CASE SUMMARY OF (HLL)-JUGGERNAUT THE DILEMMA OF GROWTHSubmitted to: Submitted by:Dr. D.D.Swain Abhinav AnandMarketing Management- 2 BHU-001 PGDM2011 INTERNATIONAL MANAGEMENT INSTITUTE BHUBANESWAR
INTRODUCTION:Hindustan Lever Limited (HLL) is India’s largest fast moving consumer goods company, withleadership in home and personal care products, foods and beverages and specially chemicals. Ithas 40 factories across India. The vision that inspires HLL’s 36,000 employees including 1300managers is to “meet everyday needs of people everywhere- to anticipate the aspirations of ourconsumers and customers and to respond creatively and competitively with branded products andservices which raise the equity of life”.PRODUCTS:The company is having 110 brands having different products line which categorizes of 1)Home&Personal Care which constitutes of successful products such as Pepsodent, Fair&Lovely, Axeetc.2)Soaps and Detergents which has brands like Lifebuoy,Wheel,Lux etc.3)Foods Beveragesconsisting of Kwality Ice creams 4)Beverages having Brands like Lipton Taaza,Brooke Bondetc.5)Popular Foods-Annapurna 6)Culinary-Kissan 7)Oils&Fats line has Dalda as its Brand.ISSUES1. There has been slowdown in the demand of FMCG sector because of price reduction which isestimated to remain for a while.2. Hll inspite of being a market leader is facing stiff competition from focused players indifferent product segment.e.g. Britannia has been gaining market share with great performanceof its Tiger biscuits.Even in the company’s prime growth driver personal care product are also witnessing slowergrowth due to high level competition from companies like Godrej,Tata Tea,Cavin Kare whichare gaining market share at HLL’S expense in their respective product categories.3) This competition in personal care product is very likely to affect Topline and the Bottomlineas this sector has high margin products.
SWOT ANALYSIS: Strength Hindustan Lever Research Centre has greatly contributed in HLL’s success. The focus on research gives HLL an edge over competitors by coming up with innovative products and process. HLL has always stressed on constant technology up gradation. The company has always focused on acquiring knowledge-based software. Massive and efficient distribution system. HLL has a strong brand equity, which provides it a good market share. It has made a positive motivational climate, which encourages the employees to associate with it. Weaknesses: Higher price of some product of HLL comparing to same product of other company, though the rate of raw materials are same. Supply procedure is much complex. Opportunities: Taking e-initiatives to target the consumers who are from the semi-urban areas. Television is now one of the cheapest sources of entertainment. Cable TV as a mass medium has already become popular. So, advertisement in Cable channels makes the attention on the products to the customers of urban areas. Rural Consumers insist buying brand rather than the products. So, this is easy for them to get the consumers from rural areas. HLL is one of the best companies in India exporting FMGC products. Threats: Price rate of some national and multi-national companies is lower than HLL. Some competitors give new attractive offers for the consumers. Companies like Godrej, Nirma, and Tata Tea etc. are gaining market share at HLL’s expenses in their respective product categories. Dabur had given competition through its herbal positioning.
MARKETING STRATEGIES: 1. Price: HLL is cutting down the cost of some of its products, because of the competitive market. The market price of some HLL products was higher than the same products from other companies.So, the customer were choosing the products of other company for their daily use. So, HLL has cut down their price for came back in market. 2. Promote: It recently introduced popular foods like wheat flour and edible salt under the Kissan Annapurna brand name to change the consumers’ habits by making them give more preference to processed, hygienic, healthy products. HLL has launched Savlon and Liril Rainfresh, which enable HLL to further consolidate its position in the concentrates segment. 3. Products: Re-launched Surf-Excel with a new and improved formulation, which also enable HLL to further consolidate its position in the concentrates segment. HLL plans to expand the product mix at its exclusive Kwality Walls ice-cream parlors by including confectionary and other offering. The merger of HLL and Pond’s results in increased revenues for HLL. 4. Place: HLL is now taking to e-commerce in a big way to get the market share of semi- urban areas. Taking the help of Television advertisement to get the attention of the consumer from urban areas. In the area of business connectivity, HLL plans to create an extranet linking to link suppliers, factories, and purchasers.
HLL is already working in the area of consumer connectivity through the Pond’s website, Hello Hindustan Mera Hindustan initiatives in the detergent, and event like Close Up Antakshari on the Net, which enable the consumer to try out various beauty products on screen, before buying. RECOMMEENDATION: The company should take up new techniques to lower the price of its products so that it can compete with its competitors who have relatively low price but maintains the same quality as that of HLL. Concentrate on value for money for the customers. Should reconstruct the product portfolio to counter the impending slowdown. Should discard the and come up with various products in the herbal platform as health conscious consumers today is trying to give up chemicals and embrace herbal products.