By: Dheeraj TripathiPGDM 2013-15Roll no: 1301-065Section A

Case Analysis: Boots- Hair Care Sales Promotion

OBJECTIVE

To drive sales volume

To trade-up consumers from lower-value brands

Retain and build the brand equity

• Highly Fragmented with 60 major brands• None of the brands has more than 9% market

share• Severe price competition• Volume growth more than value • Significant price discounting through

promotional activity

UK HAIR CARE MARKET

• 8.4% Market Share• High brand awareness• Leading Brand PanteneP&G

• Broad assortment of shampoos, conditioners and styling agents

• Top brands: St. Ives, VO5, FDSAlberto-Culver

• 5% market share• More than 500 brands & more than 2000

productsL’ Oreal

• Tesco, Sainsbury & Morrisons – Major retail players

• Super drug is direct competitorHair Care product

Retailers

COMPETITORS

3 for 2 • Item with minimum price in the purchase of 3 items would be free• Competitors doesn’t have the technology at POS to imitate the

promotion: Could be a differentiating factor

Gift with purchase• A product sample free along with a regular purchase (usually 75 ml)• Existing sample product would be used to avoid the need to design

and produce additional packaging

On-Pack Coupon• 50 pence off on the product• More conservative approach• Easily redeemable

PROMOTIONAL ALTERNATIVES

Pros•Consumer would get 3 items for a regular price buy of two.•Consumers could combine any three items •competitors did not have the technology at the point of sale to

imitate this promotion.•Expected that sales would increase to 300 % of pre-promotion

sales•60 % new buyers

Cons•Profit margins reduce substantially •Brand equity may dilute

3 FOR 2

Pros•Product sample would be given free along with a

regular purchase.•Additional packing would be used to pack the free

sample along with the existing one.•Estimated sales would increase by 170% of the pre-

promotional sales.•40 % new customers

Cons•Additional cost of 93 pence for bundling the sample

with the product•Common strategy, competitors can easily imitate.

GWP

Pros•Customers would be able to redeem their coupons

during their current store visit.•Sales are estimated to increase by 150% of the pre-

promotional sales.•50 % of the customers would be just promotional buyers.•Coupons would enable multiple visits for a single

customer.

Cons•Brand dilution•Common strategy, competitors can easily imitate.

ON-PACK COUPON

FINANCIAL ANALYSIS

Microsoft Office Excel 97-2003 Worksheet

Current Promotional Scheme

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THANK YOU