This action might not be possible to undo. Are you sure you want to continue?
“THE PAINT INDUSTRY”
SUBMITTED BY:PRASHANT KUMAR Roll No.:511010877 FOURTH SEMESTER, SMU
A PROJECT REPORT
Under the guidance of <……………………> Submitted by <……………………> In partial fulfillment of the requirement For The award of the degree of MBA IN MARKETING MANAGEMENT
<MONTH> AND <YEAR>
An Endeavor to transform itself into success needs efforts. These efforts are individual, standing in isolation. Such individual efforts require three things for their further development. These three things being “Reason, Rationality and Self Esteem”. The combination of these three basic traits delivers Productivity. However, time and again this productivity requires encouragement and guidance. This much requisite support comes in the form of Professionals furthering the development of Amateurs. This acknowledgement is an effort to recognize these professionals who have made this project a combination of the three fundamental traits. I take the opportunity to express my sincere gratitude to all those who have guided motivated and inspired me in the completion of my project. This project report and the learning process behind it would not have been possible without the guidance of my Faculty Guide,<----->. He was able to impart me with the right approach that my report required for its successful completion.
Certified that this project report titled “THE PAINT INDUSTRY” Is the bonafide work of “PRASHANT KUMAR” who carried out the project work under my supervision.
SIGNATURE HEAD OF THE FACULTY IN CHARGE
CONTENT • Acknowledgement -----------------------------------------2 • Bonafide Certificate------------------------------------------3 • Abstract--------------------------------------------------------5 • Industry Profile-----------------------------------------------11 • Introduction---------------------------------------------------25 Objective of the project------------------------------26 Limitations---------------------------------------------26 • Main Text------------------------------------------------------27 Product at a glance------------------------------------28 Market survey-----------------------------------------47 Interpretation of data---------------------------------51 • Market analysis-----------------------------------------------55 Porter Model ------------------------------------------------55 Growth-share Matrix----------------------------------------59 Advertising management and Sales promotion----------62 • Recommendation-------------------------------------------------77 • Conclusions-------------------------------------------------------81 • References---------------------------------------------------------83 5 .
ABSTRACT 6 .
Animal fat was used as binder. red. Battles. These prehistoric paintings have been located in the caves of Altimara in Spain and lasasue in France. black & white colors. Some was done to ensure good fortune while some to hold evil spirits at bay or to honor the dead in their graves. priestly rites etc. Paint was a costly product of hard labor by master craft man. These prehistoric paints were made by mixing colures mud and water. The cave dwellers those times expressed their artistic abilities by daubing colored mud on walls. who reared & mixed their own raw 7 . The Egyptian during 3000 BC painted their houses of tail pieces about happening of those days. The tombs were supposed to have been painted to welcome the soul when it comes back to reenter the body which was kept well protected by secret preservatives. It was by 18th century that people realized the need for a long lasting paint rather than frequent repainting. of their caves painting pictures of food giving animals as well ass their fellow men. blue. They used their fingers and sticks as brushes. The origin of paint has been traced back to the prehistoric period. Paint factories started operating. they used yellow. Primitive painting was done with different ends in view.Paint: A historical background Story of paint is considered to be as old as the history of human civilization.
but in the presence of water coming trough plaster the reinforcement get corroded and weaken the structure. Concrete is highly alkaline by nature and hence protects the reinforcement made of steel form corrosion. However carbon di-oxide from the atmosphere reacts with the alkali in the cement forming calcium carbonate which gradually reduces the alkalinity of concrete exposing the reinforcement to the attack o corrosion.Materials from a secret formula handed over from generation to generation. A well formulated paint fortified with effective biocides 8 . The ever increasing demand of paint necessitated the introductions of new synthetic pigments & binders and new application technology. The 20th century revolutionized the concept of paint & paint application. Since corroded material occupies more volume than the steel. This cannot happen in dry conditions. The painting of an exterior wall serves both the purpose of preventing carbon dioxide and water penetration into the inner parts of concrete protecting the reinforcements and structure. Modern Perceptive Modern houses are made of concrete and bricks which are porous in nature and allow water penetrate. they push the plaster out culminating in cracking and flaking. which was now ready for the mass production stage. Keeping in line with the development of technology in other areas. The new technology has transformed an ancient art into a modern science. the development of paint technology in the last quarter century also surpassed the development in all the previous years put together.
checking for peeling paint. In short the success or otherwise of any painting job will be decided by the above factors. They are the panchamahabhutas earth. Incidentally. Berger. Once you get on the job of painting you will realize that the time spent on the preparation of surface is more than that required for the actual application of the paint. Nerolac. Post painting remedial measures are always cumbersome and do not offer permanent solutions. In total analysis this exercise is worth while because most of the paint failures arise from the poor surface preparation. cracks. About the Paint Industries The paint industry is facing an upward movement and growing at a CAGR of 10% per annum and is likely to grow at 10. Every organization tries to increase its market share by strengthening its distribution 9 .5-12%.Protects the surface from the attack of micro organisms like fungi and algae maintaining its original beauty. water air. leakages. light and of course there are the man made hazards like industrial environment ad gasses. and ICI) as well as Comparative analysis among the Major Players. Analyzing the Marketing Strategy of the Giants (Asian. This first step before any painting is the thorough inspection of the building. should be well attended to before taking up the painting job. New dealers are cropping up everywhere and this project tries to study the distribution channel followed by Paint Industry. Surface defects like rising. the causes of paint failures are the factors without which life is impossible o earth. microbial growth etc. rusty nail heads and microbial growth. heat. One important point to be remembered while painting is that no paint file is stronger than the surface on which it is applied. cracks. leakages. dampness.
And it is through Market Segmentation only a company can recognize that customers have distinctive needs. It is the choice that defines the business. distinct groupings of customers for whom the firm has the potential to offer superior value. It should be based on the management vision of the potential of the company for creating and serving markets. is choosing the customers it wishes to do business with. compared with those of competitors. and for achieving substantial profitability. The project would come out with a comparative analysis of the performance of five major paint manufacturers and highlights the various critical success factor and key strategies to be followed by Paint industry in the coming years to increase its customer base. needs and expectations then it will be easier for the company to push its products in the market and generate more sales turnover and grow. The same thing applies for the paint business also. These different groups will respond differently to the firm’s product offering and product communications. resources and capabilities. For a paint company the main customers are end customers. It must be a conscious choice based on the desires and values of the owners and managers of the business. for exploiting its unique strengths. as well as the assessment of the company’s strengths and weaknesses. Hence if the paint company comes to know about their behavior pattern. To increase the profitability and market share in a business the most important strategic choice any company makes. Moreover at present the Indian Decorative paint industry is riding high on 10 . creatively.Network and expanding itself to the regions where penetration is low. It is the process of analyzing the market in order to define. preferences and buying patterns.
go for diversifying itself in new markets and satisfy the growing customer expectations. The global average per capita consumption is 15 kg.The growth in hectic constructions in the housing segment. The per capita consumption of paints in India is very low at 0. The demand for paints is equal relative price-elastic but is linked to the industrial economical growth. In India the organized sector controls 70 percent of the total market with the remaining 30 percent being in the hands of nearly 2000 small-scale units. improving infrastructure and increase in per capita income.5 kg per annum if compared with 4 kegs in the South East Asian nations and 22 kegs in developed countries. Highlights :- The Indian paint industry is a $ 49 billion sector. to survive in this competition every company has to update to the latest technology. So in the long run. The competition in the market has considerably increased after the entry of foreign players in the Indian industrial scenario. 11 .
12 .In India the industrial paint segment accounts for 30 percent of the paint market while the decorative paint segment accounts for 70 percent of paints sold in India. the ratio of decorative paints and industrial paints is around 50:50. In most developed countries. All the industry majors have a vast dealership network and are required to maintain high inventory levels. Most of the paint leaders have technical tie-ups with global paint leaders.
INDUSTRY PROFILE 13 .
wood finishes and metal paints besides wall paints while other players cater to niche markets. Goodlass changed its name to Kansai Nerolac Paints Ltd. Dupont and BASF have set up base in India with product ranges such as auto finishes. PPG has a joint venture with Asian Paints to manufacture industrial coatings. Asian Paints India Ltd. The company's dominance is on account of its presence in almost all types of paints segments such as primers. (APIL) has the distinction of being the market leader in the paints industry and commands a market share of 33 per cent. APIL sources its raw material requirements of pthalic anhydride and pentaerythritol from its own in-house plants. Kansai paints of Japan.Major Players: The major players are Asian Paints. ICI and Shalimar. Kansai Nerolac. Solomon Islands. The company has a strong presence abroad with joint ventures in Fiji. to give it a new corporate identity. Recently world leaders like Akzo Noble. which provides it an edge over its competitors by reducing its raw material costs. 14 . It commands 38% in the decorative paints segment and 15% share in the industrial paints segment. which entered into collaboration with Goodlass Nerolac in 1984. PPG. Asian Paints India Ltd. Berger. is now the holding company for Goodlass Nerolac with 72 percent equity holding. In 2006. Tongo. Jenson & Nicholson and Snowcem India are not active players because of dwindling sales in recent years. powders and industrial coatings.
Asian Paints acquired the entire paint business of Pacific Paints Co. Kansai Paint Company of Japan. What keeps it ahead of its contemporaries is product innovation.700 TPA for paints. Pty. Having derived maximum income in industrial paints from Maruti Udyog Ltd. as demand for decorative paints will grow. Australia. Significantly. [KNPL] with its two wholly owned subsidiaries Saurashtra Paints Ltd. players like Asian Paints stand to benefit. Asian Paints' vision is to be among the top five decorative paints companies in the world by 2007.Nepal.000. for instance it was the first in the industry to tap the exterior paints segment. Ahmedabad and GNP Madras Ltd. Kansai Nerolac Paints Ltd. It is recognized as the leader in the industrial paints segment with a market share of 41 per cent. the company has now widened its client base to include many other automobile manufacturers like Mitsubishi Lancer. ranks second in the industry with 18% market share. is a world leader in paints. Ltd. the company continued to fare well despite the slowdown in the automobile segment and with the industrial paints segment likely to witness good growth in the medium term. KNPL appears to be in a fairly advantageous position 15 . With the government planning a thrust in the housing sector. It has a domestic installed capacity of 162.. The parent holding company. for Aus$375. Taking advantage of the increase in the automatic approval of overseas investments. Kansai Nerolac Paints Ltd.Asian Paints had also acquired the largest paint company in Sri Lanka. (MUL) until recently. Hyundai Motors and Telco. Mauritius and Australia...
Both companies will have equal representation on the board of the JV. The company enjoys the benefits of technical tie-ups with Valspar Coatings.165 mn.420 TPA. Berger has two plants located at Howrah and Pondicherry for producing synthetic resins and paints respectively. remaining earnings come from the industrial paints segment.140 TPA. USA and Herberts. Berger Paints Ltd. the company has entered into a 50:50 joint venture with ICI India Ltd. besides these it also owns a wholly owned subsidiary Beepee coating. will be transferred to the joint venture for an aggregate consideration of Rs. Berger Paints acquired Rajdoot Paints Ltd in FY1999. It is predominantly engaged in the decorative paints segment. A leading player in the industry.And should be able to reap rich benefits in the future. exclusively for automobile and industrial paints. which is responsible for two-thirds of its sales. a manufacturing unit in Gujarat. along with the assets at Rishra. Germany for heavy-duty coatings and automotive coatings respectively. Kansai Nerolac Paint’s manufacturing capacity is 88. In addition to increased focus on its existing industrial paints / protective coatings business. 16 . Berger Paints is a company with fairly sound fundamentals and a steady financial track record. The company also has the distinction of being the third largest player in the industry. Berger Paints boasts of a market share of 15 percent. The automobile and industrial paints business of ICI India. Installed capacity is 56. exclusively used for the paints business.
5%. The decorative paint business has a 17 . decorative paints are used in protecting the valuable assets like buildings. has now lost out to Asian Paints in the same category. peak customs duty has reduced from 15%to 12. helped by growing economy. However the growth was restricted in 2000-03 to single digits. ICIIL is recognized as the fourth largest paints manufacturing company. white goods and appliances.industrial and decorative paints. In the 1990s. The decision of the parent to invest more funds in the company could prove extremely beneficial. on vehicles. Shalimar Paints Ltd. Shalimar Paints are the leaders in the Aluminum Paints Category.This would bring down the cost of raw materials thereby positively impacting the profit margins of paint manufacturers.ICI India Ltd.In the budget of FY 2006-07 as well. ICI India Ltd. (ICIIL) is a part of the Imperial Chemicals Industries (ICI). This was mainly due to drastic reduction in excise from a staggering 40% to 16%. The company. Shalimar Paints Limited is the oldest paint company in India. which was set in Kolkata in 1902. The company has diversified interests and is not purely a paints company. the paint industry has recorded a healthy growth of 12-13 % annually. While the industrial paints are used for corrosion and rust to steel structures. The industry has two market segments. There was a revival in 2003-2004 with a robust growth of 13 % and moving with the double-digit growth thereon. UK which is a world leader in paints. which was a leader in the premium emulsion paint market. Backed by a market share of 13 per cent.
Organization System Most of the organized companies have a nationwide presence with multi location manufacturing facilities. The trends are likely to shift in India too but at a slower pace in favour of Industrial paints. In foreign countries 50 to 70% of the business is from the industrial segment. distempers 30%. solvent based enamel paint 36% and wood finishes 2%. The exterior category. interior emulsions 11%. marine coatings 5% and automotive coatings 50%. Not only the companies are able to establish themselves in interior markets the demand percolated to main towns and the company could enlist support of large customers. coil coatings 5%. particularly exterior emulsions is the fastest growing segment 20% for the last 3 years.Share of 77 %( about Rs 3640 crores in the organized sector) in total sales. In the industrial business share of high performance coatings 30%. the low Indian figure is not a surprise. As consumption goes with affordability. powder coatings 10%. Within the decorative segment the share of exterior paints is 21%.S.7 kg and 5.8 kg in other develop countries like China & Brazil. The per capita consumption of paint in India is 700 grams against 19 kg in the U. and 2. 18 . Major players have created a nationwide marketing setup with the focus on all interior/Small markets. The companies in the unorganized sector are mostly regional spread in and around there and manufacturing facilities dealing in low value products.
The country level organization structure is split into zones.Being FERA companies and some under MRTP. With liberalization. the situation have eased considerably. The machines altered the production pattern from 19 . most other players were not allowed to increase the production capacities till nineties. Earlier paint companies were required to manufacture all the shades (30-50 depending on a product line) in all the packs (5-8 packs). Business Re-engineering With the industry business-becoming complex. particularly on the manufacturing and the distribution sides. these shackles were removed and other companies have expanded. They have aligned their organized structures on the basis of expanding business and its complexities. in expanding the market. regions and branches. The colour dispensing machines both computerized and manual. industrial and high performance coatings. This made distribution still more complex as precise forecasts for over 3000 stock keeping units (SKUs) became a challenge for every organization. With the advent of color dispensing machines supported by all paint companies and sophisticated IT enabled distribution tools. The demand pattern was difficult to predict even when with the support of historical data/ trends as consumer preference was changing first. This was essential in order to tighten the controls as well. have transformed the business. most companies have gone into restructuring and have used information technology as the key drivers for reengineering. which helped. Another winning point for the companies was strategy to focus on smaller packs rather than focusing on larger packs. Today companies have divided their sales organization into decorative. They have also been bringing new product categories.
It has cut down the new products introduction cycle considerably. Both companies are operating on ERP (SAP R3) operating system through full connectivity across the factories and branches via V-SAT.1 version to improve its distribution and optimize production scheduling. it eliminated the sale loss for want of range/desired shade. Kansai Nerolac has gone one step ahead by launching its intranet-employee portal to capture knowledge sitting in the minds/desktops of individuals to a common platform. which can be assessed by all employees. which are installed at the dealers’ end and at leading garages. While Asian has invested on i2 technology. Kansai Nerolac has backed up IBM enabled APO and has gone for the latest 3. The machines have brought a total change in the way business is transacted and revolutionized business processes as well. The dependence on IT has increased remarkably from corner room EDP operations to playing a pivotal role in the way business is transacted. accounting and purchase. There are around many colour-tinting machines installed at the dealers’ ends including multiple machines on some counters. Most companies in the paint industry are functioning on multi-division models with individual functions controlled by 20 . Also popular are the gear mixers for 2K finishes in auto refinishes.shades to producing bases thus providing economics of scale. offering a choice of shades to consumers (in hundreds). reduced inventory level and eliminated redundancy of stocks. thus virtually working on live data for sales. For the retailers also. review and align performance. It has also invested in advanced business plan performance measurement tools like balanced score cards to track. This has helped expand the range of shades for each product category.
Issues in Brief: Storage Space Database Fragmentation Response Time to user operations Non-availability of Downtime at a stretch 21 . Any activity to be performed had to be carried out in a very short span of time as the estimated downtime for this project was 192 hours. As in the case of KNPL there are two levels of team managing/ guiding business. in a way working as a think tank for the company. which reviews operation on a monthly basis there is a parallel team named business analyst team (BAT). While all the policy and major decisions are taken by the management committee (MC). The major challenge faced was in fragmentation and the release of space for near future. which analyses the business. The SAP tool was not able to substantially free up space to accommodate for near future growth.business heads. There was an inescapable need to manage the space. discusses the new initiatives. Challenge:The SAP database is in Terabytes and increasing at the rate of Gigabytes per month. Asian Paints adds 25% of Storage Space for SAP Application Database without any investment. the response time had also gradually dropped. Some manage their business through sub-committees. As a result of the space congestion.
object sizes. With precise planning and control over the activity. the project was completed in 25% less than actual downtime scheduled. Database Fragmentation: Removed fragmentation from database as well as object level fragmentation. The complete action plan was implemented successfully in the TEST environment. 22 .The Solution:A complete study was performed of database usage. Storage Space : Released near about 1 TB of storage system which has enabled Asian Paints to sustain with same hardware. Response Time: Removing fragmentation and converting table spaces from Dictionary managed to locally managed has reduced the I/O in turn improved the response time. Although the distributed downtime was scheduled for a total of 8 downtimes of 24 hours each. peak time. the entire project was complete 48 hours before the schedule. A project plan was created to re-organize the SAP database from back-end using export/import and object movement. transactional and master. The same activity was planned on PRODUCTION environment with distributed downtime. growth pattern.
psychological barrier that water base cannot be superior to solvent protecting wood or metal surfaces. outside there is a clear shift visible from solvent to water based glossy enamels. low level of gloss in water based enamels. While solvent-based enamels are still popular in India.Non-availability of Downtime at a stretch : Distributed downtime was scheduled for a total of 8 down-times of 24 hours each. which has expanded the market and triggered a shift from cement paint. Asian Paints could enhance the performance for business users in terms of response time as well as saved (earned) from buying additional storage capacity. Product Culture: Most companies have an identical range of products for the decorative. This not only increased the return on investment on the existing infrastructure but cut down unnecessary investment on buying new hardware. In the case of decorative products the technology has been more indigenously perfected over the years and the products can be divided on the basis of interior and exterior application or in categories like water base and solvent base. Moreover. India will take some time before this change is accepted on account of three hurdles currently faced on this-cost (water based is expensive). most companies have been advertising their products in exterior emulsions category. In the industrial range is more customized and guided by the technological support provided by the collaborators. 23 .
Low productivity of high cost labour in the old units has been another problem. On account of this. The poor forecasts of demand result in poor distribution. However most companies in the lower rungs are slack on realization of debtors. The customer (retailer) has also been dictating his terms as most companies have common counters to meet their objectives. Working capital requirements are moderate.Companies not working on operational efficiency business models have been losing. Margins have remained under pressure on account of dropping prices. Companies have been working in improving internal efficiencies to retain profits. Added to this has been the problem related to collection of installments on colour dispensing machines which are mostly given on lease. Berger has been managing well with economical yet acceptable formulations and low operating costs. which has been more strategic and forced by the market leader. Even with the turnaround of the economy. The biggest efficiency required is the physical distribution. The industry is not capital intensive and depreciation charges are not significant. This in totality has increased operating pressures and resulted in stressful working. the companies are investing in sophisticated supply chain management tools. 24 . So they have no choice but to lure more customers through incentives. The pressure from original equipment manufacturers to reduce prices has also been a cause for low profits for paint companies. the pressure has not relented. Asian and Nerolac have been aggressively working on cutting costs/ Operating expenses.
but mostly for industrial coatings. ICI (decorative) and Dupont (auto refinishes). BASF. For decorative range of products it is difficult for international companies to set up shop on stand alone basis because of existing Barriers such as strong network of existing players. with radical and unique range of products. PPG. Nippon. properly conceived and marketed in Indian context and supported with machines. There is however room for niche players. Therefore the safer route will be to tag along with existing companies. brand image. range of products (Indian context) and required distribution logistics.Some of the international players are already present in India. 25 . For industrial products. the required range can be made and sold. A few others are present through collaborations like Kansai. however this may not apply and based on their tie-ups in home countries and their OEM customers. They include Akzo Noble. Henkel.
INTRODUCTION 26 .
Chances of biased responses from the consumers and competitors. LIMITAIONS:Although the project is my sincere effort to derive a comprehensive analysis out of the data collected. To understand the types of paints and finishes. Kansai Nerolac. it has some inherent limitations because of deviations in market conditions: The implications of the analysis may not apply to every market and product because of variation in markets and market conditions.OBJECTIVES OF PROJECT: To do the comparative study of the paint companies (ASIAN PAINTS. 27 . To understand the Marketing and Advertising Strategy. Berger. ICI and Shalimar. India's position on the global Map in terms of competitiveness.
MAIN TEXT 28 .
medium and distemper segments. The medium range consists of enamels. but the revival in these sectors is cause for cheer for the paint industry as well. to make their presence felt in this segment the paint majors are now indulging the customer in the process and 29 .PRODUCT AT A GLANCE:Paint is a mixture of four 4 elements . paints can be differentiated into decorative or architectural paints and industrial paints. On product lines. Distempers are economy products demanded in the suburban and rural markets. popular in smaller cities and towns. pigments and additives. The recession in the construction and automobile sector had thrown in shades of grey across the Industry spectrum. the automotive segment is a major consumer of the latter. Premium decorative paints are acrylic emulsions used mostly in the metros. Nearly 20 per cent of all decorative paints sold in India are distempers and it is here that the unorganized sector has dominance. The balance sheets of the industry majors are now tainted with bright colors. Decorative paints can further be classified into premium. Pigments impart color and opacity to the paint and the additives give it special resistance properties. While the former caters to the housing sector. Solvents give the paint a liquid flow while the binder binds to the surface.solvents. binders.
high performance coating and automotive and marine paints. Of the 300 odd raw materials. Thus. Market profile:The leaders in the organized paint industry are as follows: Asian Paints (India) Ltd. nearly half of them are imported petroleum products. The major raw materials titanium dioxide. that is. the decorative paint segment is more or less customized. this. any deficit in global oil reserves affects the bottom-line of the players. Price sensitivity factors:Various factors that have influenced the pricing of paints are summarized below: The industry is raw-material intensive.Preparing shades according to the needs and wants of the customer. phthalic anhydride and eutarithrithol constitute 50 per cent of the total cost. But two-thirds of the industrial paints produced in the country are automotive paints. there 30 . (KNPL) Berger Paints ICI (India) Ltd. Industrial paints include Powder coatings. (APIL) Kansai Nerolac Paints Ltd. Besides.
there are basically 5 types of paints to consider:1. They should be attractive yet durable 31 . Special Application Paints. Wood Finishes 5. However. Metal Paints. Interior Paints. 4. 2. Exterior Paints. 3. 1) EXTERIOR PAINTS:When choosing exterior paints for the exterior surface/walls. The prices of packing materials such as HDPE. The raw materials cost sums up to a whopping 70 per pent. WHAT ARE THE TYPES OF PAINTS USED IN BUILDINGS? For painting your home. BOPP and tinplate have reduced considerably.are other raw materials such as Astor. the decision of the Central Government to ban import of tinplate waste could lead to a spurt on the prices of the tinplate in the near future. linseed and soybean oils. Most of the paint majors have to import nearly 30 per cent of their raw material requirements thus changes in import policies can affect the industry. Any increase in the prices of these raw materials would adversely affect paint prices. turpentine. look for ease of application against weather and quality.
egg shell. along with vinyl or acrylic resins added to make them hard wearing. Textured Plasters provide even stronger protection than Emulsions. cinder block and asbestos-cement) include the following types: CEMENT PAINTS . they are also fade resistant and can last for 4-5 years. Special additives equip them to stand up to the rigours of outside exposure. stucco. A sound application of cement paints. Their thick surfaces can be designer-patterned by sponging. Available in a wide range of colours. TEXTURED PLASTER . EXTERIOR ACRYLIC EMULSION – Emulsion paints are also water based. after proper surface preparation. Emulsion paints give various degrees of sheen and are available in matt. They are highly water resistant and are the best option on a newly concreted surface. They provide a coating that assures effective. they are adequately fade-resistant. The paints become harder wearing as the shine increases.These are water based paints and are applied on the outer surface of the house. cement.These are also emulsion based exterior finishing coats. Special additives make them exceptionally resistant to algae. Given careful and correct surface preparation and priming. The paints for exterior surfaces (such as brick. atmospheric erosion and extremes of heat and cold and rain. enduring coating with superb adhesion and flexibility.enough to withstand weathering. can stretch your repainting cycle to 5 years. silk. medium range protection against the weather. fungus. besides unusual visual appeal. they create a tough. 32 . Available in matt finish and a range of standard colours. satin and full gloss ranges.
Their lifecycle is shorter than that of emulsions. their attractive colours and patterns blend smartness with heavy duty protection. given proper application and workmanship. Washable over and over. 2) INTERIOR PAINTS:- DISTEMPERS .The traditional economy paints. Acrylic 33 .stippling or patterned rollers. Dry Distempers (which come in powder form) and Oil Bound / Synthetic Distempers are not washable. they can produce a perfectly satisfactory finish at reasonable cost.
produce greater smoothness and wash ability. in a wide choice of colours. Emulsion paints give various degrees of sheen and are available in matt. Special additives in plastic emulsions give them an incomparably smooth finish. being partly based on acrylic resins. A ‘silk’ wall looks fresh even after several years. They are extremely durable but are not suitable for application on external surfaces. They come in three categories namely: SILK EMULSIONS (PREMIUM ACRYLIC EMULSIONS) . INTERIOR EMULSIONS (PLASTIC PAINTS) . Combining silk and regular judiciously could give your painting project just the right balance between great looks and a long-cycle economy. resistant to chemicals. in beautiful shades that last for years.Distempers. with silky smoothness and a luxurious silk-like finish. REGULAR EMULSIONS – they produce a smooth eggshell finish. silk.Emulsion paints have water as a base with a fine dispersion of vinyl or acrylic resins. wood and iron surfaces. egg shell. These paints are harder wearing as the shine increases. create a Remarkably tough. they keep their good looks for 3 to 4 years. and algae and easy to maintain. satin and full gloss ranges. durable coating. fungus. which on drying. 34 . and have almost the same durability as Silk. These paints are also washable. Properly maintained.They are premium acrylic emulsions. Their very high acrylic resin content enhances durability and creates reflection and smoothness of such a high order that dust cannot settle on it. adherent.
They are still a generation ahead of Distempers on durability. wash ability. metal grills and furniture have a common type of paint for coating them namely the Enamel paint. In addition wooden surfaces and furniture may be protected by synthetic transparent finishes like PU and Melamine.ECONOMY EMULSIONS . 35 . fade-resistance and smoothness.offer the basic strengths of emulsion paint at economy prices. Enamel paints are not water based. 3) METAL PAINTS:Doors and windows.
36 . including rusting. they also provide very good protection against atmospheric corrosion. Two coats of general purpose enamel give good long term protection for hardworking surfaces where durability and economy are chiefly wanted. They withstand extreme climatic changes and can be used both inside and outside. provide a durable and pleasing. provide long protection and mirror-like finish. and provide an extremely tough. PREMIUM ENAMELS . Available in both matt and glossy finishes. GENERAL PURPOSE ENAMELS – are also tough. They are not recommended for exterior surfaces. they can be used on a wide variety of wooden surfaces including furniture old and new and cane. transparent protective coating.are alkyd resin based formulations that work equally well on wood.are extremely tough. though less glossy finish. But unlike varnishes. Besides a brilliant and smooth finish. heat and liquid and stains.are the modern alternative to oldfashioned varnishes. they are to easy too maintained and stand up to rigorous wear and tear. They allow the beauty of the wood grains to show through. These are synthetic.SYNTHETIC ENAMELS . 4) WOOD FINISHES:POLYURETHANE (PU) AND MELAMINE . metal and even walls.
fumes. especially in Bathrooms and Kitchens. grease stains. Condensation of moisture. etc. The advantage is that they can be wiped down with a damp cloth to keep them clean. flaking and mould infection. 37 .5) SPECIAL APPLICATION PAINTS:FLAT OIL PAINT FOR BATHROOMS AND KITCHENS – Flat Oil Paint is recommended over emulsion based wall paint to correct staining and flaking. cause paint breakdown.
.ANTI-TERMITE PROTECTION FOR WOOD . besides corrosion.To protect the outside of Water Tanks use Aluminium Paint. When the gloss on a panel painted with Matt finish paint is measured in a glossometer at 60- 38 . fungus and corrosion. which has the lowest level of gloss. ALUMINIUM PAINT . Nontoxic Bituminous paint will keep the inside of the water tank free of algae. through increasing degree of Luster to high gloss finishes.It is absolutely essential to pre-treat all wooden surfaces with a transparent Melamine coating. they produce films with varying degree of sheen. The range extends from Flat or Matt finishes which have no sheen. Aluminium Paint can also be used effectively to increase the life of gas-holders in kitchens WHAT ARE THE TYPES OF PAINT FINISHES? When Surface Coatings (Top coat of Paint) dry. Based on the reflectance level of the dried film of paint we can classify the finish in to following four heads: MATT: It is the kind of finish. BITUMINOUS PAINT FOR WATER TANKS – Concrete and galvanized iron water tanks are susceptible to algae and fungus attack.Its greatest advantage is that it allows subsequent over painting with paints. brushed onto bare wood to guard against termites. synthetic finishes and polishes. with reflective silver-like luster that also reduces internal temperatures. wood borers. etc.
When the gloss on a panel painted with Satin finish paint is measured in a glossometer at 60-degree angle. GLOSSY: This is the finish with highest level of gloss. SEMI-GLOSS: This finish has more gloss than a satin finish. the reading is more than 70. the reading is 21-70. When the gloss on a panel painted with a Gloss finish paint is measured in a glossometer at 60-degree angle.Degree angle. the reading is 6-20. When the gloss on a panel painted with Semi-Gloss finish paint is measured in a glossometer at 60degree angle. explains the name Satin finish. SATIN OR EGG-SHELL: This finish has silk like gloss. 39 . the reading is less than 5.
Therefore. Storage should be in a cool dry place.HOW ARE PAINTS STORED? It is difficult to reseal the paint container and store the paint well for a long period of time.Proper disposal of left over paint is a challenge. To dispose of paint. the paint may be discarded with normal trash. either by leaving the lid off until it solidifies or by pouring it into a disposable drying device. protected from freezing. HOW IS PAINT DISPOSED OFF? LIQUID PAINT .Sometimes it can be recycled: Old paint may be usable for a primer coat or an intermediate coat. Interior/exterior house paint tends to separate when stored. Once dry. one method is to dry it. the heavier components settling to the bottom. for a good seal. it should be mixed before use. It should be stored upside down. RECYCLING PAINT . WET OIL BASED PAINT – should be treated as hazardous waste. and disposed of according to local regulations. with a flat wooden stick or a paint mixing accessory. 40 . and paints of similar chemistry can be mixed to make a larger amount of a uniform color.
Since there are hundreds of options in paint colours. it may seem to be a difficult task. It has been scientifically confirmed that colours affect our mood. But just as you coordinate colours 41 . play and rejuvenate in the spaces. it is best that you make the decision instead of trusting someone else because you will be the ones who eat and sleep. health. entertain. happiness in different ways. When choosing colours for your House.Colour is the most powerful decorating element in our homes. Colours evoke emotions in us and affect us in ways that we are not even aware of.
Sometimes. they occur simultaneously during painting. moisture or solvent between the surface and the paint film. Avoid painting under direct sunlight. COMMON PAINT DEFECTS AND REMEDIES:Many problems can occur after painting. Here are some common paint defects and their solutions: Blistering: Blistering or Swelling of paint is caused due to the trapping of air. you can choose colours of your choice for your rooms. The solution. Then repaint with a recommended paint.Everyday in what you wear. But before that. an understanding of colour and its basics can really be helpful.Remove any unstable paint films and allow the wall to dry thoroughly. Understanding the causes of some of these defects can make the paint job easier. Bittiness: Bittiness is caused by dirt from the atmosphere or the surface or from brushes that are inadequately cleaned or due to bits of dried-up paint that gets 42 .
Chipping: Chipping of paint film is due to excessive use of putty or due to very thick coat of paint or defective surfaces.Use clean brushes and paint on clean surface and strain the paint through a cloth before use. 43 . The Solution .Stirred in.Remove algae / fungus by high-pressure washing.Regulate the use of putty and paint. Wash again to remove any residue and allow the wall to dry before applying with recommended paint. The Solution. Brush marks: Brush marks are caused due to under-thinning of paints or due to poor application of the final coat of paint or due to poor quality brush. Algae/Fungus growth: Algae and fungus can grow when the surface is continually damp and dirty. Insufficient fungicide/ algaecide in the paint can also worsen the situation.Ensure paint of the right viscosity is applied using a good brush. The Solution . The Solution .
Allow the wall to dry thoroughly.Give a long time gap between plastering and painting (about 6 months including one monsoon) Use paint with a porous film like emulsions and distempers. which surface later on.Chalking: Chalking occurs when ultraviolet rays cause the paint binder to disintegrate. The solution. and repaint with a recommended paint. It can happen when interior paints are used for exterior surfaces. Efflorescence: Efforescence or formation of white powdery deposit on walls after painting is caused due to salts present in the building material like brick and mortar. Roughen the enamel paint with Sandpaper or use a barrier coat of matt primer.Remove any unstable paint films. The SolutionClean the surface thoroughly with soap solution and water. Cissing: Cissing or tiny craters are caused by oily or greasy surface/due to water based paints being applied over glossy or smooth enamel paints. The Solution. 44 . Make sure the paint is not adulterated with foreign materials.
Repair water seepage.Clean surface thoroughly and take all recommended steps for surface preparation. The Solution . 45 . It can be due to application of paint on insufficiently dry surfaces. Make sure the surface is dry before painting and apply an alkaline-resistant or oil-based paint. Discolouration: After paint is applied. it may fade or discolour. The Solution.Loss of gloss: Loss of gloss is caused due to poor surface preparation or due to presence of oil or due to over thinning of paint. Also ensure that the surface is dry and clean. It can also be due to shrinkage or expansion of a surface causing the paint film to move.Ensure that there are no gaps in covering putty with primer coat. Flaking: Flaking-off of paint film is due to improper application of primer coat over putty. and not being completely covered. This is caused by particles in the wall reacting with the paint when it is drying. Discolouration could also be caused by water seepage. or by contaminants in metal or wood. The Solution.
It is caused by the pigment separating from the paint and settling at the 46 . Prime surface and re-coat with suitable paint.Patchiness: Patchiness or uneven finish is caused due to the highly absorbent nature of the surface. Use an alkali-resistant basecoat or sealer. Peeling: Peeling is caused by moisture on the wall. This defect happens on walls as well as wood or metal surfaces.Prime wood before painting. sand surface and clean off dust.Apply an extra coat of primer or use wellsealer. The solution for Walls -Check and repair water seepage. Patch surface defects with putty. The Solution. Sagging: Sagging happens when the paint droops downward after being applied on the surface. The solution for Metal . The solution for Wood . Ensure walls are dry before painting. poor surface preparation or using an incorrect painting system.Remove all paint from metal before re-painting.
Bottom of the container and comes as a result of insufficient stirring or shaking during storage or storing for too long or under too much heat or faulty thinning. The Solution- Avoid storing in hot locations for long periods. Store in accordance with the manufacturer’s recommended thinners. recommendations. Thin only with appropriate
Wrinkling: Wrinkling happens when the paint forms film-like undulating waves. Applying too much paint or drying during high temperatures or painting on a topcoat before the undercoat is dry can cause this defect to happen. The SolutionAvoid applying too much paint. Make sure no paint accumulates around bolts, rivets, etc. Wait until each coat dries before you re-coat. Slow drying: Non-drying or slow drying of paint film is caused due to humidity, poor air circulation, low temperature or presence of oil or grease on the surface or due to alkalinity of the surface. The Solution- Reduce the impact of atmospheric conditions to the extent possible; Scrub oil or grease off with a rag soaked in white spirit and wash with water and soap.
Many people find the technical terms associated with Paint and other protective coatings difficult to understand. I have explained these terms here in easy-tounderstand language.
MARKET SURVEY:Current Trends The industry is riding high on growth in the automobile industry, hectic constructions in the housing segments, improving infrastructure and overall increases in the per capita income of the middle class. Thirty percent of the paint business is contributed by painting of new construction area. GDP growth projections of 8.5% in the current year mean a growth of 10.5-12% in paint business. The growth will be 11-12% in the industrials and 10-11% in the decorative. The automobile industry has been doing remarkably well and will benefit the market leader in the segment Kansai Nerolac. As for the future outlook, the industry has predicted a CAGR of 12% for the next five years from the last Year growth levels of 27.4% for cars, 8.9 % in two-wheelers and equally encouraging current year trends. The housing industry is likely to do well in current year as well with last year growth rate being around 50%. Taking the continuing feel good factor for the overall economy as well as one safely looks at 10-12%growth rate for the paint industry in the next five years. Consumers can look forward to new products getting launched-some for application for special areas. Companies will be offering value addition to
customers by offering a variety of finishes through specialized and trained applicators. There will be more options like range of colour/finishes (clear) for wood applications through the tinting machines. The trend for water-based coating is likely to set in both for industrial and decorative applications. India is still away from the do-it-yourself concept as cheap labour is still available. Exclusive retail chain stores sponsored/ run by paint companies will become a reality. The industry has progressed well and is likely to be influenced by changing global scenario. New technologies, new innovative products, new associations, consolidation of industry and poor performers getting out of the scene will characterize future development. Ultimately there will be only four or five key players operating in the market. The company wise trend in Market Share shows that Asian Paints are the leaders in the decorative segment by a market share of 38%, followed by Kansai Nerolac Paints with a market share of 14%. Market Share of Five Major Paint Companies Decorativ Company Asian Paints Kansai Nerolac Paints Berger Paints ICI Paints Shalimar Paints Overall 33% 19.30% 15% 13% 5% e 38% 14% 10% 9% 8% Industrial 15% 41% 10% 9% 8%
Asian paints are the industry leader with an overall market share of 33 per cent in the organized paint market. It has the largest distribution network among the players and its aggressive marketing has earned it strong brand equity. The Berger Group and ICI share the second slot in the industry with market shares of 17 per cent each. KNPL has a market share of 5 percent in the organized sector. The market can be further split into decorative paints and industrial paints. The demand for decorative paints is highly price-sensitive and also cyclical. Monsoon is a slack season while the peak business period is Diwali festival time, when most people repaint their houses. The industrial paints segment, on the other hand, is a high volume-low margin business. In the decorative segment, it is the distribution network that counts while in the industrial segment the deciding factor are Technological superiority and tie-up with automobile manufacturers for assured business. APIL dominates the decorative segment with a 38 per cent market share. The company has more than 15,000 retail outlets and its brands Tractor, Apcolite, Utsav, Apex and Ace are entrenched in the market. KNPL, the number-two in the decorative segment, with a 14 per cent market share too, has now increased its distribution network to 10,700 outlets to compete with APIL effectively. Berger and ICI have 10 per cent and 9 per cent shares respectively in this segment followed by Shalimar with 8 per cent shares. The share of industrial paints in the total paint consumption of the nation is very low compared to global standards. It accounts for 30 per cent of the paint market
Ashok Leyland. It supplies 70 per cent of the paint requirement of Maruti. 51 . It has a lion's share of 70 per cent in the OEM passenger car segment. But. in line with the global trend.with 70 per cent of paints sold in India for decorative purposes. KNPL dominates the industrial paints segment with 41 per cent market share. Mahindra & Mahindra. with the decorative segment bottoming out. In the next few years. Toyota. But with its joint venture Asian-PPG Industries. PAL Peugeot and Bajaj Auto. In most developed countries. TVS-Suzuki. the leader in decorative paints. Ford and General Motors and is all set to ride on the automobile boom. It has now emerged as a 100 per cent OEM supplier to Daewoo. Ford India. The future for industrial paints is bright. Hindustan Motors. the ratio of decorative paints vis-Ã -vis industrial paints is around 0:50. APIL. India's largest passenger car manufacturer. companies are increasingly focusing on industrial paints. ranks a poor second after Kansai Nerolac in the industrial segment with a 15 per cent market share. Hyundai. 40 per cent share of two wheeler OEM market and 0 per cent of commercial vehicle OEM market. KNPL also controls 20 per cent of the consumer durables segment with clients like Whirlpool and Godrej. The company is also venturing into new areas like painting of plastic. coil coatings and cans. its share would go up to 50 per cent. Hero Honda. besides supplying to other customers like Telco. the company is aggressively targeting the automobile sector.
INTERPETATION OF DATA/FINDINGS:- Sector Wise Consumption of Industrial Paints 52 .Berger and ICI are the other players in the sector with 10 per cent and 9 per cent shares respectively. Shalimar too. has an 8 per cent share.
MARKET SHARE 53 .
Asian Paints operates in 21 countries and has 29 paint manufacturing facilities in the world servicing consumers in over 65 countries. and building shareholder equity.Asian Paints is India's largest paint company and the third largest paint company in Asia today. 55 . The company has an enviable reputation in the corporate world for professionalism. fast track growth.
MARKET ANANLYSIS Porter’s model:- To understand the competitive landscape of the paint market better. one can analyze the paint market from 4 key angles: the buyers. potential new entrants and threats from substitute products being introduced into the market. it can be useful to employ Michael Porter's model of market competition. In this model. 56 . raw material suppliers.
slowly but surely. there is an increasing demand for more trendy and easy-to-use alternatives to paints. High raw material prices squeezing paint supplier's margin Resins prices have been rising in the past few years for almost all kind of paints. It has been observed that these buyers. Thus. While architectural paints mainly follow the retail channels. paint companies are getting squeezed from both directions resulting in thinning of their profit margins. As countries in the Asian region become affluent. End-users are demanding higher quality paint for the same or a lower cost. are becoming increasing powerful with their growing bargaining power. both direct end-users and retail channel. industrial paints are sold directly to enduse companies. Another challenge on the resin front is that the introduction of newer technologies and newer types of resins are pushing out few conventionally used resins.Buyers becoming stronger Paints are sold through direct sales as well through distributors. This will definitely affect the resin situation in the market and would require the paint companies to adjust accordingly. irking the paint suppliers. and those who fail to do so are losing out to the closely fought competition. . Paint consumer looking to other alternatives to paint Last among the key factors of competition in Porter's model is the threat from substitutes and this is one issue which is. Governmental regulations against paints containing volatile organic compounds (VOC) will be a major factor in throwing out certain kinds of paints from the market. Colorful patterned wallpapers and wall paneling are being preferred by some for architectural use 57 . Paint manufacturers are continuously being forced to reduce prices.
the use of coatings for office equipment is decreasing significantly. It has a technical tie-up with Herbets of Germany in addition to its joint venture with Decker Industrifag. In conclusion Based on the above-stated factors. it can be clearly concluded that the paints & coatings industry is facing challenges from almost all directions in the competitive landscape.instead of regular emulsion paints. Berger has a series of tie-ups for various purposes. With the agreement with Herbets to an end in 2001. Equipment suppliers prefer to use metallic finishes and oxidation process to give a more matt and sleek look to the Equipment. Asian Paints has formed a JV with PPG Industries Inc service the automotive OEMs. Also. Technology collaboration All the paint majors have tie-ups with global paint leaders for technical know-how. The key to success in this market lies in building a strong brand image through aggressive marketing strategies and gaining customer loyalties. Berger has now allied with the Japanese major Nippon Paints to boost its OEM turnover since the Indian roads are 58 . these metallic options are considered more hassle-free as there are no issues of paint chipping. In terms of industrial use. re-painting etc. Paint suppliers have to act aggressively and efficiently to stay abreast in this highly competitive market.
being flooded with Japanese automobiles. Nihon Tokushu Co and Oshima Kogyo Co Ltd. Du Pont. Nepal. Tonga. which is a leader in automotive coatings in the US. Ltd. which has been recently. the company has emerged as the number one player in these markets. Goodlass also has technical collaborations with Ashland Chemicals Inc. acquired by E I Du Pont de Nemours of the US. Solomon Islands. Oman and Mauritius. Asian paint exports its paints to over 15 countries. Australia. It also has an agreement with Orica of Australia Pvt. It also has joint ventures in Fiji. has a technical tie-up with Kansai Nerolac for the manufacture of sophisticated coatings for the automotive sector. Japan. and leader in the petrochemical industry. In October 1999 it acquired 76 per cent equity stake in Delmege forsyth & Co (Paints) Ltd. Within a short span of just five years. Incidentally. the second largest paint company in Sri Lanka with a 12 per cent market share in Sri Lanka's Paint Industry. to produce new generation protective coatings. 59 . Overseas expansion If the global Goliaths are poring into the Indian paints market aggressively. ICI makes paints with the technical support of Herbets. Vanuatu. Interestingly. the Indian paint companies are also spreading their wings. USA. The company also has tie-ups with Calspar Corp and Teodur BV for manufacturing heavy duty and powder coatings.
But these are typically the long-term growth drivers for the sector as a whole. If it is less than 60 . nevertheless. Perhaps. these are steps in the right direction.Share Matrix:- In the BCG model. the top two paint companies will witness traction at the top line level. While benefits from these initiatives are unlikely to be immediate. Market Share is defined as market share relative to the market share of the largest competitor. considering the fact that imports as a percentage of sales were around 6% of sales for companies like Asian Paints. which is more than 1 if the SBU is a dominant competitor. The reduction in excise duty on plastic (the main packaging material as far as the paint sector is concerned) should cushion the impact on increase in other raw material prices. Industry growth rate is said to be high if it is more than 10%. In a scenario where domestic players are increasing capacity and new players are expected to launch products in the small car category.Budget Impact There is a great emphasis by the Finance Minister on rural and infrastructure development. The reduction in customs duty is a big positive for paint majors. the two dimensions are the industrial growth rate and the market share. on a logarithmic scale. The result is a number. one would have expected a more aggressive stance on rural and infrastructure development. Growth.The reduction in excise duty on small cars is likely to benefit both Asian Paints and Kansai Nerolac in a significant manner. low if it is less. as the prices of cars will decline. Thus a firm’s position is measured by dividing its market share by the largest competitor’s share.
1.Low Market Share. The divisions are as follows: • Question Marks. it is not dominant. The description results in a two-by-two matrix.Low Market Share-Low Growth 61 . it has an inferior cost position and is an inefficient competitor with weak prospects for success in the market.High Market Share-High Growth • Cash Cows.High Market Share-Low Growth • Dogs. If the SBU is not the dominant player.High Growth • Stars.
Sales and Distribution System:- 62 .
The brand has traveled from that garage to become Rs 1000 crore brand.73 Bn) Indian paint Industry. this brand occupies a premium position in the Indian Paint industry. Indian paint industry can be broadly divided into two segments:A) Decorative segment which constitutes the wall paints: exterior and interior. 63 . wood paints etc. The story of the evolution of Asian Paints as a brand is interesting. The brand now has an iconic status in the industry thanks to some blockbuster big ideas from O&M. From 1968. The name Asian Paints was picked randomly from the telephone directory. Asian Paints started its journey in 1942 with four young men in a garage in Bombay. The brand once positioned as a mass market brand has evolved itself to a higher plane. The organized sector constitutes around Rs 5400crore ($1.2 Bn).Advertising Management And Sales Promotion Asian Paints: “Every Color Tells a Story” Brand: Asian Paints Company: Asian Paints Agency: O&M Brand Count: 211 Asian Paints is the market leader in the highly fragmented and highly competitive Rs 7750 crore ($1.
B) Industrial segment which consists of automotive paints. That was the result of the mass 64 . and paints for industrial sector. Asian Paints had a mascot called Gattu who was created by the celebrated cartoonist R K Laskhman. the company had a wide range of brands/sub brands. In the decorative segment. Decorative segment constitutes around 75 % of the total paint industry and Asian Paints is the market leader with around 44% share. Then the company realized that although volume justified the leadership position. the decision of the brand was taken by the builder/contractor and the home owners do not involve much in the process may be the decision of color rest with the house owners.These efforts made the brand a leader during the late sixties. But at that point of time. Paints are usually considered to be a low involvement product. The brand focused on mass and rural market. The focus of the company was on product innovation and service network and managing quality proposition. it is interesting to see how Asian Paints have changed the buying process of the product like paints. share of mind for the brand was very low. In the Industrial segment. Nerolac is the market leader. Asian Paints realized the need for brand building even during sixties. In earlier times.
The research revealed lot of interesting insights. these campaigns ensured an emotional connects with a Brand in a low involvement category. Rightly so because the industry was driven by channel driven promotions.The corporate campaign "Spectrum of Excellence" was aimed to increase the Salience of the brand in a quiet market. These campaigns effectively enhanced the brand equity of Asian Paints and established itself as a premium brand. Asian Paints initiated the corporate campaign aimed to position the company as the number one player in the industry. building a brand at that time was" uncommon sense". But this campaign failed to inspire any interest in the consumers and the company felt that the market is moving towards a commodity market where price is the most important differential. 65 . Research also confirmed that customers tend to repaint their houses on the occasion of festivities. During 1983. More than that. the company tried to reposition the brand as a premium brand. The campaigns were carefully crafted and there were different campaign for different regions. Consumers felt that paints could change the mood of the space and it was a sign of festival and plenitude. The objective was to upgrade to a more margin premium product marketer . The brand also phased out many subbrands and rest of the subbrands was brought under Asian Paint's umbrella brand.segmentation adopted by the brand. From this insight came the campaign of Asian Paints associating itself with festivals. Asian Paints undertook a consumer research aimed at understanding the perception of consumers about the product category. Thus born the campaign "Celebrate with Asian Paints". It could make a gloomy place bright and pleasant.
During the late nineties the brand had to be reinvented. The category was becoming less seasonal. Since many brands went after festival seasons. the positioning platform has become cluttered. From a low involvement category. More over the consumer buying behavior has changed. Because no longer festivities formed an important part in ones life. paint was increasingly becoming a high involvement category. The choice of color became a high involvement decision. The brand also went in a brand overhaul. The logo was changed to a contemporary up market one designed by Enterprise IG based in Singapore. sophistication and Technology. 66 . People started associating more importance to home decor and interiors. The logo/design was to convey self expression.
Punjab & Gujarat the body copy of the ad is in Hindi & Gujarati 67 . the campaign was highly localized and was different in different market. The latest campaign reflects on the color and uses the campaign “Har Rang Kuch Kehta hai" translated to "Every color has a story to tell”. Asian Paints is a classic branding story and the brand is still exploring and growing. Saif Ali Khan endorsed the premium brand Royale . Since the consumer scheme has been launched in Delhi. Kansai Nerolac Paints Limited The tagline ‘Style that makes a lasting impression’ elucidates long lasting benefits of both the brands. View Asian Paints ad here: Pongal :Saif Ad Taking a cue from the success of Ghar campaign.Thus came the birth of a wonderful positioning strategy created by O&M. The insight is that each color has a story to tell.For Apex Ultima. This campaign is a perfect example of a brand laddering up and connecting to a higher level in the mind of the customer. Hence “Har Ghar Kuch Kehta Hai" translated to “Every Home has a story to tell". The brand is so serious about the color that it has tied up with IIT to explore new colors and conduct research on colors. The insight was that the brand is about people and homes and homes reflect the people living in it. the brand took ownership of the COLOR. Along with the campaign Asian Paints also ran parallel ads for its subbrands. The campaigns reinforced The brand as a premium emotional brand.
Berger Paints: Natural colours SCHEMES:68 .
Schemes are considered to be one of the most important parts of the paint industry that’s why only top management people of the companies are entrusted with the Task of designing a scheme. Why is it necessary to give the schemes:• To attract the interested parties like dealers/retailers/painters/ contractors. In the paint industry the margins are not much in compare to some of the other industries. • To force them to push the products to the customers. Gift Schemes:69 . • To achieve a better sale of their products. • To provide them with some sort of incentives/motivation. that’s why the paint companies comes up with all sorts of schemes in order to attract all the interested parties. Almost all the schemes are designed in the headquarters and then they are distributed to the other branches.Schemes are a form of incentives or a motivation which are given to the dealers/retailers/ painters/contractors etc so that they can push the product of a particular paint company in the market. Types of schemes:Generally there are 2 types of schemes:1) Gift schemes. 2) Trip schemes.
and the painters & the small dealers with less amount of purchase receives lower range of gifts.30 to a Hyundai car or a Maruti car which is worth Rs. gifts are generally distributed on purchase of particular quantity of a particular product. • Items starting from the range of Rs.Gift schemes are the ones which are given to all the interested parties like dealers/retailers/contractors/painters etc.dealers & contractors who purchases in bulk are eligible for different scheme. The companies have different sets of gift schemes for different categories of people.30-5 lakhs are given as gifts to interested parties. Types of Gifts:• The Company gives various types of items in the form of gifts. Starting from a coffee mug which comes for around Rs. 70 .5 lakhs (approx. For example. All the gift schemes are designed by head office and are circulated to the other branches. The gifts are generally given on point system.) are given as gifts.
torch. watch. gold. tray’s. hot-pot. sound system. mug. caps. washing machine(diwali (including some high price schemes). gifts) Cash coupons. pen (including some high price etc. watch. 6 ICI Berger Nerolac TRIP SCHEME:Trip schemes are bigger form of incentives for the dealers/ contractors/painters compare to the gift schemes. T-shirt’s. dinner-set. steel plates. Cash coupons. The trip schemes are of following two types: 71 . 14 umbrella. radio. gold coin. gifts) Philips fm etc. cups glass. sweet pkts. key 7 chains. The targets which have to be achieved in order to avail the trips are not that easy. key chains. cup-plate etc. mug. fan. flasks. Tiffin box. of gift items given CD-player. T-shirts. walkman. bicycle. bags. dinner-set. DVD14 player. (including some high price gifts) T-shirts. Philips phone. brush.Companies Asian Gift schemes/ cash rewards Total no. silver. bicycle etc.
a) LOCAL TRIPS:Local trips mean trip schemes which are located inside India.) LOCATION (LOCAL TRIP) ASIAN Rs.4 lakhs VISHAKHAPATMAN ICI 12000 liters PURI BERGER 10000 liters. that’s why the paint companies also gives some local trip scheme so that the average & small dealers can easily achieve those schemes and can enjoy its benefit. It’s not possible for every dealer/contractor to achieve the huge targets set to achieve the foreign trip. Examples of the local trips provided by these paint companies are as follows:TARGET COMPANIES (POINTS/LITRE/Rs.1.5-2 lakhs BHUVANESHWAR 72 . GOA KNPL Rs.
b) FOREIGN TRIPS:Foreign trips comprises of places like Australia. Bangkok. Dubai. China.) RS. shopping). Europe. The entire trip is for free except for the personal expenses (e.45 LAKHS RS. The targets for achieving these trips schemes are very high.g. The chart given below shows the details of some foreign schemes given by the major players:YEARLY TARGET COMPANIES ASIAN (POINTS/LITRE/Rs.80 LAKHS ICI 50 LAKHS 60 LAKHS BERGER 150000 POINTS 200000 POINTS 75000-99999 POINTS KNPL 100000-149999 POINTS >150000 POINTS LOCATION (LOCAL TRIP) SINGAPORE EUROPE AUSTRALIA CHINA AUSTRALIA EUROPE BANKOK DUBAI AUSTRALIA 73 . London etc. so only the high profile dealers/contractors are able to avail these sorts of schemes. Only 4-5-dealers/ scheme are able to achieve such schemes.
I feel that this will have a positive impact on the overall economy. and Asian Paints. Quebec.” says Dr Mosongo Moukwa. the Indian paint industry too has been affected by the current global economic downturn. US has over 20 years of experience. The total contribution of the paint industry is anywhere between 1. Vice President-Technology. We have seen a direct co-relation of the growth of the paint industry with the growth of GDP in the country. It can also be a process to meet the demands of the consumers and make them come back for more. Armed with a PhD in engineering from the Universite de Sherbrooke. the GDP is expected to grow anywhere between 6-7 per cent. The government has already started taking steps to curb inflation by slashing the interest rates on home loan and excise duty.CURRENT PERFORMANCE OF INDIAN PAINTS & COATINGS INDUSTRY: Like all other industries. Cleveland.5 and 1. It is difficult to forecast whether during this year. R&D INITIATIVES IN YOUR COMPANY: R&D has played a pivotal role in the growth of “Innovation is not just the domain of technology development. During FY2008 -09. Canada. This effect was witnessed strongly during the third quarter of FY2008-09. the paint industry would witness a single digit or a double digit growth. this management graduate from Case Western Reserve University.75 per cent of the entire GDP. The current situation in India is quite volatile. He has been one of the driving forces behind the exponential growth of his company by way of commercializing 74 .
Navi Mumbai. Our technology and product development is focused on enhancing the performance of paints and coatings. The third reason was due to the use of new types of substrates in some industrial applications. The overall demand in the paint sector will continue to be positive and is likely to get impetus through factors like the low penetration levels of paint in India. increase in government focus on infrastructure development. Moukwa shares his perspective on the Indian paint & coating industry and the latest trends. Our company has always invested in research and development. We have set up one of the largest technology centres in the country for paints and coatings at Turbhe. Asian Paints. Secondly. developing new markets and introducing a diversified product portfolio. ENVIRONMENT-FRIENDLY PERSPECTIVE: In the wake of the constant change in the environmental legislations around us and the shift in the preference of the consumers who are demanding high quality and 75 .New technologies. These improvements have been initiated with a view to implement new functions into coatings. in order to create products with additional properties. there was a need to save energy and time and by forcing paint processing companies to reduce the use of volatile organic and hazardous compounds in coatings due to the environmental legislation of the US and the European community. In a tête-à-tête with Richy D Alexander. policies conducive to the growth of the construction industry.
This calls for hybrid materials with complex morphology and nano-composites and functional nano-particles. In the future. radiation curable and powder. our focus will continue to be on developing modern paints such as water based. • Sensor properties. followed by the fastest growth rate witnessed in powder coatings at 12 per cent in India. most research inputs across companies and research institutions will have to be focused in the following three coating functions: • Easy-to-clean properties. high solids. Coatings delivered in this manner are growing by at least 7 per cent. new functions are increasingly important for the generation of adjustable multifunctional properties in addition to the classical functions of paints such as protection and decoration. self-cleaning (anti-staining. We are also quite active in the powder segments. switch ability (measurement of and reaction to external stimuli) and • Defined flow characteristics and mechanical properties. activity. long-term stability. INDIA’S POSITION ON THE GLOBAL MAP IN TERMS OF COMPETITIVENESS 76 . The company has a strong portfolio of water-based paints for the decorative markets along with high solid coatings in the industrial segment. anti soiling) properties.environment-friendly products. In the next one decade.
The per capita paint consumption in India is still among the lowest in the world at over 1. In the US and New Zealand. it is as high as 25 kg per person. and look at the many unpainted houses along the streets.5 kg per person. This offers tremendous opportunity for us in India. I feel that there is a goldmine here. 77 . the figure is 15 kg per person. whereas in the Western Europe and Japan. As I drive through the streets of Mumbai.
RECOMMENDATION 78 .
increase in Government focus on infrastructure development and the increasing reach of small screen (television). 79 . let me give you some examples of what we are currently doing. Innovation also deals with our ability to provide simple manufacturing solutions And ensure the highest quality of our products. In that framework. Asian Paints Home Solutions which offers consumers a hassle-free painting experience is the world’s first painting service brand. We have constantly invested in products and systems which provide a direct link with the consumers. For example: Colour World is a new direction for the paint industry in the current age of retailing and provides the consumer with a service interface. This concept has few similarities in the world when you talk about paint companies.STRATEGIES TO COPE UP WITH THE CHALLENGES:Innovation is not just the domain of technology development. It can also be a process to meet the demands of the consumer and make them come back for more. policies conducive to the growth of the construction industry. We have recently opened up a new signature store near Mumbai to educate the consumers about colours. Most of our recent innovations have been focused on getting the consumer involved in the painting process. FACTORS DRIVING THE GROWTH We feel that the overall demand in the paint sector will continue to be positive and is likely to get impetus through factors like the low penetration levels of paint in India.
the shades which are going to dominate the Indian homes every year Indian paints are health hazards. Intensive research is carried out with interior designers.LATEST TRENDS CATCHING UP IN THE SEGMENT We feel that the Indian consumer is getting more and more involved in the painting process. Our company has entered into prediction of colour trends in India. The growth of exterior paints has been phenomenal in recent past. 80 . The study termed as ‘ColourNEXT’ Declares in advance. The demand for water-based paints is on the rise. A new trend that recently evolved has fuelled the demand for fashion finishes. architects and the fashion community to get a grasp of the trend and movements in colour every year. Emulsion paints have witnessed a positive growth in the recent times.
CONCLUSION 81 .
The commercial vehicles segment. the spurt in demand for paints was due to the rationalization of duty structures coupled with revival of growth in user industries. However. Since the early ‘90s. the demand growth was marginal and only picked up from 1993-94. all major players are putting up fresh capacities apart from expanding existing ones. This was the time when excise duties were lowered and import duties slashed. the production of paints has been fluctuating. a 82 . the growth surge of the previous year was not sustained by the paints industry due to the industrial slowdown and a cash crunch. As compared to a growth of 12 to 14 per cent posted last year. In fact. In the early 90s high excise levels made the products of organized player’s price uncompetitive against paints manufactured by small-scale units which paid no such taxes. in 1996-97. the domestic paints industry has been booming with growth rates moving into double digits.Over the last few years. In expectation of an upsurge in demand. Slowdown in decorative paints. The industrial paints are slated to grow at an annual rate of 10 to 12 per cent per annum for the next few years. for the next two years. Over the last three years. On the other hand. industrial paints posted a growth rate of nearly 15 per cent compared to over 20 per cent in the previous year. The two-wheeler industry has also registered a good show in the current year. the biggest chunk of the paints market resulted in industry sales turning sluggish. The industrial paint manufacturers would benefit from the burst in the passenger car sales. the decorative paint segment registered a lower growth of 8 to 10 percent. the production trend turned negative during 1990-91.
better distribution network and an ability to compete in the global markets would emerge victorious in the paint war. the paint industry is expected to show at least twice the growth of Indian GDP in the ensuing years. The industry is in a consolidation phase and only those Indian paint companies with a strong technical alliance. This has helped the organized paint Industry a lot. The reduction of excise duties from a high of 40 per cent to 16 per cent in the last five years has made the numerous small-scale units unviable. Considering the past trend. 83 .star performer last year with 33 per cent growth. the raising titanium dioxide prices and the negligible growth in agriculture this year will play spoilsport. as they no longer have a price advantage over the organized sector. is expected to average a growth of only 15 per cent this year. However.
com www.berger.nerolac.REFERENCES: www.com www.com www.asianpaints.com 84 .com www.google.wikipedia.
This action might not be possible to undo. Are you sure you want to continue?
We've moved you to where you read on your other device.
Get the full title to continue reading from where you left off, or restart the preview.