Market Analysis of Gillette India Limited

MARKET ANALYSIS OF GILLETTE INDIA LIMITED

Good afternoon Sir, My project title is Market Analysis of Gillette India Limited a renowned FMCG Co. operating in India since last 25 yrs.1

A BREIF INTRODUCTION Incorporated on 9th February 1984 as Indian Shaving Products Limited (ISPL) Company was jointly Promoted by (HOPE) and Gillette Company, U.S.A. (Gillette). Became Subsidiary of P&G in 2005. Business Segments Personal Grooming, Oral Care & Portable Power. Till date Gillette India has launched many innovative products to capture Indian consumers. Captured a major market share in premium shaving care segment. Carved a reputation for delivering high quality, value-added products. Focus on Personal Grooming Products Especially on Shaving Cream / Gel / Foam Segment.

Gillette India Limited was incorporated on 9th Feb. 1984 as Indian Shaving Products Limited (ISPL).

The Company was a joint venture of House of Poddar Enterprise, Rajesthan and Gillette Co. USA.

It then became a Subsidiary of P&G in 2005, when the Gillette Company, USA was acquired worldwide through merger in October, 2005 by Procter& Gamble Company, USA creating the largest Consumer products Company in the world.

The company operates in three business segments Personal Grooming Shaving Gels / Foams, After Shaves & deodorants , Oral Care Toothbrushes (Oral B) , & Portable Power Alkaline Batteries.

Since its inception, the company has launched many innovative products like, Shaving Gels, Foams, Ready Shaver etc.

GIL has captured a major market share in premium shaving care segment. Where the blades & razors of the Co. are being sold without facing much competition, the Co. is pioneer in introducing the Shaving Gels & Foams in the Indian markets.

Gillette India has in its portfolio renowned brands like GILLETTE SERIES, GILLETTE MACH 3 TURBO, ORAL-B and DURACELL - world's leading brands and has carved a reputation for delivering high quality, value-added products to meet the needs of consumers and hence Gillette is amongst the most renowned brands in India Today.

The focus of this project is on the Shaving Cream / Gel / Foam segment of the Co.2

PERSONAL GROOMING INDUSTRY AN OUTLOOKEstimated to be worth $ 4-bn.20% Growth recorded in 2008.Gillette India recorded 16% Growth in 2008.Still in an infant stage.Opportunities for Gillette, Colgate Palmolive & others

Indian Personal Care Market

Here we can see how the Indian personal care market is divided. The Indian Personal Care market is estimated to be worth $ 4 bn. Gillette India Limited has recorded the growth of 16% during the year ended 2008. During the year under review, Personal Care business also recorded over 20% growth driven by increased preference for shaving gel over cream. However, the current consumption is still below many countries in Asia which shows that there are further growth opportunities.Thus, the industry is growing at a decent rate but still is at an infant stage and this offers great opportunities to players like Gillette and Colgate Palmolive to expand their customer base to include higher number of lower middle class people and thereby increase their revenues and profitability. 3

GILLETTE INDIA LIMITED THE 4PSPRODUCTPRICEPLACEPROMOTION

Now we will have a look at the 4Ps of Gillette India Limited.4

PRODUCT

And the first P is Product. Here we can see the various business segments in which GIL is operating. Presently it is operating in three business segments Personal grooming in which it offers Razors/Blades, Shaving Brushes, Gels & Foams and After Shave preparations. The Brands under personal grooming segments are Mach 3 Turbo, Vector plus, Gillette Series, Gillette to name a few. Under Portable power segment we can see that the Co. offers Alkaline Batteries under the brand name of Duracell. Oral care segment of the Co offers toothbrushes and other oral care products. The toothbrushes offered comes under the brand Oral B.5

PRODUCT

The BCG Matrix

Duracell

Market ShareMarket GrowthMen ToiletriesRazorsOral B

Here comes the BCG Matrix of Gillette India Limited that analyzes the various products offered by GIL in the 4 quadrants of the matrix. We can see from the figure that most of the products excluding Shaving Gels / Foams and other men toiletries like deodorants are enjoying great market share and are the Cash cows of the company. i.e. the company can use the revenue generated by these cash cows to finance men toiletries which has got tremendous potential in Indian markets.6

PRODUCT

6 VARIANTS IN SHAVING GELS (Metallic Cylinders)Sensitive Skin, Moisturizing, Extra Comfort,Cool Cleansing, Pure & Sensitive and Protection.Size: 210 ml.

3 VARIANTS IN SHAVING GELS (TUBES)Sensitive Skin, Moisturizing, & Ultra Conditioning4 VARIANTS IN SHAVING FOAMS (Metallic Cylinders)Sensitive Skin, Pure & Sensitive, Conditioning & Cool Cleansing

These are the variants of Shaving gels and foams offered by GIL under the brand Gillette Series. As we can see it here on the slide it offeres 6 variants in Shaving Gel in Can packing. 3 variants of Gel in Tube Packing and 4 variants of Foams in can Packing. The packing is ultra modern and uses a high graphics to catch the attention of consumer.7

PRODUCT

CORE BENEFITBASIC PRODUCTEXPECTED PRODUCTPOTENTIAL PRODUCT LOOK GOOD SHAVING CREAMWITH MOISTURISER GEL BASEDFACE CREAMAUGMENTED PRODUCT

This analysis shows where the Gillette Shaving Gels and foams falls in the consumer value heirarchy. As we can see here the core products or the basic product is Shaving Cream which actually satisfies the basic need of the product. Expected product by a consume would be a shaving cream or gel along with moisturizer. Augmented product covers Gels that provide extra lubrication than cream and comes in many variants. A potential product in Shaving Cream / Gel/Foam segment would be a Gel or a foam that also serve the purpose of a face cream even after washing the face when the shave is over. Most of the Gillette Shaving Gels and Foams falls under the category of Augmented and Potential Products which implies that the product range under the Shaving Cream/Gel/Foam segment offered by GIL are premium range and targets only premium customer base of Indian markets.8

PRICE

Sr. No.ProductsWeightPriceRLP*1.Gillette SeriesShave Gels (Cans)210 ml.249/-222.32/-2.Gillette SeriesShave Gels (Tubes)30 gm.30/-26.69/-3.Gillette Series(Foams)210 ml.225/-187.05

PREMIUM PRICING All Products are in a premium category Pricing well above the industry average Leveraging Consumer Loyalty

Here is the second P Price. We can see that all the Shaving Gels and Foams offered by GIL are priced well above the industry average. Where the renowned shaving creams are priced somewhere around Rs 45/- the Gels and Foams have the price of Rs 249/- and 225/-. Thus all products are in premium category. By adopting premium pricing policy, Gillette India is actually leveraging its consumer loyalty.9

PLACE

Nagpur (Hub)P&G DepotGondiaChandrapurHinganghatYeotmalAkolaAmravatiThe Spoke and the Hub Distribution Model of Gillette IndiaGillettes own network in India reaches 1 lakh outlets in 3600 towns

Now Using additional P&G distribution channel

Hub and spoke approach

20 hub cities and spokes are Tier 2 and Tier 3 cities

Now we have the third P which Place or Distribution element of the 4Ps of Gillette India Limited. Gillette India has got its own network in India that reaches more than 1 lacs outlets in 3600 towns. Post merger, Gillette India is benefiting from the synergies of P&G and now it has been using P&Gs additional distribution channels. It is really helping the Gillette India Limited to penetrate more deeply into the market. Gillette India is using the Spoke and the hub distribution Model. There are 20 hub cities and the spokes are Tier 2 & Tier 3 cities. Here we can see the diagrammatic representation of Nagpur Hub and Its Spokes.10

PLACE

Business Executive(C.G. Marketing) - 1

Distributor(C.G. Marketing)

Area Sales Manager(P&G) - 1

Sales Trainee Leader(C.G. Marketing)- 5

Visibility Captain(C.G. Marketing)- 17Delivery Boys(C.G. Marketing)- 12Distributor Sales Exe(C.G. Marketing)- 18

The small number of routes generally leads to more efficient use of transportation resources.

Complicated operations, such as package sorting and accounting, can be carried out at the hub, rather than at every node.

Spokes are simple, and new ones can be created easily.

Customers may find the network more intuitive. Scheduling is convenient for them since there are few routes, with frequent service.ADVANTAGES

On the right side of the slide is given the distribution network of Nagpur branch office. There is only one distributor for entire Vidarbha C.G. Marketing, Pune. The Distribution system of Nagpur Branch Office has an Area Manager (P&G) who is responsible for the overall administration of the distribution system of entire Vidarbha. The Business Executive (C.G. Marketing) works in close coordination with the Area Manager. There are 5 STL presently in Nagpur BO who are providing Training to DSEs VCs and others down the hierarchy. DSEs are responsible for taking orders from retailers. According to their Beat Plan, Every DSE is suppose to visit an area every week i.e. he visits a particular retail shop four times in a month to take their orders. VCs are responsible for taking care of the stock of the company in a particular shop. They arrange the stock of a retail counter every week and make sure that the stocks are properly displayed. Delivery Boys deliver the order taken by DSEs on very next day through delivery vans. Nagpur BO has 10 delivery vans. Here we can see some of the advantages of Spoke and the hubs distribution model. LikeThe small number of routes generally leads to more efficient use of transportation resources.

Complicated operations, such as package sorting and accounting, can be carried out at the hub, rather than at every node.

Spokes are simple, and new ones can be created easily.

Customers may find the network more intuitive. Scheduling is convenient for them since there are few routes, with frequent service.

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PROMOTION

Strong and sustained advertisement all through out

Gillette brand has high recognition rate

Massive influence, recall and saliencereminder advertising

Successful MACH3 launch campaigns

Focus on brand values, innovation and cutting edge technology

AIM- to educate consumer on product advancements and improved shaving performance

Here comes our fourth P Promotion. GIL has a strong and sustained advertisement all through out. You might have seen many TV ads of Gillette Shaving Razors and Blades and hence Gillette Products has got high recognition rate. This project has proved it that, among all the competing brands Gillette has the highest Brand recall. Continuous hammering i.e. showing ads at regular intervals on prime TV Channels on daily basis has contributed to a great extent in consumer brand recall for Gillette products. The successful Mach 3 campaigns are the best examples. The promotion programs are focused on building brand values, innovation and cutting edge technologies. Most of them aim to educate the consumers on product advancements and improved shaving performance.12

PROMOTION

Tie up with Rediff-on-the-Net e-commerce to market its product

Tie up with ZAPAK for The India Gaming Championship 2009

Endorsed by eminent sports personalities

Used sports as a major promotional vehicle

Soccer Saturday sponsorship launched MACH 3, Turbo and M3 Power successfully

Less Attention on Shaving Gels & Foams

PROMOTIONAL ACTIVITIES

Here we can see some of the promotional activities of Gillette India Limited.Tie up with Rediff-on-the-Net e-commerce to market its product

Tie up with ZAPAK for The India Gaming Championship 2009

Endorsed by eminent sports personalities like Rahul Dravid, David Beckham, Roger Federer Tiger Woods & Thierry Henry

Used sports as a major promotional vehicle

Soccer Saturday sponsorship launched MACH 3, Turbo and M3 Power successfully

Less Attention on Shaving Gels & Foams

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PROMOTION

PROMOTION

ATTENTION- BY ADVERTISEMENT

INTEREST- BY FEATURES

DESIRE-ADMIRATION BY OPPOSITE SEX

ACTION- PURCHASINGTHE AIDA MODEL

Attention-promotions are surely attention grabbing. Words like extra, free ,win help products stand out among shelvesInterest-promotions can inject fun and adventure in to the most mundane activitiesDesire- lured to have a fair and clean look and be admired by the opposite sex, shown in the adsAction- Customer buys the product

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RESEARCH OBJECTIVES Gauge brand recall for various Shaving Creams/Gels/Foams brands, specifically Gillette. To understand the Buying Intention of Gillette Shaving Gel and Foam users.To understand the brand loyalty of customers towards Shaving Creams/Foams/Gels. Identify how Gillette India can become Market leader in Shaving Creams/Gels/Foams

Now that the project has just analyzed the 4Ps of GIL let us now come to what were the objectives of conducting this research and how the research has actually been implemented. Here the project had 4 prime objectives which were Gauge brand recall for various Shaving Creams/Gels/Foams brands, specifically Gillette. To understand the Buying Intention of Gillette Shaving Gel and Foam users.To understand the brand loyalty of customers towards Shaving Creams/Foams/Gels. Identify how Gillette India can become Market leader in Shaving Creams/Gels/Foams

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HYPOTHESESThe Two Hypotheses made in the beginning of the study were:

Gillette Is The Most Renowned Brand In Shaving Product Market In India.

Gillette Can Become A Market Leader In Shaving Product Market In India.

The Two Hypotheses wereGillette Is The Most Renowned Brand In Shaving Product Market In India.

Gillette Can Become A Market Leader In Shaving Product Market In India.

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RESEARCH DESIGNProblem DeterminationExploratoryResearchCauses of ProblemsDescriptiveResearchAnswers to ProblemsTHE IMPLEMENTATIONData CollectionPhase I : Secondary Data CollectionPhase II : Depth Interviews (Exploratory Research)Phase III: Consumer Survey (Descriptive Research)

Here we can see the research design and the actual implantation of the research work. In the Phase one of the implementation the researcher had collected the secondary data on History of Gillette, Industry Profile and the like. Then the Primary research was carried out. To design a questionnaire that is well informed in itself, the project needed to know thoroughly about the attributes of Shaving Creams / Gels / Foams which a consumer looks for when he makes his purchasing decision. To know about all these attributes, two Depth Interviews had been conducted which also helped a lot in designing the consumer survey questionnaire. This was an exploratory research. We use exploratory research when the problems are ill defined or when the problems are not clearly determined. From the results of DIs, a pilot questionnaire was framed. The purpose here was to getting an accurate snapshot of particular aspect of the market environment hence the pilot study was a descriptive research that helped in identifying all possible problems and factors influencing buyer behavior. An analysis of this pilot questionnaire was done. From the analysis, the redundant variables, hard to analyze variables etc were removed so that people may easily fill in the questionnaire. After the pilot test, the final questionnaire was formed. The questionnaire was designed to capture both quantitative and qualitative information. 17

The Universe of the Sample:All People aged 18 to 70 years of Nagpur were randomly selected, who have purchased Shaving Cream/Gel/Foam.The Sampling Frame:Shopping Malls, Mens Parlors, Residential Areas and other public places like Restaurants.The Sample Size: 100.

SAMPLING TECHNIQUE

The Sampling technique which had been adopted in the project is given here; The universe had all people aged 18 to 70 years of Nagpur and people were randomly selected. The survey was conducted on various places like malls, saloons residential areas etc. and the sample size was 100.18

DATA ANALYSISBRAND RECALLGILLETTE HAS THE HIGHEST BRAND RECALL

Once the data were collected using primary and secondary research, the researcher then started processing of data using softwares like Microsoft Word, Excel. The data was analyzed using various tools such as templates of swot analysis, the fishbein analysis which helped the researcher to know about the attitude of consumers towards each brands. Here we can see from the graph that Gillette has the highest brand recall among all the competing brands. Out of 100 respondents 93 respondents could easily recollected the name Gillette.19

DATA ANALYSISBRAND LOYALTYGILLETTE HAS THE HIGHEST BRAND LOYALTY

Brand loyalty has been measured collectively for all the brands in the questionnaire. 86% of the respondents will purchase their preferred Shaving Cream / Gel / Foam brand from some other stores if it is not available in the store they have visited and 63% of them will still continue to purchase their preferred brand even if the price of their preferred brand increases. Among all the brands, Gillette has the highest brand loyalty with 98% of respondents who are using Gillette will purchase their brand from some other store even if it is not available in the store to which they have visited and 99% of them dont care if the price of Gillette increases.

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DATA ANALYSISPREFERRED BRANDGILLETTE EMERGED AS THE MOST PREFERRED BRANDS

The consumer survey has proved that Gillette is the most preferred brand of the sample population.21

DATA ANALYSISBRAND SATISFACTION

72 % of the respondents who use Gillette Gels and Foams are satisfied and 23 % are highly satisfied which proves that Gillette products are of high quality and are meeting the needs of its consumers beyond their expectations in most cases.22

DATA ANALYSISBUYING INTENTIONGroup 1: Price Stylish package design Antiseptic attribute Color of the cream/foam/gel Lather formation Availability in stores Offers/Discounts Brand name

Group 2: Ease of Use Keeps the skin soft Ingredients Fragrance Lather formation Availability in stores Offers/Discounts Brand name

COMMON ATTRIBUTES

There were a few questions in the Consumer Survey Questionnaire which were designed to elicit the buying intentions of the surveyed sample. These questions measured the importance of 12 attributes of various Shaving Cream / Gel / Foam like Price, Brand Image, Fragrance, Offers & Discounts etc. in the purchasing decision of the surveyed sample. These attributes were found out in the DIs of two groups. The common attributes of the two groups are underlined here.

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DATA ANALYSISFISHBEIN ANALYSIS

This is the most interesting and most important analysis of this project. Fishbein Model is used to measure the attitude of customers towards each brands. The survey also measured the attribute scores for other competing brands like Godrej, Palmolive, Old Spice and Dettol. Along with the data for Gillette, an average attribute score was computed across the 100 samples for each attribute for each of the brands. Fishbein analysis was performed by converting the Likert scale from 1 to 5 to -2 to 2. Consumers attitude about each brand was calculated and plotted as shown in this graph.

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RECOMMENDATIONS Launch Matured products like regular Foams & Razors in neighboring countries. Launch Gillette Shaving Cream & Other Personal Grooming Products. Promote Gillette Shaving Cream / Gel / Foam more aggressively.

regular foam and Gillette 7O Clock regular razor are on the maturity/decline stage in the metropolitan cities. Without much effort, these products can be promoted aggressively in neighboring countries like Bangladesh, Srilanka and states like Orissa, Bihar and the North East and can have a revitalization and an extended maturity phase.

Launch Gillette Shaving Cream & Other Personal Grooming Products.

Promote Gillette Shaving Cream / Gel / Foam more aggressively.

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Thank You !

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