CavinKare Private Limited

Group E-14
1.

12-Jun-16

What are the key marketing strategies followed by CavinKare till now and what are its key strength areas?
The key marketing strategies and the strength areas for CavinKare can be summarized as follows:

2.

Identifying gaps in consumer needs and current product offerings

Providing Quality products at affordable prices
Engaging in garnering consumer insights to encourage product innovations through a solid R&D capability
Building an extensive distribution network
Outsourcing of the manufacturing to focus more on the marketing efforts
Targeting the untapped rural markets and low-income urban markets
Building a new user base for the category as well as inducing repeat trials by using sachets and single use packs
Focus on building brand and gaining consumer visibility through television, print and radio commercials
Localized marketing use of regional media & celebrities and haats and melas.

Can CavinKares strengths be mapped over to the key success factors in the soap & detergent industry?
The Key Success Factors for the soap & detergent industry and its mapping to CavinKares strengths are:

3.

Understanding customers The industry requires an understanding of the gaps present, and identifying the buying
pattern and usage behavior of the customer to successfully introduce a new product. Using its four-pronged strategy,
CavinKare has been highly customer-oriented, and hence possesses this much-needed strength.
Offering value As is with any consumer goods in the Indian market, the soap & detergent market would need a
value-for-money product that provides better quality at lower prices. CavinKare has always focused on this particular
aspect of marketing, and has gained a lead on its competitors owing to its superior quality products at affordable price
points.
Distribution network The success of product in the category would depend on where the brand lies on the
affordability vs availability matrix. CavinKare identified the gap at the far end of this, and built extensive distribution
network to the tune of 0.75 million retail outlets, second only to HLL. It also adopted a novel strategy of making
inroads into the fragmented rural market by targeting the Haats and Melas.
Brand building A strong brand would help the company make a successful new product introduction and consolidate
its position sooner than its competitors. CavinKare leveraged on their mass appeal through innovative advertisements
and celebrities as the brand ambassadors. They had a unique format of packaging in the form of small packs, like first
time use of dab-on perfume pack and single-use perfume, patented packing for herbal oil etc.

How similar or dissimilar soap & detergent product category is, in comparison to the product category in which
CavinKare has substantial presence?
Similarities:
High volume and low margin products
Use of the same distribution network to reach out to the customers
Highly competitive and consistent product innovation and marketing required
Dissimilarities:

4.

Soap & Detergent industry is in mature phase and the growth has stagnated
Little or no product differentiation
Low barriers of entry in the soap & detergent manufacturing
Recently, the competition at the lower spectrum of the market has shot up
High level of penetration in the soap & detergent market

Should the company enter the soap & detergent factory, owing to the ongoing price war or should it discard this
plan?
CavinKare should discard its plans of entering the soap & detergent market owing to the unfavorable environment due to
high competition from HLL and P&G ensuing in a price war. There is very little scope for the company to distinctly
position its product in the market, as the product differentiation is very low. The market has a penetration rate of more
than 95% in the urban areas and more than 85% in the rural areas, and the scope for growth is very low. Also, although
the strengths of CavinKare can be mapped over to the soap & detergent industry, the key differentiating factors of low
price-high quality, strong distribution etc are being actively pursued by the competitors. Hence, CavinKare would just be
focusing its energies on a market that is hard to capture, with little to no success.