Hindustan Lever

Case Study - Marketing Management

Presented By :- Group 1
Ayan Banerjee PGP26086
Surbhi Sahani PGP26353
Mayur Mishra PGP26192
Vandhana Kumari PGP26380
Harsh Kaushik PGP26132
Ranti Dev Agarwal PGP26262
Abhinay Kumar PGP26008
Introduction To Case
HUL'S DISTIRBUTION
This Case Study Explains How HUL Built A Strong Distribution Network For Its Products
Through Smart & Effective Strategies Across India.

History Of Hindustan Lever

• HUL Began In 1888 When William Hesketh Lever Exported Sunlight Soap To India. It Was Officially
Founded In 1931 As Hindustan Vanaspati Manufacturing Company, Later Merging With Lever Brothers
India And United Traders In 1956 To Form Hindustan Unilever Limited.

• Currently HUL Products Touches 2 Of Every 3 People In India, As Of Today HUL Has 7000
Re Distribution Stockist Covering About 1 Million Retail Outlets Across Country.
The Main Issue Of HUL
Main Issue
The primary issue is the threat from private labels. Private labels (store brands) are gaining traction
in the Indian market, challenging Hindustan Unilever (HUL) by offering similar-quality products at
competitive prices while providing higher profit margins to retailers. This shift could reduce HUL’s
dominance in traditional retail spaces.

Challenges Faced By HUL

• Consumer Preferences: People are trusting private label brands more, which could change
market share. Which Is Currently 17-18% Of The Entire FMCG Market All Products
• Retailer Loyalty: Retailers prefer private labels because they make more profit (35%), so they
rely less on brands like HUL.
• Competition: Other FMCG companies are improving their strategies, making competition tougher.
• Urban And Rural Reach: HUL needs to ensure its products are easily available in both cities and
villages.
THREAT FROM PRIVATE LABELS
& ORGANISED RETAIL
• Private Labeling - Products Which Are Manufactured By The Store Itself, Having Equally Good
Quality & Price Range To Compete With National Brands. Ex - Amazon Fresh, Solimo , Reliance
Trends.

• Organised Retail - Retail Chains Like Reliance Fresh, Future Group Are Promoting Their Own
Priavte Label Brands Giving A Threat To HUL'S Products.

• Rural Consumer - 70% Of Indian Population Lives In Rural Areas The Per Capita Spend Is Low But
It Is A Huge Market

• Competition - When The Competition In Urban Market Is Fierce, The Rural Market Act As An
Background To Rely Upon
HOW HUL COULD COUNTER?
• Retailer Loyalty Programs: Offer competitive margins, exclusive product bundles,
and retailer-specific incentives to prevent switching to private labels.
• Focus on D2C Growth: Invest in user-friendly e-commerce platforms and
subscription models to connect directly with consumers and ensure steady revenue.
• Launch Innovative Products: Introduce trending categories like health-focused,
plant-based, or affordable eco-friendly products to capture evolving consumer
demands.
• Expand Digital Distribution: Partner with quick-commerce platforms and
strengthen rural reach through digital tools like mobile apps for micro-entrepreneurs.
• Drive Sustainability: Prioritize sustainable packaging and eco-friendly practices as
a key differentiator to attract environmentally conscious consumers.
Secondary Issues Of HUL
• Changing consumer preferences: Consumers are increasingly willing to trust private label brands,
leading to a potential shift in market share.
• Retailer Loyalty: Retailers prefer private labels due to higher profit margins, reducing their dependence
on national brands like HUL.
• Increasing competition: Other FMCG giants may also enhance their distribution strategies, intensifying
market competition.
• Urban vs Rural market penetration: HUL needs to ensure its distribution strategy remains effective in
both urban and rural markets.

Countering Them
• Focus on Consumer Needs: Promote trusted, high-quality products with affordable options to appeal
to a wider audience.
• Strengthen Retailer Relations: Offer better discounts, exclusive incentives, and regular engagement
programs to retain loyalty.
• Boost Innovation: Create unique products and eco-friendly packaging to stay competitive and relevant.
• Expand Reach: Increase rural presence through Project Shakti and urban sales via digital platforms.
• Counter Private Labels: Offer value-for-money product lines and collaborate with retailers to ensure
strong shelf presence.
Organised Vs Unorganised Retail
Organised Retail In India Is Still 2% Of The Market, Majority Of The Market Share Is Still
With Unorganised Small Retailers
• Neighbourhood Shops Have Dominated The Indian Retail Market For Decades & Is Threatened By
Organised Retail Which Is On Rise.

• Product Or Brands Kept In Retail Shelves Are Percieved As Cheap & Not Of Good Quality.

• Unorganised/Retail Shops Maintain Their Presence Even In The Most Remote & Untouched
Places Where Organised Retail Has Not Yet Been Able To Reach

• Unorganised Retail Has The Advantage Of Maintaining A Relationship With The Daily Local
Consumer
HOW WE CALCULATED MARKET
SHARE
HINDUSTAN LEVER TOTAL SALES IN ALL OF FMCG MARKET IN ALL CATEGORIES
= 59,144 crore (FY 2022-23)

THEN
TOTAL SALES OF FMCG MARKET OF ALL COMPANIES = 2 LAKH CRORE (FY 2022-23)

THEN WE CALCULATE

(TOTAL SALES OF HUL / TOTAL SHARE OF ENTIRE FMCG INDUSTRY) *100

(59144/2 LAKH CRORE) *100 = 29.79%

THEN WE GET HUL'S MARKET SHARE APPROX 30%

SUPER VALUE STORE STRATEGY
• SVS - Super Value Stores Collaborated With Local
Retailers/Stores Certifying Them As Branded Partners Of
HUL & Upgrading Them

• HUL Adopted This Strategy To Increase Its Distribution As

This Stores Have The Largest Distribution Reach In The
Country

• This Gives Edge To Small Retailers From Competition From

Organised Retail By Providing Better Experience To
Consumers

• This Would Help HUL To Reach To The Largest Consumer

Base In India With The Most Robust Distribution Channel
PROJECT SHAKTI TO PENETRATE RURAL MARKET
• 70% Of India Lives In Rural India So When The Urban Market
Competition Is Fierce FMCG Companies Depend On The Rural
Market

• Project Shakti - To Penetrate Rural Market HUL Supporting

Women In Rural Areas With Micro Credit Facilities, Giving
Them Mass Market Products To Sell To Rural Consumers

• Project Shakti Is Now Present In 12 States & More Than

50,000 Thousand Villages

• HUL Is Planning To Reach 600 Million Rural Consumers In 5

Lakh Villages By Recruiting 1 Lakh Shakti Enterpreneurs
HLN & PROGRAM VIJETA
• HLN - Hindustan Lever Network Is HUL Own Direct
Distribution Arm Started In 2003.

• It Is Company Own Direct Selling Arm Working On The

Concept Of MLM (Multi Level Marketing) Where Any
Anyone Can Be A Part Of HLN Network

• Currently HLN Works In More Than 1500 Towns With

More Than 3.5 Lakh Consultants

• Program Vijeta - Started In 2002 Aimed To Build A

Strong Network Of WholeSalers

• HUL Collaborate With Direm Marketing Services To

Launch Loyalty Program For Wholesalers Of HUL
LAKME BEAUTY SALONS
• HUL Started Lakme Salons Offering Premium Services &
A Unique Experience To The Consumer On Behalf Of The
Brand Lakme

• Professionals Here Are Trained By Lakme Academy &

Indirectly Promote Lakme Products To The Consumers

• There Are Currently Over 71 Locations In 21 Cities

• These Salons Become An Effective Distribution Channel

For HUL Products
AYUSH THREAPY CENTERS & BEVERAGE
VENDING MACHINES
• Launched in 2002, and more than 40,00,000 households are
reported to have tried it and 50% became repeat customers

• HUL collaborated with Arya Vaidya Pharmacy to set up Ayush

Therapy Treatment Centers

• These centers provide personalised health advice and therapy,

including positive health and stress relief, aches and pain
relief, consultation for weight reduction, skin and hair care.

• 50% Discount on Women’s day.

• HUL Setup 15000 Vending Machines All Over The Country

Serving Products Like Tea & Coffee For Easy Access To
Consumers
Thankyou!
Presented To - Prof Hitesh Manocha

"Products Are Created In Factory But Brands Are Created In Minds"

- Walter Landor