Sie sind auf Seite 1von 8

232 RU RA L MARK ET ING

<

The essential characteristics offolk media are that they are in- teractive, repetitive and narrative.

6. Detailing and understanding other relevant rural communication tools like sales promotion and events and experiences

Sales promotion consists of various incentive tools, which are mostly short term and are designed to stimulate and induce trial and make the offer attractive for early conversion by consumers or trade. It includes tools for consumer promotion-samples,

coupons, discounts, free gifts, rewards for loyal customers , 1\I displays and demonstrations; trade promotion - price advertising and display allowances, free goods.

In the rural context, one of the best ways to capture theatt& tion of the audience is through events. Since rural areashat limited venues for entertainment, conducting a good,wrI planned event in rural areas elicits a good response, a n dgs the brand the right mileage through a visually strongi rnp al and long-term brand recall. Some prominent forms of rum events are sports events, consumer /farmer meets and chanrj partner meets.

DISCUSSION AND APPLICATIO N

Discussion of Concepts

1 .

Explain the steps involved in message design. Develop a communication message for promoting hybrid seeds and pesticides .

3.

2.

Briefly describe the various communication tools that can form a part of the rural communication mix strategy.

4 .

Application of Concepts

1 . Devise a comprehensive communication

strategy for a

3.

regional brand of toothpaste

Identify the dimensions that will help to distinguish the

communication strategy.

2. Critically examine the communication strategy of a na- tional and regional player in the durables category in rural markets.

in any two Indian states.

Describe different forms of folk media. What are thebe!; efits of using folk media? What are the critical pointsto~ kept in mind while using folk media as the communo tion platform?

Explain the different sales promotion tools used in rurI communication with examples.

An international processed food manufacturing comp~ has come up with its new fortified products (biscuitsand snacks) which it wants to promote in iron-deficient rural areas of India. Devise a communication plan for the COlli· pany to help it to effectively communicate its message .

RURAL MARKETING CASE

".

TATA SHAKTEE GC SHEETS

of the product portfolio of Flat

Products Division. The Flat Products team at Tata Steel, managing the Tata Shaktee brand of GC sheets, was contemplating the brand communications budget.

Galvanized Corrugated (GC) sheets are a part

The TATA Shaktee Brand over the years

Galvanized corrugated sheets are mainly used for roofing in rural houses. They are also used for making sidewalls and shop extensions, and for sheds for cattle, storage, etc. Competing products include thatched roofs, and tile and asbestos cement sheets, which have a distinct price advantage; and to a small extent reinforced concrete cement or RCC, which is relatively very expensive. RCC is preferred by rural consumers for roofing.

Tata Steel was the third largest producer of GC sheets in the country, and had a market share of 9 per cent in 2000. The Flat Products team had set the objective of becoming market leaders in the Indian steel roofing market. The focus was on rural housing, and on segments detailed in Table 1.

Table 1 Consumers of GC sheets

Consumer

R2, R3, R4 sections of rural society Internet

Characteristics

Lower literacy levels, very cost conscious Farmers, shopkeepers and labourers Concerned about product quality, but lack sophs- tication and technical knowledge Susceptible to retailer push/influence High involvement purchase Purchase usually happens from feeder towns

The Tata team had identified an opportunity to differentiate and establish their brand by focusing on delivering more value to their target consumers. This was based on brand differentiation on some major consumer concerns and needs, which were unfulfilled, namely:

1. Nee In r ur a l and kn based a

3.Ne

Cansu to en servic the r i

t

> COMMUNICATION STRATEGIES FOR RURAL MARKETS

CHAPTER 9

233

POP

-offs,

tten-

have

well -

gets

pact

rural

1 . Need for more durable and cost-saving roofing products In rural territories, word of mouth and dealers' recommendation plays a role, andknowledge is less technically sound. Consumer evaluation of the product is basedon product parameters like weight, size, etc.

2.Needfor assurance on fair price and good quality Theperformance of the sheets depended on many factors including the usage purpose,as well as the quality of the product and method of using and storing sheets.

el

•••

. ben-

to be

3.Needto buy from a reliable outlet Consumers'concerns if they invested in a costlier brand of GC sheets were to ensure that the retailer was trustworthy, was not only delivering the right servicesand dispensing the correct usage advise, but was also quoting them theright price/brand .

Ina market seeking assurance and fair play, brand identity would playa ma- jorrole if a brand took up the opportunity and challenges. The category audit revealedstrong challenges at four levels: the consumer connect, market itynamics,immediate competition, and the channel structure aqd trade prac-

ica- ticesand norms.

rural

l p a ny and rural

corn-

I

ge.

5

Thestrategy adopted to tap into this opportunity rested on strengthening their brandingof GC sheets, the Tata Shaktee. It was positioned as a high value

optionfor GC sheet users in rural India, especially for roofing needs. Tata Shak- teewas re-Iaunched in 2000 in the retail construction segment. The strategy wasto create consumer intimacy, and establish a unique identity and robust

distributionnetwork that enveloped the customer till the last mile. The key implementationchallenges were to communicate the brand meaning and iden-

tityand create the right distribution channel, which would

trustedsource of GCsheets for consumers, a source that would be transparent, accessibleand, fair in pricing. Providing peace of mind to the consumer was a drivingfactor, through pricing, quality and brand assurance. Credibility would bea major pillar of the Shaktee brand, and would drive the commodity mar- ketto recognize value in brands. It would also impart a unique differentiator to thebrand.

create access to a

D istribution Channel for Tata Shaktee

Retailersof hardware, paint, cement, plywood, etc. are located mainly in feeder towns(those towns with a population greater than 20,000). Most retailers sell mu~iplebrands.

Coupledwith the strengths of the Tata Shaktee GC sheet brand itself, this was expectedto bring about the re-shaping of the market towards a brand versus commoditycompetition.

his- BrandCommunications

h their

is was

needs,

TataShaktee became a market leader in branded GC sheets, ranked first in thecountry by share and unit weight. The company's approach was to create consumerintimacy through various means. One was through creating a unique ~entityfor the Tata Shaktee brand, such that the value proposition to consumer wasclearly established as a higher value than the competition. This higher value

wasbased on the pillars of brand differentiation, and a unique identity was

proposedto be established in consumer perception around these four dimen- sionsThe. challenge was to create awareness and establish the brand identity andproposition.

The Tata Shaktee Brief

The brand communication requirements were spelled out with the above sce- nario in mind, and the following objectives were crystallized. Customer intimacy was to be established through communicating the unique brand identity and advantages through various communication channels, including direct commu- nication to the end consumer.

Communication Objectives:

1. Creating brand awareness of Tata Shaktee GC Sheets brand proposition

2. Product demonstration

3. Building a relationship with the customer and creating brand loyalty through a burst of below the line promotional activities

The Communication Challenge

The challenge was to promote the brand's consumer value-add through effec-

the rural-end consumer and decision maker. The

first objective of the campaign was to communicate the benefits oITata Shaktee vis-a-vis other brands.

Since this was the only company to launch extra width GC Sheets, the benefits of the much wider GC sheet-like the significantly lower cost of construction (attributed to the less number of sheets and accessories required to cover the same areal-was to be communicated to customers, and linked to the brand name. The brand also had many other features that would position a clear point of differentiation: RCP,zinc coating benefits, 120 GSM, etc. These features were technical in nature and difficult to explain to consumers who were less literate, and often not aware of technical issues of the building trade.

tive communication directly to

The other communication challenge was to create direct communication op- portunities that allowed product demonstrations. It had to be an opportunity where something as cumbersome as a GC sheet could be wielded and put up for a demonstration.

Critical issues identified during the client-agency interactions were as follows:

• The buyer, mostly the head of the family, who makes decisions relating to purchase/financials spends the maximum time in his fields during the day.

• Tata Shaktee charges an INR 10 - 15 premium per sheet over other brands.

• Technological superiority like RCP,120 GSM Zinc coating are difficult to com- prehend, and is to be communicated in simple language and in terms of utility to consumer.

• Variations within Hindi as a language of communication.

• Being a durable product, opinion leaders like mistris (technicians incharge of placing roofs) play a role because of the rational decision-making process.

• Communication needs to focus on demonstration and touch and feel for greater impact.

Solution (Efforts Made by the Agency)

Phase I (2001 -3)

In the first phase, the communication medium chosen by Tata Shaktee were wall painting, shutter/shop painting, VOW (Video on Wheels), POP(Point of Purchase) displays but these did not yield the desired result.

234 RURAL MARKETING

Learnings from Preliminary Field Visit:

Product/Brand point of view: Favour

• GC sheets are lighter than asbestos sheets/tallis/thatch, and require a lighter understructure

• GC sheets are easy to re-Iocate compared to asbestos sheets/tallis/thatch

• GC sheets have a longer life (15-20) years as compared to other co- categories

• GC sheets are fire-resistant

• Tata sheets enjoy good brand equity in the market

• Tata is the only GC sheet with product specification printed on it

Product/Brand point of view: Against

• GC sheets are more expensive than asbestos sheets/thatch roof/tall is as a product, but when the total cost of roofing (understructure, cladding material and labour) is considered, GC roofs are cheaper

• A house with a roof made of GC sheets is hotter compared to those with roofs made of other materials

• Consumers are shifting to thinner GC sheets since prices have increased by about 30 per cent. Tata Shaktee does not have any product offering in thinner sheets.

• Competition (Jindal National) product range starts from 0.14 mm thick, whereas Tata starts from 0.25 mm

• The price of Tata sheets is about 5 per cent higher than the nearest signifi- cant competitor

Consumer point of view: Favour

• Consumers shifting to GC sheets from thatch/tallis as it lasts longer

• The usage of asbestos sheets is declining rapidly due to health hazards

• Consumers are concerned about the safety and security of their families and prefer fire-resistant GC sheets

• The rural consumer feels that the Quality of Tata sheets is better than the competitors

Consumer point of view: Against

• The target segment for GC sheets is R3 and R4, who are very price-sensitive

• The low literacy level of the consumer means that he can be easily duped by the retailer

• Less knowledge about the product specification printed on Tata sheets and its implications.

The visit also brought out the fact that in this customer segment, buyers have low literacy levels, are susceptible to duping, have limited purchasing power, and are multilingual even within this segment, across states and regions.

Therefore, the challenge from a communication point of view was to establish a communication channel with the consumer, and propagate awareness and value of the brand.

MART's Strategy for Direct Customer Contact

The possible alternate channels of communication and below the line tools con- sidered by MART were:

• Use below the line media

• Public platforms to engage with rural customers

- Agricultural mandis

- Sugar mills

- Kisan Mela organized by Agricultural Universities

- Special meets

- Live demonstrations in rural large format retail stores

- National fairs

It was thus decided to focus primarily on utilizing rural congregation platforms

like haats and melas to reach out and educate the rural masses on product! brand benefits, and possibly create an experiential opportunity. The haat is the

business nerve centre, where visitors are in a buying mode.

Learning from the Pilot Project

After the pilot, Tata Steel decided to put a hold on roll out in melas, as it was the less appropriate platform from which to start off. The category purchase behaviour is such that the entire family does not playa major role; it is usual~ the head of the family or the chief wage earner who needs to be targeted. Me· las are occasions for the entire family, and involve both purchases of essential and non-essential items, and are sources of entertainment. As melas are seen more as an entertainmenVfamily outing, it was jointly decided to drop themas

a promotional platform.

Campaign Roll Out in 2004

The agency embarked on its roll-out plan with the help of local field implementa· tion partners. Due to this, the dealer could not participate, and the consumer's technical Queries about the product remained unanswered. Also, a samplesheet could not be displayed because the company dealer was responsible for the physical transportation of the GC sheet. A mismatch in the location of haatand dealer also inconvenienced consumers, as they had to travel long distancesto

purchase the Tata Shaktee GC sheet

the promotional team. It was felt that the company would have to ensurethe availability of consumer price lists and a scheme with a fixed validity period,as well as the presence of a dealer and sample sheets at the haat promotion.The company should also ensure the availability of both the normal and the wider GC~heet samples at the haat.

after learning about it at the haat from

Haat Hungama Campaign-2005

Additional promotional material was planned for 2005 over the previousyear's campaign.

• A Haat Hungama welcome stand (to greet visitors coming to the stall)

• Set of flash cards (five famous Indian monuments and three hit filmi jodis, brand game)

• Tata Shaktee flip chart (for uniformity in communicating with consumers)

Campaign Roll Out in 2006

During the activation phase, the team was instructed to take a sample sheet from the distributor/dealer and place it on a carrier mounted on the travellingve- hicle. This ensured the availability of sample sheets at all haaVmandi locations. Haat Hungama 2006 was also spread over 2,000 haats/mandis, and wasa major success in further strengthening the Tata Shaktee brand and its attributes and increasing brand salience and patronage among rural consumers.

COMMUNICATION

ST RA TEGIES FOR RURAL MARK ET S

CHAPTER 9

235

Tata Shaktee Haat Hungama Campaign from the C ommunicator's Viewpoint

The AIDA model of communication (Baldwin and Ross, 1992), although pos- siblythe oldest, is an effective response-hierarchy model, and was chosen as

the basis for the first-level brand communication objectives. Tata Shaktee Haat Campaign2004 started off as a basic-level campaign with the sole objective of registering its brand in the consumer's mind and increasing his awareness, comprehensionand knowledge of the brand. Therefore, it was limited to fulfill- ing the first two elements in the AIDA model, that is, Awareness and Interest.

the branding of the campaign was done as Tata Shaktee

HaatHungama and the specific brand theme was christened: "Sardi garmi ya barsaatTataShaktee hardam saath", that is, Tata Shaktee promised to be with the consumer in any and every season, be it summer, winter or the monsoons. Interactivebrand games centred round this broad campaign theme were de- signedlike a set of flash cards (five famous Indian monuments and three hit jodisfrom Bollywood/cricket).

Consumerswere asked to identify the monuments and the faces of the hit pairs of actors (the card showed a face that was half male and half female), and the winner walked away with a gift. Consumers were also explained the logic of designingthese games and how, with the usage ofTata Shaktee GC sheets, their homeswould last longer, just as the monuments had survived the trilvails of time and like the hit pairs of actors, who have had an association that has strength- enedover the years. In brief, the 2005 and 2006 campaign focused not only on awareness,but also convinced the consumer and aroused desire for/interest in the brand, finally motivating the consumer to take the next step of visiting the nearbydealer's place for more specific enquiries and conversion to sales.

In 2005 and 2006,

Im pact of the Tata Shaktee Haat Hungama Campaign

There was a 40 per cent increase in footfalls at the Tata Shaktee haat stall (yearon year basis), an average footfall of 600 visitors per haat stall, a total of

3.5 million potential consumers contacted over five years and a 37 per cent upswing in sales. The Haat hungama campaign started off with less involvement from the distributor/dealer, but slowly caught up by the third year. During the campaign, the Tata Shaktee Distributor ASO was present in 92 per cent of the cases, the product displayed in 93 per cent and the dealer present in 84 per cent of the haats. The campaign seemed effective from this point of view.

The Brand Communication Options

The communication media being used currently rested on interactive media directly reaching the rural audience. Video on wheels, innovative media like bullock and camel cart displays, the mobile vans in haats (van with GC sheet display), the Bollywood road show and street plays were all being used along with dealer-based stalls at haats, and games and displays to bolster the in- volvement of consumers at haats. The agency also suggested a communication- cum-sales lead generation system-an enhanced effort that went beyond the haats by using teams of youths who would visit haats, mandis, as well as con- duct direct consumer visits during the haatlmandi off-days. These would be local youth who might even be personally known to consumers.

The Shaktee stores also used point of purchase materials and structures to create the Shaktee Sansar (World), meant for both loyal and multi-brand stores, and enhanced the consumers' experience of the brand.

Discussion Questions

1. What is your assessment as a marketer of the opportunities shared by Tata Steel, especially when looking at rural markets?

2. What do you feel about the brand features? Is this relevant to the context we are talking about?

3. What do you propose as a strategy for Tata Steel? Describe each step that you wish to take in detail.

CAS

E

v

Leader Hits Back

At Colgat e -Palmolive India Ltd . (CPIL) , the question is how to fight back and take charge of t h e mark et tha t is nearly lost to Hindustan Lever Ltd (HLL).

,

GLORIOUS PAST

Till the late 1980s, it was pretty much smooth sailing for CP I L . Smaller toothpas t e b r and s li k e Pro mise, built a strong franchise i n the early 1980s and then began to flag . Othe r s , such as F o rh an s an d Bi n aca (that later became Cibaca, and is now part of Colgate), faded away into the background . T he n ca me Lever . For decades, oral-care had been a single-p r oduct market with Colgate ' s white paste offering t h e twin benefits of dental hygiene and bad breath prevention (with its 'ring of confidence ' pledge). Riva l s s uc h as Promise had not tried to change the market's basic rules; they had only tried to hew out niches for themselves. But now suddenly, in the late 1980s, Lever wanted to change the very way the market was carved up . It was moving aggressively to segment the market into two distinct need areas , with sharply defined brand s for each: Close-Up, a gel paste, for conveyable fresh breath (a youth need) and Mentadent for strong gum s and healthy teeth (a task taken on later by Pepsodent). With Lever's advertising , the very dynamics of toothpaste marketing started changing . Soon e no u g h, the white paste was viewed as a boring paste for oldies, and CPIL had to counter each of Lever ' s bran d s with offerings of its own . The great toothpaste war had begun . Colgate matched C l ose-Up w i t h a gel variant of its own, aimed at those who wanted to keep the i r partners happy (perhaps even attracted b y th e ir breath) . Simultaneously, CPIL ' s regular paste turned up the volume on tooth-de cay-fighting benefits. F o r both these campaigns, teenagers and children were the focus of attention . Lever had a stronger distribution network to leverage, and i t s advertising blitz was paying off. W hat it had done to one-time leader Halo shampoo of CPIL, it was keen on doing in toothpaste . Its ea rli er forays, with Signal and Pepsodent , had been disasters . But this was the 1990s , and now with Close - Up l ea di n g the charge , and with urban youth more receptive to a proposition of getting up close wi t h the opposite se x, the company was finally making headway. Ove r the ea r ly part of the decade , Lever made rapid ga i n s in market share, rising from almost nothing to a fifth of the toothpaste market .

216 Cas e s in Rural Marketing

C P I L b ro ught C o lgate Total , a top end formulation of its US-based parent, to India, priced at 2.5 times

its regular paste. The product failed to justify its premium to the consumer, this tartar-fighter was supposed to be the knight in shining armour , and its failure dealt a severe blow to CPIL's leadership of the market .

M eanwhile, Colgate ' s advertising had become 'globally aligned ' with US-based Young & Rubicam (which

Close-Up even used the

historical story of Salim ' s love affair with Anarkali.

had st a rted looking up to Lever with a combination of awe and reverence. India's most admired FMCG mar keter had managed to contain the challenge posed by Procter & Gamble (P&G) in detergents, and

vi rtua l l y demolished the P&G-Godrej alliance in the soaps market . The buzz now was that P&G wouldn't

dare launch i ts toothpaste, Crest , for fear of Lever-rather than CPIL . No wonder market analysts were

t ied up with Rediffusion

in India), and lost some of its local zest. Meanwhile,

In fact,

by the mid-1990s, FMCG market analysts

ta

lking of Lever's ascendancy to the top in this category as an inevitability.

C

olgate F i ghts Back

But CPIL saw the opportunity .

crore) toothpaste market had barely grown 3 per cent in 2000 (down from 6 per cent the previous year and

tonnes, ( Rs. 200

The market expansion was to be done as the

90,000

12 pe r c ent before that) .

"There's been very little conversion to the toothpaste market," admits Vikram

K aushik , Marketing Director, CPIL . There is a need to raise the entire consumption pyramid's value.

Colgate ' s Product Strategies:

Segment

Brand

Price Rs' (100 g)

Top End

Colgate Total

36

B

reat h fr eshness Segment

Colgate Gel

35

O

ral H yg iene segment

Colgate Sensitive Care

38

Regular Paste

Colgate Dental Cream

30

Natural

Colgate Herbal

23

Econom y

Colgate Cibaca Top

,

16.50

Tooth Powder

Colgate Tooth Powder

19

At the m a r k e t ' s apex, Colgate Total, relaunched at a revised price, has started doing well in the past two

ye ars . T otal is a medically superior formulation that is big in high-awareness markets (such as Australia

wh e re it commands 12 - 15 per cent market share). "Ideally , Total should be the biggest sub-brand," says

S

t herap e ut i c al l y awa r e consumer group , it will grow only as consumers become seems j us t t h e perfect product to stimulate upgradations, for it satisfies oral

ass u ring the cons u me r bacterial-free mouth for 12-hours after brushing and clambering into bed .

Imp or ta ntl y, T ota l can upgrade users of gels as well as protective pastes . The strategy is expected to

un d o t h e 19 90s ' s egmentation by harmonizing the two different needs (of partner-satisfaction and oral

hyg ien e) t hat rem ai n split into two segments in the zone one rung below the market's apex. That too, in a

mo r e c l in i c al l y ef f ect i ve manner (the product addresses the root cause , the germs that cause bad-breath and

i n f e ct io ns t oo) . Does it stand a chance? It is hypothes i zed that people outgrow their teenage fixations the mselve s once t he y enter mature relationships . CPIL on its part could help with an advertising campaign

th at sho w s the value of transcending artificial market divisions .

at a

am uel ,

w ho w as earlier

heading

Colgate's

Australian operations,

"but

since

it is pitched

more aware" . Indeed, Total needs on a higher plane by

T h e action i n the economy segment is complex because of the presence of multiple brands. Balsara's

it as Colgate Cibaca Top in a

mo d e r nized packa g e . Co lgate Herbal , is launched as a part of its flanking strategy against Aim, a neem

Baboo l was al read y a succ e ss. Colgate acquired Cibaca and relaunched

toothpaste

Dental Cn

providing

conservati

toothpaste

THE REAl

The real g action. TOI to the pow

Adds

use either

therefore, i

73 per cer

North Indi sells its rer

RURALM,

Promotion

Promotior

In 1976, C

vans went

products, I

Overall, a

Associatio

total 30,00

aspiring dl

CPIL

teach chik

million ch

DISTRIBU

The philo ! consumers distributio

·

P

C

~

Colgate n

locations

weren'tw

retail kios

es

~d

~t .

:h

~e

its

:G

Leader Hits Back 217

toothpaste by Lever. Aim was a price aggressor, priced at Rs. 6 for a 50-gm tube almost half of Colgate

Dental Cream. Colgate Herbal

providing a value-added option (it contains Indian ingredients such as tulsi, neem, clove and mint) to the

conservative

by

sells at a premium overseas.

But it is priced to penetrate

in India

buyer of low-priced toothpastes who can't afford to move upscale yet. It is promoted as a

toothpaste with the 'science of Colgate and the goodness of nature'.

I

ld

THE REAL GAME

i't

The real game is at the lower end of the pyramid.

The

challenge

is to rouse the latent brand equity into

ire

action. Tooth powder users can be converted to the white paste, and below that, non-users can be converted to the powder. It is a market placed at 26,000 tonnes per annum growing at 2 per cent.

Adds Kaushik, "It's challenging that only about 4.5 out of 10 Indians use toothpaste.

Only 6 out of 10

The task ,

00 therefore, is to get people to start using a dentifrice product. With penetration still low in rural areas, w here

nd

im

use either toothpaste or tooth powder.

The other four use other stuff such as twigs or ash .

73 per cent of India's population lives, only 35 per cent of the population uses modem dentifrices" . In North India, Colgate's white powder, famous for its minty flavour, has a strong competitor in Dabur, which sells its red powder in highly fragmented states such as Bihar and Uttar Pradesh (UP).

RURAL MARKETING

Promotion and distribution are meticulously designed and implemented by Colgate.

Promotion

In 1976, Colgate launched "Operation Jagruti" programme, to create oral-hygiene awareness . Nearly 100 vans went deep into rural areas to generate trials through its 30-gm pack. While most of the FMCG products, reach only about 20,000 villages, Colgate reaches 60,000 villages and 18 million rural consumers . Overall, an important part of the education programme is CPIL's association with the Indian Dental Association (IDA). Over the past 25 years, CPIL claims to have reached out to 18,500 dentists (ofIndia ' s total 30,000) in 1,280 towns and cities. Colgate also sponsors dental conventions and gives scholarships to aspiring dentists.

CPIL also runs a programme called 'Bright Smiles Bright Futures', which takes dentists to schools to

So far, it claims to have covered 33,000 schools and 15

teach children how to keep their teeth

wo

I lia

healthy.

rys

a million children from 112 towns across the country.

ual DISTRIBUTION

by

The philosophy of distribution is like this. A toothpaste is still not a high-involvement, purchase, and consumers can be easily swayed. Availability drives consumption especially in rural markets. Colgate ' s

• Physical distribution reach, the width and depth of it.

• Customer marketing approach.

• Modernization of sales operations and enhancement of sales efficiencies.

. to

Iral distribution strategy is a three-pillar one.

na

md

)Os

ign

'a's

11 a

:em

felt heavily in 'haats' and 'shandies' , as it finds these to be ideal

locations to carry out promotions. But

weren't well managed, it would be a logistical nightmare. Reaching out to every single village (width) and retail kiosk (depth) is a mind-boggling task. India has around 3 million retail outlets that ' Stock toothpaste ,

Colgate tries to make its presence

by and large, it's the regular system that must do the job.

If it

218 Cases in Rural Marketing

ranging from roadside kiosks to fancy supermarkets. Colgate supplies stock which are 'key account holders', supplying supermarket chains and the like.

Directly, Colgate sells products to about 850,000 outlets. The customer approach is one that treats everyone involved in distribution as a customer who must be kept satisfied. Each stockist, for example, is part of Colgate's incentive plan, such as the 'Colgate Dil Se' plan for wholesalers. Says Hegde, "A stockist should earn at least twice the return that he gets from a bank deposit, since he's investing in our business". Retail margins vary by product category.

its sales operations, Colgate is automating

feel of the market pulse. As it is, it runs on a

fairly well-oiled system, with speed to market (from factory to deepest rural retail outlet) being about two

weeks. Products move from factory to a central warehouse in each state, and then to the stockists , who in

it's easy to

track demand by watching their numbers. That's the basis for its forecasting, on a monthly basis. Once the entire system is automated, Hegde hopes, it could reduce to a weekly basis.

turn distribute the stuff to retail outlets by vans . Since stockists are Colgate's redistributors,

market data on a real-time basis. This would give it a better

In an effort to modernize

its stockists, to try and track

wars take on a different hue.

Here , it's a brawl for signage and shelf space, and Lever has the advantage of having a powerful portfolio

of other products , which gives it a greater hold on shopkeepers. For larger retail stores, CPIL acts as the

C olgate Shoppe program , which is a shop-with in-shop concept. The company rents out the shelf space to

display its products. For smaller retailers, POP material is made available.

However, in the

smaller Kirana stores (comer shops), the toothpaste

GROWTH AGENDA

LG Elec

products ,

Managin

Says the Managing Director , " With our strategy in place , and the organization completely aligned with that strateg y , w e ha v e created a more exciting environment at Colgate. We want to drive growth while

ual

n

the thro r

cont i nuously

looking at reducing costs, especially

in our supply chain .

We increasingly have a team

turnover

approach to our strategy " . The fact that all CPIL employees have to undergo an in-house dental check-up

 

Mr. :

t w i ce a week is testimony to how seriously it takes its job of keeping people's teeth in good order.

has been

Brand signage needs powerful product portfolio. In India, CPIL ' s product range is narrow. With its

televisior

R&D centre in Mumbai, CPIL boasts of product development (and speed of hitting the market) as a key

machine!

strength . It took the company only six weeks to respond to Aim with Cioaca Top. The main elements of its

gr

owth strategy are:

 

TARGET

 

"

The Ind

• Expand product offering-straddle varied segments, upgrade consumers.

• Improve effici encies-- enhance vendor management.

• Widen coverage-through rural, urban, new products and dental programmes.

• Partner dental profession-through grants, sponsorships and scholarships.

• Leverage technological leadership - faster speed to market through R&D .

• Empower and en e rgize human capital-build a s eamles s o rganiz a tio n .

• Stren g then brand building-renew advertising vigour .

QUESTIONS

I .

E x plain in detail

how Colgate regained its hold i n the toothpaste market? .

2.

Considering the growth agenda of Colgate, suggest appropriate measures to gain stronghold in rural markets.

Source A&Ms

high tech priced pn segment I cent in th Pradesh , segment .

of time a Head, A~ in the ne:

the follos

COMPE

Apart fro

heavywe