Renil J Kotak

PGP12262

Decision Sheet: chotuKool: “Little Cool,” Big Opportunity

Chotukool, a unique low-cost fridge, was about to be launched by Godrej & Boyce
Manufacturing. Co Ltd, a division of Godrej Group. The company is focusing on the 80 percent
of Indians who do not have access to a fridge, a region that has never been targeted previously.

Before persuading itself to develop, the corporation had two options: face competition fiercely
in the existing refrigeration market or come up with new ideas to establish a far larger market.
The latter was chosen because a low-cost refrigerator would not only be a solution for those
who could not buy traditional refrigerators, but it would also indicate a potential shift in
Godrej's strategic vision, and its success would be crucial.

According to the firm, if Godrej could reach 50 percentage saturation of the 80 percent of
Indian households who did not have fridges by launching a product sold at $69, it could create
$6.8 billion in sales.

Because of his extensive experience and dedication to Godrej, Sunderraman, an experienced

employee, was picked to lead the development of the refrigerator. His Godrej Innovation team
had worked hard to develop a marketable product; now they needed to determine out how to
market it. The difficulty comprised a thinly dispersed market, poor consumer earning power,
little user awareness, and a wide range of cultural variety.

The team had decided on two strategies after much contemplation:

1. Create a unified supply chain to transport the product from production lines to rural
retail shops. This approach would need Godrej investing in a completely new sales,
advertising, and distribution system in order to find new buyers, including the thousands
of mom-and-pop businesses spread all across Indian rural areas that appeared to be
potential clients for the product.
2. Continue with the rural strategy while positioning the fridge as an ideal lifestyle
company for metropolitan Indians. The initial market reaction to a soft launch indicated
that Indians were growing more ambitious, and that the urban sector might need less
integration and capital than the rural sector.