Nirma Success Story

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NIRMA SUCCESS STORY

HISTORYy Established in 1969 by Karsanbhai Patel y Patel a chemist at Gujarat Govt. Dept Of mining & y y y y y y

Geology Manufactured phosphate free synthetic detergent powder Yellow powder was priced `3.50/kg against HLL 15 Named the powder as Nirma, after his daughter Nirupama Sold 15- 20 packets daily in Kishnapur (Gujarat) Till 1985 - became most popular detergent brand By 1999, Nirma was a major consumer brand offering a range of detergents, soaps and personal care products

Contd..y Established 6 manufacturing facilities y Network of 400 distributors & 2 million retail outlets y Expanded to Bangladesh with JV of Commerce Overseas Ltd

PRODUCTSCONSUMER SOAPS DETERGENTS EDIBLE SALT NIRMA SHAMPOO NIRMA TOOTHPASTE SOURCING PRODUCT NIRMA SHIKAKAI INDUSTRIAL LAB (linear alkly benzene) AOL ( Alfa olefin sulfate) SULFURIC ACID SODA ASH PURE SALT SODA SILICATE GLYCERIN

MARKET SHARE

Expansion in Premium Segmentsy Entered into premium categories like Detergents , Toilet y y y y

Soaps , Hair Care market Detergents Nirma Super Washing Powder and Detergent Cake Toilet Soaps Nirma premium, Nirma Sandal, Nirma Lime Fresh Hair Care Nirma Shikakai, Nirma Beauty Shampoo Toothpaste Nirma Toothpaste

Contd..y Proper positioning with segmentationSEGMENTS Health Beauty Floral Lime Fresh NIRMA Nirma Bath Nirma Beauty Soap Nirma Rose Nirma Lime HLL Lifebuoy Lux Breeze Jai Lime

y Good quantity(high fatty matter), proper scents, low cost y Managing Geographical Diversity

- North prefer Pink soaps - South prefer Green & Sandal

Contd..y Advertising spend was low. y Branding with celebrity endorsements y Create an ad campaign after getting feedback y Retailer Margins on premium segment

Nirma Premium Soaps Nirma Shampoo

52 % 140 %

Failure of Nirma in Premium Categoryy Followed same price strategies as in economy

segments y Concentrated on volumes y Lacked good distribution network in urban areas y Less price sensitive segment then also focused on price y Initial image of mass category product or a cheap brand

DIVERSIFICATIONy Nirma soda ash plant at Bhavanigarh costing Rs 1040 crore. y Linear Alkyl benzene manufacturing facility y These two chemicals acount for three-fourth cost of y manufacturing detergent y Nirma LAB projects was the second of its kind in Asia. y As a part of backward integration, produce oleum and

sulphate.

OVERSEAS OPERATIONy In Bangladesh Nirma cornered 60% of the market

share because lower price then market leader Hindustan Lever Ltd. y Other countries under consideration y China Russia Sri lankay Overseas operation contribute Rs 20 crore.

Road to Successy By 1970, Nirma dominated the detergent powder market y By 1990, Nirma entered the Indian toilet soaps market

Nirma Beauty soap y By 1999, became Indias second largest manufacturer of toilet soapsToilet soaps 1999-2000Wipro Godrej Nirma Others HLL

Detergents 1999-2000Henkel Spic Others P&G HLL Nirma

CONCLUSIONy Nirma is among the top 3 players in

detergent industry as well as toilet soaps markets. y Aggressive pricing without compromising on quality. y Extensive Distribution Network.