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Tanya Sinha PROV/E/59
INTRODUCTION
Dabur India Limited is a leading Indian consumer goods company with interests in Hair Care, Oral Care, Health Care, Skin Care, Home Care and Foods. From its humble beginnings in the by lanes of Calcutta way back in 1884 as an Ayurvedic medicines company, Dabur India Ltd has come a long way today to become a leading consumer products manufacturer in India .For the past 125 years, they have been dedicated in providing nature-based solutions for a healthy and holistic lifestyle. Through there comprehensive range of products, they touch the lives of all consumers, in all age groups, across all social boundaries. And this legacy has helped them develop a bond of trust with their consumers. That guarantees you the best in all products carrying the Dabur name. Dabur India Limited is the fourth largest FMCG Company in India. It is the first Company to provide health care through scientifically tested and automated production of formulations based on India traditional science. The company`s other products include anti allergic & anticancer drugs and guar gum. It is most famous for Dabur Chyawanprash and Hajmola. It exports primarily to the Middle East through Redrock. Currently, the company has nine production facilities organized around three main factories at Baddi (Himachal Pradesh), Uttaranchal and Nepal and six support factories at Sahibabad (Uttar Pradesh), Jammu, Alwar, Katni, Narendrapur and Jaipur. Currently the capacities for hair oils, oral care products, chywanprash, hajmola and asvarishta stand at 20,000 tonnes, 7,200 tonnes, 22,000 tonnes, 6,000 tonnes and 12,000 tonnes respectively. The company is engaged in trading of a sizeable proportion of hair oils, oral care products, hajmola and others. DIFFERENT PRODUCTS OF DABUR Foods Real Real Active Hommade Lemoneez Capsico Shankha Pushpi Sarbyna Strong Personal CareHair Care Oil Amla Hair Oil Amla Lite Hair Oil Vatika Hair Oil Anmol Sarson Amla Hair Care Shampoo Anmol Silky Black Shampoo
Vatika Henna Conditioning Shampoo Vatika Antidandruff Shampo Anmol natural line shampoo Oral Care Dabur Red Gel Dabur Red Toothpaste Babool Toothpaste Dabur Lal Dant Manjan Dabur Binaca Toothbrush
SWOT ANALYSIS
STRENGTHS Strong presence in well defined niches(like value added Hair Oil and Ayurvedaspecialties) Core knowledge of Ayurveda ascompetitive advantage Strong Brand Image Product Development Strength Strong Distribution Network Extensive Supply Chain IT Initiatives R & D a key strength
WEAKNESS Seasonal Demand( like chyawanprashin winter and Vatika not in winter) Low Penetration(Chyawanprash) High price(Vatika) Limited differentiation (Vatika) Unbranded players account for the 2/3 Rd of the total market(Vatika)
OPPORTUNITIES Untapped Market(Chyawanprash) Market Development Export opportunities. Innovation Increasing income level of the middleclass Creating additional consumption pattern
THREATS Existing Competition( like Himani, baidyanath and Zandu for Dabur Chyawanprash and Marico,Keo Karpin,HLL and Bajaj for Vatika Hair Oil) New Entrants Threat from substitutes (like Bryllcream for Vatika hair oil)
Transportation and infrastructure development in rural areas help in distribution network Tax exemption in exise duty Restriction in import policies. Help for agricultural sector.
ECONOMIC
Increasing GDP. Inflation rate: -1.27 Increase in disposable income. DABUR Recorded 16% Sales Growth in Last Fiscal
DABUR is the 5th largest sector of FMCG Companies with market size of more than 60,000 crore.
SOCIAL
The Indian culture, social& life styles are changing drastically. Indian consumer of today is clearly seeking healthier alternatives. Consumer buying behavior is changing. Social mobility
TECHNOLOGICAL
Technology has been simplified and available in the industry . Foreign players helps in high technological development. Rate of obsolescence. Government providing thrust on R&D. Internet IT
STARS stars are leaders in Business. High growth, High market share. Effort should be made to hold the market share otherwise the star will becomea CASH COW. Analysis with DABUR INDIAIBD(29.4%) GROWTH RATE ANALYSIS WITH CCDDABUR GLUCOSE-32%(GROWTH RATE) DABUR HONEY-26%(GROWTH RATE) MESWAK-39%(GROWTH RATE)
QUESTION MARK Most businesses start of as question marks. They will absorb great amounts of cash if the market share remainsunchanged, (low) Investments should be high for question marks. Analysis with DABUR INDIADazzl Chyawan Prakash
CASH COWS They are foundation of the company and often thestars of yesterday. They extract the profits by investing as little cash aspossible. They are located in an industry that is mature, notgrowing or declining. Analysis With DABUR INDIA%(GROWTH RATE) CHYAWAN PRASH HAJMOLA REAL
DOGS Dogs are the cash traps. Dogs do not have potential to bring inmuch return. Number of dogs in the company should beminimized. Business is situated at a declining stage. ANALYSIS WITH DABURCCD CHD-0.6%GROWTH
High
Market growth
low
STAR Question mark Chyawanprash Amla Dazzle vatika Chyawan prakash hajmola real fem honey glucose Cash Cow DOG Gulabari Dazzle Dabur uveda Odopic Odonil Lemoneez Babool Burst Meswak Dabur laltoothpowder &past Market share low
high
Top 10 FMCG companies 1. Hindustan Unilever Ltd. 2. ITC (Indian Tobacco Company) 3. Nestl India 4. GCMMF (AMUL) 5. Dabur India 6. Asian Paints (India) 7. Cadbury India 8. Britannia Industries 9. Procter & Gamble Hygiene and Health Care 10. Marico Industries
Through this list we can analyze that the main competitors of DABUR are HUL, ITC, NESTLE & GCMMF(AMUL). By analyzing this list we can also come to a conclusion that in FMCG sector HUL is the MARKET LEADER. DABUR,GCMMF(AMUL), ASIAN PAINTS & CADBURY comes under the CHALLENGER group because they have companies leading them. But DABUR CHYAWANPRASH is the MARKET LEADER.It is the highest selling ayurvedic medicine with 65% market share. DABUR HONEY is also a MARKET LEADER in branded honey market. It has around 75 % market share. HAJMOLA Tablets are also in command with 60% market share.2.5 crore HAJMOLA tablets are consumed in India every day.
MARKETING MIX
we shall be discussing the 4 Ps of marketing mix with respect to Dabur. The mix shall be analyzed as followed: Product Price Place Promotion PRODUCT: Products have been divided into 5 power brands
Quality: High Sizes: Available in different sizes Design: Available in Tetra Pack, Bottles, Sachets
PRICE: As, Dabur had different sub-categories it came out with variable pricing to reach each and every target segment E.g. : One- litre bottle of Cooler (juice) was priced at Rs.50 Selective Price Reduction to increase Demand Introduction of Smaller packs at Rs.5 Came out with Rs.1 sachet of Vatika Shampoo to increase market share Cutting Price to stand out against competition PLACE :
Dabur constantly kept on increasing its geographic spread to increase its sales revenues Entered the South Indian Market Expanding in the International Market Presence in over 50 countries Subsidiaries established in Nepal, Nigeria, Bangladesh and Pakistan Focus areas : Asia Pacific, Afghanistan, Russia and other CIS countries PROMOTIONS :
Different brands have its own marketing and advertising team Different brands had different promotions Utilized the popularity of Indian films in the domestic and global markets to promote its brands Undertook the most advertising campaign with Mr. Bachchan endorsing Dabur brands Signed cricketer Virendar Sehwag and his wife for selected Oral, Hair and Healthcare products Adopted the INTEGRATED MARKETING COMMUNICATION programme in 2003 to increase its market share Targeted the Institutional market which included hotels and airlines Partnered with Institutional clients to provide value added services Held various contests Training sessions and workshops for food and beverage professionals Tie-up with Discovery Channel
DIFFERENTIATION STRATEGY
DABUR has maintain a clear DIFFERENTIATION Strategy in TOOTHPASTE segment by its product Dabur lal Dant manjan. It is a pure ayurvedic product with
ingredients like Lavang KaTail, Kaali mirchi , Pudina Satva , Pippali, , unthi, Karpoor &Tomar seed, Sugandhi Dravaya, Kasni, Gairic powder, Othernatural ingredients. No other brand able to produce such kind of toothpaste, so it is clearly a differentiation strategy of DABUR.
Informational complexity and asymmetry Fixed cost allocation per value added Level of advertising expense Economies of scale Sustainable competitive advantage through improvisations The bargaining power of customers: Also described as the market of outputs. The ability of customers to put the firm under pressure and it also affects the customer's sensitivity to price changes.
Buyer concentration to firm concentration ratio Degree of dependency upon existing channels of distribution Bargaining leverage, particularly in industries with high fixed costs Buyer volume Buyers Switching cost relative to firm switching costs Buyer information availability Availability of existing substitute products Buyer price sensitivity Differential advantage (uniqueness) of industry products RFM Analysis Bargaining powers of buyers have increased dramatically with the advent of Globalisation. With increased presenc entioned previously, suppliers have got wide range of choices. So Dabur India has to formulate strategy in such a manner to keep abreast with the increasing competition by improving the quality and reducing the prices over the period.
The bargaining power of suppliers: Also described as market of inputs. Suppliers of raw materials, components, labor, and services (such as expertise) to the firm can be a source of power over the firm. Suppliers may refuse to work with the firm, or e.g. charge excessively high prices for unique resources. Supplier switching costs relative to firm switching costs Degree of differentiation of inputs Presence of substitute inputs
Supplier concentration to firm concentration ratio Employee solidarity (e.g. labor unions) Threat of forward integration by suppliers relative to the threat of backward integration by firms Cost of inputs relative to selling price of the product. Due to its over 100 years presence Dabur does have a very strong bond with the suppliers. Also Dabur does follow the policy of having good relations with all the peoples with which it deals. This helps in having a good relation with the suppliers. Also the policy of being accountable to stakeholders be its customers, without whom it will not be in business, shareholders, who have an important stake in our business and the employees, suppliers who have a vested interest in making it all happen- are their stakeholders.
RECOMMENDATIONS
The company needs to provide a better quality toothpowder at reasonable price to increase sales. The rural consumer usually uses neem and datun. Here Dabur has an advantage as all its products are Ayurvedic in nature In order to compete with the existing brand, the company should provide the consumer with various skus - 25gm, 50gm, 100gm and 300gm. And specially the 1 Rs sachets to initially induce the consumer to use. Consumer preference needs to be assessed regularly because of fluctuating preferences. A company representative should pay a regular visit to the market and ask the retailers for any change in preferences of their regular customers. In order to launch product it the wtp segment Dabur has to launch the product at a lower price or with value propositions and price at par with Colgate. Retailers complain of irregularity in taking of orders and non-delivery of goods on time by the distributors, as a result of which stock is not available at the outlet, resulting in loss of customers. Company should look into the matter of this ignorance in part of the distributors. Focus on national branding Work on new products Should give E-purchasing facility