Brand

February 4th, 2023

NATCO Brand

NATCO is an acronym for the initial”s National Confectionery Co. It is a very popular brand name in England, which tries to satisfy the needs of the Asian community it is often mistaken that NATCO is the name of the company; but this is not true. NATCO is only a brand name for an international trading company, a specialist in Indian foods, -T. Choitram & Sons. T. Choitram & sons is the largest chain of supermarkets in the U.A.E., a confectionery manufacturer, a wholesaler, a cash &carry operator, and the manufacturer and packer of more than 250 products marketed and distributed in the UK under the NATCO brand.

Some of the other brands of the company are Papa – lentil and spices, Leone – tea, Koto – medicated products, Family – tissues, NATCO – sweet and biscuits. NATCO was their first and is their main brand, and NATCO sells more than any other of their brands does. This is why we also have emphasized more on the NATCO brand in our report. NATCO is called the lucky brand for the company, as they believe that this brand has led to them towards success.

Topics, which will be discussed in the report, are the management structure, their company history, manufacturing process and facilities, inventory control, quality control, just in time and forecasting. The helpful staff of NATCO kindly provided this information.

T.Choitram although an Indian migrated to West Africa in 1942. At the age of 17, he began his enderpreneurial career by selling seeds fruits magazines. He was a man who was always motivated with the dream to be a very successful businessman. He saw his future in the food industry and so he began his own supermarket and named it after himself. As years passed by he gained tremendous success and due to this he launched a brand name i.e. NATCO for his trading company in the year of 1968.

In London, T. Choitram & sons, a packaging firm has been in the competitive market of packaging and distributing foodstuff, spices, and confectionery for over 40 years. The owner of company has come a long way from a small grocery store in Sierre Lonne to one of the biggest distributor of foodstuff in London. With his unique managerial style he succeeded in bringing up his trading company to be one of the best in the world.

T. Choithram & sons is located at Wembley. The factory and warehouse together under one roof occupies around 25,000-sq. ft. in area. NATCO has employed over 150 skilled and unskilled labor, and has a staff of around 50 people, which adds up to a total of 200 people employed at NATCO. NATCOs team of highly experienced buyers is regularly traveling the Four Corners of the globe to source the best quality crop for export to their Wembley factory to be packed under the NATCO label. They guarantee premium products at the best price, ensuring that NATCO is excellent Value of money.

The NATCO brand was first launched in the UK in the early 60s, catering to the needs of the Asian communities. The extensive product range includes Spices, Lentils, Beans, Flours, Nuts, Dried Fruits, Basmati Rice, Canned Products, Butter Gee, Betel Nuts, Pappadums and much more. NATCO brand today is known for its superior quality standards. NATCO products are exported through a network of distributors to U.S.A, Canada, European Community, Middle East, and West Africa and they are continuing to develop these export markets.

Papa is the other brand name for NATCO. T. Choithram and sons came up with this other brand name because in many countries, government regulations allow only one agent for a brand for the whole country. This limits the sales in those countries. To increase the sales in these countries they planned to have more distributors. They could not introduce Papa into the other countries as a brand of T. Choithram as it would be an illegal activity. To legalize it they came up with a plan, which would help them to sell the Papa brand in the countries where NATCO already exists and it would not be illegal at the same time. They established a new company Orient Foods. Papa is a brand name for this new company and sold in outside market, which helps NATCO compete with other similar product. This move has helped the company as its sales have increased in foreign markets.

The mission statement for NATCO is we shall strive to produce the very best product and materials available, when and where they are wanted and at a price that represents good value at every stage of the trading process, from the harvest to the shelf, to the factory to the home.

The organization of NATCO is based mainly on the three function called Finance, Marketing, and Operations. Each of these functions has its own managers or directors.

Finance is the lifeblood of commerce and industry. The finance department of NATCO has the responsibility of ensuring that enough funds are available for the smooth operations of the organization. Mr. R.D.Rajwani, the managing director of the company, also commented on the finance department that it is concerned with budgeting activities of the other departments. He also mentioned that this department also operates the cost and budgeting control system by gathering and analyzing cost and other financial data, before the redistribution of information in the form of performance report. Mr.Rajwani also talked about the other activities dealt with this department, such as handling accounts of income and expenditure, payment of wages, pricing decision, etc. It also involves the function of banking. Banking involves depositing cash, withdrawal of cash, taking loans, discounting of bills.

Marketing function of NATCO comprises of number of sub-function such as publicity and advertising, sales promotion, samples and coupons, fairs and exhibitions, public relations, distribution and marketing resources. It is the function of the marketing department to advertise and price the product. The marketing department closely works with operation and production department, so that the changes could be administered from time to time as per the result of market research. The sub-functions under marketing are very essential for the business. They sub functions are explained as follows: —

1) Publicity and Advertising– Advertising has become an indispensable function in the modern business due to the competition and mass production. Publicity brings forth production to the knowledge of the consumer and helps both in creating and maintaining demand for the goods produced. It persuades people to buy goods and services again and again. It helps to create regular demand by smoothening out seasonal and other fluctuations. Without publicity, goods may not be taken note of and in the absence of demand; production of those goods may have to be stopped. It creates a good image of the company and reputation of the products. It adds to the goodwill of the enterprise.

2) Sales Promotion- Sales promotion includes all those activities, which are directed towards the promotion of sales such as organizing publicity, introductory sales. It also includes personal as well as innovative selling. Though the ultimate aim of sales is to increase sales and profit, but it is different from advertising and personal selling in approach and technique.

3) Samples and Coupons- Distribution of free samples of smaller size of the product is an effective device of sales promotion, especially to introduce a new product. Samples may be widely distributed or given only to selected customers. Customers can test the product before purchase. Premium or prizes may be given to the buyer on the purchase of some specific product e.g. one Lux toilet soap for the purchase of an economy pack of Surf. In some cases coupons are issued to prospective buyers through newspapers. Sometimes clearance sales, off-season sales, reduction.

4) Public Relations- Public relations aim at securing favorable opinion and good of the public towards the enterprise. A business enterprise price must build up a good image of its own to have better sales. It must maintain cordial relations with the clients and always look after their welfare. It must go on informing the public about the improvement in packing, the quality or the new uses of the products and influence their decision to buy the product. It must give prompt attention to their suggestions and to the redressal of their complaints. It must take note of the bias or the special prejudices of the customers and try to win over their support.

5) Fairs and Exhibitions- Business enterprises always like to participate in fairs and exhibitions to promote their sales. Some of them organize their own exhibitions of their own products. Fairs and exhibitions are held on local, regional or international level. Trade Fair Authority of India organizes various exhibitions of different kinds at various places in the country.

This department of NATCO consists of all the activities concerned with the production of food and services. The operation function is dependent on the finance side for its financial needs and on the marketing department for further research and development of the products. The operation function of NATCO is concerned with transformation of various inputs into desired outputs.

Manufacturing organization is usually beuracratic in structure. The word beurocratic is not used despairingly but rather in true sense, which implies division of labor into bureaus or departments. The organization structure of NATCO is a typical pyramid type structure, each post at one level subordinate to a post at a higher level. After our visit to the company we observed that each person is responsible to only one-person level, which is a sign of an organized company.

The division of labor in the company allowed the advantage of specialization to be obtained. To be precise, each person had specific and often unique task to perform. As seen in most of manufacturing firms, the labor force is divided into skilled and unskilled labor, NATCO also has this kind of mix. The labor strength existing in the company is around 150 of whom the majority is skilled. The staff employed at NATCO is about 50, which add up to 200 people working for the company.

February 4th, 2023

Niké, Inc.: Product Line and Brand Positioning

Table of contents

Abstract

Niké, Inc. uses a brand marketing mix that is as multicultural and diverse as all the people in the planet. They make sure that there is a product for the type of gender, design, activity, color, and price for every type of customer, and are basically centered on the youth of the middle and lower classes, which they encourage by offering prices that are discounted or even below $25. They try to make it as convenient as possible, with the help of technology, famous personalities, as well as attractive advertising and endorsement. With 25,000 retailers across the globe, and a website that reaches all parts of the globe, Niké attempts to focus on individuality, while being diverse and multicultural at the same time.

Niké, Inc.: Product Line and Brand Positioning

Niké, Inc. was founded in 1972 by co-founder Bill Bowerman and Philip Bowerman in the industry of sportswear and sports equipment (Niké, Inc., 2008). With its headquarters stated at Beaverton, Oregon, its main products range from athletic shoes to apparel, to other sports equipments and other accessories. It employs more than 30,000 employees worldwide, has revenue of approximately US$17.92 billion, and with a net income of about US$1.492 billion (Niké, Inc., 2008). It is recognized as “the world’s leading supplier of athletic shoes, apparel and sports equipment” (Niké, Inc., 2008). It started in 1964 as Blue Ribbon Sports, and officially became Niké, Inc. by 1978 (Niké, Inc., 2008).

This paper revolves around the product line and brand positioning of Niké, Inc., reflecting over their product, price, distribution, and promotion strategy implemented by the company. In the end portion, we include a recommendation based on the present characteristics and strategies implemented by the company.

Main Body

Product & Price

There are a variety of items that Niké manufactures, such as athletic shoes, apparel, and sports equipment. It mainly offers shoes for men, women and children, which may be used in various sports activities like running, basketball, cross training, soccer, tennis, golf, baseball, football, volleyball, bicycling, and even for aquatic activities like scuba diving.

The Niké store at <www.nike.com> displays products that are divided according to gender, product type, sport, color, and price. The gender category displays products that are for women, for girls, for men, and for boys. Product type, on the other hand, is divided into footwear, equipment, apparel, and accessories. The sport category displays action sports (e.g., basketball, golf, soccer, swim), and even include an outdoor, walking, and training sub-categories. Examples of colors that are being displayed are black, brown, green, khaki, pink, red, blue, etc. Prices range from $200 and below, $150 and below, $125 and below, $100 and below, $75 and below, $50 and below, $25 and below, and the clearance category, where discounted products are being displayed (Niké.com, 2008). This makes it more convenient for buyers to choose from an array of product type, color, sport, design, and even prices.

It appears that the prices that are being displayed reflect a target audience that is centered on the middle and lower classes of the society. There is no specific age, gender, or sport (or activity) that is being targeted in the website. It is evident that Niké has been targeting a more diverse and global type of customers, as it reflects activities that are not centered on the sports-minded people anymore, but on anyone who would be walking, running, or even dancing.[1] They are trying to target as many customers as possible.

Distribution

Products of Niké are being distributed to as much as 25,000 retailers across the globe, in outlets and ‘Niketown stores’ that are allocated in about 160 countries worldwide (Niké, Inc., 2008). The company is enjoying its manufacturing and distribution under a ‘global’ level, where global demand for brand name shoes of the athletes has been on growth (Porter, Harris, & Yeung, 2002, p.5). However, as implied by Jeff Porter, Mark Harris, and Gavin Yeung (2002) in their research paper, Niké’s customer benefits remain to be under the regional level. As the authors imposed: “Though there is global demand for products in Niké’s competitive industry, customers view the product differently and therefore derived benefits based on age, maturity and cultural standards or outlooks” (Porter, Harris, & Yeung, 2002, p.5). For example, in U.S.A., customers would usually go for “performance characteristics, their association with a popular U.S. sport, and the endorsement from the pre-eminent start of that sport” (Porter, Harris, & Yeung, 2002, p.5). In Europe, however, customers would rather go for the product’s identification and technical aspects, their cultural relationship to the product, and the ongoing trend of the season.

There are international markets where Niké sells its products by means of independent distributors, licensees, and subsidiaries, with about 700 manufacturing shops and offices scattered in about 45 countries around the world, such as Indonesia, China, Taiwan, India, Thailand, Vietnam, and Malaysia (Niké, Inc., 2008). For this, their global focus should include the competitive issues of the marketing industry, including the gray markets as well as the black markets.[2] These two elements of arbitrage highly influence the distribution processes of global companies like Niké.

Brand positioning

Nike’s marketing strategy revolves around the use of brand images (i.e., sports athletes) that would attract customers to buying the company’s products. As a premium brand and selling, well-designed, popular company, Niké requires a good marketing strategy in order to build profits. Its marketing strategy can be witnessed in its advertising logo: Just do it. It uses athletes that, as much as possible, carry the corporate culture with a manner that is ‘cocky, proud, and gutsy’. Celebrities like LeBron James, Steve Nash, and Kobe Bryant are perfect images for this new generation culture that Niké emphasizes.

Niké’s brand image revolves around its distinct quality of being the sole athletic shoes in the world of sports. As Phil Knight dictated, it is like speaking to athletes in a language that is recognizable only by them—sharing their passion, their sentiments, and their goal as far as sports is concerned (Keller, 1998, p.119). Athlete Steve Prefontaine in 1973 was the first to wear and endorse the shoe with the swoosh sign. The basic attitude revolved around ‘the athlete against the establishment’ stance, with an attitude of a middle-class, cocky person that is ruled by pride and by guts.[3] In the early ‘80s, new sources of brand equity started to enter the scene: those that were usually dominated by women, but focusing on the athletic picture nonetheless. By the ‘90s, the Niké attitude started to dominate the world of the sports shoe industry, when the ‘Just Do It’ ad campaign started to control the mass, revolving around the theme of self-empowerment, courage, and endurance. Until now, celebrity athletes and professional teams continue to dominate the brand positioning of Niké; yet the company had tried to include issues with respect to globalization, diversity, human rights, as well as corporate and community responsibility.

Promotion strategy

Niké usually uses brand images like celebrity athletes and professional teams who endorse their products. The endorsers include athletes in the game of soccer (e.g., Ronaldinho, Ronaldo, and Roberto Carlos), basketball (e.g., Lebron James, Kobe Bryant), cycling (e.g., Lance Armstrong), golf (e.g., Tiger Woods), and many more. In 2006, Niké had a partnership with iPod when they featured the Niké+iPod Sport Kit, which is a personal sensing device that is put in the shoes, with a receiver that is attached to the iPod Nanos.[4] Just this month, however, another promotional strategy that is used is the New Race Experience, wherein one million runners from 25 cities race in one-day running event that are to be held in top cities like LA, New York, London, Paris, Istanbul, Melbourne, Shanghai, and Vancouver (Nikebiz.com, 2008). There is also the sponsorship of athletic programs in schools and universities, and the sponsorship of events, such as the Hoop It Up and The Golden West Invitational that are both held in schools and universities. It is evident that what the company basically targets, as a whole, are the youth customers of this century.

Conclusion & Recommendation

Elements of its brand marketing mix are consistent with one other, as the basic intention is to catch as many buyers as possible, while reflecting a good and adequate job of serving the needs of a diverse, global world. The pricing is very convenient to anyone who would want to buy products that are above $200 or for those who would want to buy those that are only about $25. There are enough appropriate outlets and channels worldwide to endorse customers into buying the products. However, it would be better if the number of products for boys and girls would be increased, since a better portion of them is under the men and women categories. Packaging and discounts are also good, especially that competition is heavy with other companies like Reebok, Adidas, and Puma. When it comes to brand positioning and advertising, however, it would be better if the overall theme of being ‘diverse’ and ‘global’ can be applied, too, on these corresponding aspects. Because the overall theme is to be global, then advertisements should move away from the usual cocky style and then start to reflect cultures and attitudes that are as diverse as the real cultures of the globe. It would also be best to prevent promotional projects that entail negative, critical issues like those that are connected to privacy and personal safety. By implementing these, each of the elements of the brand marketing mix would be more consistent to one another.

References

Niké, Inc. (2008). Retrieved May 20, 2008, from the Wikipedia Online Encyclopedia database: http://en.wikipedia.org/wiki/Nike%2C_Inc.
Nikebiz.com. (2008, May 1). Nike+human race: the world’s largest one day running event. Retrieved May 20, 2008, from its official database: http://www.nikebiz.com/media/pr/2008/05/01_HumanRace.html.
Nike.com. (2008). NikeStore. Retrieved May 20, 2008, from the official database: http://www.nike.com/index.jhtml?l=nikestore&re=US&co=US&la=EN&ref=http%3A//www.nikebiz.com/customer_service/#l=nikestore,grid,_grid,f-10003+49581/so-publishDate0&re=US&co=US&la=EN.
Keller, K. (Ed.). (1998). Niké: building a global brand. In Strategic brand management. New York: Prentice Hall, Inc.
Porter, J., Harris, M., & Yeung, G. (2002). Niké. Retrieved May 20, 2008, from the Gaven Yeung Homepage, University of California, Los Angeles database: http://www.cs.ucla.edu/~gavin/pub/IntlBusMgmtNike.pdf.
Saponas, T.S., Lester, J., Hartung, C., & Kohno, T. (2006). Devices that tell on you: the Niké+iPod Sport Kit. Retrieved May 20, 2008, from the University of Washington, Seattle, Department of Computer Science and Engineering database: http://www.cs.washington.edu/research/systems/nikeipod/tracker-paper.pdf.
Niké, Inc. is known in the area of Youth culture, the Hip Hop, and the Chav Culture (Niké, Inc., 2008).
Gray markets are those that take form “when price differentials between two countries exist to the level that arbitrage becomes attractive” (Porter, Harris, & Yeung, 2002, p.6); while the black markets are those that take form “when purchases occur in the market where product is available and resold in another areas with little or no supply” (Porter, Harris, & Yeung, 2002, p.6).
These are attitudes that speak lines like, I do not care what other people think…or I have a world of my own and I’ll fight ‘til the end.
There is, however, controversy here with regards to privacy and personal safety.

February 4th, 2023

Literature Review on Brand Awareness

Definition of ‘Brand Awareness’ The likelihood that consumers recognize the existence and availability of a company’s product or service. Creating brand awareness is one of the key steps in promoting a product Brand Awareness is the extent to which a brand is recognized by potential customers, and is correctly associated with a particular product. Expressed usually as a percentage of target market, brand awareness is the primary goal of advertising in the early months or years of a product’s introduction.

Brand awareness is the extent to which the consumer associates the brand with the product he desires to buy. It is the brand recall and the brand recognition of the company to the consumers. Brand recall is the ability of the consumer to recollect the brand with reference to the product where as brand recognition is the potential of the consumer to retrieve the past knowledge of the brand when enquired about the brand or shown an image of the brand logo.

Brand awareness is an essential part of brand development which helps the brand to stand out from the others in this monopolistically competitive market Importance “Awareness, attitudes, and usage (AAU) metrics relate closely to what has been called the Hierarchy of Effects, an assumption that customers progress through sequential stages from lack of awareness, through initial purchase of a product, to brand loyalty. ” In total, these AAU metrics allow companies to track trends in customer knowledge and attitudes. [2] Brand awareness plays a major role in a consumer’s buying decision process.

The knowledge of an acquaintance or friend having used the product in the past or a high recognition of the product through constant advertisements and associations coaxes the person to make his decision in the favour of the brand. The eventual goal of most businesses is to make profits and increase sales. Businesses intend to increase their consumer pool and encourage repeat purchases. Apple is a brilliant example of how there is a very high recognition of the brand logo and high anticipation of a new product being released by the company.

An iPod is the first thing that pops into our minds when we think of purchasing an mp3 player. iPod is used as a replaceable noun to describe an mp3 player. Finally, high brand awareness about a product suggests that the brand is easily recognizable and accepted by the market in a way that the brand is differentiated from similar products and other competitors. Brand building also helps in improving brand loyalty Brand awareness is an important way of promoting commodity-related products. This is because for these products, there are very few factors that differentiate one product from its competitors.

Therefore, the product that maintains the highest brand awareness compared to its competitors will usually get the most sales. In the study “Effects of Brand Awareness on Choice for a Common Repeat Purchase-Product” prepared by Wayne D. Hoyer and Steven P. Brown, published by the University of Chicago Press in the journal “Journal of Consumer Research Vol. 17,No. 2(sep. ,1990) gives an abstract that Results of a controlled experiment on the role of brand awareness in the consumer choice process showed that brand awareness was a dominant choice heuristic among awareness-group subjects.

Subjects with no brand awareness tended to sample more brands and selected the high-quality brand on the final choice significantly more often than those with brand awareness. Thus, when quality differences exist among competing brands, consumers may “pay a price” for employing simple choice heuristics such as brand awareness in the interest of economizing time and effort. However, building brand awareness is a viable strategy for advertising aimed at increasing brand-choice probabilities.

In their research ,Brand awareness is defined as a rudimentary level of brand knowledge involving,at the least, recognition of a brand name. Awareness represents lowest end of continuum of brand knowledge that ranges from simple recognition of the brand name to highly developed cognitive structure based on detailed information. Recognition is taken here to be the process of perceiving a brand as previously encountered(Mandler 1980). Thus the distinction between awareness and recognition is a subtle one,former denting a state of knowledge possessed by the consumer and the latter a cognitive process resulting from awareness.

According to Keller (2003) stated that Brand awareness can be referred to as the ability of a consumer to distinguish a brand under various conditions. Keller (2003) also noted that brand awareness is built and increased by familiarity with the brand as a result of repeated vulnerability which eventually leads to consumers experience with the brand. Consumer’s experience of a particular brand could either be by hearing, seeing, or thinking about it and this will help the brand to stick in their memory.

Brand awareness can be referred to as the degree of consumers’ familiarity with a brand. Aaker (1991) According to Aaker (1991 p. 62), there are three levels of brand awareness: * Brand recognition: It is the ability of consumers to identify a certain brand amongst other i. e. “aided recall”. Aided recall is a situation whereby a person is asked to identify a recognized brand name from a list of brands from the same product class. * Brand recall: This is a situation whereby a consumer is expected to name a brand in a product class.

It is also referred to as “unaided recall” as they are not given any clue from the product class. * Top of mind: This is referred to as the first brand that a consumer can recall amongst a given class of product. Many researchers have seen brand awareness as an element that plays a vital role in consumer’s choice of brand. Aaker (1991) prescribed some of the following factors as ways to achieve brand awareness: * Involve a slogan or jingle: a slogan is a visible feature of a brand. There can be a strong link between a slogan and a brand.

The slogan and jingle are powerful and can be a great change for a brand. * Be different and memorable: as a result of the similarity between product and their means of communication, product differentiation is important. * Symbol exposure: a known symbol will make it easier to recall and memorize a visible illustration of the brand. A logo that is connected to an existing brand or a developed brand will play a vital role in developing and keeping brand awareness. * Publicity: one of the most important ways to get publicity and create awareness is through advertisement. Event sponsorship: sponsorship of event can also help to create and maintain awareness. * Consider brand extension: one way to increase brand recall is to show the logo or name on the product and make the name popular. Example of this is coca-cola which is more publicized than the key product. * Using cue: packaging is one of the most significant cues to a brand due to the fact that it is what the purchaser sees when purchasing a product. If the product or brand is not known, the only means of contact to the brand or product is the package. Hankinson and Cowking 1993), indicates in order to achieve the brand acceptance, the relationship between the customer and brand – perception of customer to brand is needed. The customer’s psychological and physical needs and the brand’s symbolic values and functional attributes will be reflect by the strong relationship between customers the brand Brand awareness is essential in buying decision-making as it is important that consumers recall the brand in the context of a given specific product category, awareness increasing the probability that the brand will be a member of the consideration set.

Awareness also affects decisions about brands in the consideration set, even in the absence of any brand associations in consumers’ minds. In low involvement decision settings, a minimum level of brand awareness may be sufficient for the choice to be final. Awareness can also influence consumer decision making by affecting brand associations that form the brand image (Keller1998)

February 4th, 2023

Veet Promotion Campaign

To better understand the market and shape the key marketing problem, we conducted primary research to find out the general trends of hair removal among women in Singapore. From this we found a significant result of women in Singapore favouring razors over cream due to the main reason convenience. As such, the report seeks to explore different promotional methods that would allow us to help these heavy razor users to overcome their misconceptions of cream being inconvenient and subsequently to trial Veet® hair removal cream.

The promotional campaign incorporates intergrated marketing communications and features efforts including sampling, couponing, talks, and point-of-purchase displays, featured articles on blogs, mobile advertising, trade promotions and tie-in promotions. All in all, we hope that the campaign will successfully expose more consumers to Veet® hair removal cream samples, convert them into Veet® users and ultimately increase sales for Veet® .

Our overall ROMI sees a negative figure due to costs incurred from our sampling program but CLV is strong at 107 percent. Section Two: Situation Analysis 2A. Depilatory Industry The depilatories industry in Singapore is a steadily growing one, experiencing a 4% growth in 2009 to reach almost $4 million in total sales. Razors and blades for women are the fastest growing depilatories followed by hair removal creams. Depilatories (or hair removal products that remove hair to the level of the skin) include razors, shavers, creams, bleaches and pre-shaves.

Currently, international manufacturers Procter & Gamble (S) Pte Ltd and Reckitt Benckiser (S) Pte Ltd have found dominance in the Singapore depilatories market with their popular brands Gillette and Veet® ®. However, with the increasing awareness of epilators (or hair removal products that remove the entire hair from the root), many women in Singapore are also turning to these methods, including the use of wax strips, epilators and lasers. 2B. Company & Brand History Company background Veet® was first launched under the brand name, Neet, in Canada in 1901.

It was later bought by Reckitt Benckiser Pte Ltd in 1960 and has since been sold in nearly 200 countries worldwide. Reckitt Benckiser is a British global consumer goods company, making and marketing household, personal and healthcare products. The company’s strategy is to have a highly-focused portfolio concentrating on its 17 Powerbrands which contributes to 62% of its net revenues in 2008. Veet® ®, one of its 17 most profitable and recognised brands, has two major products, namely hair removal creams and wax strips. Target market

Veet® ®’s current target market consists of young female professionals and students aged 16 – 35 who are cost-conscious and seek convenience. Some may even be apprehensive of pain. This includes both first-timers who are seeking but have not yet tried hair removal products and also existing users of alternative hair removal products such as shavers and epilators. 2C. Marketing Mix Adopted by Veet® ® Veet® has used the following marketing mix to develop a strong brand recognition, as well as competing for leadership position in the depilatory industry. Product Veet® promises smooth, glowing skin in just 3 minutes.

The hair removal cream/gel works by using an active ingredient to dissolve the hair and the specially designed Perfect Touch spatula enables quick removal of the cream for a smooth and long-lasting finish. The wax strips removes the hair shaft from the root by the mechanical action of removing the strip from the skin, comes in a 20s box. Place Veet® is mass-marketed to Health & Beauty stores (Watsons, Guardian and Unity) and supermarket chains (NTUC Fairprice, Cold Storage, Shop N Save, Carrefour and Giant). It is also available online via the supermarket chain’s online shopping service. Price

Prices of Veet® ranges from $8. 45 for a 100gram hair remover cream to $17. 20 for a 150ml hair remover gel. The Veet ® wax strips (20s) are priced at $12. 90. Promotion In 2007 and 2008, Veet® organized the Miss Veet® Standout Challenge which selected 10 finalists to compete for the crowning through their catwalk and Q&A skills where notable personalities including local bloggers were guest judges. Brand Characteristics * Brand image: The product with its use of soothing colours and graphics of nature communicates an image of natural well being which appeals to the brand’s core customers – women. Brand personality: Veet® relates to the personality of elegant, sensual, graceful and beauty. * Brand equity: The 3 green leaves on the Veet® logo and the use of floral graphics on the product elude a natural feel to users. 2D. Internal Analysis for Veet® ® Veet® Strengths Strong brand presence in Singapore market Procter & Gamble (S) Pte Ltd that manufacture Gillette series of razor brands and Reckitt Benckiser (S) Pte Ltd that manufacture Veet® are the dominance brands in the market. Consumers trusted the brands as they provided relative good hair removing results.

Strong brand equity allows Veet® s to use sales promotion to build competition barriers that deter consumers from using private labels. Veet® removing cream has smoother result as compared to other razors and shavers Clearly, we know the numerous side effects of using razors and shavers. Firstly, cuts happen when blade movement is perpendicular to the blade’s cutting axis. Following on, shaving of hair has been know for causing Hirsutism, a condition in which shaving certain parts of the body hair will result in hair stubbles and accelerates process of hair growth, causing a greater density of hair.

Razors and shavers manufacturers through the years have been innovating new razor design to mitigate the problems but are unable to eradicate the shaving aftermath. By using Veet® remover cream, consumers avoid the risk of razor cuts, while growth hairs become finer. Veet® remover cream contains moisturizing content that allows users to remove and moisture their skin at the same time. Veet® dominates market share for hair removal cream Referring to appendix 456, the depilatories environment in Singapore is mainly dominated by razors and shavers brand (portions highlighted in orange).

Following 53. 3% of the market share dominated by razors and shavers brands, Veet® covers the next prominent portion of the market share (33. 6%). This proves that the next preferred depilatories after shaving is removal cream and/or waxing strips; and this market is primarily dominated by Veet® . In terms of intratype competition, Veet® faces weak competition from its rivalry brands, namely Nair removal cream, Marzena wax strip and other smaller brands that are currently sold in supermarkets and personal hygiene stores.

Veet® ’s high market shares also correspond to the net worth of the brand viewed by retailers. This implies that Veet® distribution network, more specifically retailers, are more willing to cooperate with Veet® in its upcoming sale promotion – since Veet® ’s promotion will increase stock turnovers for the retailers. Veet® Weaknesses Potential target market low expectation about Veet® performance As highlighted in pointer three (3), consumers are more incline to use razors and shavers as they place focus on convenience when choosing depilatories.

Consumers associate Veet® with inconvenience as they have to apply the removal cream on intended areas and wait for six (6) minutes before washing the chemical away. This lengthy process as compared to shaving tends to discourage consumers from buying them. However, Veet® ’s previous advertising campaign attempted to change consumer’s belief about Veet® being an inconvenient product. The advertising campaign also aimed to change consumer’s focus on convenience to place heavier importance on the results of hair removing. Wide deviation in user’s review about Veet® performance

Raise of social media importance will affect potential consumer’s expectation towards a brand and ultimately, affecting the consumer’s decision to purchase the brand. As a consumer engages in information search, it demonstrates her engagement with the brand in the HEM model. A search through users’ reviews in social media review centre explain that there is a huge different between the users’ rating. Some users rated Veet® one (1) star as the brand did not remove their body hair effectively and it causes red chemical burns.

Fortunately the bad ratings are neutralized as other users rate Veet® five (5) stars as they love the product for being simple and easy to use. More importantly they love the brand because it produces better hair removing result than razors and shavers while not leaving chemical irritation on their skin. The two vast differences in users rating thus imply that potential customers still have to rely on other forms of peripheral cues to evaluate their product choices. Sales promotion will help to attract a portion of this market where consumers eventually have to purchase and experience hair removal results by themselves. E. External Analysis for Veet® Consumer Evaluation Primary Research Method A primary research was conducted through an online questionnaire (Appendix 1) with one hundred women aging between 16 year and 35 year old. Through the survey, it will help us to gain understanding about target market’s depilatory products usage behavior and motivation. Veet® Opportunity Veet ® has relatively high brand awareness (Appendix 2A) According to survey results, Veet ® products have high brand awareness. Consumers are able to recognize the product category that Veet® belongs.

With the high brand awareness, this shows that advertising efforts are showing positive results in the market. Market Share between Razor Market and Veet ® Market – On Par (Appendix 2B, 2C, 2D, 2E) Majority of Veet® target market have already performed some form of hair removal procedure as they are image conscious and are concern about how others view them if they appear to be untidy. Currently 18% of our respondents have not engaged in hair removal procedure and a significant portion of this group would either consider or may not do hair removal in the next three to six months period.

This highlights that our promotional campaign should not direct at this group of consumers, as sale promotion is unlikely to change a consumer’s behavior. More advertising instead of sale promotion should be engaged to encourage this group of consumer to start removing hair through Veet ® products. With the remaining 82% of the market that has started removing body hair, we learnt that that is an equal market share between Razor products and hair removal cream products. As covered previously, Veet ® is the leader in the hair removal cream industry; therefore we can assume that Veet® has a market share of 34%.

More than half of our respondents who are using razors mainly are very likely to try Veet® given that there is an attractive sale promotion campaign. With a higher perceive value, there is high potential to convert a portion of the razor users instead of non-hair removal users, to start using / trying Veet® products. Veet® Threats Key Performance Factor: Convenience (Appendix 2F) Consumers today are leading increasingly hectic lifestyles and these cause them to regard convenience as the key factor when choosing depilatory products.

Consequently razors and blades continued to remain popular among consumers commanding a combine market share of around 40 percent in 2009 with Gillette Venus leading the pack taking 75 percent of the razor market. In addition, as consumers become more sophisticated, they are turning to products that promised a cleaner shave and even opted for products with enhanced functions like moisturizing effect or catered to sensitive skin. This explains why consumers are trading up other depilatories for Veet® air removal cream which sees it clinching the top position with nearly 34 percent of the depilatory market share. However, there is still a large part of consumers who are still unaware of the convenience in using Veet® which is well reflected in our primary research. We saw that 70 percent of the surveyed razor users have never use Veet® before and hence have no knowledge about its convenience. Strong Price Competition from other Razor Brands The relatively low price of the Bic Soleil Shimmer Clic compared to other brands saw the fastest growth in 2009.

We attributed this trend to the slowing down of the economy last year. The treat is not high since the sophistication and affluence of consumers would invest in a more functional depilatory with the recovery of the economy. Summarized SWOT Analysis Below is a SWOT diagram summarizing Veet® ®’s internal and external analysis: Section Three: Targeting, Positioning, Objectives Setting, Budgeting 3A. Key Marketing Problem From our situation analysis, it is clear that while there is high awareness level for Veet® hair removal cream.

Being a market leader in the depilatories, Veet® has generated adequate awareness for its hair removing products. However, Veet® must compete mainly with razor product brands such as Gillette. The main threat that is stopping Veet®’s growth is that target market do not perceive Veet® as convenience as razors. There is a need for our campaign to address this misconception about Veet® ®, and to further strengthen Veet® positioning with the product benefit that razor product cannot achieve- benefit such bladeless solution to stubble free skin.

Overall, the management team of Veet® wants to find out: “What should be changed about the current marketing efforts to increase the sales of Veet® hair removal cream? ” In our research to help Veet® in this management decision issue, we will be looking into the following marketing research problem: “How can Veet® promote trial of its hair removal cream in the hair removing market through a promotional campaign? ” 3B. Segmentation of the Women’s Depilatories market in Singapore This research segments the women’s depilatories market in Singapore using a behavioural segmentation base.

We have divided the market into several segments according to the frequency of using razors and the frequency of using Veet® hair removal cream, as seen in the perceptual map in Appendix 3. The different segments as follows: 1) The Bladers: Heavy razor users who have never used Veet® hair removal cream before. 2) The Biased: Relatively heavy razor users who use Veet® only on special occasions such as parties. 3) The Balancers/Switchers: Users of both razors and Veet® . These consumers have no loyalty to either method and switch easily. ) The Professionals: High frequency Veet® users who use razors occasionally to ensure better hair removal effect 5) The Cavemen: Non-users of hair removal products. These are hairy ‘monsters’ who have never shaved and also includes those who are ‘hairless’ and do not need to shave. 6) The Un-conventional: Non-users of razors and Veet® but who are users of other hair removal methods such as waxing and lasers. 7) The No Bleeders: Our Veet® lovers. 3C. Our Target Market Out of the different segments, we have decided to select ‘The Bladers’ as our target market for Veet® hair removal cream.

This is primarily due to the relative ease of conversions of ‘The Bladers’ into users of Veet® hair removal cream, as compared to ‘The Cavemen’ who are non-users of hair removal products. ‘The Bladers’ already have a desire to remove hair, whereas “The Cavemen” do not even see a need to remove hair. This was based on our survey results, where we found out that there is quite a low percentage, 18%, of non-users who are willing to use hair removal products in the first place (Appendix 2D).

However, there is a much more optimistic percentage, 58%, of current users of shavers who are likely or very likely to try hair removal creams since they already have a desire to remove body hair (Appendix 2E). Moreover, the market size for current users of razors is 32. 8% (Appendix 2C) while that of current non-users of hair removal products is only 18% (Appendix 2B). With a larger market, there is a greater potential to tap upon in the current market for users of razors. In addition, we did a targeting specified by personification for ‘The Bladers’.

This person would represent the typical non-Veet® user whom we hope to convert into a Veet® user. Her profile is seen below: * Name: Rachel Quek * Age: 27 * Occupation: Marketing Executive * Hobby: Loves shopping, online shopping, going to the beach, clubbing, social networking * Personality: Fun, image-conscious, highly regards others’ opinions on her appearance, has a fear for pain * Shopping behavior for personal product: Loves trying products before deciding to buy * Current hair removal method: Uses Gillette Venus because of convenience * Monthly expenses on personal grooming: $300 Time spent on personal grooming daily: 2 hours on weekdays, 3 hours on weekends * Dressing habits: Frequently in dresses and above-knee skirts 3D. Positioning Statement Our positioning statement is: For women in Singapore who currently shave, who now seek a painless, smoother & longer-lasting hair removing effect; Veet® is a bladeless hair removal product that moisturizes your skin – a total beauty experience that no woman should miss out on. 3E. Objective Setting

There is already high awareness of Veet® hair removal cream in the women’s depilatories market in Singapore, with 95% of the market being aware of it (Appendix 2A). Yet, only 27. 9% of the market uses it (Appendix 2C). Through the implementation of our one-year campaign, we hope to be able to see an increase in this market share as we move ‘The Bladers’ up the Hierarchy of Marketing Communication Effects (HEM) from the ‘Awareness’ to ‘Trial’ stage (Appendix 4). However, ‘The Bladers’ currently either have no expectations or have a bad expectation of Veet® where they think that it is inconvenient to use (Appendix 2F).

For those who have no expectations, we want to push them to try our product through samples, creating expectations of convenience and pushing them to eventually buy since they have the assurance from trying the product first hand. For those who have poor expectations of the product being inconvenient, we need to give them samples to change this attitude and also further push them to buy our product. We have thus established our campaign objectives below: 1) To see 40 percent of ‘The Bladers’ being exposed to our campaign 2)

To have 40 percent coupon redemption among all who received our sample and coupon 3) To achieve 20 percent of our target segment purchasing our tie-in promotion 4) To see 30 percent of the ‘The Bladers’ joining our contest 5) To collect a consumer database from our couponing system for Veet® ’s future promotional campaigns 3F. Budgeting We will be employing the objective and task method of budgeting so that we can clearly specific what role each component of the marcom campaign satisfy for the brand and set the budget accordingly.

The overall campaign budget will comprise fully of promotional dollars. The rationale of this decision links back to our objective of moving ‘The Bladers’ up the HEM from awareness to trial and therefore a heavy focus on promotion will be a better plan. We did not specifically allocated portion of the budget for media and public relation (PR) spending since they consist of only a small percentage of the budget. They are still present in the campaign but act as a support for the main promotional campaign. Therefore they will be accounted under the under the promotion budget instead.

That explains a 100 percent allocation of the S$400,000 budget to promotion. Promotion Budget Breakdown We strongly believe that it is crucial for our target segment to test our product before they can move from being ‘aware’ to eventually product ‘trial’. To accomplish this objective, the majority of the promotion budget will be devoted to heavy sampling (50 percent of promotion budget or S$200,000). A self created event will constitute one of the channels for distributing our samples and it will cost us S$10,000. We would like to incentivize our consumers as well and therefore 7. percent or S$30,000 will be allocated to a couponing exercise which will overlay sampling. A tie-in promotion with a complementary product will follow so as to induce purchase and further incentivize our consumers. This component will be given S$50,000 of the promotion budget. An online contest will also be running throughout the campaign but due to the relatively low investment involved, it will be weighted at 1. 25 percent only. S$80,000 will also be budgeting for trade allowances for our partner retailer’s involvement in our full campaign as well as slotting allowances given for erecting our point-of-purchase (POP).

Our POP will be given S$15,000 in the budget. The remainder of the promotion budget will be assigned to media and PR efforts to drive the promotional campaign. (Please refer to Appendix 5 for full budget allocation) Section Four: Our Promotional Campaign 4A: Allocation of efforts in the overall Integrated Marketing Communication Campaign Advertising – (1% effort) Through our situation analysis, we learnt that Veet® has very high level of brand awareness, and this is mainly pushed by Veet® advertising efforts.

In addition, the target market has relatively little target consumers who have not started doing hair removing procedure, advertising investment will not be effective as the market coverage is significantly lower as compared to putting the investment in converting current razor users. Lastly, given our campaign objective of moving ‘The Bladders’ from brand awareness level to trial level, advertising will not be effective to move the target consumers into actions – by getting them to start trying Veet® product.

However, we will engage trade promotion tools by getting our partner retailer to advertise Veet® sale promotion to its customers. Personal Selling and Public Relations – (1% effort) As Veet® belongs to the FMCG (Fast Moving Consumer Goods) product category, it would unwise for our campaign to invest in sales people to encourage consumers to purchase Veet® products. Moreover, hair removal procedure is considered a private personal grooming process. Therefore it is difficult to involve ‘The Bladders’ in an open environment for a hair removal demonstration.

Little investment will be put into public relations as majority of the target market are aware of Veet® usage. Direct Marketing – (5% effort) In our campaign, we will be adopting mobile advertising. The customer database will be collected through consumer’s opt in option when they send a SMS (Short Message Service) to obtain a SMS coupon. With the customer details collected, we will direct advertising messages via mobile services in the subsequent promotion campaign. Sales Promotion – (90%) Majority of our investment and efforts will be invested on Sale Promotion.

Sale promotion will be the center of our campaign with the remaining IMC tools acting as a supporting role to communicate about the sales promotion to ‘The Bladders’. As consumers have the perception that Veet® product is not as convenience as razors, the campaign will focus on changing this misperception by allowing ‘The Bladders’ to personally experience Veet® product. In addition, ‘The Bladders’ will experience the smoother hair removal effects (stubble free), this will help to strengthen Veet® ’s positioning. Shaping user experiences will be done primarily through sampling.

With user experience appropriately shaped, couponing exercise and attractive contest incentives will be used to spur ‘The bladders’ to start trying Veet® product. With the understanding of how investment will be made in this campaign, following is our proposed promotional campaign for Veet® . 4B: Our promotional campaign for Veet® Overview of campaign Our promotional campaign will be primarily revolving around bringing across the mindset of Veet® hair removal cream as one that is convenient coupled with a plus point of better hair removal results to our target group ‘The Bladers’.

The entire promotional campaign duration will be 12 months, and staged in three phases: (i) Feeling the stubbles, (ii) Long-lasting smoothness and (iii) The Veet® Contest. Phase 1: Feeling the Stubbles Objective: Expose ‘The Bladers’ to our campaign and drive word-of-mouth As we are targeting ‘The Bladers’ who are already experienced customers in the hair removing market, they will be less likely to take notice of the convenience and added benefits of Veet® if it is done through the mass media channels like commercials, ads or any other imagery that is forced upon them.

Thus in ‘Feeling the Stubbles’, we will seek to first roll out the promotional campaign in a subtle manner with heavy sampling also known as tryvertising, by conveying the intended messages based on their experience with our product and also concurrently incorporate mobile couponing as a piggyback to that to have a best reach to our target group. Diagram 2: Sample & Couponing Sketch The sample we will be giving out is a 30ml Veet® hair removal cream tube that comes with the brand’s signature perfect touch spatula and tied together with the tube is a double sided information card.

On the front side of the information card, it is a surface full of protruded patterns that resemble the stubbles after shaving with a razor following a tagline of ‘Feeling the Stubbles? ’ And on the flipside, it will feature our tagline of ‘Stubbles-Free in 3 minutes’ following our couponing exercise. Diagram 3: Mobile Couponing Process The recipients of the sample will be required to text in to our number with their name and identification number for a mobile coupon.

The mobile coupon will then entitle them to a 10 percent discount on a full sized Veet® hair removal cream at any of the stores of our partner retailer and also a contest entry chance. Each mobile coupon will come with a uniquely coded two-dimensional Quick Response (QR) code for tracking the redemption levels and from the codes to track which the efficiency of the sampling mediums deployed. The retailer will be incentivized with every mobile coupon redeemed. Sampling Mediums

In this heavy sampling exercise, we will be distributing our samples through three sampling mediums namely digital media platform, collaborative events and through our partnering retailer. The three mediums are The Sample Store, Corporate Luncheon and in the stores of Watsons. The Sample Store (www. thesamplestore. sg) is a local platform that distributes product samples online. Since its launch in 2008 it has since built a huge database of members both on its website and facebook fansite and still growing its popularity as many recognize it as one that operates on unbiased reviews that are given by members.

Members who redeem any samples will receive them via mail. Other than having our samples be placed on the site, we will also want to minimize or prevent any possible clutter of the many different brands and products on The Sample Store. We will be working with the team over there with three additional features. First, we will have our product featured in The Sample Store’s blog as a new sample which members will be able to access directly to this page or link through the main site.

Currently the site’s blog maintenance team has an updates indicator of how recent is the blog updated for the ease of members to track new entries. On the blog entry, there will be a link for the readers to direct them to page to grab our sample. Hello Rachel Veet® Hair Removal Cream Sponsored Link The Sample Store Blog The Sample Store product placement Secondly on the actual product placement page, we will also be having our product be featured in the section of ‘Sponsored Link’ to further minimize the brand and product clutter in our sampling exercise.

Be it on the main page of ‘Samples’ or when members scroll through the pages of samples, the ‘Sponsored Link’ function will come in handy as it is a permanent display on the top of every page that effectively maximizes the chance of reach and redemption. Thirdly, we will also put up a special request to have our product placement be strategically located beside Gillette or any other razor products so as to have a better chance in reaching our target group ‘The Bladers’.

Veet® Corporate Luncheon is a series of collaborative events with the National Skin Centre’s Health Talk aiming at bringing these talks to the premises of 48 companies. These series of lunch talks will be done in a form of registered events in which employees register with the human resources department and there will be a seat limit capped at 50 for each session. During each hourly session, there will be a 40 minutes skin talk by the National Skin Centre’s dermatologists.

Following up will be a 20 minutes product talk and interactive demonstration session by Veet® whereby the models for demonstration will be picked from the audience. Thereafter, the dermatologists will wrap up the entire talk by testing the skin hydration levels of the models after using Veet® hair removal cream product. Lunch will also be catered to encourage participants of the talk to clear any doubts regarding Veet® ’s products while handling out Veet® ’s samples. Sampling @ Watsons is the main highlight of the three sampling exercises as it is a highly targeted sampling exercise in conjunction with the ones mentioned above.

From our primary research it shows that when ‘The Bladers’ want to make any purchase regarding personal care products, Watsons will be their first choice. Thus, to be in line with that, we will be making Watsons our exclusive partner for distributing Veet® ’s samples across Watsons’ good scalability of 101 outlets islandwide. Also derived from our primary research, we found that there are some complementary products that the razor-users are most likely to use before, during or after shaving. Diagram 6: Determinants of scanner-delivered sampling

With this information, we have designed a scanner-delivered sampling exercise whereby once any of these 6 items (body lotion, tights, sunblock, deodorant, razors and shaving aids) is purchased, a Veet® sample will be automatically be presented to the customer. To gain retailer’s agreement and cooperation, a heads-on competition with other razors and shaving aids companies will be eliminated by having these two items as an exception. Only with purchase of other items on top of razors and shaving aids, will the customer be entitled the Veet® sample.

In addition to the scanner-delivered sampling conducted, we will be purchasing retail spaces at Watsons to have a point-of-purchase display at the storefront of Watsons’ outlets. This will allow us to cast a bigger net to reach and expose our target group ‘The Bladers’ to our campaign should they coincidentally fall out of the sampling determinants during our campaign period. Diagram 7: Point-of-Purchase Display The display will be in line with the sampling exercise, seeking to convey the message of convenience being ‘Stubbles-free in 3 minutes’.

Wobblers will be attached to the fixture indicating information including the mobile couponing exercise and contest entry chance. The entire Phase 1 sampling exercise will be held in a 4 months period, with the exception of the featured article on The Sample Store’s blog which can be posted up for the entire campaign. Couponing and redemption exercises will be conducted for a 5 months period. Diagram 8: Phase 1‘Feeling the Stubbles’ timeline 4B. Phase 2: Long-lasting Smoothness Objective: Build brand associations of better hair removing effect and experience After exposing our target group to the campaign in Phase 1, Phase ‘Long-lasting Smoothness’ will seek to build brand associations of Veet® as one that provides a the total hair removing effect and experience. To be in line with that, we will be partnering with Vaseline a brand that is known for its long heritage of body lotions and the effectiveness of hydrating skin, bringing a great boost to both brands when seen as complementary products. Together, we will be offering a tie-in promotion bundle which includes a 400ml Vaseline body lotion and 100ml Veet® Hair Removal Cream.

Diagram 9: Vaseline and Veet® bundle Pricing of the bundle will be at $15. 90, strategically seeking it to be lower than a separate purchase of either items and also importantly be lower than that of a combined purchase of razors or razor refills and Vaseline body lotion altogether. Based on the respondents of Phase 1, we will be deploying a closed-loop marketing tactic whereby we will be sending text messages to the people who redeemed our coupon in Phase 1 to inform them of the tie-in promotion.

Similar to the point-of purchase display in Phase 1, we will be purchasing retail spaces at Watsons to have a point-of-purchase display at the storefront of Watsons’ outlets in addition to the closed-loop marketing text messaging. This will allow us to cast a bigger net to build brand associations of a total hair removing effect and experience to our target group ‘The Bladers’ should they not be in time to redeem our coupons during our couponing period. The same point-of-purchase fixture will be used from the previous occasion to lower costs.

Wobblers will be attached to the fixture will be changed now to indicating information Diagram 10:Bundle Point-of-Purchase Display including the 15 percent savings with the special bundle pricing drawing comparison with its usual price, reinforcement of a total experience of long-lasting smoothness and a contest entry chance. Bundle packages will also be concurrently placed on Vaseline’s shelves. Cards regarding contest information will be slotted in the bundles. The entire Phase 2 tie-in promotion will be held in a 4 months period after the sampling and couponing exercise of Phase 1.

Diagram 11: Phase 2‘Long-lasting Smoothness’ timeline 4C. Phase 3: The Veet® Contest Objective: Drive trial and traffic to Veet® Singapore Facebook page. Build brand excitement and buzz Phase 3 of the campaign will act as a overlay campaign to both Phase 1 and Phase 2. To effectively drive product trial and building brand excitement, a Veet® Singapore Facebook fanpage will be set up as currently Veet® do not have any adoption of social media locally. Diagram 12: Contest Card Sketch

When the recipients of the samples make a purchase using the mobile coupon in Phase 1, purchase a bundle in Phase 2 or making a regular purchase after the 2 phases, the retailer will be handing out contest cards for every purchase. On the flipside of the contest card, it will visibly tell recipients that they have won one chance to ‘The Veet® Contest’ by entering the scratch code on the contest card on Veet® Singapore’s Facebook fanpage. Every additional purchase will entitle them an additional chance in becoming the grand winners of the contest.

Diagram 13: Veet® Singapore Facebook fanpage In addition, by liking Veet® ’s page will entitle the contest participants 5 more winning chances to the contest. The top 3 winners of the contest will walk away with a $500 Watsons Gift Vouchers each and there will also be 5 winners who will walk away with a year’s supply of Veet® hair removal cream as consolation prizes. Such information will also be detailed on the Facebook fanpage. At the end of the entire contest, announcement of contest winners will also be conducted via the Facebook fanpage.

Phase 3 will be held as a supporting role in the entire 12 months period, concurrently with Phase 1 and 2. Diagram 14: Phase 3‘The Veet® Contest’ timeline Section Five: Conclusion 5A. ROMI and CLV (Appendix 6) Retail price of Veet® hair removal cream is at S$10. Our profit margin for the product is at 40 percent or S$4. We will take annual discount rate to be at 12 percent and this will translate to 1 percent monthly discount rate. We are looking at a three tiers conversion model with light users purchasing once in two months, medium users once a month and heavy users twice a month. 1. Phase 1

The sampling exercise overlay with couponing will see an estimated 40 percent conversion rate in total out of the sample/coupon given out over the four months. Of the 12,500 potential converts per month, we will be looking at 4 percent becoming heavy users, 16 percent medium users and 80 percent light users. This will transit to a monthly profit of S$32,000 but a negative return of marketing investment (ROMI) of 56 percent. However, we are projecting a relatively high constant retention rate of the converts at 90 percent for heavy users, 85 percent for medium users and 80 percent for light users.

Therefore this will give us a positive customer lifetime value (CLV) of 106 percent. 2. Phase 2 Our tie-in promotion with a moisturizer brand will see a conversion rate of 20 percent. However we foresee that three-quarter of them will be those who used the coupon in Phase 1 and are returning customers. Therefore we are looking at 1,560 new converts per month from the tie-in promotion. Although we will have a negative ROMI of 53 percent in this phase, we will be looking at the same retention rate for all three conversion segment hence getting a positive CLV of 124 percent. . Phase 3 The Veet® contest will run from the start to the end of the one year campaign and we are expecting purely new converts (not from Phase 1 and 2) only from those who picked up a contest form from our POP at our partner retailers. Since we foresee that a percentage of them would be purchasing for the contest, we lowered their retention rate to 80 percent, 60 percent and 40 percent for the heavy, medium and light converts respectively.

Given that our main intention of the contest is to create hype for the campaign and rewarding the real converts who purchase through Phase 1 and 2, we are expecting to see only 310 converts per month which will transit to a slightly positive ROMI of 5. 3 percent and only 25 percent in CLV. 4. Overall The overall campaign will see a conversion of 14,730 users per month and a total of close to 60,000 converts throughout the full one year campaign. Although we will be getting a negative overall ROMI of 55 percent and a slightly high average acquisition cost of S$5. 74 we will be achieving a strong CLV of 107 percent. . Best and Worst Case The best case scenario will see us having 25 percent more conversions from Phase 1, 50 percent more from Phase 2 and Phase 3 and this will increase the ROMI to -44 percent and CLV to 162 percent.

As for the worst case scenario, it will be the reverse having 25 percent lesser in conversions for Phase 1 and 50 percent lesser for Phase 2 and 3 will see us having a negative CLV for both Phase 2 and 3 but an overall CLV of 66 percent. ROMI will stand at negative 64 percent. 5B. Evaluation of Campaign The success of our campaign will depend on meeting our pre-set objectives. To have 40 percent coupon redemption among all who received our sample and coupon * To collect a consumer database from our couponing system for Veet® ’s future promotional campaigns We can easily track this by tabulating the number of request for the mobile coupons. As the distribution of the samples with the coupons are highly targeted at ‘The Bladers’, we can foresee near to 100 percent of the mobile coupon being redeemed by our target segment. As for the database, when our consumer sends in a message requesting for the mobile coupon, we would locked in their numbers and consolidate it into a database.

This database will be straightaway put to use in Phase 2 of our campaign where we will send them a message informing about the tie-in promotion being offered in our partner retailers. * To achieve 20 percent of our target segment purchasing our tie-in promotion * To see 30 percent of the ‘The Bladers’ joining our contest The numbers for these two objectives can be tracked when our target segment sign up for the contest. When entering the contest on Facebook, they will be asked a simple question regarding when they were first exposed to the product.

If they choose either through the tie-in promotion or through the sample with coupon distributed, we would know that they are our target segment ‘The Bladders’. As the contest card comes with a unique code for entering into the contest, a consolidation of the unique codes keyed in for each Phase of the campaign will indicate to us the number of our target segment who participated in the online contest. * To see 40 percent of ‘The Bladers’ being exposed to our campaign The number of samples given out, coupons redeem and contest details will give us a rough estimate to how many of our targeted segment was in face exposed to our campaign.

8| What is your reason for not considering using Veet® to remove body hair? | (Open ended answer)| About Yourselves| | Age| 11 – 1515- 2021 – 2526 – 3031 – 3536 – 4041 – 4546 – 5051 – 55| | Occupation| (Open ended answer)| Amount of time spent on personal grooming daily (Weekday)| | | Amount of time spent on personal grooming daily (Weekend)| | | Amount of money spent on personal grooming monthly| | | Where do you usually purchase personal grooming products? | NTUCGuidanceWatsonVenusProvision ShopsGiantShop and SaveThe Market PlaceOthers (Pls Specify:________________)| | What are some products that you would usually purchase with hair removal product? | (open ended answers)| Appendix 2: Descriptive Survey Results (Important insights) – Total Number of Respondents: 30 Appendix 2A: Graph Showing Awareness Level of Veet Hair Removal Cream 1.

Have you heard of Veet Hair Removal Cream? Appendix 2B: Graph Showing market doing hair removal 2. Have you done hair removal before? Appendix 2C: Graph Showing Type of Hair Removal Method Used by Women 3. (For the 82% of women who have removed hair before) which type of hair removal method do you use? Appendix 2D: Graph Showing Percentage of Non-Users on Whether They Will Ever Do Hair Removal 4. Do you think you will ever do hair removal in the next three to six months period? Appendix 2E: Graph Showing Percentage of Razor Users on Whether They Will Use Veet 5. For current razor users) Will you use try using Veet hair removal cream? Appendix 2F: Summary of Reasons of Current Razor Users for Not Wanting to Try Veet 6. (For those who are unlikely to try Veet hair removal cream in Q5) Why not? * Inconvenient (Most responses) * I am unsure of the effects of using cream * May not remove all the hair as effectively as razors * Using cream makes my skin dry * More expensive * I am used to using razors already Appendix 3: Segmentation Map of the Women’s Depilatories Market in Singapore

Appendix 4: Graph Showing How ‘The Bladers’ Will Move Up the Hierarchy of Marketing Communication Effects (HEM) Appendix 5: Budget Allocation Appendix 6: ROMI and CLV Bibliography Veet Hair Removal Cream Review, retrieved on 19 October 2010, retrieved from http://www. reviewcentre. com/reviews74276. html Veet Bladeless Razor Review, retrieved on 19 October 2010, retrieved from http://www. viewpoints. com/Veet-Rasera-Bladeless-Razor-reviews Depilatory Industry Overview in Singapore, Euromonitor International: Country Sector Briefting, June 2010, retrieved on 22 October 2010

February 4th, 2023

Brand-switching behaviour

Table of contents

Executive summary

In a modern business world product maker and consumer are playing an important role. They cannot be seperated each other in every business activities. Nowdays people are facing free global trading which required producer to be innovative, creative, and competitive in every aspect. They must aligable to attract their consumer to be loyal to their product. The responsibility of the producer is not only creating some products, in fact, they have to make sure that every single product that they have created must be competitive compare with others by not forgetting about the safety aspect of their product itselfto the market.

On the other hand as a consumer, we have a right to choose which product that are suitable for us in order to fullfil our demands. Besides that, as a consumer we also are required to understand and know the information details of the product that we are going to purchase. However, both parties are different that make them cannot be seperated. Producer are required to be more creative by producing a good product and the other side consumers are required to be more wisely choosing a good product.

The best issue in order to interrclation between those 2(two) parties is brand-switching of SUV cars in Indonesia that I am going to emphasize on. Acknowledgements Before I begin to write my dissertation, I would like to express the deepest acknowledgement to God (Allah S. W. T) and all the people who support me finishing all the requirements to settle my master program in International Business. Firstly, God have giving me a strength to be patient to solve all the problems that I have faced during the class period. Besides that, I also believe He will never stop to give me a strong spirit to finish my dissertation.

Secondly, parents are important for me. They are my best supporter in my live and I do believe without their attention, I will never can finish my master study. Thirdly is my respective supervisor Mr. Alan Go who always give me a best way and an amazing idea how to finish my dissertation nicely. And last but not least, I would like to thank to my special Fiance who always beside me to cheer me up when I lose my idea. In addition, I believe that by doing my dissertation is my chance to implement all the knowledges that I have studied and give an explaination to what I ave understood.

Introduction

As per the American Marketing Association, a brand can be defined as “a name, term, sign, symbol, or design, or a combination of them, intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors” (Kotler, 1995).

Aaker (1995) defines a brand on different levels rather than taking it as a physical product like brand attributes, symbols, brand-consumer relationships, benefits of self-expression, customer profiles, associations with the culture of the country of origin, and corporate identity. In simple terms a brand can be defined as a characteristic feature that distinguishes the goods and services of a particular marketer from the rest of the marketers. The earliest signs of branding was seen in Europe where crafts people used to put trademarks on their products to protect the customers from inferior quality.

Branding has been around for centuries and is a pivotal component of present date marketing with increase in the consciousness level of customers regarding various brands. Brand switching is said to have occurred when a customer using a product of a particular brand changes to product of other brand. Often referred to as brand jumping, it is the process of changing from routine use of one product or brand to steady usage of a different but similar product. For example, a customer goes to a shop and finds that the product of a particular brand he uses daily is not available and takes a similar product from some other brand.

This type of brand switching is temporary. However, brand switching can be long lasting also where a customer changes from the product of a brand to a newer product or brand for longer period of time. This type of brand switching usually occurs in the products that are used for longer durations and where likelihood of switching away is harder like cars. This brand switching is often influenced by the competitiveness among the brands available in the market. Or in other words it may be said that intensity of brand switching would be higher if the degree of competitiveness between the brands is higher.

For last decade automobile industry has seen a big boom and new entrants have entered into the automobile market giving a tough time to consumers while choosing their brand of choice. However, this also brings a lot of benefits to the consumer community. The entry of new car brands into the market further increases the number of options and choices one has in choosing the brand he likes. In this case, consumers have a variety of choice to easily compare different types of options and features available in different cars provided by these available alternative brands and decide on the features, cost etc. . 1Background of the study Currently in Indonesia, other than the car brands that have existed for long like Suzuki, Toyota, Honda, Daihatsu, Mitsubishi, Isuzu, Nissan, and many others; new entrants such as Hyundai, Kia, Proton and many more have also come in into the automobile sector. Based on a survey conducted by GAIKINDO (Association of Indonesian Automotive Industries), the highest market share in automobile sector for Indonesia region is dominated by Honda. Among all other card brands, Honda is considered the most competitive compared to other car brands in Indonesia.

As per the study Honda is ranked first with a market share of 37. 2% while Toyota got the 2nd position with a market share of 28. 4%. In past few years marketers have noticed and reported many changes which have taken place in the market like increased competition and customers’ new preferences.

This severe competition has mostly resulted from product similarity and large numbers of competitive brands in the same market as reported by marketers and researchers. Companies are thus pushed to study this budding intensity of competition by their competitors, and also try to know their customers including both existing as well as prospective buyers. In Indonesian markets also, many changes have been seen in consumers’ behaviors especially in the automobile sector due to the changing lifestyle. Probably, during recent years, one of the most fretful behavioral changes among Indonesian consumers is the mounting eagerness of buying SUVs.

In a company’s perspective customer satisfaction is an important solution to prevent customers from switching brands. Companies are now trying to increase their customer loyalty through different loyalty programs such as loyalty card and membership club in order to maintain their customers and to lure new customers. In the meantime, marketers are trying to find out reasons as to why consumers change brands and how marketing tools like promotional tools and advertisements affect the behavior of consumers’ in choosing a brand.

Statement of problem

For researchers, brand switching has remained a motivating topic in the recent years. Several factors have been studied that influence the growing switching behavior among consumers, among which advertising and promotion have been found as key determinants. The consumers may not change their brand preference immediately from one brand to another, then how and why consumers want to move from one brand to another or why do they just think of moving up to the next alternative is a critical issue for understanding customers’ brand switching behaviour.

And, it is also useful for increasing the effectiveness of marketing communication. In Indonesia, the penetration of new car brands like Hyndai, Proton and others have made the car market become more and more competitive and SUV is a typical product category of automobile industry which is also extremely competitive nowadays. Facing the growing competition, it was necessary to take an insight into Indonesian car market to help marketers find out the ways which would be used to improve the effectiveness of marketing tools.

The reason for choosing SUV to be the research topic was that the competition in SUV segment of car market in Indonesia is extremely intensive and is one of the most competitive markets in Indonesia.

Objectives of the Study

The primary objective of this study was to determine the impact of various external factors on the brand switching behaviour of the Indonesian customers for SUV segment of cars. However, there were two secondary objectives of this study:

To examine the impact of advertising and promotion on brand switching in Indonesian car market.
To study the interaction between advertising/promotion and price-consciousness, and to investigate how customers’ responses to advertising and promotion can be influenced by price consciousness.

Research Questions

Following were some of the questions that this study intended to find answers:

Does Advertising and Promotion have an impact on the consumers’ brand switching behavior?
What is the influence of price consciousness on promotion/advertising and the brand-switching behavior among the consumers of SUV cars in Indonesia?

Significance of the study

Factors influencing brand switching has been an important topic for research as its implications are of enormous significance to the manufacturers. As advertising and promotion have been identified as massive determinants, in addition to some other factors, to explain the brand switching behaviour of the consumers, therefore, the findings of this study will help car manufacturers in deciding upon the level of effort they need to put into promotion and advertising.

Maintaining customers has been of primary importance to most of the companies due to the greater saturated markets. The findings of this study will present some key factors to the car manufacturers to improve customer satisfaction and therefore maintaining the existing ones. The efficacy of advertising and promotion is an essential element for marketers to identify so as to develop the brand consequently and attract more customers. For this purpose, they need to understand the relationship between advertising/promotion and brand switching and the interaction with other important factors.

The reason why customers switch to other brands has not been clearly understood due to a huge number of substitutes nowadays, who provide numerous choices and benefits to the customers. The majority of marketers have been concentrating on finding out the ways of improving the customer satisfaction with the belief that the satisfied customers will not change the brands. It seems logical and reasonable, and the statement that satisfied customers will prevent existing customers to switch to other brands cannot be denied.

However, some studies have also shown that the satisfied customers also switch the brands and therefore we cannot over shade this fact as well. Therefore, marketers are fond of getting inputs on finding out the major reasons of brand switching by applying the marketing tools in perspective of several other factors like demographics, pricing and psychological intuitions. This study therefore has the implications for the car manufacturers of Indonesia on how they must design their advertising/promotional strategies with respect to certain other factors to keep their existing customers and attract the new ones.

The advertising contents and promotional tools used by marketers are not always significantly related with brand switching. This study will help the marketers to identify those tools and contents which they can use in establishing a satisfactory relationship with the customers so as to prevent brand switching in their cars. This research focussed on one aspect of marketing mix elements which influence brand switching, namely advertising/promotion (marketing communication tools), and several other relevant determinants were also tested simultaneously, like the influence of emographic factor, product category, and price consciousness in the Indonesian car sector. The research was conducted under the background of Indonesian Car market, and the focus was on the SUV product category of automobile market. Hopefully, this research would benefit fast moving automobile companies in Indonesian market through their improvement of the effectiveness of their advertising and promotional tools.

Literature review

Brand switching

Brand switching is said to have taken place when an individual or a group of individuals jump from using one brand to another.

This shift can take place due to several reasons like the presence of close substitutes with better benefits in the market place, the sound promotional activities by the competitors and the price wars among various companies within an industry which gives consumers the benefit of choosing among various variants (variety seeking). This phenomenon of variety seeking which gives consumers power to choose has been explained by Menondan Khan (1995). His study explained that switching behavior can result from the availability of several other variants of offers of other similar products.

Mutyalestari (2009) argued that the brand switching may occur due to a certain problem that a user may face from the product that he has been using that makes him to make a move to another one seeking more benefits. Pratikno (2003) declared in general customers switch from one brand to another in case of the products with low involvement characteristic. Customers stop using a particular brand and shift to the other after using one for a particular period of time i. e. it is a post purchase behavior.

According to Purwani and Dharmmesta (2002), the switching behavior of the consumers is not that simple to be backed by the concept of being dissatisfied from one to look for the satisfaction from another. There are certain other factors that include financial and non-financial drivers of the switching behavior certified by the consumers. The main factors that make individuals to stop using one brand and switch to another are: that they perceive that they are getting less benefits to satisfy their needs expected from a particular product called core product problem; that they are isappointed with the services provided to them from the owners of the brand that they hold called augmented product problem; that even if an individual is satisfied from the product or service he is using, he/she may still switch to another brand if he perceives that it can provide additional benefits to him/her and that the consumer of a product wants to move from using that product and is looking to try something else and this concept is called variety seeking (www. mars-e. com). Some car buyers switch from one brand to another at trade in time, whereas others display consistency of choice from purchase to purchase.

On that decision, whether to remain loyal to the previously purchased make or switch brands, hangs the fortune of automobile manufacturers. But the observed decision has its genesis much earlier in a process that incudes the buyer’s prior experience, product knowledge, satisfaction, media search, consideration-set formation, and retailler search. According to Lin (2003 444) the behaviour of consumers switching brands can be seen from the following characteristics:

Brand loyalty is low due to the absence of product differentiation that makes consumers evaluate brand and use the brand because of other factors.
Involvement is Consumer knowledge about the cost, effort and experience when buying consumer products for the future prospects such as product mix, quality, know-how to use, fulfilling demand and price information.
Customer satisfaction is satisfaction with services that can respond to the needs of consumers and consumer demand as the popularity of the brand, product packaging, service attitude and ease of purchase.

The Switching behavior can be due a variety of various intrinsic and extrinsic factors. The factors can be psychological factors like curiosity, mental makeup of customers . The various other factors can be Advertisement and other promotional tools. Modern day marketers understand the importance of implementing both individual and organizational promotional incentives. Sales promotion activities have been seen as an important factor that plays a significant part in the switching to other brands. The various sales promotion tools implemented by the companies are price discounts, Coupons, Warranties and Guarantees.

Marketers have also recognized the importance of reducing cognitive dissonance which comes into the mind of customers after the purchase is made. The need is to reduce the doubts that strike the minds of customers after purchase is made by duly communicating with the customers or the customer may switch to some other brand. To view more details on the brand switching, from exploratory research conducted by Keaveney (1995), the factors that can lead to brand switching are as follows:

Pricing category includes all switching behaviour including price, cost, service charge, and penalty.
Inconvenience is discomfort category which includes all instances where the consumer finds the location of customer service, hours of operation, and waiting time.
Core service failure or services encounter failure and response to services failure is due to a failed service not administered properly by the provider.
Competitors’ price promotions, better service, in-store promotion, product promotion, and packaging quality suitable for entry into the variable category competitors.
Ethical problems are critical switching factors where the customer describes the illegal, immoral, unsafe, unhealthy and other behaviours that do not conform to social norms.
Involuntary switching which reflects when consumers will move due to factors beyond the control of consumers and service providers.

Advertising and brand-switching

The relationship between brand switching and advertising has been studied by many researchers and therefore diverse points of views have been presented so far. The influence of advertising on the behaviour of customers before buying a product has been studied by numerous researchers.

Some studies argue that it is necessary to review the stages through which the customers go in response to the advertising before making a purchase because of certain transitional phases through which customers go before the final purchase. Therefore this study divides the review of previous researches conducted in two categories for the better understanding.

Advertising effectiveness

In case of frequently used products, Ehrenberg (2000) argued that the majority of the revenue for the companies comes from the customers who repeat their purchases.

The author also stated that the investigation on the effectiveness of advertising should not be carried out for the purpose of finding out the purchase behaviour of the customers only or the effectiveness of advertisings’ persuasiveness on them, rather it should be carried out to find out the responsiveness of the customers because there can be no such evidence to see the persuasiveness the advertising will lead to in customers. In addition, the study of Ehrenberg (2000) also stated that the reinforcement of the advertising activities may not necessarily produce immediate results but it will be beneficial in the long-term.

The customers can show the reverse switch behaviour by buying back the brands they used to purchase before and can even show the repeat purchase behaviour if the advertising and promotion activities are appropriate. The effectiveness of advertising is mostly measured by the increment in the sales. However, these short term effects are not the complete criteria an advertiser may look for. The longer effects need to be taken into consideration in spite of the fact that it may take too long in most of the cases.

As suggested by the study of Lavidge and Steiner (1961), through sales increment, although we can measure the effectiveness of advertisement in the short run but the long term effects contribute to the majority of the results of an advertisement activity and should not be ignored. Ehrenberg (2000) also supported this concept by stating that the long term effects must not be ignored and the effects can not necessarily be direct. So it is necessary to study both short term and long run effects of an advertising campaign according to Lavidge and Steiner.

The effectiveness of an advertisement cannot be accepted if it fails to achieve its objective. Advertising effectiveness need to be defined clearly as per Beerli and Martin Santana (1999). Their study emphasized on the importance of having a clear objective of advertising. As per the study, the goal of every company is to increase sales but the advertisement goals must be defined separately from business goals to fulfil the main purpose of advertising which is to communicate to the existing and potential customers and pass the necessary information to them.

In simple words, the effectiveness of advertising is said to be high if it successfully achieves its objectives. Therefore, high effectiveness of advertising, is not only reflected by the increment in sales, somewhat advertising effectiveness can be measured on the basis of following three objectives according to Lavidge and Steiner (1961); developing brand awareness and providing product knowledge, creating brand preference and positive feeling, building up trust and stimulating purchase. There are many factors that judge the effectiveness of advertisement simultaneously. The According to the research conducted by Lodish et al. 1995), advertising expenses and sales revenue does not show a strong correlation because several other factors influence simultaneously like brand strategy, diverse product categories and media strategy. Biel and Bridgwater (1990) in their study found that the responsiveness of viewers of the advertisement, the likings and feelings towards the advertisement, has a major role to play in determining the effectiveness of the advertisement particularly for fast moving shopper goods. They stated that the more an advertisement is liked by the viewers, the more effective it will be.

Therefore, to persuade a customer to purchase a product, the companies need to design their advertisement in such a way that it is liked by everyone. Effective advertisement would be therefore explained by the properties of being meaningful and relevant rather than having more advertisement function. And the properties that must be there in an advertisement so as to be high in effectiveness depends on the product category and therefore has to be different for different products depending upon the utilization of the product (Biel and Bridgwater 1990).

Customer responses to advertising

The effect of advertising were studied by Vakratsas and Ambler (1999) after analyzing numerous number of researches on the effect of advertising and finally came to the conclusion that there were basically three kinds of models that would describe this concept: The first model referred to as “market response” model, does not consider the short term effects or the immediate effects on the customers. The individual behaviour of purchase or brand choice have been explained as the major behavioural measures that have been related to advertising, price, and promotional tools.

Moreover, “aggregate-level” and “individual-level” are the two levels of studies. While the “aggregate level” uses the market-level data like brand advertising expenditures or market share, the “individual-level” uses single source data which is individual brand choice (Vakratsas and Ambler, 1999). The relationship between the impact of advertising sales and advertising spending studied by Lodish et al. (1995) is one of the examples of aggregate-level studies. Vakratsas and Ambler (1999) grouped the second category as hierarchy effect models. There are several other hierarchy odels that define the process of effects of advertisement. Hierarchy effect models presume that the influence of advertising on consumers involves certain levels and steps and is therefore a process with the presence of several intermediate advertising effects. “AIDA (Attention Interest Desire Action) studied by E. St. Elmo Lewis in 1989 is one of the examples of Hierarchy model (Vakratsas and Ambler, 1999; Ehrenberg, 2000). Although the validity of the hierarchy models have been questioned (Palda, 1966) but the effect of advertisements on the customers follows some steps and therefore the process needs to be studied.

The consumers may not change their brand preference immediately from one brand to another, then how and why consumers want to move from one stage to another or why do they just think of moving up to the next alternative level is a critical issue for understanding customers’ brand switching behaviour. And, it is also useful for increasing the effectiveness of marketing communication. Lavidge and Steiner (1961) stated that it is necessary to evaluate the changes at every stage of influence, than only to concentrate on the measures of sales volume and brand awareness so as to know whether an advertisement has been effective or not.

The classical psychological model (Lavidge and Steiner, 1961) can give us these three aspects of the customer responses. Beerli and Martin Sartana (1999) also stated that the three-component behaviour is the best way to measure the responsiveness of the consumers’ behaviour, namely; cognition, affection and conation or rational, emotional and striving states (Lavidge and Steiner, 1961). In addition, Ehrenberg (2000) stated that the effectiveness of advertising can be studied by measuriong the important three factors of product awareness, product trial, and repeat purchase.

An advertisement has a direct and immediate impact on the customers’ beliefs, attitudes and behaviour (Vakratsas and Ambler, 1999). They concentrated on these three personal characteristics giving more focus towards the behavioural aspect like the impact on brand choice.

Promotion and brand-switching

Promotion has been thought as one of the most successful tool to influence the buying behaviour of customers and increase the sales volume in the short-run (Laroche et al. , 2003). Neslin et al. 1985) stated that promotion can be used as an important tool for accelerating the sales. Gupta (1988) declared that what brands consumers will choose and the quantity in which they will make the purchase directly depends on the price and promotions. Laroche et al. (2003) came up with three major advantages of the promotions; initiating purchases which an individual had not planned, encouraging customers to buy the non-promoted merchandises and increasing the number of visits an individual will make to the store.

Promotional activities have a major impact on the brand switching behaviour of the consumers than increased sales due to increase in consumption (Oliveira Castro et al. 2005, p. 309). Their study also stated that when a customer buys a particular brand, his/her purpose is not only the functions of the product but mainly to satisfy the emotional needs. Therefore this purchasing behaviour of the customers need to studied not in a single direction. The authors stated two dimensions; utilitarian and symbolic factors, through which consumers on buying a particular brand look for benefits from these two perspectives: utility and informational benefits. Increased purchasing and new purchase from existing customers & new customers respectively have resulted from promotion which in turn results in increased sales. Usually, promotion is more focused to get new customers instead of exciting old consumers to buy more same products. However, Ehrenberg and Hammond (1994), argue that impacts of price promotion are more on old consumers rather than new customers.

Contrary to this, studies by Gupta, 1988; Bell, Chiang and Padmanabhan, 1999 show that the promotion is not so high on the existing customers but it mostly affects the consumers who switch from other brands. More than 80% of sales increase is by promotion which only includes a negligible percentage of increase that come from switching within a brand (Gupta 1988). Promotion is one of the aspects in the marketing mix which have been studied in terms of its relationship with customers’ responsiveness, especially at the stage of behaviour: the actual purchase behaviour (Shi, Cheung, and Prendergast, 2005).

It has been established by many researchers that there exists a strong correlation between promotional activities and brand switching and promotional activities and has been seen that many companies use promotional tools to acquire a strong customer base and make the customers using other brands switch towards their brands. However a marketer cannot build a sustainable competitive advantage by the use of promotional tools only. Many other researchers do not rate the romotional tools the prime factor that contribute towards brand switching because they believe the customer becomes loyal to any brand that designs its products so as to best satisfy its customers. They conducted various researches before promotional activities were undertaken and after the promotional activities and found that there was no great deal of brand switching on part of customers. According to Shi et al 2005, price discounts, buy-one-get-one-free, and in-store demonstrations significantly influence brand choice among the various promotion tools studied in Hong Kong.

The explanation to these the effects on these promotion tools on brand switching has been provided by other researchers also. According to Ram & Sheth 1989, a great affect has been observed on customers trying new products due to the demonstrations in stores and showrooms. Lichtenstein et al 1997 found that other promotional tools like “cents-off and free gifts” also have a considerable effect on the buying behaviour of customers.

The influence of price consciousness

According to Linear Learning Model by Lilien 1974, price has been measured as a determinant factor in brand switching.

A consumer cannot buy everything that he wishes to buy e. g. every customer who wishes to buy a Mercedes car cannot have it because of the income factor. The study of consumer behaviour had revealed that the most of consumers are price conscious. They will go for products that give them the desired benefits at an affordable price. In contrast to a product of a particular Brand which is high priced a consumer will go for a product of some other brand that offers him the same benefits but is relatively priced at a level that the consumer can afford.

The consumers do not respond in a similar way to price promotion . Many consumers may not respond to price promotion at all and may stick to their preferred brand only. However most of the customers will acknowledge the price promotion and respond to it in a positive way. According to Krishna 1992, customer expectations regarding pricing are different for different brands. The customers may purchase in bulk from preferred brands and may purchase fewer items from less preferred brands in response to price expectations.

According to the study by Mela et al 1997, advertisement and promotion impact the price sensitiveness differently. The customers become less price sensitive under the influence of advertisement and more price sensitive when the promotional incentives are offered.

Assumptions based on the literature review

Some assumptions were made on the basis of the studies previously done and will be tested with the help of survey questionnaire. Five such assumptions were made on the basis of previously reviewed research.

In the Indonesian market Advertising and promotion have a significant impact in the brand switching behavior among SUV users. For the testing of this assumption the customer’s attitude and behavioral change with respect to advertising and promotion will be tested. 2. Price consciousness has a significant role to play in customer’s response to advertisement and promotion in brand switching. Correlation analysis will act as a powerful tool in testing the relationship between price consciousness and brand switching behavior and same will be used for testing of this assumption.

The test will be carried out to find out whether there exists a positive or negative correlation between price consciousness and brand switching and to evaluate whether price sensitivity influences brand switching and also the relationship between consumer attitude and price consciousness

Conclusion Indonesia one of the unique countries with hundred cultures exist. One of the most important aspects in Indonesia is transportation. Indonesians are more interested to have a car compare using a public transportation.

As a result, there are many types of brands that people can choose, even sometimes they have to jump from one brand to another brand with some reasons.

Methodology

The main purpose for which a research project is carried out is to prove a stated hypothesis true or wrong, the various objectives are stated firstly for the purpose of establishing further research objectives, the data collection methods need to be reviewed carefully so that a method most suitable for the research can be selected which will be most reliable for the researcher to gather information.

The respondents for the research questionnaire were two different classes of Indonesian consumers middle and rich class because of their different purchasing behavior and tastes and preferences. As the previous research on the relationship between customer characteristics and brand switching depicts that customer characteristics may to some extent influence brand switching, it is evident to examine the influence of advertising on brand switching for every group separately and to compare the difference between different groups in terms of advertising effectiveness and subsequent brand switching.

Data collection

There are different types of data collection, such as primary, secondary, quantitative and qualitative, which can be used to collect the data for all kinds of researches. Both qualitative and quantitative methods can be used to collect the primary data. Quantitative research produces or deals with defining the data in terms of numbers or figures. The main data types used in this research are discussed below

Primary Data Questionnaire

A questionnaire contains various questions relevant to the research with specified answers among which the respondents may choose an answer which they fel most appropriate for a particular question.

The questionnaire may contain multiple choice questions or may be designed using various scales. Postal survey: Can reach a large number of people geographically. Interviewee is able to fill in the survey of multiple-choice questions in their own time and return it by post. Telephone interview: Telephonic interviews are regarded as an cost and time efficient method of collecting data. Moreover with the help of telephonic interviews the data can be collected with speed and information can be processed quickly without any undue delay in time.

The data where it can be quantified can be counted in numbers and analysed with the help of various statistical methods. Qualitative methods give a general idea about the data. Qualitative methods are used where a researcher needs to evaluate the psychological aspects of customers like motivation, attitude, social class, life style etc. Where qualitative methods are adopted the results cannot be quantified in numeric terms. The various qualitative methods that are used during research programs are: In-depth Interviews: Under this method a trained interviewer discusses various topics with the respondents freely.

The questions usually preferred are open ended that allow the respondents to share their feelings and thinking. In this qualitative method the results cannot be numerically measured. Group Discussions: Group Discussions are somewhat similar to In-depth interviews yet involve a gathering of small number of people who discuss various topics under the instructions of a group leader. There is a great deal of interaction among the members under this method and is most commonly used.

Diary panel: members of the public (panel) were asked to keep a diary of purchases made over a particular period of time, which can extend to up to a year. This provides information that cannot be collected in a personal interview. Observation Method: Under observation method a trained observer is selected who monitors the behaviour of the various respondents under study that are selected from a particular environment.

Secondary data

There is a tremendous amount of already collected data available for researchers. This sources can be classified into internal and external sources.

Internal sources are sources within the organisation in its day-to-day operations. These include data on sales, advertising, promotion and reports and so on. External data is collected from sources that exist outside the organisation. These include various commercial, government and industry sources of data. A source of secondary data is that data which has already been collected for some other research purpose and has been used for some other project. Secondary data is collected for the designing of literature review and background on customer brand switching and the car market.

The information required was collected from the Internet, various search engines, Libraries , Journals, Market findings, industry and various library databases. The prime benefit of using secondary data is its accuracy at the time it was produced, the source from which it was taken , and it provides relevant information on how the industry has grown over the years. The secondary data provides numerical data, which can help to properly evaluate social, demographic and economic happenings, and is time and cost efficient.

In addition to this, usage of secondary data means the privacy of people is not effected to a great extent. The common fault of using secondary data is that the data is already used from some other research objectives and purposes, that are altogether different from the present hypothesis under investigation. In addition to this secondary data becomes out of date, as it has been collected before a long time for some other purpose. Moreover access to secondary data becomes very difficult in certain cases due to privacy concerns.

Selected methodology

The research methodology used for the project is qualitative research with the main objectives of analysing the reason for which the customers make a switch from among different brands in the car industry SUV sector in Indonesia. The quantitative methods will be adopted for data collection in numbers and the application of qualitative research will assist in having a proper insight of the consumer behaviour. Eventhough the primary data has its disadvantages it still has been used as the main method of data collection.

Firstly primary data can be very time consuming, questionnaires in particular, as many different people need to fill them in. Additionally, questionnaire can give misleading results as the respondents may be reluctant in giving the truthful results. Method used in the research is qualitative research, to fulfil the objectives of the study, which is to study the behaviour of consumers switching brands of four-wheeled vehicles. In collecting the data, some methods which were used are:

Interview

An exclusive interview was performed with some car manufacturing companys’ key management as a source to get information and descriptions.

A brief idea about tactics, history and background was known so as to get initial description about factors that can affect consumers’ behavior in car brand switching. Apart from them, some users of the SUV cars were also interviewed to understand and analyze their viewpoints and draw some research related facts.

Observation

Observation might become one of the data collection techniques which can be controlled if it is done appropriately according to the aim of the research. Field research that can be done is seeing insight of company’s target market. The observation was done on the company showrooms of the car outlets o study the settings and the behavior of the customers and sales people. The behavior of SUV-car consumers was also studied through observation so as to help in generalizing their tastes and preferences.

Questionnaire

Questionnaire could be a way of data collections to investigate an issue, which is generally related to the interests of a group of people. This method uses a list of questions and circulate proposed in writing to a number of respondents to get a reply or a response. The point to ask in the questionnaire is based on the research question.

So, questionnaire was made, to know deeper about the customer brand switching decisions. Whether client or consumers willl notice and be interested with the new identity of the company, and so on. Questionnaires were self-administered, in the presence of the researcher to ensure they are completed correctly and the researcher can resolve any problems that may arise, to collect primary data. This will provide the opportunity to find out the selected sample’s responses as quantitative data can pick out small differences, which would be ideal for testing the hypothesis of the project.

Self-Administered questionnaire was chosen as opposed to using postal or drop in questionnaires because it has low cost per survey and less interviewer bias. Moreover, the responses are gathered in a short period of time as compared to postal or drop in surveys (Malhotra et al. 2003). Results will also be up to date and relevant as research being carried out is directly related to the project. Another reason for using primary data is that there is little literature, research and evaluation relating directly to customer switching in the SUV-car sector of the car industry.

Questionnaire structure

The questionnaire consists a total of 27 questions. All questions were closed ended (also referred to as fixed alternative questions) and semi-structured which consisted of multiple choice questions, where respondents selected and marked their answers from a pre-specified list which was closest to their opinion or wrote in their answers if it was not an option in the list. It not only makes answers easier to interpret and tabulate but to code as well.

In order to make the thesis purposive, Questions were designed to be logical, clear, unambiguous and easy to understand, and as the questionnaire was being self-administered, any confusion towards it could be resolved instantaneously. The lengths of the questions were short and concise and non-biased by providing all possible answers. To get the desired results, the questionnaire was split into sections or parts, which was designed to get the logical responses. The questionnaire began by getting the basic information like whether the respondent owns a SUV, how many, if not then, whether they would consider getting one.

This was asked so that it could be determined whether the respondents qualified as someone who belonged in the sample to be researched. The respondents who were considering getting a SUV car were given more attention and their behaviour was studied through observation additionally. There were four parts included in the survey questionnaire: brand switching, price consciousness, customers’ responses to advertising, and customers’ responses to promotional tools. At first, customers’ brand switching behavior was evaluated. The related questions include “the reasons for changing car brand, the number of brands changed before”.

The part two of the questionnaire investigated the price sensitivity of customer. Three questions were asked to test to what extent customers will be influenced by price change. The third part of the questionnaire focussed on customers’ response to advertising by a car manufacturer. Customers’ brand switching behavior related to advertising contents were tested by probing different questions. The last part of the questionnaire was to test the relationship between brand-switching and promotional tools. Mainly, four promotional tools were tested in terms of their effects on brand choice behavior.

These promotional tools include “price discount, in-store demonstration, coupons and free gifts”. The responsiveness of these promotional tools will be evaluated in the results and findings part later. The main body of the questionnaire consisted of questions that covered the information needed to test the hypothesis. The focus here was around the reasons why consumers switched away from a particular brand to another. The reasons for switching were broken down into the options related to our research i. e. , the impact of promotion and advertising on them and the effect of price consciousness.

The questionnaire ended by asking information about the individual. This comprised of demographics about the respondent, which could provide a method for identifying differences of key results in response by subgroups in terms of age, gender, location and working status. Demographics are primary factors, which can influence factors such as attitude and behaviour, such as switching and consumer loyalty. This could be used later when analysing the results to comparing to switching behaviour. This survey questionnaire was designed based on the several research works, and comes from the assumptions made previously.

Research on price and advertising/promotion responsiveness, is the basis of the questionnaire. The four promotional tools are based mainly on Shi et al. (2005)’s research, the evaluation of price consciousness was designed according to Huff and Alden (1998)’s research

Data analysis

Once questionnaires were completed and the data had been collected, they were entered onto a spreadsheet using SPSS. This enabled responses for individual questions to be coded, calculated, analyzed and interpreted, which were later used to form cross tabulations and pivot tables.

The pivot tables were then used to explore and compare responses from different questions to one another, as well as to test the hypothesis. The main statistical techniques used in analyzing the data are Regression analysis and correlation analysis that will be discussed. Quantitative research methods such as general linear model (Univariate), regression and correlation will be the main data analysis methods. General linear model can be used to analyze the impacts of each variable and the effects of their interaction on dependent variable (Foster, 2001).

So it will be used to analyze the impacts of different age groups, product categories, and the interaction between them on the responsiveness of advertising and promotion (the attitudes towards advertising contents and the importance of promotional tools). Given that correlation analysis can present to what extent two variables can change together (Foster, 2001), it will be adopted to test the relationship between price consciousness and brand switching, and the relationship between customers’ price consciousness and their responses to advertising contents and promotional tools. Meanwhile, because several independent variables ( e. . reasons for brand-switching) can be applied to predict the dependent variable (e. g. brand-switching) through regression analysis (Foster, 2001), regression will be used to analyze the reasons of brand-switching, such as the main reason for brand-switching, the effects and the importance of advertising/promotion in terms of brand-switching compared to other reasons.

Conclusion

There are various research collection methods need to be review so that a suitable method can be revealed. In this chapter, I do characterize the consumer based on 2(two) types, rich people and poor people.

The first step that I do to process this research collection of the data of the market and business situation. Secondly is choosing of the method. In this part I do believe that qualitative research method is suitable for this project. Thirdly is creating structured questioners for the market itself and producing some feedback. Lastly, analyzing the data itself is important to get the whole picture of our research.

Findings and analysis

The relationship between advertising/promotion and brand-switching

This study studied the relationship between advertising/promotion and brand-switching.

The two major reasons for brand switching assumed by this study are advertising and promotion. To find out the significance level of the above said reasons on brand switching behaviour of customers, regression analysis has been carried out to examine the affiliation between these two possible reasons and brand-switching. Testing has been done by taking ‘the frequency of brand-switching (the number of switched brand in the past ten years)’ as dependent variable and ‘the two reasons for brand-switching’ as independent variables.

The results of regression analysis clearly confirm that the two factors viz: promotion and advertising greatly affect brand-switching behavior of customers. But it is worth to mention here that though these two reasons tested in the linear model only cannot interpret brand-switching at a larger scale and there could be many other important reasons missing, however, the effects of promotion and advertising have been proved. In addition it is also clear from the results that promotion has larger impact on brand-switching than advertising.

It has been assumed that price consciousness has a relation with brand-switching, however, the results of correlation analysis show that there is no strong relationship between brand-switching and customers’ price sensitivity (Pearson correlation: -. 020, sig. : 0. 801). On the other hand, it has been found that price consciousness may to some extent determine the effectiveness of some promotional tools in terms of leading to brand switching, when correlation analysis was applied to test the relationships between customers’ price consciousness and the influences of promotional tools on brand switching.

Thus it may be inferred that customers, who are high price conscious, tend to prefer coupons, price discount, and free gifts type of promotions and are more likely to switch to other brands when they are lured by these types of promotional tools/promotions.

It was found that there exists a negative correlation between price consciousness and preference for strongly favoured brand image content in an advertisement, and there exists a positive correlation between price consciousness and the impact of strong money value in advertising. The other advertisement aspects, like interest, viral communication, and reliable quality, have a negative relation to price consciousness.

Thus it can be established that, customers with small price consciousness may easily make a switch to other brands under the pressure of the interest in content of the advertisement, the viral communication used and the valuable information about sophisticated quality in the advertising.

Analysis of assumptions

There were two assumptions which were made in the report and whether they hold true or will prove wrong will be tested with the help of statistical tools. In the Indonesian market Advertising and promotion have a significant impact in the brand switching behavior among SUV users. To study the relationship between the advertising, promotion and brand switching regression analysis was used. During the analysis it was found that advertising and promotion had the most significant bearing on the brand switching and was found to be the most alarming reason for brand switching.

The analysis also made it clear that there is a strong relationship between brand switching and advertising and promotion. Also the assumption was proved with the same analysis. Price consciousness has a significant role to play in customer’s response to advertisement and promotion in brand switching. It was found during the analysis that there exists a strong correlation between the advertising and promotion and the price consciousness and it was found that price consciousness has an important bearing on advertisement and promotion and the assumption stated was found out to be true.

The correlation analyses have been run in this study: the relationship with the usage of promotional tools, reasons for switching brand and attitudes towards advertising contents. The results show that the level of customers’ price consciousness will to some extent determine which aspects are the main reasons for changing brand, which promotional tools and which aspects of advertising contents will have strong influences on their brand choice decision. In addition, the result of the correlation analysis shows that customers who have high price consciousness are more likely to be attracted in turn by free gift (Insurance), coupons (e. . free 1 year maintenance/service/warranty), and price discount, and they are more easily to change to other brands which have good value for money and which may not have good brand image. Similarly, high price consciousness customers may be less interested in good brand image, interestingness, celebrity, and good quality in advertising.

Conclusion

In this chapter, I have discussed about some reasons why people do brand-switching. There are two main aspects that effect brand-switch exists which are advertising and promoting.

Those two aspect playing the important role on brand-switching. However, those two aspects cannot be implemented if there is no supporting aspect, such as, pricing matters of the product.

Discussion

Advertising and brand-switching

The influence of advertising and promotion on brand switching behavior among Indonesian SUV car users has been found varying at different stages of purchase and stages of awareness and advertising as depicted by the comparison of the impacts of advertising and promotion on each stage of customer’s responses to advertising and promotion.

It becomes clear that the helpfulness of advertising and promotion may increase customers’ brand awareness and encourage existing customers to go for the same brand, rather than influencing customers to buy another brand which they have not used yet. This result has also been shown by some arguments of other researchers. As per Simon and Arndt (1980) and Tellis (1988) the main objective of advertising is not to attract new customers but to strengthen the satisfaction of existing customers.

They argue that advertising can strongly influence the customers who already know the brand advertised rather than the new customers who have not used the brand before. It can be seen from the results that the influence of advertising on purchase stage is not the main impact of advertising, rather increasing customers’ brand awareness and repeat purchase may be the main objectives of advertising. Other previous research (Neslin 1994) studied the relationship between brand switching and advertising, and establishes the fact that advertising has a positive effect on brand switching.

The results of their research found that advertising has a positive influence on sales and advertising could increase brand-switching. This study also found advertising as one the main reasons for brand switching. Looking to the above two aspects of the findings of this research, it can be said that the influence of advertising on brand-switching do not challenge each other; rather they illustrate the two different aspects of the influence of advertising on brand switching.

On the one hand, advertising has positive impact on brand-switching; on the other hand, its influence on brand-switching may not be as strong as on other stages of customers’ responses to advertising, such as increasing brand awareness and repeat purchase. This study also studied the relationship between brand switching and advertising contents, and it was found that advertising contents have been preferred by customers.

February 4th, 2023

Short-term promotion strategies

In 2005, Brazilian and foreign companies invested 6 million dollars in outdoor advertising. The four major forms of outdoor advertising in Brazil include transport, street furniture, billboards, and alternative media. Despite the well-known campaign for “clean city” recently launched in San Paulo, other large Brazilian cities remain open to outdoor advertising. These large cities represent extremely promising target markets for Mario Badescu brand.

The cost of advertising in the major Brazilian cities will depend on the exact billboard location and the size of each particular billboard. In our outdoor advertising, we will use simplistic approaches, which are traditional for outdoor advertising in Brazil (1, p. 104). Mario Badescu outdoor advertising billboards must attract consumers’ attention, and involve them into a kind of dialogue. The benefits of outdoor advertising are evident: the customers see advertising, the product, and the slogan each time they leave home, look into the window, or simply walk across the street.

The need to use outdoor advertising in our promotion campaign is justified by the fact, that the United States mostly supplies Brazil with mass-market cosmetics. This cosmetic is more expensive than the one produced locally (7). This is why we need to use all possible advertising tools to prove, that our products are more competitive and deserve attention even despite their relatively high prices for consumers.

In outdoor advertising, we will combine the visual “green” appearance of Badescu brand with the slogan “I feel you… I touch you… I love you…” similar to the one we use in our TV advertising campaign. This will produce an engaging effect on the potential consumers (especially women). The billboards are to be located in the middle and higher class neighborhoods, to attract the attention of the potential consumers. We will also consider the most promising high class locations for our stores, to make it convenient for our high and middle class consumers.

February 4th, 2023

Global Brands

When a single brand is marketed by the manufacturer, the brand is assured of receiving full attention for maximum impact. However, a company may choose to market several brands within a single market based on the assumption that the market is heterogeneous and thus it must be segmented. Consequently, a specific brand is designed for a specific market segment. The watch industry provides a good illustration for the practice of using multiple brands in a single market, for different market segments. Citizen, in its attempt to capture the new youth and multiple-watch owners’ market, traded down to include a new brand called Vega. Likewise, Hattori Seiko is well known for its Seiko brand , which is sold at the upper-medium price range in better stores; to appeal to a more affluent segment, the company traded up with the Lassale name.

Seiko strategy is to deliberately divorce names, once used together in the public mind, with the gold plated Lassale line and the karat-gold Jean Lassale line. Lassale watches have Seiko mechanisms, but they are produced in the USA and the Western Europe and they are sold only through jewelers and department stores. Swatch Group Ltd. has more than 50% of the Swiss watch industry. Swatch owns a number of well-known brands that include Omega, Longines, Tissot and Calvin Klein.

Multiple brands are suitable when a company wants to trade either up or down because both moves have a tendency to hurt the company’s main business. If a company has a reputation for quality, trading down without creating a new brand will hurt the prestige of the existing brand. By the same assumption, if a company is known for its low-priced, mass-produced products, trading up without creating a new brand is hampered by the image of the existing products. Casio is perceived as a manufacturer of low-priced watches and calculators and its name affects its attempt to trade up to personal computers and electronic musical instruments.

There are four recognized branding strategies. The following three kinds of branding strategies are created in order to be suitable for multiple brands. Corporate umbrella branding is used by firms such as Heinz, Kellogg’s and Cadbury’s. The corporate name is used as the lead name for all their products, for example Kellogg’s Healthwise, Kellogg’s Frosties, Kellogg’s Corn Flakes. Family umbrella names are used to cover a range of products in a variety of markets.

For example Marks and Spencer use their St. Michael brand for clothing, food and household goods. Range branding is used for a range of products with a particular link in a specific market such as Lean Cuisine for low-calorie foods. The second category represents another type of branding strategy and it is the individual brand name strategy. Individual brand names are used with individual products in a particular market, with different weights, colors, flavors and pack sizes. Procter ; Gamble and Unilever use individual brand names such as Daz, Ariel and Omo, using no reference to the corporate name.

Local Brands vs. Global Brands When the manufacturer decides to put its own name on the product, the problem does not end there if the manufacturer is an international marketer. The possibility of having to modify the trademark cannot be dismissed. The international marketer must then consider whether to use only one brand name worldwide, or different brands for different markets or countries.

A single worldwide brand is also known as an universal or global brand. A Euro-brand is a slight modification of this approach, since it is a single product, for a single market, with an emphasis on the search for intermarket similarities rather than differences. For a brand to be global or worldwide it must, by definition, have a commonly understood set of characteristics and benefits in all of the markets where it is promoted. Coca Cola is a global brand in the sense that it has been successful in maintaining similar perceptions across countries and cultures. However, most other brands do not enjoy this kind of consistency, making debatable whether a global brand is a practical solution.

A worldwide brand has several advantages. First, it tends to be associated with status and prestige. Second, it achieves maximum market impact overall, while reducing advertising costs because only one brand is promoted. Bata Ltd., a Canadian marketer and shoe retailer in ninety-three countries, Romania including, found out in its research that its consumers generally believed Bata to be a local brand. The company decided after that study, to become the official sponsor of World Cup soccer in order to enhance Bata’s international stature. For Bata and others it is easier to achieve worldwide exposure for one brand than it is for multiple local brands.

Third, a worldwide brand provides a convenient identification and international travelers can easily recognize the product. There would be no sense in creating multiple brands for such international products as American Express credit card, Shell gasoline, Time magazine and so on. Finally, a worldwide brand is a good approach when a product has a good reputation or is known for quality. In such cases, a company would be wise to extend the brand name to other products in the product line

Global Consumer Culture Positioning (GCCP) is a tool that suggests one pathway through which a brand may be perceived by consumers as “global”. GCCP is an instrument that associates a brand with a widely understood and recognized set of symbols which constitute an emerging global consumer culture. ACNielsen’ s Global Mega Brand Franchises report uses a number of criteria to identify mega brands.

A mega brand must be available in at least fifteen out of fifty countries that account for 95% of the global economic output. It must be marketed under the same name in at least three different product categories in three or more regions. Based on these criteria, the mega brands are dominated by the highly extendable personal care and cosmetics manufacturers and by food and drinks manufacturers. The queen of mega brands is Nivea, a brand owned by the German consumer products group Beiersdorf. This skin-care brand is a huge success and the brand has been extended to at least nineteen product categories-shampoos, after-shave, wrinkle lotion and bath foam. In contrast, Coca Cola does not have this power of extendability.

The use of multiple brands is a very common practice. In the case of Unilever, its fabric softener is sold in ten European countries under seven names. Due to decentralization, the multinational firm allows country managers to choose names, packages and formulas that will appeal to local tastes. More recently, the company, while keeping local brand names, has been gradually standardizing packaging and product formulas.

There are several reasons for using local brands. First, developing countries resent international brands because the brand’s goodwill is created by an advertising budget that is much greater that research and development costs , resulting in no benefit derived from research and development for local economies. In addition, local consumers are forced to pay higher prices for advertising, not helping the development of local competitive capacity. Such resentment may explain why India’s ministries, responding to domestic soft drink producers’ pressures, rejected Pepsi’s 35% Pepsi-owned joint venture. Second, when the manufacturer is unable to ensure uniform product quality across countries, it should consider local brands. Third, when an existing brand is difficult to pronounce, a new brand may be desirable. Sometimes, consumers avoid buying a certain brand when it is difficult to pronounce, because they want to avoid the embarrassment of a wrong pronunciation.

Then, a local brand is more easily understood and more meaningful for local consumers. By considering foreign tastes and preferences, a company achieves a better marketing impact. Grey, an international advertising agency, worked with Playtex to create different appropriate names for Playtex’s brassieres in different languages. The result was Wow in England and Traumbugel ( dream of wire) in Germany. Translation may also make a brand more meaningful. This approach is sometimes mistaken for a single-brand approach when in fact a new brand is created. Close up ( toothpaste) was translated as Klai-Chid ( literally meaning ” very close”) in Thailand; the translation retained the meaning and the logo of the brand as well as the package design. Fifth, a local brand can avoid a negative connotation. Pepsi introduced a non-cola under the Patio name in America but under the Mirinda elsewhere due to the unpleasant connotation of patio in Spanish.

OUR GIFT TO YOU

15% OFF your first order

Use a coupon FIRST15 and enjoy expert help with any task at the most affordable price.

Claim my 15% OFF Order in Chat

Brand

NATCO Brand

Niké, Inc.: Product Line and Brand Positioning

Abstract

Niké, Inc.: Product Line and Brand Positioning

Main Body

Product & Price

Distribution

Brand positioning

Promotion strategy

Conclusion & Recommendation

References

Literature Review on Brand Awareness

Veet Promotion Campaign

Brand-switching behaviour

Executive summary

Introduction

Statement of problem

Objectives of the Study

Research Questions

Significance of the study

Literature review

Brand switching

Advertising and brand-switching

Advertising effectiveness

Customer responses to advertising

Promotion and brand-switching

The influence of price consciousness

Assumptions based on the literature review

Methodology

Data collection

Primary Data Questionnaire

Secondary data

Selected methodology

Interview

Observation

Questionnaire

Questionnaire structure

Data analysis

Conclusion

Findings and analysis

The relationship between advertising/promotion and brand-switching

Analysis of assumptions

Conclusion

Discussion

Advertising and brand-switching

Short-term promotion strategies

Global Brands

Sometimes it is hard to do all the work on your own