Project Shakti

Introduction
Hindustan Unilever Limited (HUL) to tap this
market conceived of Project Shakti.
This project was started in 2001 with the
aim of increasing the companys rural
distribution reach as well as providing rural
women
with
income-generating
opportunities.
This is a case where the social goals are
helping achieve business goals.
4,00,000 VILLAGES

States covered by Project

shakti

HOW IT WORKS?
Villages with a population of about 2000-3000 are
selected.
Personnel from HUL approach SHGs.
Selection of the Shakti Amma.
HUL vouches for Shakti Ammas with banks from
credit.
One Shakti entrepreneur is appointed for one village
& villages that are about 2 kilometres apart from her
village.
The
Shakti dealer places initial orders worth
Rs.15000(principal customer of HUL
The Shakti dealer organizes a Shakti
village(display of products & free gifts)

Day in the

 The recruitment of a Shakti Entrepreneur or

Shakti Amma (SA) begins with the executives of
HUL identifying the uncovered village.
The representative of the company meets the
panchayat and the village head and identify the
woman who they believe will be suitable as a
SA.
After training she is asked to put up Rs 20,000
as investment which is used to buy products for
selling. The products are then sold door-to-door
or through petty shops at home.
On an average a Shakti Amma makes a 10%
margin on the products she sells.

PRICING AND PACKAGING

Rural consumers are price sensitive

Sachets and small packs of premium products.
Price doesnt exceed Rs.5 per sachet.
Lux at Rs.5,
Lifebuoy at Rs.2,
Surf Excel sachet at Rs.1.50,
Pond's Talc at Rs.5,
Pepsodent toothpaste at Rs. 5,
Fair & Lovely Skin Cream at Rs.5,
Pond's Cold Cream at Rs.5,
Brooke Bond Taaza tea at Rs.5.

SOME OF THE PRODUCTS SOLD

THROUGH PROJECT SHAKTI

AT
RS.5

AT
RS.5

AT
RS.2

AT
RS.5

AT
RS.5

AT
RS.5

AT
RS.1.5
0

AT
RS.6

Distribution
It is the combination of the 3 ways:
Door to door selling (11% margin on
sales)
Sells from own home (11% margin on
sales)
Retailers (3% margin)
averages sales :
Rs. 10,000 - Rs. 15,000/month,
profit - Rs.1,000 per month

HLLs approach to rural distribution

Accessibility

Indirect
Coverage

Direct
Coverage

Streamline

Turnover per market

Direct coverage

Factory
Trade

Depot

Stockiest / Distributor

Indirect Coverage
Village 3

Village 4
Stockist

Village 2

Village 5
Village 1

Streamline
Star seller

Star seller

Distributor

Star seller

The role of micro-finance

The self-help group
Grameen Bank: mutual thrift societies of village women
A rapidly spreading movement: 6 million groups in India
70% of rural households in AP
A micro-finance revolution
8 million families have received micro-credit
76% of micro-credit recipients have crossed the
poverty line
95% of micro-credit recipients are women
Effectiveness depends on opportunities for microenterprise

Future plans
Project Shakti plans to extend to the
states of West Bengal, Punjab and
Rajasthan.
Partnership with other noncompetitor companies to sell their
products through the Shakti network.
Nippo, TVS Motor for mopeds,
insurance companies for LIC policies.

Issues
Low margins .
Difficulty in acquiring
finance
transportation
Low disposable income
(dependence on monsoon)

Profile of Indian rural

Economy
Sector
Agriculture
Manufacturing
Service
Trade
Others

%
78.0
7.1
5.8
4.4
4.3

Why all these program

To take people aware
To increase the consumption.
To increase the income.
To increase behavior in
Awareness & living standard
Lifestyle
Self consciousness.

WHY SHAKTI???

It was soon felt that HUL's sales and

distribution system which had protected it
from competitors would be soon replicated
by its rivals and to maintain its edge, the
company had to increase its reach beyond
the urban markets
Carrying and forwarding agents(CFA)
more than 70% of India's population lived
in villages and made a big market for the
FMCG industry

BENEFITS

Earnings about 7%, after 3% goes

towards principal and interest
Improves her per-capita income by
about 50% to 100%
100,000 entrepreneurs by 2010

 With lack of TV or Radio medium

Promotion through demonstration of
HUL products at the Haat Bazaar.
Star sellers made up for this lack of
audio-visual brand advertising.

 Differential pricing for rural

costumers purchasing from SHG
Two different channels of same
company competing on PRICE.
Undermining local retailers
Negligence of flooding of counterfeit
products into market place

PROGRAMMES UNDERTAKEN
SHAKTI VANI
SHAKTI ENTREPRENEUR
iSHAKTI COMMUNITY PORTAL

Shakti Vani

Social communication anchored on brands

health and hygiene
womens empowerment

Village women are recruited as Vanis and trained

to communicate
Vani audience: key opinion leaders, schools, SHG
meetings, other village gatherings
Specially designed communication material
easy-to-carry kit: flip-charts, leave-behind posters,
banners
content developed after in-depth understanding of
local context

Hand-wash demo in schools

Shakti Activities

Free Health Camps in Shakti Village

Free Dental Camps in Shakti

Villages

i - Shakti
In 2010, they started i-Shakti an ITenabled community portal across the state
of Andhra Pradesh. i-Shakti is designed to
give rural people access to information via a
network of village kiosks containing
internet
linked
computers
run
by
entrepreneurs.
Villagers can access free content, developed
in their local language, or email questions
on a wide range of topics, including Unilever
products, health and hygiene, agriculture,
education, finance and employment.
The aim is to have 3000 i-Shakti kiosks on
stream by the end of 2010 covering 9500
villages and 18m people.

iShakti Contd
Rural community portal that creates access to
information
Villagers can register as users and surf content
areas:
Agriculture, health, veterinary services, education,
employment opportunities, education, personal
grooming, entertainment, games

All content backed by local language voice-over

On all content areas, users can pose queries
1,000 kiosks in AP, partnership with government

Appearance of ishakti kiosks

SHAKTI ENTREPRENEUR
PROGRAMME
It helps women in rural India set up small
businesses
as
direct-to-consumer
retailers.
The scheme equips women with business
skills and a way out of poverty as well as
creating a crucial new distribution
channel for Unilever products in the large
and fast-growing global market of lowspending consumers.
By 2010 the Shakti network aims to have
reached 600 million consumers.

Objective
The Shakti entrepreneur program creates
livelihood opportunities for underprivileged rural
women.
The Shakti Vani program works to improve the
quality of life in rural India, by spreading
awareness of best practices in health and
hygiene.
They are also studying the consumption habits
of the rural people.

Other Activities
To improve the business skills of the SHG women,
extensive training programmes are being held.
Workshops have already covered a large number of
Shakti Entrepreneurs in Andhra Pradesh,
Karnataka, Gujarat, Madhya Pradesh, Uttar Pradesh,
Tamilnadu, Chattisgarh and Orissa.
As part of their training programme, all HUL
Management Trainees spend about 4 weeks on
Project Shakti in rural areas

 The factories that HUL continued establishing in

less-developed regions of the country have been
engaged in developing rural market in adjacent
villages.
These factory-centered activities mainly focus
on training farmers, animal husbandry,
generating alternative income, health & hygiene
and infrastructure development.

Participated States

Andhra Pradesh
Karnataka
Gujarat
Chattisgarh
Maharashtra
Orissa
Punjab
Rajasthan
Tamilnadu
Uttar Pradesh
West Bengal
Bihar
Haryana
Jharkhand

Vision 2010

100,000

500,000

600 million

Entrepreneurs

villages

Consumers

Shakti shall reach every home in every village,

create sustainable livelihood opportunities, and
enhance the quality of life in rural India
Now SHAKTI has been extended 80,000 villages
in 15 states with 45,000 women entrepreneurs &

CONCLUSION
Project Shakti is enabling families to
live with dignity and in better health
& hygiene, education of the children
and an overall betterment in living
standards.
it creates a win-win partnership
between HUL and the rural
consumers for mutual benefit and
growth.