Chik Shampoo Marketing Strategy | Sachet Revolution in Shampoo Industry | This simple idea changed FMCG Market forever

There are two India’s India one consists of 110 million people but commands the GDP of one trillion dollars on the other hand we have India too 1200 million people that too command a GDP of one trillion dollars one that goes on to quora and asked if making 1.2 CR a year is a good package and the other that makes 150 to a thousand rupees each day the reason I’m talking about the start is because these days there is a lot of buzz on Twitter and other social media about how targeting the cream of the crop of India the one percent of India the rich India is the only way for you to make money in India as a business but I am here to tell you about a story of a little entrepreneur from Tamil Nadu that targeted this underserved India created a good product not only revolutionized the FMCG industry in India but also forced the Western FMCG Market to reconsider their strategy and he did all of this while building a thousand crore company, I’m talking about shiksha the first company to sell shampoo in sachet 

The Rise of Shampoo 

Currently more than 70 percent of sales of all shampoo happen in form of sashes but this was not true 40 years ago when the majority of these FMCG products were distributed in bulky packages bottles which made it accessible only for the elite and building this is when chunni Krishnan an agriculturist who ran a small pharmaceutical business in kuttal or Tamil Nadu went on an inventive streak that led him to give talcum powder an Epsom salt to consumers in sachet form and the only reason he did this was because he saw many laborers around him who got paid in Daily wages which was anywhere from 150 Rupees to thousand bucks which rendered them unable to buy something as basic as shampoo or powder or salt because the single packet would cost up to 100 bucks so they either could buy salt which cost them 100 rupees and sleep hungry because they would have no money left for food or eat food without salt so Mr chunni Krishnan took it upon himself to make these Necessities available to poor people his ideology behind this was based upon what a rich man can enjoy a common man should be able to afford shampoo is a commodity which every single individual should be able to access especially with ever-growing hair issues hair fall that Indians face.

Marketing strategy

Chunni Krishan the transition from Salt and dark to Sasha style shampoo was natural but due to lack of good marketing and his passing away in 1982 the business was overtaken by his sons who started a regional company called velvet shampoo which sold its product in small parts of tamilnadu but in 1983 the youngest brother CK ranganathan made his decision to leave other brothers and launch his own Cosmetic Company with Savings of 15 000 rupees in a small shed he began producing sachet by hiring two chemistry grads to work on the formulation he gave the shampoo the name chik named after his father and set the price at 75 percent making it accessible to even the poorest of poor who had till then not even dreamed of using shampoo for their hair with rural Market in South India being chik’s main Market he sold up to 20 000 sachets within just the first month of his business as chik started to make money and acquire significant traction just in second year of business the company moved its headquarters to Chennai in 1989 and changed its name to beauty cosmetics private limited after being well known in rural marketplaces of Tamil Nadu even though seeing the growth chik shampoo experience Hindustan Unilever limited and godrej try to compete in this category unfortunately for them chik was miles ahead of them in the session segment unlike his dad’s sache business which was slow to grow due to poor marketing CK made sure that he utilized variety of marketing and sales strategies that’s assisted make making chik a household name in Tamil Nadu one of the most intriguing marketing strategies that CK applied was how he brought customers attention to Chik shampoo especially the ones who had never used shampoo in all their lives you see CK understood that the only way to gain rural India’s attention was through something that they loved the most which were movies of beloved actors like rajinikanth so like a true arter winner he started running three rajavi Khan movies who not only had high reputation and trust but also had god-like celebrity status in villages of Southern India and in between these movies they showed advertisement and live demonstration of using chik shampoo so much so that the audience was invited to touch and smell the freshly shampooed hair of the volunteers they also gave the audience free sachets to try which helped chik build a really strong brand awareness thus becoming a household name in South India. 

Chik Dominating market share

However with the entry of larger FMCG players in around 1988 check implemented an Innovative scheme in which customers could return up to 5 used sachets of any shampoo to a retailer and receive a free shiksha the scheme was later modified and they began giving away free shampoo in exchange for sashes of only chik shampoo now the customers were price conscious began purchasing only chik shampoo with sales nearly doubling to 10 lakh sachets each month in just one year this program did wonders for the business the reason chik shampoo was Raising far ahead of its competitors was because of its keen understanding of the local region for example chik shampoo was one of the first Brands to introduce variants with floral fragrances Rose and Jasmine because CK realized that the southern Indian women love to decorate their hair with gajra especially the gajra that was made out of rose and Jasmine flowers this move again worked very well for chik that in 1991 they tripled their sales up to 30 lakh sachets per month and became the number one shampoo brand in South India see it doesn’t stop here chik figured out that most of the companies were selling their shampoos at one or two rupees but customers Were Somehow still wary of buying things so chik decided that they’re gonna cut their margins further and sell their shampoo at just 50 paise but CK was daring and bold which made this shampoo a blockbuster by 2003 chik had achieved 22 percent of the market share making its second largest national shampoo brand in India just behind Hindustan unilever’s Clinic plus with Revenue up to 200 crores INR you see the reason I wanted to tell you about the story of chik shampoo was because because everybody nowadays is trying to aim for the top there’s too much competition over there I believe that if you have an idea and the guts to make that Vision into in reality nobody can stop you. 

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