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Vi-John Shaving Cream Market Analysis

1. The Indian male grooming market is larger than the female grooming market, valued at $643 million in 2018 and projected to reach $1.2 billion by 2024. 2. Vi-John is a leading personal care brand in India, especially known for its shaving cream which has a 29.2% market share. 3. While Vi-John dominates in volume sales, its value share is less than competitors like Gillette due to its more affordable pricing. The company is working to improve packaging, quality, and pricing to increase its value share while maintaining volume leadership.

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DIVYANSHU SHEKHAR
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46 views4 pages

Vi-John Shaving Cream Market Analysis

1. The Indian male grooming market is larger than the female grooming market, valued at $643 million in 2018 and projected to reach $1.2 billion by 2024. 2. Vi-John is a leading personal care brand in India, especially known for its shaving cream which has a 29.2% market share. 3. While Vi-John dominates in volume sales, its value share is less than competitors like Gillette due to its more affordable pricing. The company is working to improve packaging, quality, and pricing to increase its value share while maintaining volume leadership.

Uploaded by

DIVYANSHU SHEKHAR
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

SVKM’S NMIMS

School of Business Management, Bengaluru


Program: Master of Business Administration

Year: I Trimester: II
Subject: Marketing Management Marks: 20
Date: 19/10/2021 Time: 10 am to 5 pm

· Instructions to Students:

a. Please answer the questions at the end of the case

b. Submit only the word document. PDF or another format will not be accepted

c. You may source information/data from company reports or other authentic public
documents to support your answers. However, you have to give an insert in the word
document and give the source with website URL. Failing to cite sources may result in the
answer being treated as plagiarised version.

Vi-John Case Study


It shouldn’t come as a surprise to know that the Indian men’s grooming market is valued higher
than the female grooming market. According to a report, the Indian female grooming market
stood at $152 million in 2018 and is projected to grow at CAGR of more than 26% and
surpassing $623 million by 2024 whereas the Indian male grooming market stood at $643
million in 2018, projected to grow at a CAGR of above 11% to cross $1.2 billion by 2024. [1]
While men’s grooming market was confined to more shaving and haircut about two decades
ago, today its scope extends well beyond those domains. The men’s grooming market includes:
men’s shaving products, men’s skincare, men’s haircare, beard care and men’s fragrance
market. Thanks to Emami (the first company that launched men’s fairness cream, Fair and
Handsome) the men’s grooming sector started booming from 2005. After that launch, the men’s
grooming market gained traction and is growing at a remarkable rate. This can be attributed to
the increasing disposable income of the urban middle-class population, rising urbanisation, and
more importantly the changing consumer preferences of the male population.
Changing consumer preferences has also had a major impact in type of products sold. Rewind
to the 1950s-early 2000s, the customers preferred shaving-specific products (i.e. baby boomers
still prefer a clean ‘neat’ look) and fast-forward to the 2020, most millennials prefer honing a
beard. The influence of social media and style of celebrities has led to metrosexual men
considering the latest ‘beard’ trends in the market.
The major players or the well-known brands in the market in the shaving cream sector include:
Gillette, Beiersdorf, Unilever, Energiser Holdings, Godrej, etc. but these behemoths have one
big competitor that they have not been able to de-throne, i.e., Vi-John.
Vi-John Group was founded in the 1960s by the Late Sardar Suchit Singh Kochar, with humble
beginnings of only three types of products: fragrant hair oil, cream and talcum powder. Their
success story started when Suchit Singh formulated a new shaving cream. The founder at that
point felt the need to give the product an ‘English’ name to ensure the consumers thought of it
as a high-quality product that was imported.
Vi-John went on to expand their business over the years and now have products under the
following categories: fragrance, facial care, body care, hair care, men’s grooming, talcum and
winter care. Their shaving cream had the highest volume market share in India at 23% in May
2015, which was three times that of Dettol and over seven times that of Gillette.
Current CEO, Vimal Pande is perhaps an ideal brand ambassador for the company. For the past
decade, he's been a loyal user of 'Cobra' deodorant, 'Splash' after-shave, '22 degree' talcum
powder, even 'BoroShield' antiseptic cream, all brands of the little-known Delhi-based personal
care firm, Vi-John. He's also one of thousands of consumers who annually consume almost 45
lakh kg of Vi-John's shaving cream, in the process making it the largest label in this category
"In shaving cream, we are much bigger than Gillette in India, both in volume and value," asserts
52-year-old Pande. And if being ahead of a global leader isn't enough, he goes on to make
another claim. "In fact, we are the largest selling shaving cream brand in the world."

According to Nielsen MAT, Vi-John's volume market share in India stood at 29.2 % in May,
over three times that of Dettol, almost four times that of Axe and over seven times that of
Gillette.

"Even if you put the next four brands together, they won't be able to match our volume and
value share in India. The biggest plus for the brand has been its 'affordability' tag. Vi-John is
available across 2.5 lakh retail outlets and at over 1 million other trading channels across the
country. The brand makes over 15 lakh shaving cream packs every month”, says Pande.

What the MNCs lose in volume, though, is being partially made up in value. Consider: Gillette's
3.9 per cent volume gives it a close to double value share of 7 per cent; Axe 7.4 per cent volume
converts into 12.9 per cent value share. It's only in Vi-John's case that its value share is less
than the volume share. Pande acknowledges the problem. "We are quite visible on TV. But our
profitability is not as high as others." Maybe we need to revisit our pricing strategy is what he
indicated.
The company is making improvements in packaging, quality and more importantly pricing,
which would be crucial to push it ahead in the value trajectory. While in 2011, its 125 gram
shaving cream pack was available for Rs 20, it now costs Rs 35.

What has worked brilliantly for Vi-John has been the endorsement by Shah Rukh Khan.
Celebrity endorsements has played a significant role in brand awareness, helping it make a
rapid transition from a B2B brand to a B2C brand, explains Abraham Koshy, professor of
marketing at IIM Ahmedabad. "Had it not been for the celebrity endorsement, the brand could
not have pulled it through."
However, converting volume into value at a faster clip won't be easy. It's a brand game, which
has to be played with finesse, says brand strategist Harish Bijoor. "One celebrity will not turn
the tide for it. There are a lot more brand parameters that need to be addressed and tweaked.”

The biggest problem for Vi-John, according to Bijoor, is that it has not invested in branding.
"The product has worked, the brand has not. Not yet. What's missing is brand imagery. And it
needs to earn it fast. Another definite weak spot is the brand’s pricing. “
Exhibit 1

Vi John produces over 15 lakh shaving cream packs every month


It is available in 2.5 lakh retail outlets and 1 million trading channels across the county
Vi John’s Feather Touch is the second largest player in the Rs 350 crore hair removal
category. Reckitt Benckiser’s Veet is the largest brand.
Lip Guard is the second largest brand in the lip guard segment. Largest is HUL’s
Vaseline.

Exhibit 2

Examination questions: Each question carries 5 marks


1. Profile and segment the shaving cream market in India.
2. Map the Brands to the segments with the help of a ‘positioning map’.
3. Given the changing consumer preferences, from a ‘neat’ look to sporting a beard, what
should be the focus of Vi-John’s product strategy?
4. Identify and explain a pricing strategy that will ensure Vi-John’s Value share matches that
of its Volume (given that Value gap is greater than 20% over the nearest competitor and Value
gap is ONLY 10% greater than that of the nearest competitor. Refer Exhibit 2)

Common questions

Powered by AI

Vi-John's broad product line, encompassing fragrance, skincare, and grooming, allows for cross-promotion and leveraging consumer loyalty across categories . This diversification supports resilience against market fluctuations, providing multiple avenues for growth. However, aligning these products under a cohesive brand identity and enhancing cross-category synergies can optimize marketing effectiveness and consumer engagement, translating to more robust long-term growth .

Vi-John should diversify its product line to include beard grooming products, such as beard oils, balms, and trimmers, aligning with the millennial trend towards sporting beards . Incorporating products that offer styling and care for beards can attract a wider consumer base. Additionally, enhancing the visibility of these products through targeted marketing, possibly leveraging celebrity endorsements, can reinforce the brand's relevance in evolving grooming trends .

Vi-John differentiates itself through affordability, extensive distribution across 2.5 lakh retail outlets and 1 million trading channels, and strong volume market share . Their significant pricing advantage aids in capturing volume but poses a challenge in matching value market share, resulting from limited brand investment . Despite celebrity endorsements, the challenge remains in enhancing brand imagery and aligning product premiumization with consumer expectations, crucial for Vi-John's trajectory towards improved value share .

The growth of the Indian men's grooming market is primarily driven by the increasing disposable income of the urban middle-class population and rising urbanization . This contrasts with the women's grooming market which, while also benefiting from economic factors, is expanding more rapidly at a CAGR of over 26%, led by product diversification and enhanced marketing efforts . The shift in consumer preferences among men, influenced by social media and celebrity styling, adds to this growth, favoring trends like beards and personalized grooming .

Vi-John maintains its market lead with an extensive distribution network, making its products available across 2.5 lakh retail outlets and through over 1 million trading channels nationwide . To improve, Vi-John could explore deeper penetration into rural areas, optimize logistics to reduce costs, and integrate digital sales channels to tap into online shopping trends . Emphasizing more strategic placements in high-footfall modern retail formats could also enhance visibility and accessibility.

To balance volume and value market shares, Vi-John could adopt a tiered pricing strategy that includes premium versions of its existing products to capture higher value segments while maintaining affordability . This could involve offering added features or benefits that justify the price increase. Implementing price adjustments in response to market trends without alienating its established consumer base will be crucial, alongside targeted promotions to enhance perceived value .

Vi-John's volume market share is significantly higher than its value share due to its affordability-driven approach, affecting profit margins . To close the gap, Vi-John could reassess its pricing strategy by introducing premium product lines or enhancing product qualities that allow higher pricing . Branding initiatives that strengthen perceived value, alongside reductions in operational costs, can further align its value share with market competitors .

Celebrity endorsement, exemplified by Shah Rukh Khan's association, significantly boosts Vi-John's brand awareness and aids in its transition from a B2B to a B2C model . However, for long-term success, it must be complemented with comprehensive brand strategies such as robust brand imagery, ongoing consumer engagement, and sustained investment in branding initiatives to reinforce and broaden brand appeal beyond singular person-related fame .

Vi-John has effectively utilized celebrity endorsements, notably with Shah Rukh Khan, to enhance brand recognition and channel consumer interest . To build brand equity further, Vi-John should integrate such endorsements with storytelling that conveys brand values and lifestyle associations. Additionally, expanding influencer marketing to include diverse personalities across digital platforms can broaden reach and resonate more deeply with varied consumer segments .

The shift from a 'neat' to a 'beard' look among consumers necessitates a re-evaluation of product positioning for shaving creams. Brands must market their products not only for shaving needs but also as part of an overall grooming regimen, incorporating messages on precision shaving and pre/post beard care . Developing campaigns that emphasize hybrid grooming solutions catering to both clean-shaven and styled beard looks can effectively address evolving consumer preferences .

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