in

Indian Hair Oil Market

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Course: Marketing Management

Course Code: BUS 620.6

Submitted To: Prof Dr. Sheikh Mohammed Rafiul Huque

Submitted By:

Group No. 03

NAME ID
Tahmid Azeez Chaudhuri 1815280060
Marvin Malthus Gomes 1815226660
Asif Sadat 1815274060
Ajijul Islam Sakil 1715161060

Date of Submission: July 25, 2018

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Table of Contents

Introduction 4
Company Profile 4
Internal and External Factors of Dove Elixir & Indian Hair Oil Market 5
Major Problem Identification 6
Indian Hair Oil market situation 7
Analysis of Dove Elixir in the Indian Market 7
Possibility of success for Dove Elixir in Indian Market 8
Concluding Summary 9
Reference

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Introduction:

Hindustan Unilever Limited (HUL), a majority-owned subsidiary of Anglo Dutch giant

Unilever, has been working its way into India since 1888, when it started selling its
products there. As India's largest consumer goods firm, HUL markets more than 400
brands that include beverages, food, and home and personal care goods. Some of its
names include Kwality Wall's ice cream, Sunlight dish detergent, Lifebuoy and Dove
soap, Lipton tea, Pepsodent toothpaste, Surf laundry detergent, maize, rice, and salt,
and its export division ships castor oil and fish. The company also sells bottled water
and over-the-counter medications.

Company Profile:

In 1931, Unilever set up its first Indian subsidiary, Hindustan Vanaspati

Manufacturing Company, followed by Lever Brothers India Limited (1933) and United
Traders Limited (1935). These three companies merged to form HUL in November
1956; HUL offered 10% of its equity to the Indian public, being the first among the
foreign subsidiaries to do so. Unilever now holds 52.10% equity in the company. The
rest of the shareholding is distributed among about 360,675 individual shareholders
and financial institutions.

Dove, one of the over-Rs 1,000-crore brands of Hindustan Unilever (HUL), India's
largest FMCG company, from outlasting P&G's similarly-positioned Camay with its
toilet soap to being extended to hair care and skincare like shampoos and body
lotions, Dove has also been one of HUL's fastest-growing brands. However, Hair oil
was its brand extension.

HUL ventured into the premium end of the hair oil market, one of the more
penetrated and tougher playgrounds in FMCG, with the Dove Elixir range. It launched
variants - Rose & Almond Oil (hair fall rescue), Hibiscus & Argan Oil (nourished shine)

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and Lavender & Olive Oil (dryness care) -meant for women aged 21-35 years, who are
not able to oil their hair due to their hectic schedules.

Internal and External Factors of Dove Elixir & Indian Hair Oil
Market:

Internal:

1. HUL Internal standard of not having a “me-too product” in any of its product
categories means that only the products with a potential to be a leader is
retained.

2. HUL is known to be the 6th most innovative company in the world.

3. Unilever’s products are used by 2 out of every 3 Indians.

External:

1. Market Size & Structure:

2. Major companies such as Marico, Dabur, Emami, P&G and Bajaj compete
fiercely in the Indian market.

3. Hair oil having one of the highest market penetrations at 90%, most companies
had been playing to their strengths so far.

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 4. Hair oil is perceived to provide benefits of nourishment, strengthening hair, faster
and better growth and reducing the problem of falling hair. Some consumers
perceive that massaging hair oil has a cooling impact on the head.

5. Hair oil market segment:

There are four main categories of hair-oils in India:

 Coconut oils: It has the highest market share among all other categories. It is
very popular in the south.

 Amla hair oils: The heavy amla hair oil market is primarily an urban driven
market and tends to be geographically concentrated in the northern parts of
the country.

 Light hair oils: It has experienced significant growth as consumers opt for
lighter, more modern hair oil products.

 Cooling oils: It is meant for cooling the scalp during the harsh summer months.
The ingredients in the cooling oils cause immediate relief by cooling the scalp.

6. Shampoos and non-oil hair care products. These new substitutes promise to
clean, moisturize, nourish and maintain one’s hair as well.

Major Problem Identification:

 Is there any chance of premium priced DOVE ELIXIR to be

successful in the Indian market?

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Indian Hair Oil market situation:

1. Hair oil industry is estimated Rs 1, 611 billion FMCG market in India, hair care
products make up approximately 8%.

2. Out of the above hair-care industry hair oils commands close to 50% of the
hair care market in India.

3. Estimates hair oil market size in India is pegged at around Rs 8,000 crore with
coconut-based oils accounts for 46 per cent. Non coconut or perfumed oil
segment has a market size of Rs 4,283 crore.

4. Hair oil having one of the highest market penetrations at 90%, most companies
had been playing to their strengths so far.

5. While coconut-based oils were dominated by Marico's Parachute, Bajaj and

Dabur are traditionally focused on almond and amla, respectively.

6. Average prices for hair oil products have risen from Rs. 22.25 per 100 ml in
2008 to Rs 40 per 100 ml in 2013 according to the IMRB trade report.

Analysis of Dove Elixir in the Indian Market:

Pricing Strategy:

Dove Elixir, hair oil range is far more premium than existing brands. The 90ml bottles
costs Rs 185, while other premium hair oils like Dabur Vatika costs around Rs 50 for
100ml and Bajaj Corps has priced its 100 ml Bajaj Almond at Rs 55. A close contender,
Parachute Hair Oil-Ayurvedic is cheaper than Dove Elixir at Rs 95 for a 190 ml bottle.
Parachute Advanced Hot hair oil, which is targeted at users strapped for time as well
just like Elixir, costs Rs 45 for 100 ml.

Target Segment:

Dove Elixir entry into the premium segment was part of its overall company strategy,
as it was already present in the mid-market segment, with Clinic Plus Vita Oil and
Clear Anti-Dandruff Nourishing Hair Oil.

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The hair oil segment is largely concentrated in the mid-market, i.e. the middle-income
group, with coconut-based oils being the most popular. There isn't much of a
premium market in India.

In light hair oils, Dove Elixir had to compete with Bajaj Almond who’s leads with over
58 per cent value and volume share. Coconut hair oils are still lorded over by Marico's
Parachute (around 56 per cent) while cooling oils, which also command a premium
over amla and coconut hair oils, are led by Emami's Navratna brand (around 55 per
cent).

Packaging Strategy:

Dove Elixir seems to have got its packaging portion right. When customers upgrade to
a better or expensive product, they need not necessarily buy a big pack. As per
industry expert, "The frequency of usage is less for hair oils, which builds a case for
smaller packs. Thus, the premium price-point may not turn away customers."

Possibility of success for Dove Elixir in Indian Market:

Dove Elixir is a part of HUL's premiumisation drive. However, its positioning might
led to a slow growth. The hair oil segment is largely concentrated in the mid-market,
where competition is very high. Dabur Vatika, Bajaj Corps, Parachute Hair Oil are
offering less price than Dove. Substitute such shampoos and non-oil hair care
products which also promise to clean, moisturize, nourish and maintain one’s hair as
well might be more popular to generation X.

Dove Elixir to create a latent demand for its self among Indian customers might be
very difficult & time consuming. It will not be possible to get success for Dove Elixir in
given market situation.

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Concluding Summary:

There is no doubt that Dove is one of the global leading brands of Unilever under
personal product category with presence in 80 countries worldwide. Literally, it was
positioned as a premium category brand globally. Unilever developed this brand upon
their internally developed tracker “Living Standard Measure” (LSM) and Dove scored
higher in LSM indicates the brand for higher living standard people. Therefore, it is
easily understandable that they targeted metropolitan areas or premium segment as
their target market.

As the market was growing for hair oil, Hindustan Unilever Limited (HUL) introduced
Elixir in 2012 with positioning it under super-premium brand. Though, it was a late
entrant into the market. In practical, mid-market segment is the vast market for hair
oil where stiff competition had existence due to the presence of other products
belonging with Marico, Dabur, Bajaj and Emami. HUL targeted only major
metropolitan area’s population for its premium priced hair oil. So, they already
overlooked the mid-market segment where the users for this category product was
huge. Consequently, the products led to slow growth for its positioning. And, premium
priced product cannot go for long run in mid-market segment with the existence of
stiff competition.

In fine, it is difficult and time consuming to create a latent demand among Indian
customers for Dove Elixir. Although, HUL was trying to create emotional and rational
appeal towards customers through print and media. They were trying to instruct a
forgotten habit into daily routine by customizing the product in that fashion and
trying to do away with the stigma attached with oiling hair.

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REFERENCES:

Agarwal, S. (2009), “Can Kwality Walls beat the heat?”, Business Standard, available at:
www.business-standard.com/india/news/can-kwality-walls-beatheat/366569/
(accessed 16 January 2013)

Annual Report and Accounts (2008), “Unilever Limited”, available at:

www.unilever.com/images/ir_ar 08_annual-report_tcm13-163124.pdf (accessed 23
December 2012)

Arora, B.S. (2012), “ISE India research”, available at:

www.iseindia.com/ResearchPDF/FMCG_Update
1.pdf (accessed 16 January 2012)

Bajaj Corporation Limited (2011/2012), “Annual report 2011-2012”, Bajaj Corp Ltd,
p. 37.Bajaj Corporation Limited (2013), “Investor presentation, Bajaj Corp Limited”,
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(accessed 5 March 2013).

Balakrishnan, R. and Banerje, R. (2010), “HUL’s Vaseline getting a makeover”, The

Economic Times, available at: http://articles.economictimes.indiatimes.com/2010-04-
28/news/27584551_1_skin-caremoisturising-
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(accessed 28 January 2013)

Bhushan, R. and Malviya, S. (2013), “Ad war: Dettol’s campaign on kitchen cleaning
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Business Standard (2011), “KIT: the men’s deodorant market in India”, available at:
www.businessstandard.com/article/management/kit-the-men-s-deodorant-market-
in-india-111072500032_1.html

Chatterjee, P. (2010), “Light segment nourishes Rs 5,770-cr hair oil market”, The
Hindu Business Line, available at:
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