Product Life Cycle

Hindustan Unilever Limited

Hindustan Unilever Limited (HUL) is India's
largest fast moving consumer goods company,
with leadership in Home & Personal Care
Products and Foods
Mission “Adds vitality to life”
Parent Company-Unilever with 52.10% equity
Its combined volumes of about 4 million tonnes
and sales of Rs.13,718 crores.
The stages through which individual products

develop over time is called commonly known

as the "Product Life Cycle".

 Sales and
Profits ($) Sales

Profits

Time
Product Introduction Growth Maturity Decline
Develop-
ment

Losses/
Investments ($)
 HIGH LOW

HIGH Rapid Skimming Slow Skimming

P
R
Pond’s Age Eg:-Public Airlines
Miracle
I
C
E Rapid Slow Penetration
LOW Penetration Eg:-Local
Staple
goods
PROMOTION
Advertising & Promotional expenditures are at
their highest ratio to sales- to rapidly increase
customer awareness of the product and to
target the early adopters.

Higher costs coupled with a low sales volume

usually make the introduction stage a period
of negative profits.
 Decision has to be taken on being a pioneer or
not
Pioneer advantage.
 Brand Recall - brand synonymous with the
new category.
 Eg:-Dettol(=Antiseptic)
Product - one or few products, relatively undifferentiated

Price –
 High -Skim price strategy- High profit margins to
recoup development costs quickly
 Low- Penetration Pricing strategy to gain market share
rapidly.

Distribution - Distribution is selective and scattered as the

firm commences implementation of the distribution plan.

Promotion - Promotion is aimed at building brand

awareness
Lifebuoy was sold in India as early as 1895

It was officially launched and marketed from

1935.

It was the largest selling soap brand in the

world with sales of Rs 5 bn and sold
approximately 2 million soaps a day (as on
2002).
Initial Positioning- in the Health and Value
platform.

Initial Segmentation-Carbolic Soap

Its ads reiterated the message that Lifebuoy

washed away germs and kept one protected
and healthy.
It’s target segment was Males-A Masculine
brand.

The soap was brick red and carbolic ingredient

with a unique smell (chryselic perfume)

This distinguished itself from other feminine

brands.
The campaigns showed footballer players and
athletes using the soap and the jingle followed
jingle followed "
thandurusti ki raksha
kartha hai lifebuoy, lifebuoy hai
jahan thandurusti hai vahan". -Male
soap in health care
Product- undifferentiated red brick with
cryselic smell
Segmentation:- Carbolic soap segment
Positioning:-Masculine brand in health and
value platform
Market Strategy:-High Penetration
Initial Price & Market share- had a 21% market
share in the overall soap market
"It is the biggest and comprehensive relaunch
of any of our brands. Lifebuoy which has
remained unchanged for the last 107 years is a
completely new product since January 2002,"
said Mr Sanjay Dube, Category Head - Mass
Market Soaps and Detergents, HLL.
The growth stage is a period of rapid revenue
growth.

Sales increase as more customers become aware of the

product and its benefits and additional market
segments are targeted.
Product - New product features and packaging
options; improvement of product quality.

Price - Maintained at a high level if demand is

high, or reduced to capture additional customers.

Distribution - Distribution becomes more intensive.

Promotion - Increased advertising to build brand

preference.
Intro:-
Launched in 1975, this brand is the first gel toothpaste aiming at
the youth segment.

HLL through CloseUp have created and owned a segment for

itself.

CloseUp was a disruptive brand that changed the structure of

toothpaste market in India.
With the red colour and smart advertising , it

forced the market leader to change its strategy

and launch a gel variant.

The customer insight was that people are
conscious about their breath and want to get
close with each other with confidence.

Based on this insight the brand was positioned

on the Fresh Breath platform
The campaign was executed showing "Happy
couples having fun together".
Even film Theatres had corners called

as “Close Up Corners” ".

Close Up have used films and filmi songs to
appeal to the Indian youth.

Close Up was the first brand to introduce the "

Self Check" of breath.
The famous " HA HA" was the idea of Close Up
introduced in year 1987
Positioning- Youth brand on fresh breath
platform
Segmentation- Gel variant
Promotional Campaign- “Get Closer with
Confidence”
Market Share- 13% alone and along with
Pepsodent it accounted for 36% market share,
giving tough competition to Colgate
• Sales continue to increase at a slower pace.

• Advertising expenditures will be reduced.

• Competition may result in decreased market share and/or prices.

• The competing products may be very similar at this point,

increasing the difficulty of differentiating the product.

• The firm places effort into encouraging :-

 competitors' customers to switch,
 increasing usage per customer, and
 converting non-users into customers.

• Sales promotions may be offered to encourage retailers to give the

product more shelf space over competing products.
Product - Modifications are made and features are
added in order to differentiate the product from
competitors.

Price - Possible price reductions in response to a

price war.

Distribution - New distribution channels to avoid

losing shelf space.

Promotion - Emphasis on building of brand loyalty.

Close Up found that its mono-attribute focus is
losing the sheen

Many market players

 Crest-by P&G
 Colgate & Pepsodent wars
 Cliden and a brand by Ajanta group
Crest, by P&G- 135gm pack for Rs21-25
LG Care-Cliden toothpaste
Toothpaste by Ajanta-200gm pack for Rs20/-
Combipack of Anchor white toothpaste &
toothbrush- Rs 25/-
Pepsodent & Close up-200gm pack-40Rs/-
In Maturity phase as per ORG-Marg, Close-Up

has a 17.5 per cent value share in the Rs 1,400-

crore toothpaste market.

 New focus on 3 attributes : Fresh breath, White
Teeth and Strong Teeth.
CloseUp With Vitamin and Flouride – offer
oral care
3 Variants- Oxy fresh, Eucalyptus Blue, Lemon
variant
 “Smile Ad” & “Kya aap Close up karte hain”-to
promote brand loyalty & emphasize brand
identification in heightened competition.

 The 'Smile King' commercial reflected the

confidence of today's youth.

Launch of www.closeupuniverse.com- A
website for youth, again reinforcing that it is a
youth brand.
Eventually sales begin to decline as the market

becomes saturated, the product becomes

technologically obsolete, or customer tastes

change.
Maintain the product in hopes that competitors
will exit. Reduce costs and find new uses for
the product.
Harvest it, reducing marketing support and
coasting along until no more profit can be
made.
Discontinue the product when no more profit
can be made or there is a successor product.
Product - The number of products in the product line
may be reduced. Rejuvenate surviving products to
make them look new again.

Price - Prices may be lowered to liquidate inventory of

discontinued products. Prices may be maintained for
continued products serving a niche market.

Distribution - Distribution becomes more selective.

Channels that no longer are profitable are phased out.

Promotion - Expenditures are lower and aimed at

reinforcing the brand image for continued products.
However, most of the companies go for
BRAND REVIVAL .
On a positive note, the whole new version of
the product with new marketing strategy is
used.
Thus, under the initial name, a completely new
formulation is developed.
Hence, very few products may or may not be
wiped off.
The soap market in India was fairly sluggish in
2001, declining by 9-10 per cent. Lifebuoy's
decline exceeded that of the overall market

Lifebuoy has been declining by 15-20 per cent

in volume terms.

The decline was partly on account of the

sluggish growth in the rural market, which
accounts for 50 per cent of soap demand.
HLL launched Lifebuoy
Active , Lifebuoy
Extra Strong in during
the second half of
2001.
OLD LOOK NEW LOOK
Lifebuoy is no longer a carbolic soap with
cryselic perfume,
It is a toilet soap with a different `health'
fragrance. With this launch, the carbolic
segment has been wiped out.

New perfume, formulation, size and shape.

From an earlier focus on men, the focus has
shifted to family with the message that
Lifebuoy is for effective protection from germs
that cause health problems.

Focus on Men Focus on family

Distribution- It has touched nearly 100 million

Indians across 44,000 villages

HLL has identified 8-9 key States for
commencing its rural contact programme
wherein the CONCEPT OF HYGIENE will be
highlighted.
On 15 October 2008 Lifebuoy
with members of the Global
Public Private Partnership for
Handwashing (PPPHW) –
including UNICEF promoted
a single life-saving message:
wash hands with soap.
It was conducted in 23
countries.
The campaign, called
Swasthya Chetna, or health
awakening, is the largest
rural health and hygiene
education program ever
undertaken in India.

It is to educate 200 million

Indians – 20% of the
population - to wash their
hands with soap after
defecating and achieve this
goal within five years.
 Products do not have such a predictable life and
the specific life cycle curves followed by different
products vary substantially.

Consequently, the life cycle concept is not well-

suited for the forecasting of product sales.

If sales peak and then decline, managers may

conclude that the product is in the decline phase
and therefore cut the advertising budget, thus
precipitating a further decline.