This Presentation is prepared by Rahul Ladiya Student of Maulana Azad National Institute Of Technology (NIT) BHOPAL under the guidance of Prof. Sameer Mathur of IIM Lucknow.

2. HISTORY
Boots UK Limited (formerly Boots the Chemists Limited), trading
as Boots, is a pharmacy chain in the United Kingdom and Ireland.
Was Founded By John Boot in 1849 as “The British and American
Botanic Establishment” in Nottingham.
In 1883, established as a private company “Boot and Company
Limited” by Jesse Boot.

3. CHANGE IN COMPANIES LOGO
First Logo Adapted in 1883 NEW Black Logo Adapted in 1949

5. Competitor Brands Retailers Of Same Category
Consumer Behaviour

6. SITUATION 1
MAJOR COMPETITOR BRANDS

8. PROCTER & GAMBLE
•Procter & Gamble Co., also known as P&G, is an
American multinational consumer goods company headquartered
in downtown Cincinnati, Ohio, United States, founded by William
Procter and James Gamble, both from the United Kingdom.
•Procter & Gamble acquired Richardson-Vicks in 1985, and in 1991,
and then the product was reformulated as the Pantene Pro-V (Pro-
Vitamin) line and rolled out to be as a global brand.
•By 1995 P&G became the best-selling hair-care brand in the
•world with a product lineup that included shampoos, conditioners
and styling products for all different hair types
•It held a 8.4 per cent share of the U.K. hair care market in 2001.

10. ALBERTO-CULVER (UNITED KINGDOM)
•Alberto-Culver was an American corporation with international sales
whose principal business is manufacturing hair and skin beauty care
products under such brands as Alberto VO5, Andrew Collinge, St. Ives
(skin care products), TRESemmé, FDS, Consort, and Nexxus.
•The company’s head-office was located in Illinois, but its products
were sold globally.
•Over 60 years, beginning in 1955, Alberto Culver grew into a
multibillion-dollar company. .

12. •L’ORÉAL
•L'Oreal is a French cosmetics company headquartered in Clichy,
Hauts-de-Seine with a registered office in Paris It is the world's
largest cosmetics company and in 2001 it held five percent of the
U.K’ s market share.
• It has developed activities in the field of cosmetics, concentrating
on hair colour, skin care, sun protection, make-
up, perfumes and hair care, the company is active in
the dermatology, toxicology, tissue engineering,
and biopharmaceutical research fields and is the
top nanotechnology patent-holder in the United States.
•L'Oreal's marked with major successes, with landmark products
that offered women new ways and means to enhance beauty. The
group marketed over 500 brands and more than 2,000 products in
all sectors of the beauty business: hair color, permanents, styling
aids, body and skincare, cleansers, and fragrances.

13. •As we talk about the hair-care market in UK, the sales for
popular consumer brands like P&G, L’Oreal, Alberto-
Culver were directly proportional to the advertising
expenditure.
•Therefore the market share of hair-care products was
highly fragmented and among the products of these
brands and Boots saw an opportunity to be the retail hair
care expert and to offer the latest ranges.
•Hence they built up on celebrity endorsements and
hairdresser relationships.
•Research also indicated that the consumers were not
very brand loyal for variety of reasons. BOOT’s mainly
chose between packaging, advertising, price, ingredients,
consistency, fragrance and so forth.

14. Some facts about associated
celebrities and the brands…

15. Name Description Specifics Market
Awareness
1. Charles
Worthington
One of the most influential and
creative hairdressers. His name
is
synonymous with style,
innovation
and success.
• Five prestigious London
salons tending to more
than 2,000 clients a
week.
• Celebrity following on
both sides of the Atlantic
Medium
2. John
Frieda
Entrepreneurial in spirit, global in
impact, John Frieda’s team of
celebrity stylists (the “House of
Experts”) fuels the company’s
new
product initiatives with the inside
track on hot, new celebrity hair
trends.
• Three salons in London,
two in New York and one
in Los Angeles.
• The product range is
targeted for specific hair
types.
Strong
3. Nicky
Clarke
A popular hairstylist to the stars
from
the film, television, fashion, and
music industries.
• Salons in London and
Manchester
Medium

16. Name Description Specifics Market
Awarenes
s
4.
Umberto
Giannini
One of the most esteemed and influential
names in British air dressing. His
company’s philosophy is simple —
creating sexy, contemporary catwalk
looks within its salons alongside a salon
performance range of hair-care products
to recreate catwalk glamor at home.
• Eight salons in
the United
Kingdom
Low
5. Toni &
Guy
“At Toni & Guy we create wearable,
catwalk-led hairstyles for people who
want easy-care, trend-setting hairstyles.
Be an individual; be ahead in the style
stakes with Toni and Guy.”
• 250 salons in the
United Kingdom
Strong
6. Trevor
Sorbie
Trevor Sorbie, is considered as the
showman of all hairdressers. His
pioneering techniques and cuts — the
Wedge, the Chop, and the Scrunch are
now part of everyday salon parlance.
• Two salons in the
United Kingdom
Medium
7. Lee
Stafford
He is known for hairstyle and hair care. • Three salons in
the United
Kingdom
Low

17. Distribution and Introduction dates
Brand Introduced Distribution
Charles Worthington 1996 Only Boots
John Frieda 1996 Widely Available
Nicky Clarke 1998 Widely Available
Umberto Giannini 1999 Widely Available
Toni & Guy January 2001 Only Boots
Trevor Sorbie September 2001 Only Boots
Lee Stafford September 2001 Only Boots

18. SITUATION 2
RETAILERS OF SAME CATEGORY

19. The major competitors in the supermarket brand
segment were Tesco, Sainsbury’s and Morrison's.

20. •Tesco is a British multinational grocery and general merchandise
retailer headquartered in Welwyn Garden City, Hertfordshire,
England, United Kingdom. It is the third largest retailer in the world
measured by profits and second-largest retailer in the world
measured by revenues.
•It has stores in 12 countries across Asia and Europe and is the
grocery market leader in the UK (where it has a market share of
around 28.4%), Ireland, Hungary, Malaysia, and Thailand.
•Tesco was the largest supermarket chain in the United Kingdom
with more than 1,800 stores and 45,000 employees.

21. •Sainsbury's was the second largest with 700 stores.
•Sainsbury's is the second largest chain of supermarkets in the
United Kingdom, with a 16.9% share of the UK supermarket sector.
•It was Founded in 1869, by John James Sainsbury with a shop
in Drury Lane, London, the company became the largest
grocery retailer in 1922, was an early adopter of self-service
retailing in the UK, and had its heyday during the 1980s

22. •Tesco and Sainsbury’s both ,offered a
worldwide product assortment that included
all traditional supermarket items and online
shopping, as well as CD’s, books, DVDs,
wine, flower ,gifts, kitchen appliances,
banking services, and mobile phones.

23. •Morrison's had 400 stores
It had taken over Safeway in the United Kingdom
in 2004.
•Morrison's is the fourth largest chain
of supermarkets in the United Kingdom,
headquartered in Bradford, West Yorkshire,
England. The company's legal name is Wm
Morrison Supermarkets plc.

25. •A second major hair-care competitor was
Superdrug.
•Started in 1966, Superdrug had grown to become
one of the largest health and beauty retailers, with
almost 700 stores in UK.
•Superdrug stores layout, lighting and colour,
allowed customers to move at their own pace in an
attractive setting, thus providing a welcoming and
relaxing environment.

26. SITUATION 3
CONSUMER BEHAVIOUR

27. Research indicated that consumers were not very brand loyal for a variety of
reasons:
First, that there was a general belief by U.K. consumers that changing
shampoo brands produced better results than continuously using a single
brand.
Second, was that trends in buying behaviour led to changing preferences.
Whereas in the ‘70s consumers wanted shampoos that were gentle, the ‘80s
saw a greater emphasis on detangling, and in the ‘90s, shiny hair became
more important.
Third, it was difficult for consumers to identify meaningful differences between
the various brands available in any given store. Consumers had a large
number of choices that varied not only on brand name, but also packaging,
advertising, price, ingredients, consistency, fragrance and so forth.

28. The main problem that company was facing in this case is to
select one of the three promotional alternatives:
• 3 for 2
• GWP (Gift With Purchase)
• On-pack Coupon (50p off)
while keeping all this in mind that there primary objective was to
drive sales volumes and trade up consumers from all the lower
value brands while retaining or building brand equity.
PROBLEM

30. Get 3 for the price of 2
PROS:
•Consumer can get the 3 items for a
regular price of the buy of two.
•Consumers could also combine
any three items as they like e.g.
shampoo, conditioner and styling
gel of same brand and product with
least price would be offered free.
•Estimation was that the sales
would increase to 300% of pre-
promotion sales, and 60% of the
customers would be just
promotional
CONS:
•This will have clear cut indication of the
stock clearing strategy that could impact
the potential customers from buying the
products.
•Premium products could also lose their
brand equity and may sound as some
cheap promotion.
•Product partners (Hair dressers) may
oppose this strategy for the dilution of
their brand equity.

32. Receive a gift with purchase
PROS:
•A Product sample would be
given free along with a
regular purchase.
•Additional packing would be
used to pack the free sample
along with the existing one.
•Estimated sales would
increase by 170% of the pre-
promotional sales.
•40% of the customers would
be just promotional buyers
CONS:
•Adding the sample would
also cost approximately 90p
per unit for the product plus
3p per unit extra to secure
the sample to the featured
product.
•This is a very common
strategy which is used by
most of the retailers and can
be easily imitated.

34. On-pack coupon worth 50p
PROS:
•Customers would be able to
redeem their coupons during
their current store visit.
•Sales are estimated to
increase by 150% of the pre-
promotional sales.
•50% of the customers would
be just promotional buyers.
•Coupons would enable
multiple visits for a single
customer that would lead to
increase the number of sales.
CONS:
•This is a very common
strategy used by most of the
retailers and can be easily
imitated.
•Again this is one of the form of
discounting which can dilute
the brand equity.
•This is more o f a
conservative approach but ,this
option has less estimated
sales growth as per market
research.

35. FINANCIAL ANALYSIS

36. 3 for 2 GWP
50p
discount
Cost of an average item 3.99 3.99 3.99
pre-promotional unit sales/day 100 100 100
percentage increase in unit sales/day 300% 170% 150%
promotional unit sales/day 300 170 150
Number of sets sold 150 170 150
Total Revenue (pre-promotional) 399 399 399
total revenue 1197 678.3 59 8.5
%age change in revenue 200.00% 70.00% 50.00%
Margin earned (pre-promotional) 114 114 114
margin earned 342 193.8 171
%age change in Margin 200.00% 70.00% 50.00%
promotional cost per unit 2 0.93 0.5
total promotional cost per day 300 158.1 75
Profit 42 35.7 96
Accusition of new customers 60% 40% 50%
COMPARING PREMIUM BRANDS

37. 3 for 2 GWP
50p
discount
Cost of an average item 3.99 3.99 3.99
pre-promotional unit sales/day 100 100 100
percentage increase in unit sales/day 300% 170% 150%
promotional unit sales/day 300 170 150
Number of sets sold 150 170 150
Total Revenue (pre-promotional) 399 399 399
total revenue 1197 678.3 59 8.5
%age change in revenue 200.00% 70.00% 50.00%
Margin earned (pre-promotional) 114 114 114
margin earned 342 193.8 171
%age change in Margin 200.00% 70.00% 50.00%
promotional cost per unit 2 0.93 0.5
total promotional cost per day 300 158.1 75
Profit 42 35.7 96
Accusition of new customers 60% 40% 50%
COMPARING MASS MARKET BRANDS

39. PRICE COMPARISION CHART

40. SOLUTION

41. Although Maximum Profit lies with
the 3rd strategy, from Robinson’s
estimates but,
the first promotional strategy
should be chosen,
because by considering the
advantages and disadvantages.
It would be better for the Boots
company to adopt the first strategy
i.e. “3 for 2”.

42. Boots’ aim was to secure market leadership in the
United Kingdom in the hair-care segment.
The celebrity hair-care brands were clearly an
important component of their strategy.
BOOT’s wanted to ensure that the promotions
were profitable, but the importance of maintaining
and enhancing the professional hair-care brands
could not be understated.

43. •It has more estimation of the increase in sales as per the
market research.
•More customers would buy the product.
•This will also help the Boots to push its non-selling brands
in this strategy, as general tendency of the customers is to
buy different brands for different products but this offer
would attract many customers to buy the 2nd or the 3rd
product in the offer of their brand which they otherwise
would not have purchased.

44. •History
•Situation Analysis
•Problem
•Financial Analysis
•Solution

45. This Presentation is prepared by Rahul Ladiya Student of Maulana Azad
National Institute Of Technology (NIT) BHOPAL under the guidance of
Prof. Sameer Mathur of IIM Lucknow.