Marico is a leading Indian Group in Consumer Products & Services

in the Global Beauty and Wellness space. Marico's Products and Services
in Hair care, Skin Care and Healthy Foods generated a Turnover of about
Rs. 23.9 billion (about USD 478 Million) during 2008-09. Marico markets
well-known brands such as Parachute, Saffola, Sweekar, Hair & Care,
Nihar, Shanti, Mediker, Revive, Manjal, Kaya, Aromatic, Fiancee, HairCode,
Caivil and Black Chic. Marico's brands and their extensions occupy
leadership positions with significant market shares in most categories-
Coconut Oil, Hair Oils, Post wash hair care, Anti-lice Treatment, Premium
Refined Edible Oils, niche Fabric Care etc. Marico is present in the Skin
Care Solutions segment through Kaya Skin Clinics (95 in India and The
Middle East) and its soap franchise (in India and Bangladesh).

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Marketing policy

Marico is an organization, which is flat with only five levels of

reporting between the Managing Director and an operator on the shop
floor.
Marico believes that a flat structure helps them in being more
responsive to the environment while providing enriched roles for their
members. The structure defines clear roles and supporting relationships
but is by no means rigid. Keeping in mind the fast and ever changing
business environments, Marico's structure is dynamic and constantly
evolving.
Marico believes that all their efforts and strengths MUST mean a
better quality of life for their consumers as the maxim "Consumer is the
King" is sacrosanct in this organization. “We strive towards this goal by
constantly evolving new methods and practices that enhance the quality
of our service.”

The uncommon policy of marketing

Advertising is commonly understood in its narrowest commercial

context making it seem more superfluous than necessary and more hype
than relevant. Both its study and practice often focus more on what is
advertising and how it is done, ignoring vital aspects like why it works.
This unique book instead looks at the key aspects of advertising from a
holistic perspective of brands and marketing. It is designed to equip young
potential marketing and advertising professionals with all the fundamental
and conceptual aspects required to produce quality advertising in the real
world. The book explains and simplifies hardcore advertising and
marketing concepts while taking the understanding of advertising to a
higher level of insightful learning. This is done in part through the
introduction of fresh concepts and terms in a novel way. The author also

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highlights the criticality of consumer insights in developing great
advertising and how and where to

look for tem. The book is aimed largely at beginners and students, as its
down-to-earth approach will help newcomers be better prepared to start
their careers in the advertising and marketing world. This is because it
draws more from the real and practicing world of advertising, rather than
from the theoretical one.
The Uncommon Sense program equips businesses to make desired
changes in their operations and empowers them to become sustainability
leaders in their communities and industry sectors.
To graduate from UnCommon Sense, each business is required to
complete assignments from each module and prepare a final presentation
and written report that summarizes their actions and operational
improvements. Businesses achieve points for completing these action
items, and a minimum number of points are required to graduate.
Examples of the action items include conducting waste stream audits and
measuring waste stream, baseline energy and water audits and use
tracking, calculating CAFÉ measure (Corporate Average Fuel Economy)
and conducting a greenhouse gas inventory.
Businesses are required to document and quantify all action and
operational improvements made. Upon completing the course, they
compile all documentation and action items and present to the group. This
information comes in many forms: spreadsheets and tracking matrices,
graphs, work plans, surveys, communications strategies, mission/vision
statements, resource lists, job descriptions, photographs, policies,
marketing materials. The intent of this reporting is to actually quantify
what a business was able to achieve over the two- year period.
Each graduating class is profiled in an Uncommon Sense annual
report highlighting their accomplishments and positive changes over the
two-year course. This report will detail each business’ individual

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accomplishment and how the participants’ collective efforts are improving
the region’s economy, communities and environment.

o Stop playing at the margins; re-think everything.

o Build the firm around the 5- to 8-year associates, servicing partners
and similar talent.
o Move the firm to the suburbs and sell the artwork / cut the non-law-
related overhead.
o Reduce attrition of mid-level and senior associates and servicing
partners, especially because the investment in them is so great and they
are capable of delivering real value.
o Hire far fewer first year associates and actually train them and pay
for their learning curves, as opposed to staffing them randomly in and
out of client work, and seeing which sink and which swim, which is a very
expensive and wasteful management technique.
o Balance mentoring/training against hiring experienced lawyers –
plan in advance who you want to train and bring up in the ranks, versus
who you want to go out and “buy” who’s ready to hit the ground running.
o Look at tiers because most firms are too flat: contract lawyers, flex
plans, remote workers, paralegals, non-legal staff, etc. Not just
associates who have to become partners and partners who have bill with
very high returns (or else they have no home at the firm and are
considered off track/out the door).
o Create a service culture. Don’t just value legal skills if they are
divorced from business savvy or personal skills or communication skills,
etc.
o Stop competing solely for the top graduates from top law schools –
broaden the search and look for matches specific to the firm’s (and
clients’!) needs.
o Provide clients with “boots-on-the-ground lawyers.”

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 o Develop different groups of lawyers by skill set (rather than just by
practice expertise), such as some who are like contractors and can do
research, contract writers, discovery experts, investigations leaders, etc.
o Make money on volume and length of relationship.
o Offer alternative means of compensation for firm lawyers when
appropriate to the client’s objectives and pricing concerns.

Market status

Marico's focus on sustainable profitable growth is manifested

through its consistent financial performance - a CAGR of 24% in Turnover
and 27% in profits over the past 5 years- while setting a record of several
consecutive quarters of year on year growth- 38 for Profits and 34 for
Sales.
Over the past 17 years, Marico has been constantly improvising and
building new brands.
Marico's Consumer Products Business houses well-known brands
such as Parachute, Saffola, Sweekar, Hair & Care, Nihar, Shanti, Mediker,
Revive, among others, which occupy leadership positions with significant
market shares in most categories- Coconut Oil, Hair Oils, Post wash hair
care, Anti-lice Treatment, Premium Refined Edible Oils, niche Fabric Care
etc.
Every month, over 70 Million consumer packs from Marico reach
approximately 130 Million consumers in about 23 Million households,
through a widespread distribution network of more than 2.5 Million outlets
in India and overseas.

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MARICO STEPS UP TOPLINE GROWTH – UP 28%

Marico recorded a turnover of Rs 601 crore during Q1FY09, a growth

of 28% over Q1FY08. The growth was across all its businesses (consumer
products in India, international business and Kaya skin solutions). More
than half of the growth – about 15%- came from volume expansion. During
the quarter, Marico achieved a Profit after Tax (PAT) of Rs 46 crore, a
growth of 15% over Q1FY08.

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Consumer Products Business – Domestic:

Parachute continued to maintain its leadership in India. Parachute

commands a 48 per cent market share by volume in a Rs 1,300-crore
market, of which another 6 per cent was gained by acquiring Nihar from
Unilever. Revenues from Parachute in 2007-08 were Rs 620 crore. The
Saffola refined edible oils franchise grew by 28% in volume over Q1FY08,
led by Saffola Gold. The volume growth was boosted by the introduction of
a new variant, Saffola Active. Even as the brand operates in the niche
super premium segment of the market in India, its strong and relevant
proposition ensures a broadening consumer base. Saffola, accounted for
Rs 286 crore in revenues for 2007-08
The Hair Oils category experienced healthy growth. As in the past,
the company has focused on rigid pack sales of its portfolio. Marico’s hair
oils in rigid packs grew 26% in volume over the corresponding quarter in
the previous year. During the quarter, Marico commenced the prototype of
Parachute Advanced Night Repair Cream and Maha Thanda Hair Oil. Other
new products recently rolled out include Parachute Advanced Starz, Hair &
Care Almond Gold and Saffola functional food for Diabetics.
Marico generates 75% of its revenue from domestic FMCG, which
has been largely unaffected by the current slowdown. Marico's "Parachute"
brand has maintained market share over the past two years, with volume
growth of 11-12% pa driven by the consumer shift from loose unbranded
oil to branded oil. The positioning of "Saffola" edible oil has been
successfully transformed from a ''curative'' product to a ''preventive''
measure, thus driving increased penetration.

Market share and the Rank of different products:

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International Business:

Marico’s international business grew by 37% during Q1FY09. In its

traditional markets (the Middle East and Bangladesh) the FMCG business
continued to grow and record share gains. In Bangladesh, Parachute
coconut oil extended its market dominance backed by strong marketing
support. During the 12 months ended May ’08, its market share was 69%.
The thrust on expanding the franchise of Parachute hair cream in the
Middle East continues. A refurbished campaign for the anti-dandruff
variant of the cream was launched targeting Asian Males in the GCC
region, helping in capturing the “problem solution” user segment. The
Egyptian brands, Fiancée and HairCode currently enjoy a market share of
62%. The process of integration of the business in South Africa is
progressing well. During Q1FY09, Marico South Africa, led by the brands
Caivil, Black Chic and Hercules clocked a turnover of Rs 14 crore.

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 International Business growth over the years:

Kaya:

In December 2002, a New York – based company asked Mariwala if

he would be interested in selling laser hair removal machines. At first,
Mariwala was not impressed – the product could be commoditized too
easily. But what emerged was the idea of a service offered around such
machines. Mariwala had found his entry to the skincare business through
the concept of COSMETIC DERMATOLOGY. The next year, Kaya Skin Clinics
was set up as a subsidiary of Marico. The year before Kaya’s birth,
Hindustan Lever had launched Ayush Centres. It had also tried to make
headway with a launderette service and Lakme Salons. But where the
Rs.10, 245 crore FMCG giant seems to be slow-mover at the service game,
the Rs.953 crore Marico has covered some good ground.
The goal was to convert Marico into a beauty and wellness company
that would not be a victim of brand and price wars.
The Confederation of Indian Industry (CII) estimated the size of the
beauty and wellness market at approximately Rs 12,500 crore. So the

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move to launch Kaya (body in Sanskrit) skin care seemed a gamble that
could pay off.
In the two years since its launch, Kaya has set up 37 clinics in India
and two in Dubai. At these clinics, it claims to have serviced more than
50,000 patrons. It has also launched its own products, like a skin
lightening complex, under eye gels, and a recharging night crème.
Together, these products brought in 15 per cent of Kaya’s Rs.18.6 crore
revenues last year. The company, though, is still bleeding - the
accumulated losses run to Rs.12 crore. But these are the early days of a
fast – expanding business that incurs a lot of capital cost; each clinic costs
Rs. 1 – 1.5 crore to set up. The good point is that the early ones are
reaching cash break – even in 9 months.
During Q1FY09, Kaya recorded a turnover of Rs 36 crore, a growth of
62% over Q1FY08. Revenue growth in clinics in India in Q1FY09 that were
operational in Q1FY08 too was 25%. Kaya introduced a Deep Pigment
Reducer Peel under its skin renewal system in Mumbai. The results have
been encouraging and the service has been extended to Delhi with plans
of a national roll out during Q2FY09.At the beginning of FY09, 108 skin
clinics were operational, 95 in India and 13 in the Middle East. During
Q1FY09, Kaya has opened 4 new clinics. Three of these are in existing
cities. Kaya is now offering its services for the first time to customers in
Lucknow. In the Middle East, a new clinic was opened in Sharjah. Kaya is
well on track to open about 15 clinics during the year. Kaya Life offering
holistic weight management solution which was launched in FY08 currently
has 3 centers – all in the city of Mumbai. About 40 per cent of people in
urban cities are obese and there is a great demand and potential for this
business.

Development of products and market

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 Kaya Ltd was an entrepreneurial leap of faith marking Marico's
entry into skin care solutions business. It was a true reflection of
uncommon sense for a company in hair care products to move, instead of
merely logical product extensions, straight into skin care services. It
attempted to leverage Marico's strengths in the Personal Care business
and in-depth understanding of the needs of the Indian consumer and
her/his desire to enhance her/his natural beauty with the best cosmetic
dermatology procedures available internationally.
Kaya Ltd. has been focused on meeting the emerging needs of the
modern day consumers by providing useful and effective services in the
beauty and wellness space. The pioneering effort has been in the
area of skin care with Kaya Skin Clinic. For over 5 years Kaya Skin Clinic
has refined the standards and professionalisms of the skin care industry
through innovative, world class treatments and services that have been
tailor made to suit Indian skin.
Today's consumer is awakening to the benefits of health and
wellness. Changing lifestyles and the fast pace leading to deterioration in
overall health and the growing obesity in the country led us to launch our
new initiative Kaya Life. At Kaya Life we have created an innovative
approach to a healthy lifestyle through effective, holistic, healthy and
customised weight control solutions. With Kaya Life the aim is to raise the
bar higher and create a new brand of weight control centers that deliver
on the Kaya promise of trust, safety, dependability and achievement of
personal goals in weight control.
# A lot of research has gone into setting up Kaya. Marico’s
innovation cell first tested the concept through a mock clinic in its own
office. At the clinic, all the parameters that would go into creating the
aspired ‘Kaya experience’ were tested – from client greeting, to the walk –
through, to the doctor’s presentation and the bed design.
# For ensuring safety, it has used equipment approved by the US
Food and Drug Administration. For ensuring proper use, it has kept 100

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dermatologists on a retainer basis. The 300 odd skin practitioners’ have
been put through 300 hours of training at the company.
# Every consumable used during a service is disposable, and the
standards of cleanliness are maintained scrupulously ensuring that the
services are carried out in the most hygienic manner.
# The concept is of a medi-spa. The ‘medi’ part gives results
through dermatologists, and the ‘spa’ part provides the experience. This is
where Kaya differs from the positioning of an Ayush or even an
independent dermatologist dispensing the same services.
# Kaya is creating a new experience space that goes beyond
skincare products and services. Kaya has been designed around how
customers want to interact and the outcomes they desire.
# All the parameters that would go into creating the aspired “KAYA
EXPERIENCE” were tested for complete customer satisfaction before being
implemented.
# After an in depth marketing research by IMRB, Kaya realized that
people go for skincare treatments to feel good and get pampered. Hence a
combination of superior quality tangibles and an array of exclusive skin
enhancement services is being offered. The end result being the creation
of a unique concept of MEDI-SPA.
# The biggest differentiating factor in case of services being
provided by Kaya is that of VALUE CREATION and INNOVATION, leading not
only to customer satisfaction but sheer customer delight.

Brand building and promotion strategy

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 Marico spends more than 10 percent of its sale on the sale
promotion and advertisement on its various products.

As the above chart shows the material costs are same but the
advertisement and sales promotion expenditure has decreased this year.
This is because most of the products of Marico are at the maturity stage of
the product life cycle where people are aware about the product and
therefore it not necessary to advertise or promote the product the way
done at the introduction stage.
Kaya has still not reached the maturity stage of the product life
cycle and therefore Kaya is focusing to increase the market share (which is
currently 22%).
Kaya will spend 10 per cent of its total advertising and marketing
budget on the digital medium. The brand will use digital marketing to
expand into the health and wellness space with professional weight control
centers called Kaya Life
The Kaya skin clinic venture is expected to contribute as a strong
growth engine for sales and profits and help Marico move up the value
chain through high value added solutions.
Kaya launched the ‘Bridal Campaign’ – offering specialized skincare
services customized to the needs of to-be brides and grooms. The
objective was to: create awareness for the Kaya bridal packages, educate

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consumers about the possibility of glowing skin, and position Kaya’s
services as scientific solutions; a step ahead of home remedies.

Target Customers:

• Primary Customers:
– Young women
– Age group of over 22 years
• Secondary Customers
– Young men
– Age group of over 25 years
• Psychographics:
– Well educated; appreciates scientific processes
– Seeks options; but makes informed choices
– Individualistic; Values customized offerings
– Information seeking; Actively looks out for solutions

Bride
(Primary
customer)

Target
Audience

Relatives – Groom
Mother, Sister, (Secondry
etc customer)

What Marico did?

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 Marico plans to open up to 45 outlets of its beauty and wellness centre
Kaya Clinic in the next three years, besides setting up a manufacturing
facility for hair care products by the end of this fiscal.

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Bibliography:

-www.marico.com
-Marico’s Annual report 2008-09
-Marico’s Information updates
-Marico’s Media release
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