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SDM-Live Project (Mid Review)

Reckitt Benckiser
Submitted by, Group No. 4 (Section B)

Live Project Mid review

Company: Reckitt Benckiser

Group No. 4B

Project Objective
To increase the penetration of RBs condom brands - Durex & Kohinoor, in urban & rural channels.
Key deliverables
1. Understanding efficacy of current model via questionnaire during trade visit.
2. In-depth competition analysis.
3. Current gap identification and solution.
4. Viable solution to increase penetration in rural and urban channel.
Project Background

RBs condom brands-Durex & Kohinoor, along with other major competitors, form 60% of the Indian
condom market (the other 40% being the government subsidized brands e.g. Nirodh).
Kamasutra holds the second largest market share in India (after Nirodh).
For RB, the major contribution in sales comes from East region, including Bihar & Jamshedpur.
Kohinoor is the brand, which is on a higher selling end, with 86% of total sales coming from Eastern parts
of the country. Durex is the low selling brand, however, it is showing a positive trend, with AugustSeptember,2013 sales being 1.5 times those of Jan-Feb, 2013 (company data).
Total chemist channel coverage in Jharkhand is 37%. Target is to cover 797 distributors by November
2013, across Jharkhand

Work done & findings

C&F

Distribution channel structure of


RB at Jamshedpur

The Mother godown


is located in Kolkata

The major channel through


which RB sells its condoms is the
Chemist Channel, with around
Distributors
95% of the sales happening
(2 Retail & 1 Pharma)
Modern Trade
through this route. We have
Distributors function is divided
The large modern trade retailers
based on the type of stores they
source their products directly
covered the Chemist Channel in
are going to cover
from the godown
Jamshedpur area by conducting
field visits along with the
salesperson.
The
city
of
Retail Channel
Chemist Channel
Jamshedpur is divided into ten
The two distributors are
The distributor has employed 2
divided based on geographic
areas i.e. Adityapur, Sakchi,
sales persons to cover the
area
retail channel
Bishtpur,
Sonari,
Mango,
Gamahria, TELCO, Golmuri, Kadma and Jugsalai. The salespersons visits five areas in a week (each area has
roughly 25 to 30 chemist shops), one day is spent for the wholesale channel (wholesalers form a major chunk of
the sales) and has holiday on Tuesday. We have visited chemists shops in these areas to understand the channel
better, to interact with the retailers/ salesperson and also to understand the routine of the salesperson. Through
the field visits we were focusing on the following aspects by observation and questionnaire for the retailer:
1. Availability and visibility of the products in the store: We found out two kinds of behavior from the
retailers. One set was very open to the idea of displaying the condoms in a see through glass at the counter or
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Live Project Mid review

Company: Reckitt Benckiser

Group No. 4B

at some visible location inside the store. The other set was very conservative in terms of display and were
giving reasons of either frequent visit by women/kids to their store or there were lady employees in large
numbers.
2. In-store promotions: RB was not having any in-store promotion material for their condoms category. Only
at a couple of locations we could find A3 size posters of Kohinoor at the entrance of the store. In contrast to
this Manforce (a product of Mankind Industries) was placing danglers in a large no of chemists shops which
helps in promoting in store conversion. Also considering that the consumer in most cases does not ask for a
particular brand in this product category having a dangler increases the chances of purchase. It was found that
even the Udaan stores (stores billing more than Rs. 10000/- per month of RB products) did not have any instore promotion material.
3. BTL activities: At the time of visit there were no incentives running on condoms sold by RB. The general
perception of the retailers was that other companies have better incentives compared to RB. This could be due
to the strong brand value of RBs products but in a category like condoms where the retailer plays a very
important role, absence of incentives has a negative effect. For example, the retailers were happy with the
offer of a branded product like camera / shoes on bulk purchase rather than jars/ umbrellas being provided by
RB on a smaller quantity purchase.
4. Trade schemes: The major factor deciding which brand the retailer pushes is the margin/scheme the
company provides to the retailer. RB was currently providing a 30% margin to the retailers in comparison to
10 + 4 offer provided by Mankind and 12 + 3 offered by Moods. This shows that Mankind was providing the
maximum margin among the major players and in line with our expectations retailers were more ready to sell
Mankind condoms.
Other observations:
1. Few of the retailers were favoring brands which provide them with sticky price points so that they dont
have to cater change. For e.g. A 5 pack of Kohinoor sells for Rs. 25 whereas the price points for Manforce are
maintained at multiples of 10 for all SKUs.
2. RB in contrast to most of the competitors does not provide any credit to the retailers. This again can be
attributed to the strong brands created by RB but in categories where there is a weak customer pull retailers
would not prefer to stock large quantities of Kohinoor/Durex.
Future Work
The following are the tasks we look forward to complete as part of this project:
1) Investigating the rural channel: Understanding the rural channel in the form of sales visit & beat activities
at the rural stockiest, distributors & retailers. Identifying the current gaps with respect to the competition, as
well as RBs urban channel in the form of incentive schemes, margins & point of purchase promotions
2) Competitor benchmarking: Understanding the competitor practices (man force) including their sales
strategy, distribution outreach and promotions at retail.
3) Distribution efficacy: Analyzing the current shortcomings and gaps (stock-outs, channel clogging) at the
distributors and wholesalers and suggesting the necessary recommendations to improve the same.

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