03.02.04
The always the lowest price syndrome that is wreaking havoc with supplier and marketer profit margins, isnt solely a U.S. phenomenon. The rush to lower prices is even reaching the Indian sub-continent. Today, the Indian unit of Procter & Gamble Co. slashed prices of its top-selling Tide and Ariel detergent packs by between 20 and 50 percent in an attempt to widen its consumer base.
According to sources, most personal care companies are slashing product prices as affordability is crucial in India's farm-dependent economy, where two thirds of the billion-plus population lives off the land. P&Gs move to cut prices and expand its market share also comes amid a stagnant $1.1 billion washing soap and detergent sector in which cut-throat competition from firms such as market leader Hindustan Lever Ltd and Nirma Ltd is intensifying.
Definitely I expect more consumers to get into using our brands, Chester Twigg, sales director at Procter & Gamble, India, said at a news conference. We need to offer consumers more affordable quality products.
P&G controls 11.3 percent of the domestic detergent market in value terms. A 200 gram pack of Tide detergent would now cost 10 rupees and a similar sized Ariel pack would be priced at 22 rupees. Mr. Twigg said P&G was enthused by the consumer response to the halving of prices on 20 gram packs of Tide and Ariel to one rupee and 1.50 rupees respectively in September.
We were encouraged by the early results of the cut in sachet prices, Mr. Twigg said. Sachet sales almost tripled.
About a third of P&G's turnover in India comes from detergent sales. Another firm, Procter & Gamble Hygiene and Health Care Ltd., makes a wide range of health and personal care products.
According to sources, most personal care companies are slashing product prices as affordability is crucial in India's farm-dependent economy, where two thirds of the billion-plus population lives off the land. P&Gs move to cut prices and expand its market share also comes amid a stagnant $1.1 billion washing soap and detergent sector in which cut-throat competition from firms such as market leader Hindustan Lever Ltd and Nirma Ltd is intensifying.
Definitely I expect more consumers to get into using our brands, Chester Twigg, sales director at Procter & Gamble, India, said at a news conference. We need to offer consumers more affordable quality products.
P&G controls 11.3 percent of the domestic detergent market in value terms. A 200 gram pack of Tide detergent would now cost 10 rupees and a similar sized Ariel pack would be priced at 22 rupees. Mr. Twigg said P&G was enthused by the consumer response to the halving of prices on 20 gram packs of Tide and Ariel to one rupee and 1.50 rupees respectively in September.
We were encouraged by the early results of the cut in sachet prices, Mr. Twigg said. Sachet sales almost tripled.
About a third of P&G's turnover in India comes from detergent sales. Another firm, Procter & Gamble Hygiene and Health Care Ltd., makes a wide range of health and personal care products.