[ABM

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Brand Audit | Berger Paints

Ashok Dutt Pant Manpreet Singh PGDM-IBM 2008-10

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83017 83028

FORE School of Management [ December 03, 2009]

CONTENTS

 History  About Paint industry in context to Berger paints  Market share  Parentage  POP and POD  Product attributes  Portfolio  Competition study  Customer Knowledge  Brand equity  Tie-Ups  Celebrities  Brand mantra  CBBE pyramid  Suggestions

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HISTORY
Though man has made and used paints timelessly, chemically formulated paints first appeared in the 18th century in Europe. Among the first to manufacture chemical paint was a German colour chemist, Lewis Berger in 1760 who entered paint business in London manufacturing dry colours using a secret process that every designer and household coveted. Usage: paint, today, is an axis that cuts across polymer chemistry, aerodynamics, oenology, metallurgy, ecology, architecture and engineering touching almost every point of modern science and technology. From interior and exterior walls of our home , to furniture, to white goods, to any industrial structure, any manufacturing or domestic equipments, any automobile, to any protective coatings for plant and machinery, dams and bridges, offshore oil rigs and even the numerous traffic signs that direct our way, hence we can view the diversity of paints.

PAINT MARKET With an estimated paint market of 1600 crore with organised sector of over 64%. Organised sector is then divided into Decorative: Home furnishing comprising 65% share and In Industrial products (General industries/protective/automotive/marine/powder coating) comprising 35% share

MARKET SHARE Overall 51% 18% 17% | | | Asian Paints Berger Paints Narolac paints

Decorative segment 58% 19% 10% | | | Asian Paints Berger Paints Narolac

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Automotive and general industries 48% 20% 13% | | | Narolac Paints Asian Paints Berger Paints

PARENTAGE
Lewis Berger and sons incorporated in 1879 and over the years the company grew to be the core around which amalgamated other pioneering companies in their own rights- Jenson & Nicholson, john Hall and British paints share a common destiny.

HISTORICAL MILESTONES
 1923: Hadfield’s India setup in Calcutta  1947: British paints buys Hadfield’s  1969: Sold to berger Jenson and Nicholson (UK)  1976: Bought over by UB Group  1983: British paints changes its name to bergerp paints india limited  1991: bought over by UK paint company  2000: Amalgamation of UK paints Rajdoot division with berger paints  2001: Acquires 100% share in Jenson and Nicholson (Nepal)  2002: Buys ICI’s Rishra factory  2005: Creaton of Lewis Berger

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POD | Points of Differentiation:
• • • • • History Variety Innovation in product offering Distribution and inventory management Committed Sales force

POP | Points of Parity:
• • • One of the early entrants in the world Durable and quality product Home paint solutions

PRODUCT RELATED ATTRIBUTES
In Decorative Paints, Berger has paints and paint systems for every application - interior, exterior, every surface, concrete, plaster, metal and wood - as well as special applications like water storage, etc. Berger acrylic brands like Luxol Silk and Rangoli for interiors, and Weathercoat for exteriors are quality leaders in technology and represent decor statements that redefined the premium category. Luxol Hi-Gloss is the national hallmark for excellence in paint enamel. In addition to these premium trendsetters, Berger offers paint users other attractive options across the price spectrum in every category - thus enabling buyers to make the choices most appropriate to their budget, always with the Berger assurance of the best quality for the price.

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PORTFOLIO

Enamels Luxol Hi Gloss Synthetic Enamel Luxol Duroglaze Rich Matt Enamel Luxol Lustre Enamel

Interior Wall Coatings Luxol Silk Luxury Premium Emulsion Rangoli Super Acrylic Emulsion Bison Super Emulsion Bison Acrylic Distemper Rangoli Easy Clean Emulsion

Exterior Wall Coatings Weathercoat Longlife Weathercoat Smooth 100% Acrylic Emulsion Weathercoat Textured Exterior Emulsion Walmasta Antifungal Exterior Emulsion Durocem Extra Waterproof Cement Coatings

Wood Finish Woodkeeper PU Clear Woodkeeper Melamine

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OPERATIONS
Berger paints as if in December 2009 have 7 Plants 80 depots | 10,000 retailers | Hence a PAN India presence

COMPETITOR | ASIAN PAINTS
Asian Paints manufactures and markets industrial and decorative coatings. The company's key products include the following: Products:  Interior wall paints  Exterior wall paints  Doors and window paints  Furniture paints  Metals paints  Industrial coatings Brands:  Utsav  Apex Ultima  Wall Fashion  Royale  Colour Next

Berger has a series of tie-ups for various purposes: • • • • Joint venture with Becker Industrifag. Berger allied with the Japanese major Nippon Paints to boost its OEM turnover Agreement with Orica Australia Pvt. Ltd. to produce new generation protective coatings. Tie-ups with Valspar Corp and Teodur BV for manufacturing heavy duty and powder coatings.

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CELEBRITY ENDORSEMENTS
There are no celebrity endorsements undertaken by Berger paints whereas Asian paint’s (market leader) Royale is endorsed by Bollywood actors Saif Ali and Soha Ali Khan. It is very recent that Berger is able to set up itself in the market; the time is now for Berger to grow and expand the market share post recession. Strategic tie ups will help Berger to gain and expand in the market pie of paint sector both in Decorative and industrial products.

Brand mantra: Paint your imagination Berger paints Customer knowledge: Royal | Quality | Expensive | Variety | Less penetration

BRAND MANTRA

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CBBE PYRAMID

Salience: Quality, Range, environment friendly Performance: Variety of products as per specific customer need Judgement: Quality at a price Reputation: New Entrant Feeling: high rate of customer Satisfaction Resonance: Market expansion and loyalty factor

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SUGGESTIONS

 Introducing Water – based Paints.  Repositioning of existing Brands in Rural Market.  Broadening of Distribution Network.  Adding more choices for shade effects and textures.  Enhancing Better Quality at a reasonable price  Demand will be generated through the new constructions coming in housing and industries.  Celebrity endorsement too can help to create a pull factor in luxury paints  Complete house solutions too can give a meta market comfort to a customer  To generate product awareness  Give an incentive to influencer to push/suggest product  To initiate trial for first time user  To explore alliances with worldwide paint majors to tap vast potential of the segment  Leverage the recent acquisition to be a strong player in the industrial coatings business  To expand and become the leading player in international emerging markets  Mass production and economies of scale should be trend used to reach international price

 Care should be taken while purchase of raw material as price trend in oil industry follows a cyclic order.

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