ACADEMIC PROJECT MARKETING MANAGEMENT - II

Section F, Group-2 GROUP MEMBERS:ANURAG KHAN - 11IB-012CHHAVI SRIVASTAVA - 11DM-033DHIRAJ JAIN - 11DM-036NIMISH VARMA - 11FN068SHRUTI MITTAL - 11IB-056SRINIVASA NAREN K - 11FN-108

LOreal
LOreal was founded in the year 1909 by Eugene Schueller, a French chemist who developed an innovative hair color formula. Today, the LOreal Group is the world's largest cosmetics and beauty company and its headquarter is in the Paris suburb of Clichy, France. It got its start from the hair color business but soon it developed activities in the field of cosmetics, concentrating on skin care, sun protection, make up, perfumes and hair care. ). It is also the top nanotechnology patent-holder in the United States. L'Oreal is one of the most successful International premium brands in India. This French brand came to India in 1991 with its Ultra Doux range of Shampoo through its Agent Laboratories Garnier. In 1994 Laboratories Garnier became the 100% subsidiary of L'Oral. In 2000 LOreal launched its range of cosmetics in to Indian market. The Indian Cosmetic and skin care market is estimated to be around $300 Million. In this market the Color Cosmetic segment is around Rs 250 crore while the Skin care segment is estimated to be around Rs 400 crore. L'Oral's strategy is to evolve Garnier into a master brand, stretching across categories that over the next few years would include soap, body wash and facial care, similar to Unilever with Dove. "Fructis shampoo is core, and they are introducing styling aids as part of a mega brand strategy.

LOreal operates in India through four main divisions: consumer products, professional products, active cosmetics and luxury products.

Consumer products
L`Oreal Paris Garnier Maybelline NY

Professional products
L`Oreal Professionnel Kerastasse Matrix Keraskin esthetics

Luxury products
Lancome Giorgio Armani Ralph lauren Diesel Kiehls

Active cosmetics
Vichy La roche-posay

Garnier The biggest contributor to its revenue in India is the consumer products division led by its strongest brand in terms of sales Garnier. In the hair color segment, Garnier operates in the mid-price and luxury segment. This has enabled it to garner a 20 per cent share in a market dominated by local hair colorants and dyes.

Garnier mainly produces hair care products, including the Fructis line, and most recently, skin care products under the name, Nutritioniste, that are sold around the world. One of their key ingredients is a fruit concentrate used in all their products. It is a combination of fruit acids, vitamin B3, B6, fructose and glucose.Garnier, the L'Oreal-owned brand that shook up the US hair care market with the introduction of Fructis in 2003, now has plans to bring over its skin care collection too. In 2000 LOreal launched its range of cosmetics in to Indian market. Garnier concentrated on the Natural Hair care market with the main USP of strong hair. The brand positioned as a Unisex brand mainly used its international campaigns in India to appeal to the Indian consumer. Garnier believes in beauty through nature. Scientifically developed and enriched with selected natural ingredients, its products help look healthy and feel good every day. Garnier has been able to establish itself firmly in the Indian market and has clearly defined its target market which is the middle class and the upper middle class segment. Garnier has very effectively designed its promotional strategies by adapting to the changing customer demand. It has penetrated firmly in the Indian market both in skin care as well as hair care products covering a wide range from shampoos, conditioners, to gels, serums, hair mousse, anti-acne ointments, anti-wrinkle creams etc. The accessibility factor of Garnier products has been taken care of by the company by ensuring easy availability of its products in almost all confectionery item stores to malls and kiosks.

GARNER PRODUCT MIX

Skincare
Pure

Body care
Body cocoon

Deodorants
Mineral women Mineral men

Hair care
FRUCTIS SHAMPOO FRUCTIS CONDITIONER

Styling
Hard

Hair colour
Color naturals

Pure active Essential care Nourishing cold cream Face wash Sun control Light Men power light

Wetshine Styling gels

Wrinkle lift Age lift

Product-Mix Width 6 Product-Mix Length -19 Average product length:Total items = 19 Width =6

Average product length = 19/6 = 3.16

Depth:Skincare
Pure- 1

Body care
Body cocoon-1

Deodorants
Mineral women2 Mineral men-2

Hair care
FRUCTIS SHAMPOO26 FRUCTIS CONDITIONER-12

Styling
Hard-2

Hair colour
Color naturals-8

Pure active-2

Wetshine-2

Essential care-3 Nourishing cold cream-1 Face wash-4 Sun control-2 Light-4 Men power light-3 Wrinkle lift-1 Age lift-2 Shampoo Fructis fall fight Fructis seek&shine Fructis normal hair Fructis kids X 2 (mango + strawberry) Fructis long & strong Fructis damage repair Fructis shampoo + oil Fructis anti-dandruff 100ml 200ml 400ml

Styling gels-2

sachet Cond-90 y N y N y y Y Y y y y N y y-100 n N

Cond 180

Only one of these Y y Y y Y Y Y y Y y Y Y Y Y

y y N y n Y Y

y y n y y-200 n N

Cond sachet N N Y n y y n N

Total depth : 80 Consistency 1. All products of Garnier are Cosmetic products so they follow similar distribution channel. 2. Active Natural Ingredients : Given an equal level of performance, garnier gives preference to active natural ingredients with proven effects. It is consistent under garniers Take Care initiative under which it takes care of the environment by using natural ingredients.

PRODUCT - GARNER FRUCTIS SHAMPOO

HAIR CARE INDUSTRY IN INDIA- MARKET ANALYSIS

The hair care market in India is valued at $200 million. It has registered a growth of 3.8% over the previous year. The hair care market can be segmented into hair oils, shampoos, hair colorants & conditioners, and hair gels. According to A C Nielsen (the world's leading marketing information company), hair colorants, feminine hygiene, and baby care have accelerated growth in personal care market. Hair colorants are substitutes for hair dye to counter graying hair. Hair colorants indicate strong growth trends with a year over year growth of 8 per cent. Gone are the days when hair conditioners and hair colorants were used occasionally to look beautiful. Today, they have become the way of life. Today, if there are more brands in the Indian market, its largely due to demand. For instance when hair colors first came to India, more than a decade ago, it was largely to cover grey hair. But with the increasing number of youth in the country; it has become a fashion statement, especially with the young and trendy. Thats why all the players have plans to modify existing

products, launch new products and target different geographic segments and age-groups. However, hair conditioners in India still face a difficult market due to long established habit of using hair oil and ayurvedic treatments, as they are cheaper for consumers and lack the chemicals of conditioners.

Figure 1

The major players in hair colorants category are Godrej, Garnier, L'Oreal, and Lakme. The hair oil market is valued at Rs. 6 billions. Hair oiling is a major niche in the hair care segment. Unlike market abroad, India has a large quantity of consumers whose hair care expenditure also includes hair oils. The penetration level of hair oil is around 87%. Around 50% of the population uses hair oil every day. The growth rate of hair oils in rural India is faster than the growth rate in urban India. The major players in hair shampoo category are HLL, Marico, and Dabur India. Hair gel market segment is at a primary stage and not many local brands are available in India. Hair gels/creams are mainly used for hair grooming by men and is used as a fashion accessory. The market penetration of hair gels/creams is very low, and is limited to a small section of the urban market.

EVOLUTION OF SHAMPOOS IN INDIA

HLL has been an undisputed leader in this market from early 90s from where the concept of shampoos got consideration. In 1964, Sunsilk was launched on a general or a normal shampoo platform.

In 1971, Clinic Plus was launched on a different platform as a health shampoo for family usage.

P&G launched for the first time, an anti-dandruff shampoo in 1987. Sunsilk re-launched in 1987 - Shampoo + Conditioner with Sachet packs. This time, it was launched on a beauty platform with a new variant in its packaging.

HLL goes rural with Sachet shampoo concept. HLL was the first company to target the rural market with shampoos.

P&G later launched Clinic Active in 1991 focusing more on the health platform by introducing pro Vitamin B in its shampoos.

Sunsilk re-positioned and re-launched in 1994 (Nutracare) - Pink for dry hair, yellow for normal hair, green for oily hair and black for long hair.

This stage marked the entry of competition in India due to certain factors such as the burgeoning middle class, a huge untapped market, low penetration levels, rising awareness of the youth.

P & G enters India in Nov 1995, with the worlds largest selling brand - Pantene Colgate Palmolive launched Optima also in Nov 1995 ( breakthrough in Keratin treatment ) Nirma launched Nirma Shampoo which went into rough weather because it also had a detergent and soap with the same name. The brand name also had low price connotations.

In mid 1997, per capita consumption of Shampoo increased Of the Rs. 350 Cr. Shampoo market, the AD segment accounted for a 20 % share P & G launched its internationally acclaimed A & D shampoo H & S in 1997 with Zinc Pyrithine (ZPT) - a unique anti-microbial agent. There were 2 variants - regular and menthol

Sachet sale became 40 % of all shampoo consumption in the country. Clinic, Sunsilk, Organics and Lux and their various brand extensions dominate the shampoo market.

In 1998, the company re-launched Clinic and Sunsilk brands. Sunsilk was re-launched with Fruitamins. Today HLL has a 63 % market share in the shampoo market. In South India, Clinic Plus and Clinic All Clear put together have a market share of about 70 % While toilet soaps have reached saturation, there is immense potential for penetration of shampoos into Indian households.

According to NCAER, Shampoo penetration is expected to grow from 314 thousand households in 1998-99, to 506 per thousand households in 2008-09.

GARNER FRUCTIS SHAMPOO

4Ps

Product:
At Garnier, they combine high performance, effective formulae with active natural ingredients, to create caring products that take care of us, our skin and our hair.Their aim is to work in harmony with the way we are, and make a real difference to who we can be. Garniers highly effective, innovative beauty products have always been inspired by nature and wherever possible, they use active natural ingredients. For Garnier, beauty on the outside is the direct result of care on the inside.

There are 8 kinds of garnier fructis shampoos that are introduced in the Indian market. 1. Garnier Fructis Daily Care Gentle enough for everyday use, it nourishes, strengthens and smoothes each hair strand, keeping it balanced and healthy-looking. Hair is up to 5x stronger, up to 5x smoother and so much shiner. The result: Great-looking hair that is anything but ordinary.

2. Garnier Fructis Color Shield

Specially created to care for color-treated or highlighted hair, it penetrates inside the hair to moisturize and strengthen it. With UV protectant, the formula helps keep your color-treated

hair brilliant and shiny on the outside. Hair is up to 5x stronger, up to 5x smoother and so much shinier, so color looks brilliant longer.

3. Garnier Fructis Moisture Works

This creamy system helps restore moisture in dull, brittle or dry hair. Moisture is replenished and brilliant shine returns. Hair is up to 5 times stronger, up to 5 times smoother and so much shiny

4. Garnier Fructis Sleek & Shine

It's specially created to smooth dry, unmanageable hair and contains Nutritive Fruit MicroOils - an innovative combination of apricot and avocado oils, and vitamins B3 and B6. Hair is 5x stronger, 5x smoother and so much shinier. The result: Long-lasting frizz control for hair that's incredibly sleek, even with moisture in the air. 5. Garnier Fructis Length & Strength Stronger hair grows even longer. It's the first anti-breakage system with Reinforced Active Fruit Concentrate - an innovative combination of vitamins B3 and B6, fructose and glucose. Specially created for hard-to-grow-long hair, this system reinforces hair, protecting it from breakage and split ends.

6. Garnier Fructis Anti-Dandruff

this double-action formula is gentle on your scalp, but ruthless on dandruff. It's a powerful force for healthy-looking hair and the confidence that comes with it. It helps eliminate the symptoms of dandruff, effective with the first wash, and makes your hair up to 3 times stronger!

7. Garnier Fructis Strength & Repair

Garnier Fructis introduces the Strength & Repair System to help reverse the signs of damage in one week, leaving hair intensely nourished, repaired from the inside out and more resistant to breakage.

8. Garnier Fructis Kid

Strengthens the childs hair against damage, helps prevent split ends. It gives soft manageable hair for kids and big broad smiles for Mommies. Ophthalmologically tested, the formula is so gentle that it does not sting the eyes.

Garnier products are all very environmentally friendly. They take the inspiration from nature by selecting active natural ingredients and also behave environmentally responsible. All the Garnier products are the result of rigorous research and development and benefit from the expertise of many multi-disciplinary scientists & research staff working on both fundamental scientific and cosmetic research. Garnier only uses methodologies recognised by the international scientific community as part of its product and claim development process. This process evaluates the safety and effectiveness of ingredients, finished products and marketing claims. The British Skin Foundation has been working closely with Garnier and its Skincare Research Programme for over 5 years, and it is the only skincare manufacturer to have received its accreditation. Garnier takes great care in ensuring products are not harmful or detrimental

to skin health The British Skin Foundation recognises the quality and thoroughness of its extensive research.

Price
Although positioned as a premium offering, the brand was wise enough to price it reasonable enough. The target segment for any product is that homogeneous group of people which is purported to be the most potential customer for the product. The market follows the Pareto Principle, which says that 80 per cent of the sales come from 20 per cent of the people. Then that major marketing efforts of companies attempt to attract the most potential group. In the present stage of immense competition, companies are required to effectively plan their pricing strategies to not only retain current customers but to also expand the customer base by targeting new segments with an aim to convert them into loyal customers. Trying to strike a balance in its pricing strategy for the Indian market, `L'Oreal India Private Ltd believes that by introducing more stock keeping units (SKU's) it will be able to tide over the steep pricing of its products.

Anti dandruff: 127 Damage care: 117 VLCC dandruff: 160 Shahnaaz: 500 Dove: 117 Head and shoulders: 129 Himalaya anti dandruff shampoo: 120 Clinic plus:

Place
As we know the brand loyalty of Garnier is very high and hence Garnier follows a pull strategy. Customers of Garnier go to the retailers and buy the products.

DISTRIBUTION CHANNEL: - Second Level Consumer Marketing Channel

1.

2.

3.

Manufacturer

Wholesaler

Retailer

4.
Consumer

Garnier Fructis is the most recognizable brand of Garnier. It has a got a huge country wide presence. In India, the hair care product of Garnier i.e. Garnier Fructis Shampoo is available in organised as well as unorganized retail shops. Garnier manufactures its products in Pune whereas its registered office is in Mumbai. To popularize its product line LOreal has occupied brand corners in many big malls and retail outlets in which Garnier products get a major chunk. Money-spinning mass-market product of Garnier is Garnier Fructis Shampoo is being pushed hard in India, where the company estimates there is a market of 50 million. Garnier Fructis Shampoo is easily available for sale on many websites in India.

Promotion:
Garnier's positioning strategy is more product based in the sense that it has tried to emphasis individual product properties rather than a common brand image. Most of its commercials are emphasizing on product strengths and innovation. The brand is an example of the success of rational product based advertising success. The brand is also sending a message that Indian consumers are also influenced by rational messages and product innovations rather than mindless emotional bhal blah. On social networking sites like FB it has pages that gives information about the companys new offerings and try to create the brand awareness. Also through the sites it stresses the fact that how much scientific research goes in making one product that creates all the more trust in the product. Various apps are designed to instill in consumers interest. One such example is Take fructis hair quiz. After taking the quiz the app comes out with what kind of shampoo to use and what suites you well.

The snapshot of the quiz is as follows:

The snapshot of its facebook page:

Garnier has been very active and upfront in adopting new promotional techniques to market its products. The company follows a very popular technique to advertise and market its products that is the Viral Marketing policy. Viral marketing is a term coined to define the productive ways a marketing message is made available. And corporate are using the medium to circulate brands and brand messages. When Garnier launched its Fructis shampoo, they latched on to the idea. The firm had to introduce the aspect of five times stronger hair and the firm had a braid competition whereby consumers could register on a site and create a knot on the Fructis braid, as part of their entry into the contest. The knot creation was actually created (visually presented on the site) and as a next step, consumers were expected to invite their friends to visit the braid and add to their score. "A record 76,000 consumers created their own knot on the braid and forwarded the link to more than 82,000 of their friends,'' said a LOreal spokesperson. Garnier has positioned itself as a lifestyle product mainly targeting teenagers and young girls. This is very evident from Garnier ads be it for Garnier fructis shampoos or for hair color. In a recent advertisement of Garnier hair color, a daughter advises her mother to try the product and thus makes an attempt to promote product among middle-aged women. Hence, expanding the base of the target segment gives a whole new market to marketers, provided they are successful in convincing the customers of the second-rung segment.