Presentation on the marketing

strategy and marketing mix of

ASIAN PAINTS
at
Raj laxmi paints
Presented by Swaraj Thahriani
Index
oCompany profile
oProblems and objectives
oMethodology
oAnalysis and findings
oConclusion
oRecommendations
oLearning outcomes

History
Profile of products
Marketing Mix
BCG & ANSOFF Matrix
Problem identification
Strategies & Recommendations
Overview
HISTORY
o In the 1940s it was largely multinational
Companies such as British paint &Jenson
&Nicholson that dominant the Indian paint
market
o In order to increase revenue ,AP
concentrated on the rural market ignored
by multinationals.
In 1942,Four Young Mumbaikars Champaklal
Choksey,Chimanlal Choksi,Suryakant Dani and Arvind
Vakil.
Started With a strategy Going to where Consumer is.

The R & D upgraded to International Quality in producing
Phenolic & resins on its Coating.
Driven by Customer Focus and Innovative Spirit.
Mass Appeal By Gattu
Won the Prestigious Economic times-Harvard Business
School twice
In 1954,APasked the famous cartoonist
R.K Laxman to create a mascot for the
company & from his pen was born
Gattu.
Brand Leadership
a)1942-1967 Evolution Phase

b)1967-1982 Extension and Consolidation Phase

c)1982-1986 The years of Excellence

d)1987-1997 Moving Closer to the Consumer

e)1997-1999 Changing rules of the game

f)1999- The new Asian Paints

The Evolution phase
Stiff competition from MNCs
Product innovations
Reaching rural
Seeding relationships
Quality Products
Ensuring service to network

All this leading to leadership status in 1967
Brand Leadership
a)1942-1967 Evolution Phase

b)1967-1982 Extension and Consolidation Phase

c)1982-1986 The years of Excellence

d)1987-1997 Moving Closer to the Consumer

e)1997-1999 Changing rules of the game

f)1999- The new Asian Paints

Extension and consolidation
Extension of the brand across borders.
International presence
Consolidation of gains/leadership status
Product Innovation in new categories
The core value getting strengthened by a
series of investment into systems to
ensure better product delivery

Brand Leadership
a)1942-1967 Evolution Phase

b)1967-1982 Extension and Consolidation Phase

c)1982-1986 The years of Excellence

d)1987-1997 Moving Closer to the Consumer

e)1997-1999 Changing rules of the game

f)1999- The new Asian Paints

The Excellence Years
Launch of New technology in terms of
tinting which gave a huge fillip to shade
selling
Product innovation
Connectivity with the sales set up
The Excellence Years
Despite leadership over a decade Asian Paints,
mindshare was perceived to be far lesser

It was the largest manufacturer of paints in Asia and
the sixth largest in the world. However, this was not
perceived by the consumer

Asian Paints also seen to be a company that made
paints such as distemper, ordinary enamel and
emulsion paints, for the masses.
The Excellence Years
In 1983, the first corporate communcation

Objectives
(i) establishing Asian Paints as the leader in the
paint category
(ii) presenting it as a manufacturer of premium
paints
(iii) establishing high salience for Asian Paints in
what was inherently a low interest category

The Excellence Years
Launched a campaign Spectrum Of
Excellence
a series of Press Advertisements talking of
excellence in AP products
The Excellence Years

The campaign increased saliency of the
AP Brand
In an otherwise quiet scenario, the
increase in saliency itself resulted in
higher intention to purchase


Brand Leadership
a)1942-1967 Evolution Phase

b)1967-1982 Extension and Consolidation Phase

c)1982-1986 The years of Excellence

d)1987-1997 Moving Closer to the Consumer

e)1997-1999 Changing rules of the game

f)1999- The new Asian Paints

Moving Closer
The excellence campaigns didnt increase
consumer feelings towards the brand
Consumer research showed
Paints are seen to rejuvenate and
brighten up a gloomy place, and give a
room a more spacious look. Painting
signifies festivity, life and plenitude
Moving Closer
Celebrate with Asian Paints - thus evolved.


It ventured to help people think of the joy that
follows painting rather than the tedium of the
process.

Moving Closer

It established Asian Paints as a paint for all
surfaces, a paint that delivers lasting beauty
through its durability and good quality

It also created advertising that related to
specific festive occasions in each part of the
country delivering regional empathy
Asian Paints associated with festive events across
the country

Moving Closer
By the end of this period,the brand Asian
Paints achieved very high salience as well as
a highly favourable disposition
Asian Paints also seen as a manufacturer of
premium paints.
Above , there was a warmth which people felt
for Asian Paints
Established Asian Paints top of mind with a huge
competitive edge.

Moving Closer
During this phase the process of product
innovation continued
Two launches one in rural and the other in
Exteriors gave a fillip to the overall image of
the brand
A series of brand building efforts were
undertaken in lower market share
geographies
A lot of excitement was created by investing
into communication for other brands


Brand Leadership
a)1942-1967 Evolution Phase

b)1967-1982 Extension and Consolidation Phase

c)1982-1986 The years of Excellence

d)1987-1997 Moving Closer to the Consumer

e)1997-1999 Changing rules of the game

f)1999- The new Asian Paints

1997-99 Changing rules of the
game
There was a revamp of various
Management processes through a re-
structuring exercise
This helped in bringing more focus to the
corporate brand and aided the process of
innovation in products and services
A series of initiatives launched bringing the
brand more closer to the user

1997-99 Changing rules of the
game
The initiatives included:
Launch of a Asian Paints Helpline,a service to fulfill the
information needs of any person planning to paint

Launch of retail shops offering a series of decision
making tools and shade options along with a
communication campaign to create the excitement

Investing in technology to improve supply chain
efficiencies and giving a platform to enter into some
CRM initiatives


Brand Leadership
a)1942-1967 Evolution Phase

b)1967-1982 Extension and Consolidation Phase

c)1982-1986 The years of Excellence

d)1987-1997 Moving Closer to the Consumer

e)1997-1999 Changing rules of the game

f)1999- The new Asian Paints

1999- The new AP
Threats
Aggression from existing players.
The external environment saw an entry of
a lot of multinationals trying to attack us on
various segments.

Market Shares of five major players
Company
o
10
20
30
40
Decorative
&
Industrial
AP GN BP ICI P
Sh
AP-Asian paint
GN-Goodlass Nerolac
BP-Berger Paint
ICI P-ICI Paint
SH-Shalimar
(Market Share %)
Decorative
Industrial

Market Shares of five major players
AP-Asian paint
GN-Goodlass Nerolac
BP-Berger Paint
ICI P-ICI Paint
SH-Shalimar
Overall
Company
10
20
30
40
AP GN BP ICI P SH
(M S %)
33
18
9 9
7
Asian Paint Sales Performance:
1998-2001
911
1033
1221
1373
1998 1999 2000 2001
Sales Value
(crore)
Brands
Apex
Tractor
Apcolite
Royale
TouchWood
Profile of products
Wall Paints
Apcolite Royale Emulsion, Tractor Washable ,Apex
Exterior, Apcolite Finishes(interior).
Metal Paints
Apcolite Synthetic Enamel paints,
Wood Finishes
Apcolite Wood Varnish, Wood Finishing (Matt &
Glossy), Touchwood Finishes
Automotive paints
Apca NC Automotive,Krilo Acrylic Paint

Promotion
APIL Emulsion brand Royale Competed with ICI Dulux
Velvet touch in Discounting the products(3-10 Rs per litre
on Emulsion Paints).
APIL offered 1151 Different Shades.
Advertising Budget Increased Annually.
Urban Customers-Light Colours
Rural Customers- Dark Colurs
Touch Screen Facilities in shops to see the Colour
Texture


Contd
Mascot Gattu
Indentified as Brand Icon of Asian Paints.
Uses IT systems in its operation to
improve inventory levels and Delivery
Schedule.
Shifting Advertising Theme
Mera Wala Concept to Mera Wala Rang to
MeraGhar Concept( According To Festive
Seasons)
Place-Plant & Facilities
It has 52 Sales offices and 14000 Distribution Channels.
Main Plant location
Bhandup, Maharastra
Ankleshwar,Gujarat
Patancheru,Andhra pradesh
Kasna,Uttar pradesh
Brand Equity makes APIL to increase Market Share by
1%.


APIL Ventures & Technology
APIL has Joint Ventures abroad in
FIJI,Tongo,Solomon Islands
Vanuata, Queensland in Australia
Technological Collaboration with Japan Nippon
Co Ltd.,
Asian Paints Research & Development Has
acquired the Reputation of being Finest in South
Asia.
Market Share: Decorative paints
34%
19%
13%
12%
6%
5%
8%
3%
Asian Paints
Nerolac
Berger
ICI
J&K
Shalimar
Others
Rajdoot
Market Share: APIL
Market Share: Industrial Paints
16%
40%
14%
9%
8%
8%
5%
Asian Paints
Nerolac
Berger
ICI
J&K
Shalimar
Others
Market Share: APIL
BCG
Cash Cows
Wall Paints (Interior & Exterior Paints)
Decorative paints
Stars
Metal/Industrial paints
Wood Finishes(Varnish , Polish)
Question Marks
APIL products launched in Abroad thro Joint
Ventures in Fiji ,Nepal , Solomon Islands, Australia.
Dogs
Marine Paints,Automotive paints and others( Black
board paints)





Existing Products New Products
Existing
Markets


Market Penetration





Product Development



New
Markets


Market Development





Diversification





ANSOFF Matrix
Ansoff Matrix
Market Penetration
Wood Finishes & Metal paints
Product Development
Wall paints( New Washable & acrylic Emulsion paints
E.g. Tractor & Emulsion acrylic paints)
Diversification
Marine Paints(Heavy Duty) ,Automotive paints( TVS
Collaboration)
Market Development
Venturing APIL Products abroad
Market Segmentation
Divided into two segments
Decorative paints-70 % of total paint
market
Industrial paints
Synthetic enamels -47 % share
34 % of market share
Interior paints and exterior paints
Automotive paints- 50 %
APIL Problems
Less exports in 1998-99 due to absence of third party exports.
65% of Cost of Production is accounted for the Raw Materials.
40-60% of the raw materials are imported.
Due to Imports APIL Faced with more Customs Duties
Excise Duties On Coating increased
Excise Duty was levied on MRP rather than on Manufacturing Cost.
Main Raw Materials
Pthalic Anhydride, Resins
Titanium Dioxide,glycerine
Due to increasing Duties the Prices of Products had to increase.
Decline in Sales Volume during Monsoon seasons


Solutions & Recommendations
Vendor Development
Promote Vendors in supplying the raw Materials Rather
than Importing.
Develop suppliers in supplying basic ingredients for
paints(pthalic anhydride, Resins)
During Monsoon Seasons
Increase Exports to More countries (Already Captured exporting
to 22 markets-Asia Pacific,Middle East,Africa)
Pricing Strategy-Due to more Excise duties
Penetration pricing
Destroyer pricing
Target Pricing


Contd
Here in reworking Pricing strategy
Offer Seasonal Products E.g. Diwali in North,Pongal
in south & Christmas.
Increase promotional activities with regard to
Regional festivals.
Achieve the target using the target pricing during
seasonal products.
Offer other variety of products ( Wood Polishes)
at a discounted rate during sale of Decorative
paints-predator pricing
Contd.,
Industrial paints
tie up with Business units for longer periods.
Take over of small companies
In India there are 25 organized companies and 2000
unorganized companies.
Take over of Small companies to increase their
market Share.
Refinishing old Capital equipments/metals with paints
for industries @ low rates to prevent Corrosion.
Automotive paints
Increase tie up with Automotives (Already with TVS)
Contd.,
Increase the Per Capita
Consumption in kgs( for
india it is 0.3 kgs)
Increase Production
during Festive seasons
Per capita consumption of paint in kgs
23%
19%
17%
15%
13%
13%
0%
US
Germany
Sweden
France
UK
Japan
India
RURAL MARKETING
Only paid company with an organised rural
network(higher product visibility)
First one to introduce SMALL PACK sizes
for a wide variety of paints.
Choice of Darker Shades like green and
red suiting the rural markets.


LATEST SCENARIO
SALES BREAK UP
The 5 Themes for Colour Next 09

Indigene: - Consisting of earthy tone and
shades, they represent the colours that best
describe India.
Consisting of earthy tone and shades, they
represent the colours that best describe India.
Earth Song:- It resonates softer colours that
have a soothing effect, think environmental
friendliness.
It resonates softer colours that have a soothing
effect, think environmental friendliness.
Multiplicity: - A melting pot of colours. It makes way for
contrasting shades, subdued tones and everything in
between.
A melting pot of colours. It makes way for contrasting
shades, subdued tones and everything in between.
Homepage: - Colours that dominate the virtual world and
cyber space. Of the digital era, the theme is inspired by
the Gen - Y.
Colours that dominate the virtual world and cyber space. Of
the digital era, the theme is inspired by the Gen - Y.
Metropolis: - These are dominating colours that speak
the bold language of the urban individual.
These are dominating colours that speak the bold language
of the urban individual.

Results for the FY ended March
09
Demand conditions for decorative business
improved in the fourth quarter. Our objective will
be to secure growth through a host of retailing and
customer centric initiatives. The industrial coatings
business (including automotive paints) was
impacted by the general demand slowdown. Our
international operations performed well on the
back of good growth in Middle East and South
Asia regions. said PM Murty, Managing Director &
CEO, Asian Paints Limited.


PAINTS
The unorganised sector controls around
35% of the paint market, with the
organised sector accounting for the
balance.
Top organised players include Asian
Paints (30% market share), Kansai
Nerolac (20% market share), Berger
Paints (19% market share) and ICI (12%
market share).
PORTERs MODEL
Supply : Supply exceeds demand in both the decorative as
well as the industrial paints segments. Industry is fragmented.


Demand : Demand for decorative paints depends on the
housing sector and good monsoons. Industrial paint demand
is linked to user industries like auto, engineering and
consumer durables.


Barriers to entry: Brand, distribution network, working
capital efficiency and technology play a crucial role.


Bargaining power of suppliers : Price increase constrained
with the presence of the unorganised sector for the decorative
segment. Sophisticated buyers of industrial paints also limit
the bargaining power of suppliers. It is therefore that margins
are better in the decorative segment.


Bargaining power of customers : High due to availability of
wide choice.


Competition : In both categories, companies in the organised
sector focus on brand building. Higher prices through product
differentiation are also followed as a competitive strategy.


THANK YOU