Hi.,

In the year 2012, the hair care segment in India increased by 18% in current value terms, toRs 11,600 crore. Within this segment, the hair colorants category saw the fastest value growth of 29%, and stood at approximately Rs 2000 crore. This translates into roughly 17% of the hair care market, by value.

In India, hair colorants have proven to be the hair care industry’s crowning glory. Once primarily used to cover grey hair, hair colorants have today emerged as a lifestyle statement.

An analysis of the drivers for growth of this market include rising disposable income, growth in awareness and fashion consciousness, increasing media penetration and a tremendous rise in organized retail. An expanding distribution network ensures that more and more people have access to these products, while mid-priced brands and smaller packs have been launched to tap into the high-potential mid-market segment. Moreover, beauty no longer remains a domain restricted to women; it has gone beyond and encompassed males who are spending more on grooming products.

Despite all of the above factors, the key challenge faced by this sector is the perception that most hair colorants contain harmful chemicals that adversely affect the quality of hair in the long run. To combat this, companies have introduced ammonia-free hair colours and colours with certain natural ingredients like olive oil and aloe vera, which have led people to become more

amenable to using them.

Fig 1: Percentage Sales of Hair Care by

Category: Value (2012) {Source:

Euromonitor International}

Category

% Sales

Hair Oils and Conditioners 41

Shampoos 36

Colorants 17

Salon Hair Care 4

Styling Agents 2

The Delivery Formats

Hair colorants are available in a variety of delivery formats, namely:

Powder-based

Cream-based

Oil-based emulsion

Shampoo-based

Liquids

The genesis of the Indian hair colour market was with liquid hair colours. Powders gained acceptance post the launch of Godrej hair colour powder in a sachet, creating new levels of access due to low down price and simplicity of use.

Through the 1990s, the popular hair colours were powder dyes or oil-based liquids. In 1997, L’Oreal launched its premium brand Excellence Crème, which introduced the concept of hair colour other than just the regular black and dark brown in an easy to apply form. They also launched their Salon Business, aimed at getting the “experts” (stylists / barbers etc.) to endorse the crème format and the L’Oreal brand.

However, even today, powder hair dyes comprise the biggest segment in this category, by volume, followed by cream based hair colours. In terms of franchise, the powder franchise is approximately 10 times the crème franchise (in terms of the number of households using).

Delivery Format Value-Base Share

Powder based 45-50%

Cream based 25%

Fig. 2:  Delivery Formats: Value Share (Source: Business Standard, 2012)

According to industry estimates, powder hair colour constitutes 45-50% of the hair colour market by value and is growing at 15 per cent yearly. Cream hair colour constitutes 25% by value of the hair colour market and is growing at about 20% yearly. This growth is partly because of the sensorial appeals as well as the modern image that this format has.

The market segments: Salon v/s DIY

The hair colorants market has two distinct segments – the professional colouring service offered by salons and the DIY at-home hair colour market.

L’Oréal Professionnel, followed by Schwarzkopf and Wella, dominate the professional market. This segment has seen steady growth, predominantly in metros, since the tier two market consumers are slower to warm up to the relatively higher pricing of these colour services.

However, it is the at-home hair colour market that has really excited the big marketers. It is the market that is generating the highest volumes for most of them, but it is also the segment that is facing stiff competition as many national and international brands compete for consumers’ share of mind, heart and wallet.  Some key brands in this market have been indicated below.

Brand Shares: The at-home market

Godrej Consumer Products Limited (GCPL) is the overall market leader in the hair colour category, deriving nearly 15% of its domestic revenues from hair colour. Though it has dominated the powder hair colour segment in India with a market share of 33% in this segment (Source: AC Nielsen), however it has yet to obtain a firm footing in the cream hair colour format.

Currently, the top end of the hair colour market in the cream segment is dominated by L'Oreal (60%) followed by Streax (9%). The colour cream category is skewed towards the urban metros while the powders are being used mostly by Tier 2 and Tier 3 cities.

Vasmol from Hygienic Research Institute Pvt Ltd tops the emulsion-based segment with a 91% share by value. Indian hair colour brands such as Godrej Kali Mehendi, Black Rose Kali Mehendi (Henna Export Corporation), and Indica (CavinKare) contain natural colouring agents such as henna/mehendi and thus are perceived to provide a more ‘natural’ way to colour hair.

Brand Company 2009 2010 2011 2012

Godrej Hair Dye Godrej Consumer Products 26.0 25.8 24.2 23.3

Super Vasmol Hygienic Research Institute 17.0 16.0 15.8 15.6

L'Oreal Excellence

CremeL'Oreal India 10.8 10.8 10.8 10.9

Garnier Colour Naturals L'Oreal India 5.0 5.3 5.6 5.6

Indica Cavinkare 4.0 4.2 4.3 4.6

Godrej Coloursoft Godrej Consumer Products 4.0 4.3 4.5 4.6

Streax Hygienic Research Institute 2.3 2.0 2.0 2.0

Revlon Colorsilk Modi Revlon 0.9 0.9 0.7 0.6

Others Others 30.0 30.7 32.1 32.8

Total Total 100.0 100.0 100.0 100.0

Fig 4: Brand Shares by Value (in %) (Source: Euromonitor International)

Godrej Hair Colours

Godrej was one of the pioneers in the hair colorants category. It launched its first hair colour brand – Godrej Liquid Hair Dye – in the 1970s. Used in those days with some degree of hesitation, it did become a category leader and laid the foundation for the market-to-come. In keeping with market developments, Godrej added to its portfolio in 1981 by developing and launching a hair dye in powder form.

In 1995, it revolutionised the market by packaging its hair dye in an economical, easy-to-use, convenient-to-carry sachet format called Godrej Powder Hair Dye. In rural India, which is traditionally price sensitive, it had an open sesame effect. Its unique selling proposition put succinctly in its communication – Kaato, Gholo, Lagaalo (cut, dissolve, apply) – helped it establish unquestioned leadership.

Godrej Expert

In 2008, Godrej Powder Hair Dye was re-launched as Godrej Expert Powder Hair Dye and carried with it the promise of a much-needed product innovation. The colour lock formulation technology developed by Godrej enabled colour molecules to cover every hair strand for a long-lasting, natural look. Simultaneously, the mildly perfumed conditioner nourished hair and made it soft and shiny.

In 2011, a further re-launch provided a range of innovations. Godrej Expert Original is the basic black hair colour (with the largest hair colour consumer franchise in India), Godrej Expert Care (a henna based colour with the goodness of henna and amla) and Godrej Expert Advanced (powder that forms a gel); the flagship gel innovation that took care of all the fundamental powder format challenges – non-drip, triple conditioner, and great hair feel.

Another innovation in the Expert hair colour franchise was the launch of the Godrej Expert Rich Crème in 2012. For the first time in India, a crème hair colour was made available in convenient pre-measured sachets. It is available in five shades, and is enriched with the goodness of aloe-protein which keeps the hair soft & shiny. Expert Rich Crème also offers a complete one-stop solution by way of a Hair Colouring Kit (colour sachet + developer sachet + hair colouring brush + mixing bowl + gloves + ear caps + stain removal wipe + conditioner) to hand-hold the first timers. Godrej Expert Rich Crème is affordably priced at Rs 59 for the Kit and Rs 30 for the single use pack (colour sachet + developer).

Product Price Format

Godrej Expert Original Rs 15 / sachet Powder

Godrej Expert Advanced Rs 15 / sachet Powder

Godrej Expert Care Rs 20 / sachet Powder

Godrej Expert Rich Crème

Rs 30/ sachet

Rs 59 (for the kit)Cream

Fig. 3: The Godrej Expert Range

Other Cream-based hair colours from Godrej

Apart from Godrej Expert Rich Crème, Godrej has two other cream-based hair colour brands, namely Godrej Colour Soft and Godrej Renew.

Godrej Colour Soft is positioned as a gentle hair colorant that guarantees a pleasant colouring experience. The built-in conditioner gently penetrates the hair during the colouring process and strengthens it. The post-colour Moisture Lock conditioner gently refreshes every strand, locking in moisture.  Colour Soft offers a complete hair colouring kit which includes a 40 ml colorant, 40 ml developer lotion, 4 post-colour conditioner sachets of 24 ml, a measuring cup, an instruction leaflet, a pair of gloves and a protective cape.

Godrej Renew cream hair colour is a breakthrough formulation which conditions hair, not once but twice resulting in twice the shine and softness. It contains Aloe + Hibiscus conditioners that protect and revitalize hair while colouring. The special after colour conditioner provides nourishment and moisture to coloured hair, giving it a healthy shine. It is available in two sizes. 50 ml priced at Rs 125 and the new 20 ml pack priced at Rs 55.

Henna and henna-based colours from Godrej

In their natural hair colour range,  Godrej Nupur is a 100% natural hair colour while Godrej Kali Mehendi and Godrej Kesh Kala contain natural colouring ingredients such as mehendi and other herbal extracts to give a ‘natural’ colouring to hair.

Key Competitors in the cream hair colour segment

Brand Celebrity

in Ads

Key Differentiators Type and Constituents Price per kit

No. of shades

L’Oreal

Excellence

Crème

Aishwarya

Rai

Contains a 3X formula – Ceramide

which protects, Collagen which

restores and pro-keratin which

strengthens

Permanent colour, 100% grey

coverage, contains ammonia. The

pack consists of a protective serum,

colorant, developer and conditioner.

Rs 559 10+

L’Oreal

Casting

Crème

Gloss

Sonam

Kapoor

Targets younger consumers who want

to get stylish, glossy looking colour.

Semi-permanent colour, no ammonia,

50% grey coverage. The pack

consists of a colorant, developer and

conditioner.

Rs 529 10+

Revlon

ColorsilkNone  Imparts luminosity to hair.

Permanent colour, contains ammonia.

It consists of a colorant, developer

and conditioner.

Rs 350 10+

Godrej

Renew

Contains the goodness of Hibiscus

and Aloe vera

Permanent colour, 100% grey

coverage, contains ammoniaRs 125 4

Garnier

Colour

Naturals

Karishma

Kapoor

It has a nourishing cream formula and

contains olive oil.

Permanent colour, 100% grey

coverage, contains ammonia. The

pack consists of a colorant, developer

and conditioner.

Rs 155  5

Godrej

ColoursoftMild and gentle hair colour No ammonia Rs 140 5

StreaxSonakshi

Sinha

Its key ingredient is Walnut Oil which

helps strengthen and imparts colour.

It also has a Kera-Vit formula which

conditions hair.

Permanent colour, 100% grey

coverage, contains ammonia. It

consists of a colorant, developer and

conditioner.

Rs 120 17

Godrej

Expert

Rich

Creme

Perizaad

ZorabianContains the goodness of Aloe Protein

Permanent colour, no ammonia, pre-

measured sachetsRs 59 5

*The italicized Godrej brands are not on air.

Fig. 4: Key competitors in the cream hair colour segment – an overview

The Communication Tasks

To  strengthen Godrej’s leadership position in the hair colour market in the face of new age competition by:

oBringing new users to the category through the Godrej hair colour product portfolio

oDriving format up-trades within the Godrej Expert Brand

To build relevance of the brand in the mind of the consumer through impactful and innovative brand building initiatives.

The Communication Challenge

Godrej Expert currently faces the following major challenges:

Despite being the largest franchise in India it is seen as the category default. Its strength on Godrej Expert Original is linked strongly to the low price. The strong identification of consumers with Godrej Expert Original makes their acceptance of premium / value creating propositions from the brand a slow burn.

Godrej Expert is seen as a great entry point for consumers who enter the category. However, whenever they upgrade, they tend to switch to competing brands such as L’Oreal, etc. that are seen to have more brand sheen.

Thus, the key communication challenge here is to propose a strong positioning & differentiation to build the brand image of Godrej Expert vis-à-vis competition.

Key Deliverables

The task is to provide a communication strategy  that details the way forward for Godrej Expert which would help build the brands in the most effective manner. The strategy document must provide solutions to the following key areas:

1 Identify key challenges for the brand and its communication.

2 Identify key characteristics of the target consumer.

3 Identify the key consumer insights in the target group.

4 Identify the right positioning and right communication message for the brand.

5 In addition to conventional channels, suggest communications activities and activities for the brand.