CASE STUDY

SUBMITTED BY:-MAYANK VYASNIKITA MISHRAPULLA MANOJEETHSHONIT MITTALSUBIN B CHANDRANSEC : A

SURVIVAL STAKES

INTRODUCTION

Western India Cosmetics (WIC), a cosmetic company, was established in 1992 at Aurangabad (Maharashtra). It was acquired by the Excelsior Group, Rs. 1000 crore company whose core business is liquor.

Excelsior acquired WIC as a part of a deliberate diversification strategy because of the risks faced by its core business.

Excelsior Group - The Current Scenario

Excelsior Group, Is A Rs 1000 Crore Conglomerate

Its Core Business Is Liquor, Diversified Into Real Estate, Consumer Products, Finance Etc.

Acquires Western India Cosmetics(WIC) To Further Diversify.

It Is Diversifying To Overcome The Threat Of Prohibition On Liquor Sales In Different States (Such As AP, Haryana).

Liquor Business Under Threat Of Possibility Of Take-over

Liqour70%

Real Estate10%

Finance10%

Consumer Product6%

Others4%

Sales

PROBLEMS FACED BY WIC

• Burdened with unsuccessful brands.

• Little product differentiation.

• Labor strikes and bloated workforce

• Relatively less market share

• Erratic support by the parent company i.e. Excelsior.

Annual Sales of WIC Brands

Bharat Herb Wash Bonjour Sparkle0

5

10

15

20

25

30

Annual Sales in Rs. crore

BHARAT• Medium-priced, ayurvedic and ethnic soap.

• Direct competition from Chandrika(South India) and Medimix(Pan India).

• Implicit threat from Mysore Sandal and Santoor but neither of them are ayurvedic products.

• Flat Market share.

• Bread and Butter for the company.

Solutions/Improvements

• Add new features to the product by adding new ingredient like assortment of healing oils.

• Introduction of smaller sizes to cater to lower-middle class as well.

Sparkle

A premium/high-priced soap.

Currently on a refreshing soap platform.

Quite unsuccessful in product positioning.

No proper promotional campaign.

Solution/Improvement-

1. Short term strategies- Focus on product

design and packaging.

2. Long term strategies- Divest the product

Bonjour

1. Toilet Soap

2. Annual Sales : 5 Crores

3. Half Dead Product

4. No sign of revival

5. Lack of adequate promotion

Solutions/Improvements

6. Discontinue Production

7. If there are lack of buyers,

Invest only in day to day operations

and slowly divest.

HERBHerbal Toothpaste

1. Has Gone Down Well With Consumers

2. Occupies A Place In The Competitive Market

3. Competitors : -

High-end : Close Up And HUL; Gel Toothpaste

Medium : Colgate

Low : Babool

4. Lacks New Idea

5. Not Having Idea Of Shifted Into Gel Tooth Paste

Solutions/Improvement

• Follow The Strategy Of MARKET PENETRATION, Launch The Product In Sachets.

• Market Development Strategy By Launching Product As Tooth Powder In Rural Areas.

Col-gate

Close-UP

Colgate Gel

Pep-so-

dentPromise

Babool

Others

Sales

WASHDetergent Powder

1. Annual Sales : 8 Crores

2. Competitors :

High-end : Ariel, Surf Ultra

Low Priced: Ariel Supersoaker, Rin Power White, Nirma & Wheel.

Others : Shudh, Henko.

3. No Money To Made At Top End

4. Flanks Covered By Other Players

Solution/Improvements

• Remove The Product From the Portfolio.

36%

26%10%8%6%2%12%

Sales

Nirma WheelSurf Ultra Ariel Super

SoakerRin Power White

Ariel Super Soaker

Others

PRESENT PRODUCTS NEW PRODUCTS

I. Market Penetration (Intensive Growth)

III. Product Development (Intensive)

Increase Market Share Sparkle

Herb and Bharat Product reformulation strategy

Feature Addition-Anti Bacterial

Convert nonusers into usersAdvertise their Health benefits

Product feature additions strategy

Offer product in different colors

II. Market Development (Intensive)Herb

IV. Diversification

Target new segmentsToothpowder for consumers of rural area

Introduce ayurvedic shower gel

Launch herbal mouthwash

Ansoff’s Model

(Market Expansion Grid For WIC)

Present Market

New Market

Questions

Should WIC phase out its existing consumer products and bring in its current range of products or retain them all?

Should it sell of its assets and cut its losses before it is too late?

or

Should it strengthen its consumer goods business through backward and forward integration?

IS THERE A FUTURE FOR WIC??

Thank You