market research on paint industry

42
Market Research Teacher-in-charge : Prof. Varalaxmi Presented by: Rahul Asher – Roll No. Kansai Nerolac

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Page 1: Market Research on Paint Industry

Market Research

Teacher-in-charge: Prof. Varalaxmi

Presented by:

Rahul Asher – Roll No.

Alafiya Attari – Roll No.

Kshama Chappkhanawalla – Roll No.

Rishabh Khicha – Roll No.34

Dikshita Shukla – Roll No.55

Kansai Nerolac

Page 2: Market Research on Paint Industry

Research Objective

The purpose of collecting the attached primary data has been to determine the capability

of the company to streamline its communications with its sole/multi-brand dealers and its

customers. Its ability to do so has been reflected in the congruence or lack of it in the

response gathered from each of the above mentioned parties and the company. Similarly,

we also intend to analyze the rapport and perception that the customer has formed with

sole/mutli-brand dealers.

Therefore the objective of the project is solely to measure the overall communication

process of the company, its representatives and the end consumer on several parameters.

Company Vision & Strategy

The company vision is very clearly spelt out to all its employees, however it has not have

been communicated to the surveyed dealers

“It is our vision to leverage global technology for serving our customers with superior

coating systems built on innovative and superior products & world class solutions to

strengthen our leadership in industrial coatings and propel leadership in architectural

coatings to delight all our stake holders”

- Kansai Nerolac Company Vision

From the feedback obtained from the company they are following an umbrella branding

strategy. As far as the interior decorative paints segment is concerned, they plan to target

various price-points by providing a wide basket of products in the same segment. This

can be illustrated from the range of products listed below:

PRODUCT RANGE

1. Water-based Paints

a. Emulsions

i. Nerolac Impressions – 24 carat

ii. Nerolac Impressions - Metallic

Page 3: Market Research on Paint Industry

iii. Nerolac Impressions - Disney

iv. Nerolac Beauty - Premium

v. Nerolac Beauty – Silky Smooth

vi. Nerolac Beauty – Beauty Finish

b. Distemper

i. Beauty Premium Acrylic Distemper

ii. Beauty Acrylic Distemper

iii. Beauty Oil Bound Distemper

2. Solvent-based Paints

a. Lustre

i. Nerolac Pearls Lustre Finish

b. Enamel

i. Nerolac Synthetic Enamel

ii. Nerolac Satin Enamel

iii. Impressions Hi- Performance

iv. Goody Synthetic Enamel

c. Flat Oil

i. Nerolac Synthetic Flat Oil Interior Paint

Page 4: Market Research on Paint Industry

Methodology

The questionnaires that have been drafted can be divided into 3 categories:

1. Corporate Questionnaire -1

It has been filled in by a group member on dictation by Mr.Virendra Gupta/Mr.Pinaki

Bannerjee over a personal interview.

2. Dealer Questionnaire

a. Exclusive Dealer – 2

Filled in by meeting dealer in person.

b. Multi-Dealer – 3

Filled in by meeting the dealer in person.

3. Customer Questionnaire - 73

a. Customers

b. Painters

c. Architects

A large number of category of persons have been contacted in-person and the

remaining have been contacted over the telephone to receive their response.

NOTE:

Highlighted boxes represents the response obtained from the

company/dealer/customer.

Surveys ranging from scale 1 to 7 can be interpreted as – 7 = Strongle Agree, 1 =

Strongly Disagree

All data used in the surveys may be have been rounded off for convenience

Arithemtic mean has been calculated in case of most surveys.

Page 5: Market Research on Paint Industry

Importance of Interior-Decorative Paints segment

50% of the total sales of the company can be attributed to this segment. Although, the

company is largely dependent on this segment for a major chunk of its sales it is still far

behind the leaders in terms of market share.

Product Differentiation

1. Service Offerings

Company Perspective

It is vital that the company increase its points of contact with the customer through value added services. Strongly StronglyDisagree Agree

1 2 3 4 5 6 7

Value-added services are the best way to differentiate the company product from that of its competitors.Strongly StronglyDisagree Agree

1 2 3 4 5 6 7

Kansai Nerolac has redesigned its website and is offering several online services to the

customer which can be listed as follows:

Color Therapy – It has been documented that colors have an impact on the way

the body and the mind tends to think and function. This helps the customer make

Page 6: Market Research on Paint Industry

decisions whether he would want a soothing green, stimulating yellow, energizing

orange or relaxing red.

Color your Home – Offers a 3-Dimensional room in which various color schemes

can be used to decorate and view the room virtually

Color Wheel – Providing 12 color scheme combinations whether you want them

the color scheme to be harmonious or contrasting

Vaastu Colors – Depending upon the direction of the wall and house certain

colors are prescribed, this service help take those considerations into account and

provide recommendations.

Color Personality – Involves matching ones personality with the colors in the

room

Kidz – Nerolac has tied up with Disney and offers various exclusive wallpapers

that they can offer of several cartoon characters which can be put onto the wall.

Cost Calculator – Depending upon the dimensions of the wall and the intended

paint which will be used this services provides the rough estimate of painting a

certain surface area.

Apart from provision of online services, they also have a helpline number where

customer care executives can be contacted. If requested will send an expert to provide on-

site assistance, review the area to be painted, provide their expert opinion and after

selection of color schemes and other minor details will provide painters to carry out the

job.

The primary reason for offering so many services on the company’s part is to get closer

to the consumer and provide him exhaustive solutions and alternatives for any painting-

related problems.

Dealer Perspective

Page 7: Market Research on Paint Industry

Company offered services are popular amongst customers and help increase sales.Strongly StronglyDisagree Agree

1 2 3 4 5 6 7

Customer Perspective

I would be inclined to purchase Nerolac if they offered more and improved services.Strongly StronglyDisagree Agree

1 2 3 4 5 6 7

Customers would readily accept and purchase certain brand of paint if additional services

are offered along with the product.

However, only 20% of the customers are aware of the services which

speaks poorly of the company communication.

Inference: The Company believes that offering services is the best way to differentiate

the company; such services are not popular amongst customers from the dealer’s point of

view. This is primarily due to lack of publicity and awareness being created regarding

such services. Therefore, the company must strengthen its communication to the end

consumer regarding the presence and utility of all its offered services.

2. Quality & Variety

Company Perspective

Page 8: Market Research on Paint Industry

The company also emphasizes on providing high-quality durable products. It also offers a

2-year warranty on a large number of its products. It strongly believes that product

quality is its USP and differentiates itself from its competitors in this segment.

As represented from the expansive product basket the company has in their opinion they

seem to be satisfying these needs of the customer

Dealer & Customer PerspectiveI/Customers are satisfied with the quality and variety of paint offered.Strongly StronglyDisagree Agree

1 2 3 4 5 6 7

0

1

2

3

4

5

6

7

Customer

Dealer

Customer 5.53 5.2

Dealer 5.75 6.5

Quality Variety

Inference: All in all, the customer and the dealers are relatively satisfied with the quality

and variety of products offered by the company. This indicates the company is well

aware of its strengths and is attempting to leverage them. There is a congruence in what

the company claims and what is eventually realized by the dealer and the customer.

3. Innovation

Company Perspective

Page 9: Market Research on Paint Industry

Kansai Nerolac invests heavily in research and development to constantly review and

improve on existing products to provide the customer with constantly-improving

products. Studying market trends in terms of colors (Nerolac Color Week) and

preferences (new texture finishes) and reacting accordingly and introduce latest product

offerings to provide the customer with value for money products

Dealer & Customer Perspective

The company is prompt and proactive in launching new & innovative productsStrongly StronglyDisagree Agree

1 2 3 4 5 6 7

Innovativeness

4.38

4.25

0 1 2 3 4 5 6 7

Customer

Dealer

Inference: Although the company claims that it invests heavily and has undertaken

several measures to constantly innovate and improve its products. The consumer and

dealers do not exhibit the same enthusiasm in agreeing with the company opinion. They

are fairly indifferent to this view, and in all likelihood it maybe because they have not

been informed through the company of the new changes in their products and services.

Marketing & Corporate Communication

1. Change in Corporate Identity

Page 10: Market Research on Paint Industry

Recently, Goodlass Nerolac had changed its corporate identity to Kansai Nerolac on

April 2006. This change in identity is not been made aware to most customers. A larger

number of dealers have also not been informed behind the reason for changing the

company name.

Survey Results

Please write the first thing that comes to your mind in relation to the above picture

Inference: Only 2 out of 73 respondents was able to correctly identify of the change in

the company name. A few dealers were also unaware as to the change in the name of the

company. This obviously shows a colossal gap in communication between the company

and the customers/dealers. Reason for this can be attributed to poor marketing strategy on

behalf of the company; this has also been reflected in the customers being unaware of

their offered services. Insufficient levels of marketing have been undertaken by the

company which reflects in their poor brand recall as well.

2. Brand Mascot

Most of the big players in the industry had a marked similarity, that being the usage of a

brand mascot to promote their products.

Page 11: Market Research on Paint Industry

Goody – Goodlass Nerolac (now Kansai Nerolac)

Asian Paints – Gattu

Off late, both companies have discontinued their brand mascots. The reasoning behind

discontinuing “Goody” was the evident aging of the mascot as suggested by a company

conducted survey. Goody was loosing his ability to influence buyers and the company

needed to change its look which is why the company adorned a new avatar and look

Survey Results

I would be able to relate to the product in a better manner through a brand mascotStrongly StronglyDisagree Agree

1 2 3 4 5 6 7

0

1

2

3

4

5

6

7

Company

Dealer

Customer

Company 4

Dealer 5

Customer 4.9

Brand Mascot

Inference: The Company seems fairly indifferent to the presence of a brand mascot.

However, in the eyes of the customer and the dealer the company would be better off

with a brand mascot – who may not necessarily be “goody”. Once again this reflects on a

Page 12: Market Research on Paint Industry

faulty feedback obtained by the company based on which it has made its decision to

discontinue “goody” on the pretext that he had been ageing.

3. Marketing Avenues

This is primarily required to educate the customers and make them aware of the

advantages offered by Nerolac over other competing companies. It has been observed

that off-late the company has reduced advertising on television to a large extent.

However, the company is targeting other means such as:

a) Print

The company mainly publishes its advertisement in lifestyle magazines so that they

can focus on the target customers.

b) Word-of-mouth

Networking with opinion leaders and influencers (architects, painters, contractors0 is

the best and most effective way of targeting customers.

0

1

2

3

4

5

6

7

Company

Dealer

Customer

Company 5

Dealer 3.75

Customer 5.03

Word of mouth

c) Point of purchase displays

Dealer Perspective

Page 13: Market Research on Paint Industry

The dealer’s response is varied with some suggesting that they receive adequate

marketing assistance whereas the others suggesting that they have only been supplied

with shade cards and company boards.

Inference: It is evident that the marketing assistance offered by the company is not

uniform through all territories with dealers located in popular location with a high

number of interactions with customers are offered more assistance than the others. A

biased dealer assistance policy is being followed which must be remedied to regain

confidence of dealers.

4. Sales Exposure

Page 14: Market Research on Paint Industry

Kansai Nerolac is a very conservative company when it comes to advertisements. They

believe that a product will sell on its merit, as when asked for recommendation a dealer

will naturally recommend a Nerolac product based on its quality. However, a glance at

the market share of the company gives a clear indication that their strategy is flawed and

their product is being overrun by that of Asian Paints who follow a very aggressive

advertising policy by earmarking a large portion of their profits for it. The advertising or

rather lack of it is extremely visible on the part of Kansai Nerolac paints. The new

identity of its product has also not been communicated to its customers who still largely

believe it to be Goodlass Nerolac based on the above results.

0

1

2

3

4

5

6

7

Company

Dealer

Customer

Company 4

Dealer 5.5

Customer 5.2

Sales Exposure

Inference: The company believes that sales exposure is not directly related to level of

sales which is why the follow a conservative strategy. This clearly explains why

customers have a poor brand recall of Nerolac, are largely unaware of its services and

new innovations and are unaware of their new corporate identity.

The dealer and the customer opinion is that, greater the sales exposure higher the

likelihood of the customer picking up a Nerolac product.

5. Brand Recall

Page 15: Market Research on Paint Industry

Exercise 1 – Taglines/Jingles

Customers were asked to identify which company had used the mentioned taglines and

the brand recall used in the previous marketing campaigns under the company name

Goodlass Nerolac was much stronger than the more recent marketing campaigns.

Previous marketing campaigns

During the previous marketing campaigns the company had used the jingle “Jab ghar ki

raunak badhani ho, Jab deewaro ko sajhana ho … Nerolac! Nerolac!” with great success.

The recall of that jingle can be exhibited below as compared to that of the present

marketing campaign being used by the company.

Present Advertising Campaign

Nerolac Impressions – “Aapko Banaye Style Icon”

Nerolac – “Yeh rang hai jo har Jindagi ko choohta hai!”

44

10

0

5

10

15

20

25

30

35

40

45

Previous Marketing Campaign Recent Marketing Campaign

Previous Marketing Campaign 44

Recent Marketing Campaign 10

Brand Recall

Exercise 2 – Picture Assosciation

Page 16: Market Research on Paint Industry

Under this exercise the customers were shown a number of pictures which were closely

related to the brand and would often elicit the company name as a response. The pictures

used were;

1. Picture 1 - Paint Bucket with Paint brush

2. Picture 2 -Amitabh Bachchan with “Goody”

3. Picture 3 - Kansai Nerolac design

Survey Results

Total Sample size = 73

-7

3

13

23

33

43

53

63

73

Picture 1 21

Picture 2 13

Picture 3 12

Number of persons offering desired answer

Distribution Network

Page 17: Market Research on Paint Industry

1. Dealer Appointment

Factory (5)

Regional

Warehouses (8)

Regional

Warehouses (8)

Local Depots (3)

Dealers (15,000+

in India)

Local Depots (3)

Customers

Page 18: Market Research on Paint Industry

Company Perspective

In the interior decorative paint segment all consumer level purchases are made from

dealers. Therefore, they play a critical role in determining the success of a particular

brand of paint. From a company viewpoint the objective of appointing dealers is as

follows:

1. Increase market penetration

2. Market Development & Education of the customer

3. Increase availability/visibility of the brand

4. Leverage dealer skill set and personal contacts

5. Secure payments

Multi-Brand Dealer v/s Exclusive Dealer

When asked about the composition of multi-brand and sole dealers, the interviewee

responded saying that in this segment only those dealers who lack capital resources tend

to become sole dealers. With larger financial resources at their disposal they would have

opted to become multi-brand dealers. Another aspect which dampens the success

prospects of Sole Nerolac Dealer would be the fact that they do not have the strongest

foothold in the market. While, Asian Paints has cornered almost half the market it is

noticeably easier to find an Asian Paints exclusive dealer than a Nerolac one.

Page 19: Market Research on Paint Industry

The only real advantage that an exclusive dealer has over a multi-brand dealer is that of a

higher margin at its disposal as the company offers products at a marginally lower rate to

exclusive dealers. Such cost benefits are often passed onto the end consumer by the

exclusive dealer to entice customers with lower prices.

Multi-brand dealers have the advantage of offering a variety of brands and therefore are a

one-stop shop for customers who will be able to choose the best product in a segment

from a number of principal manufacturers.

Survey Results

I am more comfortable purchasing paint from a multi-brand dealer as they offer a variety of products.Strongly StronglyDisagree Agree

1 2 3 4 5 6 7

Arithmetic Mean = 5.39

Inference: As suggested by the company, the customers prefer going to a dealer stocking

multiple brands of paint rather than just Nerolac, as he would have an idea of the quality

of all the paints he stocks rather than just Nerolac. In turn, would be able to offer a well

grounded advice of which brand of paint is suited to the customers needs.

Types of Dealers

Wholesale Dealers – They serve as feeder dealer to retailers

Retail – Direct contact with the customer and are the last link in the distribution

pipeline.

Industrial – Cater product offerings strictly to institutional buyers.

Dealers

Wholesale Retail Industrial Special Services

Page 20: Market Research on Paint Industry

Special Services – Offer special services to customers on behalf of the company such

as wall-care consultancy, helpline, painting assistance etc.

Pre-requisites to become a Nerolac Dealers

It is the company policy to appoint dealers by invitation rather than application. They do

not want to disturb their existing network by over-concentrating dealers in a particular

region. Demand and supply of the product is assessed in a particular region, in the event

of there being a mismatch a dealer is appointed. The following considerations are taken

into account before appointment of a dealer:

1. Strategically Located

2. Financially sound

3. Relation with influencers (contractors, architects, painters0 in final purchase

decision

4. Market Knowledge

5. Product Knowledge

Dealer Perspective

The dealer opinion is at a complete contrast to that of the company with regard to

appointment of dealers, as they have undergone no such rigorous screening process

before being appointed as dealers of Nerolac. In fact, it is fairly easy to become a stockist

of Nerolac products. It requires a simple application which can be made without any

invitation and superficial survey of the site after which appointment as the dealer is

confirmed by the company.

Inference: This reflects very poorly on the company policy and communication. On one

hand they believe the dealers to be the most critical part of the functional distribution

chain. Whereas, on the other hand they fail to protect the interest of such dealers by

appointing other dealers irrespective of they are capable enough adding value to the

company.

2. Company Assistance

Page 21: Market Research on Paint Industry

The company considers dealers a critical element in the machinery without which their

sales would plummet, which is it believes it needs to take adequate care of them and

providing them with necessary facilities to function becomes quintessential. Listed below

are the ways through which the company provides assistance to dealers:

1. Training

New Dealers are provided training to familiarize them with the existing range of

products their applications and other details. The launch of a new product is

accompanied with training of all dealers regarding its details. It is the company belief

that dealers play a large role in educating the customers regarding the application and

brand of paint to be used. Dealer recommendations are a significant influencing factor

while making the purchase decision. Thus, the dealers must be equipped with

adequate knowledge to make the right recommendation.

Customer Perspective:

4.17 4.3

0

1

2

3

4

5

6

7

Customer Opinion

Dealers have been successful in educating and guiding me to make the rightpurchase

Dealers have adequate product knowledge and are effective in troubleshootingproblems

Inference: Customers are unsure about the kind of advice they receive from the

dealers and how effective it really is in solving problems. This reflects that the dealers

are not performing their job at the desired level, which in turn proves that the

company is not providing proper training to the dealers. This problem can be traced

back to its roots which could be either, improper appointment of dealers who are not

Page 22: Market Research on Paint Industry

capable in satisfying customer anxieties or due to improper training of dealers by the

company.

2. Growth Planning

All dealers are informed of the annual growth targets set by the company and on

achieving the set targets are rewarded with monetary or non-monetary bonus. Several

monthly or special schemes e.g. Diwali scheme, are introduced by the company to

spur dealers into increasing sales.

The top 3-5% dealers based on sales are inducted into the CDC – Core Dealer Club.

This club is offered special privileges on behalf of the company such as:

Attending exhibition abroad

Sending family-members of the dealer on an international vacation

Dealer names mentioned during promotional campaigns.

Dealer Perspective

On the basis of the survey, the average rating for dealers believing the growth targets

set by the company are over-demanding is a 5.75.

Inference: This clearly indicates that the company is setting unreasonable targets for

dealers to achieve which might lead to dealers being de-motivated in promoting their

products. The company policy needs to be changed regarding dealer growth targets

and such targets must be set after consultation with the dealers which would require

an improvement in the corporate communication between the company and the

dealers.

3. Availability

Page 23: Market Research on Paint Industry

The company has been successful in developing an expansive dealer network of over

15,000 dealers across the country. Availability of the product for this reason is not a

major issue. However, this intensifies the competition between dealers and has

resulted in overcrowding of certain spaces which has de-motivated dealers.

Customer perspective

I am unable to find a dealer who stocks Nerolac brand of paints.Strongly StronglyDisagree Agree

1 2 3 4 5 6 7

Arithmetic Mean = 2.3

Inference: This suggests that although customers have no evident difficulty in

locating Nerolac dealers there is an obvious dissatisfaction amongst dealers as they

feel too many dealers are being inducted which is leading to over-crowding. Two

mutual contrasting goals must be met by the company by striking a balance.

4. Commission

Substantially large orders secured by dealers are forwarded directly to the company

and the dealers receive a commission on the transaction.

Dealer Perspective: Some dealers are of the opinion that they receive commission in

the form of rebates, whereas the others receive direct cash commission.

5. Conferences

After networking with several dealers through local/regional/national conferences

they pool in the contacts of architects/painters/contractors. Subsequently, they

organize conferences with each of the major influencers namely – architects, painters

and contractors.

Survey Results

Page 24: Market Research on Paint Industry

However, only 1 of 16 painters and none of the interior designers we interviewed

have ever been involved in any of the above mentioned conferences.

Inference: This indicates that the company has not targeted all existing painters,

dealers and architects and therefore needs to network with customer influencer in a

better manner.

6. Grievance –redressal mechanism

The dealers often direct their problems to the company representative who visits them

within the week. If any problems have been encountered by customers with the paint,

the company representative will send the technical engineer on the site and attempt to

address the situation. Dealers and customers believe that they are able to tackle most

problems through this format of redressing any problems.

7. Marketing Assistance

The company claims that it provides sufficient marketing assistance to the dealers by

providing them with brochures, shade-cards, pamphlets, company signboards and

point of purchase displays.

Dealer survey results

Dealers receive adequate marketing assistance from the companyStrongly StronglyDisagree Agree

1 2 3 4 5 6 7

Mean = 2.75

This reflects that the dealers are very disappointed in the kind of marketing assistance

they receive from the company. The dealers said they only receive shade cards and a

company board from Nerolac and nothing else.

Inference: The Company claims at offering a wide variety of tools as a part of their

marketing assistance program to dealers however, in truth the dealers are starved of

Page 25: Market Research on Paint Industry

necessary tools required to invite and educate the customer with. Complaints filed by

the dealers regarding the lack of marketing assistance have not been taken into

consideration while formulation of the new marketing strategy. On the whole, the

communication between dealer and company seems very disjointed.

Page 26: Market Research on Paint Industry

Customer Behavior

On the basis of the survey most customers seek the following qualities in their brand of

paint:

1. Good Quality

2. Long-lasting

3. Reliable

4. No color fading

5. No paint-sweating

6. Wide range of colors

7. Different textures and designs

8. Value for money

Expectations from the company are fairly limited. They expect the company to be honest

in their approach, transparent, develop new and improved products, price their products

correctly, educate customers regarding usage through marketing material and most

importantly make the product easily available.

Customers would appreciate it if they received expert assistance in terms of selection of

color schemes, application of paint and other related services. Since these services

already exist all that needs to be done from the company viewpoint is increase awareness.

Another trend noticed is that customers usually get their houses painted before Diwali.

Page 27: Market Research on Paint Industry

Influencers

Company Perspective

The company is of the opinion that the influencers can be represented in a diagrammatic

fashion as below;

Depending on where the customer is located, his cultural background, budget and other

variables the size of each size of the triangle varies. Therefore, one cannot generalize by

saying that the architect is the largest influencer.

Page 28: Market Research on Paint Industry

Customer Perspective:

Sample Size = 73

36

12

25

0

5

10

15

20

25

30

35

40

Architect Dealer Painter

Architect 36

Dealer 12

Painter 25

Influencer

Inference: The largest influence is that of the architect, however due to the profile of

respondents restricted to a certain category it is necessary that equal importance be given

to all categories as in some form or the other each one of them influences the customer to

a certain extent.

LoyaltyI am loyal to the dealer I purchase my paints from.Strongly StronglyDisagree Agree

1 2 3 4 5 6 7

Arithmetic Mean = 4.44

Inference: It indicates that, the customer is rather indifferent to where they purchase their

paint from. The common trend is to match the quotations received from 2-3 dealers and

then make the final decision.

Page 29: Market Research on Paint Industry

Hypothesis

On the basis of the collected data and exhaustive quantative and qualitative analysis the

following conclusions can be drawn.

1. Change in corporate identity has gone unnoticed customers;

2. The company is lagging behind in terms of market share because of its

lackadaisical marketing strategy.

3. The customers are happy with the company products quality and variety however,

due to fading brand recall and awareness the customers are drifting away from the

company products.

4. Although “goody’ and “gattu” as brand mascots have been ageing it is necessary

to replace them with new mascots or ambassadors who reflect the company values

and principles so that the customer/dealers can identify with the product.

5. The company-consumer communication channel is almost non-existent as the

company is spending vast amounts of money on R&D and surveys to identify

emerging trends and accordingly release new products. However, these new

product launches are not effectively communicated with the customer.

6. Heavy investments have been made in establishing online services, helpline

numbers and special service dealers but their existence has not been

communicated to the end-customer or dealer, due to which they are not being

utilized. This has lead to increased expenditure which is not accompanied by an

increase in market capitalization.

7. The company has been successful in identifying how and why it needs to

differentiate itself from its competitors but has not been able to act upon it.

8. Previous marketing campaigns were more successful than recent ones as they

were successfully marketed.s

9. Word-of-mouth publicity on its own will not suffice in entices customers, it must

be used in tandom with other avenues of marketing to have a desirable effect.

10. Due to lack of substantial benefits being offered to exclusive dealers most of them

chose to be multi-brand dealers.

Page 30: Market Research on Paint Industry

11. The company employs a double-standard policy in granting commission to some

of its dealers depending on variables such as sales and location. This has in a way

lead to demotivation of dealers.

12. Due to lack of screening while induction and poor training of dealers some of

them lack ability, financial grounding and adequate market knowledge to satisfy

customer queries and requirements. This projects a negative image on part of the

company.

13. The company does not obtain its feedback from customers or dealers regarding

any improvements it can make to its products, company policy or strategies which

is why it occasionally remains distant from reality and is operating under

unrealistic beliefs. E.g. Customer is indifferent to sales-promotion exposure.

14. Networking capabilities of the company is poor which is why they have not been

able to target a large number of contractors, painters and architects to involve

them in local meets and educate them about benefits of Nerolac and seek their

feedback. This has lead to the company moving slower than its competitors in

making changes.

15. Inadequate marketing assistance has lead to disgruntled dealers.

16. Brand recall of the company is poor, which is why when the need to purchase

interior decorative paints arises the names of competitor products occurs before

that of Nerolac and may eventually lead to the loss of sale.

17. Although the Nerolac Impressions brand is the best paint in its segment as

suggested by all dealers, few customers are aware of its tagline. This could be one

of the reasons behind why despite have the most technically sophisticated

products the company is 3rd in terms of market share.