Return to Previous Page

Mevicol’s Gambit – Outsmarting the Competition*

CASE STUDY, STRATEGY
ET Cases - FLAME, 8 Pages
AUTHOR(S) : Prof. Kiran Mahasuar, Assistant Professor - Marketing and Strategy Area, International School of Business & Media (ISB&M), Pune

Case Preview

Mevicol’s Gambit – Outsmarting the Competition

Chandan Ghosh (Chandan), the Zonal Sales Manager – East of Mevicol Adhesives, was seemingly worried. After a day-long visit to key plywood mandis and large dealers of Odisha, he sat in a somber mood in his hotel room at Bhubaneswar. He was accompanied by Area Sales Manager (ASM) Soumik Mondal (Soumik) and Market Development Manager of East Zone Rohit Jha (Rohit). The growth of the company in Odisha has been tepid in the past 6 months. Odisha market, a major contributor to the zone’s growth (during 2016 and 2017), has been witnessing serious competition from Maacol & Elite Bond and they have been employing below the belt tactics to lure the users such as wood-working carpenters/contractors and resellers i.e. the major plywood retailers. Mevicol Adhesives was a leading manufacturer of white glue used for wood working with a legacy of superior products and performance (Exhibit I). Despite being in a low-involvement product category like adhesives, Mevicol had a strong brand recall amongst consumers and influencers alike.

The eerie silence in the room was broken by the entry of Market Development Executive, Gokul Mohanty (Gokul). Gokul had been summoned by Rohit to update on competitor activity that was intensified in the last one month. After hearing what Gokul had to say, Chandan had a worried look on his face. Both Elite Bond and Maacol had one objective and that was to seize the market-share from Mevicol and hence resorted to fair as well as unfair means to attract the trade.................

Market Dynamics in Odisha

Mevicol’s market share in Ohisha stood at 82% as per internal competitor benchmarking study with major competitors being Elite Bond (7%) & Maacol (8%) (Exhibit III). In the recent past, Mevicol Speedo has established as the numero uno PWG Brand across key benchmarking counters with over hundred loyal dealers who have an average consumption of 100 kg or more per month. Mevicol Speedo had a mind-boggling growth rate of 400% in 2017 over 2016. Mevicol SH is the oldest and the second biggest brand in the market followed by Elite Bond. Another Mevicol brand, Marino, was also doing well in the competitive premium glue segment with a 53% growth in 2017 over 2016. In addition, Mevicol also had two flanker brands W-Grip Regular with an average sale of around 20 tonnes and W-Grip 3 in 1 which was a new launch. The primary objective of Mevicol’s flanker brands were to counter competition brands and be a trial brand for price-sensitive buyers (primarily institutional buyers) who would otherwise have opted for cheaper and inferior alternatives from competition...........

Understanding the Issues and Challenges

Chandan realized that the quantum of competition had increased in the several A-Class and Super A-Class Counters and together they had eleven Large Competition Dealers (LCDs). Soumik outlined Maacol and Elite Bond’s high-outgo based schemes/gifts and payment exceptions as a major reason for their growth.  A few dealers had de-grown in volume of their business due to emergence of new counters in their vicinity, financial mismanagement or funds diversion to other businesses and overdue payments/debts in the market. After analyzing the current business dynamics, the team had dinner together and called it a day...........

The Blue-Print

Soumik diligently worked hard on preparing a robust strategic roadmap for counter-attack against the competition. In this exercise, he sought assistance (especially market intelligence inputs) of all his teammembers. Rohit stayed back at Bhubaneswar to assist Soumik in this endeavor. The broad contours of the strategic blue-print are outlined in Exhibit VII......

Assignment Questions

I. Critically evaluate the strategic blue-print prepared by ASM Soumik Mandal. What are the gaps or concern areas in the blue-print that necessitate evaluation?
II...........

Exhibits

Exhibit I: Mevicol’s Brands and Their Performance in Odisha

Exhibit II(a): Premium White Glue (PWG) Plan – 2018 (in Kgs)

Exhibit II(b): Nature of the Adhesive Market

Exhibit III: Market Share of various players in Odisha

Exhibit IV(a): Below The Line (BTL) Brand Promotion Initiatives in 2017

Exhibit IV(b): Other Ongoing BTL Brand Promotion Initiatives

Exhibit V: Market’s Categorization of Dealers

Exhibit VI: Mevicol’s Classification of Dealers and Sales of Competition Adhesives

Exhibit VII: Strategic Roadmap for Competition Counter-Action (Odisha Market)

Teaching Note Preview

Mevicol’s Gambit – Outsmarting the Competition

Synopsis

The high-growth territory of Odisha had become a vulnerable spot for Chandan Ghosh, the dynamic Zonal Sales Manager of Mevicol Adhesives.Mevicol expected him to channelize the efforts for the swift turnaround of the troubled territory and at the same time, he had a young and inexperienced management trainee, Soumik Mandal to spearhead the battle. . Secondly, battles had to be fought at multiple levels i.e. firstly at the level of competition wherein the predatory tactics of Maacol and Elite Bond had to be checked and secondly at the level of trade and especially with large competition dealers and loyalty for Mevicol had to be built in accordingly. What could be the possible blueprint for turnaround of the territory taking into account the aforementioned circumstances? The ingredients of the turnaround strategy lay in a clear understanding of the root causes and methodical approach in fixing them all the while using the inherent strength of the brand, strong connect with influencers and market intelligence as a catalyst.

Pre-requisite Conceptual Understandings/Before the Classroom Readings

• Venugopal P., Marketing Channel Management: A Customer-centric Approach, SAGE Publications Pvt. Limited, 2001
• Porter M. E., “How Competitive Forces Shape Strategy”, Readings in strategic management, (pp. 133-143). Palgrave, London, 1989
• Porter M. E., “The Five Competitive Forces that Shape Strategy”, Harvard Business Review, 86(1), 25-40, 2008
• Barney J. B., Gaining and Sustaining Competitive Advantage, Pearson, 2014
• Ghemawat P., “Managing Differences: The Central Challenge of Global Strategy”, Harvard Business Review, 85(3), 58-68, 2007

Case Positioning and Setting

This Case Study can be used in Business Strategy course or Sales & Marketing course in MBA or Executive MBA programs.

Assignment Questions

I. Critically evaluate the strategic blue-print prepared by ASM Soumik Mandal. What are the gaps or concern areas in the blue-print that necessitate evaluation?
II.............

Exhibits

Exhibit (TN)-I: Inputs as Suggested in Strategic Blue-Print and Gaps thereof

$5.48
Rs 0
Product code: STG-1-0066, STG-1-0066A

Abstract

Chandan Ghosh, the Zonal Sales Manager - East of Mevicol Adhesives, was seemingly worried. Mevicol's Odisha market which has been a major contributor to the zone's growth was witnessing serious competition from Maacol & Elite Bond as they had been employing below the belt tactics to lure the users such as wood-working carpenters/contractors and resellers i.e. the major plywood retailers. Unlike Mevicol which relied on product quality, strong branding and a robust and continuous loyalty programme for user connect, these me-too players primarily employed the paradigm of low quality – low price which offered high monetary benefits to the user i.e. the carpenter or contractor. Furthermore, Mevicol was a stingy spender w.r.t spends on bulk dealers and this was in cognizance with its philosophy of using brand equity for consumer pull rather than rely on trade to push its products.

One of the perplexing characteristics of adhesives and sealants industry was low end-consumer involvement in the buying process and consequently the strong mediating role was played by the influencers like the Contractors, Architects and Carpenters. The second issue was the zero traceability of the actual adhesive used for wood-work in a particular space or building. This problem was further compounded by the complexities atypical in industrial projects who were bulk consumers of adhesives wherein the builder or the flat owners presumed the adhesive used was Mevicol but in reality, the contractor or carpenter in collusion with the retailers (for their short-term monetary gains) might have used Maacol or Elite Bond. The case-study details the gambit employed by Chandan Ghosh and his team in adverse circumstances to wrest back the control of the market and ward off the threats by the marginal players.

Pedagogical Objectives

  • To gain a better understanding of competitive dynamics in a monopolistic market
  • To understand the mediating role of trade and influencers in a commodity/non-differentiating B2B product category
  • To design an effective Below-The-Line (BTL) customer marketing strategy to engage the trade and influencers for a low-involvement product like adhesive

Case Positioning and Setting

This Case Study can be used in Business Strategy course or Sales & Marketing course in MBA or Executive MBA programs.


* 4th FLAME International Conference on Research and Teaching Cases, June 21st 2018 & June 22nd 2018



This Case Pack Includes:
- Abstract
- Case Study
- Teaching Note (**ONLY for Academicians)
$5.48
Rs 0

Related Products

There are no related products to show here at the moment.




Request for an Inspection Copy

(Strictly for Review Purpose, Not to be Used for Classroom Discussion/Trainings)