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INTRODUCTION

High priestess of sacred Indian temple meets English army officer whos unwittingly
strayed into holy ground. They fall in love. Her orthodox father vows vengeance Thats the
story of LAKME, a 19th century opera written by Frenchman Leo Delibes, from which Simone
Tata borrowed the LAKME (French for LAKSHMI, the name of the priestess).

The current size of the Indian cosmetic market is approximately US$ 600 million. Of this,
the fastest growing segment is color cosmetic, accounting for around US$ 60 million of the
market. Industry source estimate a rapid growth rate of 20 percent per annum across different
segment of the cosmetic industry reflecting an increasing demand for all kinds of beauty and
personal care product. Growth has come mainly from the low and medium-priced categories that
account for 90 percent of the cosmetic market in terms of volume.

Even with a 20 percent growth rate, the per capita consumption of cosmetic is very low in
India. Current per capita expenditure on cosmetic is approximately US$ 0.68 cents as compared
to US$ 36.65 in other Asian countries. However, with changing lifestyle, higher disposable
incomes, increasing advertising penetration of satellite television, awareness of the western
world and growing importance of beauty pageants, there have been significant changes and use
of cosmetic is on the rise.

LAKME, a brand originally introduced by the Tata group of Indian, now bought over by
Hindustan Unilever (HUL) of the Unilever group, Tips & Toes, another domestic player, and
Revlon dominate the US$ 60 million color cosmetic market. Multinational, Revlon of the U.S.
and LOreals Maybelline has a dominant share of the small premium lipsticks and nail enamels
market. Mass-market products account for a major share, while the premium segment accounts
only for a mere 9 per cent in lipsticks and 5 cent in nail enamels Lipsticks account for nearly a
third of the market at US$ 21 million, while the market for nail enamels is estimated at around
US$ 23 million. The color cosmetic segment is very competitive and has a high penetration level
of 80 percent.

The skin care market in India is estimated at US$10 million. Within the last decade, this
segment has seen many consumers slowly shift from the mass to the premium end of the market.
The penetration rate is high in skin-care segment as compared to color cosmetic. In the skin-care
segment, price and volume played an equal role in value growth. Moisturizing lotion, fairness
cream and face cleansers are the popular categories in the skin-care segment and account for
approximately 60 percent of the skin-care segment. The major players in this segment are
LAKME, Ponds, Fair & Lovely of the HUL group with a 50 percent market share, followed by
players such as J.L. Morison that markets the Nivea range of products in India, Godrej and
Revlon. Penetration levels of international cosmetic brand in India are still low. Foreign brands
currently constitute only 20 percent of the market. A major reason for low penetration of
international brands can be attributed to high pricing. These companies initially gained sales on
their international brand image, however, repeat purchases were not forthcoming price strategies
and to retain sales growth, several foreign companies reformulated price strategies to tap the
large Indian middle class. Urban women in the middle and upper income groups in the age range
of 23-50 is the groups for international brands, as this group looks for better products and is
willing to pay a premium for international quality products. Industry estimates suggest that are
close to 10 million such women in India.

INTRODUCTION TO COSMETICS INDUSTRY IN INDIA


India, with a population of nearly a billion people, is a country. Indias urban population is
the main engine that fuels the demand for various cosmetic products. The MORPHING of India
is subtle and changes are not visible for the first time visitor. However, the market liberalization
process that began in 1991, along with the crowing of three Indian as Miss Universe during the
preceding four years, have made Indian women conscious of their appearance. Consequently, the
cosmetic consumption patterns of Indian women have changed, and this trend is fuelling growth
in the cosmetic sector. The Indian cosmetic and toiletries market grew by 8.7% in current value
terms in 2001, with value sales amounting to Rs126 billion.

The market for cosmetics and toiletries in India is characterized by high volume sales of
low-end toiletry products, while at the same time the legendary emerging middle-class has
generally been fuelling demand for cosmetic and upper-mass toiletries. Products that are too
specialized have yet to be successful on the Indian market. Examples include toners, hand care
and other value-added skin care products, bath & shower products and aftershave balm. Only the
richest consumers can afford these; indeed, the average consumers may be unaware of their
purpose or even existence. This also explains the relatively poor showing of perfumes, especially
the premium variety.

This cosmetics and personal care industry has been growing at an average rate of 20 per
cent for the last few years. The growing Indian cosmetics market offers promising prospects for
international brands. The growth rate in the cosmetics market reflects an increasing demand for
beauty care products in India. Perfumes and fragrances, skin care, and hair care products are
some of the major segment with promising prospects for U.S. companies. Penetration of most
cosmetics and toiletries is very low in India. Current consumption of many products is well
below that of many countries in Asia. The low market penetration of many cosmetics and
personal care products offers room for growth.
INTRODUCTION OF LAKME UNILEVER PRIVATE LTD
LAKME is the Indian womens Beauty sutra inspiring expression of her unique beauty.
LAKME brings expert products and services that are borne out of true understanding of the
needs of the Indian woman. They help the Indian woman in expression of her best self-sensual,
original, expressive, alive and intuitive. LAKME inspires her to unleash the potency of her
femininity, beauty and sensuality.

KEY FACTS:
LAKME was the first major beauty brand in Indian and takes pride in bring the expert on
Indian Beauty for over 50 years. It is complete beauty brand spanning colour cosmetics, skin
care & hair styling products and extending to beauty services through the network the network of
LAKME BEAUTY SALON. Its bond with beauty and fashion is manifested through the
LAKME FASHION WEEK, which is now the largest fashion event of its kind in the century.
LAKME has a foot print of over 1200 assisted sales outlets, which is the largest span of outlets
with BEAUTY ADVISORS in the country.

OUR VISION:
Unilever products touch the lives of over 2 billion people every day whether thats
through feeling great because theyve got shiny hair and a brilliant smile, keeping their homes
fresh and clean, or by enjoying a great cup of tea, satisfying meal or healthy snacks.

A clear direction

The four pillars of our vision set out the term direction for the company where we want to go
and how we are going to get there:

We work to create a better future every day.


We help people feel good, look good and get more out of life with brands and
services that are good for them and good for others.
We will inspire people to take small everyday actions that can add up to a big
difference for the world.
We will develop new ways of doing business that will allow us to double the size of
our company while reducing our environmental impact.
Purpose & principles

Our corporate purpose states that to succeed requires the highest standards of corporate
behavior towards everyone we work with, the communities we touch, and the environment in
while we have an impact.

ALWAYS WORKING WITH INTERGRITY:


Conducting our operations with integrity and with respect for the many people,
organizations and environments our business touches has always been at the heart of our
corporate responsibility.

Positive impact

We aim to make a positive impact in many ways: though our brands, our commercial operations
and relationship, through voluntary contributions, and through the various other ways in which
we engage with society.

CONTINUOUS COMMITMENT:
Were also committed continuously improving the way we mange environmental impacts
and are working towards our longer-term goal of developing a sustainable business.

WORKING WITH OTHERS:


We want to work with suppliers who have value similar to our own and work to the same
standards we do. Our business partner code, aligned to our own code of business principles,
employees, consumers and the environment.
MEANING AND DEFINITIUONS PRODUCT MIX
The term PRODUCT MIX implies all the products offered by a firm for sale. It may consist of
one line products or several allied product lines.

Product line refers to an assortment or class of similar of related products and services.
They may be similar in technology, customers needs, channel used, market served or in some
other respect. An individual product in a line is knows as a product item. There are several
product items in a product line.

Product mix has three important aspects Width, Depth & Consistency. Width of the
product mix is measured by the number and variety of product lines offered by a firm. It shows
the degree of diversifications of a firms activities. The depth of product mix is determined by the
number of item in a product line.

By offering several brands of a product, a firm can cater to widely varying needs and tastes
of customers and thereby beat its competitor. For instance, the range of bathing soaps
(Lifebouy, Lux, Rexona, Liril, etc.) offered by HINDUSTAN LEVER LTD. Shows the depth of
its product line while the width of its product mix consists of Dalda Vanaspati, Close-up
Toothpaste, Talcum powder, etc. in addition to the soaps.

The consistency of product mix refers to the degree of similarity between product lines in
terms of their end-use, production requirements, price ranges, distribution channels, advertising
media, etc.

These dimension of the product mix serve as guides to decisions regarding the additions and
deletions of product item and line. By increasing the consistency of product mix, a firm can
reduce its costs of operations and acquire unparalleled reputation in the market.

Product mix or product assortment refers to the number of product lines that an organization
offers to its customers. Product line is a group of related manufactured or market by a single
company. Such products function in similar manner, sold to the same customer group, sold
through the same type of outlets and within a same price range.

Product mix consists of various product lines that an organization offers, an organization
may have just one product line in its product mix and it may also have multiple product lines.
These product lines may be fairly similar or totally different, for example Dish washing
detergent liquid and Powder are two similar product lines, and both are used for cleaning and
based on same technology; whereas Deodorants and Laundry are totally different product lines.
Two-way stretching means stretching the line in both directions if an organization is in the
middle range of the market.
Line Filling Decision It means adding more items within present range of the product line.
Line filling can be done to reach for incremental profits, or utilize excess capacity.

RESEARCH METHODOLGY
The research is based on:-

Primary Data

1) Questionnaire

Secondary Data

Internet
Company Report & Broachers
Magazines

Data is also gathered by talking to the respondents Target Audience, understanding their
beauty needs, what aspire them to go for the (LAKME) brand.

Also the level of:-

Brand awareness,
Price level,
Visibility of brand personality.
Expectancy of Communication

All these factors were the prime criterion for selecting (Which brand??), Short listing and
ranking (level of trustworthiness? Or most favored) which had helped us for identifying the
winner in cosmetics industry.

OBJECTIVE
1. Help in building a positive association with people thereby enhancing brand
personality
2. How to break the negative connotation of Being fashionable
3. Why has LAKME missed out on promotional gauge despite roping in top brand
ambassadors
4. How can the brand retain its lost spot?
RESEARCH DESIGN
Our research is based on the Exploratory Study.