Rural marketing in Asian Paints

Presented by: chiranjeet bhatt Shashi tripathi Devendra mishra Arnikabaranwal Vamshi pyiya Rajlakshmi

CONTENTS Paint industry

Introduction

History

Vision & Mission

Business strategy

Marketing sales distribution

Supply chain

Supply Elements

Distribution channel

Business strategy: Rural marketing

Wide range of products of rural marketing

Distribute to rural areas

Tool for understanding rural markets

Paint industry estimated at Rs. 135bn.

Unorganized sector accounts to 35% of paint market.

Volume growth estimated at 15%.

India’s share in the world paint market is 0.6%.

Per capita consumption of paint in India is 1.2kg/annum.

Paint industry

Introduction• Started in 1942 by four entrepreneurs:

Champaklal choksey, Chimanlal choksey, Suryakant Dani and Arvind Vakil as

“ASIAN OIL & PAINTS COMPANY.”

• Within three years, their turnover reached 3.5 lacs.

• Started with a strategy “Going to where Consumer is”.

• In 1967, Asian paints became the 10th largest paint company in the world.

History

In 1942, a partnership was started by four entrepreneurs.Mr. Champaklal choksey, Mr. Chimanlal choksey, Mr. Suryakant Dani and

Mr. Arvind Vakil as “ASIAN OIL & PAINTS COMPANY.”

In 1945, the firm was turned into a company.

In 1957, a plant was set up at Bhandup, Mumbai.

In 1967, Asian paints became the 10th largest paint company in the world.

In 1973, AP became a public ltd company.

In 2002. AP was a market leader of Indian Decorative Paints with market share of 44%.

Vision & Mission

Vision:

“Asian Paints aims to become one of the top 5 Decorative Coatings companies worldwide by leveraging its expertise in the higher growth emerging markets. Simultaneously, the company intends to build long term value in the Industrial coatings business through alliances with established global partners.”

Mission:TO BE THE LARGEST DECORATIVE PAINT CO.

WORLDWIDE AND TO BE THE 5TH LARGEST PAINT MANUFACTURING CO. WORLDWIDE.

Business Strategy: Asian Paints

• AP has acquired short-term competitive advantages by using its distribution strength and logistical efficiency in order to raise the Cost of doing business for all its competitors to attain this advantage.

• The advantage is short-lived and ultimately imitable. • Moreover, AP has established such an extensive network that

getting incremental advantage would be very difficult. • Futuristic approach should be gaining competitive advantage

through channel control or occupying mind space.

Marketing, Sales & Distribution for rural marketing

• Rural Marketing Initiatives since 1960.• Distribution is one of the main strategy of Asian

Paints.• Advertising & Promotional Expenditure started in

1980s.• Advertising Methods- Radio, TVCs, Print, Internet, OOH, POP, Retail Outlets, Seminars, Workshops.

Supply chain of Asian Paints

Headquarters in Mumbai 4 Factories 18 Processing Centers 350 raw material and intermediate goods suppliers 140 Packing Material Vendors 6 Regional Distribution Centre 72 depots are integrated

Elements of Supply Chain

• 3000 SKU’S

• RAW MATER

IALS• PACKAGING

MATERIAL

• KEY SUCCESS FACTORS• FLEXIBLE

OPERATIONS

• LOWER OUTPUT

TIME• LOW DELIVERY

COST

• 4 PLANT

S• 6 RDC• 35

JOB WORK CENTRES

• 77 DEPO

TS• 15000 DEALER

S

• 500 INDUSTR

IAL CONSUM

ERS

ANKLESHWAR

PLANT

KASNA

PLANT

PATANCHERU

PLANTBHANDUP

Secunderabad based location

Delhi based location

Bangalore based location

Chennaibased

location

Ahmedabadbased

location

Kolkatabased

location

77DEPOT

CENTRES

ASIAN PAINTS

HEADQUARTERS

MUMBAI

Distribution Network

Business Strategy: Rural Market

• Rural segment not mature enough to appreciate service related offerings

• Strategy should be product related. • Customer up gradation strategy should be

adopted. It should be Implemented in two parts.

1. The penetration of the rural segment have to be achieved by offering a basic product well tailored to match the low willingness to pay of the rural consumer.

2. After basic penetration levels have been achieved the rural consumer can be offered a “higher ” range of products with a view to up grading the consumers.

Wide Range of Products for rural market

Asian Paints used the strategy of offering a wide range of products to push competitors to the side and become the leading Indian company in decorative paint.

Companies that have a larger selection available for clients or customers are more likely to retain those clients and customers than companies which are limited and do not have the color choices.

By offering a wide range of products, Asian Paints has been able to broaden its customer base.

Distribute to Rural Areas A big problem with asian paint company in India was a competitive

market in the large cities, where distribution was relatively easy and the risks were low.

Asian Paints started by working from the rural areas, where distribution was a challenge and where the other companies had overlooked.

Instead of focusing in cities and urban areas, Asian Paints focused on a national level and worked in until reaching the cities

Tools for understanding rural markets in asian paints

Understanding of geographical differentiation. Media reports and exports opinions Interaction with brand developers, marketer researcher

& advertising experts. Inputs from one’s one marketing team Visit to rural areas and knowledge from first- hand

interaction with rural consumer.

Thank You