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Is Detergent Market Monopolistically Competitive?
Presenting by –TRISHA SINHA ROY(8629)
Indian Detergent Market Landscape
Detergent
Powder Bars Liquid
Detergent Market growing with a CAGR of 13.06% from last 5 yearsSource : India Detergent Market Overview 2016-2021 - Research and Markets
Indian Detergent Market Landscape
1959 •HUL launched Surf Excel.
1969 •Nirma was launched.
1987 •RSPL launched Ghari.
1988 •HUL launched Wheel.
1991 •P&G launched Ariel.
2000 •P&G launched Tide.Timeline:
Nature of the Monopolistically Competitive Market
• Product Differentiation• Large number of Firms• Freedom of Entry & Exit• Independent Behaviour• Industries & Product Groups• Falling Demand Curve• Selling Costs• Active Price Competition• Non-Price Competition
Showing Category-wise Detergent Brands & the Percentage of their Market Shares
Categories of Detergents
Detergent Brands
Market Share
Premium Ariel and Surf 15%
Mid-price Henko, Rin and Tide
40%
Popular Wheel, Ghari, Nirma & Mr.
White
45%
Source: https://www.ukessays.com
A Case Study of
A Brief History of Nirma• In 1969, Dr. Karsanbhai Patel started selling Nirma in Gujrat and went on to
sell it nationwide by 1985• Targeting poor consumers, mostly in rural areas • Low-cost manufacturing process, wide distribution network, special
packaging for daily purchasing & value pricing• Nirma had a 15.2% share of the detergents segment & an 8.2% of soaps in
April 2006• By June 2007, its market share had dipped to 13.5% in detergents & 6.74%
in soaps• Company’s share price also fell 24% • In December 2007,Nirma’s sales grew 4.3% year-on-year to Rs1,918.8 crore
while its net profit fell 15.2% to Rs241.38 crore• In the quarter ended 30th June, sales grew to Rs609.1 crore against
Rs525.5 crore in the same quarter last year, while the net profit fell 45% quarter-on-quarter to Rs41.1 crore
Source: https://marketingbyvijay.wordpress.com http://www.livemint.com/
HUL’s Change in Market strategy(Post 1995)
• Change in business model• Registered 20% growth in revenue/ annum• 25% growth in profits/annum• Market Capitalization grew by $12 billions• Adopted the bottom of the pyramid as a
Corporate Strategic Priority
Source: https://marketingbyvijay.wordpress.com
Downfall of Nirma
• Lack of Innovation• HUL was able to establish products in all
segments; Popular:Wheel , Mid-Priced: Rin and Premium:Surf
• Lack of Advertising• Lack of Product Differentiation• Lack of Price Increase
Change in packaging Over Years
Price CompetitionQuantity MRP of
Nirma ( in Rs.)
MRP of Ghari (in Rs.)
MRP of Wheel (in Rs.)
500gms 25 26 32
1Kg 43 49/50 49
Source: www.weareopen.in
Market Share of Detergents
17.3%
16.9%
13.5%
<6%
Brand-Wise
Ghari Wheel Tide Nirma
15%
40%
45%
Premium Mid-Price Popular
Category-Wise
Source: https://http://ankitmarketing.blogspot.in/
What Nirma could have done in order to prevent the downfall
• Compete on Quality• Strategic Positioning• Attractive Advertising• Co-operating Contributors• Weightage in Packaging
References• https://marketingbyvijay.wordpress.com/2014/07/07/nir
ma-vs-wheel/
• https://www.ukessays.com/essays/marketing/market-leader-in-soaps-and-detergents-industry-marketing-essay.php
• http://www.businesswire.com/news/home/20160314006184/en/India-Detergent-Market-Overview-2016-2021---Research
• http://indiatoday.intoday.in/story/hindustan-lever-limited-cuts-price-of-wheel-detergent-bar-draws-flak/1/307169.html
• http://www.livemint.com/Companies/qgXuYPLMoMFYV6jzJ942NP/Nirma-losing-froth-in-soaps-detergents-biz.html
• www.weareopen.in/Home-&-Bath-Care/Washing-Soap
Thank You