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ASIA-PACIFIC INSTITUTE OF MANAGEMENT

Submitted to:

Prof Mr. Kuldeep Sharma

Submitted by

JITENDRA KUMAR SINGHAL (2K6/DM3/179) AMIT SHARMA (2K6DM3/181) NEERAJ YADAV (2K6/DM3/182)

Group XII

TABLE OF CONTENTS
1. Acknowledgement 2. Introduction of the company 3. History of the brand ARIEL 4. Outline of the company 5. Product complete range 6. Price list 7. Strategy for ARIEL 8. Market Competition 9. Industrial size 10.Growth rate of P&G 11.Building New Market 12.Pricing of Ariel 13.Nine marketing mixes of strategy on prices 14. P&G 's supply chain 15.Promotion 16. Popular advertisements of Ariel 17.SWOT analysis 18.Environmental analysis 19.How can we asses environmental impact? Use Life Cycle Assessment (LCA)! 20.STP analysis 21. Segmentation profile for Ariel 22. Bibliography

Acknowledgement

At the outset, it is our duty to acknowledge with gratitude the generous help that we have received from retailers and wholesalers for completion of this market research project. We are grateful to Prof KULDEEP SHARMA who served as source of inspiration while working on this assignment. We were made to work in team, which inculcated team spirit among us. We also thank all those who helped and cooperated with us at each and every step. It was with their assistance that the market survey conducted by us was a success. We hope the knowledge and experience which we gained here will be of immense help to us when we will step into market to work in the industry

INTRODUCTION

DETERGENT HISTORY & EVOLUTION


RESEARCH ON CUSTOMERS NEEDS Consumer research is a science in its own right. Market Research is technique, with the ultimate objective of collecting information that is helpful in product development. In essence, this research falls into one of two broad categories: quantitative or qualitative. Within each category, different techniques may be used depending on which one best suits the research objective.

QUALITATIVE RESEARCH Qualitative research is used to generate ideas. It involves small groups of people, and requires in-depth interaction between the researcher and the participants.

Focus Group Discussions This is a common technique for exploring ideas and making initial evaluations. A relatively small group of people (6 - 12) is brought together and asked to talk about certain topics. The advantage of the group interaction is that people can build on one another's ideas and comments.

In-Home Visits People who use the product are interviewed at home. They are asked questions about the task they use the product for, the product, the desired end result, how they judge the end result and which improvements they would like. Being in the home provides an opportunity to understand the actual conditions under which the task is performed and what the constraints are from the user's point of view. In-Context Visits People who use the product are interviewed while they are performing the task or using the product. The task may be anything related to the product, such as laundering, showering or shampooing. This type of research provides valuable insight into the details of how people use a product, how they judge the end result, and which improvements they desire. In-Store Interviews One-on-one interviews with customers while they shop allow us to better understand how the actual purchase decisions are made at the point of sales

QUANTITATIVE RESEARCH Quantitative research is used to generate quantitative habits data or to evaluate new ideas or prototypes. It involves larger groups of people and statistical analysis of data.

Habits and Practices


This requires large-scale studies. Respondents are asked to keep written records of the details of product usage for an extended period of time by making hand-written notes in a product diary or by completing a diary on the computer.

Blind Tests Blind tests are product usage tests in which a new or upgraded product is given to participants who do not know the brand of the product. The benchmark is either the current product or the key competitor's product. Virtually every product upgrade or new product launch by Procter & Gamble is supported by blind testing. Concept Aided Usage Test/Concept & Use Test People are first presented with the product or brand's concept (which will later be the basis for advertising) and then given the product for usage. This helps us learn if the product delivers as promised and whether the whole consumer proposition (including packaging, artworks and pricing) is appealing Quality Monitoring This is testing done to evaluate whether a product as purchased meets both consumer requirements and product design criteria

A Task with a Long History


Doing laundry is one of the oldest domestic tasks known. Although the laundry process differs between cultures and has varied over time, the basic consumer need has not changed: to remove dirt and get clothes clean. To achieve complete soil removal, however, is not a small challenge. The wash parameters that can affect the outcome of and consumer satisfaction with any particular wash can be summarised by seven factors (see Figure 1). For the consumer, there are literally hundreds of different possible combinations for any given wash cycle.

Unlike the soap and water used by our great-grandparents, modern detergents are technologically quite complex. This is in response to the demands of today's consumer, who expects both soil removal and fabric care. Modern detergent technology delivers these attributes during laundering through two basic process categories, namely: Physical removal of soil/stains from garments and chemical modification of soil/stains, either by hydrolysis or oxidation (bleaching), resulting in their solubilization and/or decolorization.

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Protection of fabrics through the use of polymers, protection of colours by color-lock technology or dye transfer inhibitor, elimination of dinginess and delivery of ease of ironing. Building Blocks and Performance Enhancers Laundry detergents include a variety of ingredients to remove soil and stains from garments and keep them suspended in the wash solution. An overview of the primary ("Core") building blocks and their role in the overall wash process are presented below. The table shows the typical ingredients in a modern laundry detergent, grouped by function. Surfactants anionic surfactants cationic surfactants nonionic surfactants Enzymes lipases amylases cellulases protease Polymers polycarboxylates polyethylene glycols cellulose derivatives Oxidizing Agents hydrogen peroxide peracids photo-oxidants Softening Agents soaps zeolites silicates citrates Other Ingredients buffers perfumes optical brighteners suds suppressors chelators

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THE INFLUENCE OF FABRICS


Dyes and Fibre
Different fabrics require different types of laundering. Modern fabrics range from basic cottons to high-tech, wrinkle-free, patented blends. In response to constant consumer demand for comfort, low-maintenance, low-cost and versatility, the textile industry produces a very wide range of fabric types - pure fibres as well as blends - and this trend towards diversification is expected to continue. Different dyes may also behave differently in the wash. The "better" dyes and dyeing processes typically result in colours that do not bleed in the wash and fabrics that continue to look good after many wash cycles. The "poorer" dyes and dyeing processes tend to result in colours that fade over time, regardless of the detergent used

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THE IMPORTANCE OF CORRECT DETERGENT DOSAGE


How to Get the Most from Your Detergent
Detergent dosage, or the amount of detergent used, is based on the amount of soil on the laundry and the hardness of the water, not on the amount of water used by the machine. For the best laundry results, it is important to use the right amount of detergent because: Detergents contain ingredients (polymers) that keep soil, once removed from fabrics, in the wash water. If too little detergent is used, the quantity of these ingredients in the wash water will be too small, resulting in laundry that may not be as white or as bright as it should be. Too little detergent may also allow build-up of mineral deposits in the washer from hard water, thereby reducing efficiency and increasing operating costs. Using too much is wasteful and may result in insufficient rinsing, leaving detergent residues on fabrics. Dosage instructions on the container are provided to help consumers determine the correct amount of detergent for a particular wash load. Dosage devices are designed to help consumers measure the recommended dosage. The chart on the left explains the symbols associated with dosage. Keep in mind that certain types of soil, such as sweat and dead skin flakes, are not visible. Use the correct dosage for optimal wash results.

Powders, Tablets, Liquids, Liquitabs : Correct Use Is Vital


Powders and tablets take longer to dissolve than liquids and liquitabs. To ensure maximum performance, powders and tablets should be placed in the dispenser drawer of the washing machine. This keeps them in contact with the water for the longest time possible, ensuring that they dissolve completely and start to work right away. Liquids and liquitabs dissolve much more rapidly than powders and tabs. They can be placed directly into the drum, where they start to work immediately.

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What Is Dirt?
In a simple model, "dirt" can be divided into two categories: Stains: Localized, highly visible Soil: Dispersed, less noticeable Because stains are so visible, the consumer judges cleaning performance mainly based on their removal. Closer investigation of the dispersed soil found on laundry has surprising results. First, there is a lot of hidden soil in our everyday clothes. There are four main sources of such hidden soil, namely: Soil generated by our bodies and the bacteria that live on human skin Soil derived from personal care products such as lotions, creams, deodorants, make-up and hair sprays Soil from our environment, such as from air pollution Textile finishes (softeners, optical brighteners, dye fixatives) and laundry detergent residuals (perfumes, fabric softeners, etc.)

Where Does Dirt Come From?


Soil (or dirt) is generated by various sources, but the largest percentage comes from our bodies. More than 60% of laundry generated at home has been in direct contact with bodies. Each day a person sheds more than a billion skin flakes, generates about a litre of sweat and produces tens of grams of "sebum," a mixture of triglycerides fatty acids, wax esters and cholesterol. The human skin microflora (up to 1.5 million bacteria live on 1 cm2) feed on this organic soil, producing additional and often highly odiferous compounds. An average wash load contains 40 grams of soil, or 3 large spoonfuls. A heavily soiled wash load may contain over 120 grams of soil. Removing all of this soil during a single wash cycle continues to be a challenge to detergent manufacturers and the laundry appliance industry.

What Is Dirt Composed Of?


Dirt extracted from a typical laundry load is complex. It is composed of proteins, starches, carbohydrates, lipids, fatty acids, inorganic salts, clays, pigments and more. The large number of chemically distinct compounds makes soil removal a tough challenge.

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Modern detergents are also complex mixtures of chemicals, many of them specifically designed to attack a certain kind of stain

The Origins of Dirt


Most of the soil on our clothes come from our body (sebum, sweat, etc), not from food stains.

Why fresh laundry makes scents? More than just a smell


The mouth watering smell of a ripe melon, the arousing aroma of coffee, the fresh smell that hangs in the air after a spring shower These are just a few of the 10,000 different smells that people can distinguish. Astonishing as it sounds, compared to our fellow creatures our noses are nothing special. Dogs noses are up to 10,000 times more sensitive than ours. And just the whiff of a single molecule of the female moth pheromone bombykol can captivate any male moth within a mile, sending it fluttering towards her. We do not pay much attention to it, but our sense of smell plays host to a variety of odours every day and gives us important information about the world we live in. We know to avoid rotten food and are alerted to danger by the smell of smoke. Smells give food their flavour. What is more, a long-forgotten smell from childhood can trigger deep emotions in us and conjure up the past in vivid detail. And people can recognise others by their smell mothers can identify their babies and vice versa, and parents can recognise the smell of their children. Dogs are able to pick out individuals according to their smell, though they cannot distinguish

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between identical twins.

Fresh smelling clothes


Scents can create a range of sensations. They can enhance our mood, invigorate us, or calm us. A preference for a certain fragrance reveals something about an individuals identity. All this comes into play when designing washing powders and detergents. Wearing fresh smelling clothes is pleasurable. The right scent can put you at ease or make you feel confident. It also forms part of your identity. Whether you choose a product with a noticeable freshness or a barely traceable fragrance is all part of who you are. Throughout Europe, P&G offers a range of laundry detergents and fabric softeners that caters for all tastes. This is important because a products inherent fragrance also influences the consumers choice. In fact, one-third of consumers sniff products at the shelf before deciding to buy.

People interpret fresh smelling clothes as the sign of a laundry job well done
People connect certain smells to specific functions. This leaves the perfumer with the challenge of matching the right scent to the right product. For instance we associate almond with soft skin whereas lemon is linked to degreasing. And while we accept pine in floor cleaners we reject it in fabric softeners. Some smells we find inherently repulsive even one-day-old babies faces react to the odour of fish and rotten eggs but most of our responses to smells are learned.

Some perfumes are valued all over the world. Others, such as lavender, have particularly strong connotations in certain countries. For instance, the French associate lavender with hot summer vacations in Province whereas in the UK lavender is associated with relaxation, comfort and femininity. Another example is the long established Savon de Marseille soap which is liked a lot by Southern European countries like France and Spain because it reminds them of good old traditions. During the whole laundry process, our nose is more often used than our eyes. Before the wash we use our nose to decide whether a shirt or blouse needs washing; this simply reflects that it is often easier to smell than to see that a garment needs cleaning. And after the wash we smell the garment again to determine whether it is clean. Indeed garments

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laundered in unperfumed detergents are often considered by consumers not to be clean due to the absence of a fresh scent. When it comes to delivering a desirable laundry experience, freshness is essential. Company surveys show that most consumers believe freshness delivered by perfumes on laundry is extremely important or very important

In Southern European countries this is particularly significant (in France and Italy the figure is as high as 90%) but even in Northern Europe (Germany, the U.K., the Netherlands, and Nordic countries), where perfume is typically less important, laundry freshness is still a major consideration (importance varies from 70 to 80%). People interpret fresh-smelling clothes as the sign of a laundry job well done. When you ask consumers what they want in laundry detergents, the resounding answer is longer lasting freshness freshness after washing clothes, after drying and above all in the wardrobe and in-wear. In fact, when clothes dont smell fresh and clean, people feel the need to rewash. Getting clothes to smell right during the different phases of the laundry cycle washing, drying, ironing, storing and in-wear makes the whole job of cleaning clothes much more enjoyable. Doesnt it make you feel so good when sleeping in freshly washed bed linen? A perfumer needs to be able to identify thousands of smells and know how to classify and recognize them. At P&G, most of the perfumers start out as trained chemists who then spend approximately three years learning the art and science behind creating a fragrance. To help them refine their skills, they also spend time training in external perfume houses. P&Gs perfumers need to combine all their skills when designing a product. They have to be able to select and blend the individual notes of the perfume, all at the right level, so that the perfume and the product form a compatible whole that will not degrade. It is no easy task though. So this is where P&G brings in its innovative technologies.

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Turning scent into a freshness experience Creating a freshness experience is more than mastering the art and science of composing unique perfumes. The scent delivered through perfume has to push the right buttons to appeal to consumers and evoke the emotions that fit with their personality. To turn a scent into a real freshness experience the colours, imagery and words selected to define the product have to all fit together and give the consumer the right expectations of the scent behind it. Visuals, colours and words carefully selected to target the group of consumers it is aimed at, convert the scent into a universally understood language. Successful communication of what the scent represents will greatly contribute to the

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perception

of

the

brand,

helping

it

to

stand

out

from

the

crowd.

The sweet smell of success


In line with its philosophy of keeping in close touch with peoples desires, P&G constantly probes people about the sort of fragrance they want on their laundry products. When testing the variants of a fragrance, we ask consumers to smell products directly from the container as well as washed items. What did they think of their intensity, their character? P&G then goes further, inviting people to use new detergents in their homes. How does the fragrance perform over the wash cycle? What is it people want from laundry detergents and fabric softeners? Careful listening is one step on the path to designing the perfect perfume.

Consumers feel that the freshness factor drops with each stage in the laundrycycle
Time and again, consumers say that what they want is more staying power for the fresh smell on fabrics. Consumers feel that the freshness factor drops with each stage in the laundry cycle. Ideally they want the fragrance to keep on working, especially at two key points or moments of truth when storing clothes and when wearing them. A wardrobe full of fresh-smelling clothes is enjoyable. Wearing such clothes boosts confidence and

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gives pleasure. Getting the ingredients to keep working in our clothes after drying and in-wear is a tricky challenge for our perfumers. This depends on the ingredients staying power. For instance, how well does it withstand heat and water plus detergent, or sunlight if hung outside to dry will it dissolve away or evaporate? When clothes are washed, water and detergent carry away the more soluble parts of the fragrance, and when clothes are dried perfume ingredients evaporate. In conventional perfumes, this mainly leaves some of the heavier ingredients (the base notes) on the fabric, giving the clothes their traditional fresh smell. The challenge at P&G is to extend the range of perfume ingredients that stay longer on the fabric leaving a noticeable fresh scent. Traditionally, higher levels of perfume were used in the laundry detergent to boost freshness on dry clothes. The downside was that the scent of the detergent itself became too strong and turned people off. This led to the search for more balanced compositions that made the level of fresh smell pleasant during all stages of the laundry process. One exciting development is pro-perfumes. The pro-perfume technology works like an anchor that retains the perfume that is otherwise washed off the fabrics. The freshness releases slowly over time and magically materialises on your clothes when it is needed. Researchers are currently extending the range of freshness characters delivered by properfumes. In just 10 years P&G has filed more than 100 perfume patents, many of them relating to the delivery of longer lasting freshness on dry laundry. Another breakthrough in perfume delivery is controlled freshness release via encapsulation of substantive perfume particles. Here the freshness is locked up in microcapsules that slowly dissolve in the wash, releasing it on damp and dry laundry.

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Recently, P&G also created a fabric softener, Lenor Stayfresh, which helps to neutralise unpleasant smells. The key ingredient, cyclodextrin, works by hooking up with unpleasant odour molecules and deactivating them. This technique was first used in Fbrze, a spray used for eliminating bad odours on fabrics. By getting rid of unpleasant smells, Lenor Stayfresh helps clothes keep their just-washed fragrance and delivers real in-wear freshness.

HISTORY OF THE BRAND (India)


In 1993, Procter & Gamble Home Products is incorporated as a 100% subsidiary of The Procter & Gamble Company, USA. Procter & Gamble Home Products launches Ariel Super Soaker. In 1993, Procter & Gamble India divests the Detergents business to Procter & Gamble Home Products In 2000, Procter & Gamble Home Products introduced Tide Detergent Powder - the largest selling detergent in the world. In August 2000, Procter & Gamble Home Products Limited launched New Ariel Power Compact detergent with a new global technology that breathes new life into clothes, by removing dinginess from them and restoring the original colors of the fabric, by detecting and removing deposits which are left behind from successive washes

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In January 2001, Procter & Gamble Home Products Limited and Whirlpool India Ltd. launched a special 'Ariel - Whirlpool Superwash' offer, making washing machines more affordable to the people of Hyderabad. On purchase of either a 500gms, 1kg or 1.5kg economy pack of New Ariel Power Compact, consumers are automatically eligible to buy a Whirlpool Washing Machine for as low as Rs.238/- in Equal Monthly Installments for 24 months, by filling in the application form that comes with the Ariel pack and contacting any one of the Whirlpool dealers mentioned on the pack. In July 2001, Procter & Gamble Home Products Limited launched New Ariel Total Compact with Magicare a New System of Washing that completely removes stains without scrubbing, significantly reducing time spent on washing clothes. In April 2002, Procter & Gamble Home Products Limited announced the launch of a special Ariel Bar Refund Offer along with its new Advanced Ariel Compact. Under the Ariel Bar Refund Offer, consumers could exchange their detergent bar on purchase of Advanced Ariel Compacts 1kg and 500gms packs, and avail of a Rs.15 and Rs.7 discount respectively on MRP In March 2004, Procter & Gamble Home Products Limited reduced the prices of Ariel and Tide bags (large packs) by 20-50%, while maintaining the superior quality. The superior quality one kg pack of Tide now cleans a familys one month laundry in just Rs.23/-, while a one kg pack of Ariel cleans a familys one month laundry in just Rs.50/-.

OUTLINE OF THE COMPANY


PROCTER & GAMBLE

TYPE

PUBLIC

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FOUNDED

1837

HEADQUARTERS

MUMBAI, INDIA

MR SHANTANU KHOSLA, MANAGING DIRECTOR KEY PEOPLE MR. SHAILESH JEJURIKAR


MARKETING DIRECTOR

INDUSTRY

FMCG DETERGENT POWDER , DETERGENT CAKE, SHAMPOO, DIPERS, NAPKINS,

PRODUCTS

PARENT WEBSITE

P&G www.pg.com

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PRODUCT COMPLETE RANGE ARIEL FAMILY

1.

Ariel Biological

2.

Ariel Colour & Style

3.

Ariel Sensitive

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4.

Ariel Stain Pen

5.

Ariel Handwash

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Price List

Ariel 1. Ariel fresh clean 2.Ariel front o mat

Quantity 500g 1000g 1000g 500g

Price 55/107/155/70/2/-

3.Ariel ultra whitening 4.Ariel pouches

20g

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Market Strategy of Ariel (India)


Fragrance
Ever wished that your clothes could smell mesmerizing and fragrant like your perfumes? Procter & Gamble, the makers of leading international fragrances such as Hugo Boss, Lacoste, Old Spice and Valentino now make your wish come true, with the launch of Ariel in a choice of two exciting fragrances Ariel Spring Clean with a floral fragrance, and Ariel Fresh Clean with a refreshing fragrance. The two unique fragrances of Ariel now offers Indian consumers an unbeatable combination of superior cleaning and a choice of fragrances with the launch of Ariel Spring Clean and Ariel Fresh Clean. Superior cleaning in a choice of Two Fragrances Ariel Spring Clean & Ariel Fresh Clean Another Breakthrough Innovation from Ariel for the Indian Family

Traditionally, higher levels of perfume were used in the laundry detergent to boost freshness on dry clothes. The downside was that the scent of the detergent itself became too strong and turned people off. This led to the search for more balanced compositions that made the level of fresh smell pleasant during all stages of the laundry process. One exciting development is pro-perfumes. The pro-perfume technology works like an anchor that retains the perfume that is otherwise washed off the fabrics. The freshness releases slowly over time and magically materialises on your clothes when it is needed. Researchers are currently extending the range of freshness characters delivered by properfumes. In just 10 years P&G has filed more than 100 perfume patents, many of them relating to the delivery of longer lasting freshness on dry laundry.

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Coffee/Tea

Soak in Ariel for atleast 30 minutes. Then wash as usual using warmest water safe for the fabric
Dirt/Mud

When dry, brush off as much as possible. Rinse under cold running water. Treat with the Ariel solution and wash as usual.

Prespiration Soak in Ariel solution for atleast 30 minutes. Then wash as usual. Grease/Oil Treat with Ariel Magicare. Then wash as you normally do. Blood If stain is fresh, rinse in cold water, for dried stains first scrape off as much as you can, then soak in warm water with Ariel for at least one hour. Chocolate Sponge with water before washing Urine/Vomit/Mucus/Stool Rinse in running water, then soak in Ariel solution for atleast one hour. Wash as usual Collar & Cuff Dirt Treat with Ariel Magicare. Then wash as usual. White/Dingy Socks Soak in Ariel for atleast 30 minutes. If dirt still persists on toes and heels, treat this with Magicare, then wash as usual.

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Market Competition
Saas-bahu fights are the root cause of most tensions in Indias joint family system. In the 1990s, this battle from the home transgressed into the corporate board rooms of two families, viz Procter & Gamble and Hindustan Lever Ltd. The products at stake were Ariel and Surf. It began with advertising wars featuring the saas and the bahu, an argument that Indians would love to overhear, especially if the protagonists are our neighbours saas and bahu! Ariel came up with an ad that showed the mother-in-law supporting the old method of washing (an indirect hit on Surf and Rin, which are older brands as compared to Ariel), while the smart bahu stressed the zero labour, high output value of a compact detergent, read, Ariel. Ariel had taken the smart way and soon became popular! Not to be outdone, Hindustan Lever's Surf Ultra promised the housewife something irresistible a wash which guaranteed no trace of stains. Dhoondte reh jaoge was soon the catch line on everyones lips and the company managed to literally sweep its competitor into oblivion. Everybody was soon looking for Surf Ultra and not Ariel in the neighbourhood mom-and-pop stores. Then Ariel began hunting for a promise which would exceed that of Surf. It launched Ariel Microshine, which had mysterious enzymes that offered "100% more stain fighters". Not far behind, Surf, too, launched Wash Boosters, which promised "the best clean under toughest conditions". If that was not enough, Ariel was out with Ariel Super Soakers soon enough, and Surf launched the Surf Ultra with enzymes. By this time the consumer was completely confused and exhausted trying to remember the chemical compositions of the two detergents. The two detergents were seemingly fighting out a media war over the same issue of who cleans better and faster. The consequence: brand loyalty started declining and tactics were immediately changed. Even as Hindustan Lever Ltd (HLL) and Procter & Gamble (P&G) continue to jostle for consumer attention, its the desi Nirma which reigns as the number one household care brand in the country. Used by 689 lakh households, Nirmas position, as expected, is established by its strong presence in rural (519 lakh households) as against 170 lakh urban, reveals a study conducted by Hansa Research for Indian Readership Survey 2005. Detergent brands HLLs Surf and P&Gs Ariel which fought a bitter price war battle last year stand at No 8 and No 9 respectively, the study listing the top 10 brands in the category said. Competition not only boost the innovation but also it derives the demand and price control. For example, in India the detergent brands like Tide, Surf Excel, Ariel were in dominant position and their detergent product were almost at the same cost of about Rs 55 ($1.2)per 500 gm but in 2004 the prices droped to almost Rs. 24 ($ 0.6) per 500gm and still the companies were earning huge pofits, good advertisements were as usual. So, all these players did some cost cuttings in manufacturing, schemes to compete with each other.

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Tide : Neat strategy


Brand : Tide Company:P&G Agency; Leo Burnett Tide is the largest selling detergent brand of P&G worldwide. Tide was launched with much fanfare in 2000. Indian detergent industry is estimated to be around Rs5000 crore and is dominated by the marketing giant HLL. P& G although was in the Indian market for a long time was not a serious player in the detergent market. But when the Indian market opened up and the economy began to prosper, P&G could not resist entering the Indian marketin a big way. As always MNCs are too proud of their brands that they want a premium from the consumers. Here also ,Tide was launched as a premium brand and as usual got a luke warm response from the value conscious Indian consumers. P&G had to settle with a miniscule 8 % of the detergent market. Then came 2003 and the price war started and now there is no premium brands in the detergent market in India. The price war enabled P&G to popularize the brand and increase the penetration. Although HLL and P&G did not increase their marketshare because of the price cut, the overall market size increased because the regional players lost their share to these giants. P&G had a serious problem after the price cut because there was a chance of cannibalizing between Ariel and Tide because there was no significant differentiation between the two brands.

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Now Tide has found its formula, the same global positioning as a Detergent that cleans perfectly. So Tide has now highlighting its which has the The campaigns defend Rin. Through the new strategy Tide aims to capture the safedi segment while Ariel will fight Surf in the Color segment. A marketing fight worth watching.... using whiteness ( safedi) as a base unleashed the campaign whitening power against HLL's Rin same positioning. has a desi touch and well executed.

The pricing is competitive and hence HLL is forced to rope in none other than Big B to

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Industrial size
For knowing the industrial size we have to focus on the following questions

1. Growth rate of FMCG sector 2. Growth rate of P&G


1. Prices of daily utility items like soaps,detergents and shampoos are set to see an increase, with FMCG companies mulling over further hikes in the ongoing quarter, mainly on account of rising input costs. Already major companies like Godrej Consumer Products, HLL and P&G home products Ltd have announced price hikes of their soaps, detergents and shampoo products. Improving consumer sentiment across Indias urban and rural markets have fired up growth rates in the fast moving consumer goods (FMCG) market. Senior industry officials said theres a sharp reversal in downtrading, and profit margins have improved substantially with consumers seeking value-added and aspirational products. For August 05, the total FMCG market grew by a strong 6.2% in value terms. Reflecting the consumer confidence, the FMCG index has moved up by 37% over the past six months, even marginally outperforming the BSE sensex. Most companies are expected to post strong growth in sales with some analysts expecting giants like HLL to post double digit sales growth. In fact, HLL, which has been criticised for years for its performance, may at least be able to convince doubters about its sales potential though its profitability may still be under some strain. Toilet soaps grew by 4.7%, biscuits by 13.9%, washing powder and liquid detergents by 8%, toothpaste by 4,4% and skin creams grew by 7.5%. CK Ranganathan, CMD of CavinKare told ET that demand has picked up across markets with the rural sector showing a rebound in recent weeks. Demand has not only picked up sharply, theres an upswing across categories too he said. Industry sources said the jump in volumes despite prices hikes by leading players in some categories displayed a strong consumer confidence in the market. The FMCG industry is seeing a resurgence in growth as demand picks up and companies play the price-value game more sensibly. This comes in the backdrop of an inflationary raw material price trend, putting pressure on costs which has had a welcome, though unintended, effect of curbing freebies. Most companies have also been protected from the rising cost scenario due to their presence in the tax havens of Himachal Pradesh and Uttaranchal.

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Adi Godrej, CMD of Godrej Consumer Products said, Our business segments delivered healthy results making us the second largest toilet soaps player in the country. The FMCG segment is witnessing a healthy demand growth. Clarity on VAT has enabled us to further enhance sales, he said. Companies are offering buyers better choices, paying attention to quality and the pricevalue equation. Most are paying attention to the demand for higher-end products in segments like personal care. These segments can let companies focus on the mass end for volume and top end for margins. Demand for high-value products and higher fiscal benefits from investments in tax exempt locations in an upbeat market has clearly helped companies tone up sales growth. We expect top companies to record double-digit growth rates for the next few quarters, said an analyst at ICICI Securities. For the quarter ended September 05, the effect of setting up units in tax havens will be more pronounced as more companies have set up units here. The effect of higher petrobased intermediates will be visible on bottom lines, though softer edible oil prices will provide some relief.

2. GROWTH RATE OF P&G

FINANCIAL RESULTS
(Figures in Rs. Crores) Sales (less excise duty) Profit before tax Profit after tax Proposed Dividend Transfer to General Reserve Balance carried forward 2004/2005 684.9 177.8 124.6 129.8 12.5 45.8 2003/2004 577.2 127.2 92.2 64.9 9.2 81.7

Report are presenting outstanding financial results of the company for the year ended june 30, 2005. The sales of rs. 684.92 crores (rs. 577.24 crores) were up by 19%. Our core business grew by 8% and contract manufacturing business grew by 48%. Profits before tax (pbt) at rs. 177.79 crores (rs. 127.17 crores) were up by 40%. Profits after tax (pat) at rs. 124.61 crores (rs. 92.17 crores) were up by 35%. Impressive growth in pbt and pat were driven by better margins on core business and also by one time items like reversal of provisions no longer required, asset sale and higher interest income during the year under review. Without one time items, pbt grew by 19% and pat by 13.5%, which is

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impressive in equal measure. Apart from continued focus on strong consumer based marketing and product Initiative programs developed to delight our consumers, this years performance has been driven by renewed efforts to win at the first moment of truth - the critical moment at the retail outlet when the shopper makes the choice to buy our brands. We have made ignificant advance in bringing world class technology and methods to bear to truly understand the dynamics in the indian market place at the first moment of truth. Beyond leveraging our unique distribution infrastructure to drive wider and deeper distribution, this approach has focused on the quality of distribution based on a deep understanding of shopper behavior in store. This has enabled us to design programs across our brands that provide a competitive advantage and influence the shoppers purchase decision by using the retailer as a key partner. This has led to significantly more effective and efficient programs that have been a key driver of our strong results across all channels.

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Building New Market


1. Procter and Gamble India on Wednesday launched its Ariel sachet priced at Rs 2 and Tide sachet at Re 1 for the first time in the State here. Mr K. Pardhasaradhi, sales manager (AP), said the two brands put together had a 10 per cent share in the detergents market in the country and large masses of consumers at the lower end of the market could now buy these products at reduced prices in the sachet form. The prices of larger packs of these two detergents would, however, remain the same. He said Andhra Pradesh was an important market for both the brands and the company was hoping to boost the sales of Ariel and Tide substantially in the State with the launch of sachets. Ariel was known for stain removal and Tide for whiteness and each sachet can clean up to 12-15 clothes.

2. Enzyme-based detergents also known as green chemicals find a wide range of applications in laundry, dishwashing, textile and other such industries. The enzyme preparations like proteases, amylases, lipases and cellulases are considered as indispensable ingredients in these detergents. These components account for the major portion of the market for various cleaning applications. The cleaning ability of these formulations is mainly due to the synergistic action exhibited by the different detergent ingredients and the enzyme-preparations. Nowadays, the use of enzyme-based detergents is preferred over the conventional synthetic ones in view of their better cleaning properties, performance with respect to lowering of washing temperatures and the alleviation of pollution. This aspect is more relevant to India in view of the rapid population explosion and industrialization taking place now.

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Pricing of Ariel
There's good news for families struggling to maintain the monthly budget. Procter & Gamble has announced a reduction in prices of Ariel and bags (large packs) by 20-50%. 'The superior quality kg pack of Tide now cleans a familys one month laundry in just Rs. 23/-, while a kg pack of Ariel cleans a familys 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 and superior stainremoval from Ariel in every wash, said J P Kuehwlein, Brand Manager Fabric & Home Care, ASEAN-Australasia-India, P&G, in Chennai on March 4, 2004. The new prices of Ariel are as follows: Pack Size Old Price Ariel New Price Ariel 200gm Rs. 30 Rs. 22 500gm Rs. 70 Rs. 50 1kg Rs. 135 Rs. 99 1.5kg Rs. 180 Rs. 145

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wt. Average Strategy: - Ariel ultra whitening Premium Strategy: - Ariel Front o Mat Good-value Strategy: - Ariel Fresh Clean 500gm 1000gm 500gm

price 55/155/70/-

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P&G'S SUPPLY CHAIN

Optimize has an article by Larry Kellam. the director of supply-network innovation at Procter & Gamble: "At Procter & Gamble, we're working toward a vision we call 'the consumer-driven supply network.' That differs from our supply-chain strategy of the past in two significant ways: It puts the consumer first, and it envisions a network rather than a chain. All the work we've done until now to improve our supply chain focused on the supplier first?which means we've been applying a cost mentality to the problem. Now, we're putting the emphasis on serving the consumer. And whereas a chain connotes handoffs and time delays, the consumer-driven network will operate with real-time data and all network participants working to add value for the consumer." The five elements of the supply chain discussed are: 1. 2. 3. 4. 5. REAL-TIME DEMAND INFORMATION, COLLABORATIVE PLANNING, PRODUCE-TO-DEMAND MANUFACTURING SYSTEM, DYNAMIC REPLENISHMENT DISTRIBUTION AND THE CONSUMER-DRIVEN SUPPLY NETWORK.

Prices of daily utility items like soaps, detergents and shampoos are set to see an increase, with FMCG companies mulling over further hikes in the ongoing quarter, mainly on account of rising input costs. Already major companies like Godrej Consumer Products, HLL and P&G home products Ltd have announced price hikes of their soaps, detergents and shampoo products.

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Promotion
Promotion is a form of corporate communication that uses various methods to reach a targeted audience with a certain message in order to achieve specific organizational Objectives. Nearly all organizations, whether for-profit or not-for-profit, in all types of industries, must engage in some form of promotion. Such efforts may range from multinational firms spending large sums on securing high-profile celebrities to serve as corporate spokespersons to the owner of a one-person enterprise passing out business cards at a local businesspersons meeting. Like most marketing decisions, an effective promotional strategy requires the marketer understand how promotion fits with other pieces of the marketing puzzle (e.g., product, distribution, pricing, target markets). Consequently, promotion decisions should be made with an appreciation for how it affects other areas of the company. For instance, running a major advertising campaign for a new product without first assuring there will be enough inventory to meet potential demand generated by the advertising would certainly not go over well with the companys production department (not to mention other key company executives). Thus, marketers should not work in a vacuum when making promotion decisions. Rather, the overall success of a promotional strategy requires input from others in impacted functional areas.

PROMOTIONAL PROGRAM 1. 2. 3. 4. 5. ADVERTISING PERSONNEL SELLING SALES PROMOTION PUBLICITY DIRECT MARKETING

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The advertising expenditure of P&G is far behind the main competitor as given in the following table India's leading advertisers in 2005 by media spend were: Hindustan Lever ($99m) Maruti Udyog (Suzuki) ($27m) Pepsico ($27m) LG Electronics ($25m) Procter & Gamble ($25m) Dabur India ($24m) Bajaj Auto ($24m) Hero Honda ($23m) Nokia ($22m) Paras Pharmaceuticals ($22m)

POPULAR ADVERTISEMENTS OF ARIEL

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Actress Sharmila Tagore with aroma therapist Blossom Kochhar at the launch of new Ariel Spring Clean and Ariel Fresh Clean detergents in New Delhi

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SWOT ANALYSIS
STRENGTH strong brand equity distinct line of product distribution network advertising unlimited user group OPPORTUNITY rural markets unexplored, have lots of potential. Can work on other aspects of the products. Collaborate with washing machine company

WEAKNESS focus on only one aspect of the product focus on the quality of product not on pricing

THREATS HLL (SURF DETERGENT) Changes of the preference of the consumer. Aggressive strategy of the competitors.

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Environmental analysis
Within the last 15 years our lives have become more hectic than ever. We now access global information at the touch of a button, keep our mobile phones handy for any eventuality, and as consumers, we have become accustomed to the get-it-now life style. Our detergents have also kept up with this trend. The last decade and a half has seen the move from the traditional big-box laundry detergents, to the compact versions, and the most recent innovation, unit dose systems. In earlier studies we showed that when the compact powders of 1998 were compared to the regular powders of 1988, there was a 50% decrease in overall environmental impact. The unit dose systems were introduced in powdered tablets form in 1999, and the liquid unit dose systems came onto the market in 2001. Those detergents let you toss a sachet or tablet into the wash with the correct dosage, simply dissolving into the water without the bother of measurements and spillage? With these innovative products becoming a large part of our busy lifestyle, there are still many questions about these products. We can ask ourselves; Are compact detergents still the best option from an environmental perspective? What about these new forms of detergents like the liquid sachets and tablets? What impact do they
have on the environment compared to other detergent types?

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How can we asses environmental impact? Use Life Cycle Assessment (LCA)!
We conducted a Life Cycle Assessment (LCA) by comparing the environmental profiles of 5 types of laundry detergents from the Ariel brand marketed in 2001 in the United Kingdom (regular powder, compact powder, powder tablets, compact liquid, and liquid unit dose systems or sachets), throughout their entire life cycle (cradle to grave). The life cycle stages we looked at were: manufacturing of the ingredients, product formulation, packaging, distribution from the P&G plant to retailers, consumer use, and disposal via the sewage water treatment plant. For each detergent type we chose the size and packaging with the largest market share and considered one wash cycle using recommended dosage.

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Compacts What did the LCA tell us? The short answer is that environmentally speaking, both the liquid and powder compact detergents are still better. We saw reductions on total energy consumption, CO2 emission and solid waste for compact powders and compact liquids. This is because they use the least amount of chemicals when we compared them to todays regular powders. We should add however, even with the differences we found, no detergent really outperformed each other. 4

The classification process is done in four steps. First, the highest and lowest value is determined for each parameter. Second, the middle value (MV) is calculated by taking the average from both values. Third, a lower limit value (LLV) is calculated as 80% of the MV. Similarly, a higher limit value (HLV) is calculated by adding 20% to the MV. Fourth, all parameters are compared to the LLV and HLV. Numbers equal or below the LLV are classified as L, numbers equal or greater than the HLV classified as H and all other values are classified M.

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The benefit of this presentation is that it is very meticulous, since it takes only the extreme values to calculate the MV, LLV and HLV. In a table format, it allows for a quick evaluation of strengths and weaknesses for each parameter and product variant. For LCA studies, this is extremely helpful given the number of parameters and product variants. However, the weakness of this presentation is that results are transferred from a continuous scale to a discrete system with 3 classes and working with an arbitrary cut-off rule of 20% vs. the MV. As a consequence, it is impossible to discriminate between large and extremely large differences.

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STP ANALYSIS
(SEGMENTATION TARGET POSITIONING)
Market segmentation is the process in marketing of dividing a market into distinct subsets (segments) that behave in the same way or have similar needs. Because each segment is fairly homogeneous in their needs and attitudes, they are likely to respond similarly to a given marketing strategy. That is, they are likely to have similar feeling and ideas about a marketing mix comprised of a given product or service, sold at a given price, distributed in a certain way, and promoted in a certain way. Broadly, markets can be divided according to a number of general criteria, such as by industry or public versus private sector. Small segments are often termed niche markets or specialty markets. However, all segments fall into either consumer or industrial markets. Although it has similar objectives and it overlaps with consumer markets in many ways, the process of Industrial market segmentation is quite different. The process of segmentation is distinct from targeting (choosing which segments to address) and positioning (designing an appropriate marketing mix for each segment). The overall intent is to identify groups of similar customers and potential customers; to prioritize the groups to address; to understand their behavior; and to respond with appropriate marketing strategies that satisfy the different preferences of each chosen segment. There are following major Segmentation variables: Geographic variables o region of the world or country, East, West, South, North, Central, coastal, hilly, etc. o country size/country size : Metropolitan Cities, small cities, towns. o Density of Area Urban, Semi-urban, Rural. o climate Hot, Cold, Humid, Rainy. Demographic variables o age o gender Male and Female o sexual orientation

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o family size o family life cycle o Education Primary, High School, Secondary, College, Universities. o income Under Rs.20,000, Rs.20,000 to Rs.39,999, Rs.40,000 or over

o occupation o education o socioeconomic status o religion o nationality/race o language o Generation Psychographic variables o personality o Perception o life style o value o attitude Favorable or unfavorable attitudes

Behavioral variables o benefit sought Economic, functional, physiological, social, and more detailed needs o product usage rate o brand loyalty Favorable and ongoing; intermittent; none; bad relationship

o product end use o Brand familiarity Insistence, preference, recognition; no recognition; rejection

o readiness-to-buy stage o decision making unit

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SEGEMENTATION PROFILE FOR ARIEL


Geographic variables o Metropolitan Cities, small cities, towns. Demographic variables o age o gender Male and Female o family size o Education Primary, High School, Secondary, College, Universities. o income Under Rs.20,000, Rs.20,000 to Rs.39,999, Rs.40,000 or over

o occupation o education o socioeconomic status o Generation Psychographic variables o personality o Perception o life style

status seekers , culture oriented


o value o attitude Favorable or unfavorable attitudes

Behavioral variables o benefit sought Economic, functional, physiological, social, and more detailed needs o product usage rate o brand loyalty 49

Favorable and ongoing; intermittent; none; bad relationship

o product end use o Brand familiarity Insistence, preference, recognition; no recognition; rejection

o readiness-to-buy stage o decision making unit

Geographic Segmentation
Region: major metropolitan town.

Demographic Segmentation
Age: young & middle, till fifty Sex : male and female but mostly female Education : high school graduate, some College, college graduate, postgraduate Occupation : homemakers and professional

PSYCHOLOGICAL /PSYCHOGRAPHIC
Needs-Motivation: care, hygiene, care of clothes and hand, stain removals Personality: non misers, time conscious Psychographic (Lifestyle): status seekers, time constrained.

SOCIOCULTURAL SEGMENTATION
Social Class: upper-lower, middle, upper Family Lifestyle: accept changes, e.g. move over long used nirma etc.

USE-RELATED SEGMENTATION
Usage Rate: heavy users Awareness Status: aware Brand Loyalty: high

USE-SITUATIONAL SEGMENTATION
Objective ; clean clothes , freshness, stain removals Location : home. Person : self.

Benefit required : value for money .


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Demographic Psychographic Profile : striver .

BIBLIOGRAPHY

The sources which we consulted and made this project are as follows:
INTERNET SITES: www.pg-india.com www.domain-b.com RETAIL OUTLETS: Mahajan Departmental store Small retail outlets in Sarita vihar Small retail outlets in sector 27 NOIDA BOOKS CONSULTED: Marketing management by Philip kotlar

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