Pradnya Shah

140103123

Sales volumes should increase for its hair

care products

Attract consumers from the lower value

brands

Build and retain the brand equity

Consider the competitors both in hair care

products and retail stores

3 for 2

GWP

On-pack coupon (50% off)

P&G.

Alberto culver: 2000 franchised store in us.

St. ives, vo5, consort hair care for men.

L’oreal: société française de teintures

inoffensives pour cheveux.

500 brands and more than 2000 products.

It held more than 5% share of the U.K hair

care market.

Tesco

Sainbury

Superdrug started in 1966. (700 stores in

U.K).

It has attractive physical facilities.

Advantages Disadvantages

Consumer would get 3 items for

a regular price buy of 2

Would be perceived as a Stock

clearing strategy

Consumers could combine any 3

items as they like e.g. shampoo,

conditioner and styling gel of

same brand

Premium products would lose

their brand equity and may

sound as some cheap promotion

Most competitors did not have

the technology at the point of

sale to imitate this promotion

Product partners (Hair dressers)

may oppose this strategy for the

dilution of their brand equity

Estimation was that sales would

increase to 300 %

60% customers – promotional

buyers

Advantages Disadvantages

Product sample would be given

free along with a regular

purchase

Adding the sample would cost

approx. 90p per unit for the

product plus 3p per unit extra to

secure the sample to the

featured product

Estimated sales would increase

by 170% of the pre-promotional

sales

This is a very common startegy

used by most of the retailers and

can be easily imitated

40% of the customers would be

just promotional buyers

Advantages Disadvantages

Customers would be able to

redeem their coupons during

their current store visit

This is a very common strategy

used by most of the retailers and

can be easily imitated

Estimated sales would increase

by 150% of the pre-promotional

sales

Form of discounting which can

dilute the brand equity

50% of the customers would be

just promotional buyers

More of a conservative approach

Coupons would enable multiple

visits for a single customer

Less estimated sales growth as

per the market research

Alternatives 3 For 2 GWP On Pack Coupon

All calculations are done for 1 day

Cost per bottle (Pounds) 1.4 1.4 1.4

Estimated Sales for 1 Day 300 Units 170 Units 150 Units

Promoitonal Cost per Unit Production cost

Production cost + Sample cost

Production cost + Discount cost

Promoitonal Cost per Unit (Pounds) 1.4 2.33 1.9

Total Cost (Pounds) 420 396.1 285

Total Revenue (Pounds) 600 340 300

Net Profit (Pounds) 180 -56.1 15

Have a good day..