth which was a niche segment. It also released its Baby Powder and Baby Soap, targeting the infants and young mothers. In a unique marketing move, KSDL went in for creating a new super premium segment in the highly cluttered soap market. Mysore Sandal Platinum priced at Rs 200, aimed at the niche high income group which expected supreme quality.They also targeted the low income group with their product WAVE. Geographic: In this type of classification, segments are divided on the categories of regions, types of cities (Class 1 cities, Class 2 cities, metro cities etc. ), rural and semi-urban areas.
The new launches of different Mysore sandal soaps in 1998 and 2007 aimed at serving overseas markets and certain select cities in the domestic market. Mysore Sandal with its heritage and quality expected to create a good market in the west. The company came up with a new formulation exclusively for the US market.Mysore Sandal Classic was enriched with moisturisers and conditioners to meet the needs of consumers in countries facing severe winter. Psychographic: In this category, Mysore Sandal caters to the culture oriented and sophisticated urban population with its numerous variants. Product The Sandal soaps of KSDL are unique in their nature, with pure natural sandalwood oil. This is one of the most important reasons why it has a high demand for its products both in domestic and international markets.
KSDL today is one of the largest producers of Sandalwood oil and Sandal soap in the world.The Soap plant has one of the largest production facilities in the country with an installed capacity of 26,000 tonnes per annum. At what level are they reaching out to the customers Product Mix width: The product line of KSDL includes a wide variety of products including Toilet Soaps, Incense Sticks, Talcum Powders, Detergents, Sandalwood Oil and Liquid Soap. KSDL has Product Width of six (number of product lines) and long product length of twenty three (total number of products under all the product line). The Product Depth is also pretty deep for the product lines where it covers different features, different sizes and quantities.In the soap category we find about ten different varieties and in each we can find different packet sizes, quantities and packages up to six numbers at different prices. Product Consistency: The products in the product line are closely related as they are similar with respect to manufacturing as the ingredients used are pretty much same the – most important of them being the sandalwood oil.
Under the Toilet soap section the company provides large variations to cater the different needs of the consumers. Mysore Sandal soap – The most important product of the company. It generates more than 80% of the company’s revenue.It banks on the perfumery material of sandalwood as its main product. It has a brand value of royalty and richness and targeted to the upper and upper-middle class consumers. Its major competitor in this category is Lux, Dove, Pears etc that are of the high end products. Mysore Sandal Soap is available in sizes of 17gms, 75gms, 125gms, 150gms and 150gms x 3 packed in a set, mainly to satisfy the countries diversified buying desires.
Mysore Sandal Soap is also available in the packages of three soaps and also gift box so as to take care of the bulk and occasional buying demand of the market.Mysore Sandal soap is also available in different shapes with clear differentiation to the customers. The oval shaped soap is priced lesser when compared to the round shaped which is majorly intended to address the niche category. Mysore Sandal Classic and Mysore sandal Gold are the two variants which is meant for the niche category and is definitely placed at a very high price compared to its counterparts. Mysore sandal Gold is placed at 200 Rs per soap, costliest in the country. To create variation in the products Mysore sandal also came up with different flavours of which the prominent ones are Mysore Rose Soap and Mysore Jasmine Flavour.Filling the gap in the herbal section was achieved by the Herbal soap, carbolic soap and Turmeric soap.
And finally as a competition to J;amp;J, Mysore Sandal also launched baby soap and baby oil. These products provide the filling of the gap in the product line for the company. | Incense Sticks: There is a strong base and market for the company in these product ranges. Some of the variants in this line are Mysore sandal premium, Mysore sandal regular, Mysore Rose and Mysore Jasmine. Talcum Powder, Detergents, Sandalwood Oil, Liquid Soap are the other product lines where the company has been able to make significant presence.Product Diversification: this is line extension and not diversification KSDL has gone in for creating a new super premium segment in the highly cluttered soap market. The company is launching the most expensive soap in the Indian market, Mysore Sandal Platinum.
Along with Platinum, the brand is moving to mass market (down-market stretch) with a non sandal soap branded Wave (at Rs. 13). Both these initiatives can be cited as an example of Two Way stretch of a product line. KSDL is currently diversifying its product range.It is planning to offer a few more personal healthcare products after introducing its branded ayurvedic toilet soap Herbal Care in Tamil Nadu. The company proposes to introduce liquid soap variants and its own shampoo products and is developing the products, which may hit the market soon. Product Life Cycle what si this cycle-recycle pattern, think you need to discuss PRODUCT and not BRAND life cycle, Mysore Sandal is a brand and not a product Mysore Sandal Soap appears to be following the Cycle – Recycle pattern and currently is in the growth stage.
The product was introduced in 1930 and is still going strong. The reason it is considered to be following the Cycle- recycle pattern is because though it was the market leader prior the independence it lost its market after the 1990’s due to the entrance of the new players. Now it is trying to gain back its market share by launching new products, diverging into different product lines, aggressively marketing and increasing its distribution channel. Price The Products are priced in accordance to domestic and international market.Every product is assigned with different pricing strategy depending upon the nature of the product, stage in PLC, Demand, Reference prices and the features it provides to the consumer. The Mysore sandal soap follows the Product- Quality Leadership strategy of pricing, providing the affordable luxuries – characteristics of high level perceived quality, taste and status with the price just enough to be out for consumer’s reach. The other reason for pricing at this range is to maintain the Going rate pricing, to give a competition to its close competitor LUX.
The Mysore sandal platinum soap is set to be the costliest soap cost about 200 Rs per soap. Here it is purely a Perceived Value pricing strategy which allows it to be placed in the niche category. The high price makes it unique and luxury so that it can be affordable only by the upper class. Also the perceived brand image of Mysore Sandal soaps which is usually associated with the royal highness of Mysore allows it to do so. The other variants like Mysore Herbal care, Jasmine Soap and the Rose soap are initially to follow the survival strategy and later the Maximum Market share pricing strategy.The major challenge faced by this product is to sustain the heavy competition by its peers and create a market especially in the rural segment for itself. These products are placed at a low price with minimum contribution as currently the company in not looking at making profits using these products.
Pricing is discussed in a shallow manner Promotion: Mysore Sandal Soap is facing a drawback of poor advertising and sales promotion. The company spends comparatively lesser money on advertising than other soap companies.Sales promotion activities are carried out through print media and television and activities like discount offers and concessions are not entertained much by the company. They spend more money on its packaging which is done in a traditional way without carrying any pictures of brand ambassadors. The brand typically faces the problem that all heritage brands face, that is to stay relevant to the new generation. Mysore Sandal is facing the issue that its loyal users are getting older and the new generations are moving to more visible brands. The brand is primarily seen a south Indian brand.
006 saw a very surprising move from KSDL. It roped in an unusual brand ambassador MS Dhoni to endorse the soap. The purpose was to get a foothold in the north as far as sales are concerned and to make the brand attractive to the new generation. Due to some legal issues, the contract with Dhoni was cancelled. Their recent brand ambassador for the Mysore Sandal Gold Soap was MughdaGodse. Distribution: KSDL manufactures their products i. e.
soaps ;amp; detergents. These are then sent to various distribution points through agents. The redistribution stockiest distribute it to the wholesalers.The wholesalers sell these products to various retailers in rural and urban areas and hence the product reaches its end consumers. Distribution Channel for KSDL Recently, KSDL has entered in to a strategic tie-up with M/s. Bharat Petroleum Corporation Ltd. and Indian Oil Corporation Ltd.
so that its products are made available in all BPCL LPG Dealers outlets and their In ;amp; Out outlets as well as in LPG Dealers outlets of IOCL and retail outlets of IOCL. By this tie-up, now the company has access to 25 million homes for their requirement of Toilet Soaps, Detergents, Incense sticks and Cosmetics.According to them, this is a milestone agreement entered with BPCL ;amp; IOCL to reach their products directly to the end consumers. It has entered new markets overseas such as the US, UK, Europe, Brazil and Africa with sales, predominantly from Mysore Sandal soap, touching Rs. 5 crore in 2007-08 — a growth of about 20 per cent over the previous year. It has appointed dealers in these markets and plans to increase its distribution network to cover about 20 large retailers by end of this year.Traditionally Middle East has been the company’s main overseas market with merchants directly buying the Mysore Sandal soap from India and selling it there.
Customer Service: The company offers its products in a variety of specifications, such as fragrances, characteristics and properties to satisfy its most demanding clients the world across. The group is committed to provide superior quality products and excellent customer service to offer maximum satisfaction to its clients. * Online purchasing by requesting a quote * Detailed Product Profiles * Online Query form for customers Customer Feedback/Complaint Register Plans for next 1 year The long term goal for the company would be to change its organization structure on whole and evolve out of the public sector way of functioning. The brand image of the company has to be changed from the License raj era to a much effective, responsible, performing and modern Organization. Product First recommendation would be to improve the performance and reduce to operational cost so that it increases the bottom line. Increase the investment into R&D so as to focus on new innovations in its products and process.A better suggestion would be to tie up with some International R&D setup to learn new technology.
How will you do that Throughout our Suggestions there is one thing that we would be repeatedly emphasizing, that is to rebuild the Royal Image of the Mysore Sandal Soap. This soap had an image of being used by the royals and highness – represented the culture and heritage of the country, which has to be brought back so that it creates the brand image. The only strong feature of the product Mysore sandal soap is the Sandal attribute. We re-emphasis the same, strongly, by finding alternate ways of reaching it to the customer.Example: sandal feature of Mysore sandal soap can be portrayed as an element that would help the skin to with stand against pollution or can be shown as a cooling agent that would nullify the effect of increasing global warming. Repacking of products The Packaging of the product appears very obsolete and absolutely in no position to contend with its competitors. More colors have to be added to the cover and new shapes to be designed so that it has a better appeal to the customers.
We could also design the soap in the form a pearl and provide a soap box in the form of king’s crown (of course freely) to hold the same.Why free, why not charge… Repositioning The toughest of all the above would be to position the product. First of all we maintain the royal image and also need to reach the middle and lower middle class, basically the mass. Hence the price of the product has to be reduced and also parallel carrying of the image, such that each of these doesn’t conflict with the one another. One of way of doing this would be create a perspective that every Indian inherits the royal culture and heritage, and he deserves this product.Branding and Promotion As mentioned earlier we would be branding the Mysore sandal soap as a royal image in the mind of the consumers. To do this we use a brand ambassador (Dhoni was obviously a disaster) who has a royal background preferably from south who has probably carried the image of the country and made it proud on some occasion.
We could use a Miss India – a new face India in the international arena or someone like Deepika padukone who is a south Indian, with a celebrity status and family background which people are proud off.Even if Rahul Gandhi could be convinced to talk about the soap in some occasion, it could be used as an advertisement for the product. Who could portray the royal culture than a heir of the Gandhi family himself. We could also use different cultures of the country and try associating it with the soap. Say for example: the Coorgi or Mysore culture with sandal soap. There could be large scale promotion during the Dasara session so that people relate it to the culture. The promotion has to be very aggressive as there is an immediate requirement for the Re-branding.
We would use major events like budget, IPL etc(following the success of ZUZU) for the launching of the promotion. Another aspect would be the viral marketing, Social networking sites and blogs to get the brand popularized with the Y generation Distribution method Under the Distribution Method we would concentrate on online mode of buying the products with special offers, discounts to encourage direct selling as the middle layer burden would be eliminated and the advantage could be passed on to the consumer. This feature also enables to maintain a database and provide a better customer feedback.Online way of selling to the mass market????? In the urban centre more focus would be on super markets – where people usually come for experience and a right place to intensify our promotion as we are promoting the product itself as an experience. Urabn you want to focus on supermarkets???? Under the distribution Method one of the major focus areas would be that of ensuring the products to reach the rural areas across the length and breadth of the country. Company would have to spend extensively to build its distribution channel so that it can penetrate deep into the market.Use of NGO’s, Microfinance Institute and Self Help groups to create awareness in the rural market would be one of the strategies in reaching out for the same.
Using Mobile Technologies – bulk messaging, Ads in the Regional TV and Radio channels and large scale campaigns – free samples will provide the product a strong stand among the rural crowd. Why is the font different Conclusion Low margins and high volumes characterize soap industry. While the level of disposable incomes determines the overall sector growth, the market has already been segmented and sub-segmented.Brand loyalty is very low, Positioning of the product is very important in this market. Key factors to success are distribution (in rural markets) and advertising (in urban markets). Innovation holds the key. Consumer awareness of KSDL’s products is very less except for Mysore Sandal soap because of its weak marketing.
Therefore it should spend both money and man power on advertising and promotion. Company should also build up strong distribution channels and try to increase the sales of their other products and not only Mysore Sandal Soap.Its products are not available easily in states other than Karnataka and hence it needs to focus on increasing its distribution spread. The R&D should also work effectively and achieve break-through in new products to make the company earn more profits. The company’s plans to enter into new product ranges like shampoo, dish wash, detergent bar & room refresher should be carried out and promoted aggressively. The project was very helpful in gaining a complete understanding of the various strategies and concepts and how they are being implemented in a real business environment.
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