The Nirma Story


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Case Details:

Case Code : MKTG008
Case Length : 8 Pages
Period : 1985 -2001
Pub Date : 2001
Teaching Note : Available
Organization : Nirma, HLL
Industry : FMCG
Countries : India

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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Excerpts

A Humble Beginning

In 1969, Karsanbhai Patel (Patel), a chemist at the Gujarat Government's Department of Mining and Geology manufactured phosphate free Synthetic Detergent Powder, and started selling it locally. The new yellow powder was priced at Rs. 3.50 per kg, at a time when HLL's Surf was priced at Rs 15. Soon, there was a huge demand for Nirma in Kishnapur (Gujarat), Patel's hometown...

The Road To Success

The use of detergent powder was pioneered in India by HLL's Surf in 1959. But by the 1970s, Nirma dominated the detergent powder market, simply by making the product available at an affordable price...

Higher Costs - NO

Within a short span, Nirma had completely rewritten the rules of the game, by offering good quality products at an unbeatably low price. Nirma's success was attributed to its focus on cost effectiveness...

Brand Wars - YES

Nirma also had innovative marketing strategies. In the mid-nineties, Nirma successfully extended its brand to other product categories like premium detergents (Nirma Super Washing Powder and Detergent Cake), premium toilet soaps (Nirma Premium, Nima Sandal, Nirma Lime Fresh)...

The Road Ahead

Though Nirma was better known as a producer of low-cost economy range of products, it was successful in the middle- and up-market segments.

But at the same time, competition was also increasing. While HLL continued to be a major competition, P&G and Henkel SPIC also adopted aggressive measures.

Players from unorganized sector were also adding to the competition in the detergents and washing powder industry...

Exhibits

Exhibit I

 

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