An Individuals Identity Is Formed By Society Media Essay

An Individuals Identity Is Formed By Society Media Essay An individuals identity is formed by society in which media plays a predominant role. There is a daily interactive relationship between the subject and the object, that is, human agents and the conditions of their subsistence, respectively. Theories of the individual emphasize on differences between people and deem these differences as natural. Individuals are constituted as the possessors of positions throughout the effects of social relations. Alternatively, other theories of the topic concentrate on peoples general experiences in society through watching TV, surfing the internet or reading the newspaper. It is these general experiences that are the most significant way of distinguishing who we are. Thus, subject identity is a social construction, not an ordinary one. When we connect with the media, we act and are acted upon, use and are used by the system. Ideology is not precise, but implicit in images, structures, and sign systems evident in the media which task is to establish the individuals as subjects. We have social identities conferred unto us, mainly through the mass media. For example, take the popular medium of magazines. Magazines are an easy way of targeting the exact audience that has been set out to be. This is important as not only are individuals capable to choose which magazine they would desire to read but they are also capable of utilizing it to assemble their own identity. One of the most outstanding images found in magazines is that of the thin and beautiful model, numerous females would glance at these images as a source of inspiration as to what their bodies should look like and would think that they were inadequate if they do not look like the models featured. For example a perfume by Giorgio Armani called Sensi, saying that I sense, therefore I am and a model lying across a table giving the impression that one must need this perfume in their everyday life, and the emphasis on womens fragrance. Our society today has been affected in such a materialistic world that it is so easy for advertisers to promote any old debris and still be assured that consumers will buy into it, regardless of the cost of the product. The media has us brain washed very well, and know how and what to promote to us in a very effective way. It is through the modern media apparatus that people achieve a sense of identity. There is no doubt that contemporary media is a culture possessed with the self. Via the mass media we are told ways in which to develop the self. We buy books, read articles in the newspaper, and we watch lifestyle programs. The mass media supply us with the talent to transform, create, re-create and mass produce identity. The media permits us to transform the very way we think of ourselves, for that reason it allows us to become and be seen the way we desire to be. A popular contemporary medium for transformation is found in the ability of an individual to build a web page on the internet. It offers a unique opportunity to write ones self on a global stage and for the author to believe about their identity. Generating such pages offers an exceptional chance for self-presentations in relation to several dimensions of social and individual identity to which one chooses to allude. We seek to be as straightforward as we would like to present ourselves to the human race. This technology is greatly about viewing ourselves a certain way, as it is about having other people view us. By abstracting oneself onto a web page, one sets a target to which one must stand true. It is understandable that due to the contemporary media with which we engage it is more likely that instead of achieving, experiencing and learning our identity, we are more likely to purchase and use our identity. Since personality is largely a subject of outward behavior and appearance, individuals begin to use consumption as a means of creating a social self. Thus identity becomes constructed, rather then exposed and variable, rather than preset. A fundamental support in the construction of identity is fashion. The problem with this type of construction is that by dressing a certain way, the fashion industry offers a new you. In acquiring certain styles of fashion and particular brands, people consequently relate themselves with the meanings embedded in those goods. These modified meanings thereby become piece of the perceived self. It creates a fake ideology, a mask for one in which one can change who they are by means of changing the way they dress. For example, Jerry Seinfeld i s backing up American Express Michael, Paul Reiser wants you to use ATT, and Jordan is selling you Gatorade. Why do these famous stars emerge on commercials and show up in ads? The idea is to subliminally give the product traits that it never even deserves, like wealth, fame, and even success. When you see Michael Jordan drink that Gatorade and then go for a 360 slam-dunk, they desire you to think that, Hey maybe if I drink Gatorade, I can turn into as great a basketball player as Michael Jordan. Now when you see someone like Jerry Seinfeld with American Express, they want you to think, If somebody as prestigious and successful as Jerry Seinfeld adores American Express, then it MUST be a great card to have. Besides the less obvious, there is just the fact that someone needs a famous celebrity to present and sell their product, rather than some ordinary person who holds no social figure in society. Society and mass media are primarily split between different desires, interests, and engagements, and so is the subject. There is an essential lack between personal identity and identification with the mass media: a gap that prevents identification from ending up in a state of clean identity. Identity is a case of building and articulation because as individuals we do not have a definite position in our social structure. We create identity in relation to those surrounding us and much of the cause for our own uncertainty about our identity is because the nature of society is endlessly changing. As beings that innately desire to be accepted, the way in which other people view and judge us has become of great importance. Hence as individual we all try to be as well as manage to conform to the ideas extended by the media. This is due to the detail that there is a need to feel part of a group, a want to feel as though one belongs, and to improve ones identity in the eyes of others. Studies report that communication allows young people to facilitate social involvement and thereby make a recognizable identity. Contemporary society and mass media produces the end of the individual, and encourages conformity. The mass media are responsible for brain washing the people of the paradox, your identity is only individual when it is the same as everybody else. The media operates as a needle which injects attitudes, ideas, and beliefs into the viewers who as a defenseless mass have little choice but to be influenced. As an outcome identities are assembled from the material generated by the media. The mass media establishments do have the authority to set the agenda, to select, to frame, to classify and to define appropriate issues. Consequently, media communication is a prearranged activity, which frames the social reality in accordance with the dominant ideology. The meanings that are collected from the media do not have to be final but are open to refashioning and reshaping. Ultimately we only get to choose from a selected few issues which reflect the interests of capitalists and large corporations. It is from these narrow issues that an individual assembles their identity. Certain standards and ideologies are imposed unto us, with no opposing views to counteract their influence. Thus, we can only illustrate from the cultural collection accessible to us. Mass communication can influence cognitive change amongst individuals, mentally order and manage the world for us and also plainly create conflict or violence between people in society. Therefore, authorities or interest groups who have enormous control on media especially the government, newspaper and television program producers need a proper consideration for media use as well as being accountable for consequences. Evidently the modern media penetrates everything that we bump into in our everyday life. The author of Understanding Power the Indispensable Chomsky, Chomsky showed how the conventional press is run by the political economy and how the spectator is made into a pawn. The author constructs a propaganda model in which he exposes how the government exploits the media to implement control over the people. The mass media, therefore, is a business tool that is used to program the population. The spectator is told what kind of desire he/she must have. The messages we obtain are selective, diverse, and contradictory. It is through the magazines, television, news papers and the internet that, at its disposal, society has a great deal of resources accessible to them. There is no such thing as a set identity; it is negotiable and constantly being altered in order to keep up with the altering nature of society as identity is assembled in relation to others. The media supplies us with tools, allowing us to develop into the person we want to be, and fit in with those around us. In my opinion media is a reflection of society, not the other way around. So if we want to really deal with violence, we should to start with ourselves, not with the media that is basically showing us the world as it is. You cant blame TV and music for all the unconstructive things that people do. Its the persons responsibility to be interpreting the message the correct way. You cant deny the fact that media does project wrong images towards young people but its how they interpret the messages and act in response to them thats important. Parents should explain to their kids that most of the stuff on TV is fictional. The majority of us watch TV; but most for people, these messages and images do not elicit nor drive impulsive behavior. However, because media has a huge impact on society, whatever is displayed and conveyed has a great effect on people, especially on younger minds. I think that violence and sex on TV and in music is used as the lone scapegoat as crime arises. The crime can only be blamed on the individual. Eminem and Marilyn Manson have the right to speak what they wish, people have the right to listen or not listen. But, no one has the right to murder. And if someone does commit murder, I dont think music, or violence that they see or listen to can or should be solely responsible for their crime. Is censorship the response to the problem of violent entertainment? Should we tell people what they can or cant read or watch? The simple respond to this question is no, we cant censor violent entertainment. Because of freedom of speech but there is a fair ratings system which works most of the time. Rappers, writers, performers, and singers write based on their life and what has gone on in it. A rapper raps with reference to poverty, shootings, and robberies, why? Because thats what the majority of them lived through. Eminem raps about things that board his nerves. Why? Because he lives with those feelings and emotions. People who use these artists as reasons to be brutal are wrong. Music and TV do not commit crime its the society and the people themselves. Thus I believe that although the media plays an essential role in defining who we are and establishing our identities, it does not govern our actions. 1. Parenti, Michael. Inventing Reality- Politics of News Media: St. Oartins Press, 1993. 2. Chomsky, Noam; Mitchell, Peter. Understanding Power: The Indispensable Chomsky, 2002. 3. Lorimer, Rowland. Mass Communication in Canada, 1996. 4. Kilbourne, Jean. Killing Us Softly. (Video)

Drugs :: essays research papers

The first time I did acid isn't the most interesting time I've done it, nor the most scary, but I guess it would still be a good read. I was going down to a friend's house on a Friday night. Everyone was planning to get majorly fucked up. A lot of people were going to do Dramamine. I read an FAQ on it, and it said if you have Asthma you shouldn't do Dramamine...and to be honest, Dramamine seemed pretty nightmarish after reading a few trip reports. So I decided to stick with something I knew: ROBO! I picked up this girl I promised to give a ride to my friend's house, and we stopped at the drug store, where I shopped for a nice bottle of Robotussin. I finally settled on generic CVS brand Robo. We hopped in the car, picked up an acquaintance of mine, Zack, and headed down to my friend's apartment. It was about an hour drive. We were all psyched because we knew we were going to be getting all fucked up that night. We listened to this local ska/punk band, Heft, and even though I felt like a dork, some Blink-182. I used to like them a lot, then they became famous, and I started feeling like a dork listening to them...I told myself that it's stupid to just not listen to things because of what other people would think though, and let myself enjoy the music. Besides, it was my tape. :) We saw this weird green lightning bolt while we were driving down. We started thinking maybe they're be a thunderstorm that night while we were all fucked up, and it would be awesome. After a little while, and a wrong turn or two, we ended up at my friend's (we'll call him Jo) apartment. Some of my friends were there already. There was P, who never does any sort of drugs...W, who always tried to get me to take acid, but i was too chicken...Jo, who owned the apartment...two girls who we'll call M and Fatty. Z was my acquaintance from the car, and H is the girl who I gave a ride down to the apartment. W told me that P was going to do Dramamine that night. That sort of worried me. P never did drugs, and I wondered if he would be ok, since the Dramamine trip reports I read seemed very disturbing.

Surf Exel

? HINDUSTAN LEVER LIMITEDA Project Report On SURF EXCEL ? 2. TABLE OF CONTENTS†¢ ACKNOWLEDGEMENTS†¢ INTRODUCTION†¢ EXECUTIVE SUMMARY†¢ INDUSTRY ANALYSIS†¢ COMPANY OVERVIEW†¢ FINANCIAL STATEMENT ANALYSIS†¢ MARKETING MIX OF ORISSA†¢ COMPETITORS ANALYSIS†¢ PROJECT1: o OBJECTIVES o SCOPE AND LIMITATIONS OF THE STUDY o RESEARCH METHODOLOGY o DATA ANALYSIS  § CONSUMER ANALYSIS o CONCLUSIONS†¢ APPENDIX o CONSUMER’S QUESTIONNAIRE o DETAILED FSA ? 3. EXECUTIVE SUMMARYThe project assigned to us was to study the business and marketing practice, competitorsin business and customers of Surf Excel, for Orissa market.For this a questionnaire wasprepared for the consumers. A sample of 53 consumers was surveyed. The respondentswere interviewed in market places across Bhubaneswar. After the analysis we came to the conclusion that the Surf Excel enjoys a space in the top2 positions in brand recall of the consumer. This is a positive sign for HL L. The researchalso shows that the market share of Surf Excel in Orissa’s detergent market isapproximately 66%. Also, from the survey it is evident that brand name, price andcleansing action are three of the most important attributes a consumer looks for in anydetergent brand.Surf Excel enjoys a good reputation with the consumers with respect toall these attributes. Another thing that we noted in this survey was that Television is the most usedinformation source for the consumer. The exact communication recall however, is verypoor among the consumer. This could be attributed to the ever increasing advertisementclutter, across all media. Thus, HLL should consider looking for other media likeoutdoors. It was also noted that over 50% of the consumers who used Surf Excel, would purchasepacks whose size was 1/2 – 1 kg and did not prefer purchasing the 200gm pack.We triedto find out the reason as to why this practice occurred, but to no avail. HLL shouldconsider promoting th is pack size in some way, or phase it out totally. Thus, we can conclude that Surf Excel enjoys excellent customer reviews. It gets specialrecognition for its superior cleansing action, the convenient packs it comes in, the ease it ? 4. is available with, and the fact that its price is at par with similar products available in themarket today. OBJECTIVES OF THE STUDY 1.The primary objective of the study was to understand the customers of Surf Excel ( type/ quality/ their decision making style/ source of information that they use for collecting information regarding Surf Excel) 2. The study was also aimed to understand the business and marketing practice of Surf Excel and the marketing mix used by HLL for Surf Excel. 3. Another important objective of the study was to understand the competitors of Surf Excel. 4. Efforts were also made to evaluate the financial strength and market capabilities of the parent firm, Hindustan Lever Limited. ? 5.INDIAN FMCG INDUSTRYBackgroundThe FMCG secto r has been the cornerstone of the Indian economy. Though, the sector has been in existence for quite a long time, it began totake shape only during the last fifty-odd years. The sector touches everyaspect of human life, from looks to hygiene to palate. Perhaps, defining anindustry whose scope is so vast is not easy. Generally, FMCG refers to consumer non-durable goods required for dailyor frequent use. The sector touches every aspect of human life, from looksto hygiene to palate. Perhaps, defining an industry whose scope is so vastis not easy.The FMCG sector consists mainly of sub segments viz. personal care, oral care andhousehold products. This can be further sub-divided into oral care, soaps and detergents,Health and Hygiene products, beauty cosmetics, hair care products, food and dairy-basedproducts, cigarettes, and tea and beverages. Major Indian consumer product companies (like Britannia, P&G, HLL, etc. ) have a verystrong presence through their strong brands. Diversified port folios, wide distributionnetworks and scale economies of these companies deter new players from entering.Brand equity, therefore, is an extremely important factor in FMCG industry. One of theother most critical factors is the ability to build, develop, and maintain a robustdistribution networkPost-reforms, the industrys growth has been hinging around a burgeoning ruralpopulation which has witnessed significant rise in disposable incomes. Consequently, therural markets have been witnessing intense competition in almost all the consumerproduct classes. Another reason which has led to rise in this trend is the saturation inurban markets in most of the consumer non-durable goods categories.This has led to theindustry players scrambling for greater rural penetration as a future growth vehicle, thearea which accounts for 70% of the total Indian householdsSo far, it has been a chequered graph for the MNCs operating in the Indian FMCGindustry. Domestic companies are only beginning to make t heir presence felt in theindustry. It has taken tremendous consumer insight and market savviness for the FMCGplayers to reach where they are today. But, the journey seems to have just now begun forthe players as the majority of the rural populace are yet to get access to the items of dailyusage like toothpastes, soaps and shampoos. 6. Value for moneyEver since the global recession of 1991-94, which hit consumer spending hard, value-for-money has become the buzzword for FMCG companies globally. These FMCGcompanies embarked upon major restructuring and cost rationalization exercises asbusiness continued to become fiercely competitive. Several packaging innovations werealso resorted to. India was no different. There was a paradigm shift towards value-for-money products and, to some extent, towards the rural market. What Nirma did all these years suddenly became the buzzword for many FMCG players.Price cuts became inevitable to keep the market share from shrinking. Sometimes, thecuts to uched ridiculous levels. Economic recession hit the urban pockets badly and forcedcompanies to train their guns on rural India, which was witnessing a major change in itsaspiration and lifestyles and even had an income that translated into increasing volumes. India’s agrarian economy is fundamentally strong. Rural India accounts for as much as 70per cent of the nation’s population. That means rural India can bring in the much neededvolumes and help FMCG companies to log in volume-driven growth.Companies such asHLL, Colgate and Britannia who already had a strong rural focus, stepped up the gasfurther. HLL unleashed its â€Å"Operation Bharat†. Britannia pushed its Tiger biscuits toevery nook and corner of the country, while Colgate went about wooing the rural massesby offering low-priced products in convenient packaging. Those who could not do it ontheir own went piggyback on somebody else. P&G, whose distribution is largely urban,chose to leverage Maricos retail reach. P&G and Smith Kline Beecham, nonetheless, are interesting cases.With small productportfolios like theirs, they have been able to achieve what others could not and provedthat what you need is a good product, marketed effectively and sold at the right priceOf late, an interesting trend in the Indian FMCG sector has been brand acquisitions. Thisrepresents a growing awareness among the FMCG players are talking today more andmore of product â€Å"fits† while discussing brand acquisitions. It is not just acquiringanything and everything as it was in the pastRural marketing has become the latest marketing mantra of most FMCG majors.True,rural India is vast with unlimited opportunities. All waiting to be tapped by FMCGs. Notsurprising that the Indian FMCG sector is busy putting in place a parallel rural marketingstrategy. Among the FMCG majors, Hindustan Lever, Marico Industries, Colgate-Palmolive and Britannia Industries are only a few of the FMCG majors who have beengung-ho about rural marketing. With reason. Certainly, rural marketing holds the key to success of FMCG companies, which aredesperate to find ways out to gain deeper penetration. Not just the rural population isnumerically large, it is growing richer by the day.Of late, there has been a phenomenalimprovement in rural incomes and rural spending power. ? 7. FMCG sector performance in last decadeThe fmcg sector in India showed a constant decline in the last decade. What started as 20-25% growth rate in year 1994-96, had reached a negative growth rate of -2. 8% in Q1’04. The FMCG sector is now mockingly called SMCG or slow moving consumer goods. ? 8. Source India Today – R K Swamy BBDO Guide to Urban Markets*Soap, Shampoo, Nail Polish, Washing Powder, Footwear, Tea, Coffee, Cigarettes, Electric Bulbs.Rank Towns States Average Monthly Spending on FMCG Products* in Rs. 1 Chandigarh Chandigarh 3,418 2 Greater Maharashtra 2,955 Mumbai 3 Chennai Tamil Nadu 2,886 4 Ahmedabad Gujarat 2, 869 5 Vadodara Gujarat 2,816 6 Pune Maharashtra 2,804 7 Coimbatore Tamil Nadu 2,684 8 Ludhiana Punjab 2,674 9 Faridabad Haryana 2,596 10 Hyderabad Andhra 2,533 Pradesh ? 9. The Fabric Care Market In IndiaDetergentsThe Indian fabric wash market consists of synthetic detergents (comprising bars, powderand liquids) and oil-based laundry soaps. The detergent powder market is furthersegmented based on price and form.It is characterised by brands from a plethora ofregional and local players competing with the national marketers primarily in the low-priced and mid-priced segmentsThe synthetic detergent market can be classified into premium (Surf, Ariel), mid-price(Rin, Wheel) and popular segments (Nirma), which account for 15%, 40% and 45% ofthe total market, respectively. The product category is fairly mature and is dominated bytwo players, HLL and Nirma. Nirma created a revolution in the market by pioneering theconcept of low-cost detergents.Currently, the market is highly segmented with thedifferential between the premium and popular segments at almost 7X. GrowthAlthough the per capita consumption of detergents in India (2. 7 kg pa) is comparable tosome countries like Indonesia, China and Thailand (around 2 kg pa), it is lower than inothers such as Malaysia, Philippines (3. 7 kg) and the USA (10 kg). High consumerawareness and penetration levels will enable the market to grow at an average 8-10% perannum with slightly higher growth in the rural areas. Higher penetration stems frompopularity of low-cost detergents.Hence, besides increase in per capita consumption,there is tremendous scope for movement up the value chain. Leading Fabricare Brands Available In IndiaSurf ExcelSurf comes from the stables of Hindustan Lever, the largest player in this market with anoffering at each price point. Surf was the first detergent powder brand to be launched in thecountry. It created the detergent powder category and introduced the concept of bucketwash to housewives hitherto u sed to washing clothes with laundry soap bars. Surf has, since,become generic to detergent market.Consumers refer to all their powders as Surf, evencompetitive powders are called Surf e. g. Nirma Surf ? 10. Selling over 60,000 tonnes per year, Surf is the market leader in the concentrate andpremium powder price segments Surf has always been the first to recognize and respond totrends. Whether it was through Surf with Easy Wash- a low lather variant, in 1994 or Surfwith Wash Boosters (1995) that provided best clean even in hard water. The brand SurfExcel now has three variants – Surf Excel Quickwash, Surf Excel Blue and Surf ExcelAutomatic – which address different laundry needs but each offers stain removal as the keybenefit.In 2003, recognising changing consumer purchase patterns, it once again redefined value forthe consumers by introducing the concept of monthly packs. Sensitive to the increasing concerns on environmental pollution and water scarcity problemsacross the country, it brought to the consumer Surf Excel Quickwash. This low lathervariant is the first eco-friendly detergent in the country, as it uses almost half the water otherdetergents require. Surf has innovated beyond the basic product into other aspects of laundry.Understandingthe need for easy-to-store packaging, tubs and jars were introduced. In order to helpconsumers dose correctly for the best possible clean, measuring scoops were built into thepacks. For convenience seekers, washing has been simplified with the ready to dose packs ofSurf Excel Automatic. Consistent innovation addressing ever-evolving consumer needs has earned the brand aplace in the hearts of consumers. Surf was rated in the top Ten Most Trusted brands in TheEconomic Times survey in 2003WheelWheel is Indias number one detergent brand.Launched in 1987, it cleans effectivelywith lesser effort, making a laborious chore like washing light and easy. Moreover,Wheel does not burn hands or harm clothes like some ot her detergents, which containa high percentage of soda. Ever since its relaunch in 2001, with the new positioning of best clean with less effort,Wheel has been growing strongly. Research showed that consumers seek a solution to heavyduty laundry, like bed sheets and curtains. Developing on this insight, wheel sought to ? 11. liminate the trouble of tough dirt or heavy-duty laundry. Mass market consumers havewelcomed the solution, making it the number one. Nirma – a home-grown product that revolutionized the detergent market in India, andsuccessfully challenged large multinational leaders in the process. The Nirma success story isa result of its founder, Dr. Karsanbhai Patels relentless focus on quality, cost and value. Thedistribution model, sustained line extensions and umbrella branding strategies have enhancedthe brands cost leadership.Today, the companys two brands, Nirma and Nima, aredistributed through more thantwo million retail outlets across the country, generating g rosssales in excess of Rs. 26,000 million. In the fabric care category, Nirma has three productsfor the lower-end market. The Nirma Yellow Washing Powder is available in pack sizes of30 gms, 200 gms, 500 gms and 1 kg, and is ranked as the largest selling single detergentbrand in the world. Nirma is one of the large st selling single detergent brands in the world.Nirma products aresold through two million retailers and reach 400 million. This brand had been ranked as the â€Å"Most widely distributed detergent powder brand in India† as per AllIndia Census of Retail Outlets carried out in 435 urban towns by the AIMS (Asian InformationMarketing & Social) Research agency [Brand Equity – The Economic Times, March 11, 1997]. As perthe ORG-MARG Rural Consumer Panel [December 1998] survey, Nirma brand has been ranked ashighest in terms of penetration in washing powder category [BT Rural Market Watch, Business Today, June22, 1999]. ? 12.World-over Ariel epitomizes ‘stain removal’ and removes even the toughest stains in the firstwash. Introduced in India in 1991, Ariel has continuously led other detergents in productinnovation. For example, it pioneered the use of enzyme technology for superior and safestain-removing power, longer-lasting perfume, and the P&G proprietary cleaningtechnology, which cleans everyday soil and dirt from garments. Over the years, the brand hasenjoyed endorsement from celebrities such as the former actress and now MP Shabana Azmiand lakhs of other homemakers in India.Tide is the World’s Oldest and Most Trusted Billion Dollar Detergent and is the marketleader in 23 Countries around the world. Tide provides outstanding whiteness on whiteclothes and provides excellent everyday cleaning for colored clothes too. Launched in Indiain mid-2000, the brand has gained popularity among Indian housewives, thanks to itssuperior whitening, creative advertising starring Shekhar Suman, and its Value-for-Moneyproposition. Both T ide and Ariel are billion dollar brands in sales for P&G globally. Now Large Packs of Tide and Ariel – World’s Best Detergents at Rs. 3/- and Rs. 50/- only Mumbai, India — March 02, 2004 — Procter & Gamble today announced that it has reduced the prices of Ariel and Tide bags (large packs) by 20-50%, while maintaining the superior quality. The superior quality ? kg pack of Tide now cleans a family’s one-month laundry in just Rs. 23/-, while a ? kg pack of Ariel cleans a family’s one-month laundry in just Rs. 50/-. This significant price reduction will now allow many more Indian consumers to experience the world-class experience of outstanding whiteness from Tide and superior stain-removal from Ariel in every wash.The new prices of Ariel and Tide are as follows: ? 13. Old Price New Price Old Price New Price Pack Size P&Gs move to slash Ariel Ariel Tide Tide detergent prices is 200gm Rs. 30 Rs. 22 Rs. 20 Rs. 10 ostensibly to get more consumers to 500gm Rs. 70 Rs. 50 Rs. 43 Rs. 23 experience its brands 1kg Rs. 135 Rs. 99 Rs. 85 Rs. 46 but the industry sees it primarily as a 1. 5kg Rs. 180 Rs. 145 N. A* N. A move to wrest the advantage from HLL 2kg N. A N. A Rs. 160 Rs. 88 in a sluggish market. The prices of sachets (20gm) of Ariel and Tide remain unchanged. N. A = Not Available in that size. Six months ago, P&G reduced the prices of Ariel and Tide sachets by 50% in order toencourage a larger number of consumers to experience their superior quality. The bettervalue offer on sachets received such an overwhelming, positive response from consumersacross India that P&G was encouraged to offer the irresistible value to Ariel and Tide bagusers as well, thereby make the world’s best detergents accessible to a larger number ofIndian consumers.P&G talked to over 3,000 consumers across the length and breadth of India and observedover 25,000 washing sessions in consumers’ homes. Consumers believed in the superiorquality of Ariel and Tide but indicated ‘pricing’ as a constraint in using Ariel and Tide on aregular basis. The drop in prices by the P&G has forced HLL to also react in a similar way thus shrinkingthe overall profit margins for the group. While the immediate impact of any price slash isbound to result in more volumes and thereby shares for the companies concerned,improving margins in the business remains doubtful. 14. Company OverviewHindustan Lever Limited (HLL) is Indias largest fast moving consumer goodscompany, with leadership in Home & Personal Care Products and Foods & Beverages. HLLs brands, spread across 20 distinct consumer categories, touch the lives of two out of 1888 Sunlight soapthree Indians. They endow the company with a scale of combined volumes of about 4 introduced inmillion tonnes and sales of Rs. 10,000 crores. India. The leading business magazine, Forbes Global, has rated Hindustan Lever as the bestconsumer household products company.Far Eastern Economic Review has rated HLL asIndia’s most respected company. Asiamoney has rated HLL as one of India’s best managedcompanies. Leading national publications, like The Economic Times, Business World, and 1895Business Today have also rated HLL as one of India’s most respected companies and the Lifebuoy soapnumber one in Market Value Added and EVA. launchedHLL is Indias largest marketer of Soaps, Detergents and Home Care products. It has thecountry’s largest Personal Products business, leading in Shampoos, Skin Care Products,Colour Cosmetics and Deodorants.HLL is also the market leader in Tea, ProcessedCoffee, branded Wheat Flour, Tomato Products, and Ice cream, Soups, Jams and 1902Squashes. Pears soap introduced inHLL is also one of the countrys biggest exporters and has been recognized as a Golden IndiaSuper Star Trading House by the Government of India; it is a net foreign exchange earner. HLL is Indias largest exporter of branded fast moving consumer goods. The companysExports portfolio includes HLLs brands of Soaps and Detergents, Personal Products,Home Care Products, Tea and Coffee.HLL is also driving exports in chosen areas whereIndia has a competitive advantage – Marine Products, Basmati Rice, Castor Oil and its 1903 Brooke BondDerivatives. It is Indias largest exporter of Marine products, and one of the largest global Red Label teaplayers in castor. launched. Market leading brandsHLL’s brands have become household names. The company’s strategy is to concentrate itsresources on 35 national power brands, and 10 other brands which are strong in certain 1905regions. The top five brands together account for sales of over Rs. 3000 crores.Each of Lux flakesthese mega brands has a potential scale of Rs. 1000 crores in the foreseeable future. introducedSome of the big brands in Soaps and Detergents are Lifebuoy, Lux, Liril, Hamam,,Pears,Rexona & Dove, (all soaps), Surf Excel, Surf, Rin, & Wheel (all detergents). HLLalso m arkets the Vim and Domex range of Home Care Products. 1913In the Personal Products business, HLLs Hair Care franchises are Clinic, Sunsilk and Lux Vim scouringshampoos. In Oral Care, the portfolio comprises Close-up and Pepsodent toothpastes and powdertoothbrushes.In Skin Care, HLL markets Fair & Lovely Skin Cream and Lotion, the introduced. largest selling Skin Care Product in India; a brand developed in India, it is now exported toover 30 countries. It has been extended as an Ayurvedic cream, an under-eye cream, soap ? 15. and talc, in line with the strategy to take brands across relevant categories. The other majorSkin Carefranchises are Pond’s, Vaseline, Lakme and Pears. In Colour Cosmetics, HLLmarkets the Lakme and Elle-18 ranges.In Deodorants, the key brands are Rexona, Axe, 1930Denim and Ponds, while the Talc brands are Ponds, Liril, Fair & Lovely, Vaseline and Unilever isLifebuoy. Axe and Denim are HLL’s franchises for Men’s toiletries. formed on January 1HLL has recently launched Lever Ayush Ayurvedic Health & Personal Care Products. Health Care is among the new businesses HLL has chosen to enter. The product rangecomprises Cough Naashak Syrup, Headache Naashak Roll-on, Dandruff NaashakShampoo, Hair Rakshak Oil and Body Rakshak Soap.The purity of the Ayurvedic 1931ingredients in Lever Ayush is endorsed by the renowned Arya Vaidya Pharmacy (AVP) of HindustanCoimbatore. It is for the first time that rigorous testing procedures of the pharmaceutical Vanaspatiindustry have been applied to Ayurvedic products. That is why the brand seal is ‘Truth of ManufacturingAyurveda; Proof of Science’. Company registered on November 27HLL has started franchised Lakme Beauty Salons, offering standardised services, in linewith the strategy to add a service dimension to relevant brands.The company has set up the Hindustan Lever Network, a direct selling channel, offering 1932the Lever Home range of Laundry and Home Care products and the A viance Personal Vanaspati manufactureCare range. starts at SewriThe company has also begun an e-tailing service, called Sangam, which can home-deliveron order by phone or through the Net, a diverse range of about 5000 branded andunbranded products. The service is now available in select areas of Mumbai and NaviMumbai, besides Thane. 1939HLL is one of the world’s largest packet Tea marketers.Its Tea brands – Taj Mahal, Red Garden ReachLabel, Taaza, – are among the top brands in the country; it also markets Lipton Ice Tea. Factory purchasedHLL and Pepsi have formed an alliance to distribute a full range of tea and coffee and soft outrightbeverages through vending machines; HLL already has a base of around 15000 suchmachines. The coffee business comprises Bru Instant Coffee and Deluxe Green LabelRoast & Ground Coffee. The Kissan and Knorr Foods range comprises Spreads & Jams, Biscuit Sticks, Soups, 1943 Personal ProductsSquashes, Tomato Ketchup, Sauces, Puree, and Cooking Aids.Popular Foods, like Wheat manufactureFlour and Iodized Edible Salt, under the Knorr Annapurna brand name, have met with begins in India atremarkable success. The range has been expanded with ready-to-eat 10-second chapatis. Garden ReachThe innovative offerings are changing consumer habits into using processed, hygienic, Factoryhealthy and convenient products. The Kwality-Walls Ice Cream range comprises exotic Sundaes, Viennetta Desserts,popular ‘Impulse’ segment products like Max, Cornetto and Feast, and Cornetto Ripple 1947Softies.Ponds Cold Cream launched. Max was extended in 2001 as sugar confectioneries, because children are a key consumersegment in confectioneries too. This is among the new businesses HLL has chosen toenter. ? 16. HLL has acquired Modern Food Industries (India) Limited, entering the bread market. Modern Foods was the first Public Sector Undertaking to be disinvested. Besides 1959 Surf launched. upgrading the existing Modern products, H LL has launched new products, among thembiscuits. HLL is liberating its brands from their existing category mindset.Historically, brandsoriginated and stayed within a category format. HLL sees its Power Brands as being able tooccupy a unique position in the consumers mind and therefore being able to stretch intoother product formats and categories. All such initiatives have had a promising start, and 1964there are more to come. Etah dairy set up, Anik ghee launched; Animal feeds plant atThe Distribution network Ghaziabad; Sunsilk shampooHLL’s distribution network is recognised as one of its key strengths — that which helps launched. each out its products across the length and breadth of this vast country. The need for astrong distribution network is imperative, since HLL’s corporate purpose is â€Å"to meet theeveryday needs of people everywhere. †HLLs products, manufactured across the country, the operations involve over 2,000 1969 Rin bar launchedsuppli ers and associates. HLLs distribution network, comprising about 7,000redistribution stockiest about one million retail outlets, directly covers the entire urbanpopulation, and about 250 million rural consumers.In addition to the ongoing commitment to the traditional grocery trade, HLL is building aspecial relationship with the small but fast emerging modern trade. HLLs scale enables itto provide superior customer service including daily servicing, improving their rangeavailability whilst reducing inventories. HLL is using the opportunity of interfacing more 1975 Close-updirectly with consumers in this retail environment through specially designed toothpastecommunication and promotions. This is building traffic into the stores while yielding high launched.. growth for the business.An IT-powered system has been implemented to supply stocks to redistribution stockistson a continuous replenishment basis. The objective is to catalyse HLL’s growth by 1978ensuring that the right pro duct is available at the right place in right quantities, in the most Fair & Lovely skin creamcost-effective manner. For this, stockists have been connected with the company through launched.. an Internet-based network, called RSNet, for online interaction on orders, dispatches,information sharing and monitoring. RS Net covers about 80% of the companys turnover. 930 Unilever is formed onHLLs foray into Network Marketing January 1 1988 Launch ofAs per the market surveys conducted it is expected that the consumer market in India is Lipton Taazaworth 13000 crores per year and in few years the network market will capture 500 crores as tea. per market surveys, considering the potential Hindustan Lever has launched HindustanLever Network (HLN), a unique Network Marketing opportunity . ? 17. 1991The Network marketing concept Surf Ultra detergent launched. In the normal marketing system, the manufacturer supplies the products through themiddle men such as brokers, wholesalers and retailers. These middle-men add theirestablishment costs and their own margin of profit or commission on the price. Thisincreases the price by approximately 45 per cent. The consumer therefore gets the productat atleast a 45 per cent markup from the manufacturers price. 1993 Tata Oil Mills CompanyIn network marketing, these middle men are eliminated. A person is invited to join and (TOMCO),become a member (also called Consultant) of the network marketing company. This merges with theperson in turn invites many more people to join under him to form a group.These group companymembers, in turn invite their acquaintance to join under them. This group is made tosteadily grow and it can grow into thousands or tens of thousands, in the course of time,depending upon the enthusiasm with which the Consultant pursue the sponsorship of newConsultants. 1994 HLL introducesThese Consultants make purchases of the products of the marketing company for self use Walls. and also for sale to other consumers. For t heir loyalty in regularly purchasing the products,the marketing co. gives discounts, handsome bonuses, rewards and special incentives.Each consultant in the group gets his shares of benefits depending upon the purchasesmade by him and also by the number of the consultant under him (called downlines). This 1995is called network marketing. HLL enters brandedThe growth in the beginning will be slow, from 1 to 2 to 4†¦Ã¢â‚¬ ¦. but later on it will be rapid, staples1000 to 2000 to 4000†¦.. and so on. Given below are the approx. benefits received, business with saltdepending upon your group strength and on the assumption that each consultant haspurchased goods worth Rs 1,000/- in the month. The benefits will be more for higherpurchases and bigger groups.Group Strength Benefits: 1996 HLL introduces253Nos(1+12+60+180) Rs17,938/- branded atta; Surf Excel launched1531Nos(1+18+216+1296) Rs64,558/-3061Nos(1+36+432+2592) Rs 1,28,818/- 2002 HLL enters Ayurvedic health & beauty centre. ? 18. Shakti-Hll Rural ProjectShakti is HLLs rural initiative, which targets smallvillages with population of less than 2000 people or less. It seeks to empower underprivileged rural women byproviding income-generating opportunities, health andhygiene education through the Shakti Vani programme,and creating access to relevant information through theiShakti community portal.Started in 2001, Shakti has already been extended to about50,000 villages in 12 states – Andhra Pradesh, Karnataka,Gujarat, Madhya Pradesh, Tamil Nadu, Chattisgarh, UttarPradesh, Orissa, Punjab, Rajasthan, Maharashtra and WestBengal. The respective state governments and several Project Shakti – By using self-helpNGOs are actively involved in the initiative. Shakti already groups, HLL has pushed its productshas about 13,000 women entrepreneurs in its fold. A typical down into the country. Into villagesShakti entrepreneur earns a sustainable income of about where people cannot spend more thanRs. 00 -Rs. 1,000 per month, which is double their average Rs 20-25 on FMCGs in a monthhousehold income. Project Shakti will expand the distribution cover bottom-up, the rural project will be top-down. Thiswill be a huge competitive advantage for Lever. The costs of expanding into these villages will betoo high for most companies, which do not have a portfolio spanning teas to detergents,In recent past Hindustan lever took some major decisions to remodel its business. These decisionshad major impact on the how distribution of lever products is managed in the market.Hindustan lever took the decision to simplify the company it merged all the different business unitsinto two large divisions: home and personal care (HPC) and foods and beverages (F&B). This gaveeach division â€Å"The advantage is that these divisions get us enormous scale,† The companydecided to whittle its brands down from 110 to 35, over the next three years. This is known asHLL’s Power Brand strategy. To identify these power brands, managers were asked to consider their growth potential, profitdelivery and the size of the opportunity.And to ensure that Lever would not lose sales, it wasdecided to migrate these brand users to the designated power brands. For one, the drastic slimmingdown of the brand portfolio which threw up huge problems in execution is now over. HLL is already combining its scale advantage to offer retailers a bigger basket of products and betterservice. Instead of different sales teams servicing the same retailer, the company has integrated bothHPC and Foods portfolios for modern trade chains like Margin Free. Once again, its large portfolio ? 19. ange helps Lever to use the power of customer relationships to corner greater shelf space and adisproportionately higher share of the branded segment. Modern trade, it reckons, is already growing at 15-20 per cent and will continue that way for a longtime. By bulking up the businesses, it is possible for Lever to service these mo dern trade outlets on adaily business. As a result, these retailers do not have to maintain high inventory levels. HINDUSTAN LEVER LIMITED — BOARD OF DIRECTORSMr. Harish Manwani Non Executive chairmanMr. M. K. Sharma Vice ChairmanMr. Arun Adhikari Managing Director (Home & Personal Care)Mr.S. Ravindranathan Managing Director (Foods)Mr. D. Sundaram Finance & IT DirectorMr. A. Narayan DirectorMr. V. Narayan DirectorMr. D. S. Parekh DirectorMr. C. K. Prahlad Director ? 20. The CompetitorsThe Indian FMCG markets have witnessed some of the classic struggles involving HLL. Sofar Levers have been able to stand their ground but times are changing. HLL’s response tothe latest challenges is being eagerly studied by the corporate India. In order to gain afoothold in Indian FMCG sector various domestic and MNC companies are using all kind ofschemes to woo customer from HLL.The major competitors of HLL are:Detergents: P&G, Nirma, Henkel SpicToothpaste: Colgate-PalmoliveBeverages: R asna, Coca-Cola (Sun fill)Tea: Tata teaCoffee: NestleIce-creams: AmulShampoo: P&G, Garnier Procter & GambleP&G Home Products Limited is a 100% subsidiary of The Procter & Gamble Company,USA. P&G Home Products Limited is one of Indias fastest growing Fast Moving ConsumerGoods Companies that has in its portfolio P&Gs global brands such as Ariel and Tide in theFabric Care segment, and in the Hair Care segment: Head & Shoulders – worlds largestselling anti-dandruff shampoo; Pantene – worlds No. beauty shampoo; and Rejoice – AsiasNo. 1 shampoo. Fabric CareProcter & Gamble has two of its world-leading detergents – Tide and Ariel, in India to caterto the main concerns of the Indian households. In India P&G has launched followingbrands: †¢ Ariel Front-O-Mat Ariel 2 Fragrances †¢ Tide Detergent †¢ Tide BarHair CareIn India, P&G’s beauty care business comprises of Pantene, the world’slargest selling shampoo, Head & Shoulders, the worldà ¢â‚¬â„¢s No. 1 Anti-dandruffshampoo and Rejoice – Asia’s No. 1 Shampoo. †¢ Pantene Pro V †¢ Head & Shoulders †¢ Rejoice ? 1. Baby Care †¢ PampersIn India, P&G will continue to be a midget, in turnover terms, when compared to HindustanLever. The two P&G subsidiaries in India (P&G Hygiene and P&G Home Products) todaygenerate a combined turnover of about Rs 1,100 crore, just a tenth of Hindustan Leverssales. P&Gs distribution network is largely urban and has a reach of 0. 4 m outlets. In 1994, Godrej entered into a strategic alliance with P&G for inter alia toilet soap business,under which Godrej used to manufacture soaps, which were marketed by a joint venturecompany.However post marketing alliance with P&G, the company lost significant part ofits market share and subsequently the arrangement was discontinued. Godrej’s entiredistribution network was then taken over by P&G. THE Procter & Gamble -Gillette deal could result in the former getting a significant boostboth to its scale of operations and range of products in the Indian market. That Gillettesportfolio of shaving razors, gels, grooming products and toothbrushes has no overlap withthat of P&G in India (shampoos, detergents, feminine hygiene, cold medication) is apositive.The addition of Gillettes businesses could help P&G expand its portfolio andacquire a more extensive distribution network; This may strengthen P&Gs hand in theongoing war for market share with Unilever arms in the Asian markets, particularly withHindustan Lever in India. NirmaNirma is one of the few names – which is instantly recognized as a true Indian brand, whichtook on mighty multinationals and rewrote the marketing rules to win the heart of princess,i. e. the consumer. It was way back in ‘60s and ‘70s, where the domestic detergent market had only premiumsegment, with very few players and was dominated by MNCs.It was 1969, when KarsanbhaiPatel started door-to-door selling of h is detergent powder, priced at an astonishing Rs. 3 perkg, when the available cheapest brand in the market was Rs. 13 per kg. In a short span,Nirma created an entirely new market segment in domestic marketplace, which is, eventuallythe largest consumer pocketand quickly emerged as dominating market player. Now, the year 2004 sees Nirma’s annualsales touch 800,000 tones, making it one of the largest volume sales with a single brandname in the world.Looking at the FMCG synergies, Nirma stepped into toilet soapsrelatively late in 1990 butthis did not deter it to achieve a volume of 100,000 per annum. This makes Nirma thelargest detergent and the second largest toilet soap brand in India with market share of 38%and 20% respectively. SoapsIn 1992, sensing a strong need to expand the market through PenetrativePricing, Nirma entered this market with the launch of ‘Nirma Bath Soap’&‘Nirma Beauty Soap’ . In 1998 Nirma expanded its product line in the soap ? 2 2. ategory by introducing ‘Nirma Lime Fresh’ & ‘Nirma Rose’. This brand had carved a nichein its segment by achieving leadership position just within two months of its launch. It isavailable in 100g and 150g pack sizes. Nirma entered the premium soap segment when itlaunched ‘Nirma Sandal’DetergentsNirma launched â€Å"Nirma Washing Powder† in Indian market in year 1969, This productwas priced at almost one third to that of the competitor brands, resulting into instant trial bythe consumers. Presently Nirma has different variants in Indian market.Nirma washing powderNirma superNirma popularEdible SaltNirma has also entered the Food market in the recent past with launch of Nirma Shudh. ? 23. FINANCIAL ANALYSISRatio Analysis ? 24. All figures in Rs cr Particulars Dec 2001 Dec 2002 Dec 2003 Dec 2004 Sales 12420. 71 10641. 15 11919. 04 11594. 65 Total assets 7089. 06 7761. 01 8104. 68 7820. 34 Net worth 3170. 86 3713. 91 2189. 22 2148. 67 Bor rowings 102. 55 86. 23 1715. 18 1604. 25 Capital Employed 3273. 41 3800 3904 3752 Debtors 1254. 38 1169. 49 1228. 55 793. 56 PAT 1576. 47 1757. 59 1687. 3 1208. 4 PBDIT 2211. 63 2461. 31 2462. 92 1875. 63 Depreciation 202. 63 192. 65 199. 99 195. 68 PBIT 2009 2269 2262. 9 1680Current liabilities & Provisions 3709. 17 3841. 92 4084. 71 3919. 71 Current assets 3505 3510 3610 3132 Current assets -Inventories 2201 2146 2120 1574 Long term Debt 102. 55 86. 23 1715. 18 1604. 25 Interest 12. 31 12. 86 69. 12 136. 25 Total Purchases 6077. 97 5389. 04 5438 5413. 77 Profitability Ratios Operating Profit Margin (%) 16. 17 21. 30 19 14. 5 Net Profit Margin Ratio (%) 12. 68 16. 51 14. 15 10. 42 ROTA (%) 28. 3 29. 23 27. 92 21. 5 ROCE 61. 37 59. 72 58 44. 77 Return on Equity (%) 49. 71 47. 3 77 56. 23 Liquidity Ratios Current ratio 0. 944 0. 91 0. 88 0. 79 Quick Ratio 0. 59 0. 55 0. 52 0. 40 Absolute Cash Ratio 0. 25 0. 254 0. 218 0. 20 Solvency Ratios Debt Equity Ratio . 032 0. 023 0. 78 0. 75 I nterest Coverage Ratio 163. 2 176 32. 74 12. 33 Efficiency Ratios Debtor Days 38. 85 40. 11 37. 62 25 Creditor days 135. 31 149. 2 131. 62 145. 23 Total assets turnover ratio 1. 75 1. 37 1. 47 1. 48 ? 25. Interpretation: †¢ Profitability Ratios:HLL earns 14. paisa on every Re. 1 of Sale before Interest and Taxes It ultimately makes 10. 42paisa on every Re. 1 of Sale after Interest and Taxes. It is visible that Hindustan Lever Ltd. has not been able to increase its Operating Profit marginconstantly over the years. We can see that the operating margin has decreased considerable in thelast year. This is mainly due to the fact that the interest cost of HLL has almost doubled from 69. 12crores to 136. 25 crores. Moreover the company’s operating expenses have increased by almost 75% in the year 2004.The efficiency has certainly decreased over the last few years mainly owing tohigh operating expenses , increased interest burden and high indirect taxes. The Net Profit Marginhas also decreased by 17. 8 % in 2004 as compared to 2001. This is mainly due to the decrease insales by Rs. 826 cr. HLL generates 21. 5% Return on Total Assets (ROTA) that it employs in its operations in theyear ended 2004. ROTA has decreased in the last year mainly due to the fact that its profit marginhas decreased. It could be ecause of high competition as a result of which profits have decreasedand the total assets of the company have increased. As we can see that the Return on Capital Employed (ROCE) for Hindustan lever Limited hasdecreased considerably during the last year mainly due to lower profit margins. The company isearning a return of 44. 77% on the funds employed by it. Though the ROCE has seen aconsiderable change, even now the company is getting good enough returns and can pay goodenough dividends to the shareholders as we saw the case in the year 2004 where the rate ofdividend was 250%.The Return on Equity Ratio (ROE) states how much profit a company earned in comparis onto total amount of shareholders equity on the balance sheet of the company. Here, we see that theROE of HLL has increased in comparison to the year 2001 but this cant be concluded as afavourable situation for the company as looking at the figures in detail we can notice that there hasbeen a near to 30% decrease in ROE in comparison to the year 2003 , also we do see that the PATof the company has fallen by about 23% and the shareholders equity has also decreased by 32% incomparison to the year 2004. But Even now an ROE of about 56. 3% is considered to be verygood. †¢ Liquidity Ratios:It can be seen from the above table that the Current Ratio for all the years is less than 1. Thissignifies that HLL has short term liabilities greater than the short term assets. It implies that thecompany would have problems in managing its short term liabilities and liquidity requirements. The company might have to resort to financing its short term liquidity requirements by long termsources of finance. We can observe that the current assets have decreased by 13 % and at the same time the currentliabilities have decreased by just 4 % in the last year.The reason is that since the company is ? 26. using long term sources of finance to fund its short term obligations therefore the interest burdenhas increased and as a result the cash balance has decreased . Other receivables have also decreasedby more than 66% leading to a fall in current assets. †¢ Solvency Ratios:The company was highly unleveraged in the years 2001 and 2002. It was risky as the company hadinvested a huge amount of its own funds as compared to debt. However in the last 2 years thecompany has changed its policy and is leveraging the advantage of debt along with equity.Thoughthe debt equity ratio of 0. 75 is not good enough as compared to industry norms of 2:1 but thecompany is moving towards a favourable debt equity mix. It has realized the importance of tradingon equity . The Company has increased its d ebt burden by 1470% in the last 4 yearsInterest Coverage Ratio(ICR) basically signifies the ability of a firm to service its interest burdenthrough the profits generated . In the initial years when the firm had not employed debt its interestburden was very low.As a result the Interest Coverage ratio is very high, gradually the companyhas employed more debt and as a result of which the interest burden has increased significantly. Moreover, due to high competition and operating inefficiency the earnings of the company havedeclined. As a result the ICR has reduced from 163. 2 to 12. 33 in the last 4 years. However an ICRof 12. 33 is still very impressive which reflects the company’s ability to pay interests on loanseasily. This is a good indicator to the various financial institutions providing long term sources offinance to HLL. Efficiency Ratios:Here, we see that the Debtors Days for the company is less than the Creditor Days of thecompany. From this we can interpret that the company has a favorable cash position as it is makingits payments long after receiving the dues from the debtors. Here, from the Asset Turnover Ratiowe can know how efficiently the firm is using its assets, the ratio for which is pretty low for thecompany. The Creditor Days as well as Debtor Days both show negative growth which reflectsnegatively on the company’s financials. The Asset Turnover Ratio also shows negative growthwhich is also not a good sign for the company.Thus, looking into these figures we can analyze thatthe efficiency level of the company has gone down vis-a-vis the previous years and hence thecompany needs to look urgently into these matters so as to improve the efficiency of the company. O DU-PONT RATIO ANALYSIS:The Du Pont ratio analysis is a combination of financial ratios in a series in order to assess theinvestment returns of the company. It combines the financial ratios of both the Income Statementas well as the Balance Sheet in order to assess either the Return on Equity or the Return onInvestment.One of the Plus points of this method is that it provides a clear understanding of howthe company generates its return. This analysis provides an insight into the importance of assetturnover as well as sales to overall return. This formula shows the relationship of profit margin andturnover how these two complement each other. ? 27. The Du Pont ratio divides the Return on equity into three parts: Net Profit Margin, total assetturnover, and the company’s use of leverage referred to as Equity Multiplier also. DU-PONT CHART FOR HLL FOR THE YEAR 2004 RETURN ON EQUITY =PAT/NETWORTH 56. 3% Equity NET PROFIT TOTAL ASSET Multiplier MARGIN TURNOVER =TA/NW =PAT/NETSALES =SALES/TA =10. 42% =1. 48 =3. 64% RETURN ON ASSETS ROA=PAT/TA =15. 44%Growth Trends Over The Years Particulars Dec-01 Dec-02 Dec-03 Dec-04 ? 28. Sales 12420. 71 10641. 15 11919. 04 11594. 65Expenditure 10627 8690 9941 10076Change InSales (%) — -14. 33 12 -2. 7Chang e InExpenditure(%) — -18. 22 14. 39 1. 35Change inPBIT (%) — 12. 94 -0. 26 -25. 75Change inPAT (%) — 11. 48 -3. 99 -28. 38Change inBorrowings(%) — -15. 91 1889 6. 46Change InInterest (%) — 4. 46 437. 48 97. 12 ? 29. COMMON MARKETING MIX FOR ALL MARKETS 1.Product consists of brand, quality, appearance, 2. Price Structure consists of prices, dealers and consumers discounts. 3. Promotional activities consist of advertising, media. 4. Placement (distribution) system consists of dealers, distributors, retailers and overall logistics. MARKETING MIX FOR RURAL MARKET 1. Product 2. Price 3. Promotion 4. Placement system 5. Packaging-Reason for putting it separately is because symbols and packaging becomes very important when literacy levels are very low. 6. Retailer is the one who gives all information about brand choice and consumer feedback. 7.Education is very important for rural sector-eg. Project Shakti 8. Empowerment Example-Project Shakti and Self He lp Groups. PRODUCTSurf derives its name from ‘Surfactant’ the basic ingredient of a detergent. After 44 years, Surf brand has been upgraded and made more modern and contemporary. Surf has changed – the entire brand is now called â€Å"Surf Excel†. Continuousimprovements in the formulation of the product and introduction of new ingredients e. g. enzymes, along with new perfumes have ensured that the product meets the evolvingconsumer needs. The brand Surf Excel now has three variants – Surf Excel Quickwash, ? 0. Surf Excel Blue and Surf Excel Automatic – which address different laundry needs buteach offers stain removal as the key benefit. Surf Excel Blue Target segment: Economic segment. Attributes:-Removes stains without fading colours. Sizes avalaible: 25gm, 200gm, 500gm, 750gm, 1. 5kg, 3kgSurf Excel Quickwash (also called as Surf Excel Easy wash)(Hitherto known as just Surf Excel) Target segment: Superior quality for washing machine users. Sizes available:- 20gm, 20gm, 500gm, 1kg, 1. 5kg Attributes:-Stain removalSurf Excel Automatic Target segment:-Washing machine owners –Top and front loading machines .Sizes available:- 600gm, 1kg Attributes: Low lather detergent, anti corrosive, stain removal, ensures longer life of fabric. PRICELatest price war between detergent majors, Hindustan Lever (HLL), Proctor and GambleIndia (P&G), Nirma and Henkel-Spic India (HSIL) has proved that price in the marketingmix is very critical for growth of HLL products. If Surf excel prices were reduced to match the price cuts of their competitor (P&G),simultaneously they had to ramp up spending on advertising and promotions to increaseconsumption and penetration in the market and retain values of premium brand ? 1. PROMOTIONSSurf communication has been pleasant, soothing and gentle, Surf Excel has had adistinctively bold ‘tongue in cheek’ style of communication. Promotions for Surf Excelare more often than not tactical w eapons. Gift is offered to the consumer to gain short-term patronage or to engineer enhanced consumption. Choice of various promotionalgifts is usually governed by what can be bought cheap rather than any brand-relatedfactors. Surf Excel has always been sensitive enough to recognise the change in the consumerchoice dynamics.In some of their promotions, they have pampered influencersconsidering that brand choice in family products is a collective exercise. Various promotions being used for Surf are: †¢ Scholarship offer –Rs five lakh scholarship. Extremely rare and intelligent use of the marketing budget. Beauty of this promotion is in its design. An innovative and clever way of underscoringthe core promise of Surf Excel — stain removal!! Visual depiction in the ad is student-focussed — there are no mothers or daughters to be seen in the ad.Most of the people inthe ad are in their teens. The protagonist himself is barely in his teens. This can be anindicatio n towards changing consumer algorithm. This was backed by Win with Stains campaign – one of the largest campaigns taken upby Surf excel. This promotion is happening in Orissa markets which is aimed at offering consumers achance to win prizes as well as give students an opportunity to pursue further studies. Theaim of the whole campaign is to drive home the point that stains are good in life and oneis not to be scared to get themselves dirty.They are not only doing road shows,advertisements but branded horoscope columns in keeping with the theme of luck andfortune. They have roped in former South African cricketer Jonty Rhodes to participate in theWin with stains washathon to wash the largest stain in town with kids of the NGO -Magic Bus †¢ 1 bucket free with 3kg of Surf Excel has really managed to increase sales revenue of Surf excel. This is the most successful consumer promotion till date in Orissa market. †¢ Surf KidStains – a roadshow that invites consume rs to get first-hand experience of using Surf.Surf has taken communication beyond mass media advertising and involved consumersin the brand’s promise in the real world. It has touched consumer’s life through schoolcontact and in-store programmes. Road shows have helped to go to the consumers anddemonstrate superior performance vis-a-vis competition. ? 32. PLACEMENT SYSTEMIn Orissa, HLL has around 100 dealers and distributors. But HLL is into the exercise ofreducing number of channels in Orissa by increasing territory size of each dealer. HLL Distribution in Rural MarketsHLL has come up with new distribution channels to cater to rural markets.For long-term benefits, HLL has mounted an initiative, Project Streamline, to furtherincrease its rural reach with the help of rural sub-stockists. It has already appointed 6000such sub-stockists. As a result, the distribution network directly covers about 50,000villages, reaching about 250 million consumers. The pivot of Streamlin e is the RuralDistributor (RD), who has 15-20 rural sub-stockists attached to him. Each of these sub-stockists is located in a rural market. The sub-stockists then performs the role of drivingdistribution in neighboring villages using unconventional means of transport such astractor, bullock cart,etc.The Streamline system has extended direct HLL reach in these markets to about 37% ofIndias rural population from 25% in 1995 and the number of HLL brands and SKUsstocked by village retailers has gone up significantly. ? 33. PACKAGINGPackaging plays a key role in rural markets. Since customers are daily wage earners andthey don’t have monthly incomes like the urban consumers have, so Surf excel ispackaged in smaller sizes of 20gm so that they can afford given their kind of incomestreams. EDUCATIONSince vast majority of rural India lacks even basic education levels and modern outlook,HLL is training their new sellers to basic education levels.This is example of ProjectShakti which is explained in detail later. EMPOWERMENTHLL runs the program of Self-Help Groups (SHG), which operate like direct-to-homedistributors. The mo del consists of groups of (15-20) villagers below the poverty line(Rs. 750 per month) taking micro-credit from banks, and using that to buy HLL products,which they will then directly sell to consumersPrices of products 20gm 25gm 200gm 500gm 600gm 750gm 1kg 1. 5kg 3 kgSurf Quickwash 2 NA 23 53 NA NA 103 153 NASurf Automatic NA NA NA NA 90 NA 145 NA NASurf Blue NA 2 16 40 NA 53 NA 103 220 ? 34.Range of productsIf we divide detergent industry into three tiers – †¢ Premium at Rs. 80-140 per kg †¢ Mid-price at Rs. 30-50 per kg †¢ Popular at Rs. 15-25 per kgPopular segment accounts for 80% of the detergent industry. HLL leads in detergent powders withPremium – Surf ExcelMid price – SunlightPopular – Rin, WheelDealers and distributorsRetail Distributor MarginsExample of various distributor discounts on sale of these variants. Sale of 200gm Surf Excel Dealer Discount of 8%Sale of 20 gm Surf Excel Dealer Discount of 12%Wholesale Distributor MarginsThey get a standard discount of 1. % on sale of any variantStrategies in Orissa market 1. Shakti ProgramWith a twin objective of creating â€Å"income-generating capabilities† for underprivilegedrural women and â€Å"improving their rural living standard† through health and hygieneawareness, the Project Shakti is implemented in Orissa. Housewives and old ladies are targeted for this project. They are trained and given basiceducation to sell products. All products which are priced below Rs 5 are sold through thisproject. The sellers which are all ladies are paid margins of 3% on their sale of products.Now out of a total of 15,454 Shakti Entrepreneurs across India, Orissa hasover 928 (6%)Shakti Entrepreneurs spread across 22 districts. They are operating through Self Help Groups (SHGs) which is makes women direct-to-home distributo rs of HLL. Partnerships with several NCOs and support from stategovernments have been key enablers for the programme. Currently women entrepenuersare earning an average income of Rs. 7007- per month, doubling their household income. For the SHG women, it provides a stable, sustainable source of income.For villagers, thischannel has become a source of genuine and correctly priced products. ? 35. SALES TREND IN BHUBANESHWARBig Bazaar ,BhubaneshwarSales figures of Surf excel and is competitors Surf Ariel TideJuly sales 1,21,000 26,246 71,672July sold quantity 1787 pieces 341 pieces 1996 pieces ? 36. MARKET SHARE OF SURF Bhubaneswar, 20% Orissa, 35% Surf Excel Surf Blue Orissa, 65% Bhubaneswar, 80%SALE OF SURF EXCEL ON BASIS OF DIFERENT SIZES 10% 25% 20gm 200gm 500gm others(1kg,1. 5kg) 15%50%SALE OF SURF BLUE ON BASIS OF DIFERENT SIZES 7% 13% 20% 500gm 750gm5% 1kg 3kg 55% others(25gm,200gm) ? 37.PERCENTAGE SHARE OF SURF IN PREMIUM DETERGENTSMARKET 25% Surf Excel Ariel 75%SALE OF SURF EX CEL ON BASIS OF SEASONSCustomers reduce their washing frequency in rains, so the sales are drastically affected. Sale of detergents is strongly affected by seasonal changes as shown in the chart below. 12% 18% Summers Winters Rains 70% ? 38. COMPETITOR ANALYSIS. In this section we compare HLL with its competitors, viz. Proctor and Gamble (Ariel, Tide) and Nirma Ltd (Nirma washing powder). We now compare these products and the companies on the various counts. Market Share: The per capita consumption of detergents in India is 2. kg per annum. The synthetic detergent market can be classified into three main categories – Premium (Surf and Ariel) – 15% of total market Mid price (Rin and Wheel) – 40% of total market Popular (Nirma) – 45% of total market. Product Comparison: HLL (market share – 40%, including all 3 segments) manufactures Surf Excel in three avatars, Surf Excel Blue, Surf Excel Automatic and Surf Excel Quick wash. The USP of Surf Excel is that it reduces soaking time and water usage by 50%. It also contains a lesser amount of bleach than Ariel or Tide. P&G (market share – 12%, including all 3 segments) produces both Ariel and Tide.Ariel is produced in three types, Ariel Front-o-mat, Ariel Spring Clean and Ariel Fresh Clean. The USP here would be removal of tough stains while taking care of cloth quality and imparting a fresh fragrance to it. Tide detergent improves washing experience while imparting a lingering lemon fragrance to clothes. Nirma (market share – 30% of popular segment) comes in three variants, Nirma washing powder, Super Nirma washing powder and Nirma popular washing powder. Its USP would be low prices and the value for money it gives to the customer. Pricing Comparison: We now compare the prices for these brands.The price of each product and its variant is shown in the table b 20gm 200gm 500gm 600gm 750gm 1kg 1. 5kg 2kg 3 kg 4kg (30sachets)Surf Quick wash 2 23 53 NA NA 103 153 NA NA NASu rf Automatic NA NA NA 90 NA 145 NA NA NA NASurf Blue NA 16 40 NA 53 NA 102 NA 220 NAAriel 2 22 50 NA NA 99 145 NA NA NATide 1 10 23 NA NA 46 NA 88 NA 186 ? 39. Place comparison:HLL’s distribution system is one of its key strengths. The delivers its finished productsto various Carrying and Forwarding Agents, via whom the goods reach differentwholesalers. From here the goods are delivered to either rural or urban retailers, viawhom they reach the consumers.HLLs scale enables it to provide superior customer service including daily servicing,improving their range availability whilst reducing inventories. An IT-powered system hasbeen implemented to supply stocks to redistribution stockists on a continuousreplenishment basis. The objective is to catalyze HLL’s growth by ensuring that the rightproduct is available at the right place in right quantities, in the most cost-effectivemanner. For this, stockists have been connected with the company through an Internet-based network , called RSNet, for online interaction.As far as distribution to rural areas is concerned, they use a process called ProjectStreamline, wherein there exist networks of rural sub-stockists, who operate in the ruralareas itself. 20-30 sub-stockists come under a rural distributor (RD). The sub-stockists arethen responsible for distributing the products in rural areas. Nirma Limited markets its products through its fully owned subsidiary Nirma ConsumerCare Limited (NCCL), which was incepted in 1985. NCCL then resells the productsthrough ‘Nirma’ and ‘Nima’. Nirma pioneered the concept of flat distribution network.Nirma Consumer Care Limited operates with two parallel distribution networks. TheNIRMA brand is marketed through the first network, which consists of about 450exclusive distributors. It is one of the lowest cost FMCG distribution channels of thecountry. The principle channel for Nirma’s Products is the lowest cost system in Indiawith in built fle xibility and speedy distribution. All NIRMA and NIMA range of productshave a retail reach of over two million retail outlets and more than 40 million loyalconsumers spread all over the country.The Company has been successful in establishingan extremely good urban as well as rural presence through the two distribution channels. The distribution channels have played a significant role in making Nirma a householdname. The efficient network has made Nirma Washing Powder the brand with highestpenetration in its product category. The network is well equipped to meet the demands ofthe loyal consumers of the Company across the country. ? 40. Promotion comparison:HLL. Advertising. Surf excel, synonymous with the catch line, ‘Surf Excel hai naa! ’ was the first nationaldetergent brand on television.It has indulged in numerous advertisement campaignswhich have gained a lot of popularity. Surf Excel and Lalitaji ad also was in news for a long time. Slice of life situations havegene rated high levels of interest in the communication. Using consumer speak in the formof testimonials has helped in building credibility in the brand. â€Å"She was a hard-headed bargain-hunting housewife who demanded value for money andnot just cheap price. Consumers faith in Surf was restored, and not just because sheoffered a rational argument. The real reason Lalitaji was believed was because she wastrusted y the Indian housewife to get her a good bargain. We showed her bargainingwith the vegetable vendor about good tomatoes and bad tomatoes †¦ `Sasti cheez orachchi cheez me farak hota hai, bhai saab. â€Å"This advertisement reversed a declining brand share trend. The currents advertisement on television shows noted actor and human rights activistShabana Azmi (who did promote Ariel once upon a time), walking with two buckets ofwater and encouraging a crowd of people to do the same. It basically plays on SurfExcel’s strength to perform with lesser amounts of water.It thus underlines th

Ford Motor Company Marketing Strategy Essay - 6259 Words

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