boots healthcare sales promotion
TRANSCRIPT
Boots – Hair Care Sales Promotion
Abhishek Saha
Arnab Chowdhury
Jeevitha P R
Solomon Dheeraj
Kalyan VBH
Manish Anand
Saurabh S Yadav
Background
• Boots – A well known, retail name in the UK
• Into Health, Beauty products, Personal Care
• 75,000 employees in 130 countries (2004)
• Brands – Strepsils, Clearasil, Nurofen
• New Services – Boots Opticians (1987)
• Boots Healthcare International (1991)
• Product – Retail products of Premium Hair Specialists
Sales Promotion Objectives
• Timeframe – Christmas Season
• Drive Sales Volumes
• ‘Trade-up’ customers from lower value brands
• Retaining and Building brand equity
UK Hair Care Market
• Highly fragmented – 60 major hair care brands
• No brand had more than 9% market share
• Severe price competition
• Volume growth higher than value growth
• Medium – High involvement product
• Significant price discounting via Promotional activity
foreseeable
Major Competitors
P&G
8.4% Market Share
Leading Brand: Pantene
High Consumer Awareness
Alberto-Culver
Revolutionized Ad-slots
Increased product base by Global acquisitions
Wide product-range
L’Oreal
5% Market Share
Portfolio of over 500 brands and 2000 prod.
Pioneer in promotions
Product Retailers
Tesco, Sainsbury’s, Morrisons – Traditional
Supermarket
Superdrug – Value Retail
Consumer Trends
70’s - Gentle Shampoos
80’s - Detangling
90’s – Shiny Hair
• Main purchasers – Fashion Conscious Women
(25-30 Age Group)
• Most Boost customers bought Basic and
Premium brands
• Gender/ Occasion based usage
Promotion Alternatives
Christmas Promotional Activities
3 for 2
The item with the minimum price
would be the free one (competitors didn’t have POS
tech.)
Gift with Purchase
An existing sample would be
bundled along with the regular purchase
On-Pack Coupon
50p off on products which the
customer would be able to redeem
immediately
3 for the price of 2
Consumers could combine any items of their choice
Boots had the Point-of-Sales technology to implement it
Estimated Sales increase is 300% of Pre-promotions
Incentive for Bulk-buying customers
ProsChoice of free item limited to the same brand and not the Brand House
Skeptical customers would think that Boots is trying to ‘push’ its stocks
Price Sensitive consumers would prefer a price discount instead of ‘in kind’
Cons
Gift with Purchase
No additional designing, packaging cost
Estimated 40% sales to Boots shoppers who would not have otherwise purchased a hair-care product
Creates excitement among customers regarding the ‘gift’
Incentive for Bulk-buying customers
ProsNo actual ‘monetary’ savings
Discerning buyers would not be able to choose their gifts
Skeptical customers would think that Boots is trying to ‘push’ its stocks
Cons
On Pack Coupon
Actual savings in monetary terms for the price sensitive consumer
Estimated high usage of coupons as customers would indulge in holiday season shopping anyway
Time-tested and easy to implement – no ‘hi-tech’ implementation reqd.
Pros
No differentiation with competitors
Consumers need to remember to carry the coupons with them for purchase
Cons
Post sales promotion (for premium products)
Impact on variables 3 for 2 GWP On pack coupon
% Increase in Revenues 100% 70% 50%
% Increase in Profits -50% -29% 3%
% of new customer acquisition 60% 40% 50%
Impact on Brand Equity Highly Negative Partially Negative Highly Negative
Post sales promotion (for mass market products)
Impact on variables 3 for 2 GWP On pack coupon
% Increase in Revenues 100% 70% 100%
% Increase in Profits -200% -236% -100%
% of new customer accquisition 60% 40% 50%
Impact on Brand Equity Little/No effect No effect Little/No effect
Open to Questions