ANJALI TYAGI RAGHAVSOODSAMIR GANDHI

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

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.

• 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

• 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.

• 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

• 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

• 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

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.

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.

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

S W

O T

Analysis

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

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

MARKETING MIX

TARGETMARKET

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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

SUAVE’S PRODUCT WIDTH & LENGTH

PRODUCTSuave’s line of products for hair care:

SUAVE NATURALS SHAMPOOH

SUAVE PROFESSIONALS CONDITIONER

SUAVE NATURALS CONDITIONER

SUAVE 2 IN 1

MARKETING MIX

TARGETMARKET

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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

PRICESuave positioning & USP was it low pricing strategy. (per ounce)

9 cents

13 cents

22 cents

32 cents

MARKETING MIX

TARGETMARKET

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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

PROMOTION

Advertis-ing28%

Con-sumer Promo-

tions5%

Trade Pro-mo-

tions60%

Other Marketing7%

PROMOTION

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

PLACE

Food Stores65%

Drug Stores15%

Mass Mer-chandise20%

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

Market Segmentation

POSITIONING OF SUAVE

• “Suave makes you look as if you spent a fortune on your hair”

• “Salon hair-Suave Price”

• “Beautiful hair does not have to cost a fortune”

• “Say yes to beautiful hair without paying the price”

BCG MATRIX

PRODUCT LIFE CYCLE

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

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.

THANK YOU

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

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