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Case: Kurlon Ltd.

Submitted By: Group B6

Question 1 - What is the case situation?

The case situation:

Kurlon Ltd, a company established in 1962 which has decades of transformation to stay
relevant to their customers, is facing the dilemma of not understanding what’s causing the
recent drop in sales in the year 2002. The probable causes are:
1. Flaws in product design in terms of features and benefits
2. Changes in positioning strategy
3. Ineffective advertising
4. Wrong costing and pricing structure
5. Poor motivation to dealers
6. High number of variations under brand
7. Very strong regional competition
8. Most of the sales were from South India and foreign sales were stagnant

 The company came up with the innovative new rubberized coir mattress. This product
had many advantages over spring and cotton mattress. But despite being reasonably
priced rubberized coir mattress was mainly bought by high-income group. Also, the
contribution by institutional sales was significantly low at 10%.
 Kurlon offered the least margin to its dealers at 20%. Also the prices of the other brands
were lower by 10-20% than Kurlon mattresses.
 Kurlon has a very large product portfolio. It’s also one of the few brands with a national
presence and was rated highest in terms of Brand Name. But the extensive product line
actually backfired in certain cases due to customers not being able to decide which
product of Kurlon to buy and ultimately settling for a product from one of the local
 Kurlon was the leader in rubberized mattress. The other products like PU foam and spring
mattress had Sleepwell and Springwel as major competitors. These brands were giving a
tough competition to Kurlon because they had better schemes.

Need of the hour:

1. Increasing the dealer margin
2. Launching Spring and PU mattress for export
3. Kurlon retail stores(Which was implemented later)
4. Promotions across the lower and middle income group

Question 2 – Develop an appropriate framework to connect the customer segments with

the product portfolio of Kurlon

Kurlon is available in 5 different categories, which caters to various segments. Each segment
represents different purchasing behaviour based on their needs.
Classification of segments is explained in below flowchart:

Kurlon Customers

Domestic Buyers (New and Institutional Buyers

(Hospitality industry, healthcare
repeat buyers)



Outline of different segments is as under:
1) Economy buyers: This segment seems to be the largest in terms of sales revenue.
Price is the most important parameter and focus should be on economical
 Product brand: Apsara
 Price range: 1526/- to 4498/-
 Customer characteristic: Middle-upper and middle segment which is price
reactive. Unmarried customers fall under this category.
 Socioeconomic status (SEC): B1, B2, C
 Size (Thickness in inch): 3, 4

2) Premium buyers: This segment’s purchase behaviour is characterized by sense

of seeking quality, comfort and value for money.
 Product brand: Super deluxe, Klassic
 Price range: 1855/- to 7656/-
 Customer characteristic: Upper segment which prioritise to comfort and
cushioning. They have homogeneous preferences.
 Socioeconomic status (SEC): A1, A2, B1
 Size (Thickness in inch): 3, 4, 5

3) Variety seekers: This segment shows one-time purchase behaviour mostly.

 Product brand: Romantique
 Price range: 2755/- to 6659/-
 Customer characteristic: Upper segment which looks for style and
comfort. They are mainly newlyweds and young couples.
 Socioeconomic status (SEC): A1, A2, B1
 Size (Thickness in inch): 4.5

4) Institutional buyers: This segment represents mostly B2B buyers and mainly
they purchase single bed mattresses.
 Product brand: Ortho
 Price range: 2619/- to 6389/-
 Customer characteristic: Upper and Middle-upper segment which includes
customers having spinal and back problems. They are mainly old age
 Socioeconomic status (SEC): A1, A2, B1, B2
 Size (Thickness in inch): 4

Question 3 – Examine and critically analyse brand pull and push for Kurlon Ltd.

Brand push:
1. In 1987, Kurlon limited stopped its line of bare blocks business and concentrated on
finished mattresses. This was done to get their finished mattresses in the market by
capitalising on the goodwill of Kurlon.
2. For trade, the company offered promotion schemes like gifts, higher commissions on
achieving targets, awards, etc. This helped them in getting dealers and traders keeping
Kurlon products with them.
3. Kurlon offered approximately 94 verities under five sub segments. This was mainly done
to reach out to every segment of the market. “Apsara” was the economy model whereas
“Klassic” was the super-premium model.

Brand pull:
1. Kurlon advertised through newspapers, magazines, TV, outdoor and through brochures.
This strategy increased the brand awareness of Kurlon Ltd.
2. The advertising campaigns had themes like advanced centre densification (ACD),
comfort, greater back support, doctor’s advice, emotional wedding gift, reliability etc.
the campaigns portrayed a healthy and reliable nature of Kurlon Ltd. The advertisements
were considered as a very good source of information.
3. In the year 2001, the company changed the theme to “pure sleep – nothing else” from
“India’s largest selling mattress”. The strategy was to project sleep as something very
basic and sublime as well as highlight the importance of a pure undisturbed sleep by
using the Kurlon mattress.
4. For customers, Kurlon had sales promotion schemes like gifts, coupons, season
discounts, exchange schemes, slogan writing contests etc.
5. The company had a huge budget for sales promotion (Rs 13.30 million in sales

 Kurlon has an advantage of high awareness compared to its competitors. It provides so
varied products that the buyers get confused between them and end up in buying
product of another brand. (Mentioned by customers).
 From Exhibit 11, Kurlon is only evaluated the highest in Brand Name while its
evaluated as the lowest in sales promotion schemes. This is maybe because of the lack
of differentiated marketing by Kurlon for its different mattresses.
 Kurlon Ltd was not much into dealer promotions and has one of the lowest dealer
margins which made it difficult to “push” their product.
 Store owners were also not “pushing” Kurlon’s product well.

 Dealer margins should be increased as they play a vital role in the push of the product.
 Differentiated marketing for various products will help in customer awareness about
the products and there will be less confusion during purchasing.
 The value delivered by each product should be efficiently communicated to the
 Allocation of more budget for the promotions and marketing and producing more
informative brochures.