Wednesday, April 24, 2019

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From rural to urban – How Medimix traverses the retail path

By Swaminathan Balasubramanian | April 02, 2019

KHS Manian, President, AVA Cholayil Health Care, the company that manufactures the iconic soap brand Medimix, shares with Retail4Growth, the company’s approach to winning consumers, and creating brand presence in rural retail.

MedimixThe origins of soap brand Medimix go back to a doctor with a vision - Dr V P Sidhan, a doctor with the Indian Railways in 1960s, who founded a solution that cures the skin diseases of railway employees. Since then the brand has come a long way, becoming India’s largest selling handmade soap. As the brand completes 50 years of presence, having reached 22 countries, it’s worthwhile to look at its journey in the market.   

Rooted in rural dynamics

The retail journey of Medimix began with the distribution of samples to small retailers and ended up with 76% reach across all formats of retail stores AVA Cholayil Health Careacross South India. “We wanted to have a unique retail plan. We decided to reach out to remote villages. The advantage was that there was a maximum of two shops in a village run in the households. So by creating a demand from the village, we were able to draw stockists in the nearby towns who automatically started searching for us. Since they came to us, we had an upper hand on the terms and conditions,” says K.H.S.Manian, President, AVA Cholayil Health Care, the company behind brand Medimix.

On revenues from retail, Manian shares that modern trade contributes 7% to 8% of the sale, while traditional stores contribute almost 80%.  Medimix, as a Medimixbrand has almost 40 SKUs and has plans to keep reinventing according to the demands of the customers.

Challenges – Shaping perceptions

Having reached out to the lower and middle class segments, Medimix wanted to reach out to the elite class and began experimenting with different elite clubs in various cities in the process the brand realized it had to change brand perceptions and began doing that through new campaigns. When the brand was later launched outside India, many customers who had visited India had already had a hands-on experience of the soaps and thus retailing the product outside became easy. Today Medimix is available in 8000 hotels and resorts.

Activation

Sampling has been one of the key strategies for Medimix as it is cheaper than a TV ad or other campaigns and also the attention towards the product is high. Medimix reaches out to Government offices, banks, insurance offices etc, engaging employees there and persuading them to try their hand wash and share their experience. Apart from this, they reach out to stores using posters, banners, product placements, window shopping and shop boards. The brand has also tried innovating through shopping bags, cycle campaigns and back-end schemes for retailers.

Catering to changing shopping patterns

Speaking further on the changing purchase trends, Manian says that in India, almost 70% to 80% of monthly earnings are spent on essential commodities and the rest on luxury shopping.  “Thus all forms of retail segments are very important for us. Earlier, consumers’ purchase pattern was need-based, say on a weekly basis, which has now become monthly. Thus bundling of product at affordable rates is vital in retailing. Lifestyle of people has changed and how we are presenting ourselves to appeal to the consumers is also important,” he adds.

Read the full interview in the April ’19 issue of Point of Purchase magazine 

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