IMAGINING A SOLUTION FOR NON-CONSUMERS
The name Godrej is synonymous with refrigerator in India, but electricity is unavailable or unreliable in many rural areas, and millions of families earning under $5 per day can’t afford to buy one. The idea to address the basic refrigeration needs of rural households in began in 2006 at a disruptive innovation workshop led by Innosight co-founder Professor Clayton Christensen of Harvard Business School.
Could a community step up and help create a solution? Godrej Vice President G. Sunderraman led trips to rural communities, observing the daily routines of villagers. Using our “jobs-to-be-done” approach, he and the Innosight team witnessed how those consumers purchased, prepared, and stored food and drinks.
Defining a simple but urgent “job”
We concluded that these homes didn’t need cheap refrigerators. The job was much more specific. People needed an affordable way to keep milk, vegetables and leftovers cool for a day or two—both at home or away. This job is urgent in a country where a third of all food is lost to spoilage, according to the United Nations Commission on Sustainable Development.
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Godrej developed a series of prototypes for feedback at “co-creation” events. Over time, a consensus set of features emerged. From this effort came the ChotuKool, or “little cool” in Hindi. The portable unit has 45 liters of volume inside a plastic body of less than 10 pounds. Instead of traditional compressors, ChotuKool is based on a thermoelectric chip that maintains a cool temperature on a 12-volt DC current—and can plug into a car battery or be left unplugged for hours. The unconventional opening ensures cold air settles down in the cabinet to minimize air loss. Priced less than half that of an entry level refrigerator, Chotukool creates a new product category, with a targeted value proposition that serves a new segment of customers.
“Clayton Christensen and the Innosight team were insistent that we focus on non-users and the unique aspects of people who don’t currently buy refrigerators.”
– Navrose Godrej, Executive Director, Godrej & Boyce
Developing the business model
Since ChotuKool is so unique, Godrej needed to evolve a new business model to fit the market. Innosight suggested options for a new kind of financing plan and low-cost distribution system through community-based sales agents as well as postal system employees.
Godrej sold about 100,000 ChotuKools in its second full year on the market. The early success of ChotuKool led to Godrej being named India’s most innovative company of the year by Business Standard magazine in a ceremony conducted by the nation’s Prime Minister. BusinessWeek and Fast Company named Godrej one of the world’s “most innovative companies.” ChotuKool was also awarded the 2012 Edison Award Gold prize for the Social Impact category. More recently, Godrej redesigned and relaunched ChotuKool as a major consumer brand addressing more jobs-to-be-done. The expanded marketing includes a way for consumers to order personalized versions online.
Chotukool Case Study Solutions
2853 WordsOct 1st, 201212 Pages
Marketing Case Study (2) Godrej ChotuKool: A Cooling Solution for Mass Markets
Q.1. Assess the business scenario for ChotuKool? What are the critical success factors for this product to succeed?
ChotuKool falls in to the business of refrigeration, to understand the business better let us understand the overall refrigeration business
But before that lets looks at the consumer durable market, the consumer durable market consists of products from watches to fans. With the help of the below mentioned data we can understand the penetration and reach of a consumer durable like refrigerator in comparison to a product like Television Set, car, bike or Grinder.
This will help us in having a deeper knowledge of the placement of a retrigger in the…show more content…
A study by Assocham in 2011 estimated the rural consumer durables market to grow at 40% in 2012 as a result of higher disposable income among rural consumers. The size of the home appliance market in India is pegged at `30,000 crore, with air-conditioners, refrigerators and washing machines as the largest categories, though household peneration levels are in low single-digits.
Current Scenario in India, * Refrigerators have the 2nd highest aspirational value of all consumer durables * High growth rate of the refrigerator market. * Refrigerators are manufactured in two basic designs which are referred to as Direct Cool (DC) and Frost Free (FF) refrigerator.
Godrej’s share in the refrigeration market as shown below is 18 %
Critical success factors for chotuKool:
Let us study the critical success factors on the basis of the 4p’s of marketing
Designed specifically for rural consumer
Runs on low power and invertors
Runs on battery when there’s load shedding
Colour chosen on the basis of consumer interest
Use of unconventional cooling technology
Compared to the 200 components of a refrigerator, it has only 20 components
Power consumption is comparatively less (15 to 65 W against 90 – 100W)
It has no moving components, is almost service free
ChotuKool weights only 9kg and is therefore easy to move around and transport
The operational cost is low
The average electricity bill for running the ChotuKool is only Rs 60 to Rs 70 per month