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P&G gives HLL a run for its money

20-April-2004
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P&G gives HLL a run for its money

Rejoice, the mid-priced international shampoo brand which was launched by Procter & Gamble (P&G) in January this year, has eaten into the market share of rival Hindustan Lever Ltd (HLL) to the extent of 1.2 per cent in three months.

With the new brand carving a niche for itself, the latest market share figures in the Rs 1,100 crore shampoo industry for February 2004 are as follows: Clinic Plus is at 23.4 per cent (24.7 per cent in February 2003), Clinic All Clear at 9.9 per cent, Sunsilk is at 13.7 per cent (15 per cent in February 2003), Head & Shoulders is at 9.5 per cent (7.8 per cent in February 2003) and Pantene is at 7.5 per cent (7.6 per cent in February 2003).

Prior to the launch of Rejoice, the share of Clinic Plus was 24.5 per cent in December 2003. Overall, HLL’s share is 51.1 per cent, while that of P&G is 18.2 per cent. HLL’s overall share has come down from 52.4 per cent in February 2003, while P&G’s share has risen as compared to 15.4 per cent in February 2003.

HLL has now reduced the price of Clinic Plus — which has been relaunched as Clinic Plus Health Shampoo with Milk Proteins — by 20 per cent. This puts Clinic Plus in a more competitive position as compared to Rejoice, even as P&G’s reaction to the price cut is awaited in the market place. Rejoice is priced at Rs 39 (100 ml).

The price of Clinic Plus has been reduced from Rs 37.50 (100 ml) to Rs 30, from Rs 70 (200 ml) to Rs 55 and from Rs 117 (300 ml) to Rs 90.

The company has finalised the new pricing based on the consumer response it received on its buy-one-get-one-free initiative on Clinic Plus and Sunsilk shampoo bottles. The scheme, which was announced on March 15, has now been discontinued.

Industry sources said that HLL is likely to unleash more marketing initiatives in shampoos in the next couple of weeks. This may include a price cut on Sunsilk.

An HLL release on the Clinic Plus relaunch stated that this was the first time such a five-in-one shampoo had been introduced in India.

Though a P&G spokesperson said that the company is not taking a price cut, industry observers felt that the company maybe forced to cut prices sooner or later.

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