RURALMARKRTING PROJECT ON

CHICK SHAMPOO
SUBMITTED BY GAURAV SHARMA
MBA 2185106

CHIK SHAMPOO- RURAL MARKET

REVOLUTION

To understand Indian rural dynamics and Indian

rural consumer behaviour
To provide a backdrop of the Indian Shampoo
Market in the rural context
To highlight the successful strategies that Chick
Shampoo employed in the rural market

The concept of sachets

C K Ranganathan, CMD, CavinKare, has shown the
world it is possible to beat MNCs even in FMCGs
Born in Cuddalore in TN, started a business with Rs
15,000, now worth Rs 500 crore (Rs 5 billion)
“My father introduced the sachet concept as he
felt liquid can be packed well in sachets. When
talcum powder was sold in tin containers, he sold
it in 20/50/100 gm packs. When Epsom salt came
in 100 gm packs, he sold it in 5 gm sachets ”
“Whatever I make, I want the coolie
The concept of sachets

C K Ranganathan, CMD, CavinKare, has shown the

world it is possible to beat MNCs even in FMCGs
Born in Cuddalore in TN, started a business with Rs
15,000, now worth Rs 500 crore (Rs 5 billion)
“My father introduced the sachet concept as he
felt liquid can be packed well in sachets. When
talcum powder was sold in tin containers, he sold
it in 20/50/100 gm packs. When Epsom salt came
in 100 gm packs, he sold it in 5 gm sachets ”
“Whatever I make, I want the coolies and rickshaw
pullers to use. I want to make my products
affordable to them, he used to say”
“Sachets are going to be the product of the future,
he said. But my father was a great innovator, but a
poor marketer”

How Chik Shampoo was born

The family launched Velvette shampoo sachet

successfully in the South in the late 1970s
1982- Ranganathan joined, but separated over
differences with family members
Started Beauty Cosmetics, with Chik Shampoo
named after his father, Chinni Krishnan
Chik began with only 20,000 sachets, but made
profits from the second year
1989- Office in Chennai, manufacturing in
Cuddalore
Beauty Cosmetics name was restrictive
1998- in-house contest suggested CavinKare
Cavin in Tamil means beauty and grace, and C
and K (father's initials) spelt in capitals

CavinKare- pioneering attempt to offer shampoos

in small pillow packs
Market flooded with 70-odd small shampoo labels
with little differentiation
Velvette (family business), synonymous with
‘sachet shampoo’, aggressively marketed by
Godrej
Consumers would ask for a Velvette but walk away
happily with whatever label the retailer gave them
Many never knew the difference, for others it did
not matter

Target audience

Lower middle-class/
semi-rural (Sec B2,C,D)
MHHI Rs 1,500–3,000
Females
Age group of 16-plus

Accessibility & Affordability

The success of the sachet changed the structure of
the shampoo industry
New layers of consumers, mainly from rural
pockets, could now afford shampoos
The ‘upper class’ tag attached to shampoos fast
faded away
Extremely cut-throat market emerged
Significant trade influence on what the consumer
bought
Accessibility & Affordability

The success of the sachet changed the structure of

the shampoo industry
New layers of consumers, mainly from rural
pockets, could now afford shampoos
The ‘upper class’ tag attached to shampoos fast
faded away
Extremely cut-throat market emerged
Significant trade influence on what the consumer
bought

ChiCk Launch
1983- Chik shampoo launched by CavinKare
Initial launch in 10 ml pack
Later launched in sachet form
Market cluttered with low-cost shampoos
“But there was a clear opportunity for a good
quality shampoo with appealing perfume at a price
to delight the consumer”
Chik endeavoured to provide to the masses a
significantly superior product than those available
at similar price points
Chik shampoo used French perfume to
differentiate itself on the plank of superior
fragrance
Promotion
1-Ad strategy based on the powerful appeal of
cinema among common masses
2-Innovative radio ads based on popular cinema

Innovative radio ads based on popular cinema

dialogues, unlike plain radio jingles of competitors
“Cinema is the most cherished means of family
entertainment and cine stars have cult following in
the south. Therefore, the communication strategy
was to leverage popular cinema dialogues to drive
home the message”
3-Popular southern cine stars endorsed Chik-
Amala, Khushboo, Manorama and Charlie
4-Radio used as the sole mass advertising medium
Annual ad spends about Rs 2 lakh.

Taking on the MNCs

“MNCs sold products in bottles, not in sachets and

sold only from fancy stores. They did not look at
the small kirana stores, nor at the rural market”
“We went to rural areas in South India where
people hardly used shampoo. We showed them
how to use it by doing live demonstration on a
young boy. We asked people to feel & smell his
hair”
“Chik sponsored shows of Rajniknath's films. We
showed our ads in between, followed by live
demonstrations. We distributed free sachets
among the audience after every show, which
worked wonders in rural TN & AP.
After every show, our shampoo sales went up 3-4
times”

Rural ChiCk

“Chik’s value proposition helped us become No.1

in many states in rural India. Recruiting customers
is the key issue as the rural consumer is rational &
value conscious. To be successful, the marketing
mix must deliver superior value to the rural
consumer at a price point he is comfortable with”
The Chik Promise
A year round tropical climate makes it difficult to
maintain hair softness and shine
Tangled hair- Common complaint in girls & women
Softness & manageability- key issues in the
maintenance and nourishment of hair
Unique formula – Active Double Conditioners
“The iconic Chik Girl in every ad treated her hair
with the shampoo and demonstrated with utmost
ease and confidence, her ability to untangle her
hair with just a single motion of running her
fingers through her hair”

Range

Chik penetrated the Indian market

with a wide range, 4 refreshing
fragrances, sensistive pricing
and right sizing
Chik Black
Chik Jasmine
Chik Egg
Chik cool

EMPLOYS

2006-2007- CavinKare 500 crores

576 employees
All India network of 1300 Stockists catering to
about 25 lakh outlets nationally

Manufacturing plant at Haridwar (Uttaranchal)

Third Party manufacturing at Pondicherry, Noida,
Assam and Faridabad
Exports- Nepal, Srilanka, Malaysia, Singapore,
Bangladesh, US and the GCC region
Target- 1500 crore company by 2010
Reasons behind CavinKare’s success

“Teamwork is the main reason for our success.

We have good professionals who work really

hard. The second reason of our success is

innovation and thirdly we have executed

innovative ideas well”