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HOUSEHOLD PRODUCTS(I) Ltd.
Submitted By:-
Shradha Devidan
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IN COMPANY ANALYSIS
• Reason for the New product
– Internal Force
• Vegetable oil introduction as a soap ingredient – citing innovation
•
Introduction in high price sector : Higher profit margins per tonne – External Force
• Marginally declining profits in low priced soaps
• Extent of Newness• Addition to existing product line
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MARKET FOCUS
• Focus on Latent Needs of Customer
– Vegetarianism
– Religious Needs
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PRODUCT LAUNCH PLAN
• Test launch in October 1998 in
– Hyderabad (AP)
– Indore (MP)
• Information System based on
– Company sales data
– Bi-Monthly audit of sample retail shops
– Monthly checks of a sample of households
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SALES DATA ANALYSIS
• Potential overall decrease in fragrance soap market
• Increase in Dec -98 subject to the discounts offered.
0
50
100
150
200
250
300
350
400
450
500
Oct-98 Nov-98 Dec-98 Jan-99 Feb-99 Mar-99 Apr-99 May-99
Hyderabad
Indore
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SALES DATA ANALYSIS
• Indore : More Responsive State
SEHRA MARKET SHARE BY VALUE
0
1
2
3
4
5
6
7
Jaimala
Sehra
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SALES DATA ANALYSIS
• No. of rebuy :
Hyderabad: 30% Indore: 20%
From Exhibit 1 and 3:
Hyderabad:
Penetration of Sehra in IC A and B in Oct 1988- 1.6%. This corresponds to asale of 400,000 units of Sehra.
In April 1999 the additional buyers are 1.3% while the sales are 300,000.
Thus this indicates that the sales are mostly due to the new buyers than theold buyers rebuying the product in the latter part of the product trial.
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% of new buyers in each month- Hyd
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SALES DATA ANALYSIS
• The percentage of families buying ‘Sehra’ hasincreased while ‘Jaimala’ has gone down inHyderabad.
•However the sales of ‘Sehra’ has gone down overthe trial period.
• This indicates that either the market size hasreduced for the combined sales of ‘Sehra’ and‘Jaimala’ or the no. of units bought per family hasreduced for Sehra.
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% of families buying Sehra and Jaimala
in HyderabadOct Nov Dec Jan Feb Mar Apr May
Sehra 1.58 2.52 3.82 3.42 3.18 4.14 3.83 4.00
Jaimala 7.05 6.40 6.87 5.84 5.51 5.52 4.07 4.28
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SALES DATA ANALYSIS
• Since in Hyd where the product was tested forbeing negatively treated the figures show that ithas been accepted by an increasing no. of families than in Indore.
• Also there has been a drop in market share of both Sehra and Jaimala in Hyderabad.
• The drop in sales is to be attributed to thereduction in the market for the jasmine fragrancetoilet soap category.
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Evaluation of SEHRA decisions
• Concept development
• CONCEPT – “Jasmine perfumed soap brand made
exclusively from vegetable oils”
• Vegetable Oil – distinguishing feature
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Evaluation of SEHRA decisions
• Concept Testing
– No consumer testing of the concept before it was
converted into actual product.
– Based on the Marketing Manager and the Product
Manager perceptions.
– Sent to the R&D department directly for
transformation into product
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Evaluation of SEHRA decisions
• Product Development
– Consumer research done for the two chosen
perfume fragrances
– R&D was able to develop a vegetable oil soap
which tended to wear down at comparatively
lower rate
–
Although no STATISTICALLY SIGNIFICANTdifference was found between the competition
and the main experimental perfume, it was still
launched.
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Evaluation of SEHRA decisions
• Market Testing
– Standard Test Marketing followed
– Test run in two cities
• Indore (responsive to the “vegetarianism feature”
added)
• Hyderabad ( non- responsive to the “vegetarianism
feature” added)
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Evaluation of SEHRA decisions
• Commercialization
– Near-Perfect choice of test centers
• Indore : 57% vegetarian : would prefer Vegetable oil compared to
animal fats
• Hyderabad : < 10% vegetarian : not essentially a criteria for
selection
– Advertising campaign : Legendary bride decorated with
jasmine flowers.
• Initial, marketed as high price – apt advertisement
• Results showed hit the low price sector majorly – bad choice of
advertisement
– Sehra Gained more from Low Price
» Hyderabad – 28.3 v/s 23.1
» Indore : 23.7 v/s 19.4
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Product Launch at National Level
•Wrong POSITIONINGof the product in Test
Market
–
Was pitched as a high priced soap costing at
Rs. 7.5 (market average
was 8)
– Sehra Gained morefrom Low Price
• Hyderabad – 28.3 v/s
23.1
• Indore : 23.7 v/s 19.4
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Product Launch at National Level
• Decline in market for fragrance soaps
• Preliminary Results show that perfume of
Sehra was considered weaker than that of
Jaimala
• Not many respondents identified the claim of
“made from pure vegetable oils”.
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Product Launch at National Level
• If launched at the same price with same
results- the purpose of launching a soap in
premium segment fails.
• Also since it is gaining more from the low
price segment, the test marketing should
have also included income groups C &
D(income below Rs.5000 per month)
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Product Launch at National Level
• If price is increased and repositioning done, the
entire Campaign will change and again it needs to
be test marketed to see results.
• Also there is a change in the overall trend in themarket (exhibit 4) as families buying both Sehra and
Jaimala have decreased. It might mean that people
no longer relish the Jasmine perfume.
• Considering all this we do not recommend the
product to be launched at the National Level at this
stage.