suave final
TRANSCRIPT
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ANJALI TYAGI RAGHAVSOODSAMIR GANDHI
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INDEX
Overview 1
Helene Curtis, Inc 2
Suave 3
Shampoo Market 4
Competitive Environment 5
Brand Loyalty 6
Trade Promotion & Advertising 7
Advertising Debate – The Two Alternatives 8
SWOT Analysis of the Two Plans 9
Marketing Mix of Suave 10
Market Segmentation & Targeting 11
Positioning of Suave 12
Recommendations 13
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OBJECTIVETo determine the two-advertising media plans for Suave shampoo & analyze which is a better alternative for the shampoo which would help the company:
• To fight the current & upcoming competition
• Help them in their fight to maintain their retail shelf-space.
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• Tom Kuykendall, group manager of suave had different views for the fiscal 1985 advertising campaign of Suave as compared to Ellen Vallera, the brand manager.
• Ellen Vallera proposed the $7.8 million plan which focused on day time & prime time television, whereas, Kuykendall proposed a $ 10.2 million plan focused entirely on prime time television.
• Competitors like Gillette with brand White Rain & Procter & Gamble with brand Ivory, were soon planning to introduce a new low priced shampoo & others were also planning a flood of new products.
• With such competition, the fight for retail shelf space would be fierce & suave had to come up with a different advertising strategy to maintain its position.
OVERVIEW
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• Created, manufactured and marketed hair-care and other personal care products.
• Four marketing divisions; Suave being a part of the largest division, Consumer Products.
• In fiscal 1984, it generated $10.4 million in net earnings on$330 million in sales.
• Leading marketer in conditioners and second largest in shampoos in U.S.
HELENE CURTIS INDUSTRIES INC.
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• Suave was a men’s hairdressing in the 1950’s & the first shampoo under the name “Suave” was launched in 1962
• Suave products were used in 16 million homes, more than 90% shampoos.
• Finesse was launched with a $ 20million in advertising & was one of the heavily promoted hair care brands in the industry. Finesse had a much higher gross margin due to the price differential & generated twice the dollar profit per case as compared to suave. Hence, Suave had taken a back seat to Finesse.
• Yet, suave had the longest line of shampoos in the industry, with a total of 40 SKU’s & average of 12 in any grocery store. New product variations were constantly introduced to maintain brand’s vitality & to allow suave users to switch within the suave line.
SUAVE
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• Shampoo market was highly fragmented.
• Sales had been relatively flat in recent years.
• The market was considered mature, industry experts predicted slow growth in coming five years.
• Firms sought untapped consumer segments to sustain growth.
THE SHAMPOO MARKET
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• Shampoo market is loaded with new products supported by heavy advertising and promotion.
• New shampoos were introduced catering to the specialized needs of the consumers.
• Five major competitors were to launch new brands with unprecedented marketing support.
• The industry advertising to sales ratio declined from 13.2% to 10.1%.
• The action in the business is taking place in high and low end of the price spectrum, middle being squeezed.
COMPETITIVE ENVIRONMENT
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BRAND LOYALTY• Brand Loyalty was not very evident in the shampoo industry as the industry was
filled with fickle consumers.
• To develop & maintain loyalty, longer shampoo product lines were marketed to allow consumers to switch among the types of shampoo, but remain in the same shampoo family.
• The reason for such low brand loyalty in the industry was because consumers preferred having number of brands on their shelves since they get bored with shampoos easily.
• Also, they had the tendency to try different brands & types of shampoo.
• However, suave yet had the highest loyalty levels in the industry. But, these customers were very fickle & could switch loyalties easily irrespective of any advertising techniques.
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TRADE PROMOTION & ADVERTISING
• Trade Promotion has been allocated higher budgets in the past compared to advertising. (Ex-2)
• This was due to the fact that retail support was critical to stimulate growth & to satisfy retailers, trade promotion was given higher budget.
• For fiscal 1985, Ellen Vallera’s plan allocates 60% of total spending to trade promotions & 28% to advertising. This follows the previous trend where suave has been successful .
• So, this plan gives adequate attention to advertising & trade promotion. Trade promotion should not be increased more than the allocated 60% which should be sufficient.
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ADVERTISING DEBATE
Suave had two advertising media plans for the fiscal 1985:
1. Ellen Vallera’s $7.8 million plan:
• $7.1 million would be allocated between day time & prime time television & $ 700,000 to the print campaign
• Out of $7.1 million, approximately 43% was allocated to prime time & 47% was allocated to day time network & the remaining to the print campaign.
2. Tom Kuykendall’s $10.2 million plan:
• $ 9.5 million was allocated to the prime time network & nothing during the day time.
• The rest $700,000 approximately was allocated to the print campaign
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S
W
O
TAnalysis
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S T R E N G T H S
Less costlyWider reach (day time & prime timenetwork)Maintain Profit marginMore Gross Rating PointsMaintain & defend base volume
W E A K N E S S E S
Suave could remain under-advertisedPrime time audience might get neglectedBrand awareness might not increaseUpcoming products with heavy advertisingmight remove suave from the market Eg:Dimension with $60 million budget
O P P O R T U N I T I E S
Catering day time & prime time networkwith almost equal weightage Increase in the line of products Opportunity Cost
T H R E A T S
Heavily advertised competitors productsPerception of low quality brandLimited prime time audience reach
ELLEN VALLERA $7.8 MILLION PLAN
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S T R E N G T H S
Brand awareness could be increased.More current & potential customers couldbe reached including working women.Prime time audience could be reachedmore in number.It could match up with the competitorsproduct advertisements.
W E A K N E S S E S
Suave correlated more with retail supportthan with advertising.Daytime viewers would be neglected.It would increase the price as it was a lowmargin product.Doubtful positioning.
O P P O R T U N I T I E S
Estimated Audience Delivery in primetime is majority of total audience.It might change people from perceptionfrom a low value brand by advertising itmore.
T H R E A T S
It would jeopardize their position asnumber one shampoo.They could lose on their trade support.People who prefer suave because of lowprice would not purchase it anymore.
TOM KYUYKENDALL $ 10.2 MILLION PLAN
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MARKETING MIX
TARGETMARKET
Buy SmartDraw!- purchased copies print this document without a watermark .
Visit www.smartdraw.com or call 1-800-768-3729.
PRODUCTHuge Width, length& depth ofproductsMedium or lowquality perceivedby high incomeusersSimilar size ofbottles
PRICEGood value strategy
Less than Competitorsproducts prices
Product Line Pricing
PROMOTION65% through foodstores as the price hadto be kept low &product had to reach atthe grass root level 15% through drugstores & 20% throughmass merchandise
PLACERelied heavily ontrade promotion &then advertising &other marketingpromotionsGrowth correlatedpositively withretail support thanadvertising
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SUAVE’S PRODUCT WIDTH & LENGTH
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PRODUCTSuave’s line of products for hair care:
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SUAVE NATURALS SHAMPOOH
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SUAVE PROFESSIONALS CONDITIONER
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SUAVE NATURALS CONDITIONER
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SUAVE 2 IN 1
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MARKETING MIX
TARGETMARKET
Buy SmartDraw!- purchased copies print this document without a watermark .
Visit www.smartdraw.com or call 1-800-768-3729.
PRODUCTHuge Width, length& depth ofproductsMedium or lowquality perceivedby high incomeusersSimilar size ofbottles
PRICEGood value strategy
Less than Competitorsproducts prices
Product Line Pricing
PROMOTION65% through foodstores as the price hadto be kept low &product had to reach atthe grass root level 15% through drugstores & 20% throughmass merchandise
PLACERelied heavily ontrade promotion &then advertising &other marketingpromotionsGrowth correlatedpositively withretail support thanadvertising
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PRICESuave positioning & USP was it low pricing strategy. (per ounce)
9 cents
13 cents
22 cents
32 cents
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MARKETING MIX
TARGETMARKET
Buy SmartDraw!- purchased copies print this document without a watermark .
Visit www.smartdraw.com or call 1-800-768-3729.
PRODUCTHuge Width, length &depth of productsMedium or low qualityperceived by highincome usersSimilar size of bottles
PRICE
Good value strategy
Less than Competitorsproducts prices
Product Line Pricing
PROMOTIONRelied heavily on tradepromotion & then advertising& other marketingpromotionsGrowth correlated positivelywith retail support thanadvertising
PLACE65% through food storesas the price had to bekept low & product had toreach at the grass rootlevel 15% through drug stores& 20% through massmerchandise
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PROMOTION
Advertis-ing28%
Con-sumer Promo-
tions5%
Trade Pro-mo-
tions60%
Other Marketing7%
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PROMOTION
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MARKETING MIX
TARGETMARKET
Buy SmartDraw!- purchased copies print this document without a watermark .
Visit www.smartdraw.com or call 1-800-768-3729.
PRODUCTHuge Width, length& depth ofproductsMedium or lowquality perceivedby high incomeusersSimilar size ofbottles
PRICEGood value strategy
Less than Competitorsproducts prices
Product Line Pricing
PROMOTION65% through foodstores as the price hadto be kept low &product had to reach atthe grass root level 15% through drugstores & 20% throughmass merchandise
PLACERelied heavily ontrade promotion &then advertising &other marketingpromotionsGrowth correlatedpositively withretail support thanadvertising
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PLACE
Food Stores65%
Drug Stores15%
Mass Mer-chandise20%
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SEGMENTATION &TARGETING
• Heavy shampoo users (more than 144 ounce/ year)
• Household women between age 18-45
• Large families with young children ( family of 5+)
• Middle level income earning who have a preference for low price
• On the basis of price compared with its competitors
• Men between age 18-45 also have been segmented with different variety of
products
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Market Segmentation
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POSITIONING OF SUAVE
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• “Suave makes you look as if you spent a fortune on your hair”
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• “Salon hair-Suave Price”
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• “Beautiful hair does not have to cost a fortune”
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• “Say yes to beautiful hair without paying the price”
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BCG MATRIX
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PRODUCT LIFE CYCLE
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RECOMMENDATION:
Accept Ellen Vallera’s $7.8 million plan & maintain the same ratio of advertising. Prime time has been allotted 43% approx &
day time network has been allotted 47%.
Unit volume should not be affected
More reliance on trade promotion in the past raised doubts about the advertising plan
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RECOMMENDATION:
Higher proportion of budget must be allotted to prime time network since this will ensure wider audience reach.
Target the light users by using the product development & m market penetration growth strategy.
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THANK YOU
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TARGETMARKET
Buy SmartDraw!- purchased copies print this document without a watermark .
Visit www.smartdraw.com or call 1-800-768-3729.
PRODUCTHuge Width, length& depth ofproductsMedium or lowquality perceivedby high incomeusersSimilar size ofbottles
PRICE
Good value strategy
Less thanCompetitorsproducts prices
Product Line Pricing
PROMOTIONRelied heavily on tradepromotion & thenadvertising & othermarketing promotionsGrowth correlatedpositively with retailsupport than advertising
PLACE65% through foodstores as the pricehad to be kept low &product had to reachat the grass rootlevel 15% through drugstores & 20%through massmerchandise
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TARGETMARKET
Buy SmartDraw!- purchased copies print this document without a watermark .
Visit www.smartdraw.com or call 1-800-768-3729.
PRODUCTHuge Width, length &depth of productsMedium or low qualityperceived by highincome usersSimilar size of bottles
PRICE
Good value strategy
Less than Competitorsproducts prices
Product Line Pricing
PROMOTIONRelied heavily on tradepromotion & then advertising& other marketingpromotionsGrowth correlated positivelywith retail support thanadvertising
PLACE65% through food storesas the price had to bekept low & product had toreach at the grass rootlevel 15% through drug stores& 20% through massmerchandise