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History of Hindustan Unilever Ltd.

Hindustan Unilever Limited (HUL) is India's largest fast moving consumer
goods company, with leadership in Home & Personal Care Products and
Foods & Beverages. HUL's brands, spread across 20 distinct consumer
categories, touch the lives of two out of three Indians. They endow the
company with a scale of combined volumes of about 4 million tonnes and
sales of Rs.13,718 crores.

The mission that inspires HUL's over 15,000 employees is to "add vitality to
life". With 35 Power Brands, HUL meets everyday needs for nutrition,
hygiene, and personal care with brands that help people feel good, look good
and get more out of life.

It is a mission HUL shares with its parent company, Unilever, which holds
52.10% of the equity. A Fortune 500 transnational, Unilever sells Foods and
Home and Personal Care brands in about 100 countries worldwide.

Hindustan Unilever Limited. Product Mix

Product-mix Width
Soaps Laundry Beverages Oral Care Foods
Dove Surf Excel Brooke Bond Bru Close-Up Kisan
Liril Rin Brooke Bond Pepsodent Annapurna
Product- Lux Wheel Lipton Knorr
Line Pears
Length Rexona
Lifebuoy
Hamam
Breeze

Hair Care Deodrants Skin Care Cosmetics Ayurvedic

Sunsilk Axe Fair N Lovely Lakme Aayush
Product- Naturals
Line Clinic Rexona Ponds
Length Denim Vaseline
Aviance
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Toothpaste Industry in India

• The Indian toothpaste industry is worth 2500 crores.

• India is still a nascent country in dental hygiene, with the majority of

the population still not having access to modern dental care but relying
on substances like coal ash and neem sticks.
• The toothpaste industry in India is growing at a steady state. About 50
% of India's population uses toothpastes, 27 % uses toothpowder while
23% in the rural areas are yet to adopt oral care.

• Mouth freshening washes, dental floss and teeth whitening products

are at a primary stage in India.

• Industry sources expect an increase in penetration level of oral care

products to 70% from current level of around 49% because of increase
in advertising campaigns and awareness.

• Colgate-Palmolive is the market leader in oral care segment. Colgate

and HLL together account for 85% of organized toothpaste market.

• The per-capita consumption of tooth paste is very low in India.

Per capita consumption in Gms

India 74
Europe 300
Thailand 150
Malaysia 350
Vietnam 300
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• Given the low per capita consumption and penetration rates,

toothpaste demand is mainly being driven by the overall market
growth of 8-10%.

• About 60% of toothpastes are sold on family platform; around 35% is

sold on cosmetic propositions.

• With the huge consumer base waiting to be tapped and the expected
rise in purchasing power as the economy picks up, oral hygiene in India
may receive a fresh lease of life.

Main Players & Their Market Shares

For any product to improve and serve the people better, good competitors
are of immense importance.

Little wonder that teeth were bared between the market leader, Colgate
Palmolive, and the challenger, Hindustan Lever, as the marketing war
between the two FMCG giants for protecting market share got tough.

As if that was not enough, these players found new aggressive competition
coming their way from regional low priced competitors such as Anchor
Healthcare & Ajanta India, who priced their offerings at over 40% discount,
giving market leaders a run for their money

The following are the main players in the toothpaste market of India:

Colgate – The market leader

o Been in the domestic oral care industry since the last 70 years
and enjoys strong brand equity in the market.

o Currently occupies a 48% market share in the domestic market

of India.

o Brand Portfolio of Colgate in toothpaste:

1. Colgate Dental Cream 6. Colgate Active Salt

2. Colgate Fresh Energy Gel 7. Colgate Max Fresh
3. Colgate Cibaca 8. Colgate Total
4. Colgate Herbal 9. Colgate Advanced
Whitening
5. Colgate Kids Toothpaste
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HLL – The Challenger

o Been in the domestic oral care industry since the last 33 years
and came up in 1980 with the innovative novelty element of gel
in toothpaste to make steady inroads in Colgate’s dominance in
oral care market, making it the 2nd largest paste brand.

o HLL has a market share of 30%, including Close-Up and

Pepsodent.

o Close-Up - addresses the youth with new benefits and value-

driven propositions.

Pepsodent – Family and oral health.

o Brand Portfolio of HLL in toothpaste:

Close-Up
1. Close-up Active Gel (red)
with Vitamin Fluoride System
2. Close-up Lemon Mint
Pepsodent
1. Pepsodent Cum Care
2. Pepsodent 2 in 1
3. Pepsodent Complete 10
4. Pepsodent Whitening

3. Close-up Milk Calcium

Dabur – Growth by acquisitions

o The Dabur group has managed to grab a 7.2% market share by
acquiring Balsara’s oral care brands: Babool, Promise and
Meswak, which were small but significant players in the 2400cr
toothpaste market of India, in addition to its own brand Dabur
Red. It was mainly targeted to capture consumers shifting from
toothpowder to toothpaste.

Anchor toothpaste & Ajanta toothpaste

o It was launched by a Mumbai based manufacturer & it is mainly
marketed as ‘Pure Vegetarian’ toothpaste because of which it
was able to grab 4% of the market share in a very short span of
time. This sudden growth was also because of the aggressive
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promotion strategies used like giving a toothbrush free with

toothpaste. Earlier it was mainly in the western region of India
only.

o Moreover, Anchor and Ajanta also offered their products at a

price less than 405 of the competitors which helped them
penetrate in the toothpaste market and give the big players like
Colgate and HLL, a run for their money.

Close-Up grew 20.9% by value, Pepsodent grew only 2.8% while rival Colgate
grew 16.4% during the period. Babool grew by 54%.

4 P’s – Product, Price, Promotion and Place

PRODUCT
Quality:
Close-up gel is the toothpaste for a super fresh mouth and shiny white
teeth.

Product Variety:
1) Close-Up milk calcium: It is a new toothpaste which bring the revolution in
the close up sales. It contains the goodness of milk calcium which is
completely new thing, with white milk calcium nutrient on the inside and a
refreshing blue gel on the outside.

2) Close-Up active gel: It contains vitamin fluoride and gives three benefits of
stronger teeth, whiter teeth and fresh breath.

3) Close-Up lemon mint: Its major emphasis is on cleanliness of teeth. This

was adapted to Indian taste and it uses same positioning of fresh breath and
white teeth.

Brand Name : Close Up – The Closer, the Better

Everyone knows that being close is a fundamental human need. Each Close
Up product, gives an individual the social confidence that one needs to get
closer to others.

Features:
There are following features provided by Close Up:-
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1) Vitamin Fluoride System: - Gives stronger teeth.

2) Mouthwash: - Gives fresher breath.
3) Micro Whiteners: - Remove yellow for shiny white teeth.

Product:
The Company has also upgraded the carton and tube packaging of the
product so as to change the look and feel of the brand. The picture of a
young couple which was earlier printed on the carton has now also been
embossed on the laminated tube. This is to emphasize on the USP of the
youth brand as one which delivers fresh breath that lasts longer.

PRICE

List price: 61 Rs. for 150 gm.

List price: 48 Rs. for Close Up active gel

The product is in the popular segment which is priced higher to only the
economy segment and lowers than the gel and premium segments in the
toothpaste market.

PROMOTION

Sales Promotion:
The product is placed at just below eye-level at the stores surveyed. Place
near payment counter is preferred by keeping in mind that it can promote
the sales.

Advertising:
1) Close Up ad jingle “Kya aap Close Up karte hai?”
has promoted its sales on a larger scale.

2) Internet is probably the only medium with the fastest turnaround time
in terms of break through innovations. Starters, if one logged on to the
Yahoo! India, Sify or India times portals, one founds a stunning in-your-
face red page branded by the new Close Up. The home pages of these
three websites were totally branded by the splashy new Close Up.
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3) Close Up has also tied up with AXN's Alias. The connection: Just like the protagonist
in Alias - Jennifer Garner - changes her identity time and again to tackle different
situations, the tie up with it signifies that Close Up too has changed now and is in a
brand new avatar! AXN assistant VP marketing and sales Rohit Bhandari said, "The basic
essence of branding Close Up with Alias was to bring out the element of change that
Close Up has gone through and also to match the change of identities that Garner goes
through in Alias."

4) Close-Up Toothpaste - Mouth to Mouth Certified - Ad Campaign Promotional - T-

shirt.

Public Relations:
The most important ways in which Unilever makes a contribution is by
enhancing public relations. Some of the examples are:-

• Enhancing the health and well-being of consumers through its products

and brands.e.g HLL has been slowly trying to re-position Close Up by
introducing more of oral health benefits than simply `fresh
breath and white teeth' kind of cosmetic positioning.
• Addressing the sustainability challenges related to climate change,
water, packaging and sourcing of agricultural raw materials.
• Creating wealth in the communities where they operate and bringing
benefits to their stakeholders.
• Introduced new marketing guidelines limiting advertising to children
under 12 and banning the use of 'size-zero' models.
• Launched new climate change strategy with target to reduce CO2;
from energy in manufacturing by 25% by 2012.
• Named Wal-Mart's Supplier of the Year for Sustainable Engagement.

PLACE

Channel:
The product is sold in retail outlets like Kirana stores, supermarkets, medical
shops etc. It is distributed through the supply chain of company distributor to
wholesaler to retailer to final consumers.

Coverage:
HINDUSTAN Lever Ltd (HLL) is rejigging its oral care portfolio to arrive at a
50:50 sales turnover ratio between its rural and urban sales for its two
toothpaste brands, Close up and Pepsodent. After removing Aim from its
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portfolio recently, the FMCG major plans to put all its additional resources
behind its two power brands to divide its sales turnover equally between the
urban and the rural markets.

The product is available in the all-India market, including semi-urban and

rural markets which are their primary focus.

Location:
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 Present Products New Products

I. Market
10Product SurveyPenetration
on Close- (Intensive III. Product Development
UpGrowth) (Intensive)

1. Attract users of competitors 1. Product reformulation

products strategy
o Close-Up tried to attract its o Close-Up added many new
nearest competitors’(Colgate) ingredients in their toothpaste to
customers by introducing several improve the freshness of breath,
variants like Tingly Red, Eucalyptus whitening of teeth, the strength of
P
Waves and Close-Up Whitening, teeth, etc(E.g.: Close-Up Lemon
r
e Close Up Milk Calcium Nutrient and Mint, Close Up Milk Calcium
s Lemon Mint Nutrient)
e o Pepsodent has introduced a
n tooth gel with mouthwash added in
t it
M 2. Convert nonusers into users 2. Product quality
a o Close-up tries to attract the improvement strategy
r customers from the rural market by o Close-Up tried to bring about
k making them aware of the functional preferences by adding
e importance of personal hygiene. enamel strengthening fluoride in
t The penetration levels of the rural their toothpaste.
toothpaste market is only 30
percent providing a gaping scope
for improvement as compared to
the urban market penetration of 70
percent.
3. Increase the frequency of 3. Product line extension
purchase strategy
o When the toothpaste is used o HUL has several product-lines
twice a day, the frequency of like toothpastes, detergents,
purchase of the product is bound to beverages, bathing soaps etc.
increase.
II. Market Development IV. Diversification
(Intensive)

1. Expand geographically 1. Related

N Close-Up is trying to expand to new
e geographical areas, especially in the
w rural markets
M 2. Target new segments
a Close-Up targets new segments of
r the market like the old age
k population, who need more calcium
e rich ingredients in their
t toothpaste(E.g.: Close Up Milk
Calcium Nutrient)
Hindustan Unilever has entered the
kids segment in the toothpaste
category under a new sub-brand —
Pepsodent Kids.
HUL has already ventured into
other personal care product
category including hair care, skin
care, deodorants etc.
2. Unrelated
HUL has diversified in unrelated
areas also, like the detergent
industry (Surf brand) and also food
industry (Knorr soups)
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Ansoff’s Model for Close-Up