Hindustan Lever Ltd, India's largest consumer goods company is calling the shots again. This time it is on the distribution front.
Consumer preference has forced the soaps to food major to revisit its distribution system by redefining its current channels and creating new channels.
Interestingly, Hindustan Lever, which pioneered FMCG distribution in India in 1940s its biggest strength is turning out to be its biggest challenge. In the recent past, competition reared its ugly head in the form of price cuts has forced Lever's to reduce prices in some of its key categories.
Chairman M S Banga at the company's 71 annual general meeting said, "Our earlier focus was to drive wide availability and enable easy access to our brands for consumers. We now seek to go well beyond this distribution paradigm. Our new approach to distribution is holistic and seeks a 3-way convergence of product availability, brand communication and brand experience across multiple channels in rural and urban India."
With consumers today exposed to choices in terms of new categories, new brands and new shopping options enabling them to seek more information in the crowded retail environment is a major challenge for HLL.
Also, the largest advertiser is today faced with the challenge of communication, with consumers exposed to multiple and fragmented media vehicles -- television, newspapers, magazines, hoardings, internet -- all battling for their attention.
"The new distribution initiatives will create employment and vocational opportunities, with our nation-wide network of 7,000 stockists and 6,000 sub-stockists employing over 60,000 people, Banga added.