CUSTOMER RELATIONSHIP MANAGEMENT AND THE P&G GILLETE OFFERING

CUSTOMER RELATIONSHIP MANAGEMENT AND THE P&G GILLETE OFFERING

ACKNOWLEDGEMENT

I express my sincere gratitude to my faculty guide Mrs.XYZ,lecturer, XYZ University, for his/her able guidance, continuous support and cooperation throughout my project, without which the present work would not have been possible.

I would also like to thank the entire team of P AND G STAFF, for the constant support and help in the successful completion of my project.

2

CONTENT

S.NO.

TOPIC

PAGE NO.

1.

ACKNOWLEDGEMENT..................................................................................1

2.

EXECUTIVE SUMMARY................................................................................3

3.

INTRODUCTION..............................................................................................5

4.

INDUSTRY INTRODUCTION.......................................................................41

5.

OVERVIEW OF FMCG SECTOR IN INDIA..............................42

6.

COMPANY PROFILE.....................................................................................46

7.

RESEARCH METHODOLOGY & OBJECTIVE ..........................................69

8.

FINDING & ANALYSIS.................................................................................74

9.

CONCLUSION................................................................................................82

10.

RECOMMENDATION....................................................................................84

11.

FUTURE PROSPECTS...................................................................................85

12.

BIBLIOGRAPHY............................................................................................86

13.

QUESTIONNAIRE..........................................................................................87

3

EXECUTIVE SUMMARY

Before we begin to examine the conceptual foundations of CRM, it will be useful to define what is CRM. A narrow perspective of customer relationship management is database marketing emphasizing the promotional aspects of marketing linked to database efforts.

Another narrow, yet relevant, viewpoint is to consider CRM only as customer retention in which a variety of after marketing tactics is used for customer bonding or staying in touch after the sale is made.

Shani and Chalasani define relationship marketing as “an integrated effort to identify, maintain, and build up a network with individuals consumers and to continuously strengthen the network for mutual benefit of both sides, through interactive, individualized and value-added contacts over a period of time”.

The core theme of all CRM and relationship marketing perspectives is its focus on cooperative and collaborative relationships between the firm and its customers, and/or other marketing actors.

CRM is based on the premise that, by having a better understanding of the customers’ needs and desires we can keep them longer and sell more to them.

Growth Strategies International (GSI) performed a statistical analysis of Customer satisfaction data encompassing the findings of over 20,000 customer surveys conducted in 40 countries by Infoquest.

The conclusions of the study were: • A Totally Satisfied Customer contributes 2.6 times as much revenue to a company as a Somewhat Satisfied Customer.

• A Totally Satisfied Customer contributes 17 times as much revenue as a Somewhat Dissatisfied Customer.

4

• A Totally Dissatisfied customer decreases revenue at a rate equal to 1.8 times what a Totally Satisfied Customer contributes to a business.

• By reducing customer defection (by as little as 5%) will result in increase in profits by 25% to 85% depending from industry to industry.

An important facet of CRM is “customer selectivity”. As several research studies have shown not all customers are equally profitable (Infact in some cases 80% of the sales come through 20% of the customers). The company must therefore be selective and tailor its program and marketing efforts by segmenting and selecting appropriate customers for individual marketing programs. In some cases, it could even lead to “ outsourcing of some customers” so that a company better utilize its resources on those customers it can serve better and create mutual value. However, the objective of a company is not to really prune its customer base but to identify appropriate customer programs and methods that would be profitable and create value for the firm and the customer. Hence, CRM is defined as:

5

INTRODUCTION

Differentiate Customers: All customers are not equal; recognize and reward best customers disproportionately. Understanding each customer becomes particularly important. And the same customers’ reaction to a cellular company operator may be quite different as compared to a car dealer. Besides for the same product or the service not all customers can be treated alike and CRM needs to differentiate between a high value customer and a low value customer.

What CRM needs to understand while differentiating customers is: - Sensitivities, Tastes, Preferences and Personalities - Lifestyle and age - Culture Background and education - Physical and psychological characteristics •

Differentiating Offerings

→ Low value customer requiring high value customer offerings → Low value customer with potential to become high value in near future → High value customer requiring high value service → High value customer requiring low value service

6

High

Low value customers who Low value customers who require high levels of service require high levels of service

Service Requirement

must either purchase the higher must either purchase the higher level of service or become our level of service or become our competitors low value/high cost competitors low value/high cost customers customers

High value customers who High value customers who require a high level of service require a high level of service are maintained without are maintained without expanding the costly offering expanding the costly offering to the entire customer to the entire customer population population

Low Low

Keeping Existing Customers

High

Customer Value

Fig. Customer value – Service Matrix Grading customers from very satisfied to very disappointed should help the organisation in improving its customer satisfaction levels and scores. As the satisfaction level for each customer improve so shall the customer retention with the organisation. •

Maximizing Life time value

Exploit up-selling and cross-selling potential. By identifying life stage and life event trigger points by customer, marketers can maximize share of purchase potential. Thus the single adults shall require a new car stereo and as he grows into a married couple his needs grow into appliances. •

Increase Loyalty

Loyal customers are more profitable. Any company will like its mindshare status to improve from being a suspect to being an advocate.

Company has to invest in terms of its product and service offerings to its customers. It has to innovate and meet the very needs of its clients/ customers so that they remain as advocates on the loyalty curve. Referral sales invariably are low cost high margin sales.

(Fig. Categorizing Customers)

7

High Low Strategic Importance To Your Business Plan

*You have No Choice But To Handle Them Very Carefully.

Will Consume Energy

*Cultivate Relationship.

Spend Energy.

Go Out Of Your Way.

# Think Of Innovative Ways of Getting them On Your Side, But The ‘Cost Of Acquisition’ Must Be Controlled

#Think Of Strategies TO Move Them Away From Competition.

Will Consume Disproportionately High Energy.

*Existing Customers #Potential

*Focus On Short Term Profitability.

Spend Minimum Energy To Meet Your Objectives.

*Very cautious decision needed. Re-examine Customers business Plan & Strategy. Evaluate That Your Loss (i.e. Your competitor’s gain) Doesn’t become nightmare for you.

#Don’t Pursue.

Use Opportunity As It Comes.

Short Term Acquisition Shouldn’t Affect Long Term Image.

#Needs In-depth strategic review as acquisition alone and dissatisfaction later could be more harmful

Low

High

Relationship & Profitability Potential Summarizing CRM activities: The CRM cycle can be briefly described as follows: 1. Learning from customers and prospects, (having in depth knowledge of customer) 2. Creating value for customers and prospects 3. Creating loyalty 4. Acquiring new customers 5. Creating profits 6. Acquiring new customers Learning from customers a& prospects

Creating Profits

Fig. CRM Activities

Acquiring new customers

1

5 3

Creating value for customers & 4 prospects Figure Customer Life Cycle Management Creating loyal customers

2

8

Customer Need Assessment & Acquisition

Customer Retention and referrals for new customers Customer Development through personalization and customization

Customer Equity Leverage through Cross Selling and Up Selling

The Emergence of CRM Practice The Past: Looking back at a snapshot history of marketing, we can see the following clear developments and progression over the last four decades: • 1960’s – the era of Mass Marketing, when Gibbs SR toothpaste began the first marketing of this kind with its black and white campaign.

• 1970’s – saw the beginning of segmentation, direct mail campaigns and early telemarketing (such as publishing) • 1980’s – where Niche marketing made millionaires of those who were best at it.

• 1990’s – Relationship Marketing. The explosion of telemarketing and call centres, all set up to develop relationships with customers. The recognition of the true value of retention and the use of Lifetime Value as a business case.

9

In addition to this, a number of key marketing concepts can also be used to see where CRM has developed from: •

Satisfying Needs, Customer Orientation

•

The organisation needs to be arranged so that all functions contribute

•

Profit must be the consequence of delighting customers (Kotler)

Developing customer relationship has historical antecedents going back into the pre industrial era. Similarly artisans often developed customized produce for each customer.

Such direct interaction led to relational bonding between the producer and the consumer.

It was only after industrial era’s mass production society and the advent of the middlemen that there were less frequent interactions between producers and the consumers leading to transactions oriented marketing. The production and consumption factions got separated leading to marketing functions being performed by the middle men and middlemen are in general oriented towards the economic aspects of buying since the largest cost is often the cost of goods sold.

In recent years however, several factors have contributed to the rapid development and evolution of CRM. These include: 1. The growing de-intermediation process in many industries due to the advent of sophisticated computer and telecommunication technologies that allow producers to directly interact with end-customers. For example, in many industries such as airlines, banks insurance, software or household appliances and even consumables, the de-intermediation process is fast changing the nature of marketing and consequently making relationship marketing more popular. Databases and direct marketing tools give them the means to individualize their marketing efforts.

2. Advances in information technology, networking and manufacturing technology have helped companies to quickly match competition. As a result product quality and cost are no longer significant competitive advantages.

3. The growth in service economy. Since services are typically produced and delivered at the same institution, it minimizes the role of the middlemen.

10

4. Another force driving the adoption of CRM has been the total quality movement.

When companies embraced TQM it became necessary to involve customers and suppliers in implementing the program at all levels of the value chain. This needed close working relationships with the customers. Thus several companies such as Motorola, IBM, General Motors, Xerox, Ford, Toyota, etc formed partnering relations with suppliers and customers to practice TQM. Other programs such as JIT and MRP also made use of interdependent relationships between suppliers and customers.

5. Customer expectations are changing almost on a daily basis. Newly Empowered customers who choose how to communicate with the companies across various available channels. Also nowadays consumers expect a high degree of personalization.

6. Emerging real time, interactive channels including e-mail, ATMs and call centre that must be synchronized with customer’s non-electronic activities. The speed of business change, requiring flexibility and rapid adoption to technologies.

7. In the current era of hyper competition, marketers are forced to be more concerned with customer retention and customer loyalty.

8. As several researches have found out retaining customers is less expensive and more sustainable competitive advantage than acquiring new ones.

9. On the supply side it pays more to develop closer relationships with a few suppliers than to develop more vendors.

10. In addition several marketers are concerned with keeping customers for life than making one time sale. There is a greater opportunity for up selling and cross selling.

In a recent study, Naidu, et al(1999) found that relational intensity increased in hospitals facing a high degree of competitive intensity 11. The globalization of world marketplace makes it necessary to have global account management for the customers.

CRM Formation Process In the formation process, three important decision areas relate to defining the purpose (or objectives) of engaging in CRM, selecting parties (or customer partners) for appropriate CRM programs and developing programs (or relational activity schemes) for relationship engagement with the customer.

11

Purpose  

Increase Effectiveness Improve Efficiency

Role Specification -

Planning Process Process Alignment

Programs  

Account Management Retention Marketing

Monitoring Process

Relationship Performance  Strategic  Financial  Marketing → Retention → Satisfaction → Loyalty

Communication Team Structure Employee Motivation

Partners  

Criteria Process Employee Training

Evolution • Enhancement • Improvement

Fig.

CRM Process Framework

CRM Purpose The overall purpose of CRM is to improve marketing productivity and enhance value for parties in involved in the relationship. By seeking and achieving operational goals, such as lower distribution costs, streamlining order processing and inventory management, reducing the burden of excessive customer acquisition cost, and through customer retention economics, firms could achieve greater marketing efficiencies. They can enhance marketing effectiveness by carefully selecting, customers for its various programs, individualizing and personalizing their market offerings to anticipate and serve 12

the emerging needs of individual customer, building customer loyalty and commitment, partnering to enter new markets and develop new products, and redefining the competitive playing field for their company. Thus, stating the objectives and defining the purpose of CRM in a company helps clarify the nature of CRM programs and activities that ought to be performed by the partners. Defining the purpose would also help in identifying suitable relationship partners who have necessary expectations and capabilities to fulfill mutual goals. It will further help in evaluating CRM performance by comparing results achieved against objectives. These objectives could be specified as financial goals, marketing goals, strategic goals, operational goals, and general goals.

Customers are motivated to engage in relational behavior because of psychological and sociological benefits associated with reduction in choice decisions. In addition, to their natural inclination of reducing choices, consumers are motivated to seek the rewards and benefits associated with CRM programs.

Relational Parties In the Initial phase, a company has to decide which customer type and specific customers or customer groups will be the focus of their CRM activities.

CRM Programs A careful review of literature and observation of corporate practices suggest that there are three types of CRM programs: continuity marketing; one-to-one marketing; and, partnering programs. These take different forms depending on whether they are meant for end-consumers, distributor consumers, or business-to-business customers.

Table presents various types of CRM programs developed for different types of customers.

13

Customer Types Program Types

Mass Markets

Distributors

Business to Busin ess Markets

• • •

After- Marketing Loyalty Programs Cross-Selling

•

One-to-One Marketing

•

Partnering/CompanyMarketing

• • •

Permission Marketing Personalization Affinity Partnering Co-Branding

Continuity Marketing

Continuos Replenishment ECR Programs

•

Special Sourcing Arrangements

•

Customer Business Development

• •

• •

Logistics Partnering Joint Marketing

•

Key Account Global Account Strategic Partnership Co-Design CoDevelopment

•

• •

Table CRM Programs Continuity Marketing Programs Take the shape of membership and loyalty card programs where customers are often rewarded for their member and loyalty relationships with the marketers. The basic premise of continuity marketing programs is to retain customers and increase loyalty through long-term special services that has a potential to increase mutual value through learning about each other.

One-to-one Marketing Meeting and satisfying each customer’s need uniquely and individually. In the mass markets individualized information on customers is now possible at low costs due to the rapid development in the information technology and due to availability of scalable data warehouses and data mining products. By using online information and databases on individual customer interactions, marketers aim to fulfill the unique needs of each massmarket customer. Information on individual customers is utilized to develop frequency marketing, interactive marketing, and aftermarketing programs in order to develop relationship with high-yielding customers. In the context of business-to-business markets, individual marketing has been in place of quite sometime. Known as Key Account

14

Management Program, here marketers appoint customer teams to husband the company resources according to individual customer needs.

Partnering Programs The third type of CRM programs is partnering relationships between customer and marketers to serve end user needs. In the mass markets, two types of partnering programs are most common: co-branding and affinity partnering.

CRM Governance Process •

Greater the scope of CRM program and associated tasks, and the more complex is the composition of the relationship management team; the more critical is the role specification decision for the partnering firms.

•

It is essential to establish intra-company communication particularly among all concerned individuals and corporate functions that directly play a role in managing the relationship with a specific customer or customer group.

•

With mass-market customers frequent face-to-face interactions will be uneconomical.

Thus marketers should create common bonds through symbolic relationships, endorsements, affinity groups, and membership benefits or by creating online communities

•

Involving customers in the planning process would ensure their support in plan implementation and achievement of planned goals. All customers are not willing to participate in the planning process nor is it possible to involve all of then for relationship marketing programs for the mass markets.

•

Operating process between the company and customer partners: Operating alignment will be needed in order processing, accounting and budgeting processes, information systems, merchandising process, etc

•

Human resources decisions are also important in creating the right organisation climate for managing relationship marketing. Training employees to interact with 15

customers, to work in teams, and manage relationship expectations are important. So is the issue of creating the right motivation through incentives and rewards.

•

Periodic evaluation of goals and results, initiating changes in relationship structure, design or governance process if needed, creating a system for discussing problems and resolving conflicts.

CRM Performance Evaluation Process Without a proper performance metrics to evaluate CRM efforts, it would be hard to make objective decisions regarding continuation, modification, enhancement, or termination of CRM programs.

If co-operative and collaborative relationship with the customers is treated as an intangible asset of the firm, its economic value add can be assessed using discounted future cash flows estimates. Here the term relationship equity comes in where you measure the intangible assets of the firm.

Another global measure used by firms to monitor CRM performance is the measurement of relationship satisfaction. By measuring relationship satisfaction, one could estimate the propensity of either party’s inclination to continue or terminate the relationship. Such propensity could also be indirectly measured by measuring customer loyalty.

CRM Implementation Issues One of the most interesting aspects of CRM development is the multitude of customer interfaces that a company has to manage in today’s context. Until recently, a company’s direct interface with the customers, if any was primarily through sales people or service agents. In today’s environment most companies interface with their customers through a variety of channels including sales people, service personnel, call centres, Internet websites, marketing departments, fulfillment houses, market and business development agents, etc. For large customers it also includes cross-functional teams that may include personnel from various functional departments. While each of these units could operate independently, they still need to share information about individual customers and their

16

interactions with the company on a real time basis. For example, a customer who just placed an order on the Internet and subsequently calls the call centre for order verification expects the call centre staff to know the details of his or her order history. Similarly a customer approached by a sales person unaware that she has recently complained about dissatisfactory customer service, is not likely to be treated kindly by the customer.

Therefore effective CRM requires a front-line information system that shares relevant customer information across all interface units. Relational databases, data warehousing and data mining tools are thus very valuable for CRM systems and solutions.

However, the challenge is to develop and integrated CRM platform that collects relevant data input at each customer interface and simultaneously provides knowledge output about the strategy and tactics suitable to win customer loyalty and support. If a call centre personnel cannot identify or differentiate a high value customer and does not know what to up-sell or cross sell to him then it would be a tremendous loss of opportunity for the company. Although most CRM software solutions based on relational databases are helping share customer information, they still do not provide knowledge output to the front line personnel. As shown in Figure.6, CRM solutions platform needs to be based on interactive technology and processes. It should assist the company in developing and enhancing customer interactions and one-to-one marketing through the help of suitable intelligent agents that help develop front-line relationship with customers. Such a system would identify appropriate data inputs at each customer interaction site and use analytical platforms to generate appropriate knowledge output for front-line staff during customer interactions.

In addition, implementation tools to support interactive solutions for customer profitability analysis, customer segmentation, demand generation, account planning, opportunity management, contact management, integrated marketing communication, customer care strategies, customer problem solving, virtual team management of large global accounts, and measuring CRM performance would be the next level of solution sought by most enterprises.

Internet 17

Sales Group Knowledge Output

Data Input Knowledge Output

Data Input Knowledge Output

Market Development

Data Input

Integrated Marketing Information Platform • Information Content • Relational Databases • Decision Support System • Active Intelligence • Business Rules • Collaborative Communication • User Profiles

Knowledge Output Data Input

Data Input

Call Centre

Knowledge Output Data Input

Knowledge Output

Marketing

Customer Operations/ Service

Figure. Information Platform for CRM Since CRM implementation comprises a significant information technology (IT) component, these companies have handed over the responsibility of CRM implementation to information technology departments. They are focussed on simply installing CRM software solutions without a CRM strategy or program in place. This leads to creating an operational tool within the company, but the usability and effectiveness in producing desirable results from such tools is limited. CRM tools would be valuable when they are used to identify and differentiate individual customers and to generate individualized offer and fulfill customized solutions. The lack of CRM strategy or CRM programs, would leave the front-line people without any knowledge of what they should be doing with the additional customer information that they now have access to.

For those who apply themselves and develop improvised solutions, it could backfire as ad

18

hoc solutions could cause unintended deterioration in customer relationships. Appropriate strategy and excellent implementation are both needed for obtaining successful results.

From a corporate implementation point of view, CRM should not be misunderstood to simply mean a software solutions implementation project.

Knowledge Management (KM) with focus on CRM As Peter Drucker defined “Information is data endowed with relevance and purpose”.

To effectively implement a CRM solution it is very important to identify real knowledge about different types of customers (Viz. Most valued customers, Most growable customers, Below zero customers) from plethora of internal and external data, figures, surveys, etc. A straightway technique is to create a data warehouse, thereafter information which is required to effectively implement principles of CRM, could be mined out of this data warehouse.

Marketing, sales after-sales people would be knowledge workers. Front office could be more productive if they could utilize customer knowledge. Knowledge Management (KM) is about embracing a diversity of knowledge resources, like legacy systems, existing data warehouses, portals, websites, customers, suppliers, partners, external marketing research agencies and cultivating the knowledge where it resides.

Metrics, ROI, Balance Scorecard method, benchmarking are some of the common technique of KM system evaluation. KM implementation is the key to CRM. It’s a proven fact that 80% of an organisation revenues come form 20% of its customers, it becomes imperative to design CRM solutions keeping in mind these most valuable customers and to leverage 80% non structured data of about 20% of these most valuable customers.

Just as more tangible corporate assets like computer systems have a finite shell life, so too does knowledge, it must be available at the right time to be able to act upon it.

Retaining tacit knowledge (derived from experiences, data and documents) means 19

retaining the individual, which is invariably not possible. It is possible to generate explicit knowledge from tacit knowledge, but it’s a complex exercise. The key ingredient of this exchange is face to face sharing of knowledge or virtual environmental tools like Lotus Notes, which can facilitate tacit knowledge exchange. Hence for tacit knowledge exchange text mining is very useful and important. There are ways to do text mining, like search engines, web solutions, text analysis tools, etc. The key to successful customer KM is personalization, i.e. how to extract the knowledge that is pertinent to the user and translate it into a format that is easily understood. The choice of Customer Knowledge Management (CKM) architecture should have a layered approach. Existing systems should be seamlessly linked with the proposed layer. The choice for CKM system could be Web (Enterprise information portal) or a packaged solution such as Lotus Notes, Microsoft solution.

Role of CRM in the Context of SCM In the context of SCM, where alliances and partnerships are keys to success, CRM plays an important role in building long-term relationships. Apart from the end-users, it involves internal employees, channel members and other external entities such as advertising agencies and consulting organisations. The success of relationships depends upon sharing of savings from the supply chain, which may be reinvested to further enhance its efficiency, and sustain the competitive advantage.

The supply chain of tomorrow will look like a virtual organisation, seamlessly integrated through sharing data and savings as well. The bonding between partners will be closely held by CRM practices.

ERP and CRM Like ERP, CRM solutions focus on automating and improving business processes, albeit in front-office areas such as marketing, sales, customer service, and customer support.

Whereas ERP implementation can result in improved organisational efficiency, CRM aims to provide organisational effectiveness by reducing sales cycle and selling cost, identifying markets and channels for expansion, and improving customer value,

20

satisfaction, profitability, and retention. While CRM applications provide the framework for embodying, promoting and executing best practices in customer facing activities, ERP provides the backbone, resources and operational applications to make organisations more efficient in achieving these goals.

Regain Management “ The cost of acquiring a new customer is 9 to 12 times that of holding on to an existing customer.”-Philip Kotler A study conducted by Andersen Consulting in conjunction with EIU found that businesses are intensifying their focus on customer and are taking a more process oriented approach to customer relationship management. Key Findings of the study are: (a) the number of businesses citing customer retention as a critically important measure in the next 5 years has jumped to nearly 60%, as companies shift their focus from attracting new customer to retaining their more profitable ones; (b) by 2002, 83% of companies expect to have customer data warehouses, up from about 40% today; and (c) companies predict their use of Internet to collect customer data will surge by 430% Consumer Life Time Value Quantifying the “value” of customers is absolutely essential in regain management. In fact, the percentage of profit a company makes from continued sales to its own customer base is consistently higher than the profit made on original sale.. Each of the customers then delivers an income stream and the stream of profit far exceeds the value of original purchase. Income streams contribute cash flows in terms of years for any single product.

Regain Strategies: •

Customization 21

•

Differentiation Strategies

The lost customer would be segmented differently from the existing customer. Base and the company could provide additional features and benefits to win them back.

“Wow” Syndrome For example, a client checks into a hotel and his/her room isn’t ready. The clerk could respond by “You are in luck! Your room isn’t ready. That means you get to eat breakfast “on us” and use our business centre for free!”

Tools •

Customer database A good customer information system should consist of a regular flow of information, systematic collection of information that is properly evaluated and compared against different points in time, and it has sufficient depth to understand the customer and accurately anticipate their behavioral patterns in future. The customer database helps the company to plan, implement, and monitor customer contact. Customer relationships are increasingly sustained by information systems. Companies are increasingly adding data from a variety of sources to their databases. Customer data strategy should focus on processes to manage customer acquisition, retention, and development.

Other Technologies that are used are as follows: •

Electronic Point of Sale(EPOS)

•

Sales Force Automation

•

Customer Service Helpdesk

•

Call Centres

22

Call Centre helps in automating the operations of inbound and outbound calls generated between company and its customer. These solutions integrate the voice switch of automated telephone systems (e.g. EPABX) with an agent host software allowing for automating call routing to agents, auto display of relevant customer data, predictive dialing, self service Interactive Voice Response systems, etc. These systems are useful in high volume segments like banking, telecom and hospitality. Today, more innovative channels of interacting with customers are emerging as a result of new technology, such as global telephone based calls centres and the internet. Companies are now focusing to offer solutions that leverage the internet in building comprehensive CRM systems allowing them to handle customer interactions in all forms. •

Systems Integration

While CRM solutions are front office automation solutions, ERP is back office automation solution. An ERP helps in automating business functions of production, finance, inventory, order fulfillment and human resource giving an integrated view of business, where as CRM automates the relationship with customer covering contact and opportunity management , marketing and product knowledge, sales force management, sales forecasting, customer order processing and fulfillment, delivery, installation, presale and post-sale services and complaint handling by providing an integrated view of the customer. It is necessary that the two systems integrate with each other and complement information as well as business workflow. Therefore, CRM and ERP are complementary.

This integration of CRM with ERP helps companies to provide faster customer service through an enabled network, which can direct all customer queries and issues through appropriate channels to the right place for speedy resolution. This will help the company in tracking and correcting the product problems reported by customers by feeding this information into the R&D operations via ERP.

23

CRM – A FRAMEWORK

Traditional Approach to CRM

Web-Enabled & Integration Approach

• Customer Contact by − Telephone − Mail − In Person • Personal Selling • After Sales Service • Complaint Handling • Account Management • Customer care • Customer Satisfaction

• Customer Information System • Customer Database • Electronic Point of Sale • Sales Force Automation • Automation of Customer Support • Call Centres • Systems Integration • Lifetime value of a Customer

Integration with technology

(Web & Internet)

Data Mining for CRM: Some Relevant issues Data mining is an important enabler for CRM. Advances in data storage and processing technologies have made it possible today to store very large amounts of data in what are called data warehouses and then use data mining tools to extract relevant information.

Data mining helps in the process of understanding a customer by providing the necessary information and facilitates informed decision-making.

Operational CRM solutions involve integration of business processes involving customer touch points. Collaborative CRM involves the facilitation of collaborative services(such as e-mail) to facilitate interactions between customer and employees. All this effort produces rich data that feeds the Analytical CRM technologies.

24

Operational CRM

Analytical CRM

Collaborative CRM

Customer

Fig.8 Interactions between CRM Technologies

Information Requirements Of An Effective CRM Solution The employees of a firm employing CRM would require rich information about their firm and customer base including: •

Information about the market

•

Information about the firm

•

The current segment

•

Demographic Distribution (by age, sex, education, income, marital status, etc)

•

The firm’s best customers and the segment they belong to, products they buy, preferences, habits and tastes of each segment.

•

Individual level information consisting of: → Customer personal details such as name, address, family details, education, etc → The customer group /segment to which the individual belongs → History of present and past behavior → Likes, dislikes, habits and preferences

25

→ Events coming up in their personal life etc. 

Levels of data mining operations The aggregate or the Macro level Mining at the macro level gives us a broad overview of the data e.g. when customer of the retail store are segmented by profitability criteria, we obtain clusters who are profitable to various extent. Knowledge obtained by mining at macro level is useful when dealing with situations where: •

We are dealing with a customer about whom we do not have individual

information . Hence, we need to extrapolate the characteristics of the group to which he/she might belong. In retail store example, a store can segment its customers on basis of age and characteristics can be extracted. When a new customer enters the store, the salesman could use his intuition in arriving at the customer’s age and recover the characteristics of that age group such as the frequently bought products, colour preferences, etc.

•

Targeting new set of customers. If the retail chain has opened a new store it can

use the data from the most similar current store to predict the behavior of the new prospects.

•

We are dealing with aspects of the service, which influence a majority of the

customer and therefore cannot be customized to suit individual tastes, example being the design of the physical layout of a retail store.

•

Predicting the possibility of an action that the cu has never undertaken. A

customer might not have tried out a new product because he/she was not aware of it.

A salesman can encourage him/her to try out the product if his/her profile matches that of the current product users.

26

The Individual or Micro level As interactions of the individual with the firm increases, the firm obtains more data about him/her. Offering individualized value adding propositions can strengthen relationship with the individual customer. For this, we need to track the cu and mine at the individual or micro level. Some important features to note about mining at this level are: •

Micro-level mining provides specific information about a particular customer.

For example, the retail store can go to the extent of finding out the preferred colours of his shirt •

A firm takes up micro level mining to build a detailed customer profile of a

regular customer.

•

Data mining this level might be expensive if the data mining tool has to cull

out individual information from a large database. Having a separate database for profitable customer might be helpful.

•

Knowledge obtained at the individual level is useful in situations where: −

The firm wants to customize its offering to the customer based on the customer’s tastes and preferences e.g. the retail store can offer discounts on the purchase of a bundle of products that the customer prefers buying together.

−

The firm wants to assist the purchase of a new product based on the information it has of the last purchase. For example, if a customer has bought a suit in his visit, then the store might offer a discount on the purchase of a tie of a matching colour.

−

The firm wants to take advantage of the personal events in a customer’s life (e.g. birthdays, anniversaries, birth of child etc.) to further cement the precious relationship.

27

−

Current patterns that go against usually observed customer behavior point to interesting phenomenon. If retail customer suddenly switches brand then he/she might not be satisfied with the last purchase.

The most common operations used at this level are: Classification: Classification is a process that maps a given data item into one of the several predefined classes. CRM uses classification for a variety of purposes like behavior prediction, product and customer categorization.

Regression Regression is the operation of learning a function that predicts the value of a real valued dependent variable based on values of other independent variables. Regression finds application in a CRM environment where prediction needs to be made about the behavior regarding real value added variables. Suppose the retail store collects data on the monthly visits of the customers viz. Frequency, time spent on each visit. And purchases made during each visit. If the manager has a strong intuition that total purchase is linked to frequency of visit, then this situation can be modeled by regression. This model can then be used to predict future purchases of a customer. Regression needs sufficient amount of data to be reliable and valid.

Link Analysis Link Analysis seeks to establish relationship between items or variables in a database record to expose patterns and trends. Link analysis can also trace connections between items of record over time. The most important link analysis application in CRM, called market basket analysis, is an operation that seeks relationship between product items characterizing product affinities or buyer preferences. The retail store collects thousands of interactions daily. A link analysis task performed on this data will point to items that are bought together e.g. bread and butter are bought together rather than bread and orange juice. Such information can be used to design store layouts, design coupons, etc.

28

Segmentation Segmentation aims to identify a finite set of naturally occurring clusters or categories to describe data.

Deviation Detection Deviation Detection (DD) focuses on discovering the most significant changes in the data from previously measured, expected or normative values. Most CRM solutions have a DD task running in parallel on a regular basis. Suppose a retailer finds out that the sales from a particular section of the store have been much less than expected. This deviation on further analysis points out to non-stocking of a popular brand.

Tools such as decision trees, rule induction, case based reasoning, visualization techniques, nearest neighbor techniques, clustering algorithms, etc are used for the above purposes.

The existing CRM Solutions Delivering the ‘360 view’ requires automation to bring together all the data concerning a customer. This implies the organisation has to change from: Mass Marketing

Product Focus

Product Focus

Customer Focus

Economies of Scale

Economies of time

1 way communication

Interactive

Response Time

Real Time

Present CRM Alternatives Present CRM solutions are offered by host of vendors that are to a great extent not industry specific. While there are some vendors, who have come up with industry specific solutions, the broad model around which the CRM solutions are built remain the same. Adopting a similar or a look a like solution across industries is what causes major strain in servicing a customer.

29

Typical offerings of the current CRM solutions (such as Siebel, Oracle Apps or MySap.com, etc) vary from solution to solution. However typical CRM offerings consist of: Customer Development

Field sales, Tele sales, Internet Sales

Service Centre

Call Centres, Field Service

Sale management and support

Internet Customer Service

Market Analysis

Service Interaction Centre

Internet, Tele marketing

Business Partner Collaboration

Product and brand management The Customer focussed organisation: CRM Model The idea here is to develop systems that allow flexibility, work on not completely predefined processes so as to enable front office to be proactive to each customer needs The Mindset impact on CRM A typical data warehouse will have the following components: • While developing a data warehouse one takes into account all the legacy and operation systems. But typically sales teams could be managing leads on an excel worksheet.

Sometimes critical DSS input like “Profitability Analysis” itself may reside on a worksheet.

30

Data Warehouse Legacy & Operation Extract & Transfer

Risk Cube

FP&A Cube

Mktg & Sales Cube

Campaign Mgmt

OLAP Tool

Thus a Data Warehouse solution must be able to accept information from such “unstructured� sources as well as budget for an open architecture to enable plug-in for systems to be developed in the future. a) Generally the existing information is mapped into a data warehouse. Since a customer centric info-base is being developed, its is critical that extensive customer research is done to identify their information needs and thus what profile data will be relevant for us. Thus any data-warehousing project needs to work closely with the research team. b) After extracting the data from various systems, we need to scrub and clean the data, deduplicate. c) Even though we may find 80% of the names in a database of a million customers using combinations of lets say a 1000 first and last names, to take into account all possible combinations we may actually need a database of 10,000 first and last names. Even then we may not be able to comprehensively cover all future combinations. Now, the system must expect this kind of input on a regular basis

31

rather than it happening by exception, as is the case with updating “masters” in a traditional system. d) Ad-hoc querying is a tool that is most often used in such applications. Unfortunately not much effort is made to make this tool “end-user” friendly so that even a layman could run his/her reports. Typically a data-warehouse and data mining person is placed in information technology to manage all queries. With the advent of tools like MetaData Repository, drill down OLAP tools and Palm Pilots it is now possible for hardcore marketing and sales types to directly access and run their queries. Infact we need to budget for training the sales and marketing team with the use of datawarehouse. e) The real power of the CRM system is its ability to provide a rich, value added experience to our customers at all touch points – call Centres, kiosks, retail outlets, mobile devices, Internet and branches. Integration and information dissemination must happen at all these points. Thus the CRM specialist in marketing must be well versed with all these tools and techniques. eCRM What is eCRM? In simplest terms eCRM provides companies with means to conduct interactive, personalized and relevant communications with customer across both electronic and traditional channels. It utilizes a complete view of the customer to make decisions about messaging, offers and channel delivery. It synchronises communication across otherwise disjoint-customer facing systems. It adheres to permission based practices, respecting individual’s preferences regarding how and whether they wish to communicate with you and it focuses on understanding how the economics of customer relationship affect the business.

32

eCRM Vs CRM CRM is essentially a business strategy for acquiring and maintaining the “right” customers over the long term. Within this framework, a number of channels exist for interacting with customers. One of these channels is “electronic” – and has been labeled “e-commerce” or “e-business”. This electronic channel does not replace the sales force, the call Centre, or even the fax. It is simply another extension, albeit a powerful new one, to the customer. The thrust of eCRM is not what the organisation is “doing on the web” but how fully the organisation ties its on-line channel back to its traditional channels, or customer touch points.

Why employ eCRM? Companies need to take firm initiatives on the eCRM frontier to •

Optimize the value of interactive relationship

•

Enable the business to extend its personalized reach

•

Company-ordinate marketing activities across all customer channels.

•

Leverage customer information for more effective emarketing and ebusiness

•

Focus the business on improving customer relationship and earning a greater share

of each customer’s business through consistent measurement, assessment and “actionable” customer strategies.

The six “E’s” of eCRM 1. Electronic channels 2. Enterprise 3. Empowerment 4. Economics

33

5. Evaluation 6. External Information eCRM Architecture The primary inputs to this module are mainly from the eCRM Assessment and strategy alignment modules. During this stage the company will try and develop a Connected Enterprise Architecture (CEA) within the context of the company’s own CRM strategy.

The following is a set of technical eCRM capabilities and applications that collectively and ideally comprise a full eCRM solution: •

Customer Analytical Software

•

Data mining software

•

Campaign Management software

•

Business Simulation

•

A real time decision engine

Review and Assessment of CRM solutions CRM software applications embody best practices and employs advanced technologies to help organisations achieve these goals.

Categories of CRM solutions Any enterprise , which wants to implement CRM solutions can choose from four categories of solutions −

Integrated applications suite

−

Interfaced applications bundle

−

Interfaced best of breed solutions

34

−

Best of cluster

Selecting an interfaced best of breed approach for pure functionality or a front office application suite solely for integration limits enterprise choices. Enterprises need to start with a clear picture of the basic truths of integration, interfacing and functionality. An integrated application suite is a set of application that employs a common architecture, referencing a common logical database with a single schema. Some suites are more often interfaced application bundle i.e. a set of interfaced application from a single vendor containing more than one technical architecture or more than one logical databasefrequently assembled by the vendor through the process of acquisition or partnership An alternative approach to suites is an interfaced best of breed solution – an approach whereby an enterprise selects from multiple vendors a set of applications that must be interfaced to work together, either by the enterprise, one of the selected vendors or a third party integrator. The individual applications are not the best in any objective sense.

Rather, some enterprises select the applications because they best meet the particular needs. The challenge of this approach is that, in some cases, the enterprise fails to complete the necessary interfaces to get the individual applications working together; consequently, the applications remain stove pipes. Best of cluster is similar to best of breed except that here best is chosen from the cluster and they are interfaced.

Key requirements for CRM solutions Some of the functional and technical requirements for CRM solutions are as listed below: •

Business intelligence and analytical capabilities

•

Unified channels of customer interactions

•

Support for web based functionality

•

Centralized repository for customer information

•

Integrated work flow

35

•

Integration with ERP applications

Functional Components of CRM solution CRM applications are a convergence of functional components, advanced technologies and channels. Functional components and channels are described below: Sales applications Common applications include calendar and scheduling, contact and account management; compensation; opportunity and pipeline management; sales forecasting; proposal generation and management; pricing; territory assignment and management; and expense reporting.

Marketing applications These include web based and traditional marketing campaign planning, execution, and analysis;list generation and management; budgeting and forecasting; collateral generation and marketing materials management.

Customer service and support applications These include customer care; incident, defect and order tracking; field service; problem and solution database; repair scheduling and dispatching; service agreements and contracts; and service request management.

Given below is a brief review of what some of the known vendors in this area have in their applications for these verticals. The table 2 at the end gives comparative assessment of the products discussed below for the above verticals: •

SIEBEL

It continues to out market and out sell the competition. It is one of the few front office suite vendors having vertical specific functions. Its functionality is compelling. It can be integrated with most of the back office solution like SAP and Oracle. It has solutions for

36

automotive, public sector (US), communications, consumer goods, apparel and footwear, energy, finance, insurance, health care, life sciences and high technology industry sectors.

The solutions for the verticals described above are discussed below: • For Consumer goods: a Siebel eConsumer goods offers eBusiness solution spanning the entire demand chain from the end consumer, through the retailer and the wholesaler, to the manufacturer. It has robust trade promotions planning functionality allowing users to manage customer promotion plans and the funds to support them, while comprehensive route planning functionality enables integrated account targeting. Using Siebel eConsumer Goods, organisations can also identify customer-buying behaviors and translate this understanding into new trade promotions and product offerings • For Financial Services: Siebel eFinance enables banking, brokerage, insurance, and capital market organisations to establish and maintain long term profitable relationship with consumers, small businesses, and corporate customers. The organisations can capitalize on information captured during each customer interaction to more effectively cross-sell and up-sell additional products and services.

Additionally, Siebel eFinance provides a comprehensive view of the entire customer relationship across multiple product lines, enabling financial service organisations to provide a personalized experience across all channels.

• For Healthcare: Siebel eHealthcare gives organisations the ability to streamline and improve sales, member services, medical management, and network management services. By using multiple distribution channels, including the Internet, call Centres, home office staff and independent brokers, Siebel eHealthcare provides organisations with a single view of their customers, thereby ensuring better service and improved quality of care.

• For telecom service providers: Siebel eCommunications helps wireless, cable, and Internet service providers to target and win the right customers, accelerate service delivery, and provide service across all touchpoints. Siebel eCommunications

37

embodies the industry’s best practices for generating accurate service orders, managing billing inquiries and adjustments, and up-selling and cross-selling additional services. By using Siebel eCommunications’ integration technology, service representatives and salespeople can instantly access information such as billing, order management, and network management from Operation Support Systems (OSS), to deliver highly responsive customer support and significantly increase sales.

Siebel 99, the vendor's major release, boasts 117 applications that span sales and service and incorporate multiple vertical markets.

A major effort in the new application release is it integrates all the channels companies use to contact customers: Web, E-mail, voice, wireless and face-to-face contact.

Some of Siebel employee-

Some of Siebel customer-

Some of the additional products

facing applications are:

facing applications are:

available in version 6.0

Siebel Call Center

Siebel eChannel

Siebel eMail Response

Siebel eCustomer

Siebel Communications Server

Siebel Field Service

Siebel eMarketing

Siebel Distance Learning

Siebel Marketing

Siebel eSales

Siebel Global Enterprise Support

Siebel Sales

Siebel eService

Siebel Language Extensions

Siebel Service

•

Siebel eBusiness Connector for SAP R/3 ®

Siebel Wireless

Clarify

38

It offers customer service & support and field service suite; however its sales functionality is immature. •

Oracle

Oracle is betting everything on its thin, Web Based, centralized computing model. The Internet computing architecture is compelling for connected non-mobile users; Oracle is rebuilding functionality on the new platform and integrates its various acquired products.

It offers a broad set of functionality across e-commerce, front office and business intelligence applications. •

Vantive

Vantive offers a compelling customer service and support and field service suite. The rest of its front office functionality makes it suite more of a bundle. The solution is integrated with PeopleSoft at the back office.

Table Comparative Assessment of CRM Products for Vertical Specific Requirements CRM Application Requirement

Siebel

Clarify

Oracle

Vantive

Category Management

Available

Available

Available

Available

Promotion Management

Available

Available

Available

Available

Demand Planning

Available

N.A.

Available

N.A.

Interactive Selling

Available

Available

Available

Available

Available

Available

Available

Available

Consumer Products

Telecom Service Providers Blended Sales & service contact Centre

39

Competitive Pricing Analysis

N.A.

N.A.

N.A.

N.A.

Integration with Billing System

Available

Available

Available

N.A.

Churn management

Available

Available

Available

N.A.

Contact Centre

Available

Available

Available

Available

Profitability Analysis

Available

Available

Available

Available

Integrated Targeting

N.A.

N.A.

Available

N.A.

Marketing Datamining

N.A.

N.A.

Available

N.A.

Contract Management

Available

N.A.

Available

N.A.

Marketing Analysis

N.A.

Available

N.A.

N.A.

Disease Education System

Available

N.A.

N.A.

N.A.

Knowledge Management System

Available

Available

N.A.

Available

Commercial Banking

Pharma & Healthcare

Some Indian CRM solutions are by Sales Logix, Logix Microsystems, Sonata Software, Oracle India, L&T information technology, etc.

Other CRM solutions are Aurum, Epiphany, Avyaya and Onyx.

Some frequent modules that most CRM have is:

40

Forecast Management, Encyclopedia Management, Campaign Management, Brand Management, Opportunity Management, and Event Management.

CRM solutions are interwined combinations of technology and business processes. In order to be effective CRM service providers will need a balanced understanding of both products and services. It’s necessary to have an expertise in not CRM technology but also customer service processes.

The potential use of CRM lies in it being the leading indicator of future revenue than just being used as a customer facing transaction-processing tool or as a lagging indicator communicating past consumer grievances.

The complete concept of CRM can be mapped on a technology solution as per the following blue print. The databases feed the technology infrastructure which links You with the customer touch points.

Thus we have four components of a CRM initiative rollout •

Customer Value Management Strategy

•

CRM roadmap keeping in mind industry nuances

•

Database solutions

•

Customer access channels

41

INDUSTRY INTRODUCTION FMCG product is well known as fast moving consumer goods. The FMCG products are the daily need based product like health care, fabric care, hair care, baby care, oral care, personal care etc. Because of the daily needs these products have the demand in the market. In personnel care these product play a vital role in daily life like shampoo, shaving cream, hair oil, detergent bar, toothpaste etc.

Indian population potential is huge that’s why India is a big market for FMCG The big player like wall mart Bharti, reliance, Amway, Chaupal fresh, Birla are entering in FMCG sector. P&G and HUL are already existing big player in FMCG sector because of the increasing competition P&G launches the different schemes one of them is ‘golden store’. That’s why how it is beneficial to wholesaler and retailer; the study of golden store is introduced.

Fast Moving Consumer Goods (FMCG), also known as Consumer Packaged Goods (CPG), is a product that is sold quickly at relatively low cost. Though the absolute profit made on FMCG products is relatively small, they generally sell in large quantities, so the cumulative profit on such products can be large. The Procter & Gamble Company is focused on providing branded products to improve the lives of the world's consumers.

Today, the Company markets over 300 branded products in more than 160 countries.

Procter & Gamble markets over 300 branded products in more than 160 countries. The Company has operations in over 80 countries through its Market Development Organization "MDO". The MDO includes dedicated retail customer, trade channel and country-specific teams that work to build the Company's brands in local markets. It is organized along seven geographic areas: North America, Western Europe, Northeast Asia, Latin America, Central and Eastern Europe/Middle East/Africa, Greater China and ASEAN/Australasia/India.

P&G and Gillette merge into one company and add five more Billion Dollar Brands to our product portfolio including Gillette and Braun's shaving and grooming products, the Oral-B dental care line and Duracell batteries.

42

OVERVIEW OF FMCG SECTOR IN INDIA The Indian FMCG sector is the fourth largest sector in the economy with a total market size in excess of US$ 13.1 billion.

It has a strong MNC presence and is characterized by a wellestablished distribution network, intense competition between the organized and unorganized segments and low operational cost. Availability of key raw materials, cheaper labour costs and presence across the entire value chain gives India a competitive advantage.

The FMCG market is set to treble from US$ 11.6 billion in 2003 to US$ 33.4 billion in 2015. Penetration level as well as per capita consumption in most product categories like jams, toothpaste, skin care, hair wash etc in India is low indicating the untapped market potential. Burgeoning Indian population, particularly the middle class and the rural segments, presents an opportunity to makers of branded products to convert consumers to branded products. Growth is also likely to come from consumer 'upgrading' in the matured product categories. With 200 million people expected to shift to processed and packaged food by 2010, India needs around US$ 28 billion of investment in the foodprocessing industry.

India is one of the largest emerging markets, with a population of over one billion. India is one of the largest economies in the world in terms of purchasing power and has a strong middle class base of 300 million. Around 70 per cent of the total households in India (188 million) reside in the rural areas. The total number of rural households is expected to rise from 135 million in 2001-02 to 153 million in 2009-10. This presents the largest potential market in the world. The annual size of the rural FMCG market was estimated at around US$ 10.5 billion in 2001-02. With growing incomes at both the rural and the urban level, the market potential is expected to expand further.

43

Rural and urban potential Rural-urban profile Urban

Rural

Population 2001-02 (mn household)

53

135

Population 2009-10 (mn household)

69

153

% Distribution (2001-02)

28

72

Market (Towns/Villages)

3,768

627,000

Universe of Outlets (mn)

1

3.3

Source: Statistical Outline of India (2001-02), NCAER An average Indian spends around 40 per cent of his income on grocery and 8 per cent on personal care products. The large share of fast moving consumer goods (FMCG) in total individual spending along with the large population base is another factor that makes India one of the largest FMCG markets.

44

Rapid urbanization, increased literacy and rising per capita income, have all caused rapid growth and change in demand patterns, leading to an explosion of new opportunities.

Around 45 per cent of the population in India is below 20 years of age and the young population is set to rise further. Aspiration levels in this age group have been fuelled by greater media exposure, unleashing a latent demand with more money and a new mindset.

The saying goes customer is king. Gone are the days of supernormal profits; gone are the days of monopoly in the 21-century, more and more companies have realized the

45

importance of acquiring and retaining customers. Companies have moved beyond customer satisfaction, customer delight is the new mantra.

The FMCG industry in India is characterized with low switching cost. Mostly it is an industry having low involvement buying, where the customer is ready to experiment with new brands. With more and more companies fighting for customer locality from the same customer group, constantly meeting and exceeding customer expectations is the key to success today.

Most of the FMCGs have a large network of warehouses/depots, distributors, retailers.

Also most of the retailing in India is through unorganized sector, with only about 4% of retailing through organized retail. This has resulted in complex distribution network for most of the FMCGs. Making the products available with all distributors and retailers in right numbers at the right time according to the demand is the biggest challenge for the FMCG sector.

46

COMPANY PROFILE HISTORY OF P&G William Procter, a candlemaker, and James Gamble, a soapmaker, formed the company known as Procter & Gamble in 1837. The two men, immigrants from England and Ireland respectively, who had settled earlier in Cincinnati might never have met had they not married sisters, Olivia and Elizabeth Norris.

Since both their industries used similar resources, the Panic of 1837 caused intense competition between the two and as a result it led to discord with the family. Alexander Norris, their father-in law decided to call a meeting where he convinced his new sons-inlaw to become business partners. On October 31, 1837, as a result of the suggestion, a new enterprise was born: Procter & Gamble.

The company prospered during the nineteenth century. In 1859, sales reached one million dollars. By this point, approximately eighty employees worked for Procter & Gamble.

During the American Civil War, the company won contracts to supply the Union Army with soap and candles. In addition to the increased profits experienced during the war, the military contracts introduced soldiers from all over the country to Procter & Gamble's products. Once the war was over and the men returned home, they continued to purchase the company's products.

In the 1880s, Procter & Gamble began to market a new product, an inexpensive soap that floats in water. The company called the soap Ivory. In the decades that followed, Procter & Gamble continued to grow and change. The company became known for its progressive work environment in the late nineteenth century. William Cooper Procter, William Procter's grandson, established a profit-sharing program for the company's workforce in 1887. He hoped that by giving the workers a stake in the company, they would be less inclined to go on strike.

Over time, the company began to focus most of its attention on soap, producing more than thirty different types by the 1890s. As electricity became more and more common,

47

there was less need for the candles that Procter & Gamble had made since its inception.

Ultimately, the company chose to stop manufacturing candles in 1920.

In the early twentieth century, Procter & Gamble continued to grow. The company began to build factories in other locations in the United States, because the demand for products had outgrown the capacity of the Cincinnati facilities. The company's leaders began to diversify its products as well and, in 1911, began producing Crisco, a shortening made of vegetable oils rather than animal fats. In the early 1900s, Procter & Gamble also became known for its research laboratories, where scientists worked to create new products. Company leadership also pioneered in the area of market research, investigating consumer needs and product appeal.

As radio became more popular in the 1920s and 1930s, the company sponsored a number of radio programs. As a result, these shows often became commonly known as "soap operas."

Throughout the twentieth century, Procter & Gamble continued to prosper. The company moved into other countries, both in terms of manufacturing and product sales, becoming an international corporation with its 1930 acquisition of the Newcastle upon Tyne-based Thomas Hedley Co. Procter & Gamble maintained a strong link to the North East of England after this acquisition. In addition, numerous new products and brand names were introduced over time, and Procter & Gamble began branching out into new areas.

The company introduced Tide laundry detergent in 1946 and "Prell" shampoo in 1950. In 1955, Procter & Gamble began selling the first toothpaste to contain fluoride, known as "Crest". Branching out once again in 1957, the company purchased Charmin Paper Mills and began manufacturing toilet paper and other paper products. Once again focusing on laundry, Procter & Gamble began making "Downy" fabric softener in 1960 and "Bounce" fabric softener sheets in 1972. One of the most revolutionary products to come out on the market was the company's "Pampers", first test-marketed in 1961.

48

Prior to this point disposable diapers were not popular, although Johnson & Johnson had developed a product called "Chux". Babies always wore cloth diapers, which were leaky and labor intensive to wash. Pampers simplified the diapering process.

Over the second half of the twentieth century, Procter & Gamble acquired a number of other companies that diversified its product line and increased profits significantly. These acquisitions included Folgers Coffee, Norwich Eaton Pharmaceuticals, RichardsonVicks, Noxell, Shulton's Old Spice, Max Factor, and the Iams Company, among others.

In 1994, the company made headlines for big losses resulting from leveraged positions in interest rate derivatives, and subsequently sued Bankers Trust for fraud; this placed their management in the unusual position of testifying in court that they had entered into transactions they were not capable of understanding.

In 1996, Procter & Gamble again made headlines when the Food and Drug Administration approved a new product developed by the company, Olestra. Also known by its brand name Olean, Olestra is a substitute for fat in cooking potato chips and other snacks. Procter & Gamble has expanded dramatically throughout its history, but its headquarters still remains in Cincinnati. {Source, Ohio History Central.} In January 2005 P&G announced an acquisition of Gillette, forming the largest consumer goods company and placing the Anglo-Dutch Unilever into second place. This added brands such as Gillette razors, Duracell, Braun, and Oral-B to their stable. The acquisition was approved by the European Union and the Federal Trade Commission, with conditions to a spinoff of certain overlapping brands. P&G has agreed to sell its SpinBrush battery-operated electric toothbrush business to Church & Dwight. It also plans to divest Gillette's oral-care product line, Rembrandt. The deodorant brands Right Guard, Soft & Dri, and Dry Idea were sold to Dial Corporation. The companies officially merged October 1, 2005.

P&G's dominance in many categories of consumer products makes its brand management decisions worthy of study. For example, P&G's corporate strategists must account for the likelihood of one of their products cannibalizing the sales of another

49

P&G Home Products Limited is one of India's fastest growing Fast Moving Consumer Goods Companies that has in its portfolio P&G's global brands such as Ariel and Tide in the Fabric Care segment, and in the Hair Care segment: Head & Shoulders - world's largest selling anti-dandruff shampoo; Pantene - world's No. 1 beauty shampoo; and Rejoice Asia's No. 1 shampoo.

P&G Home Products Limited is a 100% subsidiary of The Procter & Gamble Company, USA, that in India, has carved a reputation for delivering superior quality, value-added products to meet the needs of consumers.

P&G Hygiene and Health Care Limited is one of India's fastest growing Fast Moving Consumer Goods Companies that has in its portfolio P&G's billion dollar brands such as Vicks & Whisper. With a turnover of Rs. 500+ cores, the Company has carved a reputation for delivering high quality, value-added products to meet the needs of consumers.

P&G Hygiene and Health Care Limited takes pride in being voted India's Best Employer 2003 in a survey of 200 companies conducted by International HR Consultancy Hewitt Associates in association with Business Today magazine. Earlier, the Company was voted India's 2nd Best Employer in previous editions of the survey in 2001 and 2002.

Notably, there are over 200 Indian employees with P&G Subsidiaries abroad.

P&G and Gillette merge into one company and add five more Billion Dollar Brands to our product portfolio including Gillette and Braun's shaving and grooming products, the Oral-B dental care line and Duracell batteries.

BACKGROUND NOTE: The US based P&G is the no.1 maker and marketer of household products in the US and one of the largest FMCG companies in the World. It was established in 1837 when William Procter, a candle maker and his brother-in-law, James gamble a soap maker, merged their small businesses. They setup a shop in Cincinnati and nicknamed it ‘porkoplis’ because of its dependence on swine slaughterhouses. By 1859, P&G was

50

generating sales of Rs. 10mn. The company introduced Ivory a floating soap in 1879 and Crisco, the first all vegetable shortening in 1911.

Between 1940’s and 1960’s P&G embarked on a series of acquisition. The company acquired Spic & Span (1945), Duncan Hines (1956), Clorox (1957, sold in 1968) and Folgers coffee (1963). In 1985, P&G announced several major organizational changes relating to category management, purchasing, manufacturing, engineering and distribution.

After witnessing a period of significant organic and inorganic growth worldwide, P&G began to face several problems during the 1990’s. Its new products development activities seemed to have slowed down. Reportedly, its risk-averse culture seems to be stifling innovation and obstructing commercialization of new ideas quickly. During the late 1990’s P&G revenues were stagnant and its income was decreasing.

By mid 2003 the company was well on its way towards achieving these targets. It streamlined its businesses by broadly dividing them in to 5business segments- Fabric and homecare, Baby, Feminine, and family care, beauty care, health care and Food & beverages. These segments comprised of several product division that collectively sold more than 300 brands to nearly 5bn consumers in 160 countries across the globe. Some major P&G brands were Tide, Ariel, Pampers, Whisper, Pantene, Cheer, gain, head & shoulders, Clairol herbal essences, Ivory personal care, Crest, Vicks Vaporub, Actonel and Max Factor cosmetics.

For the financial years ending June 2003, P&G reported revenues of Rs. 86.76bn and net earnings of Rs. 10.36bn. In 2003 the company was ranked 31st among the fortune 500 companies. P&G had operation in 80 countries globally. With an employee strength of around 110,000 worldwide.

COMPANY PURPOSE: We will provide branded products and services of superior quality and value that improve the lives of the world's consumers. As a result, consumers will reward us with leadership

51

sales, profit, and value creation, allowing our people, our shareholders, and the communities in which we live and work to prosper.

COMPANY VALUES: P&G is its people and the values by which we live. We attract and recruit the finest people in the world. We build our organization from within, promoting and rewarding people without regard to any difference unrelated to performance. We act on the conviction that the men and women of Procter & Gamble will always be our most important asset.

INTEGRITY •

We always try to do the right thing.

•

We are honest and straightforward with each other.

•

We operate within the letter and spirit of the law.

•

We uphold the values and principles of P&G in every action and decision.

•

We are data based and intellectually honest in advocating proposals, including recognizing risks.

PASSION FOR WINNING •

We are determined to be the best at doing what matters most.

•

We have a healthy dissatisfaction with the status quo.

•

We have a compelling desire to improve and to win in the marketplace.

TRUST •

We respect our P&G colleagues, customers, and consumers, and treat them, as we want to be treated.

52

•

We have confidence in each other's capabilities and intentions.

•

We believe that people work best when there is a foundation of trust.

COMPANY PRINCIPLES a) We Show Respect for All Individuals •

We believe that all individuals can and want to contribute to their fullest potential.

•

We value differences.

•

We inspire and enable people to achieve high expectations, standards, and challenging goals.

•

We are honest with people about their performance.

b) The Interests of the Company and the Individual Are Inseparable •

We believe that doing what is right for the business with integrity will lead to mutual success for both the Company and the individual. Our quest for mutual success ties us together.

•

We encourage stock ownership and ownership behavior.

c) We Are Strategically Focused in Our Work •

We operate against clearly articulated and aligned objectives and strategies.

•

We only do work and only ask for work that adds value to the business.

•

We simplify, standardize, and streamline our current work whenever possible.

d) We Value Personal Mastery •

We believe it is the responsibility of all individuals to continually develop themselves and others.

53

•

We encourage and expect outstanding technical mastery and exceptional excellence.

e) We Seek to Be the Best •

We strive to be the best in all areas of strategic importance to the Company.

•

We benchmark our performance rigorously versus the very best internally and externally.

•

We learn from both our successes and our failures.

f) Innovation Is the Cornerstone of Our Success •

We place great value on big, new consumer innovations.

•

We challenge convention and reinvent the way we do business to better win in the marketplace.

DISTRIBUTION CHANNEL OF COMPANY: Material is procured by C.G. marketing from P&G Mumbai. Then it is distributed to the wholesaler, retailer, & distributor.

Procedure of distribution 1. Sales executive from C. G. Marketing visit to various wholesaler, and retailer 2. Then stock check by him 3. Then he take the order from shop and also suggest to add the new goods of P&G 4. Then he put forward orders to C. G. Marketing office 5. The material is outward from C.G. Marketing office to various shop from were the order is taken.

54

PRODUCT RANGE Fabric Care Procter & Gamble has two of its world-leading detergents – Tide and Ariel, in India to cater to the main concerns of the Indian households, namely, outstanding whiteness and stain-removal.

Ariel Front-O-Mat Ariel 2 Fragrances Tide Detergent Tide Bar ARIEL 2 FRAGRANCES:-

In 1991, Procter & Gamble India launches Ariel detergent - another of P&G's global, breakthrough technology products. Also, in the same year the Mandideep (Bhopal) Factory starts its operations. Ariel is the world’s leading detergent and epitomizes ‘stain removal’.

55

Core Target Audience Females seeking superior end result from their cleaning Core Equity Best possible cleaning as shown by stain removal Key Features & Benefits •

Provides superior cleaning, removing stains in the 1st wash.

•

Revolutionary new technology ‘ZPB’ helps remove clay stains better

•

Ideal for hand wash and top loading machines.

•

Available in 2 scents to appeal more consumers.

SKU Lineup SKU

20gm

200gm

500gm

1kg

1.5kg

MRP (Rs.)

2

26

55

107

158

ARIEL FRONT-O-MAT:-

56

Ariel Front-o-Mat is introduced in India exclusively for front load washing machines.

The unique tumble wash technology of front-loading machines needs a special chemistry, which Ariel Front-o-Mat provides. Using Ariel Front-o-Mat completely eliminates the need to bucket soak and a scrub.

Core Target Audience Females seeking superior end result from their cleaning in front-loading washing machines Core Equity Best possible cleaning as shown by stain removal Key Features & Benefits •

Low suds. Ideal for front-loading machines, which need a special detergent chemistry due to their tumble wash technology.

•

Using Ariel Front-O-Mat completely eliminates the need to bucket soak and scrub.

SKU Lineup SKU

1kg

MRP (Rs.)

155

TIDE

57

Launched in India in mid-2000, Tide provides ‘Outstanding Whiteness’ on white clothes & excellent cleaning on colored clothes as well. This is possible, due to its ‘antiredisposition’ global technology, which Tide employs.

Core Target Audience Females wanting to keep their family’s clothes absolutely clean Core Equity Superior whiteness for everyday family clothes Key Features & Benefits •

World’s first and most trusted detergent.

•

Tide provides superior whiteness for everyday clothes.

•

Brightens colored clothes due to the ‘Anti-Redeposition’ global technology, which prevents dirt from re-settling on the fabric during the wash itself.

SKU Lineup SKU

20gm

200gm

500gm

1kg

2kg

4kg

MRP (Rs.)

2

11

26

51

102

204

Hair care P&G’s Beauty Business is over US$ 10 Billion in Global Sales, making it one of the world’s largest beauty companies. The P&G beauty business sells more than 50 different beauty brands including Pantene, Olay, SK-II, Max Factor, Cover Girl, Joy, Hugo Boss, Herbal Essences and Clairol Nice ’n’ Easy. In India, P&G’s beauty care business comprises of Pantene, the world’s largest selling shampoo, Head & Shoulders, the world’s No. 1 Anti-dandruff shampoo and Rejoice – Asia’sNo.1Shampoo.

58

Procter & Gamble is committed to making every day in the lives of its consumers better through the superior quality of its products and services.

•

Pantene Pro V

•

Head & Shoulders

•

Rejoice

•

PANTENE PRO V

Core Target Audience Female, 18-34 years old Core Equity Beauty via superior hair health transformation Key Features & Benefits •

Amino Pro-V Complex that makes hair 10 times stronger.

•

Gentle enough for daily use, even on premed or color-treated hair.

Variants •

Smooth & Silky for Straighter hair. High conditioner level for healthy, straight looking hair with a vibrant shine.

59

•

Volume & Fullness for Thicker hair. High conditioner level for a healthier, fuller and bouncier feel to the hair.

•

Lively Clean for Livelier hair. Low conditioner level that converts weighted down and oily hair to clean, fresh and healthy hair that remain free-flowing throughout the day.

•

Long Black for the Long & Black hair look. High conditioner level. Darkens each strand of hair uniformly from root to tip and enables women to keep their hair long.

•

Hair Fall Control for reducing hair fall by 50% in just 2 months. High conditioner level.

SKU Lineup Variant

7.5ml

100ml

200ml

400ml

Smooth & Silky

3

54

99

164

Hair Fall Control

3

54

99

164

Lively Clean

3

-

99

-

Long Black

3

54

99

-

Anti Dandruff

3

54

99

-

HEAD & SHOULDERS

60

Core Target Audience Male/Female, 18-34 years Core Equity Superior Anti-Dandruff efficacy and superbly attractive hair Key Features and Benefits: •

Anti-Dandruff shampoo with ZPT & conditioner.

•

Removes flakes itchiness, irritation, dry Scalp & Oiliness- the five signs of Dandruff.

Variants: •

Smooth & Silky for Straighter hair: High conditioner level. Relieves hair dryness to make the hair silky smooth.

•

Silky Black: High conditioner level. Has black sesame and walnut extracts that nourish hair and scalp to make black hair look silky.

•

Clean & Balanced: Medium conditioner level. Has a cleansing system that gives your hair a wonderfully clean look and feel.

SKU Line-up Variant

7.5ml

100ml

200ml

400ml

61

Smooth & Silky

3

64

122

215

Clean & Balanced

3

64

122

-

Aloe Vera

3

64

122

-

Silky Black

3

64

122

-

Refreshing Menthol

3

64

122

-

Natural Shine

3

64

122

-

Health Care VICKS Vicks is India’s No.1 Cough & Cold Brand. It created the cold & cough Over-theCounter (OTC) category in India way back in 1952 and has led the category till date.

Today it has completed more than 50 years in India. Its current portfolio in India comprises Vicks Action500+, Vicks VapoRub, Vicks Cough Drops, Vicks Formula 44 Cough Syrup and Vicks Inhaler. It was rated as ‘India’s Most Trusted Brand’ by the ‘Advertising & Marketing’ Magazine and continues to be on top of the charts of BrandEquity surveys till date.

The Vicks business in India is the biggest in the ASEAN-Australasia-India (AAI) region.

Over the years, Vicks has launched several heart-tugging advertising campaigns, some of which were – the ‘Happy Birthday Mummy’ and ‘Touch Therapy’ campaigns for Vicks VapoRub, the ‘Khich Khich Dooor Karo’ ad for Vicks Cough Drops, the ‘Haan Bhai Haan’ ad for Vicks Action 500.

•

Vicks VapoRub

•

Vicks Inhaler

•

Vicks Formula 44

62

•

Vicks Cough Drops

•

Vicks Action 500+

VICKS VAPORUB:-

Core Target Audience: Mothers with Children between 3-8 seeking comforting cold relief.

Core Equity: Fast acting relief from the 6 symptoms of cold.

Key Features and Benefits: •

Finds a place in every Indian home, due to its proven performance against cold over decades.

•

Works on the 6 symptoms of cold blocked nose, breathing difficulty, cough, body ache, congestion and headache.

•

Ayurvedic and safe for regular use. Contains Kapoor (Camphor), Pudinah ke Phool (Menthol), Nilgiri Tel (Eucalyptus Oil).

•

Applied externally, so it is safer than pills and also doesn’t interact with other medication.

Grooming & Personal Care

63

Gillette M3Power The Gillette M3Power razor is the first battery-powered shaving system from Gillette

Gillette Mach3 and Mach3 Turbo Gillette's best manual razor for a close shave, with less irritation - Even when shaving against the grain Gillette M3 Power and M3 Power Nitro The Gillette M3Power razor is the first battery-powered shaving system from Gillette.

After Shave Lotion Combines the refreshment of a lotion with the masculine invigorating fragrance of Old Spice Pre-electric Shave Lotion For a smoother, more comfortable shave, apply to the face prior to an electric shave.

Gillette Fusion Pre and Post Shave A range of shaving gels and foam plus a post-shave Hydra Soothe Balm and Hydra Cool Gel to calm your just-shaved skin Gillette Fusion Manual and Fusion Power •

Gillette's Best Shave in Manual and Battery Power.

64

•

The following products made by Gillette/Procter & Gamble contain PVC plastic in the packaging:

•

Fusion Razor (20001906)

•

Mach3 Razor

•

Turbo Razor

•

Fusion Razor

•

Venus Vibrance Razor

•

Gillette For women - Venus razor blade

•

Gillette M3 Power razor blade

•

Gillette Sensor 3 for women razor blade

•

Gillette Venus divine razor blade

•

Gillette m3 power nitro razor

COMPANY SWOT ANALYSIS Strengths

Weaknesses

Market Leader

Long Development Cycles

Strong Brand Image

Relatively Static Market Growth

Global Presence

Heavy Dependence on High

Aggressive Advertising

Street Retail Outlets

Quality & Innovation

Expensive Brand Maintenance

65

Portfolio Range (Mach 3 etc)

Demographic Changes

New Competitors

Changing Societal Attitudes

Cloning of Successful brands

Consumer Brand Preference

Increasing Buyer Power

Demand for High Quality

(Inventory De-stocking)

Use of JIT and ICT (e-com)

Growth in Substitutes

New Production Technology

Own Label Fits

Increased Grooming Sophistication

Economic Downturn

STRENGTH Gillette Clinical Strength is specially formulated to provide effective protection for the heaviest of sweaters and men who worry about excessive underarm perspiration. The Triple-Protection Technology provides three unique layers of protection, including clinically proven prescription-strength wetness protection, odor-fighting microcapsules to absorb odor and release a fresh, clean scent throughout the day and skin-conditioning ingredients to minimize irritation. Gillette Clinical Strength contains the highest level of active ingredient allowed without a prescription. It is less acidic than aluminum chloride (used in many prescription antiperspirants) and thus, helps significantly reduce the

66

potential for skin irritation. In fact, in clinical studies, Gillette Clinical Strength was significantly less irritating than a prescription product containing aluminum chloride.

•

Vibrating razor with an extremely close shave

•

smooth shave

•

5 blades taking off facial hair means less skin that can get in between the blades

•

Close shave, durability.

-Strong and well differentiated brands with leading share positions.

-Brand portfolio includes both global Unilever brands and local brands of specific relevance to India.

-Consumer understanding and systems for building consumer insight.

-Strong R&D capability, well linked with business.

-Integrated supply chain and well spread manufacturing units.

-Distribution structure with wide reach, high quality coverage and ability to leverage scale.

-Ability to deliver Cost Savings.

-Access to Unilever global technology capability and sharing of best practices from other Unilever companies.

-High quality manpower resources.

WEAKNESSES Complex supply chain configuration, very large numbers of SKU's with dispersed manufacturing locations.Price positioning in some categories allows for low price

67

competition. High Social costs (housing, foodgrains & firewood, health and other welfare measures) in the plantation business.

OPPURTUNITIES : •

-Brand growth through increased consumption depth and frequency of usage across all categories.

•

-Market and brand growth through increased penetration especially in rural areas.

•

-Upgrading consumers through innovation to new levels of quality and performance. Emerging Modern Trade for introduction of more up market Personal Care products. Growing consumption in Out of Home categories.

•

-Establishing HLL as a sourcing hub for Unilever companies in various countries.

•

Leveraging the latest IT technology.

THREATS Increased consumer spends on education, consumer durable, entertainment, travel etc. resulting in lower share of wallet for FMCG. Aggressive price competition from local and multinational players. Grey imports. Spurious/counterfeit products in rural areas and small towns. Changes in fiscal benefits. Unfavourable raw material prices in oils, tea commodity etc.

•

BLADES & RAZORS STRATEGY

Innovation through Research & Development •

Premium Brand - Premium Price

•

Build Global Product Branding 68

•

Build Strong Brand Loyalty

•

Greater Efficiency at Lower Cost.

•

Maintain Superior Growth in Market Share

•

Build Shaving Systems Sub-Segment

•

Invest in technology and product innovation

FUTURE GILLETTE STRATEGIES •

High Branding/Quality - Premium Price

•

Develop New Market Segments & Niches through R&D

•

Maintain/Promote Strong Brand Loyalty

•

Tailoring Demographic Targeting (E.g. US vs Europe)

•

Reduction in Product Unit Costs

•

Grow Razor Systems Segment

•

Strategic Alliances (Suppliers and Distributors)

•

Shedding Non-Core Businesses (E.g. Papermate)

CUSTOMER RELATIONSHIP MARKET MIX 69

The following contains the four elements of the marketing mix for the new Gillette Venus.

Product Strategy Gillette marketing mix depends mainly on the product and the product marketing, but we are also leveraging a lot more in the packaging. Innovation is the key to our growth and the opportunity for continual growth. Gillette product marketing has to emphasize the benefits of unique combination of technological expertise and new innovation. Gillette need to sell a sense of quality and comfort that will show in packaging. This particular product outdoes all other female razor products as far as comfort is concerned. The following are a few of the unique features that the Gillette Venus has to offer: -Unique comfort strips to provide protection against razor burn. The shave bars flex around for more detail, fitting into more difficult areas, such as knees and ankles.

From Boston to Bangkok, Johannesburg to Mexico City to Berlin, the modern traveler encounters a Gillette product portfolio far broader, and a worldwide presence far stronger, than any envisioned by the Company's founder. The Gillette Company today is the global market leader in nearly a dozen major consumer products categories, principally

in

the

grooming,

alkaline

battery

and

oral

care

businesses.

In the more than 100 years since the Company was founded, Gillette has gained, held and strengthened leadership positions through the Company's strategy of managing its business with a long-term, global perspective. This demonstrated ability to generate longterm, profitable growth in a changing global marketplace rests on several fundamental strengths. These include a constantly increasing accumulation of scientific knowledge in core businesses, innovative products that embody meaningful technological advances and an immense manufacturing capability that produces billions of flawless.

RESEARCH METHODOLOGY OBJECTIVES OF THE PROJECT

70

In Today’s competitive market, every company wants to know the reasons how one can have the potential market, which factors enhance the sales of the FMCG product. The said information will be much useful for devising sales promotion. This research is also devoted regarding sales promotion for increasing sales of the P&G Company. The present study is conducted entitled “CRM ACTIVITY: A CASE STUDY OF GILLETTE BRAND OF P&G” The research objectives to be studied in this research are as follows: 1. To study the present distribution channel of the P&G product in Delhi.

2. To study the concept of CRM. 3. To study the impact of this CRM on sales of retailers & wholesalers.

4. To study the awareness about the CRM. RATIONALE FOR THE PROJECT An evaluation of current and future trends in crm, offering critical success factors for creating and implementing customer focused strategies. To assess the potential returns available from crm- investigates the tactics used to counter barriers to successful implementation. To evaluate the competitive technology vendor landscape that recommends best practice crm strategy and investment.

The main objective is to have a core insight to the pre and post changes in crm implementation and problems faced during the course of implementation. It also comprises of study about the process of crm activities.

LIMITATIONS OF THE PRESENT STUDY The present has following limitations.

71

1. It was somewhat difficult to get the questioner completely filled by the respondent as most of the times they were busy and could not give sufficient answer and sufficient information even though they have it and the information from respondents are very important for the research.

2. Some of the respondents were that not much serious about filling the questioner.

3. Some of the respondents left some questions unanswered and as such it was little difficult to draw and generalize the conclusion from them.

4. Some of them want to hide the fact so they did not respond and participated in the survey wholeheartedly.

5. The findings entirely depend upon the willingness & mental condition of the respondents.

Some respondents were unable to understand the question due to various problems like language barrier MATERIALS AND METHODS Research design is the plan structure and strategy of investigation conceived so as to obtain answers to research question and to control variance. It is the blue print for the collection, measurement of data .It aids the scientist in the allocation of his limited resources by posing crucial choices – is the blue print to include experiments interviews observations, the analysis of records, stimulation in or some combination of these? Are the method of data collection and the research situation to be highly structured?

A research design is simply the framework or plan for a study used as a guide in collecting and analyzing data. It is the blue print that followed in completing a study .It resembles the architects blue print for a house. These results are interesting but they do not solve the basic problem is a common latent. Thus a research design ensures that study 1. Will be relevant to the problem.

72

2. Will use economical problem.

As the outset may be noted that there are several ways of studying and tackling a problem there is no single perfect design. As such, the researcher should not wait until he arrives at a unique and perfect research design. Various authors have classified research designs in different ways. Different types of research design have emerged on account of the different perspective from which a research study can be viewed. However, a frequently used classification system is to group research designs under three broad categories – Exploratory, Descriptive and Causal.

TYPES OF RESEARCH DESIGN 1) Exploratory Research: Research design the major emphasis is on gaining ideas and insights. It is particularly helpful in breaking broad, vague problem statements into smaller, more precise sub problem statement.

2) Descriptive Research: Descriptive studies are undertaken in many circumstances. When the researcher is interested in knowing the characteristics of certain group such as age, sex, occupation, education level, or income, a descriptive study may be necessary.

3) Causal Research: As the name implies a causal design investigate the cause and effect relationship between two or more variables The type of research, which has been chosen for the present study, is exploratory research.

DATA COLLECTION Primary Data: -

73

Primary data is collected through survey method. Survey method involves collecting data by administrating a structure or non-structure questioners. The questionnaires were prepared using very simple and non-technical words. To serve the wholehearted cooperation without wasting more time of respondents, the questionnaire was short and to the point. To collect the relevant data for a research data will be collected in the form of questionnaire designing. Designing the questionnaire is not easy job it will be formulated in carefully means which type of information to be collected, type of questions, question wording, sequencing and layout and presenting these all of things are designing in well manner The questionnaire design procedure follows following steps. The said questionnaire is attached in the appendix section.

Specify what information will be sought

Determine wording of each question

Determine type of the questionnaire and method of administration

Determine forms & response to each question

Determine consent of individual question

Determine sequence of each question

Determine physical characteristics of questionnaire

Prepared for final data collection

Re-examine step 1-7 by testing questionnaire

Fig: Questionnaire Design Steps Secondary Data: -

74

Secondary data is required for collecting the information of the company the related information of the FMCG product. This data is collected from the related company website, magazines, journal and Textbook.

SAMPLE SIZE AND SELECTION PROCESS Once the researcher has clearly specified the problem and developed an appropriate research design and data collection instrument, the next step in research process is to select those element from which sample will be drawn.

The sample selection process requires the form of sample be specified. For this purpose, researcher has subjectively decided which particular group will be part of the study.

In a sample survey a small part of the entire population is subjected to the research. This sample is considered to be the true representative of the entire universe and decided upon certain criteria.

The sample size has been kept to 50 as it was considered large enough to reliable result.

After the sample size is decided, the next step was to meet the respondent personally and to collect data from them through personal interviews.

After conducting the personal interview of the respondents the next step was to arrange the collected data finally coded and tabulated to obtain the results. The present study used MS Excel package for the purpose of tabulation, which allows all kind of elementary statistical calculation. After tabulation the data was ready for calculations to draw necessary inferences.

75

FINDING AND ANALYSIS 1

Had you heard about company Gillette from P&G? Awareness about the Gillette Yes

74

No

26

Awareness about the Gillette

No 26%

Yes 74%

Gillette India has a very old presence in world wide while judging this statement we did brief survey of 100 People and according to our out put the data 74% people are actually aware about the Gillette as a brand name and the Gillette . While still 26% people still not aware about the Gillette Gillette need to focus to target 26% those people who doesn’t know about the Gillette .

Customer satisfaction and loyalty would come if the customer aware about the Gillette ’s so effectively only 74% customer who knew very well what Gillette doing in the Indian market and what available is for the customer.

If Yes 76

2

How you came to know about this company?

Awareness about the Gillette

Newspaper

40

By Friend

17

Means of Advertisement

62

Self Research

42

Hoarding

52

Retailers

10 Awareness about the Gillete

Hoarding 23%

Retailers 4%

Self Research 19%

Newspaper 18%

By Friend 8% Means of Advertisement 28%

How people got to know about the Gillette , there is various ways. Once customer know about the company brand so for Gillette in my project effective people for the survey is 223 because they know about the Gillette ’s brand name. people got to know about the Gillette from various parameter, like 23% people got to know about the Gillette through Hoarding while 28% people got to know from the advertisement that is doing by the company while 19 % people knew Gillette ’s brand through the self research and news paper is only effective by the 18%. Recommendation to increase awareness among the customer for Gillette can be focused more to hoarding advertisement rather than the news paper also self research contributed maximum so Gillette brand awareness so Gillette increase to advertise on internet, book etc.

77

3

How would you rate s of company?

Customer satisfaction from Excellent

34

Very Good

76

Good

85

Poor

28

Customer satisfaction from product

Poor Excellent 15% 13%

Good 38%

Very Good 34%

Out of 100 valuable customer for our survey it seems that 15% rated Gillette ’s as excellent in quality while 34% rated as very good experience that they have while using Gillette ’s and 38% people are rated as good to using Gillette ’s .

Recommendation about the Gillette would be 13% people rated Gillette as poor one so company need to focus on those area why people rate as a poor why they perceive that Gillette ’s quality is poor.

4

How would you rate services of the company?

78

Customer satisfaction from Services Excellent

50

Very Good

67

Good

57

Poor

49

Customer satisfaction from Services

Poor 22%

Good 26%

Excellent 22%

Very Good 30%

Recent survey conducted by the Business standard and it shows customer satisfaction also depends upon what is you sales after service strategy, according to our survey about the Gillette 22% people rated Gillette as a excellent service provider while 30% rated it has very good sales after service support and 26% rated good for the service to Gillette ’s.

The concern area for Gillette is 22% people who rated Gillette service as a poor one and not which is one of the area where customer are not satisfied so for the Gillette it need to be justify and fill the gap as soon as possible.

5

What is your overall opinion about the service provided?

79

According to our survey result overall customer satisfaction level from the various service like warranty, customer care, etiquette of the employee people are saying it is good company with providing day by day better service.

Some people says Gillette as a organization not having flexible service to the customer like 24*7 wise also some time they are arrogant to the customer.

6

Did you have any suggestions to improve the services?

Few Suggestions is  24*7 customer support  All India one warranty card  Better replacement if is not good.  Phone of live facility to take a brief about

7

What problem did you face while getting s serviced?  Employees are at times not having manner to talk  Fault occurrence after get repaired the

8.

Did you find the s up to the standard or Marks as specified before purchase?

80

Standard Yes

201

No

22

Product Standard

No 10%

Yes 90%

Before purchase customer are very cautious about the quality and it’s standard in the case of Gillette about 90% people are happy with the kind of quality that they would received before purchasing the Gillette . While only 10% people are not satisfied the quality of Gillette .

9.

Are you using other company are (Same type of s) simultaneously?

Comparison with Yes

218 81

No

5

Comparison with Product

No 2%

Yes 98%

Using Gillette with the other company which gives insight to know more about the competition level for the Gillette now we got very surprisingly result 98% people says yes while using Gillette they also using some other company . So kind of competition we can feel that Gillette has. Only 2% people using Gillette. Which quite less than the other favorable out put

82

10

Would you recommend company’s s to others?

Recommendation to other Yes

219

No

4

Recommendation to other

No 2%

Yes 98%

Recommendation to other means customer buy the due to influenced by the others also which shows very beneficial for the company. 98% people who is using Gillette is ready to recommend others to use Gillette which is very positive sign for the customer. Now move to other strata 2% only those people who doesn’t want to recommend Gillette to others

83

CONCLUSION Before we begin to examine the conceptual foundations of CRM, it will be useful to define what is CRM. A narrow perspective of customer relationship management is database marketing emphasizing the promotional aspects of marketing linked to database efforts.

Another narrow, yet relevant, viewpoint is to consider CRM only as customer retention in which a variety of aftermarketing tactics is used for customer bonding or staying in touch after the sale is made.

Shani and Chalasani define relationship marketing as “an integrated effort to identify, maintain, and build up a network with individuals consumers and to continuously strengthen the network for mutual benefit of both sides, through interactive, individualized and value-added contacts over a period of time”.

The core theme of all CRM and relationship marketing perspectives is its focus on cooperative and collaborative relationships between the firm and its customers, and/or other marketing actors.

CRM is based on the premise that, by having a better understanding of the customers’ needs and desires we can keep them longer and sell more to them.

Growth Strategies International (GSI) performed a statistical analysis of Customer satisfaction data encompassing the findings of over 20,000 customer surveys conducted in 40 countries by Infoquest.

The conclusions of the study were: • A Totally Satisfied Customer contributes 2.6 times as much revenue to a company as a Somewhat Satisfied Customer.

• A Totally Satisfied Customer contributes 17 times as much revenue as a Somewhat Dissatisfied Customer.

84

• A Totally Dissatisfied customer decreases revenue at a rate equal to 1.8 times what a Totally Satisfied Customer contributes to a business.

• By reducing customer defection (by as little as 5%) will result in increase in profits by 25% to 85% depending from industry to industry.

An important facet of CRM is “customer selectivity”. As several research studies have shown not all customers are equally profitable (Infact in some cases 80% of the sales come through 20% of the customers). The company must therefore be selective and tailor its program and marketing efforts by segmenting and selecting appropriate customers for individual marketing programs. In some cases, it could even lead to “ outsourcing of some customers” so that a company better utilize its resources on those customers it can serve better and create mutual value. However, the objective of a company is not to really prune its customer base but to identify appropriate customer programs and methods that would be profitable and create value for the firm and the customer. Hence, CRM is defined as:

85

RECOMMENDATIONS

Some of the Recommendation for Gillette that I analyze after making my project report is following below.  Out of our 100 sample size 26% people still not aware about the Gillette product so Gillette need to focus on more product awareness because it is the first and foremost thing for any organization  Recommendation to increase awareness of customer for Gillette company my be focused more to hoarding advertisement rather than the news paper also self research contributed maximum awareness to the Gillette brand so Gillette increase to advertise on internet, book etc.  Recommendation about the Gillette would be 13% people rated Gillette product as poor company need to focus on those area why people rate as a poor why they perceive that Gillette product’s quality is poor.  The concern area for Gillette is 22% people who rated Gillette service as a poor which is one of the area where customer are not satisfied so for the Gillette it need to be justify and fill the gap as soon as possible.

86

FUTURE PROSPECTS From the data interpretation and conclusion there are some suggestion, which can help company to build up strong position in market and to increase the sale of products.

•

As, it is to be known that advertisement and promotional activities plays a vital role in influencing the purchasing decision of the product so P&G should invest on advertisement.

•

P&G should more concentrate on facility like on time visit, replacement.

•

The company should promote the Golden Store Scheme to all categories of shops.

•

The company should keep watch of the competitors schemes.

87

BIBLIOGRAPHY 1. C.R. Kothari, “ Research Methodology”, second edition, Wishwa Prakashan a Division of Wiely Eastern Limited Pune, new Delhi-110001.

2. Philip Kotler and kenin Lane Keller, “ Marketing Management” Twelfth edition Prentice Hall Of India PVT. LTD New Delhi.-110001.

3. http://www.p&g.com 4. http://wikipedia.org/wiki/pune 5. http://www.google.com 6. HARISH KUMAR(sales manager,p&g)

88

QUESTIONNAIRE 1

Had you heard about company Gillette from P&G? (a) Yes

(b) No

If Yes 2

How you came to know about this company? (a) By Newspaper

(b) By Friend

(c) Other Means of Advertisement. (d) Others (Specify) _________________ 3

4

5

How would you rate company? (a) Excellent

(b) Very Good

(c) Good

(d) Poor

How would you rate services of the company? (a) Excellent

(b) Very Good

(c) Good

(d) Poor

What is your overall opinion about the service provided?

__________________________________________________________________ __________________________________________________________________ 6.

Did you have any suggestions to improve the services?

__________________________________________________________________ __________________________________________________________________ 7.

What problem did you face while getting p&g serviced?

__________________________________________________________________ __________________________________________________________________

89

8.

Did you find the products of p&g up to the standard or Marks as specified before

purchase? (a) Yes

9.

(b) No (Specify)___________________

Would you recommend company’s s to others? (a) Yes

(b) No

90