Case StudyPGDM 2009-11

1.Dabur –The Brand What Branding Strategy?

2.Product Offerings3.Brand Equity (Strength,

Analysis)4.Restructuring (Why and How-

the Approach?)5.SWOT (What)?6.Marketing Mix (What)?

ISSUES

• 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

SOME FACTS

• 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

Group Com

prises 1. Dabur Finance. 2. Dabur Nepal Pvt Ltd. 3. Dabur Egypt Ltd. 4. Dabur Overseas Ltd. 5. Dabur International Ltd.

Established in 1884, Dabur India Ltd is the largest Indian FMCG and “Ayurvedic” products company.

Products Groups

1. Health care, 2. Food products, 3. Natural gums &

allied chemicals, 4. Pharma, and 5. Veterinary

products.

Leading

Brands

1. Dabur Amla, 2. Dabur,3. Chyawanaprash,4. Vatika, 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• TOOTHPASTEFOODS 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.Differentiation2.Relevance3.Esteem4.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 EquityIdentities making up the brand

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

Marketing Activities

Associations of the brand

Why Restructuring ?

Problems1.Diversified into too many groups

• Lower Sales and Profits2.Image

• Ayurvedic Company3.Association

• Particular Age Group - 35 Plus Age

Restructuring Process1.Cut down on all its low Contribution Brand2.Position(ed) itself as an Herbal specialist

in the FMCG sector3.Set Higher Targets4.Identify/ied Growth Drivers5.Filling up the gaps in Oral Care as wellas

Hair Care market6.Set itself a new Brand Strategy7.Enter(ed) new potential areas and

targeted the youth as well school children

Branding StrategyChanged 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 StrategiesLine Extension Strategy was adopted by Dabur because:

1. It could attract different target audience2. Could renew Interest and liking for the brand by introducing

new variants3. It could increase its market share4. Diversify without much risk 5. Moved from its Core strategy and hence could give customers

something better and different6. It could attract different target audience7. Could renew Interest and liking for the brand by introducing

new variants8. It could increase its market share9. Diversify without much risk10.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. Youth2. Health Conscious People3. School Children4. Mothers5. Existing Old age group

PRODUCT

Products have been divided into 5 power brands

Quality : HighSizes : Available in different sizesDesign : Available in Tetra Pack, Bottles, Sachets

Sr.NoBrand Type

1. Dabur Healthcare (Chyawanprash)2. Vatika Herbal Beauty Brand3. Anmol Personal Care Market4. Real Foods5. 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

1. Century Old Company2. Established Brand3. Ayurvedic/ herbal Product line4. Leader in Herbal Digestives where the

product has 90% of the market share5. Innovativeness in Promotions

WEAKNESSES

1. Profitability is uneven across product line

OPPORTUNITIES

1. Extend Vatika brand to new categories like Skin Care and body wash segments

2. Launch several OTC brands3. Southern India Market4. Exploring new geographical

areas- local as well global5. Oral Care Segment6. Launching new Products like

Hair oils, Herbal and Gel Toothpastes etc

THREATS

1. Competition in the FMCG sector from well established names

2. Other fields of medicine- Allopathic and Homeopathic

3. Markets where Herbal products are not recognised

THANK YOU!!!

Strategic Management Process

PGDM 2009-11

WHAT IS “STRATEGY”?1. Consists of competitive moves &

business approaches to produce successful performance

2. Management’s “game plan” for

Running the businessStrengthening firm’s competitive position

Satisfying customersAchieving performance targets

THINKING STRATEGICALLY

3. HOW WILL WE GET THERE?

THREE BIG STRATEGIC QUESTION

S

1. WHERE ARE WE NOW?

2. WHERE DO WE WANT TO GO?• Business positions

management wants to stake out

• FINANCIAL outcomes to achieve

• STRATEGIC outcomes to achieve

FIVE TASKS OF STRATEGIC MANAGEMENT

TASKS

1

5

2

4

3

Defining business, stating a mission, & forming a strategic vision

Setting measurable objectives

Crafting a strategy to achieve objectives

Implementing & executing strategy

Evaluating performance, reviewing new developments, & initiating corrective adjustments

FIRST TASK

DEVELOPING A VISION

&MISSION

DEVELOPING A VISION & MISSION

Begins with thinking strategically

• About firm’s future makeup• Forming vision of firm’s future in 5-10 years

Task is to

1. Inject SENSE OF PURPOSE into firm’s activities2. Provide LONG-TERM DIRECTION3.Give firm STRONG IDENTITY4.Decide “WHO we are, WHAT we do, & WHERE

we are headed”

Mission

Ѳ An organization’s MISSION

reflects management’s vision of what firm seeks to do & become

provides clear view of what firm is trying to accomplish for its customers

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 industry?• What environmental scenarios are possible?

Why a Shared Vision Matters A strategic vision widely shared among all employees functions similar to how a magnet aligns iron filings

when all employees are committed to firm’s long-term direction, optimum choices on business decisions are more likely

individuals & teams know intent of firm’s strategic vision

daily execution of strategy is improved

Mission Statements

To be America’s best quick service restaurant chain. We will provide each guest great tasting, healthful, reasonably priced fish, seafood, and chicken in a fast, friendly manner on every visit.

To be the world’s best in chemicals and electronic imaging.

The mission is to improve the quality of human life; to enhance self-reliance and concern for others; and to help people avoid, prepare for, and cope with emergencies.

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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

SETTINGOBJECTIVES

1. Purpose of setting OBJECTIVES is to

• 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

• Complacency• Drift• Internal confusion• Status quo performance

3. Two Types of Objectives Needed

• 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 Objectives1. 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 OBJECTIVESNike : 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 Motor Company

: To satisfy our customers by providing quality cars & trucks, developing new 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

Corporation

: To become a low-cost, medium-size gold producer, producing in excess of 125,000 ounces of gold a year and building gold reserves of 1,500,000

THIRD TASK

CRAFTING A

STRATEGY

Strategy Making Concerns

HOW to

1. Achieve desired strategic & financial objectives

2. Out-compete rivals & win a competitive advantage

3. Respond to changing industry & competitive conditions

4. Defend against threats to firm’s well-being

5. Grow the business

Strategy as Planned and

Reactive to Changing Circumstances

Actual Strategy

Planned Strategy

Adaptive Reaction

Crafting A StrategyObjectives

Targeted results & outcomes

Strategy

HOW to achieve outcomes

A firm’s actual strategy is a blend of1. Deliberate &

purposeful actions - intended strategy

2. As needed reactions to unanticipated developments & fresh competitive pressures - unintended strategy

Understanding Company Strategy -What to Look For

The Pattern of Actions

That Define Strategy

Diversification

Forward /

Backward Integrati

on

Actions to Improve

Short Term

ProfitsHow Key Functions are

ManagedDefensive

Moves

Pursuing New

Opportuniti

es

Responses to Changing Conditions

Fresh Offensive to Gain Market

EdgeProduct Line,

Quality, or

ServiceGeographic

Coverage

Why Good Management of Strategy Matters?1. Powerful execution of a powerful strategy is a

proven recipe for success

2. Crafting & implementing strategy are CORE management functions

3. To qualify as WELL-MANAGED, a firm should• Have an attractive strategy• Demonstrate proficiency in executing

strategy

4. A good strategy is strong enough to overpower rivals & flexible enough to overcome obstacles

5. 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 involves

• Creating fits between way things are done & what it takes for effective strategy execution

• Executing strategy proficiently & efficiently

• Producing excellent results in timely manner

• Most important FITS are between strategy AND Organizational capabilities

• Reward structure• Internal support

systems• Organizational culture

Strategy Implementation

Strategy implementation is an internal, operations-driven activity involving organizing, budgeting, motivating, culture-building, supervising, and leading to “make the strategy work” as intended!

WHAT DOES STRATEGY IMPLEMENTATION INCLUDE?1. Building a firm capable of carrying out strategy successfully

2. Allocating ample resources to strategy-critical activities

3. Establishing strategy-supportive policies

4. Instituting best practices & programs for continuous improvement

5. Installing support systems

6. Tying reward structure to achievement of results

7. Creating a strategy-supportive corporate culture

8. Exerting strategic leadership

FIIFTH TASK

EVALUATING PERFORMANC

E

1. None of the tasks of strategic management are a one-time only exercise

• Times & conditions change• Events unfold• Better ways to do things become evident• New managers with different ideas take over

2. Managers must

• Constantly evaluate performance• Monitor situation & decide how well things are going• Make necessary adjustments

3. 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 DIRECTORS1. See that five strategic

management tasks are performed adequately

2. Review important strategic moves & officially approve strategic plans

3. Ensure strategic proposals are adequately analyzed & superior to alternatives

4. Evaluate caliber of top management’s strategy-making & implementing skills

5. See that five strategic management tasks are performed adequately

6. Review important strategic moves & officially approve strategic plans

7. Ensure strategic proposals are adequately analyzed & superior to alternatives

8. Evaluate caliber of top management’s strategy-making & implementing skills

BENEFITS OF STRATEGIC APPROACH TO MANAGING1. Guides entire firm regarding “what it is we are trying to do & to achieve”

2. Lowers management’s threshold to change

3. Provides basis for evaluating competing budget requests & steering resources to strategy-supportive, results-producing areas

1. Unites numerous strategy-related decisions of managers at all organizational levels

2. Creates a PROACTIVE, rather than REACTIVE, atmosphere

3. Enhances LONG-RANGE performance

Thank You All