LPG Marketing in Competitive Environment in India

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LPG Marketing in Competitive Environment A Case of Small Size Cylinder Package

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Transcript of LPG Marketing in Competitive Environment in India

Page 1: LPG Marketing in Competitive Environment in India

LPG Marketing in Competitive Environment

A Case of Small Size Cylinder Package

Page 2: LPG Marketing in Competitive Environment in India

Content Analysis

Introduction

Potential Customer

Market Size

Launching Strategy

Branding and Promotion

Pricing

Distribution

Page 3: LPG Marketing in Competitive Environment in India

OverviewGrowing with India – BPC Gas!

• Since inception of FTL in October 2013, growth rate of BPCL in 5kg LPG cylinder has been 60.43%approx

Page 4: LPG Marketing in Competitive Environment in India

Target Customers Potential Customers

Rural & Hilly Households

• I.T. professionals or consultants• Students • Small offices-pantries• Back-up cylinder in the

households• Small eateries/ food stalls/ SME

food enterprises• Picnics/ outings• School/ college laboratories

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Potential Market Size• Urban Market Focus Regions

Zones Regions Potential Consumers

North Zone Delhi, NCR, Gurgaon, Noida

I.T. Professionals, Consultants, Industries

North West Zone Rajasthan Students, Industries

West Zone Mumbai, Pune, GujratStudents, I.T. Professionals,

Consultants, Industries

South West Zone KarnatakaStudents, I.T. Professionals,

Consultants, Industries

South Zone Chennai, Hyderabad, Thiruvananthapuram

Students, I.T. Professionals,

Consultants, Industries

East Zone Kolkalta, Bhubhneshwar I.T. Professionals, Consultants, Industries

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• Rural Market Focus Regions

Zones Regions No. Of Inhabited Villages (Approx.)

North Zone Uttar Pradesh 97,942

North East Zone Seven Sister States of Northeast India 65,375

Central Zone Madhya Pradesh 52,117

East Zone Orissa 47,529

West Zone Maharashtra 41,095

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LAUNCHING STRATEGY

USP ‘Paramount Quality in Compact Quantity’

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DetailsBrand Development and Promotion

Two Campaign Launch- Rural Market & Urban Market

6 Cities & 15 outlets 640 districts

Promote and Educate alternate uses of LPG• Chemical Feedstock

• Centralized Heating Solutions• Production of Electrical energy by running Turbines

• Paper Industry• Food processing Industry

• Agriculture use – Drying process• Refrigerant

Expand to

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Pure LPG

KeroseneFirewoodCoalIllegal LPG

Promote Legal and Safe use of LPG

Safe Health..Safe Home..

Safe Environment!

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Brand Development & Promotion

Product Name : CHIRAG LPG

Method of Approach

Above The Line Below The Line

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Campaign 1: Urban Market

“Bringing warmth to your kitchen” Concept: Expand customer base along with brand awareness

Objective: Product promotion and decrease black marketing of LPG

Buzz Creation:ATL Approach: For PG students and temporary residents, the promotion

shall be done through news & social networking sites- 99acres.com, olx.com, quickr.com, facebook.com, gmail.com, indiaproperty.com, sulekha.com, magicbricks.com,etc.

BTL Approach: • Promotion activities carried out in corporate parks and recreational

areas like canteen and refreshment places• New registration canters will be setup at Top I.T., Consultant and BPO-

KPOs.

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• Areas: 6 Zones• Sub Areas: Delhi, NCR, Gurgaon, Noida, Rajasthan, Mumbai, Pune,

Karnataka, Chennai, Hyderabad, Thiruvananthapuram, Kolkalta, Bhubhneshwar

• Duration: Canter activity will be setup for 2 days at Office Premises

• Post Campaign Members will be sent an email/ newsletter consisting details of the FTL

products. It will consist a link to the main company website which will help them

locate nearest store for FTL cylinder. Top Safety Guidelines for usage of LPG

• Measurement of Effectiveness1. Number of new registrations2. Sale monitoring -FTL-5kg & 3kg 3. Enquiries generated

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Campaign 2: Rural Market ‘Aapke choolhe ki Jaan- CHIRAG LPG’

Concept: Safety Training + Customer Base Expansion

Objective: Creating awareness regarding safety and quality of using the product alongwith alternative use of LPG in agriculture.

Buzz Creation: ATL Approach: Wall Paintings and Pictoral Pamphlet distribution, BPC Gas

Dealer outlet banner and billboard displayBTL Approach:• Short film/ skit on safety measure to be followed in the kitchen, uses and advantages of LPG• Conducted during the Gram Panchayat weekly sessions, Local Haat/Mela(Fun Fair)• Fabricated canter will visit the village

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• Areas: 5 Zones• Sub Areas: Uttar Pradesh, Seven Sister States of Northeast India,

Madhya Pradesh, Orissa, Maharashtra- 2092Talukas

• Duration: 1 day per Taluka

• Post Campaign: A training session conducted at their nearest distributor outlet/

taluka regarding alternative usage and optimal use of LPG cylinder. They can further spread awareness about safety in their

neighbourhood.

• Measurement of Effectiveness: 1. Number of Registrations 2. Sale of FTL-5kg & 3kg 3. Enquiries generated

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Pricing Strategy• Price influencing Factor-Import Parity Basis.

• The price of LPG cannot remain fixed as it is market based

• However, company will incur low mantainence cost as the cylinder will be sold off from the counter and holding cost will reduce.

• We propose reduced price rate for the existing pricing of 5kg FTL cylinder

• Proposed redesigning of 5kg LPG cylinder can be done in terms of reducing the weight

• Introducing 3kg LPG light weight cylinder

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Cost Components Existing Rate New Rates (5 kg)

New Rates (3 kg)

Production of Cylinders Rs. 1000/- (approx)

Rs. 500-600/-(approx)

Rs.360/- (approx)

Production of LPG Rs. 400-500/-(approx)

Rs. 400-500/-(approx)

Rs. 300/-(approx)

Regulator (if required) Rs. 250/- Rs. 250/- Rs. 250/-

Hose/ Tube (if required) Rs. 100/- Rs. 100/- Rs. 100/-

Administrative charges Rs. 25/- Rs. 15/- Rs. 15/-

Price Component Chart of 5 kg and proposed 3 kg FTL Cylinder

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Price Scheme of 5 kg & 3 kg FTL cylinders

Items Existing Price New Price

5 kg FTL cylinder + regulator Rs. 1450/- Rs. 1165/- (Approx)

5kg FTL cylinder Rs. 1200/- Rs. 915/- (Approx)

3 kg FTL cylinder + regulator NA Rs. 925/- (Approx)

3 kg FTL cylinder NA Rs. 675/- (Approx)

Below are the costs of 5kg FTL Cylinders taking into consideration the cost components as mentioned above:-

Post use of 5kg cylinder, the consumer can return back the cylinder and buy a new LPG cylinder.

Refund option of 15% (out of production cost of cylinder vessel) can be deducted from their new purchase.

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Distribution Channel

OMC Respective Distributor

COCO Retail outlets Customers

Current distribution channel:-

Proposed Distribution Channel:-

ORO- Other Retail Outlets

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O.R.O.Urban

Supermarket outlets like:-• Big bazaar• Food bazaar• Star Bazaar• D-Mart• Hypercity• Reliance Fresh• Other upcoming departmental

stores like Walmart & TESCO.

RuralNo. of Talukas present in our

target states

STATES NO. OF TALUKAS

Uttar Pradesh 821

Seven Sister States of NorthEast India 59

Madhya Pradesh 540

Orissa 314

Maharashtra 358

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Stock Keeping Units

• Give consumer wider choice in terms of buying options.

• Establishing similar operative system with quality and optimization as of larger LPG cylinders to FTP cylinders.

• Stresses on increasing the sales of FTP cylinder of 5 kg and 3 kg.

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Recommendations

• R & D on reducing the weight of cylinder vessel by use of alternative metal/material

• PAN India marketing campaigns throughout the pilot stage

• Introduce ‘order-your-cylinder-online’ and ‘nearest store locator’

• Speed delivery within 30minutes-1hr. (depending upon area reach)

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TEAM TROJAN

Thank You!