BOOTS: Hair Care Promotion Strategy

•  Sales volumes should increase for its hair care products

•  Attract consumers from the lower value brands

•  Build and retain the brand equity

•  Consider the competitors (Hair Care & Retail Stores)

Promotion Objectives:

Get  three  for  the  price  of  two  (“3  for  2”)  

Receive  a  gi7  with  purchase  (“GWP”)  

An  on-­‐pack  coupon  

Promotion Alternatives:

“3  For  2”    Offer        

•  buy two hair-care items at regular price and receive one free

•  three items had to be of the same brand

•  least expensive of the three items would be free

Gi7  With  Purchase  (GWP)  

•  a product sample along with a regular purchase

•  existing sample product would be used to avoid the need to design and produce additional packaging

On  Pack  Coupon  

•  Consumers will get 50p off on their purchase.

•  All customers would be able to redeem the coupon during their current store visit.

COUPON  

Advantages   Disadvantages  Consumer  would  get  3  items  for  a  regular  price  buy  of  2  

Would  be  perceived  as  a  Stock  clearing  strategy  

Consumers  could  combine  any  3  items  as  they  like  e.g.  shampoo,  condiNoner  and  styling  gel  of  same  brand  

Premium  products  would  lose  their  brand  equity  and    may  sound  as  some  cheap  promoNon  

Most  compeNtors  did  not  have  the  technology  at  the  point    of  sale  to  imitate  this  promoNon  

Product  partners  (Hair  dressers)  may  oppose  this  strategy    for  the  diluNon  of  their  brand  equity  

EsNmaNon  was  that  sales  would  increase  to  300  %  

60%  customers  –  promoNonal  buyers  

“3 for 2”

Advantages   Disadvantages  Product  sample  would  be  given  free  along  with  a  regular  purchase  

Adding  the  sample  would  cost  approx.  90p  per  unit  for  the  product  plus  3p  per  unit  extra  to  secure  the  sample  to  the  featured  product  

EsNmated  sales  would  increase  by  170%  of  the  pre-­‐promoNonal  sales    

This  is  a  very  common  startegy  used  by  most  of  the  retailers  and  can  be  easily  imitated  

40%  of  the  customers  would  be  just  promoNonal  buyers  

GWP

Advantages   Disadvantages  

Customers  would  be  able  to  redeem  their  coupons  during  their  current  store  visit    

This  is  a  very  common  strategy  used  by  most  of  the  retailers  and  can  be  easily  imitated  

EsNmated  sales  would  increase  by  150%  of  the  pre-­‐promoNonal  sales    

Form  of  discounNng  which  can  dilute  the  brand  equity  

50%  of  the  customers  would  be  just  promoNonal  buyers    

More  of  a  conservaNve  approach  

Coupons  would  enable  mulNple  visits  for  a  single  customer  

Less  esNmated  sales  growth  as  per  the  market  research  

On pack coupon

Alterna/ves   3  For  2   GWP   On  Pack  Coupon  

Cost  per  bo`le  (Pounds)   1.4   1.4   1.4  

EsNmated  Sales  for  1  Day   300  Units    170  Units   150  Units  

Promoitonal  Cost  per  Unit   ProducNon  cost  ProducNon  cost  +    

Sample  cost  ProducNon  cost  +    Discount  cost  

Promoitonal  Cost  per  Unit  (Pounds)   1.4   2.33   1.9  

Total  Cost  (Pounds)   420   396.1   285  

Total  Revenue  (Pounds)   600   340   300  

Net  Profit  (Pounds)   180   -­‐56.1   15  

Quantitative Analysis

“3  For  2”    300%    

Increase  in  sales    

60%  New  Customers  

added!!!  

 

Increasing  Sales  

Capture  new  Customers  

DISCLAIMER

Created by Akshay Julka(DTU, Delhi), during a Marketing

Internship under Prof. Sameer Mathur, IIM Lucknow.