To drive that, the company announced on Wednesday its decision to restructure the organisation into two divisionscosmetics division and personal care division. While the former will focus on lipsticks, nail enamels, face and eye products and will be serviced by the existing sales team, the personal care division will dedicatedly drive the Colorsilk hair colors, Flex shampoo, Charlie fragrances and skincare products.
To strengthen its personal care division, the company has entered into a distribution agreement with Win Medicare, an associate pharma company which will give Modi Revlon access to 1,20,000 chemists outlets. Simultaneously, the company plans to increase its reach in cosmetic outlets to 10,000 from the current 3,000 and personal care outlets to 25,000.
Meanwhile, in the colour cosmetics segment where it claims to have grown by 27 per cent compared to the category growth of 15 per cent during 2000-01, the company plans to strengthen its position in the premium segment.
Revealing its strategy, Mr Modi said that the company will launch new brands without specifying which brands and also consolidate on its retail strength in the premium segment. Besides, it also plans to drive growth in the premium segment by introducing new products in the existing ColorStay range. The company aims to achieve sales growth of 50 per cent in 2002 besides an increase in marketshare from 22 per cent to 26 per cent.
The company also announced its plans to start manufacturing its products in India from February 2002 via its wholly-owned subsidiary Kamakhya Cosmetics & Pharmaceuticals Ltd.
Modi Revlon has been outsourcing its range of products including skincare, haircare and colour cosmetics over the last six years. We will begin manufacturing almost our entire product range in India (except fragrances) in this new plant at Assam. At present, this plant will cater to the domestic demand and later may be extended to exports, Mr Modi said.
He said the company was eyeing a turnover of Rs 100 crore within the next three years and plans to double the advertising budget this year to realise the 50 per cent growth rate targeted for 2002.
Modi Revlon, which has been operating in India since 1994, embarked on the volume-driven growth path by following the strategy of slashing prices by lowering pack sizes. Starting with the launch of its mini nail enamel early last year, Modi Revlon extended the same strategy to other products in its portfolio, namely lipsticks and perfumes. The cosmetics maker claims the strategy helped it increase sales by almost 50 per cent.