Hindustan Levers Project Shakti

- Marketing FMCG to the Rural Consumers

Submitted By:
Group 10
pgp27212 Dimple Bhatia
pgp27214 Debjit Roy
pgp27250 Seemant Singh
pgp27236 Prasoon Kumar
pgp27205 Anup Abhipsit
pgp27246 Rohit Kumar Gangwar
Unilever in India
Competitive Advantages:
Strong, well-established brands
Local manufacturing capacity and supply chain
Vast and wide-reach distribution system

GSM
Personal
Products
GSM
Detergents
GSM
Beverages
GSM
Foods
Regional
Manager, RM
RSM
Foods
RSM
Beverages
RSM
Personal
Products
RSM Detergents
ASM4
Detergents
ASM3
Detergents
ASM2
Detergents
ASM1
Detergents
Sales
Officer 3
Sales
Officer 2
Sales
Officer 1
Redistribution Stockists (Rses): 6 to 10 per TSI
Territory Sales In-charge (TSIs): 5 to 7 per Sales Officer
Sales Organization based on Product Categories and Geographies

- The Redistribution Stockists (RSes) received stocks from company owned
depots or CFAs and sold to wholesalers and retailers
- Each profit center had its own sales force and stockists
Need for Change:

- Not appropriate for small markets
- Expensive to maintain individual stockists for different profit centers
Urban Market Challenge
- Increased competition in urban markets due to entry of numerous players
- Ineffective current S&D structure to tackle Modern Urban Trade characterized
by large retail chains
- Combined negotiation required for such chains



Approach to Rural Market Based on
Business Potential and Accessibility
Indirect
Coverage
(IDC)
Direct
Coverage
Space for
Project
Shakti
Streamline
Low Business Potential High Business Potential
Accessible
Markets
Inaccessible
Markets
Direct Coverage:
Common Stockist to serve all
outlets
Indirect Coverage:
Common Stockist assigned a PJP
(Permanent Journey Plan)
Visit all rural retailers at least once
every fortnight
Streamline:
Wholesale channel
Appointed Rural Distributors (RDs)
who in turn appointed Star Sellers
Transfer of ownership

The above 3 approaches reached
about 30% of rural market, yet 70%
of the market remained untapped
Challenges and Opportunities for HLL
in Rural Market
Challenges
Scattered consumer markets
over large areas
Low per capita consumption rates
Poor connectivity through air, rail
and roads
Higher cost of accessing rural
market
Huge untapped potential
market(16% direct coverage of
rural market)
Access to new market to
compensate for stagnation in
urban markets
Source of competitive advantage
as the market is relatively
untouched by competitors
Opportunities
GSM
Personal
Products
GSM
Detergents
GSM
Beverages
GSM
Foods
Regional
Manager, RM
RSM
Foods
RSM
Beverages
RSM
Personal
Products
RSM
Detergents
ASM4
Detergents
ASM3
Detergents
ASM2
Detergents
ASM1
Detergents
Sales
Officer 3
Sales
Officer 2
Sales
Officer 1
Redistribution Stockists (Rses): 6 to 10 per TSI
Territory Sales In-charge (TSIs): 5 to 7 per Sales Officer
Project Shakti
To create income-generating capabilities for underprivileged rural women by
providing a small-scale enterprise opportunity, and to improve rural living
standards with greater awareness of health and hygiene


Project Shakti was launched as a platform to act as:
1. A Rural Market Sales and Distribution Initiative to deliver growth
2. A Communication Initiative to Build Brands
3. A micro-enterprise initiative that creates livelihoods in rural India
4. A Corporate Social Initiative that improves living standards and catalyzes
affluence in rural India

Objective
Business being shared
responsibility of the group
leading to group unity and
support
Women empowerment
Role of Shakti entrepreneurs as
influencers, impacting category
and brand awareness
Availability of quality products
in villages



Advantages of Project Shakti Model

Deep penetration in remote rural
market
Improved brand awareness for
HUL in media blind area
Goodwill generation for the
company

For Community
For Hindustan Unilever
Project Shakti Model
Self Help
Groups
Rural
Entrepreneur
Rural Sales
Promoter
Rural Retailers
and End
Consumers
HUL
Initiatives for Rural Entrepreneurs
Some discount relative to general trade
Opportunity to sell to retailers as well as directly to ends consumers
Fixed initial investment of Rs 10,000 to ensure monthly income of Rs 700 per
month
Additional 2% discount for star sellers
Additional 1% discount as they did not avail credit
Access to micro-credit
Grassroot innovations
Offering discounts from own margins to induce new customers and win them
over from local retail trade
Creating a network of friends and relatives in neighboring villages to sell the
products

Extend Project Shaktis Impact Beyond Sales & Distribution
Social Communication Program for Rural Brand Building
Corporate Social Initiative
Objective:
- Spread awareness of health and hygiene in rural India
- Secondary benefit of increased market for HULs health and hygiene products
- Social Communication program as a cost effective mode of brand promotion
Mode of Operation:
- Trained local woman equipped with aids such as pictorial literature and
interactive games positioned as an expert on hygiene
- Employ different social gatherings as platforms
- Ground implementation by Ogilvy Outreach
- Funding by strong internal brands and Project Shakti
- Programs extended beyond Shakti villages
Challenges:
- Insufficient internal budget Cooperation from Governments and NGOs reqd.
- Keeping the original objective of Vani intact while funded by brand promotion
budget


Shakti Vani
Extend benefits of Information and Technology to Rural India
Social Communication Program
Corporate Social Initiative

Objectives:
- Empowering rural community by creating access to information
- New communication channel for rural areas for brand building
Mode of Operation:
- Free access for registered rural users to wide range of information
- Dialogue-interactive software, updated with information daily from central
portal via dial-up internet connection
- Expert answers to queries when info not available in portal
Challenges:
- Limited CSR budget created obstacles for scalability and sustainability
- Unequal Internet Penetration across states
- Fast scalability required to achieve its objectives
Solution:
- Partnership with state owned e-governance ventures AP Online in Andhra
- Use of wireless mobile technology like GPRS for internet connectivity
(Suggested)

iShakti Rural Community Portal
Focus on growth of revenue per consumer as well as growth
of number of consumers out of Shakti target areas
Higher Growth targets to an individual target
Optimize the skill training programs for the Shakti
entrepreneurs
Start Shakti clubs for entrepreneurs in an area
Use local gatherings as promotions possibilities (e.g. Gifts to
newlyweds from HUL product line, free samples, etc.)
Ensure support of NGOs, banks and both state and local
government for smooth functioning of programme





Recommendations
By2009 the program had more than 45,000 entrepreneurs covering approximately
135,000 villages across 15 Indian states
By 2010, the Shakti network reached over 600 million consumers
Successful implementation after customization and adaptation in several South-
East Asian, African and Latin American markets
Launch of Shaktimaan initiative for men to distribute HUL products to villages
adjoining Shakti villages

Current Status of Project Shakti
Social