2. Type Private limited company
Industry Pharmaceuticals
Healthcare
Beauty
Photography
Founded 1849; 167 years ago,Nottingham, United
Kingdom
Founder John Boot
Headquarters Nottingham, United Kingdom
Area served United Kingdom, Republic of Ireland
Key people Simon Roberts, managing director, Boots
UK and Ireland
Brands No. 7 and Seventeen – Makeup
Soltan – Sun cream
Almus – Generic drugs
Number of employees 70,000 (UK)
1,900 (Ireland)
24. BRANDS
• Pantene, Clairol, Head and Shoulder, PER
plus, Daily Defense.
STRENGTHS
• Best selling hair care brand around the
world as per 1995 census.
• Share 8.4% percent of UK’s hair market
WEAKNESS
• Significant presence in mass market
products/basic products but have less or
no professional hair care products.
25. BRANDS
• St. Ives, VO5, Consort Hair Care for Men,
and FDS.
STRENGTHS
• Offer Broad Assortment of Hair Care
Products.
WEAKNESS
• Have less or no professional hair care
products.
• Lesser number of stores
26. BRANDS
• Lancôme, Giorgio Armani, Biotherm,
Ralph Lauren.
STRENGTHS
• Global Presence.
• Share 5% percent of UK’s hair market
WEAKNESS
• Significant presence in mass market
products/basic products but have less or
no professional hair care products.
27. CONCLUSION FROM
ABOVE MARKET STUDY
1. Increase awareness
about its professional
hair care products
2. Differentiate its
products with others
through packaging or
sales strategy.
31. • Buy 2 products of a brand and get 3rd
product for free of the same brand.
Purchasing cost will include summation of
max of two among three selected.
Scheme
• 300% of pre promotion sale.
Estimated
Sale
• Less competitor has the technology
to imitate the model because of
dearth of required technology.
Competitive
Advantage
32. • A product sample is given along with a regular
purchase. Since sample size of product is
packed with the regular sample so no extra cost
of manufacturing addition samples.
Scheme
• 170% of pre promotion sales.
Estimated
Sale
• Competitor can easily imitate this
model so no advantage as such.
Competitive
Advantage
33. • Get a 50p off coupon and
redeem it during your first
store visit.
Scheme
• 150% of pre promotion sales.
Estimated
Sale
• No advantage, competitor
can easily imitate this model.
Competitive
Advantage
35. Select a model to increase sale for lower
brand hair care products that would be most
profitable to the company at the same time
maintaining and enhancing the professional
hair care brands.
36. 1. Which promotion strategy to incorporate keeping
in mind the cost to the company and its brand
equity.
2. Since consumers are not brand loyal, so how to
effectively differentiate the promotion strategy from
other major brands so as to get at least the estimated
38. Since Boots primary objective is to trade up consumers from
lower value brands and to drive sales volume, while
retaining or building brand equity.
So, I believe the best promotion strategy
would be “Get 3 for price of 2”.
40. REASON 1:-
Since it involves maximum increase in the
total sale viz. 300%, which is our primary
aim.
41. REASON 2:-
Since the technology to implement this
strategy is with few or no other company,
hence it would be unique as customer will
be able to differentiate it from other
competitors.
42. REASON 3:-
Second aim was to maintain or enhance the brand equity,
this will enhance using the above strategy since we are
using sales promotion for all value brands and with this the
customer inflow is increasing and hence automatically the
incoming new customers(apart from regular boots
customers) will try its premium products and since the
products are better than any other product in market due to
its professionalized manufacturing process thus will lead to
a satisfy or even a happy customer and people have value
for their money and hence will increase brand equity and its
professional hair care products will penetrate into the lower
income market too.
43. REASON 4:-
Cost : With this strategy there will be no
increase in cost, nothing from packaging
to manufacturing new samples as gifts.
44. A good strategist tell both upsides and
downsides of its proposed strategy. So
let’s see the downsides.
45. DOWNSIDE OF ABOVE STRATEGY:-
Since the strategy involves offering one bottle for
free on purchase of 2, so it could cost company a
little more but, and this is a big BUT, its benefits are
multiple : from increasing sales to brand awareness
to brand equity and above all since there is no extra
cost and company has well planned manufacturing
unit so it can further decrease its cost thus will be
profitable overall for both present and future time.
46. Now after proving that “3 for 2” strategy
is best,
to finish of the case analysis before
getting through the final step.
48. => Although 170% increase in sale, but 93% of product price
would be spent in offering sample product as gift along with
the purchase.
=> Since above strategy incur more costs with lesser sales and
above that offering competitors equal opportunity to adopt
the model thus diluting the differentiating itself strategy. So,
this strategy is less likely to be adopted.
49. => This strategy is comparatively good since it ensures customer to buy
more than one product hence increase sale.
=> But, since it offers a 50p off on the same product, so in that way no
customer would be inclined to buy two bottles of the same product at a
price of 1.5 of original cost of 1 bottle or 3 bottles at a cost of 2 bottles,
which is equivalent to the first strategy but more sales and offering
variation in products thus more alluring to the customers.
=> Above all this model is mostly used by other competitors too, thus
is less likely to be adopted.