Eureka Forbes Limited

EUREKA FORBES LIMITED

Submitted to:
Vandana Gupta
Amity Business School

Submitted by:
Vivek M/309E 35/Section E
Akhil Bhasin/309E 40/Section E
Siddharth Rinwa/309E 50/Section E
Geeta Ravi/309E 52/Section E
Abhash Kumar/309E 54/Section E
Rachit Goyal/309E 57/Section E

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ACKNOWLEDGEMENT

We would like to express our gratitude toward Mr. Sanjeev Sharma, manager of Eureka
Forbes branch, Sector-2, Noida.

We would also like to thank our teacher, Vandana Gupta, for helping us ask the right
questions.

Vivek M
Akhil Bhasin
Siddharth Rinwa
Geeta Ravi
Abhash Kumar
Rachit Goyal

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CERTIFICATE FOR ORIGINALITY

We hereby declare that the intellectual content of this thesis is an integration of the
knowledge that we built up on interviewing the concerned people and researching the
internet.

Vivek M
Akhil Bhasin
Siddharth Rinwa
Geeta Ravi
Abhash Kumar
Rachit Goyal

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TABLE OF FIGURES

Figure 1: Marketing Mix

Figure 2: Market Share of Eureka Forbes’s Vacuum Cleaners

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TABLE OF CONTENTS

Chapter 1: Introduction to Eureka Forbes Limited 6

Chapter 2: Products offered by Eureka Forbes Limited 7

Chapter 3: Water Purifiers 8

Chapter 4: Vacuum Cleaners 12

Chapter 5: Air Purifiers 16

Chapter 6: Security Solutions 17

Chapter 7: Eureka Forbes: The Brand 18

Brief Interview with Mr. Sanjeev Sharma 19

References 23

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Introduction to Eureka Forbes Limited

HISTORY BEHIND EUREKA FORBES

Eureka Forbes Limited (EFL) is the leader in domestic and industrial water purification
multi-product, multi-channel corporation-part of the Shapoorji Pallonji Group. About
7,000 employees are working in the company. EFL is the Leader in domestic and
industrial Water Purification Systems, Vacuum Cleaners, and Air Purifiers & Security
Solutions. EFL is the Pioneers in Direct selling - Asia's Largest Direct Sales
Organization. About 6,000 strong Direct Sales Force touches 1.50 million Indian homes,
adding 1,500 customers daily. Customer family now numbers over 6 million – enduring
relationships as friends for life. The Operations of this company is going on 125 cities &
400 towns across India.

EFL also expanded channels that reach out to customers to include. This company has
Over 5,000 strong Dealer Sales Network in India .and also have 58 distributors for strong
Institutional Sales Network. This company has Security Systems Division that is one of
India's largest system integrators. EFL have a strong service network that backs up sales
efforts. About 4500 company trained technicians who make 20,000 kitchen visits daily.
That is supported by Call Centers, Customer Care Representatives & Mobile Service
Vans.

Eureka Forbes - A Business Super brand .this company’s Aqua guard & Euro clean -
Chosen Super brands. This company is ranked among India's Most Admired Consumer
Durable Companies. This company awarded for The Best Employers (4 times in a
row) .This Company is the Winner of 'Most Admired Knowledge Enterprise' MAKE-
Asia Awards, Winner of awards on Customer Responsiveness, Winner of Water Digest
awards. EFL Vision is to make a happy, healthy, and safe & pollution free environment
on truest and lasting relationship with customers. EFL’s mission is To Build sustainable
relationship with customers as their ‘Friend for life’ by satisfying their evolving health,
hygiene and life style need through.

STRATEGIES ADOPTED THAT HAVE MADE EUREKA FORBES A POPULAR

BRAND NAME

1. Direct Marketing
EFL was the first to introduce water purifiers and vacuum systems into the Indian homes.
As these products were unknown to the Indian market, therefore advertising campaigns
were impossible. Hence EFL chose the less traveled direct selling route. Direct method is
a method that aims at establishing a direct connection with the potential customers and
cultivates a lasting relationship. EFL was the first company to venture into the same and
now is Asia’s largest direct selling organization.

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Introduction to Eureka Forbes Limited

2. Advertisement Campaigns
Many companies, while selling a new product in the market find that sales cannot be
sustained without constant advertising. Sales charts always show a meteoric rise post-
advertising burst. Eureka Forbes often runs advertisements on different channels over the
year to sustain the brand awareness and ensure that the consumers are exposed to the
brand.

3. Dedicated Service Help-line

Eureka Forbes has over 1000 service centers in all major cities in India with more than
5000 trained service technicians. Theirs is the largest After Sales net work in India. Yes,
we have a dedicated 24 hours single number access help line in 8 major cities.

4. Marketing Mix
PRODUCT
a) Easily available nation wide.
b) Easy to handle.
c) Multiple products launched for each
product type.
PROMOTION
a) Active subscription immediately.
b) Right time installation of products.
c) Properly repair services against
paid AMC’s.
d) Service during contract period.
PRICE
a) Product price range divided into
four segments to target different
audiences.
b) Low cost of maintenance and
consumable.
c) Best prices offered when compared
to other competitors.
PLACE
a) Urban educated India that cares for
their family.
b) Areas prone to diseases.
c) Strategically chosen locations for
catching the eye of potential
consumers.
d) Various stalls near market places
and food bazaars.

Figure 1: Marketing Mix

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Products offered by Eureka Forbes Limited

1. WATER PURIFIERS

2. VACCUM CLEANERS

3. AIR PURIFIERS

4. SECURITY SOLUTIONS

Image Source: Eureka Forbes

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Water Purifiers

MARKET SCENARIO

Clear drinking water is a huge problem in India. The water that comes through the tap is
often salty, and is riddled with bacteria. So, selling water purifiers is a big market in
India. In fact, estimates show that it might be worth up to Rs. 710 crore. Companies are
advertising heavily on television to grab a piece of the market preying on the fears of the
general public.
People often do not comprise when it comes to the safety of their family and so are
willing to spend a months wage on buying a water purifier.

Buying a water purifier can be a nightmare as there are so many to choose from with
different features. Some of them include:

• Aquaguard
• Kent
• Pristine
• Philips water purifier
• Aero
• Videocon water purifier
• KenStar
• Pureit

Each of the above brands has many different water purifiers within it which clean the
water in different ways and are priced accordingly.

Eureka Forbes is a specialist in 5 water technologies, addressing 17 diverse water

conditions. Over 71 million liters of Aquaguard water is consumed daily. Eureka Forbes
is the world's largest manufacturer of Ultraviolet based Water Purification System, with
over 20 products (RO, UV, NF, UF, RO +UV) and over 6 million units sold.

Eureka Forbes today has over 60% of the Rs. 710 crore Water Purifier market.
When the company launched AQUAGUARD in 1986, water purification in India meant
boiling water to make it potable.
This fact only high lightens the tremendous success Eureka Forbes has managed to gain
in the Indian market.

When it comes to selling water purifiers in India, the Aquaguard range of water purifiers
from Eureka Forbes are without doubt the leaders in the lucrative water purifier market!
Aquaguard has quality products that are unmatched by most other water purifiers in the
market.

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Water Purifiers

AQUAGUARD-WATER PURIFIERS

According to their catalogue, they have over 20 water purifiers ranging from Rs.2,000 to
Rs.25,000. Their range of products treats the water with varying levels of technology.
The main difference is that the expensive systems like the Integra Hi-Life have larger
water production capacity per hour, more water storage capacity, and use the Reverse
Osmosis Technology (RO) to treat the water.

Without getting too scientific, Reverse Osmosis water purifiers use a thick membrane to
provide a barrier for solute materials. All particles such as bacteria and viruses are
stopped by the membrane while pure water is allowed to go through.

AQUAGUARD CLASSIC INTEGRA HI-LIFE: Price

: Price Rs.8,000 Rs.19,000

Image Source: Eureka Forbes

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Water Purifiers

SELLING STRATEGIES ADOPTED

1. Direct Selling- Door-to-Door Selling

Eureka Forbes has an approach to sales that is well-worn in the West but is not so
common in India. Unlike Procter & Gamble, which relies on closet-size, mom-and-pop
stores to sell its products, Eureka Forbes cuts out the middleman and instead uses a team
of young salespeople to give in-house product demonstrations and convince consumers of
a need that they didn't know they had. In its early days the company only sold vacuum
cleaners. It has managed to persuade Indians to stop boiling their otherwise undrinkable
tap water and instead use a now-ubiquitous water purifier better known as "Aquaguard".

2. Product Segmentation
Eureka Forbes sells different water-purifiers on the basis of classifying their utility and
price affordability. The water purifiers are classified as follows:
• AQUAGUARD-ECONOMY
• AQUAGUARD- TOTAL PROTECTION
• AQUAGUARD-SPECIAL USAGES
• AQUAGUARD- DIRECT ONE

The High End models are made available only through the Trained Direct Sales
Specialist of Eureka Forbes, by giving a HOME DEMO
The Low End models have been made available in all leading consumer electronics and
home appliances show rooms across the country.

3. Making and Growing Relationships- An Irreplaceable Commodity

Whether people end up buying Aquaguard from a giant store or a door-to-door salesman,
EFL’s crew tries to stay close to the customers. After each sale a Eureka Forbes plumber
installs the water purifier. Service technicians conduct periodic maintenance. Customers
can get their water tested at 15 "Aquacheck" water labs throughout the country

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Water Purifiers

PROBLEMS

1. Annual Maintenance
The membrane and other parts of the water purifier need yearly maintenance and that is
where the customer issue comes up
One would have to pay for the maintenance cost and any parts that are damaged/worn out
(most likely after 1-2 years). It might cost you an additional Rs.2,000-3,000 per year.

2. Customer’s Service
Overall, Aquaguard has fantastic products but their customer’s service needs a major
overhaul.

3. Threats from MNC’s

Eureka Forbes must position itself to compete or to be acquired. To compete, they need
to be as efficient as possible in order to keep prices down if and when competitors move
in. A $175 Aquaguard wouldn't sound so appealing next to a Brita Purifier from
Wal-Mart at $30.

SUCCESS OF “AQUAGUARD”

1. Aquaguard has wide acceptance as a generic name for water purifiers

Successful acceptance of a product by the masses results in brand names becoming
synonymous with the product category. For example, say 'Cadbury' and one recognizes
'milk chocolate', say 'Xerox' and one understands photocopiers. With Aquaguard, one can
easily associate Water purifier.

2. Aquaguard most trusted brand: Reader’s Digest gave it this title in the year 2007
after an extensive survey for being the best domestic water purifier.

3. Aquaguard creates record - 41,400 Homes Aquaguarded in the month of July, 05

In July 2005, Aquaguard created history by becoming the largest selling water purifier
across the country.

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Vacuum Cleaners

THE BEGINNING:

Eureka Forbes (EFL) has come a long way. From being famous (or infamous) for
pioneering the direct selling in India to being rated as the best employer and top it all a
case study at Harvard. Eureka Forbes is a joint venture between Forbes (India) and
Electrolux from Sweden. Eureka Forbes first launched the Vacuum cleaners in India.

OBSTACLE AT THE INITIAL PERIOD:

EFL initially faced lot of problem in marketing its vacuum cleaners. Targeted at the
upper middle class families, these products were never considered a priority. Since most
of the middle class families could afford a maid, it was a fight between Maid and the
Machine.

SELLING STRATEGY ADOPTED:

1. Because of the low interest and since the product benefits needs to be demonstrated to
the customers, conventional distribution was not viable. Hence EFL chose the less
traveled Direct Selling route.

2. Professional Sales Approach

The Eureka Forbes sales man was called Eurochamp. It was a tough job for these
salesmen who had to go through the "cold calls" to get a sale. At one point of time,
because of the aggressive nature of these sales persons, people became scared even to
listen to these sales persons. Now this aggression has mellowed down to a more
professional sales approach.

3. Eureka Forbes has also tried to position their sales persons as problem solvers rather
than sales officers. The campaigns tried to build the image of a Euro champ as a Friend
rather than one that is after the money.

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Vacuum Cleaners

MARKET SCENARIO:

Indian Vacuum Cleaner Market is worth around 120 crores. Eureka Forbes is a market
leader in vacuum cleaners with an 85 per cent share of the 2.5 lakh vacuum cleaners sold
annually in India.

Figure 2: Market Share of Eureka Forbes’s Vacuum Cleaners

PROBLEMS IN PRICE AND USAGE PATTERN:

One of the major problems faced by both these markets is the price barrier. Vacuum
cleaners were expensive when it was launched, but looking at the website of the
company; the prices have come down sharply which will expand the market. Second
problem with vacuum cleaner is the lack of product usage at homes. Most of the vacuum
cleaners are lying idle which is bound to create a negative word of mouth. EFL may have
to do a follow up on helping customers to use the product regularly.

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Vacuum Cleaners

FACTS THAT MAKE EUREKA FORBES VACUUM CLEANERS-

UNIQUE IN THE MARKET THE 4 CRITERIA FACTOR:

If we take a look at the analyzed details in the above sections, it is evident that Eureka
Forbes has turned the ‘disturbing & annoying’ image of sales persons in to a ‘friend to
the family’. Not many companies were able to accomplish this. So what makes them so
strong in their target achievement? This is where our analysis of their Selling Strategy
starts.

When we look at their perspectives, majority of their sales have been through Direct
Selling, and they are still continuing with the practice. In terms of Strategy, the following
four criterions define their success in the market:

• USER POSITIONING
• BENEFIT POSITIONING
• VALUE FOR MONEY
• USER FRIENDLY SALES PERSONS

USER POSITOINING:

The way Eureka Forbes has pitched in to the market with its wide range of products has
allowed the users to select from the extensive choices available according to their
preferences. For example, the various models in vacuum cleaners are as follows:

EUROCLEAN:
 TURBO
 POWERWASH
 WET & DRY
 ACE NEW
 ULTIMA

FORBES:
 EASY CLEAN
 EASY CLEAN LITE
 TRENDY NANO
 SWIFT
 TRENDY STEEL

Two major categories in Eureka Forbes were studied, and it was amazing to see the
number of sub-products under them. Each had distinct features varying from each other
in terms of price, function, usage, etc. In this way, Eureka Forbes has been able to

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position themselves according to the users needs, whatever it may be- price, style,
functions and so on.
Vacuum Cleaners

BENEFIT POSITIONING:

As seen in the above segment, Eureka Forbes has introduced a new product with added
benefits at regular intervals in the market. Each product comes with a specific benefit,
apart from the normal features (Benefits are those special additions whereas features are
the normal aspects present). For e.g.: FORBES products are for Daily cleaning purpose
and EUROCLEAN are for deep cleaning purpose. In particular, if we take EURO
CLEAN WET & DRY, the multi-purpose Euro clean WD not only removes dirt and dust
from floors, carpets, famishing and other inaccessible areas, but also wet cleans your
floors & tiles and takes care of wet spills, giving you a clean and healthy home. In the
case of FORBES EASY CLEAN it is a Multipurpose Daily Use Vacuum Cleaner,
Suction & Blower Functions, and Shoulder Strap for easy usage and Hand Held.
Multipurpose Daily Use Vacuum Cleaner, Suction & Blower Functions, Shoulder Strap
were designed for easy usage and in a convenient hand held position. In such ways, each
product is positioned with its exclusive benefits in the minds of the customers.

VALUE FOR MONEY:

The price factor for Eureka Forbes was a big obstacle at the initial time when it was
targeted mainly towards the middle and upper middle class segment. But as time
progressed, they have come up with a varying range of products priced according to the
features and added benefits. Value for Money thus has always been a major factor for the
long term sustainability of the Eureka Forbes Vacuum Cleaners in the market.

USER FRIENDLY SALES PERSONS:

Success to Eureka Forbes became a case study at Harvard Business School. The driving
factor behind this was the excellent workforce of Sales persons Eureka Forbes has
developed and maintained over a long period. The key high lights are as follows:

The sales persons were recruited with efficient analysis and effective training was
instilled to them.
Training included how to cope up with the stress in the Customer meetings, since door to
door selling invited the annoying response from the customers.
Various approaching Strategies were taught to them with the aid of case studies and Role
play activities.
With all these training & development activities, sales persons from Eureka Forbes were
not just sales force trying to sell product to customers, but became friends to their
families providing suggestions and solutions.

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Air Purifiers

In addition to the Water Purifiers and the Vacuum Cleaners, Eureka Forbes also provides
Comprehensive Air Purification System to clean indoor air of all common pollutants,
creating a clean, healthy & pleasant environment.

Eureka Forbes offers its products through dealers and institutional sales network.

EUREKA FORBES - AIR PURIFIERS

According to their catalogue, they have over 2 Air purifiers ranging from Rs.6400 to
Rs.9,900. Their range of products treats the Indoor Air with varying levels of technology.
The main difference is that the expensive systems like the Euro Air Genious have the
ability to gauge the level and any kind of pollution in the house before purifying it

A) EUROAIR

Features
1. Two Optional Filters to suit user's choice
2. Electrostatic Filter
Price- Rs 6,400

B) EURO AIR- GENIOUS

Features
1. Smart Sensors (SS)
2. Higher Air Flow
3. UV Lamp that effectively kills bacteria and germs present in the air
Price- Rs 9,900

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Security Solutions

Eurovigil from Eureka Forbes provides complete safety for living & business.

Solutions customized for homes, institutions & corporates, each solution from Eurovigil
is tailor-made for unique requirement.

An array of products - intrusion detection, access control, surveillance & fire detection,
the Eurovigil solutions are state-of-the-art security solutions providing total safety.

The strategic tie-ups with world's leading companies in security solutions like Notifier,
Honeywell, Bosch and many others make the Eurovigil systems the ideal solution for
homes and business.

Security Solutions from Eureka Forbes include 24-hour door watch systems that enable
people to see and speak to their visitors, before granting them access to their your homes.

EUREKA FORBES – SECURITY SOLUTIONS

According to their catalogue, they have over 9 Security Solutions. The products are as
follows:

1. Video Door Phone

2. I-See
3. I-Link B100
4. I-Link BW 200
5. H 100
6. HW 200
7. OMNI 400
8. VISTA 20P
9. LYNX REN

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Eureka Forbes: The Brand

CORPORATE SOCIAL RESPONSIBILITY

To be successful in this competitive business world, balance sheets and growth rates are
no more the only parameters to be considered upon. Days have changed when Customers
brought money and bought products. Of course, provided the amount of online facilities
available, purchase can be made at any time through any mode. But that is not the crux of
this discussion. This is the age where people have started seeing companies and
organizations with a much broader vision. The service they provide to the society and
humanity has become a vital factor of the company’s brand image. In a word, it is the
popular word “CORPORATE SOCIAL RESPONSIBILTY”. Eureka Forbes has been
instrumental in performing various social activities which has embedded a good image of
it in the customers’ hearts. A few of the many CSR activities are as follows:

 Opening of Nana Nani parks for Aged persons

 Cleanliness & Hygiene campaigns launched in association with reputed NGO’s
 Facilitates Pollution watch information
 Safe drinking water to Earth Quake victims in Bhuj
 Aids to Cyclone victims in Andhra Pradesh
 Hosts various religious festivals

It does not matter in to what activity they are catering in to; ultimately they have created
a good will and an image of trust in the mind & hearts of the customers.

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Brief Interview with Mr. Sanjeev Sharma

Sanjeev Sharma is the branch manager of Eureka Forbes, Sector 2, Noida Branch. He
also handles the Sector 57 branch. He has been associated with EFL for the past ten
years. We are thankful to him to have had taken out some time aside to answer some
questions to aid this project report. He answered all the questions without a glitch even
though he was pressed for time because of a delivery schedule.

After a brief introduction about the project and the required information, this is how the
interview went:

Group 10: Sir, could you please throw some light on the history of Eureka Forbes
Limited?

Sanjeev: Eureka Forbes has been around for about a century now. The first product of
Eureka Forbes was a vacuum cleaner and was launched in the year 1909. Eureka Forbes
came to India in the year 1981 and began its operations in Delhi. We are almost at a 1000
crore turnover company and have an export turnover of about U.S. $382,000.

Group 10: Congratulations sir, for completing a hundred years. This must mean that you
have a huge customer base and an even bigger turnover.

Sanjeev: That’s right! We have a customer base of about 6 million. We have our
presence felt in about 131 cities and 398 towns in India. We have a total of 136 outlets. In
fact, we have 10 franchisees in NOIDA itself.

Group 10: In the web site, it was mentioned that Eureka Forbes deals with Water
Purifiers, Vacuum Cleaners, Air Purifiers and Security Solutions. Which one of these
products sells the most?

Sanjeev: Yes, we do deal in all the products mentioned. Out of these, the water purifiers
sell the most. In fact we have a dedicated customer base of about 40-50 lakhs in India.
Out of these, aquagaurd contributes to about 10 – 12 lakhs. We have established
Aquamall exclusively for our water purification systems. We are ISO 14000 and 9000
certified and last year we had a turn over of about 15.5 crores and a profit before tax of
about 1.8 crores in the segment.

Group 10: Could you let us know about your contact plans, how you collect and build
upon your database and what is your distribution channel?

Sanjeev: Well, Eureka Forbes has always been into direct sales and we intend to stay
with the same. As for our database, we already have a huge database, for more customers
we rely on references from our existing customers. We also tend to advertise and involve
in various camps such as school camps, park camps, doctor camps etc.

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Brief Interview with Mr. Sanjeev Sharma

Group 10: What exactly is a school or a doctor camp?

Sanjeev: Well, here our sales reps tend to focus on the particular segment in a particular
area. For example, if a sales person has been allocated a doctor camp in Noida, then he
has to go to all the doctors (and only doctors) present in the area and educate them about
our products.

Group 10: So, how do you get the information about all the doctors of a particular area?

Sanjeev: (laughs) Yellow Pages.

Group 10: What other promotional and advertising activities do you involve in?

Sanjeev: Well, we tend to advertise in all sorts of mediums, from print media to online
media to television advertising. You must have seen our friendly sales person ad or the
Smriti Irani ad, haven’t you?

Group 10: Yes sir, very much. So how many ads do you release in a year?

Sanjeev: Well, its very hard to please a customer, and it is even harder to retain an old
one. So to build an impression and to remain a trustworthy brand, we tend to release 1 - 2
ads each year. We also tend to focus on a friendly relationship with the customer and like
to be treated as a part of as a family, hence our ads are also oriented toward the same.
You might remember the ‘ussay kya hoga ad’?

Group 10: Yes sir, that was a very cute ad. So, have you had any converts because of the
ads?

Sanjeev: Yes, we get numerous calls on our 24 hour helpline. We are able to convert
most of them on the basis of a simple demonstration. After all, a customer would only
call for a demo is he or she is already convinced by the ad.

Group 10: Initially you said that you are in direct sales. Could you please tell how many
prospects receive a demo in a day and how many converts do you get out of them? Please
be specific about your water purifiers as they are on the hot list.

Sanjeev: According to the company policy, a sales person needs to give about 3 demos a
day. But, a sales person is only able to manage 30 – 40 demos in a month. The
conversion ratio is about 3:1.

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Brief Interview with Mr. Sanjeev Sharma

Group 10: Could you please throw some light on the sales force that you have in India
and in the Delhi region? Also, are you men oriented or you employee women as well?

Sanjeev: I estimate that we should be having a sales force of about 6000 + employees.
The Delhi region must have about 400 – 500 employees. Yes, we do employee women,
but as we have a lot of door to door selling and women avoid getting into the field, the
ratio is around 98:2.

Group 10: Could you also tell us about the margins that you have in a product?

Sanjeev: O no! I cannot do that. That is top class information. Next question please. (Our
research from the net says it is approximately 4 – 5%).

Group 10: Alright sir, could you at least tell us about your discount policies?

Sanjeev: We do not give any discounts until and unless there is a bulk sale. There also,
we only provide a discount upto 2 % and the minimum order should be of at least 11
products.

Group 10: What about the sales people?

Sanjeev: What about them?

Group 10: What is their share? Do they get any incentive?

Sanjeev: The sales people are paid according to the bracket they sell in. For example, if
they sell 8 units, they fall into the 180 slab and if they sell 12 units, they fall into the 220
slab. They get a bonus of Rs 50 per sale.

Group 10: Sir, you have launched many products in the water purifiers segment itself.
Could you please highlight the complaints that the customers generally face?

Sanjeev: Well, first of all, we upgrade from one product to another, not because there
were faults in the first one, but because we need to customize the product according to
the current requirements. We do not receive many complaints, but incase we do, we tend
to solve them within 24 hours. We believe in the concept of friends for life, hence we
wish to retain a customer, so we tend to sell the right product in the first instance. But, we
do have a return policy for dis-satisfied customers. We refund their full money incase
they wish to withdraw within a week of installation. We have never needed to resort to
this policy though.

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References

www.eurekaforbes.com

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