Introduction

The sector that our group decided to analyze is Healthcare and beauty. This is part of the industry which our group will concentrate on because we would like to know how companies of this sector optimize revenue. The companies that we have chosen is Watsons and guardian which are pharmacies. Both of these brands have similar products and almost the same services. The components that will be highlighted in this report are the companies historical back ground, physical and online presence, products and services offered as well as pricing and distribution channel strategies. In the later parts, there will be a comparison done by using SWOT analysis to about components for better understanding. talk

1. Historical Background
Watsons Personal Care Stores (Malaysia) Sdn Bhd.
Watsons Personal Care Stores (Malaysia) Sdn Bhd. is part of the Health and Beauty Store chain of A.S Watson from Hutchison Whampoa Limited from Hong Kong. Today, Watsons is the largest health, cosmetics, perfumery and beauty retailer in the world and is the leading health and beauty chain in 9 continents ( Hong Kong, China, Singapore, Malaysia, Thailand, Indonesia, Korea, Taiwan and Philippines).

In 1994, Watsons Malaysia opened its first outlet in Holiday Plaza, Johor Bahru. In 2005, Watsons successfully acquired the Apex Pharmacy chain, in which consists of 18 stores nationwide. This significant milestone brought Watsons to a higher level in the pharmacy business. Today, Watsons operates over 250 stores in Malaysia serving more than 50,000 customers per day.

Watsons strives to live up to customers' expectations through marketing campaigns, a wide variety of high quality merchandise at great value and provides an exciting

shopping experience. The wide range of merchandise also covers competitively priced house brand and private label products.

Guardians Malaysia is one of the sector by GCH Retail (Malaysia) Sdn Bhd.
Guardians Malaysia is one of the sector by GCH Retail (Malaysia) Sdn Bhd. GCH Retail (Malaysia) Sdn Bhds business includes Giant and Cold Storage hypermarket. In 1967, Guardian was a 200 square feet pharmacy at the Weld in Jalan Raja Chulan catering to the expatriate community. Today, Guardians have transformed into the larger Pharmacy, Health and Beauty retail chain in Malaysia, offering goods and services to more than 27 million Malaysian consumers.

Guardian's committed to the strong corporate governance, which brought forth an agreement with University Kebangsaan Malaysia and The International Medical University to facilitate a community pharmacy attachment programme to develop a pharmacist in today's ever changing health care environment.

Guardian supports philanthropic by giving back to the community by getting involved in the efforts that help to provide and promote the care, development and well-being of the local communities and supporting programs that are dedicated towards those in need namely, women and children.

2. Physical and Online Presence (kindly refer to appendices page 1)

Physical presence For both Watsons and Guardian, besides their usual newspaper advertisement they also have their own catalogue available at their outlets. The catalogue is to promote and show their latest promotion and products that are on sales to the customers. Through observations, the promotions period printed on the catalogue are

approximately the same as both company start and ends the promotion at the same period of time.

In the Guardian catalogue, they arrange the promotions according to the products brand and category. It is rather confusing and messy as well because customers have to flip every page to look for the products promotion. On the other hand, Watsons catalogue also arrange the promotions according to products brand and category but they have also label the category of the page ie: skincare, cosmetics and others. Besides that, Watsons promote their membership card indirectly by showing the customers how much points are rewarded if they were to purchase the products on the page. Watsons offers a membership loyalty program that are life time and non expiry date membership. This is an advantage for Watsons to attract more customers because customers are able to collect points while buying products in Watsons and redeem their points in cash form in future. As for Guardian, although they offers membership cards but it is only for senior citizens and applicable for healthcare products only. In their catalogue, it is seen that they did not promote the membership card under the healthcare category.

Online presence For Watsons and Guardians they have their own website to show current promotions, beauty and health tips, list of products and stores. Besides that, both of these companies have an existing Facebook account to cultivate fans. When comparing websites, we observed that both companies update their latest info and promotion. Furthermore, these websites also shows beauty and health tips as well as latest news. It was also observed that Guardian has an e-store while Watsons has a membership page for members to check their points and privileges. Whereby their Facebook page showed Watsons has more fans compared to Guardian, which 433,000 and 46,000, the number is increasing from time to time.

Both of the Facebook page, constantly updates daily. However, there are slight differences between these two companies in handling posts. Watsons always share pictures with questions captions, which creates engagement between fans to reply while Guardians captions are short statements.

Watsons shows more promotional products photos compared to Guardian.

3. Products and Services (kindly refer to appendices page 2 & 3)

Upon visiting the outlets Guardian and Watsons at Sunway Pyramid, there were a few criterias we decide to concentrate on and one of them were the products and services. When comparing both the outlets in terms of product range, it seemed to be that Guardian had more products to offer compared to Watsons. They had a wider range and this could also be due to the bigger outlet space the outlet had. They way the products were displayed on the shelves in Guardian were neat and tidy and well replenished. Watsons also had replenished their items, but the space was quite crammed and the items were not as neatly arranged. In terms of signage, it was analyzed that Guardian had better signage and as a consumer, once you enter the store, the signages will easily direct you to the item you are looking for which is very helpful. Watsons also had signages, but it was rather small and not as appealing as the one at Guardian store.

Besides the signages, there was a small comparison done to observe the range of mens products and it was concluded that the mens section is guardian had a wider range of products. Another interesting point which we observed was at the pharmacy area in both the stores was that guardian had an enclosed area for consultation services and medicine with the pharmacist. Watsons on the other hand only had the usual pharmacy where theres a simple counter provided for purchasing of medicine. In our opinion as consumers, we would like to add that we feel Watsons caters more to a younger target market, and Guardian caters to a more senior target market.

This can be observed just by the outer appearance of both stores in comparison as well as the member ship card subscription and it is observed that both the stores have membership card, but for different target markets with Guardian catering to senior citizens only and Watsons, for all ages. As for services, it was analyzed that the staff at Watsons were younger than the ones at Guardian and there were booths provided at Guardian which were promoting some of their latest products but none were found in Watsons. Overall, it is safe to sum up that Guardian and Watsons have designed their store and prepared services to provide for their specific target market. Upon entering the stores, one can experience a different vibe or feel due to the way the stores are arranged. Even the music played in Watsons was for a younger crowd, hence the difference in added service for guardian like the big signage and consultation to cater to senior citizens needs.

Pricing and Distribution Channel Strategies

4 & 5)

(kindly refer to appendices

An observation was done to look at the pricing of both company. The product chosen to observe the pricing are Guardian and Watsons respective hand wash, Blackmores (Healthcare) and Sunsilk (Hair care) products. Guardians hand wash are selling at RM5.90 per bottle and they are having promotion which is 3 bottles for RM10.88. Through this promotion customers can save RM6.82. Whereas for Watsons, the hand wash is RM 6.90 per bottle and they are having promotion which is buy 2 free 1. Through this promotion customers save RM6.90 but they are paying RM2.92 more compare to Guardian. However, in Watsons, customers can collect 2x points for purchasing Watsons brand products. Blackmores Primrose Oil + Fish Oil is selling for RM40.90 (30s) and RM 123.00 (120s) in Guardian whereas in Watsons it is selling for RM34.85 (30s) and RM

105.83 (120s). From the comparison, Watsons is selling the healthcare product cheaper compare to Guardian. Even though, Guardian have PWP (Purchase-withpurchase)discount but it contains term&conditions which is to purchase RM50 and above in a single receipt. Lastly, we will look at the hair care product, Sunsilk. In Guardian, Sunsilk Smooth & Manageable Shampoo (320ml) is selling at RM 9.88 whereas in Watsons is selling at RM10.80. As seen, Guardian is selling at a cheaper price compare to Watsons. However, Guardian is selling at a promotion price.

In distribution channel, each layer of marketing have intermediaries that performs some work in delivering the products to the final buyers is a channel level. There are 3 channel levels and both Guardian and Watsons fall under channel 2 which contain one intermediary. They are consider as intermediary because they take products from the producers and then deliver them to the consumers. Both Guardian and Watsons deliver the producers product by putting them in their outlets around Malaysia. As producer of healthcare products, Guardian will be easier to approach if they want to boost their sales because Guardian provide more healthcare products compare to Watsons. However, both acts as intermediaries have additional functions such as provide the product information to the customers, provide variety of products to the customers. At the same time, both company are located at convenience places to reach out to their customers.

SWOT Analysis
SWOT analysis below only applicable in Sunway Pyramids Watsons and Guardians store: 1.Watsons Strength 1. Customer loyalty from all age group as there is no age limit to register for loyalty membership, hence wider target market. 2. More foreign products available in store to attract expatriates and consumers. Opportunity 1. Increase brand name as there is more activities liaised with Watsons. eg. Concerts 2. Notifications of promotions and loyalty points for customers to encourage them to visit. Weakness Product arrangement is not as tidy as Guardian and did not fully replenish their products. 2. The walkway between shelves are too narrow causing congestion which affects appearance of store 1. Threats Other pharmacies in Sunway Pyramid causing competition. 2. Lower prices offered at Guardian may create slight competition 1.

2.Guardian Strength 1. Specialized services like private consultation room is available for the consumer. 2. Items are cheaper which attracts more consumers. Weakness 1. Target market too narrow, for example, loyalty cards only available for senior citizens on medication purposes and healthcare products. 2. Lack of promotional materials on site for customers. Threats 1. Targeted mainly to senior citizens, hence business loses out on other target market to similar businesses. 2. Products can be found in supermarkets and hypermarkets.

Opportunity 1. E-store available for consumers 2. Shopping friendly environment to find items quickly and more cashiers to service consumers, hence showing efficiency in business.

Conclusion
Overall, both stores are well equipped and have similar products and services. Considering that Guardian is more established than Watsons, Watsons has managed to outsell itself better and gage consumers attention. Having mentioned the loyalty card, many promotional materials, and young generation they cater to, they have succeeded in attending to consumers needs. Guardian on the other hand has managed to maintain a trustable business, however, they are not as well prepared to capture consumers attention to their products or attract consumers into their store. The number of people in the store at the time of our field observation was little in Guardian compared to Watsons.

Having said that, our company Watsons as when compared to our competitor Guardian, we observed that it is performing better in terms of consumer gage, however, there needs to be an uplift in the store appearance. Some of the signages should be bigger and the store needs to be neat and tidy so consumers can find their products easily. In terms of store size, there should be wider space area for easier roaming of consumers in the store itself. As for the methods of revenue maximization, the idea that we came up with for Watsons is to open up vending machines equipped with daily products that consumers might need such as sanitary pad, sanitizer, hand plaster, tissue, safety pins and etc.

This could cater to a target, which need to make a fast transaction, or in need of something urgent. Watsons will be able to make extra revenue on the side with implementation of vending machines and they could station these machines at public areas like universities, schools, office blocks and etc. Another strategy is to have a Watsons Express store, which is somewhat similar to the vending machine but provides a wider variety of products. This store can be placed at areas such as

housing areas, apartments and condominium with a more flexible operating hour so that residents can have quick purchases of any items they need instead of going into town. Overall these are the strategies proposed for Watsons and we believe that it would give them a chance to optimize revenue.