Product: Packaging innovations
Nihar, India’s only double filtered coconut oil has made a change in packaging and logo, which is innovative, convenient and vibrant. The logo lettering is now in a fresh green colour and sports a leaf over the brand name. Nihar has consistently been bringing innovations to its consumers, it was the first to introduce the wide mouth jar and pouches packaging.
In keeping with Nihar heritage, the new packaging is part of Nihar’s constant endeavors on improvising and providing quality to our consumers. The tamper proof jar has been introduced with grooves on the side for a firmer grip giving the jar a more feminine aspect. The flip top tin has been designed for convinience in pouring out the oil, the wide mouth jar can be used in different climatic conditions. The essence of the new packaging is to bring about practicality in daily usage of the Nihar coconut oil.
The range of double filtered Nihar coconut oil includes:
· Flip top tin, available in 200 ml and 500 ml
· Tamper proof cap, available in 100ml, 200ml, & 500 ml with grooves on the side for an easy hold when oily.
· Wide mouth jar available in 200 ml and 500 ml
· Pouches available in 50 ml, 100ml and 200 ml
Process of preparing the Double filtered Nihar coconut oil
The double Filtration process involves the production of filtered coconut oil from copra. This is done by downsizing the copra, which is then passed through a cooker and steam heated for facilitating oil release. The copra is then crushed at a higher pressure. The final step in this stage involves sieving the oil and parts of the crushed copra through a screen. This still murky oil is allowed to partially settle in flat-bottomed collection tanks. In the second stage the filtered coconut oil is mixed with special quality silica and recirculated, this continues until the required clarity is achieved. This filtered oil with adequate purity finally goes to the packaging line.
Nihar has also migrated to low unit packs to rope in new users. HLL has launched 100 ml pouches of Nihar priced at less than Rs 10.
Apart from making the product more affordable to mass market consumers, the 100 ml pouches are cheaper on a per ml basis than the larger bottles and flip top packs. This is likely to bring in new users from the loose oil segment.
So as to tackle the pricing issue, HLL has launched Nihar and Cococare in various price points in pouches, such as Rs 5.50 for 50 ml, Rs 10 for 100 ml and Rs 20 for 200 ml.
HLL believes that the low-unit price packs will result in upgradation of the loose oil consumer to this brand, and enable the company to gain a higher share of the market.
For example, Nihar’s small packs in AP has led to the brand’s market share gain in this state from a marginal 2% in April to 35 %.This example is being replicated by the company in each of the states where Nihar and Cococare draw large consumption. The company feels there is enough room for brands to gain share by upgrading loose oils users.
The price of copra, the key input in coconut based hair oils, has been a key factor determining the fortunes of the major players in this segment. The continuation of the present price trends in copra would probably determine the near term financial performance of the large players in the plain hair oils business. On this count, there appears to be no near term cause for worry. A large part of the decline in copra prices is due to the substitution of copra by cheaper imported palmolein.
Even after three successive import duty hikes on palmolein, it continues to the remain the cheaper option for industrial users. Prospects of a near-term up trend in coconut oil prices therefore appear remote. With an aggressive price war breaking out between the players in the coconut oil segment, value growth in this segment is likely to remain subdued. Strategies in this segment will clearly hinge on price. The value-added segment appears likely to sustain the present growth rates of 20-30 per cent.
Place ( Distribution)
Hindustan Lever Limited has a very good distribution network. Hindustan Lever has leveraged the micro-credit model to expand its rural market from its present 40 per cent penetration.
Hindustan Lever Ltd is picking up where the Grameen Bank of Bangladesh left off. Leveraging the micro-credit model to expand its rural market, it is piloting `Project Shakti’ — its five-month-old marketing initiative involving women belonging to micro-credit self-help groups (SHGs) in the Nalgonda district of Andhra Pradesh.
The project, with an obvious `win-win’ partnership potential, involves women from SHGs turning into direct-to-home distributors for HLL in their area, thus helping the company expand its rural market from its existing 40 per cent penetration in villages with population of over 2000.
For the women, it means income generation without the headache of starting their own venture and becoming vegetable vendors, fish vendors, pan shop owners, etc., which has generally been the micro-credit model to date.
Andhra Pradesh was obviously chosen for the pilot project as 20 per cent of its rural population is covered by the micro-credit model. The micro-credit concept, that impacts 45 lakhs women belonging to 3.33 SHGs in the State, creates wealth for the members of the groups and helps them better their lives and alleviate poverty. The micro-finance collected in the State, through savings as well as institutional loans, is around a whopping Rs 800 crore.
For the project, 50 SHGs closest to the highway in Nalgonda district were identified. These are covered by three Mutually-Aided Credit Thrift Societies (MACTS), which act as semi-distributors in the project. MACTS, which generally consist of 14 to 15 SHGs, are federated into a co-operative and work in close tandem with the SHGs.
In fact, the project has had several interesting spin-offs. One of the MACTs distributing HLL products has started its own supermarket, while another is shortly purchasing a vehicle for its distribution network.
The investment opportunity is relatively risk-free and high on return. HLL is committed to providing the necessary training inputs to these groups on the basics of enterprise management which the groups can then use to enlarge their initiatives.
Nihar attracts a large consumer preference in Bihar, Uttar Pradesh, Madhya Pradesh, Rajasthan, Andhra Pradesh and Bengal. Promotional activities are region-specific and locally flavoured to suit the brand’s requirement in its area of strength.
The customers in the rural area are very price sensitive. Great emphasis is laid on the price factor and so they advertise keeping in mind the price. A lot of emphasis is given on the price and they also compare the product with the local brands and how it is superior in quality from the other available local brands.
Nihar does advertise in the rural area but they don’t use much of newspaper as there is a very high level of illiteracy in the rural area. They do use advertising through T.V. Nihar’s “kudrat ki shakti” ad clicked in the market place as it was distinctly different to the usual hair oil ads, HLL feels. But that is also not on a large scale as the T.V hasn’t yet reached the interiors of rural areas.