Ujala - The Supreme Whitener

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What Lies Ahead Contd... In the dish washing segment, it had to face 'Vim,' which was brought out by the country's number one FMCG company, the Unilever subsidiary Hindustan Lever Ltd. (HLL13); and in the mosquito repellent segment it had to deal with formidable brands such as 'All-Out,' 'Tortoise' and 'Good Knight.' In the soaps category, Jyothi seemed to have played it safe by entering a niche segment - however, even here, popular brands 'Hamam' and 'Medimix' were expected to give Jeeva a tough time. Meanwhile, in October 2002, ARIA Investment Partners L.P, CDC Financial Services (Mauritius) Limited, and South Asia Regional Fund14 collectively invested about Rs 1.3 billion in Jyothi. The investment was one of the largest non-technology private equity transactions in India in that calendar year. The move suggested that the new investors trusted Jyothi to 'pull off an Ujala' in the new categories it had entered into. Whether the company would be able to do so or not was something only time would tell.

Questions for Discussion

1. Analyze the conditions prevailing in the Indian fabric whitener market when Jyothi Laboratories entered the whitener segment. Focusing separately on each element of the marketing mix, explain how and why the company's moves helped Ujala become the market leader.

2. With R&C planning to continue its efforts to regain Robin's lost glory and Pidilite promoting Ranipal aggressively, what do you think the future has in store for Ujala? What measures would you recommend to help Ujala maintain its leadership status?

3. Critically comment on the rationale underlying Jyothi's decision to diversify into other segments of the FMCG sector. Do you think Jyothi will find it difficult to replicate Ujala's success with its new products? Justify your answer.

When Jyothi entered the fabric whitener segment, it had to contend with only one national-level player. But the new segments it had entered into were already dominated by many strong brands.

Exhibit

Exhibit I: An Ujala TV Commercial

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13] In 2001, HLL shifted its fabric whitener brand 'Ala' under one of its major fabric care brands, 'Rin.' This move was accompanied by the brand's relaunch with new packaging and new promotional thrust. Though Ala was not a 'blue' and was classified as a 'bleach,' it rapidly gained popularity as a fabric whitener due to HLL's strong marketing support.
14] ARIA Investment Partners, L.P is a pan-Asian private equity fund which backs the expansion of successful businesses across Asia. CDC Financial Services (Mauritius) Limited and South Asia Regional Fund are both affiliates of CDC Capital Partners, a leading private equity investor focusing on Indian and India-focused companies. CDC Capital Partners has a $ 250 million portfolio of over 50 investments across a wide range of companies.