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Case Study

PGDM 2009-
11
ISSUES
1.Dabur –The Brand What
Branding Strategy?
2.Product Offerings
3.Brand Equity (Strength,
Analysis)
4.Restructuring (Why and How-
the Approach?)
5.SWOT (What)?
6.Marketing Mix (What)?
SOME FACTS
•Dabur India is the 4th Largest FMCG Company in
India
•Legacy of over 100 years
•Strategic Business Units in Health care, Personal
care and Food products
•Dabur has a turnover of Rs.1899.57 crore with
powerful brands like Dabur Amla, Dabur
Chyawanprash, Real, Vatika and Hajmola
•Bottom Line Driven Company
•Product marketed in over 50 countries
•Leader in Herbal Digestives with 90% market
share
•Established : 1884
•Founder : Dr. S K Burman
•Basic Motive : Manufacture of Ayurvedic
Drugs
•Achieved : By setting up manufacturing units
and setting up Research and
Development Labs

•Expanded its product line in the mid 1900’s by


launching Dabur Hair Oil and Chyawanprash
•Added Oral Care Products in the 1970’s
•Shifted base from Kolkata to New Delhi in 1972
•Launched Hajmola tablet in 1978
•In 2004,restructured its portfolio and
structured itself into three main SBU’s
•Has 5 power brands under its portfolio
•Entered new markets like the Juice segment,
branded packaged soups segment
•Developed its Oral Care Market
•Increasing its geographical spread
•Aims at doubling its revenue and profit by
the end of 2009-2010
abur India Ltd is the largest Indian FMCG and “Ayurved

1.Dabur
1.Dabur Finance.
2.Dabur
2.Dabur Nepal Pvt Ltd.
3.Dabur
3.Dabur Egypt Ltd.
4.Dabur
4.Dabur Overseas Ltd.
5.Dabur
5.Dabur International Ltd.
1 . Health care ,
2 . Food products ,
Produ 3 . Natural gums &
cts allied
chemicals ,
Group 4 . Pharma , and
s 5 . Veterinary
products .
1.Dabur Amla,
2.Dabur,
3.Chyawanaprash,
Leading 4.Vatika,
Brands 5.Hajmola,
6.Lal Dant Manjan,
7.Pudin Hara,
8.Real range of fruit
juices.
PERSONAL CARE SEGMENT
•Hair Care Oil and Shampoo (VATIKA)
•Skin Care (FAIRENESS FACE PACK)
•Oral Care (DABUR RED GEL AND
•TOOTHPASTE

FOODS PRODUCT RANGE


•Juice ( REAL/ REAL ACTIV)
•Dabur Honey
•Hommade (Packaged Soups)

AYURVEDIC HEALTH PRODUCTS


•Digestive Segment (HAJMOLA)
•Dabur Chyawanprash
•Pudin Hara

AYURVEDIC DRUGS

HARMACEUTICALS
•Different brands have its own marketing and advertising team
•Different brands had different promotions
•Utilized the popularity of Indian films in the domestic and global
markets to promote its brands
•Undertook the most advertising campaign with Mr. Bachchan endorsing
Dabur brands
•Signed cricketer Virendar Sehwag and his wife for selected Oral, Hair
and Healthcare product
•Adopted the INTEGRATED MARKETING COMMUNICATION programme in 2003 to
increase its market share
•Targeted the Institutional market which included hotels and airlines
Partnered with Institutional clients to provide value added
services
•Held various contests
•Training sessions and workshops for food and beverage professionals
•Tie-up with Discovery Channel
BRAND EQUITY

The Brand Equity of Dabur can be judged by the model

BRAND ASSET VALUATOR - Four Key components :


1.Differentiation
2.Relevance
3.Esteem
4.Knowledge
As Dabur is a well- established brand all the four
components are high

HERBAL has been Dabur’s Brand equity since centuries


How Dabur Builds its Brand Equity
Identities making up the brand

•Choice of its
a.logo,
b.symbol,
c.slogan,
d.packaging

Marketing Activities

Associations of the brand


Why Restructuring ?

Problems
1 . Diversified into too many groups
•Lower Sales and Profits
2 . Image
•Ayurvedic Company
3 . Association
•Particular Age Group - 35 Plus
Age
Restructuring Process
1.Cut down on all its low Contribution Brand
2.Position(ed) itself as an Herbal specialist
in the FMCG sector
3.Set Higher Targets
4.Identify/ied Growth Drivers
5.Filling up the gaps in Oral Care as wellas
Hair Care market
6.Set itself a new Brand Strategy
7.Enter(ed) new potential areas and targeted
the youth as well school children
Branding Strategy
Changed its branding strategy by moving from
the Umbrella Strategy to the Key brand
Strategy. Dabur has categorized itself
into five power brands

1.Dabur (HEALTHCARE)
2.Vatika (HAIR CARE)
3.Anmol (PERSONAL CARE)
4.Real ( JUICES)
5.Hajmola (DIGESTIVE SUPPLEMENTS
PRODUCT LINE EXTENSION
In the JUICES range Dabur introduced :
Coolers (Low fruit Content)
Real ( High fruit pulp Content)
Real ACTIVE (Health Conscious Youth)
Real Juniors (for the children below 6
years of age)
Real School Pack
Why these Strategies
Line Extension Strategy was adopted by Dabur because:

1.It could attract different target audience


2.Could renew Interest and liking for the brand by introducing new
variants
3.It could increase its market share
4.Diversify without much risk
5.Moved from its Core strategy and hence could give customers
something better and different
6.It could attract different target audience
7.Could renew Interest and liking for the brand by introducing new
variants
8.It could increase its market share
9.Diversify without much risk
10.Moved from its Core strategy and hence could give customers
something better and different
Dabur through its diversified brands has tapped
various target segments like the :

1 . Youth
2 . Health Conscious People
3 . School Children
4 . Mothers
5 . Existing Old age group
PRODUCT

Products have been divided into 5 power brands

Quality : High
Sizes : Available in different sizes
Design : Available in Tetra Pack, Bottles, Sachets

Sr . No Brand Type

1. Dabur Healthcare (Chyawanprash)


2. Vatika Herbal Beauty Brand
3. Anmol Personal Care Market
4. Real Foods
5. Hajmola Digestive
PRICE

As, Dabur had different sub-categories it


came out with variable pricing to reach each
and every target segment

E.g. : One- litre bottle of Cooler (juice)


was priced at Rs.50

• Selective Price Reduction to increase


Demand
• Introduction of Smaller packs at Rs.5
• Came out with Rs.1 sachet of Vatika
Shampoo to increase market share
• Cutting Price to stand out against
competition
PLACE

Dabur constantly kept on increasing its


geographic spread to increase its sales
revenues

•Entered the South Indian Market


•Expanding in the International Market
•Presence in over 50 countries
•Subsidiaries established in Nepal, Nigeria,
Bangladesh and Pakistan

Focus Areas : Asia Pacific, Afghanistan,


Russia and other CIS countries
PROMOTIONS

•Different brands have its own marketing and advertising team


•Different brands had different promotions
•Utilized the popularity of Indian films in the domestic and global
markets to promote its brands
•Undertook the most advertising campaign with Mr. Bachchan
endorsing Dabur brands
•Signed cricketer Virendar Sehwag and his wife for selected Oral,
Hair and Healthcare product.
•Adopted the INTEGRATED MARKETING COMMUNICATION programme in 2003
to increase its market share
•Targeted the Institutional market which included hotels and
airlines
•Partnered with Institutional clients to provide value added
services
•Held various contests
•Training sessions and workshops for food and beverage
professionals
•Tie-up with Discovery Channel
STRENGTHS WEAKNESSES

1 . Century Old Company 1 . Profitability is uneven across


2 . Established Brand product line
3 . Ayurvedic / herbal Product line
4 . Leader in Herbal Digestives
where the product has 90 % of
the market share
5 . Innovativeness in Promotions

OPPORTUNITIES THREATS

1 . Extend Vatika brand to new 1 . Competition in the FMCG sector


categories like Skin Care and from well established names
body wash segments 2 . Other fields of medicine -
2 . Launch several OTC brands Allopathic and Homeopathic
3 . Southern India Market 3 . Markets where Herbal products
4 . Exploring new geographical are not recognised
areas - local as well global
5 . Oral Care Segment
6 . Launching new Products like
Hair oils , Herbal and Gel
Toothpastes etc
THANK YOU !!!
Strategic Management
Process
PGDM 2009-11
WHAT IS “ STRATEGY ” ?

1 . Consists of competitive moves &


business approaches to produce
successful performance
2.
3 . Management ’ s “ game plan ” for

•Running the business
•Strengthening firm ’ s competitive
position
•Satisfying customers
•Achieving performance targets
THINKING STRATEGICALLY
1 . WHERE ARE WE NOW?

2 . WHERE DO WE WANT TO
GO?
THREE BIG STRATEGIC •Business
QUESTIONS positions
management wants
to stake out
•FINANCIAL
outcomes to
achieve
•STRATEGIC
outcomes to
achieve
3 . HOW WILL WE GET
THERE?
FIVE TASKS OF STRATEGIC MANAGEMENT

1 Defining business , stating a


mission , & forming a
strategic vision
2 Setting measurable
objectives
TAS
KS 3 Crafting a strategy to
achieve objectives
4
Implementing & executing strategy
Evaluating performance ,
5 reviewing new developments ,
& initiating corrective
adjustments
FIRST TASK

DEVELOPING A
VISION
&
MISSION
DEVELOPING A VISION & MISSION

qBegins with thinking strategically


•About firm’s future makeup
•Forming vision of firm’s future in 5-10
years
q
qTask is to

1.Inject SENSE OF PURPOSE into firm’s
activities
2.Provide LONG - TERM DIRECTION
3.Give firm STRONG IDENTITY
4.Decide “ WHO we are, WHAT we do, & WHERE we
are headed”
Mission

ѲAn organization ’ s MISSION


Ѳ
Ø reflects management’s vision of what
firm seeks to do & become
Ø
Ø provides clear view of what firm is
trying to accomplish for its
customers
Ø
Ø indicates intent to stake out a
particular business position
Strategic Visions - Specific
Questions
• What business are we in now?
• What business do we want to be
in?
• What will our customers want in
future?
• What are expectations of our
stakeholders?
• Who will be our future
competitors? suppliers? Partners?
• What should our competitive scope
be?
• How will technology impact our
Why a Shared Vision Matters
qA strategic vision widely shared
among all employees functions
similar to how a magnet aligns iron
filings
q
Ø when all employees are committed
to firm ’ s long - term direction ,
optimum choices on business
decisions are more likely
Ø individuals & teams know intent
of firm ’ s strategic vision
Ø daily execution of strategy is
improved
Mission Statements
To be the
world’s best
EASTMAN KODAK

in The mission is to
chemicals AMERICAN RED CROSS improve the
and quality of human
electronic life; to enhance To be America’s best
imaging. self-reliance and quick service
concern for restaurant chain. We
others; and to will provide each
guest great tasting,

LONG JOHN
help people

SILVER ’ S
avoid, prepare healthful, reasonably
for, and cope priced fish, seafood,
with emergencies. and chicken in a
fast, friendly manner
on every visit.
Why Bother to Define “ Who ,” “ What ,” &
“Where?

1 . Helps managers avoid trap of



•Trying to move in too many directions
•Being so confused about firm’s direction
that effective actions are NOT taken to
move in ANY direction
2 . To successfully chart firm ’ s future ,
managers must
•Know where firm is now
•Have view of where it ought to be headed
•Recognize time to shift to a new direction
SECOND TASK

SETTING
OBJECTIVES
1 . Purpose of setting OBJECTIVES is to
2.
•Convert mission into performance targets
•Create yardsticks to track performance
•Establish performance goals requiring stretch
•Push firm to be inventive, intentional, focused

2.Setting CHALLENGING but ACHIEVABLE objectives guards against


3.
•Complacency
•Drift
•Internal confusion
•Status quo performance

3 . Two Types of Objectives Needed


4.
•Financial Objectives : Outcomes that relate to improving
firm’s financial performance
•Strategic Objectives : Outcomes that will result in
greater competitiveness & stronger long-term market
position
Types of Objectives

1 . Financial Objectives
•Increase earnings growth from 10 to 15% per year
•Boost return on equity investment from 15 to 20%
•Achieve & maintain a AA bond rating
2 . Strategic Objectives
•Up firm’s market share from 18 to 22%
•Overtake rivals on quality or customer service
•Attain lower overall costs than rivals
•Become leader in new product introductions
•Achieve technological superiority
CORPORATE OBJECTIVES
Nike : •Protect & improve Nike’s position as the number one
athletic brand in America.
•Build a strong momentum in growing fitness market.

•Intensify the company’s effort to develop products

that women need and want.


•Explore the market for products specifically

designed for the requirements of maturing Americans.


•Direct & manage the company’s international business

as it continues to develop.
•Continue the drive for increased margins through

proper inventory management and fewer, better


products.
Strategic Corporate Financial
Objectives
Ford : To satisfy our customers by providing
Motor quality cars & trucks, developing new
Company products, reducing time it takes to bring
new vehicles to market, improving
efficiency of all our plants & processes,
& building on our teamwork with employees,
unions, dealers, & suppliers.
Atlas : To become a low-cost, medium-size gold
Corporatio producer, producing in excess of 125,000
n ounces of gold a year and building gold
reserves of 1,500,000
THIRD TASK

CRAFTING
A
STRATEGY
Strategy Making Concerns Strategy as Planned
and
HOW to Reactive to Changing
Circumstances
1.Achieve desired
strategic & financial Actual Strategy
objectives
2.Out-compete rivals & win
a competitive advantage
3.Respond to changing Planned
industry & competitive
conditions Strategy
4.Defend against threats
to firm’s well-being
5.Grow the business Adaptive Reaction
Crafting A Strategy

Objectives A firm ’ s actual


strategy is a blend
Targeted results & of
outcomes 1 . Deliberate &
purposeful
Strategy actions -
intended strategy
HOW to achieve 2 . As needed reactions
outcomes to unanticipated
developments &
fresh competitive
pressures -
unintended
strategy
Understanding Company Strategy - What to Look
For
Diversification

Actions to Responses to
Improve Changing
Conditions
Short
Term ProfitsThe Pattern of Actions That
How Key Define Strategy Fresh
Functions are Offensive to
Managed Gain Market
Edge
Defensive Product
Moves Line ,
Quality ,
or
Pursuing Geographic
Service
New Coverage
Forward
/
Backward
Opportuniti Integrati
es on
Why Good Management of Strategy
Matters?
1 . Powerful execution of a powerful strategy is a
proven recipe for success
2.
3 . Crafting & implementing strategy are CORE
management functions
4.
5 . To qualify as WELL - MANAGED , a firm should
• Have an attractive strategy
• Demonstrate proficiency in executing
strategy
9.
10 . A good strategy is strong enough to overpower
rivals & flexible enough to overcome obstacles
11.
12 . Without proficient strategy execution , firm
cannot achieve peak performance
Why is a Firm ’ s Strategy Constantly
Evolving?

Because firms often need to react to


•Changing market conditions
•Moves of competitors
•New technologies & production
•Capabilities
•Evolving customer needs & Preferences
•Political & regulatory changes
•New windows of opportunity
•Fresh ideas to improve current strategy
•A crisis situation
FOURTH TASK
IMPLEMENTING
STRATEGY
Implementing strategy Strategy Implementation
involves
Strategy implementation
•Creating fits between is an internal ,
way things are done & operations - driven
what it takes for activity involving
effective strategy organizing , budgeting ,
execution motivating , culture -
•Executing strategy building , supervising ,
proficiently & and leading to “ make
efficiently the strategy work ” as
•Producing excellent intended !
results in timely
manner
•Most important FITS are
between strategy AND
Organizational
capabilities
•Reward structure
•Internal support systems
•Organizational culture
WHAT DOES STRATEGY IMPLEMENTATION INCLUDE?
1 . Building a firm
capable of
carrying out 5 . Installing support
strategy systems
successfully 6 . Tying reward
2 . Allocating ample structure to
resources to achievement of
strategy - critical results
activities 7 . Creating a
3 . Establishing strategy - supportive
strategy - supportive corporate culture
policies 8 . Exerting strategic
4 . Instituting best leadership
practices &
programs for
continuous
FIIFTH TASK
EVALUATING
PERFORMANCE
1 . None of the tasks of strategic management are a one - time
only exercise
2.
•Times & conditions change
•Events unfold
•Better ways to do things become evident
•New managers with different ideas take over
3.
4 . Managers must

•Constantly evaluate performance
•Monitor situation & decide how well things are going
•Make necessary adjustments
5.
6 . Corrective adjustments can entail

•Altering firm ’ s long - term direction
•Redefining the business
•Raising or lowering performance objectives
•Modifying the strategy
•Improving strategy execution
STRATEGIC ROLES OF A BOARD OF DIRECTORS
1 . See that five strategic
management tasks are 5 . See that five strategic
performed adequately management tasks are
2. performed adequately
3 . Review important 6.
strategic moves & 7 . Review important
officially approve strategic moves &
strategic plans officially approve
4. strategic plans
5 . Ensure strategic 8.
proposals are 9 . Ensure strategic
adequately analyzed & proposals are
superior to adequately analyzed &
alternatives superior to
6. alternatives
7 . Evaluate caliber of top 10.
management ’ s strategy - 11 . Evaluate caliber of
making & implementing top management ’ s
skills strategy - making &
BENEFITS OF STRATEGIC APPROACH TO MANAGING

1 . Guides entire firm


regarding “ what it is 1 . Unites numerous
we are trying to do & strategy - related
to achieve ” decisions of managers
at all organizational
2. levels
3 . Lowers management ’ s
threshold to change 2.
3 . Creates a PROACTIVE ,
4. rather than REACTIVE ,
5 . Provides basis for atmosphere
evaluating competing
budget requests & 4.
steering resources to 5 . Enhances LONG - RANGE
strategy - supportive , performance
results - producing
areas
Thank
You
All