CavinKare - The Small 'Big' Company

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Case Details:

Case Code : MKTA017
Case Length : 19 Pages
Period : 1988-2004
Pub Date : 2005
Teaching Note :Not Available
Organization : CavinKare
Industry : Cosmetics
Countries : India

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Background Note Contd...

By 1990, Chik had become the market leader in the southern rural markets with over 50% market share. Chik India, which was renamed as Beauty Cosmetics in 1990, clocked an impressive 45% growth over the decade.

The firm gradually extended its product range to herbal wash powder (Meera) in 1991, herbal shampoo (Nyle) in 1993, perfume (Spinz) in 1997, fairness cream (Fairever) and hair-dye (Indica) in 1998, and herbal soap (Meera) in 2000.

While brands like Chik, Nyle, Spinz and Fairever were launced nationally, others like Meera and Indica remained regional, with a predominant presence in the Southern states.

In 1998, the company was renamed CavinKare Pvt. Ltd. Ranganathan wanted a name, which did not restrict its scope to just cosmetics. He had plans to enter segments like personal care products and detergents. The new name was chosen by combining 'Cavin', a literary word in Tamil language symbolizing beauty and grace, and Kare which was modified to start with a K instead of C as a tribute to Chinni Krishnan.

Cavinkare's logo had the letters 'c' and 'k' well defined in a leaf-like form. This gave the company its herbal orientation, even though the herbal portfolio (Meera, the herbal hair wash powder, Nyle and Indica hair dye) contributed to less than half of its total revenues.

Feedback from the trade as well as its own market research showed that CavinKare needed to change the perception of it being a purely herbal company, even as it continued to roll out herbal products.

To convey a contemporary image as well as to signal its wider product portfolio, CavinKare unveiled a new logo in 2000 (Figure ii). In the late 1990s, CavinKare's brand-building activities gained momentum in overseas markets. CavinKare exported its creams (Fairever) and shampoos (Nyle) to Malaysia and Sri Lanka where they received a good response. In 2000, CavinKare extended its Nyle range of shampoos with the launch of Nyle Wonder in Tamil Nadu...

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