Prof. KlingerBusiness Administration
Tuesday and Thursday 11:30-12:50
This homework is very well researched, structured, and written. Notice the data on the target market, market share, distribution channels, and the clearly defined market segments. Also notice how the marketing mix is defined for each segment and for each element of the marketing mix, the paper says how that element addresses that particular segment. The paper does a good job of referencing and citing sources.
Homework #5
May 1st, 2014
Names
1
Prof. KlingerBusiness Administration
1. Identify the target market
The hair care market had no significantly changes between 2006 and 2011. Sales were $6.5 billion in 2011 just $10 million more than in 2006 (Mintel International Group Ltd.). Below is a table of the sales and US share of the market.
Year / Growth of Shampoo & Conditioner Market / USA percentage of Market / USA share of Global Market (B=billion)1997 / $41.137 B / 37.70% / $5.33 B
1998 / $14.759 B / 38.42% / $5.67 B
1999 / $15.461 B / 38.92% / $6.02 B
2000 / $16.256 B / 39.17% / $6.3 B
2001 / $16.795 B / 39.42% / $6.62 B
2002 / $17.509 B / 39.68% / $6.95 B
(Mintel International Group Ltd.)
Suave is a product made by Unilever. From 2007-2012, Unilever increased its share of the U.S. hair care market from 9% to 16% (Report Linker). Shampoo is the leading segment in the global hair care products industry. Hair care products in the United States are dominated by three major companies including; L’Oréal, Procter & Gamble and Unilever.
Suave’s motto is “looking great doesn’t have to cost a fortune.” Their customers are savvy shoppers. Their target market is people who are value minded. Suave’s products are considered high quality but with a low price. Their targeted demographic is women who are heavy shampoo users between the age of 18-45 in the middle income bracket (Suave). Suave targets all age groups; from babies to senior citizens. They also sell their products in three continents including North America, Asia and Europe. Suave’s products are suitable for babies, children and adults. Their target market consists of males and females who have a family. They typically have a low to moderate income and are homeowners (Unilever). The characteristics of Suave customers include mothers, large families with young children, price sensitive, blue collar and love in rural and suburban areas. Suave also targets all races. Suave’s products are ranked #1 with Hispanics and #3 for African Americans. Suave’s customers are also have busy lifestyles and want to look good without spending a lot of money. Due to their customer’s moderate income and busy lives, most of their products are sold in convenience stores like dollar stores, Wal-Mart and grocery stores. Suave’s products are used in 16 million homes; which is more than 90% of shampoos. In addition, Suave has the longest line of shampoos. Their strategy is to have many choices so people stay within the same brand.
Below is a graph of shampoo sales in different channels in 2011/2012. The most productive sales channel was food outlets. Suave mainly targets customers who buy at drug and other outlets rather than food. An opportunity for them to expand can be seen in the food outlets.
(The Statistics Portal)
2. Identify the market research you would do to understand the target market.
There are many market research techniques that can be used in order to better understand a company’s target market. Surveys are the most common idea, but are boring and not creative. They are however straightforward and concise. Another option to learn about the target market is through focus groups. Focus groups can be used in order to better understand the customer’s feelings about a certain product. The company can learn how people think about the product, what they would like to see in order to develop new products to fit consumer needs. From this information companies can learn how to improve their product or create another one.
Another idea is giving Suave users a discount card and they have to swipe it every time they buy a Suave product and they can build points in order to earn savings. This will allow the company to know where their customers are buying their products. This is a way to track the customers and learn more about them. Grocery stores and other large companies keep track of their customers through loyalty cards. By data mining and working with these stores, Suave could learn more about their customers. This technique will allow Suave to know where they should place more of their products.
Social media is a huge new industry. Social network sites are a good place to learn about your customers. Offering rewards for liking Suave on Facebook or following them on Twitter would allow Suave to learn more about the customer’s habits. Knowing where customers spend their time is crucial. 16% to 25% of Internet users spend their online time on social network sites. Additionally, customers spend 1 out of every 6 online minutes on social networks (Social Media Examiner). Social networks and blogs are a major component of this time. Suave could create a blog site where customers can interact and share ideas. Using this information, Suave could better meet the needs of their customers. Facebook is also a good way to find out about the target market. If a Facebook page has over thirty likes, the company has access to Facebook Insight. Insights allows the company to see who is interacting on the page, demographics and media consumption. Facebook is a great way to monitor customers. Google Analytics also offers information to companies about who is visiting their websites and what they also search when googling their brand.
Based on the information collected from these market research techniques, companies can develop new marketing and business plans to target their customers. The research is intended to discover what consumers like about a product, what they dislike and what they would like to see. If researchers find that there is a segment of the market that is interested in Suave products, but there are no shampoo products that meet their needs, they can develop a new product.
3. Identify the different segments in the market. Be specific about the characteristics of the segments
- Segment #1 Marketing Mix:Males with ages ranging from 18-40, with incomes between $30k and $90k, who are care about their hair and clean their hair frequently.
- Product:Suave’s 2-in-1 Anti-Dandruff Classic Clean Shampoo & Conditioner helps control scalp itching and flaking associated with dandruff. It is designed for men’s hair and is salon proven to clean as well as American Crew® Anti-Dandruff Shampoo. This product addresses the segment because dandruff most commonly affects males during this age range. Other Suave products that are specific towards males include 2-in-1 Classic Clean, 2-in-1 Alpine Fresh, Daily Clean and Deep Clean Peppermint. Males prefer 2-in-1 products because they are more convenient and you get more for the price of one.
- Pricing Strategy:The prices of these types of shampoo are between $3-6, so all classes of people are able to buy. Suave used this price because this product is stable in the market. Young males and older males all have the ability to buy this product.
- Promotional Strategy:Suave can do some television commercials on channels that appeal to males from 18-40. These include, ESPN, Spike and USA. These channels would appeal to the market because the audience of these channels is mostly male dominated. Magazines where ads can be placed include Men’s Health, GQ and ESPN. Advertising during a high viewing time on ESPN for a sports game would be a great opportunity to reach a wide range of people.
- Distribution Strategy:The places to distribute these shampoos would be in stores and online like amazon.com, SOAP, Target, Wal-Mart, Walgreens and CVS. Once we do more research, we could target certain locations with more male dominated population and place more bottles in those locations.
- Segment #2 Marketing Mix:Parents with incomes between $40k and $110k with kids between the ages of 3-14 and who want their kids’ hair in nice condition and can leave skin soft.
- Product:Tear-free Suave Kids® Watermelon 3-in-1 formula combines shampoo, conditioner and body wash to help clean and detangle children’s hair and leaves their skin soft and smooth. There are many other scented 3-in-1 and 2-in-1 kids hair products.
- Pricing Strategy:The price for these shampoos is about $4, which every class of people is able to buy. The price is low but still has good quality. It has a specific cover which most kids like that may affect on the price. The designs and characters on the bottle appeal to the kids, but the superb formulas are marketed to the parents. The 3-in-1 formula makes the product more stable in the market. The 3-in-1 formulas are also good to teach children how to take a shower.
- Promotional Strategy:This product is created for kids, so it can marketed on Cartoon Network, Disney Channel and Nickelodeon. These channels will attract the attention of the kids. However, to get the parent’s attention, since they are the ones who will buy the product, advertisements can be placed in magazines like Good Housekeeping, Parenting, Reader’s Digest and Women’s Health.
- Distribution Strategy:This product is sold in many stores in the US and online like amazon.com, SOAP, Target, Wal-Mart, Walgreens and CVS. The children’s shampoos should be placed in stores near schools and day cares. Families with children are a major part of Suave’s target market.
- Segment #3 Marketing Mix: Women and men ranging from 16 and up with an income ranging from $25,000-$90,000 who color their hair and want to protect and extend the color.
- Product: Hair Color Protection shampoo and conditioner is for people who color their hair and want to lock in the color and prevent it from fading. This formula helps moisturize hair and keeps it healthy and from drying out.
- Pricing Strategy: The pricing for this product is $4.00 which offers a great value without sacrificing quality.This product and price are optimal for individuals who want to color their hair.
- Promotional Strategy: This product is created for women who color their hair at any age. This product can be marketed through magazines at hair salons and commercials for television shows like MTV where the age is generally 16-35 and actively engage in coloring their hair and all the newest fashions. Comedy Central, ABC Family, TBS, ABC and CBS are all channels where women watch television. Specific shows to place commercial advertisements include, The Bachelor, Scandal, Grey’s Anatomy, Dancing with the Stars and Revenge. These shows are perfect opportunities to reach this market segment.
- Distribution Strategy: This product is sold at Wal-Mart, Drug stores, Harmon, Shop Rite, Beauty Salons, and hair color supply stores. To reach people who dye their hair, these products should be sold in salons. Deals with salons can be made in order for Suave products to be sold at salon locations. The income range and demographic of people correlates with Suave’s target market.
- Segment #4 Marketing Mix: Any person who has dry hair and uses this product to help keep their hair moisturized and soft. The market includes men and women with income ranging from $15,000-$80,000 who want a great product at a great value.
- Product: Suave Professionals Sleek shampoo for dry or frizzy hair is perfect for people who experience dry hair or humidity related frizziness. Suave also has shampoos with Keratin and Moroccan oils to aid with frizzy hair.
- Pricing Strategy: These productsare in the $3.00 range. It is a cheap and easy way to keep your hair healthy and moisturized.The price is perfect for people with frizzy hair because they may need to buy this product often in order to manage their hair.
- Promotional Strategy: This product is created for people who have problems with their hair being dry or falling out, as well as when humidity picks up it prevents frizziness. This product is made for people with dry hair so it is marketed on commercials with soap operas, hair coloring products, as well as in stores when they are on sale. Channels for commercials include ABC, TLC, CBS, FOX and Lifetime. This product can be marketed in similar location as the hair dye shampoos because they aim to market the same women.
- Distribution Strategy: You can find this product online atAmazon or Target, Wal-Mart, grocery stores and Walgreens. This product would be optimal for salon locations. Salons are where women go when they are having issues with their hair.
Works Cited
Mershon, Phil. “5 Social Media Tips for Finding and Engaging Your Target Audience.” Social Media Examiner. N.p., 28 Mar. 2012. Web. 23 Apr. 2014. <
Mintel International Group Ltd. “Shampoo, Conditioners and Styling Products - US - April 2012.” Market Research. N.p., 18 Apr. 2012. Web. 23 Apr. 2014. <
“Suave Company Information.” Suave. N.p., n.d. Web. 23 Apr. 2014. <”Suave®.” Suave Product Information. Unilever USA, n.d. Web. 23 Apr. 2014. .>.
“Suave®.” Suave Product Information. Unilever USA, n.d. Web. 23 Apr. 2014. <
“U.S. Shampoo Sales via Different Sales Channels 2011/2012.” Statista The Statistics Portal. N.p., n.d. Web. 23 Apr. 2014. <
“Suave®.” Suave Product Description.Suave. N.p.Web. 25 Apr. 2014.
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