Fevikwik and the Pune market

Background
Pidilite Industries Limited is the largest adhesive manufacturer in India. It also has
world wide presence in adhesives, art material and industrial chemicals. Pidilite's most
famous brand is the Fevicol range of adhesives. Its other famous brands are Dr. Fixit,
Cyclo, Ranipal, Hobby Ideas, M-seal and Acron. Pidilite's corporate office is located in
Andheri (East), Mumbai.
It also makes Fevikwik -India's first ever One Drop Instant Adhesive. Fevikwik is
Indias leading instant adhesive brand, also known as the one drop instant
adhesive. Its ability to bond a variety of surfaces in a matter seconds makes it a
handy home and industrial adhesive.
One of the most popular applications among consumers for the instant one-drop
adhesive' is gluing back sandals and handbags that are coming apart, according to the
company's findings. The importance of end-consumer adoption is reflected in Fevikwik's
retail expansion available countrywide Pidilite company officials attribute the success
of Fevikwik to the following

Strong consumer brand, which is highly salient in consumer minds due to break
through advertising. In fact the instant adhesive category is defined by Fevikwik
in India.

Wide availability. It is available across over 3 Mln outlets across the country
including Urban and Rural areas. and probably among the top five to six FMCG
brands in terms of reach. Alongside Fevistik glue stick, it presents a compelling
proposition for retailers and stationery stores to stock. It is available across
various types of retail outlets including kirana, hardware, modern trade and pan
shops . It is available even in towns with 2,000 to 3,000 population.

Attractive pricing . Fevikwik is available in a variety of pack sizes (with the Rs 5

MRP SKU contributing to more than 80% of sales)

Type of end users:

Fevikwik's growth has come from adoption by household consumers (which contributes
to more than 70% consumption) in addition to craftsmen (auto mechanics, electricians,
plumbers, mobile repairmen, spectacle repairmen and the like)
Type of retailers:
The type of outlets through which the Fevikwik sell are - Hardware outlets, Hardware &
Sanitary outlets, Electrical outlets, FMCG & Kirana outlets, Stationary outlets, Auto

outlets, Industrial retail outlets. Different consumer segment purchase from different
type of outlets

The challenge in Pune

While Fevikwik has a market share of over 85% in the country , one of the areas where
there is strong presence of competition is Pune where a local brand Cheapy has been
in the market for a long time (much before Fevikwik) . While over the years Cheapys
share has eroded , it still has market share of 29% in Pune. Certain craftsmen segment
like Auto mechanics are loyal to the brand

Sales in Pune:
Average monthly sales (in cr)
Others, 0.15, 6%

Fevikwik
Cheapy, 0.76, 29%

Cheapy

Fevikwik,
1.74, 65%

Others

100%

0.47

0.16

50%

1.27

0.6

0%
Fevikwik

Cheapy

Wholesale

Brand

Pros

Cheapy

Fevikwik

Higher margin for distributors and

retailers
(Relatively lower DP (Dealer Price) of Rs
3.3 for retailers and DP of Rs 2.90 to Rs
3.15 depending on purchase quantity for
wholesalers)
Loyalty from craftsmen segment of auto
mechanics
Higher bonding strength
Better packaging material
High brand recall in household segment
(The category itself is identified by the
name Fevikwik)
Immediate replenishment of damaged
stock at retailer and wholesaler level

Cons

Quality not at par with

Fevikwik
Replacement of damaged
pieces from retailers is not
done at regular intervals

Rate issues in retail market

due to disturbance from
wholesale
Less margin for wholesalers
due to higher landing price
(DP of Rs 4.13 for retailers)

Strategies that Cheapy employs to grab market share from Fevikwik:

Cheapy:

1 Steel glass of MRP Rs 20 free with every box of 100 pieces (Rs 310). The
stock of 50 units is sold in a metal box (which if the retailer doesnt need
Cheapy salesmen reimburse Rs 10 for empty box in their next visit)
Gift schemes like LCD, mobile for Quarterly target achievement for wholesalers
and semi-wholesalers (15% scheme)
Monthly target achievement schemes of Blackberry mobiles for semi-wholesalers
which comes down to scheme of 3%-4%.

Fevikwik:

Currently operate gift scheme for Fevikwik in retail markets, wherein we give gifts
in the form of Miton pet bottle, Milton casserole, small light torch etc which comes
down to a scheme of 6%-7%
Pidilite runs visibility campaigns for Fevikwik wherein the salesmen use various
POPs to increase visibility and reinforcement for the brand.
Fevikwik does not give schemes in the wholesale market so as to control price
issues in retail market.

Deliverables:
Approach:
Consider that you have joined Pune branch as an Area Sales Manager. You have been
briefed that we have been losing market share to Cheapy due to decreasing demand
from wholesale. What would be your strategy to grab the market share back from
Cheapy ?
Targeting the market: Understand the difference between wholesale and retail . Can
we increase the contribution from retail? What would you target first? Wholesale or
retail? Specify the reasons.
You can focus on the Place & Promotion part of 4Ps of
Marketing to come up with solutions
Innovation: Our existing gift schemes in Pune are of the value of 6%-7% of DP
(Landing price for dealer). Can you come up with innovative ideas to increase demand
of Fevikwik in wholesale markets without altering the existing margins (We expect you
to do some research on the psyche of wholesalers and what really motivates them)