A SYNOPSIS

ON
A COMPARETIVE STUDY OF SALES PROMOTION OF SOAP INDUSTRY
Report submitted in partial fulfillment of the requirement for the degree of

MASTER OF BUSINESS ADMINISTRATION

(G.B.TECHNICAL UNIVERSITY, LUCKNOW)

UNDER THE GUIDENCE OF: MR. ISHAN KAUSHIK FACULTY OF DMS

SUBMITTED BY: SHAMIM AHMAD Roll No. 0909970081 MBA- 4TH SEM (2009-11)

HARLAL INSTITUTE OF MANAGEMENT & TECHNOLOGY

8, Institutional Area, Knowledge Park-1, Grater Noida-201306 (U.P)

INDEX
1. PREFACE 2. INTRODUCTION 3. REVIEW OF LITERATURE 4. OBJECTIVE OF THE STUDY 5. RESEARCH METHODOLOGY 6. LIMITATION OF THE STUDY 7. FINDING AND ANALYSIS 8. SUGGESTION & RECOMMENDATION 9. CONCLUSION 10. QUESTIONNAIRE

PREFACE
My research works are integral part of MBA (IV Sem) and submitted to HIMT, (Affiliated to GBTU, Lucknow). During the process a student gets an opportunity to study the market scenario and set the practical aspects of theory which makes the concept clear. This is an outcome of the research work and study of market that undertaken on the subject related to An analysis of Soap Industry". This makes Indian as one of the ideal market for soaps and other cleaning products. The penetration of bathing soaps is 98% of all households. The research study shows that the per capita consumption of bathing soap is 513 gm. So there is a very big market

for soap in India. The total turnover of soap or market in India is 54 lakhs ton per annum and is increasing at the rate of 5% per annum. My research work is absolutely significant result for soap industry and they are welcomed to find out companys soaps are in more demand these days by comparing

various factors. It is to find out the basic and all the other factors, success and their facing present problems regularly. The research work is based on analysis of various promotional tools used by the different companies manufacturing soaps. FMCG refers to consumer non-durable goods requirement for daily or frequent use. Typically, a consumer buys these goods at least once a month. The sector covers a wide gamut of products such as detergents, soaps, toothpastes shampoos, creams, powders, food products, confectioneries, beverages, cigarettes. Individual items are of small value. But all FMCG products put together account for a significant part of the consumers budget. The consumer keeps limited inventory of these products and prefers to purchase them frequently, as and when required. Many of these products are perishable. The consumer spends little time on the purchase decision. Rarely does he/she look for technical specification. Brand loyalties or recommendations of reliable retailer/dealer drive purchase decisions. Trail of a new products i.e. brand switching is often induced by heavy advertisement, recommendation of the retailer or neighbors/friends. These products cater to necessities, comforts as well as luxuries. They meet the demands of the entire cross section of population. Price and income elasticity of demand varies across products and consumers.

INTRODUCTION
Indian is one of ideal market for soaps and other cleaning products. The penetration of bathing soaps is 98% of all households. The research study shows that the per capita consumption of bathing soap is 513 gm. So there is a very big market for soap in India. The total turnover of soap or market in India is 54 lakhs ton per annum and is increasing at the rate of 5% per annum. FMCG refers to consumer non-durable goods requirement for daily or frequent use. Typically, a consumer buys these goods at least once a month. The sector covers a wide gamut of products such as detergents, soaps, toothpastes shampoos, creams, powders, food products, confectioneries, beverages, cigarettes. The consumer keeps limited inventory of these products and prefers to purchase them frequently, as and when required. Many of these products are perishable. These products cater to necessities, comforts as well as luxuries. They meet the demands of the entire cross section of population. Price and income elasticity of demand varies across products and consumers.

MAJOR PLAYERS IN THE SOAP MARKET: Hindustan Unilever Limited Godrej Nirma Procter & Gamble Johnson & Johnson Wipro Colgate Palmolive Reckitt-Benckiser

The soap market can be divided into three categories: CATEGORY Premium Popular Economy/Functional PRICE > Rs. 15 Rs. 8-15 < Rs. 8 WEIGHT 75 gm. 75 gm. 75gm.

1. Economy/Functional soaps: It comprise of 35% of the market. The red carbolic soaps: cakes are low price germ killers. The names of few of the functional brands are Nirma bath and Lifebuoy. The prices of this brand soaps are less than Rs. 8 for 75 gms. 2. Popular soaps: The biggest share in the soap market, popular soap has a market soaps: share of 55%. The price of this category of soaps ranges from Rs 8-15 for a 75 gm cake e.g. Liril, Cinthol, Rexona. Each soap wants to posses a special benefit like fragrance, freshness etc. 3. Premium soaps: It comprises of 10% of the total market. Premium brands are priced soaps: above Rs.15 for 75 gm cake. People are willing to pay more for this category of soap and several other brands have special relationship and people. Some of the premium soaps include : Pears, Dove, Johnson Baby soap.

CATEGORY WISE MARKET SHARE OF SOAPS

10% 35%
Economy(<Rs.8) Popular (Rs. 815) Premuium(> Rs. 15)

55%

The above graph shows that the Economy soaps constitute 35% of market share, Popular soaps constitute major portion of market share i.e. 55% and Premium soaps constitute only 10% of market share.

LITERATURE REVIEW
The importance of consumer sales promotion in the marketing mix of the fast moving consumer goods (FMCG) category throughout the world has increased. Companies spend considerable time in planning such activities. However, in order to enhance the effectiveness of these activities, manufacturers should understand consumer and retailer interpretations of their promotional activities. A study of these perceptions will reveal their preferences, their knowledge, and motivations. In this project, an attempt has been made to examine the nature of sales promotion activities in toilet soap category in India, study retailer perceptions with respect to these activities. According to Kotler sales promotion are as: Sales Promotion consists of a diverse collection of incentive tools, mostly short-term designed to stimulate quicker and/or greater purchase of particular products/services by consumers or the trade. Roger Strang has given a more simplistic definition i.e. Sales promotions are short-term incentives to encourage purchase or sales of a product or service. Hence, any forms of incentives offered for short period either to trade or consumers are considered as sales promotion activities. The industry had witnessed many innovative sales promotion activities in the recent past. Numerous factors were responsible for such a phenomenon: One of the reasons being that the market being sluggish, companies were trying to increase market share in stagnant to declining (volume terms) market in order to retain consumers, to encourage switching, to induce trials and liquidate excessive inventories. Another reason possible was that with the presence of so many brands the competition had increased severally leading to fight for

market share and shelf space. Inflationary trend had made both the consumer as well as trade deal prone. Hence, sales promotion activities in toilet soap industry posed a very interesting study and consumer and retailer perceptions thereof. Objectives of Sales Promotion: 1) To increase sales volume by inducing customers to buy more. 2) To attract new customers to try the product 3) To encourage sales in off season. 4) Educating the consumers about new products, new uses of the existing products. 5) Building the brand loyalty for the product among the customers. 6) To create good public image of the product & the firm.

TECHNIQUES OF SALES PROMOTION:

1) FREE SAMPLES : one of the most popular sales promotion techniques include free samples of products to selected people in order to popularize their products. Distribution of sample is popular in case of Books, Drugs, Personal Care items likeSoaps, Creams etc. 2) PRICE-OFF OFFER :such kinds of offers are generally given during off seasons eg. on woolen clothes. 3) GIFT SCHEMES: gifts are offered along with purchase of products/services. Most of times gifts are based on quantum of purchase or value of purchase. 4) CONTESTS : contests are organized for consumers, salesman, dealers to encourage: (i) (ii) the customers to buy more. the salesman to effect as much sales as possible.

(iii)

the dealers to order higher quantities.

For e.g. for a customer, writing a good slogan for a product may enable him to get a free trip to spend holidays at the destination of his/her choice. 5) FREE DEMONSTRATION : free & live presentation of the products helps to understand the product better & its working more clearly, since after a demonstration, normally a customer feels convinced and opts for the purchase. Other sales promotion tools include: Discount Cupons, Displays, Fairs & Exhibitions.

RESEARCH METHODOLOGY
RESEARCH MEANING Research is an art of scientific investigation. According to Redmen and Mary defines research as a syst ematic effort to gain knowledge.

Research methodology is way to systematically solve the research problem. It is a plan of action for a research project and explains in detail how data are collected and analyzed. This research study is a descriptive research study. RESEARCH DESIGN A research design is a plan that specifies the objectives of the study, method to be adopted in the data collection, tools in data analysis and hypothesis to be framed. A research design is an arrangement of condition for collection and analysis of data in a manner that aims to combine relevance to research purpose with economy in procedure. NATURE OF DATA Primary data The primary data are collected from the employees of HIDESIGN through a direct structured questionnaire. Secondary data Company profiles, websites, magazines, articles were used widely as a support to primary data.

SAMPLING SIZE AND TECHNIQUE Size of the sample It refers to the number of items to be selected from the universe to constitute as a sample. In this study 50 employees of HIDESIGN in Puducherry was selected as size of sample. Sample design The sampling technique used in this study is simple random sampling method. This method is also called as the method of chance selection. Each and every item of population has equal chance to be included in the sample. Population design The population of this study is the total employee in the company. It is finite population. There are four production centers for the organization for this study I have taken only employees in one production centre.

STATISTICAL TOOLS USED To analyze and interpret collected data the following statistical tools were used. 1) Percentage method 2) Weighted average method 3) Chi-square analysis 4) Correlation 5) Regression Percentage method The percentage is used for making comparison between two or more series of data. It is used to classify the opinion of the respondent for different factors. It is calculated as No. of respondents favorable*100 Percentage of respondent = Total no of respondents

Weighted average method The weighted average method can be calculated by the following formula. This tool is used to find the rank given by the respondents to the welfare measures. It can be calculated as XW = WX / X

Here XW represents the weighted average X represents the value of variable W represents the weight given to the variable. Chi-square analysis Chi-square analysis in statistics is to test the goodness of fit to verify the distribution of observed data with assumed theoretical distribution. Therefore it is a measure to study the divergence of actual and expected frequencies. The formula for computing chi-square is as follows. Chi-square = {(O-E)2 / E}

The calculated value of chi-square is compared with the table of chi-square for the given degrees of freedom at the specified level of significance. If the calculated value is greater than the tabulated value then the difference between the observed frequency and the expected frequency are significant. The degrees of freedom is (n-2) where n is number of observed frequencies and in case of contingency table the degrees of freedom is (C-1) where C is number of columns and R is number of rows. It is used to find the relation between communication in work place and work satisfaction. It is used to find the relation between welfare satisfaction and work satisfaction it is used to find the relation between experience of respondents and work satisfaction (R-1)

OBJECTIVES OF THE STUDY

To do a comparison between the soaps companies and find out : (i) (ii) (iii) which companys soaps are more used by people. the numerous factors which influence the consumers purchase behavior towards HUL, Godrej, Nirma, Wipro, Johnson & Johnson soaps. consumers liking-disliking ,their awareness regarding the soaps & sales promotion schemes given on them by the above mentioned companies. To compare soaps industry on the basis their current sales promotion schemes. To assess which companys soaps are popular (i.e. used more) among the different categories of soaps: Economy, Popular and Preumium. To get an insight into retailers views regarding the sales of soap industry and sales promotion schemes on them.

FINDINGS & ANALYSIS

Most of the people prefer to use HUL soaps because HUL offers the best quality soaps , it manufacturers huge variety of soaps as compared to Godrej, Nirma, Wipro, J&J., and HUL soaps vary according to prices, quality, fragrances etc. from which people can easily select soaps according to their income & choice. HUL is the only company which belongs to all the 3 categories of soaps: Economy.Popular,Preumium whereas Godrej soaps belongs to popular category and Wipro & J&J soaps belong to Premium category Nirma Soaps like Nirma, Nima are used more by lower income group because they can afford to buy them. Middle income group prefer to use Lux, Cinthol and Upper income group prefer to use Dove, Pears. Earlier J&J was the only company which targeting small babies as their market but now Wipro Baby Soft Soap is also there in the market but still majority of people use J&J Baby soap. Talking about the awareness level, people are more aware about HUL, Godrej ,J&J soaps as compared to Nirma & Wipro Soaps. Godrej, Nirma, Wipro soaps are not able to attract people due to limited variety, bad quality. Wipro Baby soft soap is not available at most of the shops thats the reason only few people know about it. Brand Loyalty is seen more in case of soaps like Lux, Dove and less in case of soaps like Santoor, Nirma.

Popular soaps among females are lux,dove,pears and among males are cinthol,hamam,pears.

HUL is the only company which gives the schemes like price-off, Bonus Pack, Free Gifts etc. the most on its soaps (specially on Lux) as compared to other companies manufacturing soaps and such schemes are given least on Nirma & J&J soaps.

LIMITATIONS OF THE STUDY

Sample size was small so the findings cannot be generalized. Analysis of data obtained from the questionnaires was done on the assumption that the respondents gave correct information. Time-Period for the conduct of survey was short. Some of the questions in the questionnaire were left unanswered due to either lack of time or due to lack of knowledge.

SUGGESTIONS & RECOMMENDATIONS

Prices of soaps like Dove, Pears (HUL soaps) and J&J Baby soap should be reduced as everyone cannot afford to buy them.

Companies Like Nirma, Godrej, Wipro should launch more variety of soaps & should try to improve the quality of there soaps as people are not satisfied with the quality of these soaps.

J&J apart from targeting the small babies should target age group people also. Sales Promotion Tools like price off, contests etc. should be more in case of J&J soaps, Nirma soaps.

Although large no. of people buy HUL soaps but still some are not satisfied with the quality of soaps like Dove, Breeze so company should give due consideration to it to maintain its position in the soap market.

People are less aware about Wipro Baby Soft soap. More awareness should be created about it through advertising in T.V, radio, newspapers. Also, the retailers should promote the soap to the consumers when they come to purchase the soaps.

HUL should also launch a special soap for small babies as it does not manufacturers any soap specially targeting them.

Some new soaps should be introduced in the market targeting males as soaps like Park Avenue, Denim are not within the reach of everyone.

CONCLUSION

It is concluded that the soap industry is one of the oldest Fast Moving Consumer Goods (FMCG) industry in India. It is among the highest penetrated category within FMCG sector reaching an estimated 95% urban and 87% of the rural households. The main characteristic of the soap industry: severe competition and high level of brand proliferation . Heat and dust are integral part of Indian climate. So, there is a big market for soaps in India. HUL is the market leader in the soap industry with 59%.share. According to the comparison conducted on various parameters, HUL soaps occupies the first position, Godrej occupies the second postion and Wipro occupies the third position, fourth position is occupied by J&J and Nirma soaps are least preferred among the all five. HUL soaps are most demanded because of its good quality, awareness, huge variety, company name etc. and no other company whether it is Godrej, Nirma, J&J, Wipro could compete with it because people are less aware of the soaps of these companies, their bad quality, limited variety. Common Sales Promotion tools offered on soaps are Price-off and Bonus Pack and HUL is the only company which offers them the most Thus, it can be said that HUL rules the soap market as it has made a good position in every aspect whether it is quality, price, variety so, in order to compete with it, Godrej, Nirma, Wipro, J&J should take care of the above factors.

BIBLIOGRAPHY
BOOK: Gupta, C.B., Business Studies, Tata McGraw Hill Publications, 3rd Ed.

NEWSPAPERS The Times of India The Hindustan Times The Economic Times The Hindu Business Standard Line

WEBSITES:

* http://www.yahoo.com * http://www.google.com * http://www.hul.com *http://www.godrej.com *http://www.nirma.com *http://www.wipro.com *http://www.johnson&johnson.com *http://www.cinthol.com

QUESTIONNAIRE-1 (From consumers point of view)

Dear Respondent, I am a BBA student of BIT and conducting a survey to determine the purchase behavior of people towards different soaps of HUL, Godrej, Nirma, Johnson & Johnson & Wipro. The survey is for academic purpose only; it will not be misused for any other work. Your participation will be highly encouraging in the successful completion of the research work.

Q1. Which Bath soap(s) do u purchase/use? 1) Lifebuoy 2) Breeze 3) Dove 4) Hamam 5) Liril 6) Pears 7) Rexona 8) Lux 9) Godrej No.1 10) Godrej Fairglow 11) Cinthol 12) Johnson & Johnson Baby soap If you have selected more than 1 option, which soap do you use the most? _______________________ 13) Nirma 14) Nima 15) Santoor 16) Chandrika 17) Others (specify)__________ _______________________

Q2. Do you know, the soap(s) that you have selected in the above question is a brand of which company? 1) YES 2) NO

If YES, tick the appropriate option 1) Hindustan Liver Limited (specify the soap name) _____________________________ 2) Godrej (specify the soap name) _______________________ 3) Nirma ( specify the soap name) ____________________________ 4) Johnson & Johnson (specify the soap name) _________________________ 5) Wipro (Specify the soap name) ___________________________________

Q3. Which of the following factors influences you to purchase the soap(s) that you have selected in Q1? ( Mention the names of soap(s) also, if you have selected more than 1 Q1) FACTORS: 1) Price (write Y if your ans is yes) 2) Availability 3) Brand Name 4) Sales Promotion Scheme (gifts, price off etc. ) 5) Fragrance 6) Quality 7) Advertisements 8) Packaging 9) Suitable for skin 10) All of the above SOAP(S) NAME :

Q4. Are you a brand Loyal? Write Yes/ No _________ ( Mention the soap name) _____________ If NO, what are the reasons for Brand Switching? 1) Variety of other soaps available 2) Packaging 3) Climatic Conditions 4) Price 5) Sales Promotion Schemes 6) Fragrance 7) Quality

Q5. Is/Are there any soap(s) that you would never like to purchase again or you had bad experience with? Write Yes/ No ________________ If Yes , specify the soap(s) name & Reason(s) _______________________________ ______________________________________________________________________

Q6. Which of the following soaps you have not tried even once?

1) Lifebuoy 2) Breeze 3) Dove 4) Hamam 5) Liril 6) Pears

7) Rexona 8) Lux 9) Godrej No.1 10) Godrej Fairglow 11) Cinthol 12) Johnson &

13) Nirma 14) Nima 15) Santoor 16) Chandrika 17) Others (specify)__________ _______________________

Johnson Baby soap

Reasons : 1) Never Heard 2) Brand Loyal 3) Price 4) Packaging 5) Bad word of mouth 6) Didnt attract 7) Limited Variety. Q7. (i) Does the celebrity advertising the soap(s) also play a role in converting your attention into purchase? Write Yes/ No/ Sometimes ________________ (ii) If Yes/ Sometimes, which soaps advertisement attracts you the most? _________________________________________________________________ Q8. Mention names of any 5 soaps that you can recall easily? __________________________________________________________ Q9. If you are having a child in your family between 1-10 years, which soap is used for that child? 1) J& J Baby Soap 2) Wipro Baby Soft Soap

Q10. Which of the following awareness sources provides you more information about the soap(s) that stimulates you to purchase the same? ( Mention the soap(s) name, if you have selected more than 1 option in Q1)

SOAP AWARENESS SOURCES: 1) Word of Mouth ( Write Y, if is there) _______ 2) Retailers 3) Advertisements 4) Others (Specify) ____________ _______ _______

SOAP(S) NAME:

Q11. (i) Which Sales Promotion Schemes on soap(s) do you prefer the most? 1) Price Off 2) Contests 3) Free- Gifts 4) Free- Samples (ii) Can you name any above mentioned schemes on soaps ( not necessary the current ones) which leads to purchase the same or that you still remember? _________________________________________________________________ __________________________________________________________________ Q12. Any suggestions for the soap(s) that you use? SUGGESTIONS 1) More fragrances should be introduced (Write Y, if it is there ) 2) Decrease in price 3) Should offer Sales promotion Schemes 4) Quality should be improved 5) No suggestions SOAP(S) NAME

Personal Information:
1) Name of the Respondent : ____________________________ 2) Place : _________________________ 3) Age Group: (i) 11-20 years (ii) 21-30 years (iii) 31-40 years (iv) 41- 50 years (v) above 50 years 4) Gender : (i) Male (ii) Female 5) Martial Status : (i) Married (ii) Unmarried 6) Occupation Status : (i) Student (ii) Service (iii) Business (iii) Housewife (v) Retired 7) Family Income : (i) 1-2 Lakhs p.a (ii) 2-3 Lakhs p.a (iii) > 3 Lakhs p.a.

QUESTIONNAIRE-1 (From Retailers point of view)

Dear Respondent, I am a BBA student of BIT and conducting a survey to determine the sales of which company manufacturing soaps : HUL, Godrej, Nirma, Wipro and J&J is high, low, sales promotion offers like price-off, contests etc. given by the above mentioned companies on their soaps. The survey is for academic purpose only; it will not be misused for any other work. Your participation will be highly encouraging in the completion of the project. Q1(i) What percentages of the following companies soaps are sold at your shop? HUL Soaps 1) Lifebuoy 2) Breeze 3) Dove 4) Hamam 5) Liril 6) Pears 7) Rexona 8) Lux (ii) Reasons for high/low sales: 1) More/Less Aware 2) Good/Bad Quality 3) Price (High/Cheap) 4) Availability Godrej Soaps 1) Godrej No. 1 Nirma Soaps 1) Nirma Wipro Soaps 1) Santoor 2) Chandrika J&J Soaps 1) Johnsons Baby Soap

2) Godrej Fairglow 2) Nima 3) Cinthol

5) Suitable/Not suitable for skin 6) Variety/ Limited variety of soaps 7) Company Name Q3. Sale of which soap is highest and lowest at your shop? 1) Highest : _____________________ 2) Lowest : _________________________

Q4. Rank the company from 1-5 ( 1 being the most important and 5 being the least Important ) whose soaps you like to sell the most/least at your shop? 1) HUL ________ 2) GODREJ __________ 5) J&J _________ 3) Nirma _________

4) Wipro ________

Q5. On which companys soaps, the offers like price-off, contests, free gifts, free samples, Packs etc. are given the most? (i) HUL 2) GODREJ 3) NIRMA 4) WIPRO 5) J&J

On which soap these schemes are given the most and least _______________________ _______________________________________________________________________ Q6. Which soap(s) is/are in more demand these days on which some above mentioned schemes are given? _________________________________________________________________ _________________________________________________________________

Personal Information:
1) Name of the respondent : _________________________

2) Name of the shop : _____________________________________ Address of the shop : ___________________________________