Levelplast &

TexturaA Marketing Strategy

Presentation

By

Harshit Krishna

Group Intern

Introduction

2

A market expansion strategy for Birla White

Levelplast and Textura

Branded Plaster and Texture

Industry Analysis

3

Internal Competition

Few but large branded competitors, mostly not

focused on these product segments, high risk of advancement exists

despite product differentiation

Buyer Power

•Low Involvement product, products differentiations stay hidden

•Power concentrated with Channel Partners

•No switching costs, several options available for buyer

Threat of substitutes

•Local functionally satisfactory product dominance due to low prices

•Poor substitute quality but better channel engagement

•Prevailing trends major determinants of sales, unless entrenchment broken

Threat of new entrants

•Fragmented industry, low entry barriers

•Plaster a growing industry, Textures may be short-lived

•Once quality standards established and promoted, market share known to be stable in similar markets

Supplier Power

•Own raw material, little external dependence

Products’ Value Chain

Firm Infrastructure

•management focus, information flow

HR Management

•field personnel

Technology Development

•R&D, product improvements

Procurement

•captive raw material production

4

Inbound

•Purpose: demand creation for white cement

Operations

•Efficiency gains

Outbound Logistics

•Effective Availability and Transportation

Marketing and Sales

•Sellers, Influencers and Buyers, 4Ps

Services

•Complaint Redressal etc

Project Coverage

Firm Infrastructure

•management focus, information flow

HR Management

•field personnel

Technology Development

•R&D, product improvements

Procurement

•captive raw material production

5

Inbound

•Purpose: demand creation for white cement

Operations

•Efficiency gains

Outbound Logistics

•Effective Availability and Transportation

Marketing and Sales

•Sellers, Influencers and Buyers, 4Ps

Services

•Complaint Redressal etc

Market Relations and Information

Flow

Company

Seller

Influencer

Buyer

Company to Seller: awareness and

sales benefits (pull)

Company to Influencer: awareness and comparative

recognition (pull)

Company to Buyer: awareness

of quality (pull)

Seller to Influencer: product supply

(push)

Seller to Buyer: product

supply (push)

Influencer to Buyer: purchase decision (push)

Company

• Management

• Front end employee

Influencer

• Architects

• Applicators

Sellers

• Stockists

• Retailers

Buyer

• Builders

• IHBs

6

Agenda

7

Project Objectives

Levelplast Specific Issues

Textura Specific Issues

Common Issues

Time based Rolling Plan

8

Project Objectives

Levelplast Specific Issues

Textura Specific Issues

Common Issues

Time based Rolling Plan

Approach

Surveyed major and upcoming market areas

Studied products’ market and stakeholders’ for unique features and issues

Used qualitative and quantitative primary and secondary survey information to frame recommendations

Tested recommendations against insider views, analysis of available data and in a second round of market surveys

Formulated action points along a short timeline as per different strategic marketing variables

9

10

Studying cost and product based advantages and disadvantages of using

Levelplast and Textura vis-à-vis the leading products these seek

to substitute in terms of marketing, functionality and

market potential (PoP / Gypsum / Plaster of Paris and acrylic texture, respectively) to our

intermediate and end customers

Suggesting improvements in the two products’ features, their

pricing strategy, placement, product’s

positioning and promotion (consumer and channel

partners’ relationship with the company)

Studying the successful markets (Pune and

Bangalore, respectively) and analysing feasibility of

replicating / modifying them for Mumbai and other markets

Establishing most beneficial / correct application procedures

and the resultant standard optimum coverage and costs

numbers

Outlining ways to strengthen distribution in existing markets and understand feasibility of expansion into new market

areas

Long term aggressive and defensive volume and margin targets for the products and

action plan for next 2 years for Levelplast and Textura

Project Objectives

Levelplast Specific Issues

Textura Specific Issues

Common Issues

Time based Rolling Plan

11

Product basedKey Observations Poorly defined category, lies between

cement plaster and putty for strength andfinish, partially substitutes each

Few similar branded products incategory, main competition fromcheaper substitutes

Strength grading: No1 PoP > Gypsumplaster > No2 PoP > Lime Rendering.Gypsum cheaper, usage identical toLevelplast

Most important competitor varies area-wise, but better products used on ceilingsuniversally

Problem of non-standardmixing, application and quantities acrosssites

Adulteration of expensive with cheaperproducts rampant to save costs (e.g. PoP-putty 1:1 mix, local+branded mixing)

12

Action Points Guarantee product performance to

cover the value - price gap for LP, andchange product perception Supervised application: requires just

additional manpower, already scarce incompany, use product champion

Approved applicators: builder seeksreparations from company, but faultyapplication can’t be avoided by usdespite highest quality

Premium chargeable on actualguarantee, BW products alone haveability to be guaranteed in industry (adistinctive competitive advantage)

Market scope limited by local playerdominance to be addressed bycombining coarse putty (almost aflanking product to LP) and LP brandsunder common umbrella

Small LP SKU for repair and patchwork(1kg and 5kg), large for leveling in tradesales (20kg) and non-trade sales (30kg)

Although LP has several applications(leveler, plaster onRCC, patchwork, texture), focus onleveler-plaster usage

Product basedKey Observations PoP vs. LP

PoP weak against seepage unlike LP

LP setting time high (3 days) but nocuring / hacking required, PoP sets fastover cement (1 day) but requires watercuring / hacking

No2 PoP cheaper, sold loose, walllevelling, tiling usage and as base coat(except by very few aware builders andIHBs), No1 on ceilings and for repair work(correspond to the Coarse Putty andLevelplast duo)

LP applicable and cost effective asdirect plaster on RCC and block surfaces

Gypsum vs. LP Gypsum small competitor but fast

emerging in Pune and most othermarkets, long term supply limited

Compared to LP, very similarusage, poorer whiteness, similarfinish, much cheaper, easier to mix andapply, absorbs water, more durable thanPoP but worse level and finish

Lime / Sanla / Neeru finish vs. LP Gives smoother whiter finish than most

products, easy and quick application(directly on wet cement plaster)

Very easily available, direct sales frommanufacturer and wholesaler

Very poor strength and durability due tonature of application andcomposition, losing trend based marketfast

13

Action Points

Features to improve:

Trade off between pot life (2 hours) and

Setting time (>1 day), former needs to

increase, work in progress

Trade off between viscosity and

binding, increase binding to allow less

viscosity and easier application

Repulsive smell, work in progress

Packaging (minimizing wastage and

adulteration), Small SKU with handle

(appearance value, handling), work in

progress

Shelf life limited by standards for cement

industry at 6 months

Incompatible plasticizer and setting time

delayer compounds

Cement quality hampers easier mixing

(ease of application, painter point of

view)

Price based

14

Key Observations

Local PoP retailer margin (@SP of Rs160) =Rs15-20 (10-20%) difficult to match

Local material prices raised only as pernew taxes, raw material pricechanges, small variations ineffectual atsuch low price points, no brand premium

LP premium charged over competitors toohigh

Gypsum plaster nearest competitor (similarusage and thickness but is cheaper), costshalf

PoP weaker as plaster, competes as leveler+ base coat, similar costing whencombined with plaster but restrictedcompetition from LP (can apply as plasteronly on RCC, else is a leveler)

WCP - MF competitively priced in the samecategory (at lower thickness)

~30% taxes, ~20% transportation + depotexpenses. Bigger bags (handlingissue), more factories (area) notfeasible, storage space at a premium.Other expenses leave around 45% marginon an SP of Rs300 for 20kg, difficult toreduce cost unless at plant level. Volumegains not viable on price reduction for newunaccepted product as such

Action Points Contractor demands (reduce SP, credit

for contractors alone by grading), stockistdemands (reduce selling prices for highermargin, retain MRP for signaling) due tolack of customer-side awareness

Target value delivery throughpricing, market share through indirectcommensurate price benefits throughschemes etc. to match competitionprices and inform of the same in meetsand official communication channel

Revenue gains unlikely at S1 (describedlater) on price slashing, breakeven in S2with awareness of value and volume gain

Special landing price presently ~ Rs 300per bag, (trade price ~ Rs350) to bebrought down to Rs300 as a promotionalprice while re-launching, then increasedin small increments. Perceived aspremium product but worth the priceonce educated about

Gypsum per sq ft material cost Rs10, atLP’s coverage of 0.8 sq ft per kg toequalize per sq ft costs should reduce LPprice to Rs 8 per kg (or Rs160 per bag)

Adding quality premium (calculated next)above: Rs 143+160 = Rs303 per bag

Reimbursement schemes initially smalland frequent (monthly scheme: Rs7 perbag over 20 bags , Rs 8 over 40, 9 over80, disbursement quarterly, plus cashdiscount for stockists Rs1000 flat overeach 80 bags, longer schemes later

ParametersCement

Plaster

Gyproc

OC

Gyproc

OCELevelplast

Coarse

puttyPoP1 PoP2 Gypsum

SKU 50kg 25kg 25kg 20kg 20kg 20kg 20kg 20kg

Price (Rs) 300 215 230 350 450 180 100 150

Coverage (sq

ft per kg)2.33 0.75 1.15 0.8 3.5 0.7 0.75 0.8

Per sq ft cost

incl labour*14 24 20 32 12 20 11 18

Additional

coats

Leveler

and Putty

required

CP on

mortar

wall, putty

on mortar

and RCC

CP on

mortar

wall, putty

on mortar

and RCC

CP on

mortar

wall, 1

coat putty

on mortar

and RCC

CP on

mortar

wall, 1

coat putty

on mortar

and RCC

CP and

putty

(optional)

on mortar

and RCC

CP and

putty

(optional)

on mortar

and RCC

Applied

stand

alone

even on

mortar

wall

Preferred

usage

Walls and

Ceilings

(Plaster)

Walls

(Leveler)

Ceilings

(Leveler)

Ceilings

and

exposed

surfaces

(Plaster

and

Leveler)

Walls

(Plaster

and

Leveler)

Repair

Work

Walls

(Leveler

and Base

Coat)

Ceilings

and walls

(Plaster

and

Leveler)

Thickness 15mm 13mm 13mm 12mm 6mm 14mm 8mm 15mm

15

16

Value pricing for customer benefits and savings over a base price

per bag price for additional value

chargeable on a 1 lakh sq ft project

Differentiating featuresover

Gypsumover No1

PoPSource of value

Lifelong durability (high bonding) against 5-7 years durability 25 25 approximated from survey

Reduces 7 days from total wall preparing time, no curing but slow setting time of up to 1 day

22 22 time costs aproximated from survey

Is completely water resistant, no blistering, chipping, flaking of upper coats, retains all water

9 9time adjusted cost of painting from survey

No fungal / algal growth (spl polymers) 18 18cost of additional compounds for protection

Is as white as fine putty, saves primer cost as absorbs less paint 18 18 saving on primer costs

No hacking required 9 9 hacking costs direct saving

No sand required 0 9saving on cost of sand only against cement plaster + PoP

Can be applied till up to 12mm thickness over plaster 0 0 no differnece

Strong enough to be directly applied on block work till 20mm 0 36 cost of plastering for PoP

Birla brand 15 15 brand image and quality

Company transport on site (FOB destination) 0 0 ultimately included in billing

Needs special training for application given to contractors just like putty training along with certificate of Birla approval

15 15recognition value as per survey

Training to workers given free by company on site 10 10no value add, only recognition value as per survey

Comes in 30kg SKU for projects -5 -5 extra handling effort

Has slightly lesser smooth surface, coarse putty finish (needs single coat fine putty application for complete smoothness)

36 -18PoP1 used as base coat, Gypsum needs two coats base coat

Being cement based, is rough on hands and needs company provided gloves for worker

-9 -9initial unawareness linked issue, cost survey based

Needs electric stirrer for mixing, 2 hours pot life so prepared in small quantities repeatedly

-20 -20 cost of electricity, mixer and labour

Total premium chargeable 143 134

Placement based

17

Key Observations Seller

‘Local manufacturers’ dominate PoPand Gypsum (incl. our stockists, highermargins than in selling competingLP), triple up as contractors and sellers /samplers, provide own labor, creditterms, high retailer channel presence, selllarge quantities direct to builder

No retail scope until huge market positionobtained in projects (1. consumer costconsciousness, 2. specialised applicationrequirement - sales without correctapplication spoils product image)

Increasing gypsum usage; availabilityand costs most important, no brandpremium, many erstwhile PoPmanufacturers-stockists shifted

Need more entrenched market position ifnot shifting to Ultratech channels

Buyer Non-trade demand unpredictable and

sporadic

Base coat segment easier toapproach, so are IHBs. Branded levelercategory needs marketing push

Influencer Main influencers (contractor and

painters) opt for cheapest work to havelowest quotations

Service follow up and coordination weak(say, hand gloves not provided in time toapplicator), glitches haltapplication, hurt image

Action Points Bill directly to company approved

applicators for projects they land, billstockists for company landed LPcontracts, bill retailers 6 months afterlaunch

Sell Levelplast as part of a package(LP+Putty), initially cross subsidize LPthrough lower combined prices, earnfrom putty alone to increase LP sales andawareness, then from LP as prices raised

Bill stockists for sampling material whenrequired or keep him pre-billed for futuresampling needs

Best channel initially, company->stockist->customer (builder/applicator/IHB etc)because longer channel => higher totalmark-ups, again can’t afford higherprices

No strategy that increases prices furtherrecommended, if transportation expensespaid and then covered in billingprice, not recommended

Applicator important now as can controlall costs, labour, material of all kinds, inproviding several materials as packagecan reduce costs and increase sales of LP

Placement based

18

Placement strategy 1 (grey cementchannel) Sell through cement and plaster based

stockist and outlets simultaneously (likegypsum plaster is)

Objective: mass market expansion inlimited timeframe

Pros: Leverage 5000 strong Ultratech cement

dealer network to sell Levelplast

Plaster products bought before paintingstarts, makes sense to place it thus

Cons:

Sister concern UT gray cement has muchcheaper branded plaster already, sellingfrom same counter => cannibalization

LP applied on RCC (less on mortar walldue to costs at high undulations + mortarwall needs stronger cladding, LP=0.8MPa, CP=4M Pa), could lose these highpotential applications

Positioning as premium and high qualitywhite cement product diluted andinvolvement level further declines

Gray - White cementchannel, applicators, market informationlevels very divergent, difficult to sell suchan expensive product to plaster masons

Gypsum plaster sold thus is a non-durable, perceived-as-cheap and dullfinish (like gray cement) product

Not feasible if coarse putty to berebranded unless both are sold throughgrey channel

Placement strategy 2 (paintchannel, similar to Textura but moreinfluencer focussed) Objective: market entrenchment (sub

stockist model and product championmodel) and slow expansion

Strategy to include coarse puttyrebranding under Levelplast umbrella

Must still include powerful manufacturerstockists but focus on non-manufacturersfirst to create influencer acceptance

Initially, small SKUs (1 and 5kg) to be usedfor repair and patchwork for trade saleslarger sold through non-trade; universalizeslowly (12-18 months)

Pros: 70% White Cement based products end

sales through paint counters, awarenessimportant in hi-tech products, bestplaced in a customer friendly network

Don’t need too many stockists perse, demand limited, few can supply alarge area, need more entrenchment ingiven area to expand sales

Better visibility through existing stockistsand applicators

Can co-sell with fine putty and leveragere-branded coarse putty demand

Cons: Will take time to establish market

presence

Contingent on many otherrecommendations being successfullyimplemented

Promotion based

19

Key Observations Competing products of lower quality yet

no awareness created about same, Noeffective performance guarantee despiteclearly superior results so builders stay riskaverse of cost inefficient product

No applicator development / training(necessity for LP application) activitiesspecifically for LP. Too few applicatortraining centers and painter trainingactivities, no assistance to applicator intraining from company

Can’t push cost ineffective productwithout awareness of direct / indirect costadvantage, fully dependent oncontractors’ and stockists’connections, limited sampling drives

Too similar a positioning of coarse putty(WCP – matte finish). Excerpt fromwebsite:

“Getting a proper line and level surfaceBirla White Wallcare Putty Coarse (Matt Finish -MF) applied in thicker coats (5 - 15 mm)covers up the undulations on the plasteredsurface. It fills up the minor cracks/crevices inthe plastered wall and provides an evenlevelled surface”

Action Points More promotional focus on influencers

than owners/sellers unlike Textura Brand name, WCP’s high demand and

general BW quality industry standard, nopowerful competing brands, locallypopular names used by manufacturers topack loose material; leverage this initially Using existing BW sellers and

influencers to push products Universally using LP and Tex on BW

merchandise, stickers and signboardsfor counters even before launching inretail

Selling LP as a package through ourcontractors

Instead of competing on cost, positionuniquely from local products based onfeatures and aim to remove lower qualitymaterial from market

Promotion based

20

Re-branding Coarse Putty Best way to rebrand existing WCP-matte

finish (almost same positioning as LP atlower thickness and strength levels) asLevelplast coarse putty and existingproduct as Levelplast original

Benefits of re-branding coarse putty as a‘Levelplast coarse putty’ Higher coarse putty sales and awareness

positive for LP brand-name

Shall act as a flanker product for LP toeliminate local products

Will bring more focus on LP as a productin company management

Categories are betterdefined, cannibalisation resolved

Levelplast a quality leader, high futurepotential, requires push

LP Product benefits to highlight

Reduced paint consumption and primerrequirement

No curing so time saved

Applicable on wet plaster surface

No sand required that is wasted a lot inhandling alone, is coarse and facesmining ban

Great for time bound projects (public /govt’l constructions, big privateprojects, durability seeking infrastructureprojects)

Can inoculate against all cracktypes, include in positioning parallel to Tex

Chronological summary

21

Feature enhancement, as soon as possible -> Re-brand coarseputty under Levelplast umbrella before any new launch -> Pricereduction (direct: value pricing, indirect: dedicatedschemes, transportation, de facto guarantee) -> Productchampion appointed -> Sell through putty stockists, pre-billedstocks for sampling -> Target plaster and leveler markets ->Approach IHBs first, commercial markets later along withapplicators (push to sell package of LP+Putty) for sampling ->Stratified training and official communication channel -> Visiblemarketing (Levelplast samples and posters at point of sale, usealong with Birla White ads) -> Increase stockist entrenchment (sub-stockist model) -> Increase awareness and number of applicatorsthrough specific meets -> Relationship management practices forchannel members and applicators -> Part retailer and part stockistbilling -> Target patchwork and repairs market -> Shift to retailchannel

Positioning (Levelplast) P1 (current positioning: competition based, niche market product)

Platform targeted: Durability (Applicators, Specific Builders), Technically Advanced(Architect)

Levelplast as a premium leveler product, more durable substitute for cheaper localmaterial which form the basis for fine putty, can cover higher undulations thancoarse putty and PoP with better finish than Gypsum, suitable for only specializedapplication

Pros: Allows price premium based on quality leadership Positions us to acquire a niche market in plastering products Building awareness on tried and tested durability and quality lines

Cons: Pitches LP against far cheaper products, despite removing PoP substitute from

promotions reccently, company perception remains the same Low performance products also functionally sufficient in a low involvement influencer

dominant market Usage based positioning implies coarse putty also cannibalises sales Markets a new product like an old one (premium priced WCP) which faced a non-

existent product market and set all standards itself Aggravates low involvement nature due to advantages being shown through complex

industry jargon alone, could have worked if product was already at high awarenessstage

22

Positioning (Levelplast) P2 (suggested positioning: benefits based)

Platform targeted: Necessity (IHBs, Applicators, Builders)

Levelplast as a necessary cladding on walls and ceiling to permanently preventfungal / algal growth, cracks and water seepage related issues that no otherproducts can deliver without which your wall will eventually be damaged, versatileas a repair work product

Pros: Aims to remove local competition from the purchase decision equation Product as such can’t compete on price, should compete on what is its forte Necessity image to technically sound influencers and value pricing to other applicators

optimize sales potential of high quality product Makes product approachable to small applicators who drive most construction

volumes Niche marketing + low involvement nature => low sales, this positioning goes broader

Cons: Against the trend of premium priced product range Weight of cost effectiveness against benefits of a well promoted quality product may

be underestimated

23

24

Project Objectives

Levelplast Specific Issues

Textura Specific Issues

Common Issues

Time based Rolling Plan

Product basedKey Observations Coarse Putty substitutes RF (cheaper, easy

to apply, similar visibility at heights), 50 tpaJK coarse putty used as texture in BLR

Acrylic texture substitutes all variants(assumed to have better / smoother finishand hence appearance, an importantquality, pre-mixed, easy to apply)

Product category confused with interiordesigner paints, acrylic texture; cementbased texture not popular in general(impression that will crack like others do)

Perception of lack of designs (no RFpromotion)

Painter and contractor issues relative toacrylic texture (powder form, stirrer mixingnecessary for RF/SF, TF hand mixedbecause of granules, specialised training,gloves, electricity requirement, short potlife, repeated mixing)

RF potential demand high due to designs,slightly subdued due to cost, finishinferiority to acrylic, less visibility at height,lack of awareness and above factors

Higher adulteration in projects (highquantity, low monitoring)

Trend based industry (Cement paint->Emulsion->Texture->??)

Shelf life limited by standards for cementindustry (6 months), Incompatibleplasticizer and pot life increasingcompounds, Cement nature hampersease of application

25

Action Points Need repositioning for long term

demand, launch sooner in both channelsthan Levelplast

Larger granules => more visibility. Increaseto 3mm width from current2mm, introduce multiple sizes, 100-110 sqft per bag at 2mm, 10 sq ft coveragereduction per mm granule sizeincrease, cost per sq ft increase of only50p

Introduce larger economical SKU forprojects to avoid retailer perception ofbetter pricing for projects from stockists

Promote RF as versatile designerproduct, TF as standard texture, no needof flank products since competitivelypriced

Features to improve Trade off between pot life (2 hours) and

Setting time (>1 day), former needs toincrease, work in progress

Trade off between viscosity andbinding, increase binding to allow lessviscosity and easier application

Repulsive smell, work in progress

Packaging (minimizing wastage andadulteration, 5-8% material wasted, 20%loss to adulteration, 70% bags tamperedwith in Bangalore market), Small SKU withhandle (appearancevalue, handling), work in progress

SF, RF use coarse sand, non-binding dueto thinness of coat, thick coatexpensive, less popularity of sprayguns, rollers, non-homogenous patternsdue to quick drying

Price based

26

Key Observations Locals give up to Rs100 retailer margin on

Rs300 to Rs 520/bag of 25kg, we give 3-4%on over Rs640 selling price and Rs750MRP, save on transport, taxes and rawmaterial

Lower margins and awareness thanbranded acrylic too, also prone tosqueeze as retail customer ask for samelow price on non established producteven as company has hiked it over time

Fixed margins of 3.5% for stockist inpidilite, 5% retailer margin earned throughcross subsidising across product range inAsian Paints

Action Points Maintain prices for signaling effect as

targeted positioning of higherquality, transfer indirect pricing benefits aspromotional strategy

Reimbursement schemes initially smalland frequent (monthly scheme: Rs7 perbag over 5 bags , Rs 8 over 15, 9 over30, combined quarterlydisbursement, plus cash discount forstockists 5% flat

Longer schemes as performanceincreases later

27

Parameters Textura TF Textura RF Textura SF Branded Acrylic Local texture

SKU 25kg 25kg 25kg 25kg 25kg

Price (Rs) 650 700 700 900 500

Coverage (sq ft

per kg)4.4 5 5 2.5 3.1

Per sq ft cost incl

labour*10 11 11 22 8

Additional coatsPaint required,

No primer

Paint required,

No primer

Paint required,

No primer

Colours

available, Primer

required

Paint required,

Primer required

Preferred usageIHBs and

Residential

buildings

IHBs and

Commercial

buildings

IHBs and

Commercial

buildings

Commercial

buildings

Residential

buildings

Thickness 2mm 1.5mm 1.5mm 3mm 2mm

28

Key Observations Texture sales low generally, so retailer

keeps known big brands alone(Nitco, Dulux, Asian) in most areas

Market perception due to our longrestricted project focus: texture is best inacrylic form

Wherever texture in trend, local playershave entered market and capturedbased on price, additional services andavailability

Local acrylic mainly sells to small buildersand houses through painters and costconscious contractors, availability atstockists / retailers due to high marginsanother main advantage

Can’t be used over once-paintedsurface, no replacement market

Texture done towards end ofconstruction, small owners cash strappedby then, go for cheapest option available

We sell to all sizes and income ranges (asper awareness), branded acrylic texturebought by big builder projects andarchitect influenced ones who go onbrand appeal

Small applicators and retailers highestvolume drivers, least considered

Action Points Sales channel: paint counters and existing

putty stockists, presumed point of sale forsuch products

Improve retail and small applicator focus(volume drivers), WCP launched in retail6-12 months after project launch, ensureequal prices as projects from stockists,currently Rs5-20 differential

Towards end of S1, sell to contractorthrough retailer in company-landedprojects under 25 bags and throughstockist for over 25 bags

Directly bill large contractors after certainquota of earlier applications reached (S2)

Rs 10 per 25kg bag transportation fromdepot on average, could include in billingprice for Textura (S1), per sq ft rise = 10p

Placement based

29

Benefits of retail focus

Stockist, retailer, applicator, painter,end customer all involved

Better word of mouth awareness,complaint redress done by channel

Retail sales = higher profit for allchannel partners (due to higher retailprices and more marginopportunities), high and stableturnover for company (80% WCPsales through retail), more visibilityand awareness

Paint-like product needs highercustomer involvement level to sell

Benefits of billing through retailers

Company: Sales up, retailerawareness and acceptance,

payment collection outsourced

Retailer: Turnover up, more schemeearnings, additional sales of paintertools and related products to buyingcontractor, business automaticallygenerated w/o stockist competition,good for attracting retailers on board

Contractor: Can avail of smallquantities too (company normallydirect bills for 100 bags or more)

Placement based

Promotion based

30

Key Observations

Less market focus on category by majorbrands, hence fragmented and limited

market, mostly in projects in our case

Similar problems with product look andfeel (needs painting over, low visibility atheight issue) as in acrylic, latter only morecirculated and and hence sells due toawareness

Textura sales in general not pushed acrossthe company because of WCP focus

Action Points Product be visibly placed at selected

putty retailers / stockists on 4’*2’ sampleson walls, stickers and signboardscontaining Textura pictures

4 sheet catalogues to influencers freewith 4 designs per sheet topersonnel, applicators, retailers, architects, builders

Branded acrylic and RF potentialdemand high due to numerous designsand uniqueness, first mover advantagewould count

Benefits to be highlighted: Higher coverage, so more cost effective

despite high MRP

Single uniform granule size unlike others

Acrylic finish smoother than TF but nondurable

No peeling unlike acrylic = suitable forrainy / seepage prone areas

Primer costs saved

Chronological summary

Feature enhancement, as soon as possible, esp new SKU forprojects and granule size -> Price reduction (indirect only:dedicated schemes, transportation, actual billing pricesmaintained) -> Product champion appointed -> Sellthrough putty stockists, pre-billed stocks maintained forsampling -> Approach IHBs first, commercial markets lateralong with applicators for sampling -> Stratified trainingprocesses and official communication channel in place ->Visible marketing (Textura samples and posters at point ofsale, catalogs with channel partners and salespeople) ->Increase stockist entrenchment (sub-stockist model) ->Increase awareness and number of applicators throughmeets -> Relationship management practices for channelmembers and applicators, grading -> Part retailer and partstockist billing -> Shift to retail channel

31

Positioning (Textura) P1 (current positioning, ‘usage based’) Positioned as an appealing and artistic

product,

Platform targeted: Premium (niche IHB, Builder), Designer appeal

(architect, IHB, builder)

Textura as a cement based higher-quality-than-competition premium exterior walltexture, meant to cover bad workmanship and undulations permanently, focused onprojects, competing against all similar products (acrylic texture, putty used as texture).

Pros:

Project focus builds market credibility for new product

Builds applicator knowledge and establishes a sales channel

‘Usage’ positioning targeted at prime influencers, the applicators

Conforms to company perception of durability and visual appeal not congruous for textures

Cons:

Quality difficult to show without widespread promotion, sampling

Restricted by nature of product and costs involved, respectively

Appeal more important than durability in wall coats, thus focusing on latter at former’s

expense works to product’s detriment

Competitors have unique benefits that we lack (designs, finish, price)

Direct competition from functional cheaper coarse putty and local products in cost

sensitive projects market

No focus placed on either sellers and buyers, or on architects

Ads displaying designs and appeal as product platform not in tune with market perception

of cement based better binding and protecting counterpart to acrylic texture, failed

positioning, probably improperly conveyed or being sold on benefits which themselves

became positioning

Still lower involvement than deco paints, if position as luxurious like acrylic is, the latter which

is better promoted will sell

32

Positioning (Textura) P2 (suggested posiitioning: benefits based new concept)

Platform targeted: Strength(Builder, IHB, Architect), Approachable (applicator,builder, IHB) Textura as a new kind of texture that not only gives finish and numerous designs of

acrylic texture, but the better binding and durability of cement products thus is a wallprotecting, permanent exterior coat with many designs (when RF and TF takentogether), quickly applied, covers structural cracks at any type of construction andstands seepage and rains

Pros: Sells not the product but the specific benefits people look for

No premium portrayal so as not to compete with branded acrylic

High quality as differentiator from cheaper substitutes

End users also taken in loop along with influencers and sellers

Portrays all benefits only we can provide

Appeal and Strength combination USP

Cons: Applicable as far as company interfaces quality conscious customer

33

34

Project Objectives

Levelplast Specific Issues

Textura Specific Issues

Common Issues

Time based Rolling Plan

Product basedKey Observations

High-end and differentiated featuressought in a new product to compete

unless aided by promotion and pricing

Area (weather and sandetc), psychology (existingtrend, channel familiarity andapplicator specialisation), and thusawareness prime determinant

35

Action Points Single layer better material packaging to

avoid wastage and adulteration ofexpensive material

Guarantee performance as a lifelongproduct in word and indirectly, the ‘partof wall’ statement limited time periodguarantee by paint cos

Price based

36

Key Observations Non-uniform prices across stockists and

cities, big stockists hoard high volumesand sell at lesser prices, + multiple stockistsin an area => competition andundercutting

Seller squeeze margins to sell popularbranded products, if no volumes thenhigh seller margins sought to pushproduct, credit also given by others (localand branded manufacturers) and thusrequested by channel partners ( incl.seller category)

All products in profile sold at premiumover competition (quality leadershippricing)

Special prices to non-trade partiesarbitrarily decided on a cost + bargainedpremium basis, no uniform prices from usand from stockists, too much discretion

3 day advance paymentrequirement, work slowed if large orderplaced w/o immediate cash availabilitywith applicators

Company perception: credit to stockist =more credit to retailers, bad debtsaccumulate (company impression ofinsurmountable bad debts), companyimage suffers and product abandonedby contractors

Action Points Area sales teams’ pricing discretion

to be limited to offering (or not)discounts and schemes as perdefined criteria and objectives, withan additional 5% leeway only

Target quality based value deliverythrough pricing, gain market sharethrough product positioning andawareness

Special price determination curve fordirect billing above minimumrealisation requirement (orderquantity, previous cumulativepurchases, initial promotional pricing)as in excel sheet

Placement based

37

Key Observations

Seller

Retailer sells the bestseller for volumes,

push products with highest margin, new

products have neither. If margins given

but volumes absent, will push the better

selling products

Channel penetration and perception

prime sales determinants for branded

products (eg.Lime prominence), high

dependence on paint retailers (cement

products’ share of their turnover ~2%,

can counter by deeper market

penetration)

Retail hold possible by better benefits

than competitors to sellers (for seller

push), and applicators (influencer push)

until customer awareness based

demand created (sampling, applicator

development, promotion), but current

project focus means sticking to

influencers alone

Retailer competition with stockist selling

to contractors, customers directly at

lower prices that retailer can’t afford or

consuming themselves

Perception of low gains from small SKUs

across products + inexact demand

forecasts => supply issues for these

potential volume generators

Action Points Seller

As less as one bag sold by stockist on cash,highest retail quantity on one sale not much,because buyer lifts only as per immediaterequirement. Impossible to demarcate salesquantities, can only support retailers throughdirect billing

Fixed area wise stockists=> no infringements =no undercutting = uniform pricing. Divideareas for stockists and inform retailers andstockists of the same through meets and anofficial communication channel betweencompany and channel

Sans-stockist Asian model of sales works onmarket recognition, stockist push not required,critical in our case

Increase stockist penetration through substockist model, better ROIs

Cash discount (special prices) 5% +Trade discount (as per quantity) 5%

Stockist keeps at least Rs 10 per bag inTextura as margin, retailers keep Rs 10-15too

ApproxRs 10 per bag incurred intransport by stockist from depot to owngodown, little stocked, ordered fromdepot when required, small quantityretailers supplied from own stocks andcharged inclusive of transportation

Directly give targets to and compensatestockists’ sales team to countercompany understaffing

UBSs uninvolved so far with LP / Tex, shouldhave leveraged them to promote in andaccess Tier 2 / 3 cities wherever productlaunched

Retailer should not have to compete withstockist on price for same customer, bill onlythrough retailer for smaller quantity orders

Placement based

38

Key Observations

Influencer

Repeat applicators, few new ones

because of inadequate training and

information activities

Small quantities required for sampling,

necessary to promote, since sales low

and low shelf life, stocks rarely

maintained if launches unsuccessful

Difficult to cross sample at project site,

especially when product pre decided

Takes up to 2 months to convert a lead

from first approach to sampling to usage

for new products, 15-20 days for Putty

Issue of timely delivery for new products

(low sales turnover) in projects because

sufficient total quantity required to place

order, hits reputation and contractor

orders elsewhere; not so for products in

retail where stockist supplies

Architects small influencers because,

much like builders, are involved with

design (look-feel) of construction and not

what’s applied inside. Relatively more

important for Textura than LP because is

a visible product

Action Points Influencer

Whether to directly bill applicatordecided as per their bargaining power(size of order, market reputation, previousorders), should provide streamlinedspecial pricing

Billing contractors through retailers forown projects and supplying from depotunder 100 bags (in S2, beginning ofretailer focus along withsampling), supply from depot

Billing contractors through stockists forown projects and supplying from depotover 100 bags

Currently company samples to onlybuilders through applicators, sells to thembut if sampling slow (as is the case), novisibility whatsoever, need more samplingfor IHBs, slightly easier market

Placement based

39

Key Observations

Buyer

Perception is - once all others engaged

IHBs-builders demand will come by

awareness. Least connected parties as

of now

Builders stock just enough

quantity, repeated on-time delivery

hampered by 3rd party transporter

involvement. Company transports

effectively only from factory to depot

Small customers / house owners can

spend a little extra per sq ft totaling to a

few thousands at most (for 500-2000 sq

ft), Big projects mean additional expense

in lakhs, quality concerns lower

Action Points Buyer

Cross selling / sampling throughapplicators of putty for LP on site ,invitation for free sampling in ads Approx 33% sampling conversion in

projects for Textura, 75% for WCP, <10%for LP, this needs continuous monitoring,IHB conversion higher

When products to be used alreadydecided, as in big commercial projectsinvolving architects etc, cost per sq ftmost important to change preference soapproach beforehand througharchitects and applicators

1 bag LP used giving around 14 sqft onwall (multiple coats) and up to 28 sqft onceilings, 3-4 designssone in Textura,maximum consumption upto 2kg

For company, labour cost Rs 350-400 persampling; hire monthly paid paintertrained for WCP / Textura / LP to sample,cost Rs8000/month

Placement based

40

Company

Improve information flow by advertising and effective new manpower use, material flowwill follow sales, invoicing flow and payment flow channels need product dedicated

manpower

Virtuous cycle: Stocks->Point of Sale Availability->Sales->Awareness->Demand->Stocks.Need to improve logistics and awareness creation to maintain usable stocks and marketinterest

Need to establish continuous flow, small pre-billed stocks maintained with dealers forsampling purposes while project team scouts for new sites [how much exactly]

Redefine CASC objectives as long term demand generation CASC objective to generatelong term pull side demand for products, engaged in sales and promotion wherevermanpower shortage in big areas such that same person handles both activities (Orissa),

need to overcome understaffing to gain focus

Promotion based

41

Key Observations Communication and Training

Owners (quality conscious) uneducatedof quality parameters, product presenceand advantages; influencers even ifeducated, unicentivised in absence offramework for dealing with channelpartners separately

No separate coverage ofarchitects, (more important influencersthan applicators in bigger projects, richIHBs)

Communication on, number of andengagement level of schemes andmeets to retailers weak compared topaint cos, retailers randomly called andnot informed about in time, sporadiccoverage

No direct communication frommanagement or RnD to big clients(recognition and involvement) as exists inother cos (share performance stats, salesstrategy, channel information, targetsegments etc in fewer larger stockists /applicator programmes)

No mass media used because productuse requires special training, can’t selland risk bad application unlessapplicators developed and generalmarket awareness there

Online efforts (information throughwebsite, cost calculator, design pictures)unreliable because of low involvementnature of product

Painter meet training ineffective relativeto formalised training programme, nolocalised training programme (AsianPaints’ Royale Play training)

Action Points Communication and Training

Educate employees first, then influencersand retailers through stockists, thenindirectly approach end customers toevoke quality consciousness

Only WOM advertising so far, need masspromotions once quality parametersestablished in market (S2), advertiselocally on TV - radio in S2, co-advertisenew products with other Birla Whiteproducts first

Develop applicators in umbrella modelocally, 1 authorised trainee teaches 4, 4teach 16, examine new painters’work, pay Rs 200 per head to authorisedtrainee. Total FY11-12 formal trainingexpenditure Rs17.5 lakh, per head costRs3000-4000 (2 painters attend with eachcontractor teach others if interested inproduct). Rs50-100 per head cost of on-site training including small gifts

On-site training and supervisedapplication as de factoguarantee, can’t do through actualguarantees or approved applicators asfaulty application can’t be avoided byus despite quality

If well engaged throughmeets, architects could recommendusage as a standard product given hightop of mind recall, important party inbuilding designing and qualityrecommendation

Promotion based

42

Key Observations

Channel

Stockist priority => sales (given awareness

and promotion) > service levels > margins

> schemes (Big, stockists / applicators =>

recognition more than margin hikes)

Retailer priotity => sales > margins >

schemes > service levels

Applicator priority => sales > service

levels > pricing

Quality pre-requisite not sales driver

Sellers don’t push and stock also

because awareness and sales need

to go up hand in hand

Importance of quality: IHBs >

Architects > Applicators > Sellers > 3rd

party builders, benefits besides

awareness sought for new

competitive product

Our applicators too can’t push in big

projects where builder-architect

have pre-decided preference

Schemes not tied to

quantity, inadequate compensation

especially considering products are new

Stockists change very frequently, timely

availability and procurement issues exist

Action Points Channel

Effective influencing power in productselection: 60% applicator, 20%architect, 10% builder, 10% seller(currently stockist only), need toempower sellers with time

Credit sales to grade A contractorsalone, not stockists (forwards more creditahead, collection issues, lossesaccumulate in channel, incrementalprice chargeable by giving credit = up to2% of credit amount

Timely payment incentivising credit forcontractor / stockist: 3.5% annualincentives for all payments made withinthe week, 5% for all made in advanceabove minimum 50 bags a month over 2quarters, more lax policy not feasible atour turnover level; total outlay = 11% ofmarkup

Special prices=>undercutting inchannel=>limited growth andunprofitability, avoid in Textura atleast, give to applicators on directbilling, not to sellers

Local level counter-wise and applicator-wise training to their painter contacts tocapture counters, develop contractorsand painters + recognition tochannel, cost estimate Rs100 per head(Royale Play training costs), regularpurchasing painters from retailerscommand 30-50% share of sales, noportrayal of very high specialization, allmeets to be area-wise

Could seek invitation for free sampling atconstruction sites while locally advertising

Promotion based

43

Key Observations Organisation

Management focus, targets, retailerschemes and initiatives, special rewardsfor stockists and applicators, employeeappraisals components (40% each WCand WCP sales, 10% each LP and Tex)tied to WC and WCP sales, otherproducts thus ignored

Old product based targets passeddown, thus limited new productinformation at each level + no in-housetraining facility (5 zonal level meetingsheld periodically to exchangeinformation, then passed on, no directinvolvement of front end line employees)=> disconnect between field action andplanned objectives

Little incentivizing, promotionopportunities, raises, travelallowances, refunds for phone and foodetc, liable to leave company (averageperiod of employment in the companyof an SR <2 years, perception pf unstableemployment). Pay 10k + ~600p.m.incentives, less than competition, JK pays15k fixed + TA/DA, Asian 16k fixed, Pidilite17-18k fixed, (all market majors, onecement company)

No management focus leads to lack ofcoordination between sampling, followup, pricing and supply, in turnsuppressing sales and awareness further

CASC objectives (long term demandgeneration) and functions (salesactivities) misaligned

Action Points

Organisation

Train employees regularly on productand marketing innovations from differentareas, involve marketing – sales –projects employees in employee meetby seeking opinions and rewarding same

Separate teams: experienced SRpromoted to on-roll field officer asproduct champion, separate team inS2, Base targets and appraisal on newproducts, initially as a small share oftotal, then standalone targets andappraisal heads for dedicated staff

Market knowledge required differentfrom putty application and market

Cost: on roll employee placed atincrement of 6000 + incentives to matchindustry as product champ, Benefit:incentivising all others and cheapest wayto push products, better channel hold

Responsibility: salesleads, sampling, providing costestimates, product info and applicatorlink-up to customer, follow-up, documentations, pricing, meetauditing, sales monitoring, supervisedapplication, architectcoverage, complaint redressal, morechannel visits

Communication, transport paid for andautonomy to act such that complaintredressals and request fulfillment donewithout delays of escalation

Revisit incentive structure of off roleemployees, performance basedincentives to the extent of billreimbursements and on-roll trainedemployees’ field activeness needed

Promotion basedSub Stockist model In addition to existing distribution model Initially a stockist of some other products willing to deal in Birla White products

Buys from regular stockist not selling to C-class retailers C-class retailers’ potential average sales of around 10 bags Gets stockists’ best price for retailers being a big buyer Sells at smaller than stockists’ margin Retailers also get comparatively lesser margin than bigger retailers Similar to having multiple stockists in same area in that margins reduced but reach

achieved, no conflict as targets different Schemes from company same as those given to retailers for the smaller retailers shown

under the actual stockist No schemes currently for the sub stockist who also gives credit and transport to cash

strapped small retailers If given credit etc and supported by company, then best way to crack new and old but

slow markets (un-captured sections) to drive volumes After regularly making certain amount of sales, upgrade to stockist level for a new area If product not working need better penetration rather than market expansion

44

Promotion based Relationship management practices (more important for bigger clients)

In new markets initially for new products, all initiatives as per parties’ total turnover andnot BW sales

Have 3 grades of contractors based on annual Birla White sales (Grade A >Rs20,00,000, Grade C < Rs4,00,000), felicitate same and give direct billing, credit selling(advance cash payment -> cheque payment -> credit, then increase creditlimits), product dossiers with birthday, anniversary cards, privelege cards with points tiedto sales reimbursable or usable in AB Group outlets

Rs 1.5 - 2 lakhs already spent on a retailer meet, segregate channel partners byturnover, organize separate socialising programmes (trips, tours) for big ones for betterexchange of information, expectations

Engage the family (gold coins as investment, tour packages for family etc traditionallygiven, appliances)

Lucky draw at meets with compulsory counter owner presence to collect awards

Seniority wise liasoning under an official communication channel: management to Agrade stokist / aplicators, builders and architects, field officers with other stockists andapplicators, off-roll field employees with retailers and end customers

45

CASC activities Lucky Draw Trips / Tours Liason programme* Fecilitation

Retailer meet 10000 1-3.5k per head 10000 800 per meet

Contractor meet

10000 1-3.5k per head 4500 800 per meet

Engineer/architect meet

28000 1-3.5k per head 3000 800 per meet

Painter / mason meet

NA NA NA NA

*per month in an area on an average based on Asian Paints data

CASC activities Rs3.08 crore CASC budget this year, ~80 lakh expenditure in meets last year (31% of

total Rs2.56 crore), need to push up to 40% (or 1.232 crore) while including separatemeets for new products

Formal training expenditure last year 17.5 lakh (~7%), need to push up to ~10% (31lakhs) as counter-wise and applicator-wise painter training introduced

Sampling costs at 5% and Relationship Management for applicators, builders, andarchitects at a total of 5%% of budget as separate categories

Need to withdraw additional requirement in above two from CASC budget spent onsales activities, need to restrict sales expenditure to sales budget

Promotion based

CASC activitiesCost per head + (cost of gifts)

Avg no of attendees

Frequency (national level, per annum)

Retailer meet300 + (200 to

300)50-80 50

Contractor meet

300 + (200 to 300)

50 100

Engineer/architect meet

600 + (400) 50 30

Painter / mason meet

200 + (120) 50 200

46

Other promotional activities

Costs

Ads in local newspaper614 per sq cm of coloured

ad space, 440 for B/W*

Ads in local TV channel14000-21000 per 10s slot (off-time, prime time)#

Ads on radio

AIR 250-400 to 400-1000 per 10s as per city tier, pvt FM 1600-2700 as per city

and time of day

Sampling (free, by invitation)

65x for Tex, 350x for LP + 9000 a month labour /

350x^

Token 25x for LP, 45x for Tex

*dainik jagran rates, #ETV rates, ^'x' implies no of samplings

Promotion based Presentation at meets

Standard presentation used at all meets Need audience wise changes in technical-marketing orientation; engineers, applicators,

painters, stockists, retailers Include more on product positioning and specific audience benefits (what’s in us for you?

features, company provided benefits, problem resolutions) rather than product features (toomuch focus on tech details currently)

Importance of standard application to be outlined along with numbers Division of presentation into parts is suggested as follows:

47

Components seller applicator architect engineer painter

Company Info, Strategic

Vision, Party’s Importance

15% 15% 15% 15% 15%

Product Positioning And Usage Areas

25% 25% 25% 20% 25%

Technical Specifications 10% 10% 25% 30% 10%

Benefits And Features, Why Costly?

25% 25% 25% 25% 25%

Promotional Benefits For Party Concerned

15% 15% 0% 0% 15%

Other Products 10% 10% 10% 10% 10%

48

Project Objectives

Levelplast Specific Issues

Textura Specific Issues

Other Common Issues

Time based Rolling Plan

Temporal Stages in market expansion in an area* for Textura

Can’t use same metrics as WCP (under 1000tpm underdeveloped, above 2500tpm

developed) for LP/Tex, must gauge total addressable market in area as per

substitute products’ usage and demarcate proportions. Under 2%

underdeveloped, over 15% developed for Textura

Begin from S1, Underdeveloped:

influencers most important, so applicator development important

selling through stockist to big and small projects and contractors

include new products in targets/appraisals of putty team (product champion)

Grow to S2, Emerging (transition requires applicator development and sampling

drives to create general awareness):

newly created influencers push the product

stockists sell to projects and some big retailers only, sub-stockists created

billing the retailer for small orders and retail promotional activities

applicator development continued and upscaled

handover responsibility of new products to a separate team

Finally arrive at S3, Mature (transition requires high pan-market

awareness, relationship mgmt and good service levels):

take all on board (seller, influencer, buyer)

selling mainly through retailers

billing retailers and few ‘privileged’ contractors for all company projects

S1 toS3 should be at least 6 months, ideally 12-14 months

Mumbai stuck in S1, Bangalore moving onwards from S2

*all markets in S1 initially with at best partial exceptions wherever taxtures already

popular

49

Creating an area wise strategy

(Textura) Alter these stages as per ‘Market Types

Launched earlier, unsuccessful, eg. Mumbai area (study for losses, rectify erroneous

practices as the case may be, re-launch)

Launched earlier, successful (moderately) due to contingencies, eg. Bangalore

area (share contingencies in employee meet, verify applicability elsewhere, devise

alterative placement strategies)

Launched recently, good response, eg. Hyderabad area (highest focus, implement

recommendations and monitor results)

Launched recently, slow response, eg. North Zone (check which implementations

faulty, correct for and continue)

Not yet launched, but other textures present, eg. Most areas in Rajasthan India

(look for dominant product's main qualities, modify promotion strategy, develop

applicators)

Not yet launched and other textures absent, eg. Eastern India areas [most lucrative

market], eg. Rest of India

In each market, check for:

ongoing trends in exterior wall coats (nature of products, application methods,

price consciousness)

locally common construction issues (coarse sand, labour, primary complain)

trends in relationship between sellers, influencers and buyers (strong influencers a

plus point)

staffing requirement and further area divisions based on market size

entrenchment of wallcare putty in market, channel hold

50

Creating an area wise strategy

(Textura) And enhance or maintain sales effort as per ‘Building Types’

Commercial projects (second largest application, architects dominant)

Residential projects (largest application, architects involved)

Government buildings (time constraint important, tenders important, potential

customer in good to high awareness market)

Independent houses (easiest to cross sample, painter and contractor

dominated, volume drivers)

51

Ranks -> 1 2 3 4

Amount of applicationResidential

Projects

Commercial

projects

Government

buildings

Independent

Houses

Extent of cost consciousnessResidential

Projects

Commercial

projects

Government

buildings

Independent

Houses

Readiness for samplingIndependent

Houses

Independent

Houses

Commercial

projects

Government

buildings

Potential market sizeResidential

Projects

Independent

Houses

Commercial

projects

Government

buildings

Rank Trade channel Non trade channel

1 Existing trends in market Existing trends in market

2 Durability and Binding Cost per square feet

3 Strength against cracks Visibility

4 Water resistance Finish

5 Cost per square feet Durability and Binding

6 Visibility Strength against cracks

7 Time required for application Water resistance

8 Ease of Application Time required for application

9 Handling Ease of Application

10 Granule size Handling

11 Availability of required quantities Granule size

12 Finish Availability of trained applicators

13 Availability of trained applicators Availability of required quantities

14 Timely and easy availability Timely and easy availability

15 No of designs No of designs

52

As per importance of following parameters:

Temporal Stages in market expansion in an area* for LP

Can’t use same metrics as WCP (>1000tpm underdeveloped, above 2500tpm

developed) for LP/Tex, must gauge total addressable market in area as per

substitute products’ usage or from putty market and demarcate proportions. Under

0.5% underdeveloped, over 7-8% developed for LP

Begin from S1, Underdeveloped:

influencers most important, so applicator development important

selling through stockist to big and small projects and contractors

include new products in targets/appraisals of putty team (product champion)

Grow to S2, Emerging (transition requires applicator development and sampling

drives to create general awareness):

newly created influencers push the product

stockists sell to projects and some big retailers only

billing the retailer for small orders and retail promotional activities

applicator development continued and upscaled

handover responsibility of new products to a separate team

Finally arrive at S3, Mature (transition requires high pan-market awareness,

relationship mgmt and good service levels):

take all on board (seller, influencer, buyer)

selling mainly through retailers

billing retailers and few ‘privileged’ contractors for all company projects

S1 to S3 should be at least 12 months, ideally 16-18 months

Mumbai stuck in S1, Pune in S2

*all else in S1 initially with at best partial exceptions

53

Creating an area wise strategy

(Levelplast) Alter these stages as per ‘Market Types’

Launched earlier, unsuccessful, eg. Mumbai (study for losses, re-visit after fewsuccessful launches)

Launched earlier, successful (moderately) due to contingencies, eg. CentralZone (share contingencies in employee meet, verify applicability elsewhere,devise alterative placement strategies)

Launched recently, good response, eg, areas in North India (highest focus,implement recommendations and monitor results)

Launched recently, slow response, eg. Ahmedabad area (check whichimplementations faulty)

Not yet launched, eg. Most of India (study addressable market size fromputty sales and application trends of substitutes)

In each market, check for ongoing trends in exterior wall coats / plastering (nature of products,

application methods, price consciousness)

locally common construction issues (coarse sand, expensive labour, primarycomplain types)

trends in relationship between sellers, influencers and buyers (stronginfluencers a plus for

staffing requirement for new products and further area divisions based onmarket size

entrenchment of wallcare putty in market, channel hold

54

Creating an area wise strategy

(Levelplast) And enhance or maintain sales effort as per ‘Building Types’

Commercial projects (largest application, architects dominant)

Residential projects (second largest application, architects involved but

applicator has say)

Government buildings (time constraint important, tenders important, high

potential customer in good to high awareness market)

Independent houses (easiest to cross sample, painter and contractor

dominated, volume drivers)

55

Ranks-> 1 2 3 4

Amount of applicationCommercial

projects

Residential

projects

Government

buildingsIHBs

Extent of cost

consciousness

Residential

Projects

Government

buildings

Commercial

projectsIHBs

Readiness for samplingIndependent

Houses

Residential

projects

Commercial

projects

Government

buildings

Potential market sizeCommercial

projectsIHBs

Residential

projects

Government

buildings

Sales Determinants

Rank Trade channel Non trade channel

1 Water resistance Water resistance

2 Cost per square feet Cost per square feet

3 Thickness Thickness

4 Durability and Binding Durability and Binding

5 Strength against cracks Strength against cracks

6 Whiteness Whiteness

7 Availability of trained applicators Availability of trained applicators

8 Finish Finish

9 Existing trends in market Availability of required quantities

10 Availability of required quantities Existing trends in market

11 Timely and easy availability Timely and easy availability

12 Ease of Application Ease of Application

13 Handling Time spent in application

14 Time spent in application Handling

56

As per importance of these parameters

Volume TargetsLevelplast

Addressable market size estimate for Levelplast in:

FY 2013 (launched in 10% putty markets)

317, 303 tons

FY 2014 (launched in 15% putty markets)

539,125 tons

Current cumulative market share in launched markets 0.4%

Targeted cumulative market share in:

FY 2013 0.8%

FY 2014 1.5%

Volume target for Levelplast in:

FY 2013 2538.4 tons

FY 2014 8086 tons

57

Textura

Addressable market size estimate for textures in:

FY 2013 (launched in 10% putty markets)

94,124 tons

FY 2014 147,623 tons (launched in 15%

putty markets)

Current cumulative market share of Textura in launched markets 1.6%

Targeted cumulative market share in:

FY 2013 3%

FY 2014 5%

Volume target for Textura in:

FY 2013 2824 ton

FY 2014 7381 tons

Thank You For Your Time

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