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HUL to take P&G’s ‘Olay’ head on

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Hindustan Unilever, India’s largest FMCG goods company, is moving beyond mass products as the company is planning to focus on the niche, a segment where rivals are getting increasingly competitive. HUL is set to take Procter & Gamble’s anti-ageing cream, Olay, head on by launching more than half-a-dozen premium products from its Ponds Gold Radiance portfolio.The premium range of Ponds, priced between Rs500 to Rs1000, will be the most expensive brand in HUL’s skin care portfolio till now. “HUL is trying to identify certain gaps in its portfolio where rivals are getting stronger. The company will check competition in segments, primarily in the premium space, where it has not been present till now,” Anand Mour, Vice President, Indiabulls Securities, was quoted as saying.

The change in HUL’s marketing strategy has reportedly been triggered by Olay’s spiralling market share. According to the latest data by AC Nielsen, “Ponds had a 16.5 percent share in September, while Garnier made strong inroads with a 18.9 percent share, Olay with a 36.7 percent share tops the anti-ageing category, which accounts for 10 percent of the total skin care market, but it is the fastest growing sub-segment.”

Harish Manwani, Chairman, HUL, while announcing the quarterly results, indicated that the company is looking at entering the premium market, especially in the personal care category.
While HUL is the market leader in the 3,500-crore skin care segment, controlling over half the market with popular mass brands, such as Fair & Lovely and Vaseline, it won’t be easy for the FMCG giant to pitch Ponds against L’Oreal and P&G, who have already become stronger in the anti-ageing market. The question is – how much can HUL stretch Ponds, a brand which has been associated with talcum powder and cold cream for so long in India?

Posted on: 3.11.2010

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