8/2/2019 lux. 07 final

1/39

PART 1

PART 1

A Case Study On 4 P's Of Lux

PROMOTION

Promotion is an important marketing force that provides an extra incentive(usually short term innature) for consumers, the trade, the sales force and other influential groups. Promotion rankswith advertising and selling efforts as one of the major activities that can be utilized in themarketing of packaged goods. Promotion is directed not only to consumers or the trade but alsoto the occasion to the sales force and other influential groups.

The great Indian brand wagon of Lux started nearly 4 decades ago. Great brands sometimesoutlast their ambassadors as proven by Lux which celebrated its 75th anniversary in India.

The first ambassador Leela Chitnis featured in a Lux advertisement which flagged off the Luxwagon. She gave way to a galaxy of stars which include Madhubala, Nargis, Meena Kumari,Mala Sinha, Sharmila Tagore, Waheeda Rehman, Sairah Banu, Hema Malini, Zeenat Aman, JuhiChawla, Madhuri Dixit, Sridevi, Aishwaria Rai Bachchan, Kareena Kapoor, Priyanka Chopraand most recently Katrina Kaif.

The last frontier for most actors aspiring to stardom is becoming a Lux ambassador. The brandhas outlasted many soaps. From the beginning, Lux became a household name in the country.

Lux advertisements through ages

Lux campaigns have wooed millions of people over the decades. Popularly known as the beautysoap of film stars, Lux has been an intimate partner of the brightest stars on the silver screen fordecades. An ode to their beauty, an announcer of their stardom, advertising campaigns on Luxhave featured film stars across the nation, promising their beauty and complexion to commonwomen

With top movie stars- from Madhubala to Madhuri, form Babita to Karishma and Kareenahaving endorsed the goodness of Lux over generations, it was natural that the brand has builtequity as the best beauty soap in India. In 2005 Lux celebrated its 75th anniversary sparking of acontroversy. Deviating its tradition of roping Bollywood Divas, this time none other than Shah

Rukh Khan endorsed Lux. The ads created instant controversy with marketers discussingwhether the brand has suddenly become MALE. Paul Newman also has endorsed Lux soapwhich shows that Lux makes such stunts to excite the market. Whatever be the controversy, thebrand again succeeded in creating excitement in the market. Some argue that HLL was testing anew positioning appeal to male users while others say that it was a one time endorsement tobreak the clutter.

8/2/2019 lux. 07 final

2/39

PART 1

A recent ad of Lux featured the golden couple Aishwarya Rai Bachchan and AbhishekBachchan. They were paid Rs.25 crore for this ad. But in all these advertisements the celebritynever shadowed thebrand.

From the beginning Lux, by using a leading film star of the time has fulfilled the consumers

aspirations of using beauty soaps via the rationale if its good enough for a film star, its goodfor me. This later moved into a transformation role of having a bath with Lux, which transportsthe user into a fantasy world of icons, film stars and fairy lands.

Change in communication strategy

Lux was always changing with the times. Whether in terms of product or in terms of promotions,the brand kept the consumers excited. Lux was initially a premium brand. It was being projectedas an aspirational brand and the endorsements by stars further reinforced the positioning.However the communication was slowly seemed to be losing relevance, as consumers werebeginning to question if the film star actually used the brand. The increasing competition in the

soap category also forced Lux to rethink on its targeting strategy. Several competitive beautysoap brands had begun advertising using similar methods of communication. The brand had achoice either to compromise on market share or dilute the positioning. In this context, the globalbrand team for Lux developed a new communication strategy. This strategy-bring out the star inyou-for the first time moves the brand away from the long running film star route. The film starsstill features in the new communication but not as her gorgeous self but rather as an alterego/projection of the protagonist, for a few seconds of the entire ad. Thus, for the first time thefilm star was used as a communication device and not as the main feature of the ad. The moveaway from the film star and her fantasy world to the regular Lux user with the focus on theprotagonists star quality is a change from the norms set by the Lux advertising in the past. With

the new communication strategy, the film star is used purely as a communication device to

portray star quality in every Lux user. This can be significantly seen in the latest TV commercialof Lux Crystal Shine where Priyanka Chopra is portrayed as a normal woman.

This idea-bring out the star in you-puts the consumer at the heart of brands promise. Thepromise goes beyond the functional deliverables of soap, beyond bathing and bathroom to theworld outside. Its the world where Lux on her side, an ordinary woman can impact her world

with her own star quality.

This is a successful attempt to bring the brand closer to its users and give it a more useful andcontemporary image. Breaking away from tradition, HLL resorts to a male and metro sexualShah Rukh Khan to revive Lux which turned 75 in 2005.

Sales promotion

Sales promotion, a key ingredient in marketing campaigns, consist of a collection of incentivetools, mostly short term, designed to stimulate quicker or greater purchase of particular productsor services by consumers or the trade.

8/2/2019 lux. 07 final

3/39

PART 1

Whereas advertising offers a reason to buy, sales promotion offers an incentive to buy. Salespromotion includes tools for Prominent Sales Promotion Schemes used by lux

Lux presented 30 gram gold each to the first 3 winners of the Lux gold star offer from Delhi.

According to the promotional offer that Lux unveiled in October 2000, a consumer finding a 22

carat gold coin in his or her soap bar got an opportunity to win an additional 30 gram gold. Thefirst 10 callers every week got a 30 gram gold each. The offer could be availed only on 100 gramand 150 gram packs of Lux soap.

Lux Star Bano, Aish Karo Contest:

All one needed to do was buy a special promotional pack of Lux soap. The pack comes with aspecial scratch card. The 50 lucky winners and their spouses were flown down to Mumbai to livea day like Aishwarya Rai would. They could also be given gift vouchers worth Rs. 50,000 fromShoppers Stop along with an exclusively designed Neeta Lulla saree and a beauty makeover byMichelle Tung, Aishwaryas preferred designer and stylist.

Lux celebrated 70 years of stardom with the Har Star, Lucky Star activity.

All wrappers of Lux had a star printed inside them. If the consumer found written inside the starany number from 1 to 5, he or she would get an equivalent discount(in Rs) on her purchase fromher shop keeper.

Public Relations

Not only must the company relates constructively to the customers, suppliers and dealers it mustalso relate to a large number of interest to publics. Public is any group that has an actual or

potential interest in or impact on a companys ability to achieve its objectives.PR involves avariety of programs designed to promote or protect a companys image or its individual products.

Lux PR activities

Press relations: Lux has been maintaining constant communicating with its potential customers

about various developments taking place in the brand by using press relations.

Events: Lux celebrated 75 years of existence in a grand way by unveiling Shah Rukh Khan as

their latest brand ambassador.

Kareena Kapoor, Juhi Chawla, Sridevi and Hema Malini graced the event and made it special.All this stars have endorsed Lux in the past. The event was held at the Grand Intercontinental inMumbai.

Limited edition: Coming up with limited edition of brand is also a way of attracting attention

towards the brand. It creates a buzz and feeling of urgency to try out the product and helps inpromotion of the brand. This strategy was also implemented by Lux by bringing out limitededitions like Chocolate Seduction, Aromatic Glow, Festive Glow and Hot Pink.

8/2/2019 lux. 07 final

4/39

PART 1

PART 2

Lux is a super brand that celebrated beauty across the world since 1925. The soap which was endorsed

by the beautiful film stars came to India in 1929. Lux has been the largest selling personal wash brand in

the country.

Lux has effectively managed its PLC through careful brand building and changing the pro

duct in line with the changing consumer. The brand is being positioned

as the favorite soap of Film stars has been consistent interms of communication and positioning. The

brand is also the classic example of successful celebrity endorsement. The first celebrity to endorse the

brand was Leela Chitnis . From Leela to Aishwarya , From Madhuri to Madhubala, Lux has been

endorsed by more than 50 film stars ( a sort of record isn't it). But in all these communications, the

celebrity never shadowed the brand.

Lux was always changing with the times. Whether it be interms of the product or interms of promotions,

the brand kept the consumers excited. Lux has two basic extensions interms of segments. Lux beauty

soap and International Lux.

Lux was in itially a premium brand. Lux was being projected as anaspirational brand and the endorsements by stars further reinforced the positioning. The increasing

competition in the soap category forced Lux to rethink on its targeting strategy. The brand had a choice

either to compromise on market share and uphold the premium positioning or to retain the market

share and dilute the positioning. Lux wanted to ensure that the brand be positioned as premium but

also did not wanted to compromise on the share. Thus born International Lux which is the premium

variant and the affordable segment was catered by Lux beauty soap.

http://3.bp.blogspot.com/_1pKvii0Z9Cs/Ra3lHkylaCI/AAAAAAAAAOc/fkIS4TOyjbM/s1600-h/lux+++aiswarya.jpghttp://4.bp.blogspot.com/_1pKvii0Z9Cs/Ra3k70ylaBI/AAAAAAAAAOU/cjpvdtdRNiA/s1600-h/lux-soaps.jpghttp://3.bp.blogspot.com/_1pKvii0Z9Cs/Ra3lHkylaCI/AAAAAAAAAOc/fkIS4TOyjbM/s1600-h/lux+++aiswarya.jpghttp://4.bp.blogspot.com/_1pKvii0Z9Cs/Ra3k70ylaBI/AAAAAAAAAOU/cjpvdtdRNiA/s1600-h/lux-soaps.jpg

8/2/2019 lux. 07 final

5/39

PART 1

Lux beauty soap is available in Four variants : Exotic Flower Petals,Fruit Extracts,Almond and Sandal. Lux

has a common ingredient of Milk cream in all the variants.

Although the brand enjoyed success and has sustained its leadership position, of late this brand has

been facing issues of stagnation. The stagnation is caused by the plethora of brands competing for the

market share and the scope for differentiation has reduced to almost nil. Together with the rush for

celebrities to endorse anything from salt to cars, Lux is finding it difficult to sustain growth in this

cluttered market.

In 2005 Lux celebrated its 75th anniversary sparking of a controversy. Deviating its tradition of roping in

Bollywood Divas , this time none other than Shah Rukh Khan endorsed Lux. The ads created instant

controversy with marketers discussing whether the brand has suddenly become MALE.Paul Newman

also has endorsed Lux soap which shows that Lux makes such stunts to excite the market. Whatever be

the controversy, the brand again succeeded in creating excit ement in the market.

Some argue that HLL was testing a new positioning to appeal to male users while others say that it was a

one time endorsement to break the clutter. For marking the 75th year Lux came out with a celebration

range endorsed by Kareena Kapoor . The Celebration range too created news because of its variant

:Chocolate Seduction. These innovative products created lot of excitement that ensured that Lux

remained in the top of mind of the consumers. Another variant which I like personally is the Lux with

Orchid which looked cool in terms of packaging and looks.

Over these years, the positioning of Lux also evolved. Earlier the brand used the positioning " Beauty

soap of Film stars" . But as the customer evolved, the positioning lost its charm because customersbegan to doubt whether the film stars actually used this brand. Taking a cue from the customers, Lux

changed the positioning appealing to the need for becoming a star. The new positioning is

communicated with the tagline " Bring out the star in you".Although worldwide the brand is being

endorsed by film stars, the actual package usually contains picture of international models and not film

stars.

While Lux beauty soap is sticking to the age old positioning, Lux international has moved from being a

soap brand to a skin care brand. Lux International has the tagline " Not Just Soap, Its Skin Care". Under

the Lux umbrella brand, HLL has introduced variety of personal wash products like body shampoo,hair

shampoo etc.Lux is the classic example of HLL's marketing genius. The brand will experiment and explore more in the

days to come....

http://3.bp.blogspot.com/_1pKvii0Z9Cs/Ra37ekylaDI/AAAAAAAAAOw/QTlQJGkx614/s1600-h/shahruk+lux.jpg

8/2/2019 lux. 07 final

6/39

PART 1

PART 3

ABSTRACT

Hindustan Unilever Ltd. is a well-known and largest FMCG company in India. HUL has alwaysrevamped its products to meet the changing needs of the consumer without compromising on thequality. This report deals with one of its premier brands "LUX". HUL leads the market in thetoilet soap category with 54.3% market share. Lux has inched up to be on par with Lifebuoy inHUL's soaps portfolio. The Lux brand now has an almost equal market share as HindustanLever's largest selling soap brand - Lifebuoy. This report gives an overview of the history of the

company and the brand "Lux", the various strategies adopted to survive in the market for over 75years and the various competing brands. The promotional activities adopted, the brand'sstrengths and weaknesses, threats faced are also analysed. The FMCG category is always abattleground for all the competing firms and the bathing soap category is no different. With morefirms entering the market, maintaining the customer base is not very easy. Within six months,ITC's soap products have been able to capture 1.75% of the market share.

Table of ContentsABSTRACT 2TABLE OF CONTENTS 3INTRODUCTION 4INDUSTRY ANALYSIS 5MAJOR PLAYERS 5HINDUSTAN UNILEVER LIMITED (HUL) 7a. Company profile 7b. Mission 7c. Principles of the Quality Policy 7d. Present stature 8

8/2/2019 lux. 07 final

7/39

PART 1

e. Divisions 9f. Hindustan Lever network 10g. Exports 11h. Water 11i. Corporate Responsibility 12

LUX 13STUDY OF LUX WITH RESPECT TO 4 Ps 14a. Product 14b. Promotion 16c. Price...22d. Place 23SWOT ANALYSIS 24COMPETITOR ANALYSIS 26MARKET SEGMENTATION 28POSITIONING 29BCG MATRIX 30

ANSOFF MODEL FOR LUX: 31RECOMMENDATION 32REFERENCES 33

Introduction

The origins of personal cleanliness date back to prehistoric times. Since water is essential forlife, the earliest people lived near water and knew something about its cleansing properties - atleast that it rinsed mud off their hands.

A soap-like material found in clay cylinders during the excavation of ancient Babylon isevidence that soap making was known as early as 2800 B.C. Inscriptions on the cylinders saythat fats were boiled with ashes, which is a method of making soap, but do not refer to thepurpose of the "soap." Such materials were later used as hair styling aids.

Soap got its name, according to an ancient Roman legend, from Mount Sapo, where animalswere sacrificed. Rain washed a mixture of melted animal fat, or tallow, and wood ashes downinto the clay soil along the Tiber River. Women found that this clay mixture made their washcleaner with much less effort.

Some of the early instances of commercial manufacturing of soap are:

In Britain references began to appear in the literature from about 1000AD, and in 1192 the monk

8/2/2019 lux. 07 final

8/39

PART 1

Richard of Devizes referred to the number of soap makers in Bristol and the unpleasant smellswhich their activities produced

A century later soap making was reported in Coventry. Other early centers of productionincluded York and Hull. In London a 15th century "sopehouse" was reported in Bishopsgate,

with other sites at Cheapside, where there existed Soper's Lane (later renamed Queen Street), andby the Thames at BlackfriarsvAndrew pears. In 1789, he commenced production of a transparentsoap at a factory in Wells Street, off Oxford Street and became hugely successful.

Industry analysisThe toilet soaps market is estimated at 530,000 tpa including small imports. The market islittered over with several, leading national and global brands and a large number of small brands,which have limited markets. The popular and premium brands include Lifebuoy, Lux, Cinthol,Liril, Rexona, and Nirma.

Toilet soaps, despite their divergent brands, are not well differentiated by the consumers. It is,therefore, not clear if it is the brand loyalty or experimentation lured by high volume mediacampaign, which sustain them. A consequence is that the market is fragmented. It is obvious thatthis must lead to a highly competitive market. Toilet soap, once only an urban phenomenon, hasnow penetrated practically all areas including remote rural areas. The incremental demand flowsfrom population increase and rise in usage norm impacted as it is by a greater concern forhygiene. Increased sales revenues would also expand from up gradation of quality or per unitvalue.

As the market is constituted now, it can be divided into four price segments: premium, popular,discount and economy soaps. Premium soaps are estimated to have a market volume of about80,000 tonnes. This translates into a share of about 14 to 15%.Soaps form the largest pie of the FMCG Market with bathing & toilet soaps accounting foraround 30% of the soap market, by value. Currently, the soap industry is divided into threesegments namely Premium, Popular and Economy/ Sub popular.

To fight competition, major players Hindustan Unilever Ltd (HUL), Godrej Consumer ProductsLtd (GCPL) and Wipro Consumer Care & Lighting are now drawing up fresh game plans. And

8/2/2019 lux. 07 final

9/39

PART 1

the accent is clearly on innovation to gain mind share as well as market share in thisovercrowded category.

Major Players

Hindustan Unilever Ltd.

With over seven brandsLUX, LIFEBUOY, HAMAM, REXONA, BREEZE, DOVE andPEARShas 54.3% share of the overall soap market. HUL is India's largest Fast MovingConsumer Goods Company; its journey began 75 years ago, in 1933, when the company wasfirst incorporated. The company stirring the lives of two out of three Indians with over 20distinct categories in Home & Personal Care Products and Foods & Beverages and also one ofthe country's largest exporters. HUL's brands includes Lifebuoy, Lux, Surf Excel, Rin, Wheel,Fair & Lovely, Pond's, Sunsilk, Clinic, Pepsodent, Close-up, Lakme, Brooke Bond, Kissan,Knorr-Annapurna, Kwality Wall's - are household names across the country. They aremanufactured in over 40 factories across India. In the Rs7,000 crore by sales soap market,

HULs market share has dropped to 54.3% in March 2008 from 55.9% in March 2006.

Godrej Consumer Products

GCPL, Indias second largest soap maker after Hindustan Unilever Ltd, has nearly 9.2% marketshare. With 11% market share in value terms, it is the second largest soap maker after HindustanUnilever. Godrej Consumer Products (GCPL) is a major player in the Indian FMCG market withleadership in personal, hair, household and fabric care segments. The company is one among thelargest marketer of toilet soaps in the country with leading brands such as CINTHOL,FAIRGLOW, NIKHAR, & ALLCARE. Fairglow brand, India's first Fairness soap, has createdmarketing history as one of the most successful innovations. It is also the preferred supplier forcontract manufacturing of toilet soaps, some of which are the most well-known brands in thecountry.

Wipro

In the Indian market, Wipro is a leader in providing IT solutions and services for the corporatesegment in India. Wipro also has a profitable presence in niche market segments of infrastructureengineering, and consumer products & lighting.Wipro has made a large acquisition in theConsumer Care business. The presence of Wipro in the toilet soap industry can be seen throughtheir brands such as SANTOOR and CHANDRIKA. With industry leading organic growth ratesand the acquisition, Consumer care business has reached a Revenue run rate in excess of $100million per quarter.

Procter & Gamble India

Procter & Gamble India (PGHHCL) was incorporated in 1964 after Procter & Gamble, US,acquired Richardson Vicks, US. Formerly known as Richardson Hindustan (the Indian

8/2/2019 lux. 07 final

10/39

PART 1

subsidiary), it was later named as P&G. It changed its name again in 1998 to Procter & GambleHygiene and Health Care in order to reflect the nature and character of the business of thecompany. During 2004-05 the company has increased its installed capacity of Soaps &Detergents and Toilet Preparations etc by 36500 Tonnes and 263 Tonnes respectively. With thisexpansion the total installed capacity of Soaps & Detergents and Toilet Preparations etc has

increased to 108500 Tonnes and 5875 Tonnes respectively.

Nirma

Incorporated as a private limited company, Nirma was converted into a deemed public companyand then to a public limited one in Nov.'93. Nirma has a leadership presence in Detergents,Soaps and Personal Care Products. To have a greater control on the quality and price of its rawmaterials, Nirma undertook backward integration into manufacture of Industrial Products likeSoda Ash, Linear Alkyl Benzene (LAB), Alfa Olefin Sulphonates (AOS), Fatty Acid, Glycerineand Sulphuric Acid. During 1996-97, Nilnita Chemicals, Nirma Detergents, Nirma Soaps andDetergents, and Shiva Soaps and Detergents were amalgamated with the company. The company

created 'Nirma Consumer Care Ltd.' - a wholly owned subsidiary on 22nd Aug.'97, which is thesole licensee of the brand name 'Nirma' within India. Nirma enjoys a share of 6.74% in soaps.

ITC

ITC, the countrys largest cigarette maker, entered the segment last year and has made a strong

headway in a short time. According to AC Nielsen, its share has grown to 1.75% in just fivemonths despite the fact that many of its brands such as Superia, Fiama Di Wills and Vivel arecurrently sold in only six states.

HINDUSTAN UNILEVER LIMITED (HUL)a.Company profile

Hindustan Unilever Limited (HUL), a 52%-owned subsidiary of Anglo-Dutch giant Unilever,has been working its way into India since 1888. Formerly known as Hindustan Lever Limited.The Group's principal activities are to manufacture and market consumer products. HindustanUnilever Limited (HUL), a subsidiary of Unilever, is a fast moving consumer goods (FMCG)company based in India. The company focuses on efficient delivery to consumers with animproved supply chain, brand building initiatives and innovation, which has helped the companyto sustain its leadership position in the overall FMCG category in India.b.Mission

Unilever's mission is to add Vitality to life. They meet everyday needs for nutrition, hygiene andpersonal care with brands that help people feel good, look good and get more out of life.Their deep roots in local cultures and markets around the world give them strong relationshipwith consumers and are the foundation for their future growth.

A key requirement is building in the quality expectations of their consumers into their products.

8/2/2019 lux. 07 final

11/39

PART 1

To win consumers confidence and loyalty, they need to consistently deliver branded products ofexcellent quality.

The Quality Policy describes the principles that everyone in Unilever follows, wherever they are

in the world, to ensure that they are recognised and trusted for their integrity, the quality of theirbrands and products, and the high standards they set.c. Principles of the Quality Policy

Putting the safety of their products and consumers first.

HUL has stringent mandatory quality standards in place against which compliance is verifiedthrough regular audits and self assessments. These standards ensure they design, manufactureand supply products that are safe, of excellent quality, and conform to the relevant industry andregulatory standards in the countries in which they operate.

They actively engage consumers and customers, translating their needs and requirements intoproducts and services, thus creating consumer value wherever they position their products.

Quality is a shared responsibilityQuality and consumer safety is the responsibility of every Unilever employee and Unileverdemonstrates visible and consistent leadership to meet this policy. The drive for quality, in allthat they do, is a passion reflected in their brand development, manufacturing and customerservice processes.

d. Present stature

Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods company,touching the lives of two out of three Indians with over 20 distinct categories in Home &Personal Care Products and Foods & Beverages. They endow the company with a scale ofcombined volumes of about 4 million tonnes and sales of nearly Rs.13718 crores.

HUL is also one of the country's largest exporters; it has been recognised as a Golden Super StarTrading House by the Government of India.

The mission that inspires HUL's over 15,000 employees, including over 1,300 managers, is to"add vitality to life." HUL meets everyday needs for nutrition, hygiene, and personal care withbrands that help people feel good, look good and get more out of life. It is a mission HUL shareswith its parent company, Unilever, which holds 52.10% of the equity. The rest of theshareholding is distributed among 360,675 individual shareholders and financial institutions.

HUL's brands - like Lifebuoy, Lux, Surf Excel, Rin, Wheel, Fair & Lovely, Pond's, Sunsilk,Clinic, Pepsodent, Close-up, Lakme, Brooke Bond, Kissan, Knorr-Annapurna, Kwality Wall'sare household names across the country and span many categories - soaps, detergents, personalproducts, tea, coffee, branded staples, ice cream and culinary products. They are manufactured

8/2/2019 lux. 07 final

12/39

PART 1

over 40 factories across India. The operations involve over 2,000 suppliers and associates. HUL'sdistribution network, comprising about 4,000 redistribution stockists, covering 6.3 million retailoutlets reaching the entire urban population, and about 250 million rural consumers.

HUL has traditionally been a company, which incorporates latest technology in all its operations.

The Hindustan Unilever Research Centre (HURC) was set up in 1958, and now has facilities inMumbai and Bangalore. HURC and the Global Technology Centres in India have over 200highly qualified scientists and technologists, many with post-doctoral experience acquired in theUS and Europe.

Group operates through seven segments: Soaps and Detergents, Personal Products, Exports,Beverages, Foods, Ice Creams and Other. The products include home and personal care products,foods and beverages, industrial and agricultural products. Home and personal care productsconsists of personal and fabric wash, household, oral care, skin and hair care, deodorants,perfumery, colour cosmetics and baby care. Foods and beverages includes tea, coffee, cookingfats and oils, bakery fats, ice creams, tomato products, fruit and vegetable products, rice, salt, atta

and rawa, marine products and mushrooms. Industrial and agricultural products includesspecialty chemicals, bulk chemicals, fertilisers, animal feeds, seeds, plant growth nutrients,processed-tri-glycerides and agri commodities, yeast, leather, footwear and carpets,thermometers and plantations.

Its brands are spread across 20 consumer product categories. Hindustan Unilever marketsconsumer goods throughout India. The company faces competition from international, local andregional players.The company derives 44.3% of its revenues from soaps and detergents, 26.6% from personalcare products, 10.5% from beverages, and the rest from foods, ice creams, exports, and otherproducts. As counterfeit trade increases, the company stands to lose on its brand equity andexclusivity.

New Products introduced by HUL in recent years: Lux strawberry and cream Clinic plus multi sachet Ponds age miracle Axe shock and recover Paddle pop Wheel active Green

e. Divisions

Home and Personal Care

The HPC business is made up of Fabric Wash, Household Care, Personal Wash and PersonalCare categories. Personal Wash: Lux, Lifebuoy, Liril, Hamam, Breeze, Dove, Pears, Rexona Laundry: Surf excel, Rin, Wheel Skin care: Fair and Lovely, Ponds, Vaseline, Aviance

8/2/2019 lux. 07 final

13/39

PART 1

Oral care: Pepsodent, Close up Deodorants: Axe, Rexona Colour cosmetics: Lakme Ayurvedic personal and health care: Ayush

Foods

The Foods Division of your Company comprises Beverages, Processed Foods, Ice-Creams andModern Foods businesses. The Division recorded strong growth in 2007. Tea: Brooke Bond, Lipton Coffee: Bru Foods: Kissan, Annapurna, Knorr Ice cream: Kwality walls

f. Hindustan Lever network

Started in 2003, Hindustan Unilever Network (HUN) is HUL's Direct Selling arm. It is a multi-category direct selling business offering a wide range of high-quality,high-performance products for its consumers and also exciting business and personaldevelopment opportunities for its consultants. It already has about 7 lakh consultants - allindependent entrepreneurs, trained and guided by HUN's expert managers and trainers.

HUNs mission is to a create millionaire club in India. There are many consultants who are

earning at over a rate of Rs.1,00,000 per annum. Several consultants earn over Rs.50,000 permonth.

HUN offers to build a business with different categories of Home & Personal Care (HPC) andFood products. They are all essential household needs. And they are all exclusive to HUN,specifically developed for the Direct Selling channel, and not available in the retail channel.

HUN has already spread to 1500 towns and cities, backed by 28 offices and over 130 servicecentres across the country. HUN's vision is to earn the love and respect of India by making a realdifference to the lives of million Indians.g. ExportsToday, HUL is one of Indias Largest exporters of branded Fast Moving Consumer Goods. It has

been recognized by the Government of India as a Golden Super Star Trading House.

Over time HUL has developed into a viable & competitive sourcing base for Unilever worldwide in Home and Personal Care & Foods & Beverages category of products. HUL is also aglobal marketing arm for select licensed Unilever brands and also works on building categorieswith core country advantage such as branded basmati rice.

HUL Exports offers high level of service with flexibility and responsiveness thorough out the

8/2/2019 lux. 07 final

14/39

PART 1

supply chain. It has a dedicated organization structure to support this endeavour and this hashelped in growth of these businesses in particular. Intrinsic cost competitiveness in the end toend Supply chain with appropriate technology and competitive capital investment operationswhile delivering best in class quality enables HUL to position itself as a key sourcing hub forUnilever and also become a preferred partner for Global customers in categories we operate.

HULs key focus in the exports business is on two broad categories. It is a sourcing base for

Unilever brands in Home & Personal Care (HPC) and Food and Beverages (F&B) for supplies toother Unilever companies. It also focuses on becoming a preferred supplier to both non-Unileverand Unilever clients in three categories in which India, as a country, has competitive advantageBranded Rice, Marine Products and Castor and its Derivatives . HUL enjoys internationalrecognition within Unilever and outside for its quality, reliability and speed of customer service.HUL's Exports geography comprises, at present, countries in Europe, Asia, Middle East, Africa,Australia, North America etch. WaterPureit, a breakthrough offering of Hindustan Unilever (HUL), comes with many unique benefits

complete protection from all water-borne diseases, unmatched convenience and affordability.

Pureits unique Germkill Battery technology kills all harmful viruses and bacteria and removes

parasites and pesticide impurities, giving you water that is as safe as boiled. It assures your

family 100% protection from water-borne diseases like jaundice, diarrhea, typhoid and cholera.Pureit not only renders water micro-biologically safe, but also makes the water clear, odourlessand good-tasting.

i. Corporate Responsibility

As in the earlier years, your Company continued to involve itself in social welfare initiativesacross the Country, both through charity and social investment around issues like education,health, nutrition and initiatives for the economic upliftment of the underprivileged.The company has commenced a pilot in its tea business, in partnership with an NGO (Partners inChange) to source tea directly from small producers and thereby improve their livelihood. Theeffort of the Company in improving water availability through soil conservation and waterharvesting methods has borne good results. Company believes that brands must be at the

8/2/2019 lux. 07 final

15/39

PART 1

forefront of driving social change.

HUL is also running a rural health programmeLifebuoy Swasthya Chetana. The programmeendeavours to induce adoption of hygienic practices among rural Indians and aims to bring downthe incidence of diarrhoea. It has already touched 84.6 million people in approximately 43890

villages of 8 states. The vision is to make a billion Indians feel safe and secure.

LUX

Lux soap was first launched in 1916 as laundry soap targeted specifically at 'delicates'. LeverBrothers encouraged women to home launder their clothes without fear of satins and silks beingturned yellow by harsh lyes that were often used in soaps at the time. The flake-type soapallowed the manufacturer some leeway from lye because it did not need to be shaped intotraditional cake-shaped loaves as other soaps were. The result was a gentler soap that dissolvedmore readily and was advertised as suitable for home laundry use.

Lux toilet soap was introduced in 1925 as bathroom soap. The name 'Lux' was chosen as a playon the word "luxury." Lux has been marketed in several forms, including bar and flake and liquid(hand wash, shower gel and cream bath soap).

Lux in step with the changing trends and evolving beauty needs of the consumers, offers anexciting range of soaps and Body Washes with unique elements to make bathing time morepleasurable. One can choose from a range of skincare benefits like firming, fairness andmoisturising.Lux stands for the promise of beauty and glamour as one of India's most trusted personal carebrands. Since its launch in India in the year 1929, Lux has offered a range of soaps in differentcolours and world class fragrances. Lux is a beauty soap of film stars. Lux recognized the needfor a compelling message about beauty that would resonate with women of today.From the 1930s right through to the 1970s, Lux soap colours and packaging were altered severaltimes to reflect fashion trends. In 1958 five colours made up the range: pink, white, blue, greenand yellow. People enjoyed matching their soap with their bathroom colours.In the early 1990s, Lux responded to the growing trend away from traditional soap bars bylaunching its own range of shower gels, liquid soaps and moisturizing bars. Lux beauty facialwash, Lux beauty bath and Lux beauty shower were launched in 1992.

In 2004, the entire Lux range was re-launched in the UK to include five shower gels, three bathproducts and two new soap bars. 2005 saw the launch of three exciting new variants with dreamy

8/2/2019 lux. 07 final

16/39

PART 1

names such as Wine & Roses bath cream, Glowing Touch and Sparkling Morning shower

gels.

Lux has recently launched its two fruit extract variantsNew Lux Strawberry & Cream and LuxPeach & Cream contain a blend of succulent fruits & luscious Chantilly cream. The most recent

addition in the brand is Lux Crystal Shine.

Study of LUX with respect to 4 Psa. Product

A product is anything that can be offered to a market to satisfy a need or want. Products that aremarketed include physical goods, services, experiences, events, persons, places, properties,

organizations, information and ideas.

Product Classification LUX is a Tangible, Non Durable Good on the basis of this classification. LUX and other soaps fall into the category of Convenience Good

Product Life Cycle

LUX Beauty Bar is in the maturity stage of its life cycle.

Some of the prominent variantsLux AlmondLux OrchidLux FruitLux SaffronLux SandalwoodLux RoseLux InternationalLux ChocolateLux Aromatic ExtractsLux Oil and Honey GlowLux Provocateur

LUX Beauty Soap- Form, Features, Style

With icons of beauty endorsing the brand, the offerings made by Lux have always been superiorand have always led the market, setting benchmarks for competition.

8/2/2019 lux. 07 final

17/39

PART 1

Lux has beauty offerings in two of the four market segmentspopular and premium, spanningthe needs of varied consumers.

Lux Toilet Soap in the popular segment has in the past years offered its consumers a range ofsoaps enriched with the goodness of a variety of nourishing ingredientsrose extracts, almond

oil, milk cream, fruit extracts and honey which are known to harbour the secrets of incrediblyperfect skin.

At the upper end of the market is the premium range which continues to offer specialisedskincare to its consumers in the form of International Luxa range of moisturising, deepcleansing and sunscreen soaps.

To establish the presence of nourishing ingredients in the new Lux, a unique concept,ingredients you can see in the soap, was born. A novel metallic substrate packaging beautifullyshowcased the ingredients and its globally accepted ingredient-linked perfumes heightened thesensorial experience.

Each of the soaps in the range has milk cream, with the active ingredients of rose extracts, sandalsaffron, almond oil and fruit extracts. These create an experience in pampering indulgence andluxury designed to bring out the star in every woman. This is the first time in the Indian chapterof the brand that the beauty bar variant was being differentiated on the basis of its ingredientsrather than its perfume and colours.Though Lux International, a premium variant of the toilet soap, launched in 1989, isdifferentiated on the basis of its ingredients, the popular version, Lux Beauty Bar was alwaysprojected as a pure and mild solution to soft and smooth skin.

Logo

Labelling

The LUX Trade Character or Logo is present prominently on the package. A novel metallicsubstrate packaging showcases the ingredients, and a female model is shown on the pack. Alsodisplayed graphically are the key ingredients.

PackagingThe colors are different for different variants such as saffron for the saffron variant, pink for therose extracts etc.The Bars come in package sizes of 100g, 120g, 150 g

Lux has also launched a 45 g variant called Mini Lux priced at Rs. 5.

8/2/2019 lux. 07 final

18/39

PART 1

b. Promotion

The great Indian brand wagon started nearly four decades ago. Great brands sometimes outlasttheir ambassadors as proven by Lux which celebrated its 75th anniversary in India.

The first ambassador, Leela Chitnis featured in a Lux advertisement which flagged off the Luxwagon. She gave way to a galaxy of stars which includes Madhubala, Nargis, Meena Kumari,Mala Sinha, Sharmila Tagore, Waheeda Rehman, Saira Banu, Hema Malini, Zeenat Amaan, JuhiChawla, Madhuri Dixit, Sridevi, Aishwarya Rai and Kareena Kapoor. The last frontier for mostactors aspiring to stardom is becoming a Lux ambassador. The brand has outlasted many soaps.From the beginning, Lux became a household name across the country.

Advertising

Advertising is any paid form of non-personal presentation and promotion of ideas, goods andservices by an identified sponsor. Ads can be a cost effective way to disseminate messages,

whether to build a brand preference or to educate people.

LUX ADVERTISEMENTS THROUGH THE AGES

Leela Chitnis in the first Lux print adverstisement featuring an indian actress

Aishwarya Rai in a print advertisement featuring Lux international

Priyanka Chopra in the latest Lux advertisement

USP or the common thread through all the advertisements is the Presence of Movie Stars

through the ages. The product has been positioned on the basis of REFERENCE GROUP by using a celebrity

popular at that point in time. Some amount of attribute positioning by mentioning the various ingredients has also been done.

Lux campaigns have wooed millions of people over the decades. Popularly known as the beauty

8/2/2019 lux. 07 final

19/39

PART 1

soap of film stars, Lux has been an intimate partner of the brightest stars on the silver screen fordecades. An ode to their beauty, an announcer of their stardom, advertising campaigns on Luxhave featured film stars across the nation, promising their beauty and complexion to ordinarywomen.

With top movie starsfrom Madhubala to Madhuri, from Babita to Karisma and Kareena havingendorsed the goodness of Lux over generations, it was natural that the brand has built equity asthe best beauty soap in India.

From the beginning Lux, by using a leading film star of the time, has fulfilled the consumersaspirations of using beauty soaps via the rationale if its good enough for a film star, its good

for me. This later moved into a transformation role of having a bath with Lux, which transportsthe user into a fantasy world of icons, film stars and fairy lands.

Change in communication strategy

However, the communication was slowly seen to be losing relevance, as consumers werebeginning to question if the film star actually used the brand.In addition to this, several competitive beauty soap brands had begun advertising using similarmethods of communication. In this context, the global brand team for Lux developed a newcommunication strategy. This strategybring out the star in youfor the first time moved thebrand away from the long-running film star route. The film star still features in the newcommunication but not as her gorgeous self but rather as an alter ego/projection of theprotagonist (a regular girl), for a few seconds of the entire ad.Thus, for the first time the film star was used as a communication device and not as the mainfeature of the ad. The move away from the film star and her fantasy world to a regular Lux user,with the focus on the protagonists star quality, is a change from the norms set by Luxadvertising in the past. With the new communication strategy, the film star is used purely as acommunication device to portray star quality in every Lux user. This can be significantly seen inthe latest TV commercial of Lux Crystal Shine where Priyanka Chopra is portrayed as a normalwoman.

This ideabring out the star in youputs the consumer at the heart of the brands promise. Thispromise goes beyond the functional deliverables of soap, beyond bathing and the bathroom to theworld outside. Its a world where with Lux on her side, an ordinary woman can impact her world

with her own star quality.

This is a successful attempt to bring the brand closer to its users and to give it a more youthfuland contemporary image.

Breaking away from tradition, HLL resorts to a male and metro sexual Shah Rukh to revive Lux,which turned 75 in 2005.

8/2/2019 lux. 07 final

20/39

PART 1

Sales Promotion

Sales promotion, a key ingredient in marketing campaigns, consists of a collection of incentivetools, mostly short term, designed to stimulate quicker or greater purchase of particular productsor services by consumers or the trade.

Whereas advertising offers a reason to buy, sales promotion offers an incentive to buy.Sales promotion includes tools forProminent Sales Promotion Schemes Used By LUX Lux presented 30 gm gold each to the first three winners of the Lux Gold Star offer from Delhi.

According to the promotional offer that Lux unveiled in October 2000, a consumer finding a 22-carat gold coin in his or her soap bar got an opportunity to win an additional 30 gm gold. Thefirst 10 callers every week got a 30 gm gold each.The offer could be availed only on 100 gm and 150 gm packs of Lux soap.

Lux Star Bano, Aish Karo contest: All one needed to do was buy a special promotional pack ofLux soap. The pack comes with a special scratch card. The 50 lucky winners and their spouses

were flown down to Mumbai to live a day like Aishwarya Rai would. They could also be givengift vouchers worth Rs 50,000 from Shoppers' Stop along with an exclusively designed NeetaLulla sari and a beauty makeover by Michelle Tung, Aishwarya's preferred designer and stylist.The pice de rsistance was a dinner date with Aishwarya Rai herself.

Lux celebrated 75 years of stardom with the Har Star Lucky Star activity.All wrappers of Lux had a star printed inside them. If the consumer found written inside the star,any number from 1 to 5, she would get an equivalent discount (in rupees) on her purchase

from her shopkeeper. Ifthe consumer found 75 years written inside the star, she will get ayears supply of Lux free.

Online contests:

Play the supercharged version of the hit puzzle game, Bejeweled. Create rows of 3 or moreidentical stones and you could win a trip for two to a five-star Resort in Goa.

Public Relations:

Not only must the company relate constructively to customers, suppliers and dealers, it must alsorelate to a large number of interested publics. A public is any group that has an actual orpotential interest in or impact on a companys ability to achieve its objectives. PR involves avariety of programs designed to promote or protect a companys image or its individual products.

LUX PR Activities Press relations:Lux has been maintaining constant communicating with its customers and potential customers,of the various developments taking place in the brand by using press relations.

8/2/2019 lux. 07 final

21/39

PART 1

Events:Lux celebrated 75 years of existence in a grand way by unveiling Shahrukh Khan as their latestbrand ambassador. Kareena Kapoor, Juhi Chawla, Sridevi and Hema Malini graced the event andmade it special. All the stars have endorsed Lux in the past. The event was held at the grandIntercontinental in Mumbai.

Limited edition:Coming up with limited edition of the brand is also a way of attracting attention towards thebrand. It creates a buzz and a feeling of urgency to try out the product and helps in promotion ofthe brand. This strategy was also implemented by Lux by bringing out limited editions likeChocolate Seduction, Aromatic Glow, Festive Glow and Haute Pink.

c. Price

If price is too high then a company may never sell a single item of it. If price is too low then onecan lose money on every sale once all of costs of doing business are considered. Therefore the

key is to price it in such way that it appears attractive to the customer as well as profitable to thecompany. HUL seems to have mastered this idea. Prices of HUL are considered the mostcompetitive in Indian market. The main fact for this huge success story is the strategic pricingdecision the company has adopted from time to time.

HUL always gives value for money to their consumers. It is known for its competitive pricing. Ithas the advantage of quoting a reasonable price due to its economies of scale. HUL also canquote a very competitive price due to its superior technology and optimum utilization ofinventory. It has the product range that meets the needs of all classes of consumers. It has theproducts that are categorized as premium and mass products. HUL matches its prices with thecompetitor who is operating in the same category. HUL also gives price offs on its products toreward consumers who are using it for a long time and also to attract new consumers.

The price of the premium segment products is twice that of economy segment products. Theeconomy and popular segments are 4/5ths of the entire soaps market.

Price segments of toilet soapsSegment Price/weightPremium > Rs. 15 / 75 gmsPopular Rs. 8-15/75 gmsEconomy < Rs. 8 /75 gms

However, recently HUL has been forced to hike its price by one rupee, to Rs17 (for 100 gm),giving in to the pressures of inflation. This paves the way for competing soap makers like GodrejConsumer Products (GCPL) to take price increases.

Lux has versions in all the three price segments:

Recent pricing of Lux (100 g)

8/2/2019 lux. 07 final

22/39

PART 1

Lux Crystal Shine Rs 17Lux Festive Glow Rs 15Mini Lux Rs 5

d. Place

Cutting-edge distribution network

HULs distribution network is recognized as one of its key strengths -- that which helps reach outits products across the length and breadth of this vast country. The need for a strong distributionnetwork is imperative, since HULs corporate purpose is to meet the everyday needs of people

everywhere.At Hindustan Unilever Limited, distribution network is one of the key strengths that help themreach their products across the length and breadth of this vast country. It has 2000+ suppliers and

associates 7,000 stockists and direct coverage in over 1 million retail outlets across India.To meet the ever-changing needs of the consumer, HUL has set up a distribution network thatensures availability of all their products, in all outlets, at all times. This includes, maintainingfavourable trade relations, providing innovative incentives to retailers and organizing demandgeneration activities among a host of other things. HUL boasts of placing a product across thecountry in less than 72 hrs.The first phase of the HUL distribution network had wholesalers placing bulk orders directlywith the company. Large retailers also placed direct orders, which comprised almost 30 per centof the total orders collected.Today, the goods are transferred from the factory to the company warehouses and are sent to thedistributor from there on a daily basis. From the distributor, the stock reaches the market throughdaily sales. Typically, these include the salesman registering the order of a retail outlet anddelivering the goods the next day.Recently HUL has changed its traditional way distribution and came out with a new strategy ofdistribution. Its because of the change in buying pattern of the consumer due to more disposableincome. There are different channels of distribution like Modern Trade, which covers all chainsof super markets like Food World, who get the stocks directly from the company. Wholesalersand second leg of big retail outlets called Super Value stores come under the surveillance of thedistributor along with the mass retail outlets. There is also this new concept in the HULdistribution channel called Kiosk. Kiosk is a small shop that sells only sachets and low priceditems (below Rs.10/-). Kiosk also does not come under the surveillance of the distributor.

In addition to the ongoing commitment to the traditional grocery trade, HUL is building a specialrelationship with the small but fast emerging modern trade. HUL's scale enables it to providesuperior customer service including daily servicing, improving their range availability whilstreducing inventories. HUL is using the opportunity of interfacing more directly with consumersin this retail environment through specially designed communication and promotions. This isbuilding traffic into the stores while yielding high growth for the business.

RSNet

8/2/2019 lux. 07 final

23/39

PART 1

An IT-powered system has been implemented to supply stocks to redistribution stockists on acontinuous replenishment basis. The objective is to catalyse HULs growth by ensuring that the

right product is available at the right place in right quantities, in the most cost-effective manner.For this, stockists have been connected with the company through an Internet-based network,

called RSNet, for online interaction on orders, dispatches, information sharing and monitoring.RS Net covers about 80% of the company's turnover. Today, the sales system gets to know everyday what HUL stockists have sold to almost a million outlets across the country. RS Net is partof Project Leap, HUL's end-to-end supply chain, which also includes a back-end systemconnecting suppliers, all company sites and stretching right up to stockists. Powered by the ITtools it has improved customer service, while ensuring superior availability and impactfulvisibility at retail points.

For rural India, HUL has established a single distribution channel by consolidating categories. Ina significant move, with long-term benefits, HUL has mounted an initiative, Project Streamline,to further increase its rural reach with the help of rural sub-stockists. As a result, the distribution

network directly covers about 50,000 villages, reaching about 250 million consumers.

Distribution will acquire a further edge with Project Shakti, HUL's partnership with Self HelpGroups of rural women. The project, started in 2001, already covers over 5000 villages in 52districts of Andhra Pradesh, Karnataka Madhya Pradesh and Gujarat, and is being progressivelyextended. The vision is to reach over 100,000 villages, thereby touching about 100 millionconsumers. The SHGs have chosen to adopt distribution of HUL's products as a businessventure, armed with training from HLL and support from government agencies concerned andNGOs. A typical Shakti entrepreneur conducts business of around Rs.15000 per month, whichgives her an income in excess of Rs.1000 per month on a sustainable basis. As most of thesewomen are from below the poverty line, and live in extremely small villages (less than 2000population), this earning is very significant, and is almost double of their past household income.

For HUL, the project is bringing new villages under direct distribution coverage. Plans are beingdrawn up to cover more states, and provide products/services in agriculture, health, insuranceand education. This will both catalyse holistic rural development and also help the SHGsgenerate even more income. This model creates a symbiotic partnership between HUL and itsconsumers, some of whom will also draw on the company for their livelihood, and helps build aself-sustaining cycle of growth.

SWOT ANALYSIS

SWOT analysis is a basic, straightforward model that provides direction and serves as a basis forthe development of marketing plans. It accomplishes this by assessing an organizations strengths(what an organization can do) and weaknesses (what an organization cannot do) in addition toopportunities (potential favorable conditions for an organization) and threats (potentialunfavorable conditions for an organization). The role of SWOT analysis is to take theinformation from the environmental analysis and separate it into internal issues (strengths andweaknesses) and external issues (opportunities and threats). Once this is completed, SWOTanalysis determines if the information indicates something that will assist the firm in

8/2/2019 lux. 07 final

24/39

PART 1

accomplishing its objectives (a strength or opportunity), or if it indicates an obstacle that must beovercome or minimized to achieve desired results (weakness or threat) (Marketing Strategy,1998).

The SWOT analysis summarizes the external environmental factors as a list of opportunities and

threats.

SWOT PROFILE OF LUX

STRENGTHS

1.Strong Market Research (door to door sampling is done once a year in Urban and Rural areas)2.Many variants (Almond Oil, Orchid Extracts, Milk Cream, Fruit Extracts, Saffron, SandalwoodOil, and Honey to name a few)3.Strong sales and distribution network backed by HLL4.Strong brand image

5.Positioning focuses on the attractive beauty segment6.Dynamically continuous innovation of the product and brand rejuvenationnew variants(Aromatic Glow and Chocolate Seduction and Lux White Spa body wash) and innovativepromotions (22 carat gold coin promotionChance Hai)7.Perceived to have high value for money (strong brand promotion but relatively lower pricewhich is a winning combination in the popular segment)8.Though it is in popular segment, it is having mass appeal/market presence across all segments(15% of the soap market captured by Lux (sales / volume)9.Unique advantage of having access to resources and assets of HLL

WEAKNESSES

1.Lux is mainly positioned as beauty soap targeted towards women, hence it lacks unisex appeal2.Usage rate/ wear rate is high and is generally mushy and soggy3.Some variants like the sunscreen, International variant did not do well in the market4.Certain advertisements like the recent one with Shah Rukh Khan resulted in controversialinterpretations of the message of the advertisement and lead to some loss of focus (of message ofthe advertisements)5.Stock out problems - replenishment time is high in semi-urban/rural areas6.Earlier positioning as the soap of the stars has somewhat alienated the brand from a portion

of the consumers especially in rural areas.

OPPORTUNITIES

1. Soap industry growing by 10% in India2. Beauty segments Compounded Annual Growth Rate (CAGR) is very high. An indication of

this is that Fair and Lovelys segment is increasing at a fast rate - Lux must reinforce its presencein the beauty segment3. More promotions like price-offs and samples4. Retentive strategy required as the soap segment is in the mature stage of its product life cycle

8/2/2019 lux. 07 final

25/39

PART 1

5. Line extensionprobably with more variants catering to the beauty segment like natural,herbal soap etc6. Liquid body wash is currently in the growth stageLux should come out with more variantsin this segment7. Level of servicing is high during sales promotion schemesthis could be brought down

8. It has a large market share and hence has a strong hold over the market

THREATS

1. New entrants/local competitors/MNCs would increase the competition (Camay, P&G)2. High internal competitionPears also catering the beauty segment (also from HLL stable)3. Excessive dependence on beauty segment makes Lux vulnerable to changing customer tastes4. Technological change makes the existing products obsoleteLux should focus ontechnological innovations like Body Wash5. Its in the maturity stage in the Product Life Cycle and has a threat of slipping down to declinestage if constant reinvention of the brand is not carried out.

Competitor analysis

Internal competitors

Lifebuoy:Born: 1895History: Owned by Unilever Plc., the parent company of Hindustan Unilever Ltd.Status: Has 18% market share in the bathing soaps category, worth Rs6,000 croreLifebuoy landed on Indian shores in 1895, when the country was in the grip of a plagueepidemic. With its positioning as a powerful germicidal and disinfectant, and with a strongcarbolic smell, it was what the nation was looking for. But the health advantage waned over timeas competitors came out with soaps that promised both health and beauty.It was around 2002 that the product moved from being a hard soap to a mild soap that delivered asignificantly superior bathing experience. The new soap had a refreshing fragrance and itsoverall positioning changed, painting its promise of health in softer, more versatile andresponsible huesfor the entire family. The packaging was also changed: The rugged lookingpacks were soon replaced with a softer pinkish cover. This was followed by a series of adshighlighting the soaps germ-fighting benefits.Lifebuoy had become a family soap with hygiene as its core promise. Right from the early days,the brand has preferred effective communication to celebrities. An exception is its recent, limitedexposure campaign with cricketer Yuvraj Singh.

External Competitors

Santoor:Santoor is the flagship brand in the Wipro Consumer Care & Lighting stable and the 2nd largestbrand of soap in India in the popular segment of the category. The brand enjoys two decades oftrust since its launch in 1986 and has grown to be counted amongst the top brands in the Country

8/2/2019 lux. 07 final

26/39

PART 1

in an intensively competitive market. Millions of women across the country have discovered thesecret of younger looking skin with Santoor. It is a truly unique soap that combines the goodnessof natural ingredients - Sandal, Turmeric and natural Skin Softeners. Sandal provides a coolingand soothing effect that softens skin, while turmeric controls formation of skin darkeningpigments like melanin, to give skin a radiant glow. Natural Skin Softeners make skin soft and

supple. The end result, skin that is so healthy and beautiful, it lies about your actual age!Amongst the first brands in the Country to launch an offering with the twin ingredient benefits ofSandal and Turmeric, Santoor has over the years moved from a purely natural ingredient basedappeal, to one of the most preferred beauty soaps of the day. Today, Santoor is one of the fastestgrowing soap brands in India. Santoor is available in three variantsSantoor (Sandal &Turmeric), Santoor White (Sandal & Almond milk) and Santoor Chandan which is a premiumsoap manufactured with extracts of Sandalwood oila favourite of discerning consumers.Cinthol:

Cinthol the popular and much-loved brand of Godrej Consumer Products Limited (GCPL)havebeen a favourite of people for many years. All different soaps in its range are having feel-fresh

fragrance and high TFM index. Cinthols range covers an economic Lime-fresh, the mediumdeo-soaps (spice, lime,cologne and the new sport) and a slightly expensive Cinthol-Original.For decades, Cinthol-Original is one of the best soaps made in India. It had a simple red-coverwhich attracts none! But was still able to sustain itself in the market . Godrej has now launchedthe improved Cinthol range. Cinthol now offers a deo-range of soaps, talc and deo-sprays inthree exciting fragrances - Classic, Cologne and Sport in a trendy new packaging. It also offersCinthol fresh soap and Cinthol Regular soap with new exciting packaging. The eye-catching andvibrant packaging symbolizes a sense of adventure, zest and action. The new Cinthol rangebrings 24-Hour Confidence through Active Deo Formula, which controls body odour, PowerfulDryShield that absorbs sweat, UltraScent Technology for long lasting fragrance and Freshnessthat revitalises you 24x7.The new range will be available across the country at modern retail andother outlets and will be supported by high-impact advertising on television, print, out-door, on-line and radio.

Vivel and Superia:

The Vivel Di Wills range is available in two variants. Its unique carton pack has been developedby ITC's design team to provide a novel consumer experience. Vivel Di Wills Sheer Radiance isenriched with Olive Oil, to provide skin lustre to make it radiant. Vivel Di Wills Sheer Crme isenriched with Shea Butter, to moisturize skin to make it soft and supple.

The Vivel range of soaps is available in four variants:-Vivel Young Glow is enriched with Vitamin E and Fruit Infusions which help in providingyouthful glow to the skin.Vivel Satin Soft is enriched with Vitamin E and Aloe Vera which help the skin feel beautifullysoft.Vivel Sandal Sparkle is enriched with Sandalwood Oil and Active Clay which helps in providingclear skin.Vivel Ayurveda Essence is enriched with multiple Ayurvedic Ingredients which help protect skinfrom germs and harsh environment, keeping it healthy and beautiful.

8/2/2019 lux. 07 final

27/39

PART 1

In the popular segment, ITC has launched a range of soaps and shampoos under the brand nameSuperia. Superia Soaps enriched with natural ingredients give radiant glowing skin. SuperiaSoaps are available in four variants :1. Fragrant Flower: with the fragrance of Rose & Lavender Oil

2. Soft Sandal: with the fragrance of Sandal & Almond Oil3. Natural Glow: with Neem & Coconut Oils4. Healthy Glow: with Orange Oil

Market SegmentationOne cannot be everything to everyone, but can be everything to a selected few. This is the

basis for segmentation. The definition of segmentation is market segmentation is a process of

dividing a heterogeneous market into homogeneous sub units. Market segmentation is theidentification of portions of the market that are different from one another. Segmentation allowsthe firm to better satisfy the needs of its potential customers.A good market segmentation will result in segment members that are internally homogenous and

externally heterogeneous; that is, as similar as possible within the segment, and as different aspossible between segments.Market segmentation of Lux

As mentioned above, market segmentation is done so as to satisfy the customers more efficiently.For a brand like Lux, which has a broad customer base, this factor becomes absolutely critical.The segmentations are done basically on the basis of factors like:

Lux soap concentrates in the beauty soap category. A brief description of the various factors Luxconsiders are:

Gender :

Lux has been, since its introduction seen as a soap for women. Lux as a brand symbolises beauty.The Lux ads has hosted a bevy of film stars such as from Madhubala, Babita, Hema, Karisma toKareena all endorsing the goodness of Lux over generations. This was done in order to attractwomen who wanted to look and feel like the stars they idolised.

Age :

Lux is seen to mainly attract customers that fall within the age group of 16 to 35. In order tocater them, Lux comes up with new and interesting variants. One of the latest entrants, LuxCrystal Shine is mainly targeted at the youth . So is the Black Provocateur which symbolisesboldness . Another example is the chocolate variant lux which was a novel idea. All these areintroduced to catch the attention of the youth.

Income :

One of the essential characteristic of an FMCG product is an affordable price which is veryimportant for its fast sales. Its the meeting point of demand for a product and its price that decide

8/2/2019 lux. 07 final

28/39

PART 1

whether the product will sell or not. And the demand for a product is highly dependant on theincome of the customer. Lux is not a very costly toilet soap. Its price varies from Rs.15 tors.20.Therefore its target market starts from the middle income group.

Positioning

Luxderived from the word luxurywas launched in 1899 as a laundry soap in the UK. In1925, the brand was extended to the toilet soap category. It was positioned as a beauty soap inIndia, and HUL has since used successful film actors of the timesuch as Leela Chitnis,Madhubala, Hema Malini and Kareena Kapoorto endorse the product.Luxs secret of longevity has been its consistent evolutionbe it the soap colour, packaging ornew variants, the brand has banked on innovation to keep its youthful image intact. Extendingthe soap cake to a range of shower gels, liquid soaps and moisturizing bars has helped the brandkeep consumers excited and the competition at bay.What has not changed is the consistency in its communication and its positioning. Its tag linesif its good enough for a film star, then its good for you too to Play with beautyhave conveyedthe same message over the years. It taps into an emotion very close to humanitys basic need

social interaction. The brand has always hired celebrities when they have reached a certainheight rather than using them at the start of their careers. This has helped the customers to relateto their idols on screen.From being a soap for the stars, Lux has recently started positioning itself in such a way that theordinary woman can relate to the brand. The advertisements show not the star, but the actress inthe character of an ordinary girl or woman, which any woman can identify with. This positioninghas helped the brand in striking a chord with the target consumers.

BCG Matrix

BCG matrix method is a portfolio management tool developed by Boston Consulting Group .It isa method based on the product life cycle theory that can be used to know what priorities shouldbe given in the product portfolio of a business unit.To ensure value creation ,a company shouldhave a portfolio of products that contains both high growth products in need of cash inputs andlow growth products that generate a lot of cash.There are 2 dimensions : market share andmarket growth.Placing products in the BCG matrix results in four categories in a portfolio of acompany:

Star : High market growth and high market shareCash cows : Low market growth and high market shareQuestion marks :High market growth and low market shareDogs :Low market growth and low market share

Innovation seems to be the main theme of the Indian soap industry in 2008. With the entry ofITC, the stage is all set for a major tussle between the new entrant and existing players in the Rs6,500-crore branded toilet soaps sector in India. The soap industry is seen to have a marketgrowth rate of about 10%. This shows that industry has a high growth rate. HUL is a marketleader in the industry and its soap Lux enjoys a market share of 17 % in India. So according tothe concept of BCG matrix any product which has high market growth and market share is

8/2/2019 lux. 07 final

29/39

PART 1

classified as STARS. The major objective of products coming in Stars is to maintain their highmarket share. HUL comes up with various variants in LUX quite frequently in order to maintaintheir position.

Ansoff model for Lux:

The Ansoff Growth matrix is a tool that helps businesses decide their product and market growthstrategy. Ansoffs product/market growth matrix suggests that a business attempts to grow

depend on whether it markets new or existing products in new or existing markets.

Current Product New ProductCurrent Market Market Penetration StrategyAttract users : Gold coin offerGold coins hidden in soaps selectively100 gm contained 3-gm gold coin150 gm contained 5-gm gold coin

Product Development StrategyProduct Reformulation: Introduced variants with different ingredientsHoney, chocolate,strawberry, etcProduct feature addition:Lux Crystal shine (with sparkles)Product line extension : addition of small size (Rs 5/-,45 gms)NewMarket Market development StrategyA new variant called Lux Nalangu pindi was introduced in Andhra Pradesh.

8/2/2019 lux. 07 final

30/39

PART 1

Diversification StrategyRelated Diversification : Introduction of body wash

Lux has been in this industry for more than 75 years. It has constantly applied various strategiesto survive and succeed in the industry. Some of the recent ones are mentioned in the abovemodel.

Recommendations

Lux has been following a trend of constant product development and improvement since its

inception. This has always proved to be successful for the brand. Therefore a similar strategy canbe followed in the future: Lux can go for a high end Ayurvedic variant. Lux has been associatedwith beauty and feminine grace till now. In the present day consumers are into naturopathy andbelieve in natural treatments like the Ayurveda. Keeping with this trend, Lux can foray intoAyurvedic variant. HUL already has Hamam soap in this category. But it is a low priced soapwhose target audience is quite different from Lux. This new variant can provide the currentcustomers of Lux with a blend of both class and natural goodness.

Todays children are tomorrows customers. Children have a major share in the decision makingprocess of consumers. Therefore it will be a viable decision to launch Lux Kids Special soap. Bydoing this Lux can catch them young and get a loyal customer base from them. This variant

can be in vibrant colours as opposed to the soft colours used currently. The fragrances can alsobe made more fun and vibrant.

Lux has high penetration in the urban and semi urban areas. However, it has only 19.8%penetration in the rural areas. The rural market has great untapped potential, which HUL has notconcentrated on till now. Consumers are becoming more and more aware and undergoing a surgein disposable income. This huge opportunity can be explored by Lux. HUL already has a strongdistribution channel in almost all regions. What is needed here is a change in the communicationstrategy to reach out to the rural customers. The various channels of communication should bemade more appealing to this rural segment of customers

8/2/2019 lux. 07 final

31/39

PART 1

Part 4

Contents

Companys overview

Product overview

Marketing mix

Swot analysis

Competitor analysis

Recommendation

COMPANYSOVERVIEW

Hindustan Unilever Limited (HUL) is India's largest fast moving consumer goods company

owned by the European company Unilever. The Anglo-Dutchcompany Unilever owns a 52%majority stake.

HUL was formed in 1933 as Lever Brothers India Limited and came into being in 1956 asHindustan Lever Limited through a merger of Lever Brothers, Hindustan Vanaspati Mfg. Co.Ltd. and United Traders Ltd. It is headquartered in Mumbai, Indiaand has employee strength ofover 15,000 employees and contributes to indirect employment of over 52,000 people. Thecompany was renamed in June 2007 as Hindustan Unilever Limited.

Hindustan Unilever's distribution covers over 1 million retail outlets across India directly and itsproducts are available in over 6.3 million outlets in the country, nearly 80% of all retail outlets in

India. The company claims that two out of three Indians use its many home and personal careproducts, food and beverages.

HUL works to create a better future every day and helps people feel good, look good and getmore out of life with brands and services that are good for them and good for others.

With over 35 brands spanning 20 distinct categories such as soaps, detergents, shampoos, skincare, toothpastes, deodorants, cosmetics, tea, coffee, packaged foods, ice cream, and water

8/2/2019 lux. 07 final

32/39

PART 1

purifiers, the Company is a part of the everyday life of millions of consumers across India. Itsportfolio includes leading household brands such as Lux, Lifebuoy, Surf Excel, Rin, Wheel, Fair& Lovely, Ponds, Vaseline, Lakm, Dove, Clinic Plus, Sunsilk, Pepsodent, Closeup, Axe,Brooke Bond, Bru, Knorr, Kissan, Kwality Walls and Pureit.

The Company has over 16,000 employees and has an annual turnover of around Rs.19, 401crores (financial year 2010 - 2011). HUL is a subsidiary of Unilever, one of the worlds leadingsuppliers of fast moving consumer goods with strong local roots in more than 100 countriesacross the globe with annual sales of about 44 billion in 2011. Unilever has about 52%shareholding in HUL

LUX: Overview :

In the country since 1929 and endorsed by popular film stars, Lux is the biggest brand in thesoap category. Lux Toilet Soap, in the popular segment, offers its consumers a range of soapsenriched with the goodness of a variety of nourishing ingredientsAlmond Oil, Orchid Extracts,

Milk Cream, Fruit Extracts, Saffron, Sandalwood Oil and Honey. The Lux premium range offersspecialized skincare to its consumers in the form of Lux International. It also includes Lux BodyWash for superior bathing benefits keeping in step with the changing needs of the Lux consumer

In addition to these variants lux has come up with a few more variants to celebrate its 75 years inbusiness.

The Lux Celebration Range is a set of three exclusive variants- Aromatic Glow and ChocolateSeduction and Lux White Spa body wash containing exotic ingredients, never seen in the Indianmarket before.

Marketing Mix: 4 Ps of LUX:

(A)Product

A product is anything that can be offered to a market to satisfy a need or want.Products that aremarketed include physical goods, services, experiences, events, persons, places, properties,organizations, information and ideas.

Product Classification

Marketers have traditionally classified products on the basis of characteristics: durability,

tangibility, and use.

LUX is a Tangible, Non Durable Good on the basis of this classification.

Prominent Variants:

Lux almond Lux rose

8/2/2019 lux. 07 final

33/39

PART 1

Lux orchidLux fruit

Lux saffron Lux sandalwood

Lux international Lux chocolate

Lux aromatic extractsLux oil and honey glow etc.

Labelling

The LUX Trade Character or Logo is present prominently on the package. A novel metallicsubstrate packaging showcases the ingredients, and a female model is shown on the pack. Alsodiplayed graphically are the key ingredients. The ingredients, place of manufacture have beenlisted. Also listed is the consumer complaint cell address in case of unsatisfactory product.

Packaging

A novel metallic substrate packaging beautifully showcases the ingredients, in case of the soaps.A female model is shown on the pack. The colors are different for different variants such assaffron for the saffron variant, pink for the rose extracts etc.The Bars come in package sizes of100g, 120g, 150 g

2. Price

Competitive prices: Neither high nor low

(c)Promotion

The promotion mix is classified as follows:

* Advertising:

1) Transit

2) Electronic Media

3) Print Media

4) Direct

* Sales Promotion

* Personal Selling

1) Direct Selling

8/2/2019 lux. 07 final

34/39

PART 1

2) Indirect Selling

* Public Relations

* Direct Marketing

Advertisement Analysis

* USP or the common thread through all the advertisements is the Presence of Movie Starsthrough the ages.

* The product has been positioned on the basis of REFERANCE GROUP by using a celebritypopular at that point in time.

* Some amount of attribute positioning by mentioning the various ingredients has also been done

Lux campaigns have wooed millions of people over the decades. Popularly known as the beautysoap of film stars, Lux has been an intimate partner of the brightest stars on the silver screen fordecades. An ode to their beauty, an announcer of their stardom, advertising campaigns on Luxhave featured film stars across the nation, promising their beauty and complexion to ordinarywomen.

With top movie starsfrom Madhubala to Madhuri, from Babita to Karisma and Kareena havingendorsed the goodness of Lux over generations, it was natural that the brand has built equity asthe best beauty soap in India.

From the beginning Lux, by using a leading film star of the time, has fulfilled the consumers

aspirations of using beauty soaps via the rationale if its good enough for a film star, its goodfor me. This later moved into a transformation role of having a bath with Lux, which transportsthe user into a fantasy world of icons, film stars and fairy lands.

Sales Promotion Schemes Used By LUX

* Lux presented 30 gm gold each to the first three winners of the Lux Gold Star offer from Delhi.According to the promotional offer that Lux unveiled in October 2000, a consumer finding a 22-carat gold coin in his or her soap bar got an opportunity to win an additional 30 gm gold. Thefirst 10 callers every week got a 30 gm gold each.

The offercould be availed only on 100 gm and 150 gm packs of Lux soap.

* Lux Star Bano, Aish Karo contest which started on April 16 and went on till July 15 of 2005.All one needed to do was buy a special promotional pack of Lux soap. The pack comes with aspecial scratch card. The 50 lucky winners and their spouses were flown down to Mumbai to livea day like Aishwarya Rai would. They could also be given gift vouchers worth Rs 50,000 fromShoppers' Stop along with an exclusively designed Neeta Lulla sari and a beauty makeover by

8/2/2019 lux. 07 final

35/39

PART 1

Michelle Tung, Aishwarya's preferred designer and stylist. The pice de rsistance was a dinnerdate with Aishwarya Rai herself.

The Lux Star Bano, Aish Karo contest aims to drive the brand propositionMujh mein starjagayefurther. The Lux `Be a Star' promotion is an unique offering through which LUX

brings what stardom feels like to customers.

* Lux is celebrating 75 years of stardom in India and to kick start the celebration, Lux haslaunched the Har Star Lucky Star activity.

Har Star Lucky Star offer is bound to go down in history as the only activity where everyconsumer is a winner! All wrappers of Lux have a star printed inside them. If the consumer findswritten inside the star, any number from 1 to 5, she will get an equivalent discount (in

rupees) on her purchase from her shopkeeper. If the consumer finds 75 years written inside the

star, she will get a years supply of Lux free, courtesy the beauty stars.

(D)Place

Cutting-edge distribution network

HLLs distribution network is recognized as one of its key strengths -- that which helps reach outits products across the length and breadth of this vast country. The need for a strong distributionnetwork is imperative, since HLLs corporate purpose is to meet the everyday needs of peopleeverywhere.

At Hindustan Lever Limited, distribution network is one of the key strengths that help themreach their products across the length and breadth of this vast country. It has 2000+ suppliers and

associates, 45 C&F.A.s, 7,000 stockists and direct coverage in over 1 million retail outlets acrossIndia.

* To meet the ever-changing needs of the consumer, HLL has set up a distribution network thatensures availability of all their products, in all outlets, at all times. This includes, maintainingfavorable trade relations, providing innovative incentives to retailers and organizing demandgeneration activities among a host of other things. HLL boasts of placing a product across thecountry in less than 72 hrs.

* The first phase of the HLL distribution network had wholesalers placing bulk orders directlywith the company. Large retailers also placed direct orders, which comprised almost 30 per cent

of the total orders collected.

* Today, the goods are transferred from the factory to the company warehouses (C&F.Agodowns) and are sent to the distributor from there on a daily basis. From the distributor, thestock reaches the market through daily sales. Typically, these include the salesman registeringthe order of a retail outlet and delivering the goods the next day.

8/2/2019 lux. 07 final

36/39

PART 1

* Recently HLL has changed its traditional way distribution and came out with a new strategy ofdistribution. Its because of the change in buying pattern of the consumer due to more disposableincome. There are different channels of distribution like Modern Trade, which covers all chainsof super markets like Food World, who get the stocks directly from the company. Wholesalersand second leg of big retail outlets called Super Value stores come under the surveillance of the

distributor along with the mass retail outlets. There is also this new concept in the HLLdistribution channel called Kiosk. Kiosk is a small shop that sells only sachets and low priceditems (below Rs.10/-). Kiosk also does not come under the surveillance of the distributor.

* In addition to the ongoing commitment to the traditional grocery trade, HLL is building aspecial relationship with the small but fast emerging modern trade. HLL's scale enables it toprovide superior customer service including daily servicing, improving their range availabilitywhilst reducing inventories. HLL is using the opportunity of interfacing more directly withconsumers in this retail environment through specially designed communication and promotions.This is building traffic into the stores while yielding high growth for the business.

* An IT-powered system has been implemented to supply stocks to redistribution stockists on acontinuous replenishment basis. The objective is to catalyse HLLs growth by ensuring that theright product is available at the right place in right quantities, in the most cost-effective manner.For this, stockists have been connected with the company through an Internet-based network,called RSNet, for online interaction on orders, dispatches, information sharing and monitoring.RS Net covers about 80% of the company's turnover. Today, the sales system gets to know everyday what HLL stockists have sold to almost a million outlets across the country. RS Net is partof Project Leap, HLL's end-to-end supply chain, which also includes a back-end systemconnecting suppliers, all company sites and stretching right Upto stockists. RS Net has come as aforce multiplier for HLL Way, the company's action-plan to maximize the number of outletsreached and to achieve leadership in every outlet, by unshackling the field force to solely focuson secondary sales from the stockists to retailers and market activation. HLL Way has also led toimplementing best practices in customer management and common norms and processes acrossthe company. Powered by the IT tools it has further improved customer service, while ensuringsuperior availability and impactful visibility at retail points.

* For rural India, HLL has established a single distribution channel by consolidating categories.In a significant move, with long-term benefits, HLL has mounted an initiative, ProjectStreamline. As a result, the distribution network directly covers about 50,000 villages, reachingabout 250 million consumers.

* Distribution will acquire a further edge with Project Shakti, HLL's partnership with Self HelpGroups of rural women. The vision is to reach over 100,000 villages, thereby touching about 100million consumers. The SHGs have chosen to adopt distribution of HLL's products as a businessventure, armed with training from HLL and support from government agencies concerned andNGOs.

SWOT ANALYSIS

8/2/2019 lux. 07 final

37/39

PART 1

STRENGTHS1.Strong Market Research (door to door sampling is done once a year in Urbanand Rural areas)2.Many variants (Almond Oil, Orchid Extracts, Milk Cream, Fruit Extracts,Saffron, Sandalwood Oil, and Honey to name a few)3.Strong sales and distribution networkbacked by HLL4.Strong brand image5.Positioning focuses on the attractive beautysegment6.Dynamically continuous innovation of the product and brand rejuvenationnew

variants (Aromatic Glow and Chocolate Seduction and Lux White Spa body wash) andinnovative promotions (22 carat gold coin promotionChance Hai)7.Perceived to have highvalue for money (strong brand promotion but relatively lower price which is a winningcombination in the popular segment)8.Though it is in popular segment, it is having massappeal/market presence across all segments (15% of the soap market captured by Lux (sales /volume)9.Unique advantage of having access to resources and assets ofHLLOPPORTUNITIES1.Soap industry growing by 4% in India2.Beauty segments