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Final Project Report


Group 6

Executive Summary
Aim of this project was to apply the learning from marketing class and based on that develop a marketing
plan for chosen brand. To do that we chose the product Asian Paints Royale and explored the various
product related aspects. The detail analysis consisted of 5 stages
1. Detailed analysis of product based on situational analysis
2. Evaluation of marketing strategy for previous years
3. Review of current marketing strategy
4. Comparison with marketing plan of competitor brands
5. Developing marketing plan for next year
In the first phase of analysis we did situational analysis based on 5Cs Company, customers,
Competition, Collaborators and context. With this we were able to identify opportunities, threats etc.
Based on data collected from various sources we were able to evaluate marketing strategies. We evaluated
Segmentation schemes, target segment and rationale behind the target group.
Based on that we understood positioning of the product. We compared this competitors and understood
how asian paints royale differentiates from its competitors. We did 4P analysis and product, price, place
and promotion of the Royale. Our analysis was based upon data collected through asian paints
spokesperson, social media pages and official reports.
To predict the future strategy for marketing we looked through previous annual reports figured out what
cost and timelines were involved in the project. Based on that we prepared schedule of activities and
expense forecast. Financial projections for 2014 were also part of these predictions.

Asian Paints is Indias largest paint company and Asias third largest paint company, with a turnover of
Rs 96.32 billion. Asian Paints was established on February 1, 1942 by Champaklal H. Choksey,
Chimanlal N. Choksi, Suryakant C. Dani and Arvind R. Vakil. They name their company The Asian Oil
& Paint Company, a name that picked randomly from a telephone directory (Wikipedia)
1945 Asian Paints touches a turnover of Rs. 3,50,000 (Wikipedia)
1957 66 The family-owned company makes the change to a professionally managed 3eflon3d33on.
Forbes Global magazine USA ranked Asian Paints among the 200 Best Small Companies in the World
for 2002 and 2003 and presented the Best under a Billion award, to the company. Asian Paints is the
only paint company in the world to receive this recognition. One of the countrys leading business
magazine Business Today in Feb 2001 ranked Asian Paints as the Ninth Best Employer. It has been
recognized by Economic Times as well. Forbes has also ranked Asian Paints among the Best under
companies in Asia in 2005, 06 and 07.(Wikipedia).
Asian Paints has acquired 30% stake in Dutch Boy Philippines from Berger International Limited (BIL),
an indirect subsidiary of Asian Paints.
Gattu, the mascot:
Gattu, the mascot for Asian Paints was created by cartoonist R.K. Laxman in 1954. Soon Gattu, with his
shock of black hair eternally dangling over his right eye, became popular and remained so for many
decades, even featured in business quizzes. After over four decades, it was eventually phased out after
2002, when companys advertising agency Ogilvy & Mather (O&M) initiated a rebranding
Logo Change:
The logo was changed to a contemporary upmarket one designed by an Engineering Student
Devanaboina Krishna Teja from Andhra Pradesh. The logo/design was to convey self-expression,
sophistication and Technology.Thus came the birth of a wonderful positioning strategy created by O&M.
The insight was that the brand is about people and homes and homes reflect the people living in it. Hence
Har Ghar Kuch Kehta Hai translated to Every Home has a story to tell. This campaign is a perfect
example of a brand laddering up and connecting to a higher level in the mind of the customer. The
campaigns reinforced the brand as a premium emotional brand. Along with the campaign Asian Paints
also ran parallel ads for its subbrands. Saif Ali Khan endorsed the premium brand Royale .For Apex
Ultima, the campaign was highly 3eflon3d3 and was different in different market.(Wikipedia).

Major Product and Services:

1. Decorative paints:
Exterior wall paints (Apex Ultima, Apex Exterior Emulsion, Apex Duracast, Ace
Wood surface paints (Woodtech Emporia PU, Woodtech Polyester, Aquadur PU for
interiors, PU palette Interior, PU for Interior, Melamine Gold Clear, Melamyne,

Touchwood Interior Glossy, Premium Semi-gloss enamel, Premium Satin Enamel,

Premium Gloss Enamel, Utsav Enamel)
Metals surface paints ( Premium semi-gloss enamel, Premium Satin Enamel, Premium
Gloss Enamel, Utsav enamel)
2. Industrial coatings:
Protective coatings,
Floor coatings,
Road markings
3. Ancillaries:
Wall primer,
Acrylic Wall Putty,
Exterior Wall Putty,
Wood Primer
4. Automative Paints:
Asian paints made a foray in automotive paints in the year 1997 with a joint venture with PPG
Industries. The joint venture is called PPG Asian paints.[7] The company manufactures body
coatings and plastic coatings.
We chose Asian Paint Royale as our Product for the project even though its the market leader for the
following reasons:
It still has almost about 50% market to capture.
It is being projected as a premium product and premium product has the capacity the affect the
overall share of the company more than any non-premium product.
The premium product consumer can afford to paint more frequently.
It can tap unorganized paint sector also(about 10% of total market share).
The percapita paint consumption in India is around 1.5 kg while the same in developed countries
is about 20kg, as the per capita income is on the rise here also we have huge market potential.

5 Cs

Paint industry is 250 billion rupee industry dominated 75% by decorative segment. In an organized
market share of asian paints is 47% (Company, Media reports). Decorative segment has 4 product
categories- Interiors, exteriors, woods, metallics. Interiors has further subcategories of distemper,
emulsion and textures. While distemper is targeted to economy and mid range consumers royale is high
end emulsion product. Royale has upmarketed with its product Royale Play.
Collaborator :
Asian Paints has harnessed the powers of state-of-the-art supply chain system using cutting edge
technology to integrate all its plants, regional distribution centres, outside processing centres and branches
in India. The Supply Chain Management in Asian Paints is backed by IT efforts that help the company in
demand forecasting, deriving optimal plant, depot and SKU combinations, streamlining vendor
relationships, reducing procurement costs and scheduling production processes for individual factories.
PPG Industries Incorporated (USA) ,largest producer and supplier of automotive coatings to major car
manufacturers had 50-50 joint venture incorporated on 19th Feb 1997 with Asian Paints. PPG Asian Paints
is engaged in the business of manufacturing and marketing automotive and Industrial paints.

Asian paints has always been market leader in India. Closely followed by akzo nobel- Dulux velvet touch.
Value proposition for Dulux velvet touch is the glow and finishes that product gives to walls. Another
major product in this sector is Nerolac impression. Impressions are differentiating itself with its product
offerings. Its product offering include Nerolac Impressions eco, Impressions Disney, impressions Disney.
Consumer Trends:
With rise in purchasing power capacity of Indian consumer. Consumers are moving towards more
premium products. Market for high end premium product accounts for 1/5th of total market which has
been growing at rate of 25-30% per year.(Media sources)
Consumer are reliable on dealers and contractors for decision of choosing the paints. This trend is slightly
changing with more speciality stores coming up and providing painting services to consumers. Current
market share for this product is 42%. Asian paints has interactive customer paint guides that has helped to
reshape customer paint purchase decisions. Reasons for this has been more consumer participation in
paint selection decision through interactive tools like Paint calculators, online colour visuals which
company has facilitated.
Climate :
Political factors:
1) General elections are going to be held shortly so political logjam in anticipation of elections
be ruled out.
2) Recent correction in price of commodities and crude oil provide optimism.
Technological Factors :
1) Eco friendly product range launched by Nerolac
2) Smartcare range (Waterproof, Crack bridging) products are in more demand
Economical Factors:
1) Euro financial crisis and US economy signaled growth revival
2) Depreciation of rupee raises the cost of raw material


Social Factors:
1) Increase in purchasing power of consumers resulting in preference of cheaper brands






Royale is premium
product of Asian


Major competitors
of Asian Paints
Velvet Touch and
Nerolac Impressions

anticipation of
elections cannot
be ruled out.
and crude oil

like festivals etc
purchase decisions
of the product.
Repainting cycle
time has reduced to
3-4 years for pre

Royale is stretched
into brands like
royale play royale
shine royal lustre

Management is
backed by IT
efforts that help
the company in

Market share of
asian paints in this
segment of premium
products is 42%
nerolac is 9 percent
and others are 14

1) Depreciation
of rupee raise
the cost of raw
2) Euro financial
crisis and US
6eflon6d growth

Royale has been

targeted to 30+
married residence
owners. This is
quite evident from
promoted by Saif
Ali Khan

Product is available
colours.Product is
anti-bacterial and
6eflon protected

PrPPG Industries
has 50-50 joint
asian paints

nerolac impression
is it hides the cracks
towards emotional
connect with the
customers through
its innovation.

1) Eco friendly

durable utility on
which stains can be
wiped,erased and
remove. Targeting
promoting longer
life of walls..

Trend Analysis:
Indian paint industry is expected to grow at 1.5 to 2 times GDP growth rate for the next five years which
opens up more avenues for Asian paints to capitalize on. With GDP growth rate at about 6% top players
in all segments are expected to achieve growth rate higher than that of the market growth rate. The per
capita consumption of paint in India is 1.5kg which is very low compared to the developed countries
where it is about 20 kg. With Indian government introducing schemes like NREGS, farm loan waivers,
pay commission led salary hikes consumption in both rural and urban market is sure to improve. Despite
these positive figures Indian paint industry may experience a slow growth as a demand for homes, offices
and cars is threatening the industry growth. A strong supply and distribution channel followed by
aggressive promotion is required to overcome these unprecedented situations that may arise in the future
in the paint industry.
Asian Paints Royale is a 100% acrylic, water based paint used for interior wall finish
The silky sheen finish that Royale offers gives the interiors a regal feel
Brush marks seen after painting will be low as Royale gives a smooth flow
Since Royale offers high stain resistance- walls can be cleaned easily and will look new for long
Royale Anti-Fungal property is an added benefit
Royale covers about 325-350Sq.Ft/litre, has a drying time of 15-20 min gives a soft sheen finish
with a shell life of 3 years
Market Statistics: Royale has 42% market share in the premium segment closely followed by
Nerolac velvet touch with 35% the rest is evenly distributed between the other products
Royale offers two product varieties Royale Play with different effects for Premium customers and
Royale for economy segment where it projects its advantages like stain resistance, anti- fungal,
Since Royale is being positioned as a premium product it is priced to appeal to the high income
and upper middle class section
Pricing strategy adopted is value based pricing
Price range is between Rs 315-345 per litre
Asian paints has a wide distribution platform that it has developed during these years
It has 4 manufacturing plants, 6 regional distribution centres, 55 depots with around 15000
dealers who have around 90000 sub dealers
Asian paints have around 3000 exclusive retail stores around the country and 4500 color world
Asian Paints bypassed bulk buyer segment by directly selling to the individual paint consumers
Asian paints have used high profile bran ambassadors like Saif Ali Khan, Akshay Khanna, Soha
Ali Khan to position itself as a premium segment product
Public relations part is divided into two parts:- Marketing public relations which includes
handling the meetings of dealers and painters, Corporate public relations which involves
monitoring CSR, Media and investors
Sales promotion includes distributing merchandise to painters such as T-shirts, caps..etc, giving
incentives to painters and also forming a privileged club member society
External promotion is also done through internet Asian paints site itself has many tools to catch
the customers eye
Asian paints also sponsor big events like Star Screen Awards and Sharad Sharma.

Marketing Strategy and Program for previous years:

Asian Paints has been doing great evident it being the market leader. Nomura Securities notes that in the
past decade the company has gained market share.
Marketing Strategy:
Staying involved with the customer.
Using customer help line
Offering Complete home-painting services: including Exterior walls, Interior walls, metal
finishes to furnitures also.
Sending out Happy Painting Guides to customers for free.
Providing color consultancies: an employee with interior-design training comes to the home to
suggest what can be done for the walls.
It also trains 8,000 painters a year in two-day workshops to ensure that they apply its premium
paint the right way.
Offer 200ml samples of its premium paint at a nominal price, allowing a customer to paint small
part of a wall to see how the color will look which is much more effective than a shade card.

General info:
Raw materials cost is around 56%
Weaker rupee could hurt Asian Paints margins given that crude derivatives (titanium oxide) are
its key inputs.
Asian Paints have increased ad spends marginally this year and will maintain the same at an
above-industry average for another couple of years

Peak Season is usually between December to January and during non peak seasons ,dealers are
encouraged to sell more by giving exciting offers like LCD Tvs and Foreign tours.

50% of the sales happens through the Engineers and Contractors

newly paint houses contribute to 25% sales

Repaint takes around 10-15%.
Figure 1: Trend of sales for paint mark



Through Contractors
new houses



Critical view of current marketing strategy and comparison with competitors strategies:

Competitive Product: Nerolac Impressions Velvet Touch

Asian Paints Royale:

Target is 30+ married residence owners

Marketing Campaign: Wall that takes it all

Communication Objective: Idea of Timeless beauty. Idea is to project Royale as a paint that
improves the life of walls.

Consumer insight here is to keep customers want their walls to last longer. More target customers
being urban elite

Nerolac Impressions

Launched a Youtube campaign where it showed

how Teflon coating of the product did wonders on
the walls painted by Asian paint. This Marketing
stint attracted almost 3.5 customer views and
campaign led to sale of 104 million liters of sale of
royale paint.

Launched a new initiative Paint the Change to

promote its low VOC (volatile organic
compounds) products. Many customers
attached to this campaign resulting in increase
of sales(10-13%) of Nerolac Eco Friendly

Promoters directly interact with consumers through

mall activities in various cities

Nerolac launched unique Vastu Colour Book to

attract consumers

Asian paints have come up with specialty stores

like Colors, Colour world. Store is aimed at
helping people with painting process in choosing
colors and finishes.

Nerolac has come up with stores called-Style

zones. This has been beneficial and has reaped
up twice sales as compared to multibrand store.

Asian Paint provides home painting service where

Asi Nerolac provides service in 6 different cities
customers need not have to refer to contractor. It across India.
has this service in 13 different cities across India.

Painting is high decision involvement process and

for that Asian paints have improved its customers
interactions to assist them by introducing schemes
like Call Aparna.

Interact with consumers using customer care

number and mails

Online reach of Asian paints has not been up to the

mark compared to its competitors (199084 fb
likes). It has tried to advertise itself on social
media. Asian paints talks more about color theme
and has been able to create much impact with the

Nerolac Paints in terms of social media

presence, is much better than asian
paints(494787 fb likes). The theme here is to
talk about styling and architecture through
which this has been able to attract more activity
on social media.

Setting of an ambitious and realistic marketing objectives for next year:

Linking the new movie releases with Asian Paints-creating new ad :
Advertisements serve various purposes.
Marketers use advertisement as a communication tool for:

Information: Here, the purpose of the company is just to inform the consumers about
its products.

Persuasion: These advertisements try to convince the consumers to buy that product by
explaining the benefits associated with its purchase
Reminder: These advertisements are shown with a purpose to encourage the consumers
to repeatedly purchase that product.

Reinforcement: The purpose of the advertisement is to make the consumers aware of

the fact that they have made the right decision in choosing this product.

Since Asian Paints is already a market leader in the Paints industry, the aim of these
advertisements would be Reinforcement.
Expense: 10-15% of the gross margin
2. Making a dedicated page on FB for Asian Paints Royale
Presently there is a common page for all the product offerings of Asian Paints. A separate page
dedicated to Asian Paints Royale can be created and be used to carry out online competitions,
discussions etc linked specifically with Royale.
Expense: No extra cost as the page can be created on Facebook free of cost
3. Setting up a counter/ area at Malls-To carry out interactive activities such as make your
own design
The idea is to set up an interactive kiosk/counter in mall. A wall will be put up where willing
people can come and create textures. They can also leave their hand prints on this wall.
In addition, a painting competition can be organised for children and the paintings made by them
will be put up on a wall painted with Asian Paints Royale.
Expense: INR 30,000 + 15% of sales
4. Training program for a dealer whose shop has a reduction in sales:
Due to increasing competition and clutter in the paint industry, a particular dealer in a particular
locality may not be able to achieve the required profit margin. It is essential that a company looks
into this problem and solves the same. This can be done by conducting training programmes for
the dealers.
Expense: 12.5% of the sales
Converting a multi brand dealer of paints into an exclusive Asian Paints Dealer by giving him
Since we have free market policy, Asian Paints cannot force a dealer to sell exclusively Asian Paints. He
may choose to sell Nerolac, Dulux, Shalimar in the same shop if he earns a higher margin by selling all
these as against selling Asian Paints alone.
In such circumstances, Asian Paints can offer the dealer more incentives/commission. Thereby, the dealer
would choose to sell Asian Paints. If the commission that the dealer obtains by selling Asian Paints is
higher than that obtained by selling the other competing brands, the dealer may consider becoming an
exclusive Asian Paints dealer.
Expenses: @3% of sales

Financial Projections

Based on data of past three years we have made predictions of year 2014. For that there were few points
of consideration and assumptions. Assumptions are as follows

1) We have formulated CAGR based on past 3 year performance and predicted future performance basis
of other factors discussed in previous sections of this report.
2) Note that the growth is as companys average rather than individual product average of royale. We
assumed product share in total revenue and have based our assumptions on this fact.
Growth rate has been phenomenal from 2009-10 to 2011-12 averaging 24 % but in 2012-13 growth was
12 percent. Further depreciation in rupee may further bring down the growth but the price of raw
materials is going to decrease due to less demand from European and Asian market. Predicting exact
revenues thus in coming year is very difficult and we have assumed a similar growth rate in next year too.
Figure 2: Revenue from operations(cr)

Premium product market in india is currently 13500 cr with CAGR 20% as per industry reports. Market
share for various products in this category is given as below. So even though though the conditions are
weakening for the paint industry the projections are still considered better. Asian Paints have come up
with new Royale Aspira product and there is excitement regarding this in high end market. With 5600
crores of revenues coming from Asian Paints royale we are expecting overall rise of 20% growth as per
industry average. Market share will probably be same for this product and may fluctuate little. Royale is
market leader in premium products segment and its market share has not changed much over the past few
years. It has been growing from 35% in 2009 to 43% in 2013. Competitors are trying to improve their
sales and match up with Royale but Asian Paints considering its huge size has a strategic advantage of

expenditure in marketing and advertisement. With the potential of this sector we predict a sales growth
for Asian paints royale less than past years due to adverse external conditions for industry. But still based
on analysis and marketing strategies adopted we can say that healthy growth rate of 15% minimum can be
achieved. Over the past few years growth has been 20-25% and so this growth is highly possible.

Total Income

FY 2013

FY2012 FY2011

127386.4 110770.8 96322.4 77223

Total expense 110826.1 96370.56 81219.5 63914.3


16560.23 14400.2

15102.9 13308.7

So considering the revenue in FY2012 and FY2011 we have predicted growth of 15%. The potential
income for next period is as mentioned in the table. The expenses calculation is very complex procedures
so we have averaged the expenses over last two years and based on that data and our marketing strategies
we have suggested that expenses in marketing will increase.
Worst case analysis we take expenses to be 87% and based on those total expenses can be extrapolated as
shown in chart above.
Previous years income statement is given below and due to limitation of knowledge of taxing, debt we
had to restrict overselves to calculating Profit before taxes and interest.

Figure 3:Premium paint market share

Quarterly sales projections:

Company has projected lower growth for future period on account of fall in economic conditions. Though
company should expect a better sales in monsoons and Diwali so Q3 results for next year can be projected
to be higher in that respect as compared to quarter 2.

Data of past 3 years is shown below. With depreciation in rupee further in Q2 of 2013 results are expected
to be even down.
We assume a Q2 results to match somewhere along Q1 results.
Q3 results should have GR of 21-29%. We have projected this growth on the rationale that as
Demand for premium products has definitely increased as compared to previous years when
growth was 21 percent. But as rupee has depreciated and cost of raw material has also shot up the
Q3 results would see growth of 29% which it saw in FY2012 Q3.

Figure 4: Projected sales

Thus we analyzed that the future sales and revenue of the company based on marketing strategy . Our
predictions were based on publicly available information that we received through company reports,
spokesperson and news reports. Any internal data might be there which may be different from what was
made available to us that may cause discrepancy in projections as per company.


Marketing Management: Philip Kotler,14th ed.
Management Accountion: Anthony, Hawkins, Merchant. 13th ed.