Case study: Repositioning Dabur
Table of Contents
Case study: Repositioning Dabur3
Introduction3
1.Appraise the factors that drove Dabur to reposition itself from a provider of Ayurvedic products to an herbal FMCG company.3
2.Critically evaluate the marketing activities undertaken to reposition the company.8
Brand Rejuvenation10
3.Outline a strategic marketing plan to secure continued growth for Dabur.11
HR Initiatives14
IT initiatives15
Supply chain Initiatives15
Other important changes15
Vision 201016
References18
Case study: Repositioning Dabur
Introduction
India Brand Equity Foundation states the Indian FMCG (Fast Moving Consumer Goods) sector as the fourth largest sector in the economy with a total market size in excess of US$ 13.1 billion. The FMCG market is expected to grow from US$ 11.6 billion in 2003 to US$ 33.4 billion in 2015. Penetration level as well as per capita consumption in most product categories like jams, toothpaste, skin care, hair wash etc in India is low indicating the untapped market potential. Growing Indian population, particularly the middle class and the rural segments, presents an opportunity to makers of branded products to convert consumers to branded products. The period from year 2000-2004 saw slow growth of the FMCG sector. While 2004 was a difficult year owing to weaker demand and intense competition, in 2005, there was a reversal in trend and FMCG companies were able to get a larger share of the consumer's wallet. One of the key performers in the Industry has been Dabur India Ltd.
Appraise the factors that drove Dabur to reposition itself from a provider of Ayurvedic products to an herbal FMCG company. It is important to realise that this year's revival in the FMCG sector has been largely volume driven, with improved off- take in urban as well as rural areas. The volume growth has also been accompanied by a degree of price stabilisation, especially after a couple of years of fierce price competition in some FMCG segments. Companies have had to reposition brands, create niches for their products and improve distribution systems to make the best out of the opportunities offered by an improved market environment. Through a structured implementation of strategic initiatives over the last couple of years, Dabur had geared itself for the challenges thrown up during the year. (Millar 1992) The Company had already positioned itself on the herbal specialist platform to create a niche within the FMCG space. Even before 2004-05, a robust brand architecture with five umbrella brands was put in place with a well-calibrated mix of products under each brand. On the distribution side, the process of streamlining of the sales organisation had begun a couple of years ago. This was further consolidated during 2004-05, which helped the Company penetrate much deeper into semi-urban and rural markets and tap into the demand growth in these areas. (Johnson 2005)
Source: ORG MARG, based on sales value
Chart B: Inflation (WPI)
There were several reasons for Dabur to believe in the value proposition that Balsara business offers. First, its oral care business fits well with Dabur's herbal positioning and will allow ...