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Differentation Marketing In Commoditized Categories - Remington Womens Haircare

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This case study demonstrates the power of innovation and how it can help turnaround a business even in a commoditized category. All it takes is vision and the desire to better understand consumer need gaps. Remington Products women's haircare business exploited new opportunities in very mature markets and this helped to turn their business around.

Rick Steinbrenner - The Global Brand Guy

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Differentation Marketing In Commoditized Categories - Remington Womens Haircare

  1. 1. 1 Women’s Haircare Business Differentiation Marketing In Commoditized Categories
  2. 2. 2  Background: Victor Kiam of Remington bought the Clairol women’s haircare business in the mid 90’s (without the Clairol brand)  Haircare business eroded from ~$40MM to <$25MM (1998) (post-Clairol acquisition)  Market ranking: # 5 player - #5 player in hair dryers, #2 player in hot rollers, no presence at all in curling irons (source: NPD).  Conair and Helen of Troy (#1 and #2) had 100% distribution due to full line of haircare products and strong brand equity.  Remington products were essentially “me-too” with the exception of some key sku’s in Hot Rollers. Could only compete on price.  Consumer understanding of haircare purchase behavior not well understood – by Remington or the competition. Women’s Haircare Business Situation
  3. 3. 3 Haircare Business Actions Consumer Segment Frustrated/Skeptical Users 46% of Users Appearance Driven Users 29% of Users Self-Reliant Users 25% of Users Consumer Profile  Problem hair  Not confident about getting salon-style results  Haircare appliances rarely “work”  Willing to get it right, but easily frustrated  Hair enthusiast  Invests lots of time styling  Will pay premiums for new ideas/solutions  Changes hair style to match latest trends  Uninvolved – low fuss  Low maintenance styling  No time for styling  Looking for good value  Doesn’t change hair style much Positioning Tools for Problem Hair Tools for Today’s Hair Styles Tools for Style N’ Go Hair Salon-style results despite problem hair Professional salon results at home Get fast stylesConsumer Benefit: Haircare Market Segmentation Source: 2000 Haircare A&U Study  Women had differing attitudes about their hair and how much time/effort they were willing to spend to get the results they wanted.  Most competitive products focused on appearance driven users – only1/3 of the market.
  4. 4. 4 Women’s Haircare Business Actions Consumer Problem:  Conventional 1875W dryers blew hair everywhere leaving “problem hair”.  Result:  Takes a much longer time to dry  Potentially damages hair due to overheating The Vortex Jet Speed Dryer solved this problem:  Patented cyclonic airflow technology lifted up hair at the roots and dried it from the “inside-out” vs. blowing from the “outside-in”.  Result:  Dried hair in ½ the time  Made hair more manageable  Protected hair from overheating/damage
  5. 5. 5  The Vortex became the #1 hair dryer for two years in a row in the single largest category in Haircare (over 400 SKU’s).  The Vortex forced the exit of Applica, Inc. from Haircare.  Doubled sales/profits (15% ROS, 10% $ share) to $45M restored Remington to Clairol pre-acquisition sales levels.  Moved overall Remington haircare share from #5 in the category to #3.  Haircare study also resulted in new insights in other new products and merchandising.  New planogram consistent with study was tested at Wal-Mart for potential rollout nationwide. Women’s Haircare Business Results
  6. 6. 5  The Vortex became the #1 hair dryer for two years in a row in the single largest category in Haircare (over 400 SKU’s).  The Vortex forced the exit of Applica, Inc. from Haircare.  Doubled sales/profits (15% ROS, 10% $ share) to $45M restored Remington to Clairol pre-acquisition sales levels.  Moved overall Remington haircare share from #5 in the category to #3.  Haircare study also resulted in new insights in other new products and merchandising.  New planogram consistent with study was tested at Wal-Mart for potential rollout nationwide. Women’s Haircare Business Results

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