Vizag Case Solution

VIZAG CASE SOLUTION

Submitted By:

Divyang Sinha P36112

Gaurav Sharma P36113

Himanshu Gupta P36116

Sanjeev Kumar P35177

Sukriti Dang P36165

Introduction

Ariel detergent powder launch by P&G in the test market of Vizag triggered intense marketing war in detergent market of India. At this point of time, major players in detergent market Hindustan Lever (HLL) and Nirma had market share of 40% and 30% respectively, with a market size well over us $ 1,000,000,000.

In response to Ariel the first concentrate or compact detergent powder to be launched in India, HLL launched Triple Power Rin (TPR) a competing, less expensive concentrate NSD powder.

HLL intensified market research by setting up a consumer panel in Vizag soon after Ariel’s test launch.

Answers to the questions raised are as follows:

How significant is the demand for concentrates?

From Exhibit 3, we can see that Ariel and Triple Power Rin (Concentrates) gain market share in volume from 7.2% to 10.6%, i.e. an increase of 47.22%.

What was the impact of concentrates on the demand for detergent powder and detergent bar?

From Exhibit 8, we can see that consumption of powder has decreased from 1116 gm in Nov’90 to 1007 gm in Mar’91 to 1035 gram in Jun’91 which shows that concentrate has decreased the volume sale of detergent powder.

From Exhibit 10, We can see that the number of people using only powder (detergent + concentrate) has increased while decreasing by the same proportion in the number of people using Bar along with detergent powder (as there is no consumer using only bar), which shows that with the increase in the number of people using concentrate, consumption of bar got decreased.

To what extent would it change wash habits?

As explicit from Exhibit 10, people switching to concentrates started using fewer bars along with detergent powders as there is an increase (an increase of 80%) in the number of people who were using only powder which shows that people were more satisfied with the use of only concentrate powders.

How costs effective are concentrate powder?

From Exhibit 11, and assuming that both wash baskets (Ariel buyer vs Surf Buyer) give the same quantity & quality of cloth washing, the difference in Wash basket (gm) is considered to be there because concentrate gives better washing quality in less quantity. Also, there is an increase in the population using only concentrates and it might get increased with time, i.e. people leaving detergent bars usage along with powders. Keeping this in mind, we can safely conclude that concentrates are more cost effective.