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Surface Care Supremacy of Harpic & Road Ahead
A Case Analysis Contest - The Case
In association with
The Marketing Club of MDI
Harpic, the leading brand for toilet cleaning (also known as lav care) in India had witnessed phenomenonal growth in recent years beginning early 2000’s. Launched in India in 1984, Harpic created the product category 25 years ago. Being the pioneer in the Toilet cleaner market commanding a share of about 80%, the brand growth has paralleled the growth of the toilet cleaner product category in India. The heady growth seen by this product category during five years of 2002 to 2007 had attracted the attention of the competition which had started to become very active and gave much more focus to their products and marketing efforts. Fresh competition from international players in recent times has also made its entry in the promising Indian home cleaning care market. On the other hand, the growth of the product category had considerably slowed down in the last couple of years. In the face of these dramatic changes in the competitive environment, the brand team of Harpic was brainstorming in September, 2009, to chalk out a strategy for its future growth. The dilemmas being faced were typical for a brand leader. It had to prioritize its options and decide what directions to give to its marketing strategy, amongst defending its falling market share, working towards increasing the product penetration levels, increasing usage and consumption by existing users, or taking some other new initiatives, while at the same time ensuring that its marketing mix efforts and allocated investments were optimized for maximized returns for the brand’s growth.
*Unless otherwise stated, all data given in the case refers to research done by Research International (Consumer Survey) and AC Nielsen (Market Data), supplied by Reckitt Benckiser India Ltd
This case is prepared by Prof. Vinod Kalia of Management Development Institute, Gurgaon for the Harpic case study contest organized by Reckitt Benckiser India Ltd. in association with MDI‐MarQuity. The case is not intended to serve as a source of primary data, or effective or ineffective management. The author would like to thankfully acknowledge inputs from the brand team of Reckitt Benckiser India Ltd. and Mr. Parag Raheja, Mr. Saurabh Sharma and Ms. Pallavi Sud, students from MDI PGPM class of 2010
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Robin powder. once refined. 535m. Antiseptics. The company has operations in 60 countries. Reckitt and Sons took over the company and soon Harpic became a household name in Britain. Cherry Blossom. In 1932. BRAND HARPIC Harpic’s origin dates back to 1920. Disprin. Surface care. more than 50% of the housewives in Britain had bought this brand. Pest control. The year 2008 saw the company achieve very strong financial results despite increasingly turbulent economic conditions globally. Reckitt Benckiser Plc came into being with the merger of Reckitt & Colman Plc with Benckiser NV in 1999. (Refer annexure 1a for image of introductory Harpic bottle) Page 3 of 23 . Mortein.5 billion last year. had an equally devastating effect on germs and stains. Amongst its many well-known brands are Dettol. world's No.COMPANY BACKGROUND Reckitt Benckiser India Ltd (RBIL) is a fully owned subsidiary of Reckitt Benckiser Plc.l Company in household cleaning. RBIL distributes all its products through its common distribution channel. Most of these brands are either number 1 or number 2 in their respective categories in India. post World War 1. following a number of years of strong growth. Shoe care. etc. Harpic.563m and adjusted operating profit was up by 15% to £l. and the quality of its employees and their leadership. it was this act of serendipity that led to the invention of "Harpic". The channel is managed by a well-structured sales force. This performance. Net revenues grew by 13% to £6. which has a wide and deep reach in the Indian market and is a key strength of the company. a brand name derived from the inventor's name Harry Pickup. when a British gentleman named Harry Pickup found that surplus explosive bye products. By the Sixties. The Indian subsidiary RBIL manufactures and markets a wide range of products in Personal care. was testament to the global strength of the Company's strategy and execution. Colin. responsible for achieving sales for the entire product portfolio of more than 150 Stock Keeping Units (SKUs). sales in 180 countries and has had net revenues in excess of $6. Fabric care and other categories. Thus. Lizol.
and she shouldn’t spend on Harpic just to save some time. Harpic is now sold in over 47 countries worldwide on the platform of "Powerful Cleaning". detergents. Launched in India in 1984. high income users). cistern blocks. Page 4 of 23 . wipes and tablets. In such a backdrop where underperformance of toilet cleaner proxy products was widely accepted. bleach and whole lot of other proxy products.The brand has made a long journey since its humble beginnings. into their toilet to clean the same. after washing clothes or mopping floor. Many consumers believed that Harpic doesn’t clean any better compared to phenyls or acids. Consumer research indicated a number of widely believed consumer perceptions which were coming in the way of Harpic’s acceptance by consumers. It is positioned as the expert in Lavatory Care and offers a complete range of lavatory care products such as liquid toilet bowl cleaners. Traditional "acid" was thought as the best cleaning agent as it gives visible fumes during usage which creates an effect of powerful cleaning/germ killing. Consumers were using a range of substitute products such as plain water. In automatics segment. phenyl. and so on. the brand offers Harpic Power and Harpic Fresh. toilet bowl blocks. Harpic was perceived to be a very expensive product (when Harpic was launched. same amount of Harpic liquid cost the consumer at least double that of phenyl and about five times that of acid). acids. the brand experienced a slow acceptance by consumers in the initial years. They believed that reusing the detergents was an economical way to clean the toilets. Harpic was perceived as a premium product only for the use of working women or busy house wives who did not have sufficient time to clean the toilets by other more economic means (the advertising campaigns at that time also reinforced such association with high education. was part of her job. Many consumers were habituated to pouring residual detergent water. In liquid cleaner segment. They had also resigned themselves to the sub-standard cleaning achieved through these methods as they thought that they couldn't get cleaner toilets any other way. traditional housewife felt that household cleaning. it offers Harpic Flushmatic and Harpic Hygienic (Refer annexure 1b for current Harpic range of products) HARPIC IN INDIAN MARKET Harpic is the brand which changed the way toilets were cleaned in India. including toilet cleaning.
The years 2002 to 2007 were the golden years in the journey of Harpic. Having created a strong association for Harpic in consumers’ mind with toilet cleaners. the company went ahead aggressively to build the category and create new users.The brand thus had the challenge of educating consumer about effectiveness of Harpic and its utility for every household. with constantly expanding coverage. the brand started mass communication in the year 1988 . RBIL offered to replace the toilet free if Harpic’s superior cleaning power was not proven in the demonstration.whereby the product efficacy was actually demonstrated to the consumers and its cleaning superiority highlighted (against the generic cleaners that were primarily used). and was continued over for a long time. In real scenarios. potential consumers were contacted and a challenge thrown to test Harpic’s cleaning power. the penetration level more than doubled from 8% to 19%. In early 2002. Thus came the "Harpic challenge" campaign which intended to startle the consumers with surprisingly good results. India became the biggest market for Harpic across the globe. 150 crores in 2007. The campaign became highly successful.with the TV Commercial of Harpic educating and informing consumers about the need for hygiene in the toilet and bathroom (being equally important as the need for hygiene in other rooms of the house). Expanding its ambitions to greater heights. The campaign proved successful with sales picking up sharply. The brand was consistently positioned as an "All Powerful" cleaning alternative to traditional products and Harpic became synonymous with toilet cleaners. In terms of volumes. thus helping to build the brand through the eighties. RBIL started to painstakingly build the Harpic brand with the help of Door to Door Consumer Contact program . Page 5 of 23 . a new advertising campaign was tested in the South market to establish the superior performance of Harpic over the proxy products. and the company launched the TV Commercial in the entire national market in September 2002. crossing Rs. The product penetration in all urban households started to climb rapidly. The gross sales for the toilet cleaner product category grew almost five times in the same period. and in a matter of five years.
HUL has recently launched Cif (a specialist surface cleaner) which has been positioned as a cream with micro particles which does tough cleaning with minimum effort. 180 crores in 2008) has been witnessing high growth rates of about 20% per annum in both value and volume terms for last few years (refer annexure 2 and 3). The toilet cleaners market is the largest and had a sale of Rs 180 crores in 2008. Reckitt Benckiser which is the market leader in Lav care has Harpic brand in this segment while Lizol in the floor cleaning segment. Hindustan Unilever Ltd (HUL) entered this market with the brand Domex which was an APDC (all purpose disinfectant cleaner) that can be used on the floors. The market is dominated by Harpic which has a share of about 80% by value. and the specialist surface cleaners is the smallest with sales revenues of Rs. while other players have different brands in different segments. The surface cleaner category has reached a penetration level of 55% of urban Indian households. in the kitchen sink. 35 crores in 2008. In specialist surface cleaners it has a brand called Colin. for wash basins and in the toilet. floor cleaners and specialist surface cleaners for glass etc. a liquid spray product used for cleaning glass. Henkel India also has a brand called Bref which is present both in lav care as Bref toilet cleaner and in the specialist surface cleaner as Bref power cleaner.5%) and Sanifresh Page 6 of 23 . Indian FMCG major Dabur India Ltd operates with two brands in the surface cleaning categoryDazzl which is a disinfectant floor cleaner and Sanifresh which is a specialist toilet cleaner available in two variants Sanifresh shine and Sanifresh extra power. and the balance market is mainly shared by Domex from Hindustan Unilever Ltd (10. some present in various segments with the same brand. floor cleaners is the next biggest market with sales of Rs 75 crore. INDIAN LAV CARE MARKET The total market for Lav Care products in India (Rs. A relatively new entrant in surface cleaning category is S C Johnson & Co. with a single brand Mr Muscle which is positioned as a multipurpose cleaner suitable for toilet and floor cleaning.SURFACE CLEANING MARKET IN INDIA The Indian surface cleaners market comprises of three main segments: toilet cleaners. Each of these segments has multiple players.
of the total Lav Care segment. but after growing almost six times in the last five years. Harpic Flushmatic is the leader in India with more than 70% of the automatics share. Consumers continue to use the liquid cleaners for periodic tough cleaning. however. Thus. ITB" (Harpic Hygienic) cleaning blocks that are kept/suspended in the cistern. Lav Care market has also attracted a number of other major MNCs . while they get the benefit of continuous cleaning with every flush from the automatic ITC or ITB. ranging from 20% to 50% in different countries. but trying to establish themselves in this fast growing market.Sara Lee with Kiwi Kleen. the percentage of which is very small in India. Globally. PRODUCT CATEGORIES IN LAV CARE MARKET Lav Care products can be broadly classified in two formats: Liquid Cleaners Automatic Cleaners Automatics are basically "in the cistern. a brand acquired by Dabur India Ltd from Balsara Hygiene about two years back. However. to be used. It had supported the ITC product with small bursts of media advertising which resulted in huge sales jumps in initial years. In India. Within the automatics segment. the sales have become stagnant Page 7 of 23 . Muscle and Henkel India with Bref – who currently have a very small presence. giving a continuous. and account for less than 5% of the total Lav Care segment. S C Johnson & Co. the automatic cleaner segment is a large and well developed one. all the time cleaning action. with Mr. They work with every flush. ITC" (Harpic Flushmatic) or "in the bowl.3%). As stated above. increase total Lav Care consumption. automatics require a western cistern and regular water supply. automatics are relatively a new kind of format started in 2003.(6. automatics present opportunities for the marketers to increase spend per toilet and hence. It is believed that ITC and liquid toilet cleaners are not substitute products but rather complimentary products. Research shows that use of automatics does not fully replace the use of liquid cleaners. hence.
Domex was launched by its Indian affiliate Hindustan Unilever Ltd (HUL) in 1997 in India. A new variant of Domex plus phenyl was launched to capture the segment which still had strong faith on phenyl as a surface cleaning agent. Domex decided to do a frontal attack on Page 8 of 23 .COMPETITION / PLAYERS IN THE MARKET Some of the major competitors of Harpic in the Lav Care market. When launched. and aiming to tap the large potential market in the floor cleaning segment. the company also invested in a direct to customer initiative named "phenyl Khallas" to educate the consumers about the virtue of using Domex comparing it with local phenyl. sinks. and their strategies are briefly described below: Domex: Sold in other countries as Domestos by the global FMCG giant Unilever. After a lukewarm response from consumers in initial years.only 3% of the households use specialist floor cleaners while 97 % use proxy products which combination of phenyl. The toilet cleaner market meanwhile had shown very fast growth and was being nurtured by Harpic. as well as toilet cleaning. but perhaps headway made was not fast enough to match company’s expectations. Domex was positioned in India as an all purpose disinfectant cleaner (APDC) product which could be used for floor. The packaging of the new variant was also based on a multiple usage product. HUL’s strategy was to directly attack the phenyl market that incidentally comprises of a large number of small brands from the unorganized sector. At this time. unlike the angle necked bottle that was used by Harpic as a toilet cleaner specialist. HUL reduced the price of Domex from Rs 42 to Rs 22 per bottle. and currently is a distant second to Harpic in the Lav Care market in India with a share of 10. it has not been able to garner a large share. other surfaces. detergents. The strategy of All Purpose Disinfectant Cleaner at a low price did build the sales revenues for Domex in the years 2003 – 2005. In 2002. Over more than 10 years of its existence. acids and bleaching are the powders.5% in 2008. The Indian market for specialist floor cleaners was a nascent one .
Since.SC Johnson &Co. While most of the players in the household cleaning segment focus on the cleaning ability. While toilet cleaners are promoted for use in the toilet bowl. ( Refer annexure 4 for Domex bottle images) Sanifresh: This local player has been in the market for a long time and has been like a “me too” product to Harpic with similar packaging. its marketing resources are largely spent on consumer/trade promotions and discounts. The communication is also based on its positioning of "germs kill" expert. it did a test market for Mr Muscle toilet cleaner in Dec 2008 ( in Tamil Nadu). a new angle necked bottle and a new communication.Harpic and re launched itself as a "Specialist Toilet Cleaner". Mr Muscle: Another global biggie . After Dabur’s take over. It first entered the Surface care segment via Kitchen Cleaners. It used to be the second largest player in toilet cleaning segment and had peak shares of 15%+ in early and mid nineties. Its positioning is based on the surface care positioning of "Mr. but lost ground after entry of Domex. but. its value share gain is relatively low. then it has been advertising heavily on the national media. Domex positioned itself as a germ fighting cleaner. Moreover. it launched Mr Muscle toilet cleaner nationally in Jun 2009. Multi Purpose Cleaners and Glass Cleaners. Thereafter. The brand was bought by Indian FMCG major Dabur India Ltd from its erstwhile owners Balsara Hygiene about two years back. Post the test. Muscle science of tough cleaning". its share had fallen to 6.3%. was sometime back attracted by the lucrative and fast growing market of Lav Care & Surface Care in India and forayed into it with its global brand Mr Muscle. Page 9 of 23 . the brand has gained some momentum and focus since 2007. Sanifresh has been following a strategy of volume gains on the back of heavy discounting and promotion support. By 2008. The brand promises 100% germ kill (if Domex is used undiluted) and is targeted at households where there are kids. It has a very low presence in mass media and primarily advertises the promo tags only. It re-launched the product with parity pricing with Harpic. but lower price.
where most important product benefit sought by consumers is “Germ free” followed by visually clean. Fragrance/ removal of malodour Page 10 of 23 .Mr. cleaning practices and habits. In India. Consumer research studies done by RBIL over the years have also shown that in the Lavatory Care category. Traditionally. as well as on the outside surface of the bowl. Unlike western countries. A consumer research done on brand choice parameters has identified about 30 attributes with varying importance. with 'living' room/area. Disinfection-Germ Kill 3. Findings from a sample based research on toilet facilities and cleaning practices in India are given in annexure 5 and annexure 6 respectively. Also in India. kitchens and halls being cleaned at least once a day. acid. Muscle is promoted for use in the toilet bowl. The research indicates that perceived ITB (In the Bowl) cleaning and disinfecting ability have the highest correlation with brand choice in the lav care category. the toilet floor and the wall tiles in the toilet/bathroom. This has also been the reason that some of the all time popular formats for surface cleaning have been phenyl. squat type toilets are the norm with only 4% of the population owning a western style toilet. cleaning is generally a daily routine in most homes. availability of running water in toilets etc. Bathroom / toilet cleaning are found to be a little less frequent. the key category attributes sought by consumers are 1. there is a huge emphasis on visual cleanliness rather than germ free. in India. Cleaning/stain removal 2. Indians associate cleanliness more with visual cues rather than hygiene. types of toilets. and detergent. The choice of toilet cleaner by consumers is governed by large number of attributes which they are looking for in a product. CONSUMER RESEARCH Growth of lav care market in India is essentially linked to a multitude of factors like availability of toilets in Indian households. common or shared. and the acceptance of specialist toilet cleaners has been limited.
Harpic owns the platform of "powerful cleaning" and its current claim of Triple Action addresses the three key drivers as mentioned above. The big change that happened in the evolution of Harpic communication was the launch of "Door Step Challenge" in year 2002. Research has also shown that toilet cleaners are used at varying periodicity by different consumers. and this innovation has been highlighted and leveraged by RBIL in Harpic’s communication from 1993 onwards. The benefit that the brand promised consistently in its communication was "Harpic banaye aapke toilet ko naya jaisa" (i. Harpic makes your loo look like new) The brand saw phenomenal growth in the initial years of the Door Step Challenge campaign (2002 -2006). which results in a per household consumption of just over one litre of toilet cleaner per annum. HARPIC ADVERTISING HISTORY Harpic pioneered the process of building the Lav Care category by investing time. initially) and he would go to consumer's "Door Step" and show them the magical cleaning that Harpic was able to deliver. Angle necked bottle to easily reach into the corners/ rim of the toilet bowl. its usage is about three to four times a month by its users. On average. Page 11 of 23 . TV communication started in 1988.e. The Harpic Challenge TV commercial was hugely successful and resulted in sales going up by almost 50%. The key innovation was its packaging i. Thus. The key challenge was to convince non users that Harpic could give a level of performance that was superior to the current cleaners (acids/ phenyls). Hence. (Refer Annexure 7 and Annexure 8) The advertisements clearly positioned Harpic as a "Powerful Toilet Cleaner"."Take the Harpic Challenge and see the magic in front of your eyes". the tag line came into place . The creative idea that got developed based itself on "see to believe" strategy. It educated the consumers on the need for care & proper hygiene of the toilet space. a mini celebrity anchor was chosen (TV actor Aman Verma. effort and marketing resources for educating the consumers.e.
Harpic’s share dropped to about 75%+ in the recent April-June 2009 quarter (See annexure 9 for value and volume sales of major brands in the last four quarters). with rural areas accounting for less than one hundred thousand stores. in East . To address its declining share. The copy of the advertisements was also changed to communicate that Harpic was better/more effective than competing brands. Sometime in 2007. and intensity of advertising increased by 20% over the previous year. the Door Step Challenge was brought in again. the company launched Harpic Power Fragrance range in January 2009. The idea was to defend the brand’s share in the face of increased competition by spending a major chunk of its budget in advertising campaigns. In 2008. Some of the competitors have been concentrating their efforts more in Southern India which is the largest of the four zonal markets in India. Harpic’s Share of Voice started falling due to disproportionately higher advertising spends by some of the competitors as they were keen to invest in building their brands. say. and it is predominantly in urban areas. and have been able to make major gains there. and increase its presence in retail stores. The total number of stores stocking toilet cleaners reached almost one millio n in 2008. The retail penetration levels of different brands for the three years are given in annexure 10. Page 12 of 23 . Harpic’s share has therefore dipped much more in South than. and Harpic started to see a downward trend in its dominant market share.HARPIC: RECENT DEVELOPMENTS The change in the competitive scenario in the last two years saw a shift in Harpic strategy of focusing on trying to increase the penetration levels and bringing new users of toilet cleaners in Indian urban households. The competitors were slowly able to increase their market shares. Even with higher advertising spends. From a peak share of 86% in 2006. Harpic significantly cut down on below the line activities like Door to Door campaigns and started pouring more money in advertising through mass media.
The brand team also needs to p lan out a clear approach to attain its internal target of growing the category penetration levels to 25 to 30% by 2012. With a typical market leader's dilemma. This has been aided by the fact that toilet cleaners are an easy to manufacture product. this format has not shown much response from consumers so far. Big Bazaar started to stock lesser priced local brands of toilet cleaners as well as their own private labels. increasing consumption and increasing penetration are some of the elements which Harpic's brand team needs to ponder about to come up with right strategies and optimal marketing investment mix for the brand. defending aga inst competition. and a fixed marketing budget. next to Harpic’s shelves in their attempts to lure their customers and also get significantly higher margins on such products. with low entry barriers. Meanwhile.Another development of concern for the Harpic brand team was a significant slowing down in the growth in the penetration levels of toilet cleaners seen in the 2nd half of 2007. and the penetration level has remained almost stagnant over the year 2008. The huge margins allow them to run promotional schemes like buy one get one free to attract customers. Harpic now needs to prioritize its options for further growth. On another front of growing the automatics format like in the western countries. Maintaining current users. Harpic has been investing moderately in the automatics with limited TVC support and periodic In Store branding in modern trade. Although. Page 13 of 23 . where the fast growing major Retail Chains like Spencers. the brand team’s efforts to drive the consumption levels have not seen much headway so far. the brand team was also noticing new competitive activity in the Modern Trade. Reliance.
ANNEXURES ANNEXURE 1A: HARPIC’S INTRODUCTORY BOTTLE Page 14 of 23 .
ANNEXURE 1B: CURRENT SKU’S OFFERED BY BRAND HARPIC Harpic Liquids Range: Harpic automatics range: Page 15 of 23 .
0% 10.9 -0.3% 1.6% Change in MS % points 19.5% 1.6 - Page 16 of 23 .4 -0.7 2.3 0.ANNEXURE 2: MARKET SHARE DATA BY VALUE Value Market Share Total Toilet Cleaning Market (In Million Rs) Harpic Sanifresh Kiwi Kleen Mr Muscle Domex Bref Others Year 2008 1804 79.7% 0.5% 0.4% 6.6 -0.
ANNEXURE 3: MARKET SHARE DATA BY V OLUME Change in MS % points Volume Market Share Total Toilet Cleaning Market (Volume Kilo Litres) Harpic Sanifresh Kiwi Kleen Mr Muscle Domex Others Year 2007 Year 2008 15565 77.5% 1.1% NA 10.0% 18148 75.8% 7.6 -1.9% 2.3 -20 Page 17 of 23 .4% 16.6% 3.3% 7.5 0.0% 2.5 -0.7 0 2.4% 12.
ANNEXURE 4: DOMEX BOTTLES Page 18 of 23 .
ANNEXURE 5: TOILET CLEANING FACILITIES IN INDIA Page 19 of 23 .
ANNEXURE 6: CLEANING ACTIVITIES BY INDIAN CONSUMER Page 20 of 23 .
ANNEXURE 7: HARPIC’S COMMUNICATION ANNEXURE 8: HARPIC’S COMMUNICATION .THE HARPIC CHALLENGE Page 21 of 23 .
4% 8.9% 2.ANNEXURE 9: MARKET SHARE CHANGES IN PAST FEW QUARTERS By Value Value Market Share Data .9% Page 22 of 23 .8% 4.Last four July quarters of 2008-2009 Total Toilet Cleaning Market (Volume Kilo Litres) Harpic Sanifresh Kiwi Kleen Mr Muscle Domex Others 4903 76.3% 14.0% 2008 - Sept Oct .5% NA 11.Jun 2009 Oct .1% 1.7% 1.6% 2.0% 11.5% 1.3% 13.6% 0.2% 6.8% 1.6% 1.9% 7.4% 0.Jun 2009 5021 75.5% 1.5% 0.0% 0.Last four July .3% 6.1% 0.4% 12.8% 0.4% 502 75.8% 3.5% 6.Mar 2009 Apr .1% 1.5% 2008 Apr .1% 7.9% 12.0% 8.0% 1.Mar 2009 By Volume Volume Market Share Data .5% 2.6% 4931 71.1% 1.Dec 2008 Jan .3% 2.8% 12.3% 1.3% 502 77.6% 524 75.Sept quarters of 2008-2009 Total Toilet Cleaning Market (In Million Rs) Harpic Sanifresh Kiwi Kleen Mr Muscle Domex Bref Others 479 79.2% 1.1% NA 13.7% 0.5% 8.Dec 2008 Jan .1% 0.5% 5178 71.
829 136.428 213.739 122.362 160.295 YEC07 891.795 917.683 148.ANNEXURE 10: NUMBER OF STORES COVERED BY MAJOR PLAYERS No.512 733.301 Page 23 of 23 .539 141.586 799.620 930 21.737 NA 324 YEC08 995. of Stores Category Harpic Domex Sani Fresh All (U+R) India Mr Muscle Bref YEC06 814.344 NA 1.
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