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    Cavinkare: Individual Assignment On

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    pawann raj chauhan
    1) CavinKare started in 1983 with a single shampoo product called Chik Shampoo targeting lower-middle class consumers in rural India. 2) Founder CK Ranganathan saw the huge potential in rural India's 74% population and tapped into that untapped market where multinationals were not present. 3) CavinKare's use of affordable sachet packaging and distribution through periodic rural markets helped Chik Shampoo succeed and the company eventually expanded its product range beyond haircare into personal care products.

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    Cavinkare: Individual Assignment On

    Uploaded by

    pawann raj chauhan
    99 views4 pages
    1) CavinKare started in 1983 with a single shampoo product called Chik Shampoo targeting lower-middle class consumers in rural India. 2) Founder CK Ranganathan saw the huge potential in rural India's 74% population and tapped into that untapped market where multinationals were not present. 3) CavinKare's use of affordable sachet packaging and distribution through periodic rural markets helped Chik Shampoo succeed and the company eventually expanded its product range beyond haircare into personal care products.

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    1) CavinKare started in 1983 with a single shampoo product called Chik Shampoo targeting lower-middle class consumers in rural India. 2) Founder CK Ranganathan saw the huge potential in rural India's 74% population and tapped into that untapped market where multinationals were not present. 3) CavinKare's use of affordable sachet packaging and distribution through periodic rural markets helped Chik Shampoo succeed and the company eventually expanded its product range beyond haircare into personal care products.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    99 views4 pages

    Cavinkare: Individual Assignment On

    Uploaded by

    pawann raj chauhan
    1) CavinKare started in 1983 with a single shampoo product called Chik Shampoo targeting lower-middle class consumers in rural India. 2) Founder CK Ranganathan saw the huge potential in rural India's 74% population and tapped into that untapped market where multinationals were not present. 3) CavinKare's use of affordable sachet packaging and distribution through periodic rural markets helped Chik Shampoo succeed and the company eventually expanded its product range beyond haircare into personal care products.

    Copyright:

    © All Rights Reserved
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    Download as pdf or txt
    of 4

    Individual Assignment

    On
    CavinKare

    Adaptive Market Leadership

    COURSE FACILITATOR: Prof Subodh Tagare

    Submitted By: Pawan Raj Chauhan


    201831029 (Section D2E)

    1|Page
    CavinKare Private Limited

    About Company
    In 1983 with a single product, CavinKare started out as a small partnership firm Chik India by
    Mr. C.K. Ranganathan.Chik India, which was renamed as Beauty Cosmetics in 1990.In 1998 the
    Company was renamed as CavinKare Pvt. Ltd (CKPL).The reason behind the name is,Cavin
    means beauty in Tamil and 'care' is spelt as Kare.

    CK Ranganathan, Chairman and Managing Director of CavinKare, has shown the world it is
    possible to beat the multinationals even in the most difficult market of fast moving consumer
    goods. A journey of their business started with only with Rs.15, 000 is now worth Rs.500 crore.
    He learnt the first entrepreneurial Lessons from his father, Chinni Krishnan, who started a small-
    scale pharmaceutical packaging unit, before moving on to manufacture pharmaceutical products
    and cosmetics. His entrepreneurial zeal and single-minded commitment to business helped him
    in his pursuit.

    Rural markets- "A world of opportunities"

    The rural population in India represented a vast untapped market & accounted for 74.27% of the
    population of India and contributed 60 % to India's GDP. The multi-national companies did not
    look at the rural markets and hence CavinKare had the opportunity to tap the market

    Introduction of Chik Shampoo

    Chik Shampoo introduced in 1983 and targeting at lower middle class and semi-rural population
    with monthly income of Rs.1500-3000. By tapping the rural markets which we have shown that
    had a huge potential, this product made a huge success there. And also due to lack of presence of
    multi-national companies, they got an advantage in the market.

    The origin of the concept of sachets

    His father had come out with the sachet concept when he introduced Velvette shampoo in
    sachets in 1976 and from there Chik single serve sachets evolved which is in a form of low unit

    2|Page
    packs and gave boost to shampoo consumption in India and hence Ranganathan was often
    referred as "the moving force behind the sachet revolution".

    Evolution of CavinKare

    The Company, which primarily relied on contract manufacturing for many years, has now set up
    Its own world class plant at Haridwar to cater to the demand of both domestic and international
    market. The Company has employee strength of 576, an all India network of 1300 Stockiest
    catering to about 25 lakh outlets nationally. CavinKare has touched a turnover of over 5000
    million INR in 2006-2007. CavinKare evolved from single product i.e. Chik Shampoo to having
    several products portfolio from hair care to personal care products.

    Evolution of Chik Shampoo

    Ranganathan named it Chik Shampoo after his father. The product launched in 1983 and did not
    succeed immediately due to presence of 100 brands of shampoo and had very low awareness
    among consumers but because of sachets revolution they had making profits and by execution of
    various communication strategies they were able to increase awareness about their product and
    hence Chik shampoo considered to be the success of CavinKare in India.Chik market share have
    goes on increasing from 1% in 1984 to 25 % in 2002.

    Evolution of various Product range

    Being continued with Chik Shampoo for seven years they introduced Meera Herbal Powder
    which is evolved due to he felt that there was a demand for herbal products and required a good
    product. And Meera Herbal powder topped the market in first of its three months and had 95 per
    cent market share in six months only. As panned to expand to new products they got into beauty
    cosmetics products as well. They also had perfumes for poor which cater to those who cannot
    afford (high priced) perfumes. He decided to come out with an Rs.10 pack Spinz. He was
    successful in that too.

    3|Page
    Choices and Actions helped CavinKare to Succeed

    Communication Strategies:

     When CavinKare entered into market the main challenge for Chik shampoo was lack of
    awareness among rural consumers and their habit of using ordinary soaps to wash their
    hairs instead of using shampoos products.
     CavinKare discovered that soap usage was the biggest barrier and people did not see the
    need for using Shampoo. Company tried to convey the message to the consumer that soap
    usage was bad for the hair and when a product exists specifically for hair it should be
    used.
     So they had to create such communication plan which connect to consumers as well as
    create brand awareness. So initially they had radio advertisements with use of popular
    movie dialogues which supports the brand and also roped into various popular movie
    stars from South India.
     They also did live demonstration of shampoo usage and product benefit.
     They started road shows, wall-paintings, and video-on-wheels as their advertising
    campaigns.
     They distributed free samples and went for door to door sampling only to increase
    awareness.
     They also launched consumer promotion scheme to create the consumer pull and induce
    trials.
     These activities help them to increase their sales from Rs.0.5 million to Rs.3.8 million in
    one year.

    Distribution Strategies:

     The company faced hurdles in its drive for expansion at the national level and challenge
    was to establish a nationwide distribution network. And as they primarily targeted at rural
    markets where retail density was extremely low.
     Innovative manner to gain distribution access they had to develop channel.
     For designing channel they started to approached the periodic markets like haats and
    melas which served about 4000 rural consumers over 10-15 villages.
     They found out that 58% of rural consumers preferred to purchase from that markets
    because of better pricing, quality and product available there. Because of which
    CavinKare distribution system manage to reached out 0.75 million outlets which is at par
    with major competitors.

    4|Page

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