FORE School of Management

SUPER SHAMPOO CASE Consumer Behavior I

AND THE INDIAN MASS
MARKET
Group Case Analysis Report

Group 1
Arjun P K (231033)

Rohit P L (231122)

Srijit Nair (231158)

Vivek Chavan
(231173)

Snehashish (231174)

John S Manavalan
(231178)
Contents
Executive Summary.................................................................................................... 2

Problem Statement..................................................................................................... 3

Data Analysis.............................................................................................................. 3

Recommendations.................................................................................................... 12

Key Decision Criteria................................................................................................ 13

Action and Implementation Plan...............................................................................15

Conclusion................................................................................................................ 16

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Executive Summary

The case gives a situation where Mr. Suresh Venkataraman desires to launch
his own shampoo brand in the rural markets of Karnataka. The fact that
fascinated him the most was the use of single packaging. Also he wondered
how with the invention of sachets, shampoo as a category was transformed
from an unaffordable product to an affordable one. Therefore, in spite of
being from Coimbatore, a city known for its textile industries, he decided to
get into the shampoo industry. Mr. Venkataraman also had a firm belief that
the rural market offered a huge potential for consumer products and before
he goes ahead with the launch, he carries out a survey to figure out how the
rural markets respond to consumer products and how this can be used for a
successful launch. He figures out that he can have two options- to come out
with both sachets and bottles of the shampoo or to only come up with the
sachets and then if it’s accepted, he can come out later with bottles. Mr.
Venkataraman decided to commission a survey to obtain some insights
related to the consumer behaviour towards shampoo category as well as
towards the brands.

Mr. Venkataraman often wondered why several brands of shampoos did not
have a brand name that was simple to understand. He decided to name the
product Super Shampoo. He selected the name Super as it was easy to
pronounce and had an English overtone that was considered a part of the
aspirations of rural consumers. Moreover, the word “super” was amplified by
the media to celebrate film stars by projecting them as “superstars”. The
word “super” triggered a superior image amongst whatever it was competing
against in a specific context.

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Problem Statement

Super shampoo being a new brand, had to face challenges like:

o Addressing the established competitors like HUL,P&G,cavin care.

o Competing against the advertising methods of the established

brands.

o Understanding the diversity of cultures in the rural market.

o Understanding the consumer psyche in the changing

environment.

o Low per capita income.

Data Analysis

Rural market in India

In India roughly 150 million households earned between Rs. 75,000 to Rs.
150,000, and it has been found out that 25% of these 150 million were from
urban and rest 75% from rural India. Rural consumer market consisted of
between 720 & 790 million consumers with around 160 million households.
The FMCG market in India was estimated between US$15 billion to US$18
billion and likely to grow to US$33 billion by 2015. The rural market grew
25% in 2008 and was projected to be around US$ 425 million in 2010; double
the size of 2007. It was also estimated that around The rural market grew
25% in 2008 and was projected to be around US$ 425 million in 2010; double
the size of 2007.

The FMCG market in India was estimated between US$15 billion to US$18
billion and likely to grow to US$33 billion by 2015. It was found that the rural
market grew 25% in 2008 and was projected to be around US$ 425 million in

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2010; double the size of 2007. US$ 8.55 million of FMCG was contributed by
rural India. The US$ 8.55 million of FMCG was contributed by rural India.
Urban markets were contributing only 29% of all of FMCG. There are around
350 million low income consumers in the country.

The Rural Consumer

The rural consumer base was a highly heterogeneous one in nature. The
education level is low compared with the developed cities and they are
highly risk averse in nature. The consumers are found to be highly value
conscious. They do not mind shelling out extra money if the [product is worth
it.

Shampoo market in India

Total Hair Care market worth was estimated to be of Rs. 70 million in value.
Out of which Shampoo category was around Rs. 30 million. The awareness of
shampoo was around 80% in rural and 90% in the urban areas. The Per
annum consumption was 13 ml per capita, much lower than Asian average.
The top players with there market shares are as follows

 HUL – 46%,
 P&G -24%,
 Cavin Kare- 18%,
 Dabur -7%

The primary stock keeping units were bottles and sachets. Pricing of the
sachets were ranging from 50p to Rs. 3. 90% of sachet market was from
rural, out of which 70% of which came from South India. North India
contributed 50% of bottle volume which shows that in south Indian rural
markets sachets is the best way of launching the shampoo.

The parameters of the top brands are as follows:

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Parameter
Clinic Plus Head & Shoulders Chik
s

Low income Low income

consumer High income consumer
Target
consumer with high
Consumer
awareness
(urban &
(urban & rural)
rural)

25 ml – 300 100 ml – 400 ml 25 ml – 300 ml

ml bottles bottles bottles
SKU

7.5 ml
7.5 ml sachets 7.5 ml sachets
sachets

Pricing Rs. 2 sachet Rs. 3 sachet 50p – Re. 1 sachet

Cosmetic
Benefit Anti dandruff Cosmetic value
value

Flagship brand for

Family value Leading anti dandruff
Value confident Indian
& Health shampoo
woman

Category Beliefs among non-users

In the Indian mass business sector, it was found that among non-clients of
cleanser, most don't participate in washing their hair all the time, with the
larger part of respondents washing their hair just once (48%) or twice (43%)
every week. In those examples, most persons showed that they didn't utilize

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Shampoo to wash their hair, but instead option items, for example, Shikakai
or cleanser; just 24% of the respondents utilized cleanser.

Statements Mean
Value

1. Washing with shampoo makes hair look beautiful 4.1

2. Always buy shampoo in Sachet 4.1

3. Use shampoo only when need to wash oil from hairs 4.0

4. Shampoo makes hair strong and healthy 4.0

5.Shampoo cleans hairs better than soap 3.9

6. Feels confident when use shampoo 3.9

7. Shampoo is very expensive 2.5

8. Shampoo is a luxury that is used on special occasions 2.6

Agree

 There is adequate confirmation to infer that non-clients of cleanser

trust that utilizing cleanser will make their hair solid and solid
 It is likewise trusted that cleanser ought to just be utilized every so
often to wash oil from the hair as it cleans the hair superior to anything
cleanser

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  Appearance is likewise a key element for the Indian shopper as it is
trusted that there is a help in certainty at whatever point the hair has
been washed with cleanser rather than utilizing any of the option items
 In spite of these convictions, the Indian mass-business sector shows a
general unwillingness to buy a lot of this item at any one time and
have just acquired cleanser sachets.

Disagree

 The buy examples are not straightforwardly identified with the to some
degree unfavorable financial states of the Indian mass-market, as the
cost for cleanser does not impact its buy or recurrence of utilization.
 It is not trusted that cleanser is extravagant nor that cleanser is an
extravagance thing, just to be utilized on extraordinary events.

Neither Agree nor disagree:

 Chemicals in cleanser are bad for the hair and will harm it
 Cleanser can be utilized for the periodic wash however not for the day
by day wash
 Attempt cleanser in light of the proposal of a companion of relative

Cognitive beliefs on the three brands of shampoos

Clinic Plus
• A cosmetic brand targeted to low income users thus ideal for the
consumers in rural India who were predominantly of the lesser income
levels

• Positioned as a "Family Value and Health Foundation" which helps to

solve the largest hair problem in India i.e. hair fall while providing
lustre, shine and strength

Advertising elements that match with the cognitive beliefs:

• Prevention of split ends and protection from dirt

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 • Prevention of hair fall

Reasons for a score of 3.9 on question about probability of next

time purchase:

• The Clinic Plus advertisements have an aspirational appeal particularly

to Indians in the rural areas who strive to achieve their social needs of
self-actualization, achievement and affiliation

• It shows the mother as the chief decision maker when purchasing for
the family; other women can relate to this as most rural Indian women
would be in similar positions based on the culture and societal norms

• Focus on Family’s hair care rather than showcasing individual hair care
benefits

Head & Shoulders

• Head & Shoulders is an anti-dandruff brand of shampoo approved by
dermatologists and endorsed by celebrities

• The brand is a part of the fastest growing segment (anti-dandruff) of

the market and is priced in the premium tier

Advertising elements that match with the cognitive beliefs:

• The corresponding advertisements provide assurance through science;

uses high percentage to support the claim of reduced hair fall and
believability due to 9/10 dermatologists recommending the brand

• Value for money : The claim of one versus three washes which
appeals to the conservative and cautious nature of Indian rural
consumers and helps to reduce dissonance related to purchasing this
premium product

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 • The product includes intensive Solutions, such as VitaZinc designed to
treat itching, flaking, dryness, irritation and redness, it also helps
protect hair from falling out

Reasons for a low score of 2.7 on question about probability of next

time purchase:

• Do not motivate rural Indians to purchase because of following

reasons:

• the price of the brand

• Difficulty in rationalizing the purchase because the product they

have been using for years (Shikakai) provides the same benefit

• Besides solving their dandruff problem and being more appealing

to the opposite sex, the ads do not pull on any of the aspiration
based appeals which are extremely important especially in the
rural Indian culture

Chik
• Chik is a cosmetic shampoo, which is the 2nd most recognizable and
used brand of shampoo which is priced so as to target to semi-urban
and rural consumers

• It would be present in the popular or economy tier

• Chik promises the confident Indian woman soft, nourished beautiful

hair

Advertising elements that match with the cognitive beliefs:

• Chik keeps hair soft, nourished and beautiful all the time

• Do not have to worry about tangling of hair

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Reasons for a neutral score of 3 on question about ‘probability of
next time purchase’:

• Fail to tap into the core beliefs of the decision maker i.e. strong family
bonds, earning societal respect, need for affiliation, goal achievement
through hard work

• The ad is weak, does not have a strong aspiration base, and failed to
address the key problem of hair fall

• The risk averse nature of rural Indians who may not see the need for
simply looking beautiful as enough motivation to purchase

Affective aspects reflected by advertisements of the three

brands of shampoos

Clinic Plus
In the Clinic Plus advertisements we can see the influencer is the mother. The
mothers are nurturing and providing what is best for their children; therefore they
would select the best shampoo for nurturing their children’s hair as well. Clinic Plus
promises to help them to do that. It instils confidence in the mothers who may give
themselves credit for giving their daughters the freedom to experiment with her
hair, without having to worry about their daughters’ hair fall

Head and Shoulders

The endorsements may lead consumers to externalize the benefits experienced
from using H&S through sharing experiences with friends giving all the distinctive
praises to the shampoo. The H&S influencers such as Kareena Kapoor and Saif Ali
Khan makes consumer believe that after using the shampoo they would look like
them (stylish and centre of attraction)

Chik

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Chik has used beautiful young urban women who are independent and ready to
conquer the world. This depicts the minds of the modern Indian women and that is
how the target market can relate with it. Chic leads consumers to discover a new
and beautiful side to them and along with it, the confirmation that no goal is too far
or unachievable.

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Differences between the cognitive and affective beliefs
reflected by the respondents based on their exposure to
the advertisements of the three brands
• In the case of cognitive belief, customers have different perception
based on the recognition from the advertisement. It might be negative
or positive.

• In the case of affective belief, using celebrities for trust or story plot in
the advertisements, the brands try to attract customers to have
positive affective belief.

Recommendations

To succeed in rural market the company will need to adapt the 4P’s of
marketing to the 4A’s in their strategy – Awareness, Acceptability, Availability
and Affordability. Due to the limited reach of mass media the marketer would
have to focus more on traditional media like melas, haats or mandis, which
were places where the entire population of a village congregated on a
periodic basis to purchase a multitude of essential goods while also seeking
a say’s entertainment for the family.

Access and availability are equally important. There should be deep

distribution and easy availability. Availability is the biggest challenge.
Affordability is the key driver in rural India because of which the sachets

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needs to be carefully priced. With low disposable income product needs to be
affordable to the customer.

As seen above there are several challenges for the product can face in the
rural market hence they can use try devising some strategy to overcome the
challenges. Some of the strategies that the company can adopt are:

Product Strategy: The packaging of the product should be in colourful and

decent sachets in order to attract the rural consumers. The rural consumers
are more concerned with the utility of the products. The brand awareness
and loyalty in rural areas is quite high. Therefore, first a brand value must be
created among the rural customers.

Distribution Channels: Most manufacturers and marketers do follow a

distribution arrangement for a village with the population of at least 5000
people. While it is essential to formulate specific strategies for distribution in
rural areas, the characteristics of product, its shelf life and other factors have
to be kept in mind. The distribution strategy especially framed for rural India
are:

 Co-operatives society Public distribution system Multipurpose

distribution canters
 Distribution up to feeder markets/mandi towns/hats etc.

Pricing Strategy: The per capita income of consumers in rural areas is

quite low as compared to urban areas. Therefore, the price of the product in
rural market should be lower than that of urban market. Also refill packs can
be introduced as they reduce the price. Promotion Strategy: In rural markets,
TV, radio, print media and cinema are not that popular. Therefore, new and
innovative modes of promotion strategies should be adopted. One strategy
could be promoting the product at village haats, melas and mandis. Also,
leaflets, in local languages, describing the product could be distributed
among the villagers.

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Key Decision Criteria

Since Super cleanser is another brand, along these lines it could confront
very much a couple challenges before it positions itself easily in the country
market. A percentage of the significant issues and choice focuses that could
manifest are as per the following:

•Addressing the built up brands of shampoos:

There were essentially three noteworthy brands of shampoos in country

South India. They were Clinic Plus, Head & Shoulders and Chik. These brands
were truly settled in their own particular rights and it would be very
troublesome for new participant to dislodge these brands from the business
sector.

•Competing against the promoting lightning war of the built up brands:

The aforementioned brands of shampoos are the results of vast business

houses like HLL, P&G and Cavin Kare individually. In this way, they have an
immense budgetary reinforcement to spent on promoting which is
perpetually the most mainstream technique for advertising a FMCG item.
Despite what might be expected, another contestant like Super Shampoo
does not have the obliged monetary ability to spent on promoting.

•Understanding the differences of societies:

There is a gigantic distinction between the urban and country outlook. There
exists an enormous crevice between shopper conduct in country ranges and
urban regions. Since, Mr. Venkataram is from a urban territory and his psyche
thinks in a urban style, there can be trouble in identifying with the country
purchaser.

•Understanding the purchaser mind in the evolving environment:

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Interest for an item is fluctuated for individuals living in diverse zones with
distinctive climatic conditions, occupations, education level, standpoint
towards life and their presentation to cutting edge products and
administrations. The salary distinction between the couple of well off
individuals and poor make contrasts in the interest, traditions and
convictions, making division troublesome.

•Low per capita pay:

Provincial customers have low per capita pay, low obtaining force and a low
proficiency rate, adding to a low expectation for everyday comforts. In any
case, this is changing as purchasers are turning out to be gradually
proficient.

•Sales Management:

Provincial advertising includes a more noteworthy measure of individual

offering exertion contrasted with urban promoting. The provincial sales
representative must have the capacity to direct the country buyers in the
decision of items, who now and then don't appropriately spur clients.
Channel administration represents an issue as circulation systems in country
towns are protracted, including more go-betweens and therefore higher
shopper process. Additionally, merchants with experience are not accessible.

•Proper media channel:

Not at all like urban India, country India was what one may call a
fundamentally dull media market as far as the most entered urban media; for
instance, TV was the media with the most noteworthy scope, yet it infiltrated
just 38% of rustic India. Radio was in front of print as far as scope, likely
inferable from proficiency boundaries. It came to 18% while print came to
15%. Film had a simple 5% scope. In this way, it was critical to pick the right
media for promoting in

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Action and Implementation Plan

Product Strategy:

The packaging of the product should be in colourful and decent sachets in

order to attract the rural consumers. The rural consumers are more
concerned with the utility of the products. The brand awareness and loyalty
in rural areas is quite high. Therefore, first a brand value must be created
among the rural customers.

Distribution Channels:

Most manufacturers and marketers do follow a distribution arrangement for

a village with the population of atleast 5000 people. While it is essential to
formulate specific strategies for distribution in rural areas, the
characteristics of product, its shelf life and other factors have to be kept in
mind. the distribution strategy especially framed for rural India are-

 Co-operatives society

 Public distribution system

 Multipurpose distribution canters

 Distribution up to feeder markets/mandi towns/hats etc.

Pricing Strategy:

The per capita income of consumers in rural areas is quite low as compared
to urban areas. Therefore, the price of the product in rural market should be

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lower than that of urban market. Also refill packs can be introduced as they
reduce the price.

Promotion Strategy:

In rural markets, TV, radio, print media and cinema are not that popular.
Therefore, new and innovative modes of promotion strategies should be
adopted. One strategy could be promoting the product at village haats,
melas and mandis. Also, leaflets, in local languages, describing the product
could be distributed among the villagers.

Conclusion

It is quite evident from the case that a proper market survey is required for a
new FMCG product in general and a new shampoo product in particular to
enter into the rural market. There were days when huge organizations
flocked to rural markets to establish their brands. Today, rural markets are
critical for every marketer be it for a branded soap or an automobile. As
urban markets are getting saturated for consumer goods (FMCG & Durables),
marketing executives are fanning out and discovering the strengths of large
rural markets. The Indian hair care market is undergoing a sea change in the
respects of the buying behaviour and consumer preferences. The consumers
are willing to experiment with new products and manufacturers can therefore
take advantage of this situation and gradually venture into the market. There
is a strong wave in favour of anti-dandruff shampoos and shampoos with
minerals and proteins which nurture the health of the hair. There is a stiff
competition and the rural market can be exploited for revenue. The income
pattern of the population in rural areas is a bit wayward and the
manufacturer can tap this situation and make profit by use of “Sachets”.
According to the analysed data, the major dilemma for companies today is
the gap between the rural and the urban consumer. The reason why only few
companies have managed to venture out is because of the lack of

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understanding into the psyche of the rural consumer. Thus looking at the
challenges and the opportunities which rural markets offer to the marketers,
it can be said that the future is very promising for those who can understand
the dynamics of rural markets and exploit them to their best advantage. A
radical change in attitudes of marketers towards the vibrant and burgeoning
rural markets is called for, so they can successfully impress on the 230
million rural consumers spread over approximately six hundred thousand
villages in rural India. it is expected to increase because of the potential
recognized in the rural market by the major players in this segment. The
market is also expected to increase due to lower duties and aggressive
marketing by players. Shampoo is also available in a sachet, which is
affordable and makes up to 40% of the total shampoo sale. Since long HUL
has been the market leader in the shampoo industry. With rivals like Procter
& Gamble and Dabur giving tough competition, FMCG major Hindustan
Unilever’s market share in shampoo segment is declining and analysts
pointed out that there is a concern over the firm losing out to competition in
its other core segments. According to the Nielsen’s January-February data,
HUL’s market share (volumes) in shampoo segment declined by 1.3
percentage points to 47.3 per cent while P&G gained by 2.4 percentage
points with a market share of 17.7 per cent. Dabur on the other hand gained
0.8 percentage points capturing 6.7 per cent market share in the estimated
Rs. 3,000 crore Indian shampoo market. The company’s brands ‘Clinic Plus’,
‘Dove’ and ‘Pantene’ competes against the likes of P&G’s ‘Head & Shoulder’
and Dabur’s ‘Vatika’, ITC’s ‘Fiama Di Wills’ The Indian shampoo market is
characterised by a twin-benefit platform: cosmetic and anti-dandruff. It is
basically an upper middle class product, as more than 50% of the consumers
use ordinary toilet soap for washing hair. While the awareness level is high,
the penetration level is very low even in the metros which is only 30%. Urban
markets account for 80% of the total shampoo market, the penetration level
is rapidly increasing due to decline in excise duty, which was 120% in 1993
to 30% currently. The hair conditioner market is estimated at around Rs 200

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crores and is growing at about 40 to 50 percent a year. In India, the share of
hair conditioners is merely one-fifteenth of the shampoo market. In most
mature markets, the share of hair conditioners is about one-third.

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