The document discusses strategies employed by India's largest FMCG company, HUL, to penetrate rural markets with a focus on women empowerment through Shakti entrepreneurs and low-cost supply chain innovations. It highlights the challenges faced, including competition and market saturation, while emphasizing the economic and social value generated through the initiative. Key initiatives include training programs, micro-finance support, and local influencer engagement to establish brand presence in over 500,000 villages.

1. Marketing FMCG to the Rural Customers
Presented by:
Group 15
Gangotri V Naik (1311017)
Makesh Kumar M (1311028)
Priyadarshini K (1311035)
Raja S K (1311040)
Anurag Kumar (1311078)

2. Company
• India's Largest FMCG Company
• Subsidiary of Unilever; holds 52% equity
• Unilever is world's largest FMCG Company
• Worldwide revenue of US$ 55 billion
• Annual Turnover: INR 110 billion
Indian Market
• World’s 2nd largest market after China
• 2 out of 3 Indians: HUL user
• Rural Population: 750 million
• Below Poverty Line: 250 million
Traditional Approach: Product Category
• 100+ brands
• Each profit centre- own sales force and stockists
• Regional offices for product categories
• Not Appropriate for small markets
Modern Trade: Channel Approach
• Rise of self-service stores in urban parts
• Sales force- Customized to suit channel
• ASM negotiating on part of all HUL categories

3. Manufacturer
Depot / CFA
Redistribution Stockists
Retail Outlets
Wholesalers
>= 1 per state
>= 1 per town
Profit Center Based Sales Teams
(70%)
Modern
Trade
(10%)
Rural
Markets
(20%)
Rural Distributors and
Star Seller

4. Manufacturer
Depot / CFA
Rural Distributors
Rural Outlets/ consumers
SHG / Shakti
Entrepreneur
MACTS

5. • Explore the unexplored market – Edge over
competition
• Improving effectiveness through SHGs, NGOs,
microfinance and Government support
• Operates in inaccessible markets with low market
potential
First of its kind rural initiative with a direct reach
• Brand ambassador in rural areas with one to one
communication for Shakti
• Made effective use of SHGs through MACTS
Build brand through local influences
• RSP’s Impart training & knowledge to women –
makes them innovative& entrepreneurial
• Vani – a communication initiative for primary
awareness of best practices
Focus on Women
Potential
Accessibility

6. Positives
• Opportunity for efficient low cost supply
chain
• Profit initiative with Social Impact
• Sustainable Livelihood for unprivileged
rural women
• More margins for Shakti entrepreneur
• Low unit packets – sachet model
• iShakti enabled internet connection and
technology penetration
• Higher costs of training
• Packaging price of smaller sachets adds to
cost per unit
• Shakti entrepreneurs who drop out will
become financially strained
• Dropping out also adds to the costs of HUL
• Destroying local initiatives, multinational
tapping into rural markets
• Loans taken lock in the people with HUL
Negatives

7. Existing Markets
• Growing Competition
• Price wars
• Entry of Local firms and MNCs
• Saturated Markets
• Exhausted available options
– Product Innovation
– Efficiency
– Trimmed to power brands
• Competitive advantage?
• 500 million in 500000 villages
• Huge potential Vs Need for new
markets
• Lack of
– Access/ reach
– Advertising media
• Huge scattered market
• Low per capita consumption
• Existing stockist structure?
Unexplored Markets

8. Reach for HUL, Brand Image
One-one influencers
Demand generation
Opportunity to innovate – small
sachets
Shakti Entrepreneurs
Capable of running a
business/ i Shakti /
Vani Sakti
Job training, health
literacy/ Social
awareness,
Technology, soft skills
Bank Loans, Micro
Finance – enabled by
HUL
Reduction in Poverty,
Improvements in living
standards/ per capita income,
Women empowerment

9. • 10% of HLL’s rural turnover
• Ease of switching – through
Low Unit price Packs(LUPs)
• Income of 500-700 INR for
about 12000 women
• Promoted micro-finance
with investment opportunity
• New life for rural women
• Learn while you earn
• Intellectual capability
• Creating a network
• Passing margins
• Credit to patrons
• Exposure to computers and
internet / information
• Better health and hygiene
practices
• Access to Inaccessible
market
• 500 million rural people
• When market was mature
source of increased revenue
• Local influencers and one to
one endorsers
• Improved effectiveness and
Efficiency
• Direct reach to final
customers
Economic Value Social Value HUL’s Bottom Line

10. Government regulations &
support
Language Barriers
Cultural barriers
suppressed women
Exploitative perception
about MNCs
Absence of self help groups Acceptance of HUL
against traditional products
Availability of financing
options
Local/State terrorism

11. Expansion Costs
Bearing the
promotional and
training costs for
human resources
Increasing the
confidence of women
in rural India
Preserving the social
motive while
expansion
Increasing the effectiveness and
efficiency of the existing Shakti
entrepreneur

12. Convince successful brand managers with effectiveness and efficiency of Shakti
HLL representative visits consumer home with demos/ trials
Establish a standardized training platform which is replicable across different states based on language and culture
Streamline iShaktias a CSR initiative with government and explore it as a medium for data collection
Help with extending credits and passing on margins to customers
Promote the concept through Local Opinion leaders in areas where acceptability is low
Use conventional methods of communication like puppet shows/ dramas to convey success of Women Entrepreneurs
Involve the family members in order to overcome entry level gender constraints
Use mobile trends, SMS and calls for training