ASSIGNMENT

STRATEGIC MANAGEMENT
DABUR INDIA LTD.
SUBMITTED BY-
AMISHA, AAYUSHI, CHIRAG, MANISH, GAURAV, ANUBHAV

About the Organization

Dabur India Ltd is one of the leading FMCG Companies in India. The
company is also a world leader in Ayurveda with a portfolio of over 250
Herbal/Ayurvedic products. They operate in key consumer products
categories like Hair Care Oral Care Health Care Skin Care Home Care and
Foods.
The company's FMCG portfolio includes five flagship brands with distinct
brand identities Dabur as the master brand for natural healthcare products
Vatika for premium personal care Hajmola for digestives Real for fruit
juices and beverages and Fem for fairness bleaches and skin care
products.The company operates through three business units namely
consumer care division (CCD) international business division (IBD) and
consumer health division (CHD).
Objectives Of Dabur
 To focus on growing its core brands across categories, reaching out
to new geographies, within and outside India, and improve
operational efficiencies by leveraging technology To be the
preferred company to meet the health and personal.
 Grooming needs of its target consumers with safe, efficacious,
natural solutions by synthesizing their deep knowledge of ayurveda
and herbs with modern science To provide its consumers with
innovative products within easy reach.
  To build a platform to enable Dabur to become a global ayurvedic
leader.
 To be a professionally managed employer of choice, attracting,
developing and retaining quality personnel.
 To be responsible citizens with a commitment to environmental
protection.
 To provide superior returns, relative to their peer group, to their
shareholders.
Organizational structure
Dabur is committed to create an open and transparent organization that is
focused on people and their capability, and fostering an environment that
enables them to deliver superior performance. Even during the trying times
that the industry was going through, Dabur remained committed to its
employees, continually investing in the development of its human
resources through a series of employeefriendly measures aimed at talent
acquisition, development, motivation and retention. People always have
been, and shall continue to be, central to Dabur's growth story. The
company's commitment can be gauged by the fact that Dabur absorbed all
the employees of the acquired entity - Fem Care Pharma Ltd. The Fem
business was, in fact, seamlessly integrated to leverage organizational
synergies. The Company also made significant investments for training in
the areas of marketing excellence, customer service and building higher
skill sets. During the year, the company introduced an audio-visual based
training programme for the Fem sales force. This programme - christened
SPORT - looked at addressing the specific needs of selling Fem products
to beauty and cosmetic outlets. All the field staff under the Fem network
were put through this programme that also adopted the ‘train the trainer’
route.
Internal Control Systems
Dabur has a robust internal audit and control system managed by qualified
and experienced people. PriceWaterhouse Coopers is the internal auditor
for the company and its subsidiaries. The Company follows Standard
Operating Procedures (SOPs) that are in line with the best global practices,
and have been laid down across the process flows, along with authority
controls for each activity. Dabur has also introduced the COSO framework
for internal controls and adequacy of internal audit. Under this framework,
various risks facing the Company are identified and assessed routinely
across all levels and functions, and suitable control activities are designed
to address and mitigate the significant risks. The internal audit department
reports to the Audit Committee of the Board of Directors, which
recommends control measure from time to time. To read the report of the
Audit Committee on internal control and adequacy, refer to the section on
Corporate Governance of the Annual Report.
Business Strategic Unit
Dabur India Ltd continues to move forward on the double-digit growth
track with sustained volume growth across all product lines. The year
2009-10, in fact, has shown one of the highest volume growths for the
company in almost a decade and what’s more encouraging is the fact that
this growth has come at a time when the industry has been struggling with
several downsides like poor monsoons, drought in several parts of the
country, rising input costs and one of the highest instances of food
inflation.
Organizational structure of Dabur includes 3 major Business strategic
unit(BSUs).
1) Consumer Care Division: This SBU caters to the
consumer needs
1. Consumer Care Division: This SBU caters to the
consumer needs pertaining to Personal Care, Health Care, Home
Care & Foods. The major Brands under this SBU are Dabur, Vatika,
Hajmola, Real and Fem.
Dabur India Ltd continued to focus on expanding its product offerings
to consumers by way of new product launches and expansion of
existing products with the rollout of newer variants, thereby
continuing to address the growing and ever-changing needs of its
consumers across both urban and rural India. The year also saw
Dabur introduce a variety of low-priced SKUs to increase
affordability for its products and deepen its rural penetration through
a host of sales and consumer initiatives
 Dabur India Ltd, with its various initiatives, was well poised to take
advantage of this growing consumption in Rural India, which in turn
helped Dabur’s Consumer Care Division (CCD) achieve robust
growth. CCD ended 2009-10 with 14.6% growth increasing its
revenue to Rs 2,326.5 crore.

2) Consumer Health Divison: This SBU pertains to the Ayurvedic

medicines
2. Consumer Health Divison: This SBU pertains to the Ayurvedic
medicinesand ayurvedic OTC. Major categories in traditional
formulations include Asav Arishtas, Ras Rasayanas, Churnas,
Medicated Oils.
The Consumer Health Division (CHD), offering a range of healthcare
products based on the age-old principles of Ayurveda, continues to be
a focus and high-growth area for Dabur. The company has formulated
a blueprint to further drive growth in this category with the launch of
a variety of new OTC (over-the-counter) healthcare products. The
CHD portfolio, comprising both OTC products and classical range,
registered
3. International Business Division: It caters to the health and personal
care needs of international consumers in middle east, north and west
Africa, EU and US. This division has high level of localization of
manufacturing and sales & marketing.
Dabur’s International Business Division (IBD) caters to the health &
personal care needs of customers across different international
markets spanning Middle East, North & West Africa, EU and US
through its brands Dabur and Vatika. Over the years, this business has
successfully transformed itself from a small operation focused on the
Indian diaspora to a multi-location transnational business with a
presence across 60 countries and catering to the ever-changing needs
and aspirations of the local populace in these markets.
Main Competitors for Dabur Products
Category of Dabur’s Share Main Competitors
products

Fruit Juice 58% Real Active Tropicana

Hair Oil 6.4% Vartika HUL, P&G,

Marico Shampoo 7.1% Vartika HUL, P&G

Shampoo

Hair Care 27% P&G, HUL

(Overall)

Himalaya 64% Pathanjali, Himani

Chyawanprash

Himalaya Honey 40% Himani Hambard

and Local Players

Digestive 37% Paras & Local

Players

Business Model of Dabur

Dabur follows a very unique business model called Umbrella Branding

Strategy. It means that all products are under one brand name. The logo
of Dabur is an old banyan tree that conveys Dabur’s heritage, dedication,
and stability.
Dabur uses a 3 tier distribution system, i.e., from stockist – to wholesaler
– to retailers – to final consumers. With this system, the products are
made available in departmental stores, grocery shops, etc, across the
country.
 The price of the different products of Dabur is reasonable to the
people of every class. As one of the company’s key dreams is ‘back
to nature’, all Dabur products are made with natural ingredients.
Dabur’s brand-loyal consumer base claims that all of the company’s
products are essentially organic.
 FMCG and pharmaceutical businesses were separated in 2003 to
ensure a better clarification of products. This led to the
discontinuation of the umbrella strategy that existed before.
 Sales Promotion is one of the main tools of the company’s successful
marketing strategy. There are different sales marketing instruments
that have been introduced by the organization for various goods so
far. Coupons, gift sets, refunds on money, and festive sales are some
of them. To improve the consumer base, merchandising, rewards, and
exchange deals are also offered to clients.

STRATEGIES IDENTIFIED IN THE ORGANIZATION

1. Corporate Strategy :
 Strengthen presence in existing categories and markets as
well enter new geographies.
 Maintain dominant share in categories where we are category
builders like Health Supplements, Digestives etc. and expand
market shares in other categories.
 International expansion- local manufacturing and supply
chain to enhance flexibility/reduce response time.
 Focus on R&D to develop new variants to cater to newer
markets.
 Target opportunities in focus markets and categories through
horizontal acquisitions to develop scale in existing markets
and vertical diversification to enter new ones we don’t have
that much expertise.
 2. Business Strategy:
 The urban-middle class has been gradually shifting towards
branded organized markets for consumer discretionary given
the growth in per-capita income. Newer, more contemporary
variants should be developed specifically to cater to this
segment.
 Rolling out new variants and products such as Babool (salt
variant), Gulabari (Moisturizing Lotion)
 Renovation of existing products to respond to changing
demands (Toothpowder to Toothpaste)
 Reinventing packaging to stand out among competitors.
 Dabur, whose food category is not so popular should enter
into acquisitions with packaged food makers to gain market
share in this category.

3. Functional Strategy:
 Adopting a push strategy in rural areas where Dabur can
display its products through Kirana Stores and its upcoming
retail shops.
 Advertising through social media focusing on
communicating changes in its product line and
communicating a revamp of its variants for the urban.
 Re-engineer its sales and distribution structure and drastic
rationalization of Dabur’s stockiest and distribution network.
 Inclusion of younger personnel in the top management to
provide inputs on changing demography of its customers
from Gen X to Gen, especially in the marketing team.
 Training to equip the functional staff to deal with customer
complaints and customer satisfaction training.
STRATEGY ANALYSIS

SWOT/TOWS ANALYSIS
 HELPFUL OPPORTUNITIES
 Natural brand
 Niche market
 New product development
 Better product packaging
 Health product
 Rural penetration

 HARMFUL THREATS
 Many competitors compete on cost and product range
 Herbal raw materials are demising

 INTERNAL STRENGTH
 Herbal brand
 In-house raw material
 High export
 Depreciation shown high
 Monopoly in chyawanprash
 High brand awareness
 Diversification

 STRENGTH - OPPORTUNITIES
 Moving towards natural by developing Real juices
 Partnership with banks and IOC to reach rural market

 STRENGTH – THREATS
 Using high promotion on IPL and TV ads – “Brave and
Beautiful”
 In-house more development of herbal resouorce – Nepal

 EXTERNAL WEAKNESS
 High cost
 Product length
  Consumer perceptions that brand is for people above 35 years
of age
 No branding by social media

 OPPORTUNITIES – WEAKNESS
 Increasing low cost product length to reach rural penetration
 Digital marketing to target niche market
 Branding as “Health and Wellness” – targets young, vibrant,
socialized

 WEAKNESS – THREATS
 Improvement in product basket to reduce threat from
competitor
 BCG MATRIX

High Low

Health Care (Oral) Personal Care (Hair)

H Health Care Home Care
I (Supplement)
G
H

Food Products (Health) Personal Care (Body)

Health Care (Digestive)

L
O
W

MARKET SHARE

CONCLUSION
In conclusion, Dabur needs to focus on their core brands to leverage
their competitive advantage. This needs to be done across new
geographies areas. Its strategic allocation of resources in leveraging
technology would help improve operational efficiencies. Strategic
positioning with increased brand visibility to occupy more shelf space
would strategically propel Dabur to the top three FMCG company in
India. Continuous innovation, especially in the personalcare segment,
internationally along with premium pricing in the US market will help
Dabur enhance its performance. Dabur is reinventing its target by
focussing on the middle aged people. Simultaneously, it is also building
a a contemporary brand that appeals to the youth with increased spend
on digital ads, and creating products with excellent packaging format
that gives the product sharper appearance and commands price premium.
In distribution, their wide network covers over 5.8 million retail outlets
giving them high penetration both in the rural and the urban market.
Dabur’s international sales contribution (30 percent of total sales) is
increasing over the years and it has increased their global presence to
over 60 countries where its brand popularity is increasing. Dabur are
present in the SAARC countries, Middle East, Africa, US, Europe and
Russia. This has happened despite political disturbances in MENA
region and the currency devaluation in Egypt and Nigeria. Their
Namaste America grew by 20 percent. The local coverage of the
potential rural market is covered by the “Project Double” wherein Dabur
has increased the rural coverage from 14,000 to 44,000 villages in the
past three years.