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CRM of P&G
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CUSTOMER RELATIONSHIP MANAGEMENT AND THE P&G GILLETE OFFERING
ACKNOWLEDGEMENT
I express my sincere gratitude to my faculty guide Mrs.Roli Raghuvanshi,lecturer, Amity
school of busness, for his/her able guidance, continuous support and cooperation
throughout my project, without which the present work would not have been possible.
I would also like to thank the entire team of P AND G STAFF, for the constant support
and help in the successful completion of my project.
1
CONTENT
S.NO. TOPIC PAGE NO.
1. ACKNOWLEDGEMENT..................................................................................1
2. EXECUTIVE SUMMARY................................................................................3
3. INTRODUCTION..............................................................................................5
4. INDUSTRY INTRODUCTION.......................................................................41
5. OVERVIEW OF FMCG SECTOR IN INDIA..............................42
6. COMPANY PROFILE.....................................................................................46
7. RESEARCH METHODOLOGY & OBJECTIVE ..........................................69
8. FINDING & ANALYSIS.................................................................................74
9. CONCLUSION................................................................................................82
10. RECOMMENDATION....................................................................................84
11. FUTURE PROSPECTS...................................................................................85
12. BIBLIOGRAPHY............................................................................................86
13. QUESTIONNAIRE..........................................................................................87
2
EXECUTIVE SUMMARY
Before we begin to examine the conceptual foundations of CRM, it will be useful to
define what is CRM. A narrow perspective of customer relationship management is
database marketing emphasizing the promotional aspects of marketing linked to database
efforts.
Another narrow, yet relevant, viewpoint is to consider CRM only as customer retention in
which a variety of after marketing tactics is used for customer bonding or staying in
touch after the sale is made.
Shani and Chalasani define relationship marketing as “an integrated effort to identify,
maintain, and build up a network with individuals consumers and to continuously
strengthen the network for mutual benefit of both sides, through interactive,
individualized and value-added contacts over a period of time”.
The core theme of all CRM and relationship marketing perspectives is its focus on co-
operative and collaborative relationships between the firm and its customers, and/or other
marketing actors.
CRM is based on the premise that, by having a better understanding of the customers’
needs and desires we can keep them longer and sell more to them.
Growth Strategies International (GSI) performed a statistical analysis of Customer
satisfaction data encompassing the findings of over 20,000 customer surveys conducted
in 40 countries by Infoquest.
The conclusions of the study were:
A Totally Satisfied Customer contributes 2.6 times as much revenue to a company as
a Somewhat Satisfied Customer.
A Totally Satisfied Customer contributes 17 times as much revenue as a Somewhat
Dissatisfied Customer.
3
A Totally Dissatisfied customer decreases revenue at a rate equal to 1.8 times what a
Totally Satisfied Customer contributes to a business.
By reducing customer defection (by as little as 5%) will result in increase in profits
by 25% to 85% depending from industry to industry.
An important facet of CRM is “customer selectivity”. As several research studies have
shown not all customers are equally profitable (Infact in some cases 80% of the sales
come through 20% of the customers). The company must therefore be selective and
tailor its program and marketing efforts by segmenting and selecting appropriate
customers for individual marketing programs. In some cases, it could even lead to “
outsourcing of some customers” so that a company better utilize its resources on those
customers it can serve better and create mutual value. However, the objective of a
company is not to really prune its customer base but to identify appropriate customer
programs and methods that would be profitable and create value for the firm and the
customer. Hence, CRM is defined as:
4
INTRODUCTION
Differentiate Customers: All customers are not equal; recognize and reward best
customers disproportionately. Understanding each customer becomes particularly
important. And the same customers’ reaction to a cellular company operator may be quite
different as compared to a car dealer. Besides for the same product or the service not all
customers can be treated alike and CRM needs to differentiate between a high value
customer and a low value customer.
What CRM needs to understand while differentiating customers is:
- Sensitivities, Tastes, Preferences and Personalities
- Lifestyle and age
- Culture Background and education
- Physical and psychological characteristics
Differentiating Offerings
Low value customer requiring high value customer offerings
Low value customer with potential to become high value in near future
High value customer requiring high value service
High value customer requiring low value service
5
High
Low
Low HighCustomer Value
Keeping Existing Customers
Grading customers from very satisfied to very disappointed should help the organisation
in improving its customer satisfaction levels and scores. As the satisfaction level for each
customer improve so shall the customer retention with the organisation.
Maximizing Life time value
Exploit up-selling and cross-selling potential. By identifying life stage and life event
trigger points by customer, marketers can maximize share of purchase potential . Thus the
single adults shall require a new car stereo and as he grows into a married couple his
needs grow into appliances.
Increase Loyalty
Loyal customers are more profitable. Any company will like its mindshare status to
improve from being a suspect to being an advocate.
6
Low value customers who
require high levels of service
must either purchase the higher level of service or become our competitors low value/high cost customers
Low value customers who
require high levels of service
must either purchase the higher level of service or become our competitors low value/high cost customers
Service R
equ
iremen
t
High value customers who require a high level of service are maintained without expanding the costly offering to the entire customer population
High value customers who require a high level of service are maintained without expanding the costly offering to the entire customer population
Fig. Customer value – Service Matrix
High
Low
*Focus On Short Term Profitability.Spend Minimum Energy To Meet Your Objectives.
#Don’t Pursue.Use Opportunity As It Comes.Short Term Acquisition Shouldn’t AffectLong Term Image.
*Very cautious decision needed. Re-examine business Plan & Strategy. Evaluate That Your Loss (i.e. Your competitor’s gain) Doesn’t become nightmare for you.
#Needs In-depth strategic review as acquisition alone and dissatisfaction later could be more harmful
Low High
Company has to invest in terms of its product and service offerings to its customers. It
has to innovate and meet the very needs of its clients/ customers so that they remain as
advocates on the loyalty curve. Referral sales invariably are low cost high margin sales.
(Fig. Categorizing Customers)
Summarizing CRM activities:
The CRM cycle can be briefly described as follows:
1. Learning from customers and prospects, (having in depth knowledge of customer)
2. Creating value for customers and prospects
3. Creating loyalty
4. Acquiring new customers
5. Creating profits
6. Acquiring new customers
71
Creating value for customers & prospects
2Creating loyal customers
3
Acquiring new customers
4
5
Creating Profits
Learning from customers a& prospects
Fig. CRM Activities
*You have No Choice But To Handle Them Very Carefully.Will Consume Energy
# Think Of Innovative Ways of Getting them On Your Side, But The ‘Cost Of Acquisition’ Must Be Controlled
Strategic Importance To Your Business Plan
*Cultivate Relationship.Spend Energy.Go Out Of Your Way.
#Think Of Strategies TO Move Them Away From Competition.Will Consume Disproportionately High Energy.
Relationship & Profitability Potential
*Existing Customers
#Potential Customers
The Emergence of CRM Practice
The Past:
Looking back at a snapshot history of marketing, we can see the following clear
developments and progression over the last four decades:
1960’s – the era of Mass Marketing, when Gibbs SR toothpaste began the first
marketing of this kind with its black and white campaign.
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Customer Retentionand referrals for new
customers
Customer NeedAssessment & Acquisition
Customer Developmentthrough personalizationand customization
Customer Equity Leverage through Cross Selling and Up Selling
Figure Customer Life Cycle Management
1970’s – saw the beginning of segmentation, direct mail campaigns and early
telemarketing (such as publishing)
1980’s – where Niche marketing made millionaires of those who were best at it.
1990’s – Relationship Marketing. The explosion of telemarketing and call centres, all
set up to develop relationships with customers. The recognition of the true value of
retention and the use of Lifetime Value as a business case.
In addition to this, a number of key marketing concepts can also be used to see where
CRM has developed from:
Satisfying Needs, Customer Orientation
The organisation needs to be arranged so that all functions contribute
Profit must be the consequence of delighting customers (Kotler)
Developing customer relationship has historical antecedents going back into the pre
industrial era. Similarly artisans often developed customized produce for each customer.
Such direct interaction led to relational bonding between the producer and the consumer.
It was only after industrial era’s mass production society and the advent of the
middlemen that there were less frequent interactions between producers and the
consumers leading to transactions oriented marketing. The production and consumption
factions got separated leading to marketing functions being performed by the middle men
and middlemen are in general oriented towards the economic aspects of buying since the
largest cost is often the cost of goods sold.
In recent years however, several factors have contributed to the rapid development and
evolution of CRM. These include: -
1. The growing de-intermediation process in many industries due to the advent of
sophisticated computer and telecommunication technologies that allow producers to
directly interact with end-customers. For example, in many industries such as
airlines, banks insurance, software or household appliances and even consumables,
the de-intermediation process is fast changing the nature of marketing and
consequently making relationship marketing more popular. Databases and direct
marketing tools give them the means to individualize their marketing efforts.
9
2. Advances in information technology, networking and manufacturing technology have
helped companies to quickly match competition. As a result product quality and cost
are no longer significant competitive advantages.
3. The growth in service economy. Since services are typically produced and delivered
at the same institution, it minimizes the role of the middlemen.
4. Another force driving the adoption of CRM has been the total quality movement.
When companies embraced TQM it became necessary to involve customers and
suppliers in implementing the program at all levels of the value chain. This needed
close working relationships with the customers. Thus several companies such as
Motorola, IBM, General Motors, Xerox, Ford, Toyota, etc formed partnering relations
with suppliers and customers to practice TQM. Other programs such as JIT and MRP
also made use of interdependent relationships between suppliers and customers.
5. Customer expectations are changing almost on a daily basis. Newly Empowered
customers who choose how to communicate with the companies across various
available channels. Also nowadays consumers expect a high degree of
personalization.
6. Emerging real time, interactive channels including e-mail, ATMs and call centre that
must be synchronized with customer’s non-electronic activities. The speed of
business change, requiring flexibility and rapid adoption to technologies.
7. In the current era of hyper competition, marketers are forced to be more concerned
with customer retention and customer loyalty.
8. As several researches have found out retaining customers is less expensive and more
sustainable competitive advantage than acquiring new ones.
9. On the supply side it pays more to develop closer relationships with a few suppliers
than to develop more vendors.
10. In addition several marketers are concerned with keeping customers for life than
making one time sale. There is a greater opportunity for up selling and cross selling.
In a recent study, Naidu, et al(1999) found that relational intensity increased in
hospitals facing a high degree of competitive intensity
11. The globalization of world marketplace makes it necessary to have global account
management for the customers.
10
CRM Formation Process
In the formation process, three important decision areas relate to defining the purpose (or
objectives) of engaging in CRM, selecting parties (or customer partners) for appropriate
CRM programs and developing programs (or relational activity schemes) for relationship
engagement with the customer.
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Purpose Increase
Effectiveness Improve Efficiency
-
Programs Account
Management Retention
Marketing
Partners Criteria Process
Team Structure
Role Specification
Planning Process
Process Alignment
Monitoring Process
Communication
Employee Motivation
Employee Training
Relationship Performance Strategic Financial Marketing
Retention Satisfaction Loyalty
Evolution Enhancement Improvement
Fig. CRM Process Framework
CRM Purpose
The overall purpose of CRM is to improve marketing productivity and enhance value for
parties in involved in the relationship. By seeking and achieving operational goals, such
as lower distribution costs, streamlining order processing and inventory management,
reducing the burden of excessive customer acquisition cost, and through customer
retention economics, firms could achieve greater marketing efficiencies. They can
enhance marketing effectiveness by carefully selecting, customers for its various
programs, individualizing and personalizing their market offerings to anticipate and serve
the emerging needs of individual customer, building customer loyalty and commitment,
partnering to enter new markets and develop new products, and redefining the
competitive playing field for their company. Thus, stating the objectives and defining the
purpose of CRM in a company helps clarify the nature of CRM programs and activities
that ought to be performed by the partners. Defining the purpose would also help in
identifying suitable relationship partners who have necessary expectations and
capabilities to fulfill mutual goals. It will further help in evaluating CRM performance by
comparing results achieved against objectives. These objectives could be specified as
financial goals, marketing goals, strategic goals, operational goals, and general goals.
Customers are motivated to engage in relational behavior because of psychological and
sociological benefits associated with reduction in choice decisions. In addition, to their
natural inclination of reducing choices, consumers are motivated to seek the rewards and
benefits associated with CRM programs.
Relational Parties
In the Initial phase, a company has to decide which customer type and specific customers
or customer groups will be the focus of their CRM activities.
CRM Programs
A careful review of literature and observation of corporate practices suggest that there are
three types of CRM programs: continuity marketing; one-to-one marketing; and,
partnering programs. These take different forms depending on whether they are meant for
end-consumers, distributor consumers, or business-to-business customers.
12
Table presents various types of CRM programs developed for different types of customers.
Customer TypesProgram Types
Mass Markets Distributors Business to BusinessMarkets
Continuity Marketing After- Marketing Loyalty Programs Cross-Selling
Continuos Replenishment
ECR Programs
Special SourcingArrangements
One-to-One Marketing Permission Marketing
Personalization
Customer Business Development
Key Account Global
AccountPartnering/Company-Marketing
Affinity Partnering Co-Branding
Logistics Partnering Joint Marketing
Strategic Partnership
Co-Design Co-
DevelopmentTable CRM Programs
Continuity Marketing Programs
Take the shape of membership and loyalty card programs where customers are often
rewarded for their member and loyalty relationships with the marketers. The basic
premise of continuity marketing programs is to retain customers and increase loyalty
through long-term special services that has a potential to increase mutual value through
learning about each other.
One-to-one Marketing
Meeting and satisfying each customer’s need uniquely and individually. In the mass
markets individualized information on customers is now possible at low costs due to the
rapid development in the information technology and due to availability of scalable data
warehouses and data mining products. By using online information and databases on
individual customer interactions, marketers aim to fulfill the unique needs of each mass-
13
market customer. Information on individual customers is utilized to develop frequency
marketing, interactive marketing, and aftermarketing programs in order to develop
relationship with high-yielding customers. In the context of business-to-business markets,
individual marketing has been in place of quite sometime. Known as Key Account
Management Program, here marketers appoint customer teams to husband the company
resources according to individual customer needs.
Partnering Programs
The third type of CRM programs is partnering relationships between customer and
marketers to serve end user needs. In the mass markets, two types of partnering programs
are most common: co-branding and affinity partnering.
CRM Governance Process
Greater the scope of CRM program and associated tasks, and the more complex is the
composition of the relationship management team; the more critical is the role
specification decision for the partnering firms.
It is essential to establish intra-company communication particularly among all
concerned individuals and corporate functions that directly play a role in managing
the relationship with a specific customer or customer group.
With mass-market customers frequent face-to-face interactions will be uneconomical.
Thus marketers should create common bonds through symbolic relationships,
endorsements, affinity groups, and membership benefits or by creating online
communities
Involving customers in the planning process would ensure their support in plan
implementation and achievement of planned goals. All customers are not willing to
participate in the planning process nor is it possible to involve all of then for
relationship marketing programs for the mass markets.
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Operating process between the company and customer partners: Operating alignment
will be needed in order processing, accounting and budgeting processes, information
systems, merchandising process, etc
Human resources decisions are also important in creating the right organisation
climate for managing relationship marketing. Training employees to interact with
customers, to work in teams, and manage relationship expectations are important. So
is the issue of creating the right motivation through incentives and rewards.
Periodic evaluation of goals and results, initiating changes in relationship structure,
design or governance process if needed, creating a system for discussing problems
and resolving conflicts.
CRM Performance Evaluation Process
Without a proper performance metrics to evaluate CRM efforts, it would be hard to make
objective decisions regarding continuation, modification, enhancement, or termination of
CRM programs.
If co-operative and collaborative relationship with the customers is treated as an
intangible asset of the firm, its economic value add can be assessed using discounted
future cash flows estimates. Here the term relationship equity comes in where you
measure the intangible assets of the firm.
Another global measure used by firms to monitor CRM performance is the measurement
of relationship satisfaction. By measuring relationship satisfaction, one could estimate the
propensity of either party’s inclination to continue or terminate the relationship. Such
propensity could also be indirectly measured by measuring customer loyalty.
CRM Implementation Issues
One of the most interesting aspects of CRM development is the multitude of customer
interfaces that a company has to manage in today’s context. Until recently, a company’s
direct interface with the customers, if any was primarily through sales people or service
agents. In today’s environment most companies interface with their customers through a
15
variety of channels including sales people, service personnel, call centres, Internet
websites, marketing departments, fulfillment houses, market and business development
agents, etc. For large customers it also includes cross-functional teams that may include
personnel from various functional departments. While each of these units could operate
independently, they still need to share information about individual customers and their
interactions with the company on a real time basis. For example, a customer who just
placed an order on the Internet and subsequently calls the call centre for order verification
expects the call centre staff to know the details of his or her order history. Similarly a
customer approached by a sales person unaware that she has recently complained about
dissatisfactory customer service, is not likely to be treated kindly by the customer.
Therefore effective CRM requires a front-line information system that shares relevant
customer information across all interface units. Relational databases, data warehousing
and data mining tools are thus very valuable for CRM systems and solutions.
However, the challenge is to develop and integrated CRM platform that collects relevant
data input at each customer interface and simultaneously provides knowledge output
about the strategy and tactics suitable to win customer loyalty and support. If a call centre
personnel cannot identify or differentiate a high value customer and does not know what
to up-sell or cross sell to him then it would be a tremendous loss of opportunity for the
company. Although most CRM software solutions based on relational databases are
helping share customer information, they still do not provide knowledge output to the
front line personnel. As shown in Figure.6, CRM solutions platform needs to be based on
interactive technology and processes. It should assist the company in developing and
enhancing customer interactions and one-to-one marketing through the help of suitable
intelligent agents that help develop front-line relationship with customers. Such a system
would identify appropriate data inputs at each customer interaction site and use analytical
platforms to generate appropriate knowledge output for front-line staff during customer
interactions.
In addition, implementation tools to support interactive solutions for customer
profitability analysis, customer segmentation, demand generation, account planning,
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Knowledge Output
KnowledgeOutput
Knowledge Output
Knowledge Output
Knowledge OutputData Input
Data Input
Data Input
Data Input
Data Input
opportunity management, contact management, integrated marketing communication,
customer care strategies, customer problem solving, virtual team management of large
global accounts, and measuring CRM performance would be the next level of solution
sought by most enterprises.
Figure. Information Platform for CRM
Since CRM implementation comprises a significant information technology (IT)
component, these companies have handed over the responsibility of CRM
implementation to information technology departments. They are focussed on simply
installing CRM software solutions without a CRM strategy or program in place. This
leads to creating an operational tool within the company, but the usability and
effectiveness in producing desirable results from such tools is limited. CRM tools would
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Sales Group
MarketDevelopment
Marketing
CustomerOperations/
Service
Call Centre
Internet
Knowledge Output
Data Input
Integrated MarketingInformation PlatformInformation ContentRelational DatabasesDecision Support SystemActive IntelligenceBusiness RulesCollaborative Communication User Profiles
be valuable when they are used to identify and differentiate individual customers and to
generate individualized offer and fulfill customized solutions. The lack of CRM strategy
or CRM programs, would leave the front-line people without any knowledge of what they
should be doing with the additional customer information that they now have access to.
For those who apply themselves and develop improvised solutions, it could backfire as ad
hoc solutions could cause unintended deterioration in customer relationships. Appropriate
strategy and excellent implementation are both needed for obtaining successful results.
From a corporate implementation point of view, CRM should not be misunderstood
to simply mean a software solutions implementation project.
Knowledge Management (KM) with focus on CRM
As Peter Drucker defined “Information is data endowed with relevance and
purpose”.
To effectively implement a CRM solution it is very important to identify real knowledge
about different types of customers (Viz. Most valued customers, Most growable
customers, Below zero customers) from plethora of internal and external data, figures,
surveys, etc. A straightway technique is to create a data warehouse, thereafter
information which is required to effectively implement principles of CRM, could be
mined out of this data warehouse.
Marketing, sales after-sales people would be knowledge workers. Front office could be
more productive if they could utilize customer knowledge. Knowledge Management
(KM) is about embracing a diversity of knowledge resources, like legacy systems,
existing data warehouses, portals, websites, customers, suppliers, partners, external
marketing research agencies and cultivating the knowledge where it resides.
Metrics, ROI, Balance Scorecard method, benchmarking are some of the common
technique of KM system evaluation. KM implementation is the key to CRM.
It’s a proven fact that 80% of an organisation revenues come form 20% of its customers,
it becomes imperative to design CRM solutions keeping in mind these most valuable
18
customers and to leverage 80% non structured data of about 20% of these most valuable
customers.
Just as more tangible corporate assets like computer systems have a finite shell life, so
too does knowledge, it must be available at the right time to be able to act upon it.
Retaining tacit knowledge (derived from experiences, data and documents) means
retaining the individual, which is invariably not possible. It is possible to generate
explicit knowledge from tacit knowledge, but it’s a complex exercise. The key ingredient
of this exchange is face to face sharing of knowledge or virtual environmental tools like
Lotus Notes, which can facilitate tacit knowledge exchange. Hence for tacit knowledge
exchange text mining is very useful and important. There are ways to do text mining, like
search engines, web solutions, text analysis tools, etc. The key to successful customer
KM is personalization, i.e. how to extract the knowledge that is pertinent to the user and
translate it into a format that is easily understood. The choice of Customer Knowledge
Management (CKM) architecture should have a layered approach. Existing systems
should be seamlessly linked with the proposed layer. The choice for CKM system could
be Web (Enterprise information portal) or a packaged solution such as Lotus Notes,
Microsoft solution.
Role of CRM in the Context of SCM
In the context of SCM, where alliances and partnerships are keys to success, CRM plays
an important role in building long-term relationships. Apart from the end-users, it
involves internal employees, channel members and other external entities such as
advertising agencies and consulting organisations. The success of relationships depends
upon sharing of savings from the supply chain, which may be reinvested to further
enhance its efficiency, and sustain the competitive advantage.
The supply chain of tomorrow will look like a virtual organisation, seamlessly integrated
through sharing data and savings as well. The bonding between partners will be closely
held by CRM practices.
ERP and CRM
19
Like ERP, CRM solutions focus on automating and improving business processes, albeit
in front-office areas such as marketing, sales, customer service, and customer support.
Whereas ERP implementation can result in improved organisational efficiency, CRM
aims to provide organisational effectiveness by reducing sales cycle and selling cost,
identifying markets and channels for expansion, and improving customer value,
satisfaction, profitability, and retention. While CRM applications provide the framework
for embodying, promoting and executing best practices in customer facing activities, ERP
provides the backbone, resources and operational applications to make organisations
more efficient in achieving these goals.
Regain Management
“ The cost of acquiring a new customer is 9 to 12 times that of holding on to an existing
customer.”-Philip Kotler
A study conducted by Andersen Consulting in conjunction with EIU found that
businesses are intensifying their focus on customer and are taking a more process
oriented approach to customer relationship management. Key Findings of the study are:
(a) the number of businesses citing customer retention as a critically important measure
in the next 5 years has jumped to nearly 60%, as companies shift their focus from
attracting new customer to retaining their more profitable ones;
(b) by 2002, 83% of companies expect to have customer data warehouses, up from about
40% today; and
(c) companies predict their use of Internet to collect customer data will surge by 430%
Consumer Life Time Value
Quantifying the “value” of customers is absolutely essential in regain management. In
fact, the percentage of profit a company makes from continued sales to its own customer
base is consistently higher than the profit made on original sale.. Each of the customers
then delivers an income stream and the stream of profit far exceeds the value of original
purchase. Income streams contribute cash flows in terms of years for any single product.
20
Regain Strategies:
Customization
Differentiation Strategies
The lost customer would be segmented differently from the existing customer. Base and
the company could provide additional features and benefits to win them back.
“Wow” Syndrome
For example, a client checks into a hotel and his/her room isn’t ready. The clerk could
respond by “You are in luck! Your room isn’t ready. That means you get to eat breakfast
“on us” and use our business centre for free!”
Tools
Customer database
A good customer information system should consist of a regular flow of information,
systematic collection of information that is properly evaluated and compared against
different points in time, and it has sufficient depth to understand the customer and
accurately anticipate their behavioral patterns in future. The customer database helps
the company to plan, implement, and monitor customer contact. Customer
relationships are increasingly sustained by information systems. Companies are
increasingly adding data from a variety of sources to their databases. Customer data
strategy should focus on processes to manage customer acquisition, retention, and
development.
Other Technologies that are used are as follows:
Electronic Point of Sale(EPOS)
Sales Force Automation
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Customer Service Helpdesk
Call Centres
Call Centre helps in automating the operations of inbound and outbound calls generated
between company and its customer. These solutions integrate the voice switch of
automated telephone systems (e.g. EPABX) with an agent host software allowing for
automating call routing to agents, auto display of relevant customer data, predictive
dialing, self service Interactive Voice Response systems, etc. These systems are useful in
high volume segments like banking, telecom and hospitality. Today, more innovative
channels of interacting with customers are emerging as a result of new technology, such
as global telephone based calls centres and the internet. Companies are now focusing to
offer solutions that leverage the internet in building comprehensive CRM systems
allowing them to handle customer interactions in all forms.
Systems Integration
While CRM solutions are front office automation solutions, ERP is back office
automation solution. An ERP helps in automating business functions of production,
finance, inventory, order fulfillment and human resource giving an integrated view of
business, where as CRM automates the relationship with customer covering contact and
opportunity management , marketing and product knowledge, sales force management,
sales forecasting, customer order processing and fulfillment, delivery, installation, pre-
sale and post-sale services and complaint handling by providing an integrated view of the
customer. It is necessary that the two systems integrate with each other and complement
information as well as business workflow. Therefore, CRM and ERP are complementary.
This integration of CRM with ERP helps companies to provide faster customer service
through an enabled network, which can direct all customer queries and issues through
appropriate channels to the right place for speedy resolution. This will help the company
in tracking and correcting the product problems reported by customers by feeding this
information into the R&D operations via ERP.
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CRM – A FRAMEWORK
Data Mining for CRM: Some Relevant issues
Data mining is an important enabler for CRM. Advances in data storage and processing
technologies have made it possible today to store very large amounts of data in what are
called data warehouses and then use data mining tools to extract relevant information.
Data mining helps in the process of understanding a customer by providing the necessary
information and facilitates informed decision-making.
Operational CRM solutions involve integration of business processes involving customer
touch points. Collaborative CRM involves the facilitation of collaborative services(such
as e-mail) to facilitate interactions between customer and employees. All this effort
produces rich data that feeds the Analytical CRM technologies.
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Traditional Approach to CRM
Customer Contact by Telephone Mail In Person
Personal Selling After Sales Service Complaint Handling Account Management Customer care Customer Satisfaction
Web-Enabled & Integration Approach
Customer InformationSystem
Customer Database Electronic Point of Sale Sales Force Automation Automation of Customer
Support Call Centres Systems Integration Lifetime value of a Customer
Integration with
technology
(Web & Internet)
Information Requirements Of An Effective CRM Solution
The employees of a firm employing CRM would require rich information about their firm
and customer base including:
Information about the market
Information about the firm
The current segment
Demographic Distribution (by age, sex, education, income, marital status, etc)
The firm’s best customers and the segment they belong to, products they buy,
preferences, habits and tastes of each segment.
Individual level information consisting of:
Customer personal details such as name, address, family details, education, etc
The customer group /segment to which the individual belongs
History of present and past behavior
Likes, dislikes, habits and preferences
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Operational CRM Collaborative CRMAnalytical CRM
Customer
Fig.8 Interactions between CRM Technologies
Events coming up in their personal life etc.
Levels of data mining operations
The aggregate or the Macro level
Mining at the macro level gives us a broad overview of the data e.g. when customer
of the retail store are segmented by profitability criteria, we obtain clusters who are
profitable to various extent. Knowledge obtained by mining at macro level is useful
when dealing with situations where:
We are dealing with a customer about whom we do not have individual
information . Hence, we need to extrapolate the characteristics of the group to which
he/she might belong. In retail store example, a store can segment its customers on
basis of age and characteristics can be extracted. When a new customer enters the
store, the salesman could use his intuition in arriving at the customer’s age and
recover the characteristics of that age group such as the frequently bought products,
colour preferences, etc.
Targeting new set of customers. If the retail chain has opened a new store it can
use the data from the most similar current store to predict the behavior of the new
prospects.
We are dealing with aspects of the service, which influence a majority of the
customer and therefore cannot be customized to suit individual tastes, example being
the design of the physical layout of a retail store.
Predicting the possibility of an action that the cu has never undertaken. A
customer might not have tried out a new product because he/she was not aware of it.
A salesman can encourage him/her to try out the product if his/her profile matches
that of the current product users.
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The Individual or Micro level
As interactions of the individual with the firm increases, the firm obtains more data
about him/her. Offering individualized value adding propositions can strengthen
relationship with the individual customer. For this, we need to track the cu and mine
at the individual or micro level. Some important features to note about mining at this
level are:
Micro-level mining provides specific information about a particular customer.
For example, the retail store can go to the extent of finding out the preferred
colours of his shirt
A firm takes up micro level mining to build a detailed customer profile of a
regular customer.
Data mining this level might be expensive if the data mining tool has to cull
out individual information from a large database. Having a separate database for
profitable customer might be helpful.
Knowledge obtained at the individual level is useful in situations where:
The firm wants to customize its offering to the customer based on the
customer’s tastes and preferences e.g. the retail store can offer discounts on the
purchase of a bundle of products that the customer prefers buying together.
The firm wants to assist the purchase of a new product based on the
information it has of the last purchase. For example, if a customer has bought a
suit in his visit, then the store might offer a discount on the purchase of a tie of
a matching colour.
The firm wants to take advantage of the personal events in a customer’s life
(e.g. birthdays, anniversaries, birth of child etc.) to further cement the precious
relationship.
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Current patterns that go against usually observed customer behavior point to
interesting phenomenon. If retail customer suddenly switches brand then
he/she might not be satisfied with the last purchase.
The most common operations used at this level are: -
Classification:
Classification is a process that maps a given data item into one of the several predefined
classes. CRM uses classification for a variety of purposes like behavior prediction,
product and customer categorization.
Regression
Regression is the operation of learning a function that predicts the value of a real valued
dependent variable based on values of other independent variables. Regression finds
application in a CRM environment where prediction needs to be made about the behavior
regarding real value added variables. Suppose the retail store collects data on the monthly
visits of the customers viz. Frequency, time spent on each visit. And purchases made
during each visit. If the manager has a strong intuition that total purchase is linked to
frequency of visit, then this situation can be modeled by regression. This model can then
be used to predict future purchases of a customer. Regression needs sufficient amount of
data to be reliable and valid.
Link Analysis
Link Analysis seeks to establish relationship between items or variables in a database
record to expose patterns and trends. Link analysis can also trace connections between
items of record over time. The most important link analysis application in CRM, called
market basket analysis, is an operation that seeks relationship between product items
characterizing product affinities or buyer preferences. The retail store collects thousands
of interactions daily. A link analysis task performed on this data will point to items that
are bought together e.g. bread and butter are bought together rather than bread and orange
juice. Such information can be used to design store layouts, design coupons, etc.
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Segmentation
Segmentation aims to identify a finite set of naturally occurring clusters or categories to
describe data.
Deviation Detection
Deviation Detection (DD) focuses on discovering the most significant changes in the data
from previously measured, expected or normative values. Most CRM solutions have a
DD task running in parallel on a regular basis. Suppose a retailer finds out that the sales
from a particular section of the store have been much less than expected. This deviation
on further analysis points out to non-stocking of a popular brand.
Tools such as decision trees, rule induction, case based reasoning, visualization
techniques, nearest neighbor techniques, clustering algorithms, etc are used for the above
purposes.
The existing CRM Solutions
Delivering the ‘360 view’ requires automation to bring together all the data concerning a
customer. This implies the organisation has to change from:
Mass Marketing Product Focus
Product Focus Customer Focus
Economies of Scale Economies of time
1 way communication Interactive
Response Time Real Time
Present CRM Alternatives
Present CRM solutions are offered by host of vendors that are to a great extent not
industry specific. While there are some vendors, who have come up with industry
specific solutions, the broad model around which the CRM solutions are built remain the
same. Adopting a similar or a look a like solution across industries is what causes major
strain in servicing a customer.
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Typical offerings of the current CRM solutions (such as Siebel, Oracle Apps or
MySap.com, etc) vary from solution to solution. However typical CRM offerings consist
of:
Customer Development Field sales, Tele sales, Internet Sales
Service Centre Call Centres, Field Service
Sale management and support Internet Customer Service
Market Analysis Service Interaction Centre
Internet, Tele marketing Business Partner Collaboration
Product and brand management
The Customer focussed organisation: CRM Model
The idea here is to develop systems that allow flexibility, work on not completely
predefined processes so as to enable front office to be proactive to each customer needs
The Mindset impact on CRM
A typical data warehouse will have the following components:
While developing a data warehouse one takes into account all the legacy and operation
systems. But typically sales teams could be managing leads on an excel worksheet.
Sometimes critical DSS input like “Profitability Analysis” itself may reside on a
worksheet.
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Thus a Data Warehouse solution must be able to accept information from such
“unstructured” sources as well as budget for an open architecture to enable plug-in for
systems to be developed in the future.
a) Generally the existing information is mapped into a data warehouse. Since a customer
centric info-base is being developed, its is critical that extensive customer research is
done to identify their information needs and thus what profile data will be relevant for
us. Thus any data-warehousing project needs to work closely with the research team.
b) After extracting the data from various systems, we need to scrub and clean the data,
deduplicate.
c) Even though we may find 80% of the names in a database of a million customers
using combinations of lets say a 1000 first and last names, to take into account all
possible combinations we may actually need a database of 10,000 first and last
names. Even then we may not be able to comprehensively cover all future
combinations. Now, the system must expect this kind of input on a regular basis
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OLAP Tool
Risk Cube
F P & ACube
Mktg &Sales Cube
Campaign Mgmt
DataWarehouse
Legacy & OperationExtract & Transfer
rather than it happening by exception, as is the case with updating “masters” in a
traditional system.
d) Ad-hoc querying is a tool that is most often used in such applications. Unfortunately
not much effort is made to make this tool “end-user” friendly so that even a layman
could run his/her reports. Typically a data-warehouse and data mining person is
placed in information technology to manage all queries. With the advent of tools like
MetaData Repository, drill down OLAP tools and Palm Pilots it is now possible for
hardcore marketing and sales types to directly access and run their queries. Infact we
need to budget for training the sales and marketing team with the use of data-
warehouse.
e) The real power of the CRM system is its ability to provide a rich, value added
experience to our customers at all touch points – call Centres, kiosks, retail outlets,
mobile devices, Internet and branches. Integration and information dissemination
must happen at all these points. Thus the CRM specialist in marketing must be well
versed with all these tools and techniques.
eCRM
What is eCRM?
In simplest terms eCRM provides companies with means to conduct interactive,
personalized and relevant communications with customer across both electronic and
traditional channels. It utilizes a complete view of the customer to make decisions about
messaging, offers and channel delivery. It synchronises communication across otherwise
disjoint-customer facing systems. It adheres to permission based practices, respecting
individual’s preferences regarding how and whether they wish to communicate with you
and it focuses on understanding how the economics of customer relationship affect the
business.
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eCRM Vs CRM
CRM is essentially a business strategy for acquiring and maintaining the “right”
customers over the long term. Within this framework, a number of channels exist for
interacting with customers. One of these channels is “electronic” – and has been labeled
“e-commerce” or “e-business”. This electronic channel does not replace the sales force,
the call Centre, or even the fax. It is simply another extension, albeit a powerful new one,
to the customer. The thrust of eCRM is not what the organisation is “doing on the web”
but how fully the organisation ties its on-line channel back to its traditional channels, or
customer touch points.
Why employ eCRM?
Companies need to take firm initiatives on the eCRM frontier to
Optimize the value of interactive relationship
Enable the business to extend its personalized reach
Company-ordinate marketing activities across all customer channels.
Leverage customer information for more effective emarketing and ebusiness
Focus the business on improving customer relationship and earning a greater share
of each customer’s business through consistent measurement, assessment and
“actionable” customer strategies.
The six “E’s” of eCRM
1. Electronic channels
2. Enterprise
3. Empowerment
4. Economics
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5. Evaluation
6. External Information
eCRM Architecture
The primary inputs to this module are mainly from the eCRM Assessment and strategy
alignment modules. During this stage the company will try and develop a Connected
Enterprise Architecture (CEA) within the context of the company’s own CRM strategy.
The following is a set of technical eCRM capabilities and applications that collectively
and ideally comprise a full eCRM solution:
Customer Analytical Software
Data mining software
Campaign Management software
Business Simulation
A real time decision engine
Review and Assessment of CRM solutions
CRM software applications embody best practices and employs advanced technologies to
help organisations achieve these goals.
Categories of CRM solutions
Any enterprise , which wants to implement CRM solutions can choose from four
categories of solutions
Integrated applications suite
Interfaced applications bundle
Interfaced best of breed solutions
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Best of cluster
Selecting an interfaced best of breed approach for pure functionality or a front office
application suite solely for integration limits enterprise choices. Enterprises need to start
with a clear picture of the basic truths of integration, interfacing and functionality. An
integrated application suite is a set of application that employs a common architecture,
referencing a common logical database with a single schema. Some suites are more often
interfaced application bundle i.e. a set of interfaced application from a single vendor
containing more than one technical architecture or more than one logical database-
frequently assembled by the vendor through the process of acquisition or partnership
An alternative approach to suites is an interfaced best of breed solution – an approach
whereby an enterprise selects from multiple vendors a set of applications that must be
interfaced to work together, either by the enterprise, one of the selected vendors or a third
party integrator. The individual applications are not the best in any objective sense.
Rather, some enterprises select the applications because they best meet the particular
needs. The challenge of this approach is that, in some cases, the enterprise fails to
complete the necessary interfaces to get the individual applications working together;
consequently, the applications remain stove pipes. Best of cluster is similar to best of
breed except that here best is chosen from the cluster and they are interfaced.
Key requirements for CRM solutions
Some of the functional and technical requirements for CRM solutions are as listed below:
Business intelligence and analytical capabilities
Unified channels of customer interactions
Support for web based functionality
Centralized repository for customer information
Integrated work flow
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Integration with ERP applications
Functional Components of CRM solution
CRM applications are a convergence of functional components, advanced technologies
and channels. Functional components and channels are described below:
Sales applications
Common applications include calendar and scheduling, contact and account management;
compensation; opportunity and pipeline management; sales forecasting; proposal
generation and management; pricing; territory assignment and management; and expense
reporting.
Marketing applications
These include web based and traditional marketing campaign planning, execution, and
analysis;list generation and management; budgeting and forecasting; collateral generation
and marketing materials management.
Customer service and support applications
These include customer care; incident, defect and order tracking; field service; problem
and solution database; repair scheduling and dispatching; service agreements and
contracts; and service request management.
Given below is a brief review of what some of the known vendors in this area have in
their applications for these verticals. The table 2 at the end gives comparative assessment
of the products discussed below for the above verticals:
SIEBEL
It continues to out market and out sell the competition. It is one of the few front office
suite vendors having vertical specific functions. Its functionality is compelling. It can be
integrated with most of the back office solution like SAP and Oracle. It has solutions for
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automotive, public sector (US), communications, consumer goods, apparel and footwear,
energy, finance, insurance, health care, life sciences and high technology industry sectors.
The solutions for the verticals described above are discussed below:
For Consumer goods: a Siebel eConsumer goods offers eBusiness solution spanning
the entire demand chain from the end consumer, through the retailer and the
wholesaler, to the manufacturer. It has robust trade promotions planning
functionality allowing users to manage customer promotion plans and the funds to
support them, while comprehensive route planning functionality enables integrated
account targeting. Using Siebel eConsumer Goods, organisations can also identify
customer-buying behaviors and translate this understanding into new trade
promotions and product offerings
For Financial Services: Siebel eFinance enables banking, brokerage, insurance, and
capital market organisations to establish and maintain long term profitable
relationship with consumers, small businesses, and corporate customers. The
organisations can capitalize on information captured during each customer
interaction to more effectively cross-sell and up-sell additional products and services.
Additionally, Siebel eFinance provides a comprehensive view of the entire customer
relationship across multiple product lines, enabling financial service organisations to
provide a personalized experience across all channels.
For Healthcare: Siebel eHealthcare gives organisations the ability to streamline and
improve sales, member services, medical management, and network management
services. By using multiple distribution channels, including the Internet, call Centres,
home office staff and independent brokers, Siebel eHealthcare provides organisations
with a single view of their customers, thereby ensuring better service and improved
quality of care.
For telecom service providers: Siebel eCommunications helps wireless, cable, and
Internet service providers to target and win the right customers, accelerate service
delivery, and provide service across all touchpoints. Siebel eCommunications
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embodies the industry’s best practices for generating accurate service orders,
managing billing inquiries and adjustments, and up-selling and cross-selling
additional services. By using Siebel eCommunications’ integration technology,
service representatives and salespeople can instantly access information such as
billing, order management, and network management from Operation Support
Systems (OSS), to deliver highly responsive customer support and significantly
increase sales.
Siebel 99, the vendor's major release, boasts 117 applications that span sales and service and
incorporate multiple vertical markets.
A major effort in the new application release is it integrates all the channels companies use to
contact customers: Web, E-mail, voice, wireless and face-to-face contact.
Some of Siebel employee-
facing applications are:
Some of Siebel customer-
facing applications are:
Some of the additional products
available in version 6.0
Siebel Call Center Siebel eChannelSiebel eBusiness Connector for
SAP R/3 ®
Siebel eMail Response Siebel eCustomer Siebel Communications Server
Siebel Field Service Siebel eMarketing Siebel Distance Learning
Siebel Marketing Siebel eSales Siebel Global Enterprise Support
Siebel Sales Siebel eService Siebel Language Extensions
Siebel Service Siebel Wireless
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Clarify
It offers customer service & support and field service suite; however its sales
functionality is immature.
Oracle
Oracle is betting everything on its thin, Web Based, centralized computing model. The
Internet computing architecture is compelling for connected non-mobile users; Oracle is
rebuilding functionality on the new platform and integrates its various acquired products.
It offers a broad set of functionality across e-commerce, front office and business
intelligence applications.
Vantive
Vantive offers a compelling customer service and support and field service suite. The rest
of its front office functionality makes it suite more of a bundle. The solution is integrated
with PeopleSoft at the back office.
Table Comparative Assessment of CRM Products for Vertical Specific Requirements
CRM Application Requirement
Siebel Clarify Oracle Vantive
Consumer Products
Category Management Available Available Available Available
Promotion Management Available Available Available Available
Demand Planning Available N.A. Available N.A.
Interactive Selling Available Available Available Available
Telecom Service Providers
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Blended Sales & service contact Centre
Available Available Available Available
Competitive Pricing Analysis N.A. N.A. N.A. N.A.
Integration with Billing System
Available Available Available N.A.
Churn management Available Available Available N.A.
Commercial Banking
Contact Centre Available Available Available Available
Profitability Analysis Available Available Available Available
Integrated Targeting N.A. N.A. Available N.A.
Marketing Datamining N.A. N.A. Available N.A.
Pharma & Healthcare
Contract Management Available N.A. Available N.A.
Marketing Analysis N.A. Available N.A. N.A.
Disease Education System Available N.A. N.A. N.A.
Knowledge Management System
Available Available N.A. Available
Some Indian CRM solutions are by Sales Logix, Logix Microsystems, Sonata Software,
Oracle India, L&T information technology, etc.
Other CRM solutions are Aurum, Epiphany, Avyaya and Onyx.
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Some frequent modules that most CRM have is:
Forecast Management, Encyclopedia Management, Campaign Management, Brand
Management, Opportunity Management, and Event Management.
CRM solutions are interwined combinations of technology and business processes. In
order to be effective CRM service providers will need a balanced understanding of both
products and services. It’s necessary to have an expertise in not CRM technology but also
customer service processes.
The potential use of CRM lies in it being the leading indicator of future revenue than just
being used as a customer facing transaction-processing tool or as a lagging indicator
communicating past consumer grievances.
The complete concept of CRM can be mapped on a technology solution as per the
following blue print. The databases feed the technology infrastructure which links You
with the customer touch points.
Thus we have four components of a CRM initiative rollout
Customer Value Management Strategy
CRM roadmap keeping in mind industry nuances
Database solutions
Customer access channels
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INDUSTRY INTRODUCTION
FMCG product is well known as fast moving consumer goods. The FMCG products are
the daily need based product like health care, fabric care, hair care, baby care, oral care,
personal care etc. Because of the daily needs these products have the demand in the
market. In personnel care these product play a vital role in daily life like shampoo,
shaving cream, hair oil, detergent bar, toothpaste etc.
Indian population potential is huge that’s why India is a big market for FMCG The big
player like wall mart Bharti, reliance, Amway, Chaupal fresh, Birla are entering in
FMCG sector. P&G and HUL are already existing big player in FMCG sector because of
the increasing competition P&G launches the different schemes one of them is ‘golden
store’. That’s why how it is beneficial to wholesaler and retailer; the study of golden store
is introduced.
Fast Moving Consumer Goods (FMCG), also known as Consumer Packaged Goods
(CPG), is a product that is sold quickly at relatively low cost. Though the absolute profit
made on FMCG products is relatively small, they generally sell in large quantities, so the
cumulative profit on such products can be large. The Procter & Gamble Company is
focused on providing branded products to improve the lives of the world's consumers.
Today, the Company markets over 300 branded products in more than 160 countries.
Procter & Gamble markets over 300 branded products in more than 160 countries. The
Company has operations in over 80 countries through its Market Development
Organization "MDO". The MDO includes dedicated retail customer, trade channel and
country-specific teams that work to build the Company's brands in local markets. It is
organized along seven geographic areas: North America, Western Europe, Northeast
Asia, Latin America, Central and Eastern Europe/Middle East/Africa, Greater China and
ASEAN/Australasia/India.
P&G and Gillette merge into one company and add five more Billion Dollar Brands to
our product portfolio including Gillette and Braun's shaving and grooming products, the
Oral-B dental care line and Duracell batteries.
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OVERVIEW OF FMCG SECTOR IN INDIA
The Indian FMCG sector is the fourth largest sector in the
economy with a total market size in excess of US$ 13.1 billion.
It has a strong MNC presence and is characterized by a well-
established distribution network, intense competition between
the organized and unorganized segments and low operational
cost. Availability of key raw materials, cheaper labour costs
and presence across the entire value chain gives India a
competitive advantage.
The FMCG market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4 billion in
2015. Penetration level as well as per capita consumption in most product categories like
jams, toothpaste, skin care, hair wash etc in India is low indicating the untapped market
potential. Burgeoning Indian population, particularly the middle class and the rural
segments, presents an opportunity to makers of branded products to convert consumers
to branded products. Growth is also likely to come from consumer 'upgrading' in the
matured product categories. With 200 million people expected to shift to processed and
packaged food by 2010, India needs around US$ 28 billion of investment in the food-
processing industry.
India is one of the largest emerging markets, with a population of over one billion. India
is one of the largest economies in the world in terms of purchasing power and has a
strong middle class base of 300 million. Around 70 per cent of the total households in
India (188 million) reside in the rural areas. The total number of rural households is
expected to rise from 135 million in 2001-02 to 153 million in 2009-10. This presents
the largest potential market in the world. The annual size of the rural FMCG market was
estimated at around US$ 10.5 billion in 2001-02. With growing incomes at both the rural
and the urban level, the market potential is expected to expand further.
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Rural and urban potential
Rural-urban profile
Urban Rural
Population 2001-02 (mn household) 53 135
Population 2009-10 (mn household) 69 153
% Distribution (2001-02) 28 72
Market (Towns/Villages) 3,768 627,000
Universe of Outlets (mn) 1 3.3
Source: Statistical Outline of India (2001-02), NCAER
An average Indian spends around 40 per cent of his income on grocery and 8 per cent on
personal care products. The large share of fast moving consumer goods (FMCG) in total
individual spending along with the large population base is another factor that makes
India one of the largest FMCG markets.
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Rapid urbanization, increased literacy and rising per capita income, have all caused rapid
growth and change in demand patterns, leading to an explosion of new opportunities.
Around 45 per cent of the population in India is below 20 years of age and the young
population is set to rise further. Aspiration levels in this age group have been fuelled by
greater media exposure, unleashing a latent demand with more money and a new
mindset.
The saying goes customer is king. Gone are the days of supernormal profits; gone are the
days of monopoly in the 21-century, more and more companies have realized the
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importance of acquiring and retaining customers. Companies have moved beyond
customer satisfaction, customer delight is the new mantra.
The FMCG industry in India is characterized with low switching cost. Mostly it is an
industry having low involvement buying, where the customer is ready to experiment with
new brands. With more and more companies fighting for customer locality from the same
customer group, constantly meeting and exceeding customer expectations is the key to
success today.
Most of the FMCGs have a large network of warehouses/depots, distributors, retailers.
Also most of the retailing in India is through unorganized sector, with only about 4% of
retailing through organized retail. This has resulted in complex distribution network for
most of the FMCGs. Making the products available with all distributors and retailers in
right numbers at the right time according to the demand is the biggest challenge for the
FMCG sector.
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COMPANY PROFILE
HISTORY OF P&G
William Procter, a candlemaker, and James Gamble, a soapmaker, formed the company
known as Procter & Gamble in 1837. The two men, immigrants from England and
Ireland respectively, who had settled earlier in Cincinnati might never have met had they
not married sisters, Olivia and Elizabeth Norris.
Since both their industries used similar resources, the Panic of 1837 caused intense
competition between the two and as a result it led to discord with the family. Alexander
Norris, their father-in law decided to call a meeting where he convinced his new sons-in-
law to become business partners. On October 31, 1837, as a result of the suggestion, a
new enterprise was born: Procter & Gamble.
The company prospered during the nineteenth century. In 1859, sales reached one million
dollars. By this point, approximately eighty employees worked for Procter & Gamble.
During the American Civil War, the company won contracts to supply the Union Army
with soap and candles. In addition to the increased profits experienced during the war, the
military contracts introduced soldiers from all over the country to Procter & Gamble's
products. Once the war was over and the men returned home, they continued to purchase
the company's products.
In the 1880s, Procter & Gamble began to market a new product, an inexpensive soap that
floats in water. The company called the soap Ivory. In the decades that followed, Procter
& Gamble continued to grow and change. The company became known for its
progressive work environment in the late nineteenth century. William Cooper Procter,
William Procter's grandson, established a profit-sharing program for the company's
workforce in 1887. He hoped that by giving the workers a stake in the company, they
would be less inclined to go on strike.
Over time, the company began to focus most of its attention on soap, producing more
than thirty different types by the 1890s. As electricity became more and more common,
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there was less need for the candles that Procter & Gamble had made since its inception.
Ultimately, the company chose to stop manufacturing candles in 1920.
In the early twentieth century, Procter & Gamble continued to grow. The company began
to build factories in other locations in the United States, because the demand for products
had outgrown the capacity of the Cincinnati facilities. The
company's leaders began to diversify its products as well and, in 1911, began producing
Crisco, a shortening made of vegetable oils rather than animal fats. In the early 1900s,
Procter & Gamble also became known for its research laboratories, where scientists
worked to create new products. Company leadership also pioneered in the area of market
research, investigating consumer needs and product appeal.
As radio became more popular in the 1920s and 1930s, the company sponsored a number
of radio programs. As a result, these shows often became commonly known as "soap
operas."
Throughout the twentieth century, Procter & Gamble continued to prosper. The company
moved into other countries, both in terms of manufacturing and product sales, becoming
an international corporation with its 1930 acquisition of the Newcastle upon Tyne-based
Thomas Hedley Co. Procter & Gamble maintained a strong link to the North East of
England after this acquisition. In addition, numerous new products and brand names were
introduced over time, and Procter & Gamble began branching out into new areas.
The company introduced Tide laundry detergent in 1946 and "Prell" shampoo in 1950. In
1955, Procter & Gamble began selling the first toothpaste to contain fluoride, known as
"Crest". Branching out once again in 1957, the company purchased Charmin Paper Mills
and began manufacturing toilet paper and other paper products. Once again focusing on
laundry, Procter & Gamble began making "Downy" fabric softener in 1960 and "Bounce"
fabric softener sheets in 1972. One of the most revolutionary products to come out on the
market was the company's "Pampers", first test-marketed in 1961.
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Prior to this point disposable diapers were not popular, although Johnson & Johnson had
developed a product called "Chux". Babies always wore cloth diapers, which were leaky
and labor intensive to wash. Pampers simplified the diapering process.
Over the second half of the twentieth century, Procter & Gamble acquired a number of
other companies that diversified its product line and increased profits significantly. These
acquisitions included Folgers Coffee, Norwich Eaton Pharmaceuticals, Richardson-
Vicks, Noxell, Shulton's Old Spice, Max Factor, and the Iams Company, among others.
In 1994, the company made headlines for big losses resulting from leveraged positions in
interest rate derivatives, and subsequently sued Bankers Trust for fraud; this placed their
management in the unusual position of testifying in court that they had entered into
transactions they were not capable of understanding.
In 1996, Procter & Gamble again made headlines when the Food and Drug
Administration approved a new product developed by the company, Olestra. Also known
by its brand name Olean, Olestra is a substitute for fat in cooking potato chips and other
snacks. Procter & Gamble has expanded dramatically throughout its history, but its
headquarters still remains in Cincinnati. {Source, Ohio History Central.}
In January 2005 P&G announced an acquisition of Gillette, forming the largest consumer
goods company and placing the Anglo-Dutch Unilever into second place. This added
brands such as Gillette razors, Duracell, Braun, and Oral-B to their stable. The
acquisition was approved by the European Union and the Federal Trade Commission,
with conditions to a spinoff of certain overlapping brands. P&G has agreed to sell its
SpinBrush battery-operated electric toothbrush business to Church & Dwight. It also
plans to divest Gillette's oral-care product line, Rembrandt. The deodorant brands Right
Guard, Soft & Dri, and Dry Idea were sold to Dial Corporation. The companies officially
merged October 1, 2005.
P&G's dominance in many categories of consumer products makes its brand management
decisions worthy of study. For example, P&G's corporate strategists must account for the
likelihood of one of their products cannibalizing the sales of another
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P&G Home Products Limited is one of India's fastest growing Fast Moving Consumer
Goods Companies that has in its portfolio P&G's global brands such as Ariel and Tide in
the Fabric Care segment, and in the Hair Care segment: Head & Shoulders - world's
largest selling anti-dandruff shampoo; Pantene - world's No. 1 beauty shampoo; and
Rejoice Asia's No. 1 shampoo.
P&G Home Products Limited is a 100% subsidiary of The Procter & Gamble Company,
USA, that in India, has carved a reputation for delivering superior quality, value-added
products to meet the needs of consumers.
P&G Hygiene and Health Care Limited is one of India's fastest growing Fast Moving
Consumer Goods Companies that has in its portfolio P&G's billion dollar brands such as
Vicks & Whisper. With a turnover of Rs. 500+ cores, the Company has carved a
reputation for delivering high quality, value-added products to meet the needs of
consumers.
P&G Hygiene and Health Care Limited takes pride in being voted India's Best Employer
2003 in a survey of 200 companies conducted by International HR Consultancy Hewitt
Associates in association with Business Today magazine. Earlier, the Company was
voted India's 2nd Best Employer in previous editions of the survey in 2001 and 2002.
Notably, there are over 200 Indian employees with P&G Subsidiaries abroad.
P&G and Gillette merge into one company and add five more Billion Dollar Brands to
our product portfolio including Gillette and Braun's shaving and grooming products, the
Oral-B dental care line and Duracell batteries.
BACKGROUND NOTE:
The US based P&G is the no.1 maker and marketer of household products in the US and
one of the largest FMCG companies in the World. It was established in 1837 when
William Procter, a candle maker and his brother-in-law, James gamble a soap maker,
merged their small businesses. They setup a shop in Cincinnati and nicknamed it
‘porkoplis’ because of its dependence on swine slaughterhouses. By 1859, P&G was
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generating sales of Rs. 10mn. The company introduced Ivory a floating soap in 1879 and
Crisco, the first all vegetable shortening in 1911.
Between 1940’s and 1960’s P&G embarked on a series of acquisition. The company
acquired Spic & Span (1945), Duncan Hines (1956), Clorox (1957, sold in 1968) and
Folgers coffee (1963). In 1985, P&G announced several major organizational changes
relating to category management, purchasing, manufacturing, engineering and
distribution.
After witnessing a period of significant organic and inorganic growth worldwide, P&G
began to face several problems during the 1990’s. Its new products development
activities seemed to have slowed down. Reportedly, its risk-averse culture seems to be
stifling innovation and obstructing commercialization of new ideas quickly. During the
late 1990’s P&G revenues were stagnant and its income was decreasing.
By mid 2003 the company was well on its way towards achieving these targets. It
streamlined its businesses by broadly dividing them in to 5business segments- Fabric and
homecare, Baby, Feminine, and family care, beauty care, health care and Food &
beverages. These segments comprised of several product division that collectively sold
more than 300 brands to nearly 5bn consumers in 160 countries across the globe. Some
major P&G brands were Tide, Ariel, Pampers, Whisper, Pantene, Cheer, gain, head &
shoulders, Clairol herbal essences, Ivory personal care, Crest, Vicks Vaporub, Actonel
and Max Factor cosmetics.
For the financial years ending June 2003, P&G reported revenues of Rs. 86.76bn and net
earnings of Rs. 10.36bn. In 2003 the company was ranked 31st among the fortune 500
companies. P&G had operation in 80 countries globally. With an employee strength of
around 110,000 worldwide.
COMPANY PURPOSE:
We will provide branded products and services of superior quality and value that improve
the lives of the world's consumers. As a result, consumers will reward us with leadership
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sales, profit, and value creation, allowing our people, our shareholders, and the
communities in which we live and work to prosper.
COMPANY VALUES:
P&G is its people and the values by which we live. We attract and recruit the finest
people in the world. We build our organization from within, promoting and rewarding
people without regard to any difference unrelated to performance. We act on the
conviction that the men and women of Procter & Gamble will always be our most
important asset.
INTEGRITY
We always try to do the right thing.
We are honest and straightforward with each other.
We operate within the letter and spirit of the law.
We uphold the values and principles of P&G in every action and decision.
We are data based and intellectually honest in advocating proposals, including
recognizing risks.
PASSION FOR WINNING
We are determined to be the best at doing what matters most.
We have a healthy dissatisfaction with the status quo.
We have a compelling desire to improve and to win in the marketplace.
TRUST
We respect our P&G colleagues, customers, and consumers, and treat them, as we
want to be treated.
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We have confidence in each other's capabilities and intentions.
We believe that people work best when there is a foundation of trust.
COMPANY PRINCIPLES
a) We Show Respect for All Individuals
We believe that all individuals can and want to contribute to their fullest potential.
We value differences.
We inspire and enable people to achieve high expectations, standards, and
challenging goals.
We are honest with people about their performance.
b) The Interests of the Company and the Individual Are Inseparable
We believe that doing what is right for the business with integrity will lead to
mutual success for both the Company and the individual. Our quest for mutual
success ties us together.
We encourage stock ownership and ownership behavior.
c) We Are Strategically Focused in Our Work
We operate against clearly articulated and aligned objectives and strategies.
We only do work and only ask for work that adds value to the business.
We simplify, standardize, and streamline our current work whenever possible.
d) We Value Personal Mastery
We believe it is the responsibility of all individuals to continually develop
themselves and others.
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We encourage and expect outstanding technical mastery and exceptional
excellence.
e) We Seek to Be the Best
We strive to be the best in all areas of strategic importance to the Company.
We benchmark our performance rigorously versus the very best internally and
externally.
We learn from both our successes and our failures.
f) Innovation Is the Cornerstone of Our Success
We place great value on big, new consumer innovations.
We challenge convention and reinvent the way we do business to better win in the
marketplace.
DISTRIBUTION CHANNEL OF COMPANY:
Material is procured by C.G. marketing from P&G Mumbai. Then it is distributed to the
wholesaler, retailer, & distributor.
Procedure of distribution
1. Sales executive from C. G. Marketing visit to various wholesaler, and retailer
2. Then stock check by him
3. Then he take the order from shop and also suggest to add the new goods of P&G
4. Then he put forward orders to C. G. Marketing office
5. The material is outward from C.G. Marketing office to various shop from were
the order is taken.
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PRODUCT RANGE
Fabric Care
Procter & Gamble has two of its world-leading detergents – Tide and Ariel, in India to
cater to the main concerns of the Indian households, namely, outstanding whiteness and
stain-removal.
Ariel Front-O-Mat
Ariel 2 Fragrances
Tide Detergent
Tide Bar
ARIEL 2 FRAGRANCES:-
In 1991, Procter & Gamble India launches Ariel detergent - another of P&G's global,
breakthrough technology products. Also, in the same year the Mandideep (Bhopal)
Factory starts its operations. Ariel is the world’s leading detergent and epitomizes ‘stain
removal’.
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Core Target Audience
Females seeking superior end result from their cleaning
Core Equity
Best possible cleaning as shown by stain removal
Key Features & Benefits
Provides superior cleaning, removing stains in the 1st wash.
Revolutionary new technology ‘ZPB’ helps remove clay stains better
Ideal for hand wash and top loading machines.
Available in 2 scents to appeal more consumers.
SKU Lineup
SKU 20gm 200gm 500gm 1kg 1.5kg
MRP (Rs.) 2 26 55 107 158
ARIEL FRONT-O-MAT:-
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Ariel Front-o-Mat is introduced in India exclusively for front load washing machines.
The unique tumble wash technology of front-loading machines needs a special chemistry,
which Ariel Front-o-Mat provides. Using Ariel Front-o-Mat completely eliminates the
need to bucket soak and a scrub.
Core Target Audience
Females seeking superior end result from their cleaning in front-loading washing
machines
Core Equity
Best possible cleaning as shown by stain removal
Key Features & Benefits
Low suds. Ideal for front-loading machines, which need a special detergent
chemistry due to their tumble wash technology.
Using Ariel Front-O-Mat completely eliminates the need to bucket soak and
scrub.
SKU Lineup
SKU 1kg
MRP (Rs.) 155
TIDE
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Launched in India in mid-2000, Tide provides ‘Outstanding Whiteness’ on white clothes
& excellent cleaning on colored clothes as well. This is possible, due to its ‘anti-
redisposition’ global technology, which Tide employs.
Core Target Audience
Females wanting to keep their family’s clothes absolutely clean
Core Equity
Superior whiteness for everyday family clothes
Key Features & Benefits
World’s first and most trusted detergent.
Tide provides superior whiteness for everyday clothes.
Brightens colored clothes due to the ‘Anti-Redeposition’ global
technology, which prevents dirt from re-settling on the fabric during the
wash itself.
SKU Lineup
SKU 20gm 200gm 500gm 1kg 2kg 4kg
MRP (Rs.) 2 11 26 51 102 204
Hair care
P&G’s Beauty Business is over US$ 10 Billion in Global Sales, making it one of the
world’s largest beauty companies. The P&G beauty business sells more than 50 different
beauty brands including Pantene, Olay, SK-II, Max Factor, Cover Girl, Joy, Hugo Boss,
Herbal Essences and Clairol Nice ’n’ Easy. In India, P&G’s beauty care business
comprises of Pantene, the world’s largest selling shampoo, Head & Shoulders, the
world’s No. 1 Anti-dandruff shampoo and Rejoice – Asia’sNo.1Shampoo.
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Procter & Gamble is committed to making every day in the lives of its consumers better
through the superior quality of its products and services.
Pantene Pro V
Head & Shoulders
Rejoice
PANTENE PRO V
Core Target Audience
Female, 18-34 years old
Core Equity
Beauty via superior hair health transformation
Key Features & Benefits
Amino Pro-V Complex that makes hair 10 times stronger.
Gentle enough for daily use, even on premed or color-treated hair.
Variants
Smooth & Silky for Straighter hair. High conditioner level for healthy, straight
looking hair with a vibrant shine.
Volume & Fullness for Thicker hair. High conditioner level for a healthier,
fuller and bouncier feel to the hair.
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Lively Clean for Livelier hair. Low conditioner level that converts weighted
down and oily hair to clean, fresh and healthy hair that remain free-flowing
throughout the day.
Long Black for the Long & Black hair look. High conditioner level. Darkens
each strand of hair uniformly from root to tip and enables women to keep their
hair long.
Hair Fall Control for reducing hair fall by 50% in just 2 months. High
conditioner level.
SKU Lineup
Variant 7.5ml 100ml 200ml 400ml
Smooth & Silky 3 54 99 164
Hair Fall Control 3 54 99 164
Lively Clean 3 - 99 -
Long Black 3 54 99 -
Anti Dandruff 3 54 99 -
HEAD & SHOULDERS
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Core Target Audience
Male/Female, 18-34 years
Core Equity
Superior Anti-Dandruff efficacy and superbly attractive hair
Key Features and Benefits:
Anti-Dandruff shampoo with ZPT & conditioner.
Removes flakes itchiness, irritation, dry Scalp & Oiliness- the five signs of
Dandruff.
Variants:
Smooth & Silky for Straighter hair: High conditioner level. Relieves hair
dryness to make the hair silky smooth.
Silky Black: High conditioner level. Has black sesame and walnut extracts
that nourish hair and scalp to make black hair look silky.
Clean & Balanced: Medium conditioner level. Has a cleansing system that
gives your hair a wonderfully clean look and feel.
SKU Line-up
Variant 7.5ml 100ml 200ml 400ml
Smooth & Silky 3 64 122 215
Clean & Balanced 3 64 122 -
Aloe Vera 3 64 122 -
Silky Black 3 64 122 -
Refreshing Menthol 3 64 122 -
Natural Shine 3 64 122 -
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Health Care
VICKS
Vicks is India’s No.1 Cough & Cold Brand. It created the cold & cough Over-the-
Counter (OTC) category in India way back in 1952 and has led the category till date.
Today it has completed more than 50 years in India. Its current portfolio in India
comprises Vicks Action500+, Vicks VapoRub, Vicks Cough Drops, Vicks Formula 44
Cough Syrup and Vicks Inhaler. It was rated as ‘India’s Most Trusted Brand’ by the
‘Advertising & Marketing’ Magazine and continues to be on top of the charts of Brand-
Equity surveys till date.
The Vicks business in India is the biggest in the ASEAN-Australasia-India (AAI) region.
Over the years, Vicks has launched several heart-tugging advertising campaigns, some of
which were – the ‘Happy Birthday Mummy’ and ‘Touch Therapy’ campaigns for Vicks
VapoRub, the ‘Khich Khich Dooor Karo’ ad for Vicks Cough Drops, the ‘Haan Bhai
Haan’ ad for Vicks Action 500.
Vicks VapoRub
Vicks Inhaler
Vicks Formula 44
Vicks Cough Drops
Vicks Action 500+
VICKS VAPORUB:-
Core Target Audience:
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Mothers with Children between 3-8 seeking comforting cold relief.
Core Equity:
Fast acting relief from the 6 symptoms of cold.
Key Features and Benefits:
Finds a place in every Indian home, due to its proven performance against
cold over decades.
Works on the 6 symptoms of cold blocked nose, breathing difficulty,
cough, body ache, congestion and headache.
Ayurvedic and safe for regular use. Contains Kapoor (Camphor), Pudinah
ke Phool (Menthol), Nilgiri Tel (Eucalyptus Oil).
Applied externally, so it is safer than pills and also doesn’t interact with
other medication.
Grooming & Personal Care
Gillette M3Power
The Gillette M3Power razor is the first battery-powered shaving system from Gillette
Gillette Mach3 and Mach3 Turbo
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Gillette's best manual razor for a close shave, with less irritation - Even when shaving
against the grain
Gillette M3 Power and M3 Power Nitro
The Gillette M3Power razor is the first battery-powered shaving system from Gillette.
After Shave Lotion
Combines the refreshment of a lotion with the masculine invigorating fragrance of Old
Spice
Pre-electric Shave Lotion
For a smoother, more comfortable shave, apply to the face prior to an electric shave.
Gillette Fusion Pre and Post Shave
A range of shaving gels and foam plus a post-shave Hydra Soothe Balm and Hydra Cool
Gel to calm your just-shaved skin
Gillette Fusion Manual and Fusion Power
Gillette's Best Shave in Manual and Battery Power.
The following products made by Gillette/Procter & Gamble contain PVC plastic
in the packaging:
Fusion Razor (20001906)
Mach3 Razor
Turbo Razor
Fusion Razor
Venus Vibrance Razor
Gillette For women - Venus razor blade
Gillette M3 Power razor blade
Gillette Sensor 3 for women razor blade
Gillette Venus divine razor blade
Gillette m3 power nitro razor
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COMPANY SWOT ANALYSIS
Strengths Weaknesses
Market Leader
Strong Brand Image
Global Presence
Aggressive Advertising
Quality & Innovation
Portfolio Range (Mach 3 etc)
Long Development Cycles
Relatively Static Market Growth
Heavy Dependence on High
Street Retail Outlets
Expensive Brand Maintenance
Demographic Changes
Changing Societal Attitudes
Consumer Brand Preference
Demand for High Quality
Use of JIT and ICT (e-com)
New Production Technology
Increased Grooming Sophistication
New Competitors
Cloning of Successful brands
Increasing Buyer Power
(Inventory De-stocking)
Growth in Substitutes
Own Label Fits
Economic Downturn
STRENGTH
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Gillette Clinical Strength is specially formulated to provide effective protection for the
heaviest of sweaters and men who worry about excessive underarm perspiration. The
Triple-Protection Technology provides three unique layers of protection, including
clinically proven prescription-strength wetness protection, odor-fighting microcapsules to
absorb odor and release a fresh, clean scent throughout the day and skin-conditioning
ingredients to minimize irritation. Gillette Clinical Strength contains the highest level of
active ingredient allowed without a prescription. It is less acidic than aluminum chloride
(used in many prescription antiperspirants) and thus, helps significantly reduce the
potential for skin irritation. In fact, in clinical studies, Gillette Clinical Strength was
significantly less irritating than a prescription product containing aluminum chloride.
Vibrating razor with an extremely close shave
smooth shave
5 blades taking off facial hair means less skin that can get in between the blades
Close shave, durability.
-Strong and well differentiated brands with leading share positions.
-Brand portfolio includes both global Unilever brands and local brands of specific
relevance to India.
-Consumer understanding and systems for building consumer insight.
-Strong R&D capability, well linked with business.
-Integrated supply chain and well spread manufacturing units.
-Distribution structure with wide reach, high quality coverage and ability to leverage
scale.
-Ability to deliver Cost Savings.
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-Access to Unilever global technology capability and sharing of best practices from other
Unilever companies.
-High quality manpower resources.
WEAKNESSES
Complex supply chain configuration, very large numbers of SKU's with dispersed
manufacturing locations.Price positioning in some categories allows for low price
competition. High Social costs (housing, foodgrains & firewood, health and other welfare
measures) in the plantation business.
OPPURTUNITIES :
-Brand growth through increased consumption depth and frequency of usage
across all categories.
-Market and brand growth through increased penetration especially in rural areas.
-Upgrading consumers through innovation to new levels of quality and
performance. Emerging Modern Trade for introduction of more up market
Personal Care products. Growing consumption in Out of Home categories.
-Establishing HLL as a sourcing hub for Unilever companies in various countries.
Leveraging the latest IT technology.
THREATS
Increased consumer spends on education, consumer durable, entertainment, travel etc.
resulting in lower share of wallet for FMCG. Aggressive price competition from local
and multinational players. Grey imports. Spurious/counterfeit products in rural areas and
small towns. Changes in fiscal benefits. Unfavourable raw material prices in oils, tea
commodity etc.
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• BLADES & RAZORS STRATEGY
Innovation through Research & Development
Premium Brand - Premium Price
Build Global Product Branding
Build Strong Brand Loyalty
Greater Efficiency at Lower Cost.
Maintain Superior Growth in Market Share
Build Shaving Systems Sub-Segment
Invest in technology and product innovation
FUTURE GILLETTE STRATEGIES
• High Branding/Quality - Premium Price
• Develop New Market Segments & Niches through R&D
• Maintain/Promote Strong Brand Loyalty
• Tailoring Demographic Targeting (E.g. US vs Europe)
• Reduction in Product Unit Costs
• Grow Razor Systems Segment
• Strategic Alliances (Suppliers and Distributors)
• Shedding Non-Core Businesses (E.g. Papermate)
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CUSTOMER RELATIONSHIP
MARKET MIX
The following contains the four elements of the marketing mix for the new Gillette
Venus.
Product Strategy
Gillette marketing mix depends mainly on the product and the product marketing, but we
are also leveraging a lot more in the packaging. Innovation is the key to our growth and
the opportunity for continual growth. Gillette product marketing has to emphasize the
benefits of unique combination of technological expertise and new innovation. Gillette
need to sell a sense of quality and comfort that will show in packaging. This particular
product outdoes all other female razor products as far as comfort is concerned. The
following are a few of the unique features that the Gillette Venus has to offer:
-Unique comfort strips to provide protection against razor burn. The shave bars flex
around for more detail, fitting into more difficult areas, such as knees and ankles.
From Boston to Bangkok, Johannesburg to Mexico City to Berlin, the modern traveler
encounters a Gillette product portfolio far broader, and a worldwide presence far
stronger, than any envisioned by the Company's founder. The Gillette Company today is
the global market leader in nearly a dozen major consumer products categories,
principally in the grooming, alkaline battery and oral care businesses.
In the more than 100 years since the Company was founded, Gillette has gained, held and
strengthened leadership positions through the Company's strategy of managing its
business with a long-term, global perspective. This demonstrated ability to generate long-
term, profitable growth in a changing global marketplace rests on several fundamental
strengths. These include a constantly increasing accumulation of scientific knowledge in
core businesses, innovative products that embody meaningful technological advances and
an immense manufacturing capability that produces billions of flawless.
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RESEARCH METHODOLOGY
OBJECTIVES OF THE PROJECT
In Today’s competitive market, every company wants to know the reasons how one can
have the potential market, which factors enhance the sales of the FMCG product. The
said information will be much useful for devising sales promotion. This research is also
devoted regarding sales promotion for increasing sales of the P&G Company. The
present study is conducted entitled “CRM ACTIVITY: A CASE STUDY OF GILLETTE
BRAND OF P&G”
The research objectives to be studied in this research are as follows:
1. To study the present distribution channel of the P&G product in Delhi.
2. To study the concept of CRM.
3. To study the impact of this CRM on sales of retailers & wholesalers.
4. To study the awareness about the CRM.
RATIONALE FOR THE PROJECT
An evaluation of current and future trends in crm, offering critical success factors for
creating and implementing customer focused strategies. To assess the potential returns
available from crm- investigates the tactics used to counter barriers to successful
implementation. To evaluate the competitive technology vendor landscape that
recommends best practice crm strategy and investment.
The main objective is to have a core insight to the pre and post changes in crm
implementation and problems faced during the course of implementation. It also
comprises of study about the process of crm activities.
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LIMITATIONS OF THE PRESENT STUDY
The present has following limitations.
1. It was somewhat difficult to get the questioner completely filled by the respondent
as most of the times they were busy and could not give sufficient answer and
sufficient information even though they have it and the information from
respondents are very important for the research.
2. Some of the respondents were that not much serious about filling the questioner.
3. Some of the respondents left some questions unanswered and as such it was little
difficult to draw and generalize the conclusion from them.
4. Some of them want to hide the fact so they did not respond and participated in the
survey wholeheartedly.
5. The findings entirely depend upon the willingness & mental condition of the
respondents.
Some respondents were unable to understand the question due to various problems like
language barrier
MATERIALS AND METHODS
Research design is the plan structure and strategy of investigation conceived so as to
obtain answers to research question and to control variance. It is the blue print for the
collection, measurement of data .It aids the scientist in the allocation of his limited
resources by posing crucial choices – is the blue print to include experiments interviews
observations, the analysis of records, stimulation in or some combination of these? Are
the method of data collection and the research situation to be highly structured?
A research design is simply the framework or plan for a study used as a guide in
collecting and analyzing data. It is the blue print that followed in completing a study .It
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resembles the architects blue print for a house. These results are interesting but they do
not solve the basic problem is a common latent. Thus a research design ensures that study
1. Will be relevant to the problem.
2. Will use economical problem.
As the outset may be noted that there are several ways of studying and tackling a problem
there is no single perfect design. As such, the researcher should not wait until he arrives
at a unique and perfect research design. Various authors have classified research designs
in different ways. Different types of research design have emerged on account of the
different perspective from which a research study can be viewed. However, a frequently
used classification system is to group research designs under three broad categories –
Exploratory, Descriptive and Causal.
TYPES OF RESEARCH DESIGN
1) Exploratory Research:
Research design the major emphasis is on gaining ideas and insights. It is particularly
helpful in breaking broad, vague problem statements into smaller, more precise sub
problem statement.
2) Descriptive Research:
Descriptive studies are undertaken in many circumstances. When the researcher is
interested in knowing the characteristics of certain group such as age, sex, occupation,
education level, or income, a descriptive study may be necessary.
3) Causal Research:
As the name implies a causal design investigate the cause and effect relationship between
two or more variables
The type of research, which has been chosen for the present study, is exploratory
research.
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DATA COLLECTION
Primary Data: -
Primary data is collected through survey method. Survey method involves collecting data
by administrating a structure or non-structure questioners. The questionnaires were
prepared using very simple and non-technical words. To serve the wholehearted co-
operation without wasting more time of respondents, the questionnaire was short and to
the point. To collect the relevant data for a research data will be collected in the form of
questionnaire designing. Designing the questionnaire is not easy job it will be formulated
in carefully means which type of information to be collected, type of questions, question
wording, sequencing and layout and presenting these all of things are designing in well
manner
The questionnaire design procedure follows following steps. The said questionnaire is
attached in the appendix section.
Fig: Questionnaire Design Steps
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Specify what information will be sought
Determine wording of each question
Determine sequence of each question
Prepared for final data collection
Determine type of the questionnaire and method of administration
Determine forms & response to each
question
Determine consent of individual question
Determine physical characteristics of questionnaire
Re-examine step 1-7 by testing questionnaire
Secondary Data: -
Secondary data is required for collecting the information of the company the related
information of the FMCG product. This data is collected from the related company
website, magazines, journal and Textbook.
SAMPLE SIZE AND SELECTION PROCESS
Once the researcher has clearly specified the problem and developed an appropriate
research design and data collection instrument, the next step in research process is to
select those element from which sample will be drawn.
The sample selection process requires the form of sample be specified. For this purpose,
researcher has subjectively decided which particular group will be part of the study.
In a sample survey a small part of the entire population is subjected to the research. This
sample is considered to be the true representative of the entire universe and decided upon
certain criteria.
The sample size has been kept to 50 as it was considered large enough to reliable result.
After the sample size is decided, the next step was to meet the respondent personally and
to collect data from them through personal interviews.
After conducting the personal interview of the respondents the next step was to arrange
the collected data finally coded and tabulated to obtain the results. The present study used
MS Excel package for the purpose of tabulation, which allows all kind of elementary
statistical calculation. After tabulation the data was ready for calculations to draw
necessary inferences.
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FINDING AND ANALYSIS
1 Had you heard about company Gillette from P&G?
Awareness about the Gillette
Yes 74
No 26
Gillette India has a very old presence in world wide while judging this statement we did
brief survey of 100 People and according to our out put the data 74% people are actually
aware about the Gillette as a brand name and the Gillette . While still 26% people still
not aware about the Gillette
Gillette need to focus to target 26% those people who doesn’t know about the Gillette .
Customer satisfaction and loyalty would come if the customer aware about the Gillette ’s
so effectively only 74% customer who knew very well what Gillette doing in the Indian
market and what available is for the customer.
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If Yes
2 How you came to know about this company?
Awareness about the Gillette
Newspaper 40
By Friend 17
Means of Advertisement 62
Self Research 42
Hoarding 52
Retailers 10
How people got to know about the Gillette , there is various ways. Once customer know
about the company brand so for Gillette in my project effective people for the survey is
223 because they know about the Gillette ’s brand name. people got to know about the
Gillette from various parameter, like 23% people got to know about the Gillette through
Hoarding while 28% people got to know from the advertisement that is doing by the
company while 19 % people knew Gillette ’s brand through the self research and news
paper is only effective by the 18%. Recommendation to increase awareness among the
customer for Gillette can be focused more to hoarding advertisement rather than the
news paper also self research contributed maximum so Gillette brand awareness so
Gillette increase to advertise on internet, book etc.
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3 How would you rate s of company?
Customer satisfaction from
Excellent 34
Very Good 76
Good 85
Poor 28
Out of 100 valuable customer for our survey it seems that 15% rated Gillette ’s as
excellent in quality while 34% rated as very good experience that they have while using
Gillette ’s and 38% people are rated as good to using Gillette ’s .
Recommendation about the Gillette would be 13% people rated Gillette as poor one so
company need to focus on those area why people rate as a poor why they perceive that
Gillette ’s quality is poor.
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4 How would you rate services of the company?
Customer satisfaction from Services
Excellent 50
Very Good 67
Good 57
Poor 49
Recent survey conducted by the Business standard and it shows customer satisfaction
also depends upon what is you sales after service strategy, according to our survey about
the Gillette 22% people rated Gillette as a excellent service provider while 30% rated it
has very good sales after service support and 26% rated good for the service to Gillette ’s.
The concern area for Gillette is 22% people who rated Gillette service as a poor one and
not which is one of the area where customer are not satisfied so for the Gillette it need to
be justify and fill the gap as soon as possible.
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5 What is your overall opinion about the service provided?
According to our survey result overall customer satisfaction level from the various
service like warranty, customer care, etiquette of the employee people are saying it is
good company with providing day by day better service.
Some people says Gillette as a organization not having flexible service to the customer
like 24*7 wise also some time they are arrogant to the customer.
6 Did you have any suggestions to improve the services?
Few Suggestions is
24*7 customer support
All India one warranty card
Better replacement if is not good.
Phone of live facility to take a brief about
7 What problem did you face while getting s serviced?
Employees are at times not having manner to talk
Fault occurrence after get repaired the
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8. Did you find the s up to the standard or Marks as specified before purchase?
Standard
Yes 201
No 22
Before purchase customer are very cautious about the quality and it’s standard in the
case of Gillette about 90% people are happy with the kind of quality that they would
received before purchasing the Gillette . While only 10% people are not satisfied the
quality of Gillette .
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9. Are you using other company are (Same type of s) simultaneously?
Comparison with
Yes 218
No 5
Using Gillette with the other company which gives insight to know more about the
competition level for the Gillette now we got very surprisingly result 98% people says
yes while using Gillette they also using some other company . So kind of competition we
can feel that Gillette has. Only 2% people using Gillette. Which quite less than the other
favorable out put
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10 Would you recommend company’s s to others?
Recommendation to other
Yes 219
No 4
Recommendation to other means customer buy the due to influenced by the others also
which shows very beneficial for the company. 98% people who is using Gillette is ready
to recommend others to use Gillette which is very positive sign for the customer. Now
move to other strata 2% only those people who doesn’t want to recommend Gillette to
others
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CONCLUSION
Before we begin to examine the conceptual foundations of CRM, it will be useful to
define what is CRM. A narrow perspective of customer relationship management is
database marketing emphasizing the promotional aspects of marketing linked to database
efforts.
Another narrow, yet relevant, viewpoint is to consider CRM only as customer retention in
which a variety of aftermarketing tactics is used for customer bonding or staying in touch
after the sale is made.
Shani and Chalasani define relationship marketing as “an integrated effort to identify,
maintain, and build up a network with individuals consumers and to continuously
strengthen the network for mutual benefit of both sides, through interactive,
individualized and value-added contacts over a period of time”.
The core theme of all CRM and relationship marketing perspectives is its focus on co-
operative and collaborative relationships between the firm and its customers, and/or other
marketing actors.
CRM is based on the premise that, by having a better understanding of the customers’
needs and desires we can keep them longer and sell more to them.
Growth Strategies International (GSI) performed a statistical analysis of Customer
satisfaction data encompassing the findings of over 20,000 customer surveys conducted
in 40 countries by Infoquest.
The conclusions of the study were:
A Totally Satisfied Customer contributes 2.6 times as much revenue to a company as
a Somewhat Satisfied Customer.
A Totally Satisfied Customer contributes 17 times as much revenue as a Somewhat
Dissatisfied Customer.
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A Totally Dissatisfied customer decreases revenue at a rate equal to 1.8 times what a
Totally Satisfied Customer contributes to a business.
By reducing customer defection (by as little as 5%) will result in increase in profits
by 25% to 85% depending from industry to industry.
An important facet of CRM is “customer selectivity”. As several research studies have
shown not all customers are equally profitable (Infact in some cases 80% of the sales
come through 20% of the customers). The company must therefore be selective and
tailor its program and marketing efforts by segmenting and selecting appropriate
customers for individual marketing programs. In some cases, it could even lead to “
outsourcing of some customers” so that a company better utilize its resources on those
customers it can serve better and create mutual value. However, the objective of a
company is not to really prune its customer base but to identify appropriate customer
programs and methods that would be profitable and create value for the firm and the
customer. Hence, CRM is defined as:
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RECOMMENDATIONS
Some of the Recommendation for Gillette that I analyze after making my project report is
following below.
Out of our 100 sample size 26% people still not aware about the Gillette product
so Gillette need to focus on more product awareness because it is the first and
foremost thing for any organization
Recommendation to increase awareness of customer for Gillette company my be
focused more to hoarding advertisement rather than the news paper also self
research contributed maximum awareness to the Gillette brand so Gillette increase
to advertise on internet, book etc.
Recommendation about the Gillette would be 13% people rated Gillette product
as poor company need to focus on those area why people rate as a poor why they
perceive that Gillette product’s quality is poor.
The concern area for Gillette is 22% people who rated Gillette service as a poor
which is one of the area where customer are not satisfied so for the Gillette it need
to be justify and fill the gap as soon as possible.
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FUTURE PROSPECTS
From the data interpretation and conclusion there are some suggestion, which can help
company to build up strong position in market and to increase the sale of products.
As, it is to be known that advertisement and promotional activities plays a vital
role in influencing the purchasing decision of the product so P&G should invest
on advertisement.
P&G should more concentrate on facility like on time visit, replacement.
The company should promote the Golden Store Scheme to all categories of shops.
The company should keep watch of the competitors schemes.
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BIBLIOGRAPHY
1. C.R. Kothari, “ Research Methodology”, second edition, Wishwa Prakashan a
Division of Wiely Eastern Limited Pune, new Delhi-110001.
2. Philip Kotler and kenin Lane Keller, “ Marketing Management” Twelfth edition
Prentice Hall Of India PVT. LTD New Delhi.-110001.
3. http://www.p&g.com
4. http://wikipedia.org/wiki/pune
5. http://www.google.com
6. HARISH KUMAR(sales manager,p&g)
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QUESTIONNAIRE
1 Had you heard about company Gillette from P&G?
(a) Yes (b) No
If Yes
2 How you came to know about this company?
(a) By Newspaper (b) By Friend
(c) Other Means of Advertisement. (d) Others (Specify) _________________
3 How would you rate company?
(a) Excellent (b) Very Good
(c) Good (d) Poor
4 How would you rate services of the company?
(a) Excellent (b) Very Good
(c) Good (d) Poor
5 What is your overall opinion about the service provided?
__________________________________________________________________
__________________________________________________________________
6. Did you have any suggestions to improve the services?
__________________________________________________________________
__________________________________________________________________
7. What problem did you face while getting p&g serviced?
__________________________________________________________________
__________________________________________________________________
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8. Did you find the products of p&g up to the standard or Marks as specified before
purchase?
(a) Yes (b) No (Specify)___________________
9. Would you recommend company’s s to others?
(a) Yes (b) No
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