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Detergent Wars

In: Business and Management

Submitted By kathak
Words 2396
Pages 10
Detergent wars: Nirma, Wheel & Ghari

HLL entered India in 1957 and was the undisputed leader in detergent space. Surf was the most selling detergent in India. However in 1980's Surf suffered huge losses at the hands of a new and small firm, Nirma Chemicals. Nirma was launched in 1969 and its primary focus was to create a good, branded product at affordable prices. The product was priced far lower than the market leader - Surf. Nirma caught the attention of the middle-class and lower middle class customers and had such great sales that it evicted HUL's Surf from the No. 1 position in 1985. HLL then had a look at the situation and found that there was a large market segmentation in detergent space and then came up with lower priced Wheel (green) and Rin (blue) detergent powders targeted at different market segments. This segmentation helped HLL regain part of its lost market.

This post deals with price wars which are becoming an essential part of business. But a cut in price is the last resort in a price war. We will discuss more on various tactics to fight a price war. I will primarily focus on price wars in the detergent space, will also chip in with more examples as and when suitable.

Before i delve into more theories and strategies, lets have a look at some stats and series of events:

The detergent market in India can be divided into premium (Surf, Ariel), mid-price (Rin, Henko, Tide) and popular segments (Ghari, Wheel, Nirma, Mr. White). They account for 15%, 40% and 45% of the market share, which is 60% of the total market. Regional and small unorganized players still account for the 40% market. Per-capita consumption of detergent in India at 2.7 kg is the lowest in the world.

HLL entered India in 1957, Surf was the market leader for a long time.
Nirma Chemicals was started in 1969, in 1985 Nirma became the leading detergent in India.

In…...

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