ASIAN PAINTS

MARKETING MANAGEMENT
MARKET RESEARCH AND SURVEY
By Harshini Patel

10

INTRODUCTION
Paint Industry origin and growth:The history of Indian paint industry starts from Calcutta in 1902 when Shalimar Paints, Color & Varnish Company, A Pinchin Johnson unit, was established. Mounting industrialization and infrastructure helped the industry to grow higher. But, the imports from Britain made it harder for the industry to emerge and raw materials were not easily available. This one lone unit industry grabbed the opportunity in World War 2 to flourish. With the stoppage of imports owing to war conditions, the domestic market at last became almost the exclusive reserve of the domestic industry. European manufacturers, thus far exporting to India, readily saw the advantages of setting up manufacturing facilities here. The period between the wars thus saw the greatest ever influx of foreign paint companies into India- Goodlass Wall (1918), Elphant Oil Mills (1917) in Bombay, and British Paints, Jenson & Nicholson and Macfarlances in Calcutta. Macfarlanes was brought over by the Poddars and became a completely Indian company, while the other three: Shalimar Paints (Pinchin Johnson), British Paints and Jenson Nicholson continued as British operated units. Discussing about the development of paint industry after independence, we must not forget Asian Paints- a completely Indian unit which started on a very small scale. It grew so big by leaps and bounds over the years that it is today not only the largest unit in India but way ahead of the second largest, Kansai (Goodlass) Nerolac Paints Ltd., formerly a unit of Goodlass Wall (UK). It was not only Asian Paints but also other numerous factories with mediocre technological support were well established and working in Calcutta, Kanpur and Bombay wholly under Indian ownership The British

units, though a few in number, were technically strong and financially sound and, with the active support and patronage of the Government, controlled a vastly higher share of the market. The post independence period witnessed a steady growth in the paint industry. From a mere Rs.200 million turnover in 1950, the paint industry crossed the Rs.14000 million mark in 1990-91. The paint industry today is a Rs. 49 Billion Sector.

Paint Industry

Product

Sector

Industrial 30%

Decorative 70%

Organized 70%

Unorganized 30%

The Paint industry in India is widely divided into sectors as above from which 70% is organized sector.

The major players of this industry are as follows:-

Shalimar Jenson and Nicholson ICI Berger Paints Kansai Nerolac Others Asian Paints

6% 6% 8% 11% 13% 19% 37%

This readily proves that Asian Paints is the king of paint industry The leader in the high volume medium and mass segments of decorative paints, Asian Paints has been consolidating its market leadership over the last six years and now has the biggest slice of 37 per cent of the market for decorative paints in the organized sector as shown in the table above. Than comes Goodlass Nerolac and Berger Paints with market shares of 13 per cent and 11 per cent respectively. Other major players from the organized sector include Jenson & Nicholson with a low 6 per cent and ICI with 8 per cent.

SWOT ANALYSIS OF THE INDUSTRY:-

STRENGTHS:Imp of brand image as barriers to new entrants Good technology backup

WEAKNESS:Raw materials scarcity Requirement of high working capital Real estate in a depression phase.

OPPORTUNITIES:Fiscal incentives provided by Government. Commodity to FMCG Rise in disposable income

THREATS:Foreign companies entering as sole players

(Asian Paints mascot, Gattu, the mischievous kid)

THE ASIAN PAINTS SAGA:ASIAN OIL & PAINTS COMPANY. Asian paints were started in 1942 by Champaklal choksey, Chimanlal choksey, Suryakant Dani and Arvind Vakil-four entrepreneurs. It touched the sky by reaching the turnover of 3.5 lacs within 3 Years. Asian Paints is Indias largest paint company and the third largest paint company all over Asia today. It has also become 10th largest decorative paint company in the world. It is present in 22 countries with 27 manufacturing locations.

It bought:y y y Taubmans Paints (Fiji) In September 2003, ICI Indias Unit (February 2007). Sells stake in Australian Unit (June 2007).

Vision of the company: - Asian Paints aims to become one of the top five Decorative coatings companies world-wide by leveraging its expertise in the higher growth emerging markets.

Asian Paints is a great marketing success in a branded consumer product business. The company succeeded where others failed in three areas: First, It was the first to introduce small pack sizes, a variety of shades and a wide range of paint types (enamels, distempers, emulsions) to suit different pockets. Thus, in the sixties, the company came out with plaster distemper, Tractor, to suit the needs of the mass market for a product that was much cheaper than costly emulsions but much better than the widely used whitewash and crude powder distempers. This opened up a huge market and today distemper accounts for 25% of the decoratives market in volumes and 15% in value. And as recently as in 1992, the company introduced a synthetic distemper, branded Utsav, aimed at the same rural and low income urban markets. Secondly, in the highly competitive market emulsions segment, the company introduced as many as 151 shades in its Apcolite range when the competition was offering a maximum of 40 odd shades. The strategy paid off and Asian Paints today commands a 40% share in this segment. It set up an extensive national distribution network to tap demand in smaller towns. Today it has direct dealers in 3,200 towns and 10,000 stockists. Investments were also made in computer technology to ensure up-to-date information interface between the marketing and production sides of the business.

And finally, the company has displayed considerable savvy in its advertising campaigns, dealer relations, point of sale publicity and product demonstrations to consolidate and expand markets. In fact, the company has played a pioneering role in expanding the Indian paints market by identifying high demand potential areas and then tapping them to maximum effect.

PRODUCT RANGE OF THE COMPANY:Asian Paints provides wide range of products to the consumers like:-

 Ancillaries, this includes wall primers, wood primers, wall putty, metal primer, redoxide oil primer, knifing paste filler, thinner, Royal play tools, exterior sealer and floor color.

 Automotive applicants

 Decorative Paints, this includes paints for exterior walls, interior walls:- (distempers, Emulsions) , metal surfaces and wood surfaces:- (Clear finish, opaque finish, enamels).

 Industrial, this includes protective coatings, floor coatings, road markings, powder markings.

COMPETITIORS OF THE COMPANY:Asian paint doesnt really face much competition. As it is more than twice the size of its nearest competitor which is Kansai Nerolac Then comes,     Akzo Nobel Berger Paints Shalimar Paints Jenson Nicholson

CONSUMER BEHAVIOUR Consumers consume things of daily use; we also consume and buy products according to our needs, preferences and buying power. These can be consumable goods, durable goods, special goods or industrial goods. The market tries to understand the needs of different consumers as different consumers have different needs based on their preferences, beliefs, perception etc. Consumer behaviour is the decision making process and physical activity involved in acquiring, evaluating, using and disposing of goods and services.

REPORT ON CONSUMER BEHAVIOUR FOR ASIAN PAINTS:Asian paints have always been known as a valued brand and have created a trust among its customers throughout its life. It has very well used the concept of 4ps of marketing that areproduct, price, promotion and place.

Price

Promotion

Product
Marketing Mix

Place

 Asian Paints rightly introduced variety of products and branded almost all of them which fascinated the customers.  It was firm in offering value for money. It sold oil based distemper qt Rs. 26/- per kg which was easily viable for price conscious customer.  Gattu, the mascot of Asian paints and other promotional activities like undertaking demonstration campaigns helped them create strong customer awareness and also a new service provided by them online for knowing rates of painting their house and choosing right colors

also is a reason for brand popularity and inclination of customers towards their brand.  It did launch of its brands keeping in mind regional festivals and other regional (Place) influences.

Influences On Consumer Behaviour:-

It introduced wide range of products affordable to all classes of people like: Utsav for rural (chunna and distemper)  Distemper for middle income group  Royal for higher income group Due to this range all income group people could use Asian paints and that gave them a sense of pride and equality also the lower income groups urge for status was fulfilled. Asian Paints width of product line and market segmentation like industrial, automotive etc gives them a wide scope of penetration into different markets as customer are already aware of the brand and they can easily except it in other sectors also.

Buyers attitude, Preferences and performance:Buyers had a perception about Asian paints that it is a reliable and economically feasible product due to its past record and brand name so they prefer to chose Asian paint instead of any other paint. Consumer also had brand belief in case of Asian paints as it is existing since independence and also has maintained its brand name and gained popularity all over the world and satisfies consumers of all income level. It provided faster customer acquisition and paint by yourself concept which attracted maximum of Indian consumers also focus on special festival launches also helped it gain popularity.

Asian paints has targeted and positioned itself strongly in the market and their rigorous advertisements and easy availability has made it easy for the consumer to buy it.

BRAND LOYALTY AND PERSONAL OPINION:I would always use Asian paints as I have had a nice experience using asian paints and also is available in affordable ranges. Deepenti Lalwani, an MBA student says, she uses asian paints because of their customer services like various textures and its sample patching demonstration and a variety of shades available. She would never switch the brand as she gets value for money

Geetika Gupta, another MBA student says she uses asian ROYALE range to paint her house because its been a trend of the family of using asian paints and as it updates its products and shades with the span of time, trend is not an issue. If given a chance, she would also not shift the brand as she is contended with the quality, price and trend at the available price. Like these students, many other customers prefer ASIAN PAINTS due to:y y y y y Easy Availability Awareness due to advertisements Variety Cultural influence & Affordability