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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 LOreal 5% Market Share Portfolio of over 500 brands and 2000 prod. Pioneer in promotions Alberto-Culver Revolutionized Ad-slots Increased product base by Global acquisitions Wide product-range Product Retailers Tesco, Sainsburys, Morrisons Traditional Supermarket Superdrug Value Retail

Consumer Trends
70s - Gentle Shampoos 80s Detangling 90s 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 Gift with On-Pack Coupon Purchase The item with the 50p off on minimum price An existing products which the would be the free sample would be customer would one (competitors bundled along with be able to redeem didnt have POS the regular immediately tech.) purchase

3 for the price of 2


Pros
Consumers could combine any items of their choice

Cons
Choice of free item limited to the same brand and not the Brand House

Boots had the Point-ofSales technology to implement it

Skeptical customers would think that Boots is trying to push its stocks

Estimated Sales increase is 300% of Prepromotions

Price Sensitive consumers would prefer a price discount instead of in kind

Incentive for Bulk-buying customers

Gift with Purchase


Pros
No additional designing, packaging cost

Cons
No actual monetary savings

Estimated 40% sales to Boots shoppers who would not have otherwise purchased a hair-care product Creates excitement among customers regarding the gift

Discerning buyers would not be able to choose their gifts

Skeptical customers would think that Boots is trying to push its stocks

Incentive for Bulk-buying customers

On Pack Coupon
Pros
Actual savings in monetary terms for the price sensitive consumer

Cons
No differentiation with competitors

Estimated high usage of coupons as customers would indulge in holiday season shopping anyway

Consumers need to remember to carry the coupons with them for purchase

Time-tested and easy to implement no hi-tech implementation reqd.

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

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