BOOTS: HAIR-CARE SALES PROMOTION Case Study of BOOTS: HAIR-CARE SALES PROMOTION Disclaimer Created By- Tarun Yadav Marketing Internship by Prof. Sameer Mathur

1. C A S E S T U D Y A N A L Y S I S
H A R V A R D B U S I N E S S R E V I E W
BOOTS: HAIR-CARE
SALES PROMOTION

2. OBJECTIVES
About The Company
Competition Analysis
Promotional Alternatives
Optimal Strategy
Solution
B O O T S : C A S E S T U D Y A N A L Y S I S

3. FOUNDED IN 1849
BY JOHN BOOTS
ESTABLISHED IN 1883 AS A
PRIVATE COMPANY
A B O U T T H E C O M P A N Y

4. Boot Opticians, formed in 1987, became one of
the United Kingdom’s leading chain of opticians.
In 2012, Walgreens bought a 45% stake Alliance
Boots, with the option to buy the rest within
three years. It exercised this option in 2014, and
as a result Boots became a subsidiary of the
new company, Walgreens Boots Alliance, on 31
December 2014.
RECENT
UPDATES

5. Procter & Gamble
Alberto-Culver
L’Oreal
COMPETITOR
BRANDS

6. THE RAW DETAILS
For 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.
The market share for hair-care products was highly fragmented 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 indicated that the consumers were not very brand loyal for variety of
reasons. They mainly chose between packaging, advertising, price, ingredients,
consistency, fragrance and so forth.
Most Boots consumers bought both basic and premium brands.

7. C
C E L E B S & B R A N D S
A S S O C I A T E D

8. COMPETITION IN
SUPERMARKET
SEGMENTS
The major competitors in the supermarket
segment were -
Tesco
Sainsbury’s
Morrisons

9. THE RAW DETAILS
T H E B A S I C S
S O U R C E : W I K I P E D I A & H B R C A S E
Tesco was the largest supermarket chain in the UK with more than 1,800
stores and 45,000 employees.
Sainsbury’s was the second largest with 700 stores. Both Tesco and
Sainsbury’s offered a wide product assortment that included traditional
supermarket items and online shopping, as well as CD’s, books, DVDs,
wine, flower and gifts, kitchen appliances, banking services, and mobile
phones.
Morrisons had 400 stores and prided itself on providing quality products
at the same low price across all of its U.K. stores. Morrisons had taken
over Safeway in the United Kingdom in 2004.

10. 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.

11. There was a general belief by U.K. consumers that
changing shampoo brands produced better results than
continually using a single brand.
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.
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.
BRAND LOYALTY?

12. 3 for 2
GWP (Gift With Purchase)
On-pack Coupon (50p off)
PROMOTIONAL ALTERNATIVES

13. Consumer would get 3 items for a regular price
buy of two.
Consumers could 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.
Most competitors did not have the technology at
the point of sale to imitate this promotion.
Estimation was that sales would increase to 300%
of pre-promotion sales.
60% of the customers would be just promotional
buyers.
This will have clear cut indication of the stock
clearing strategy which could impact potential
customers from buying the products.
Premium products would lose their brand equity
and may sound as some cheap promotion.
Product partners(Hair dressers) may oppose this
strategy for the dilution of their
ADVANTAGES DISADVANTAGES
3 for 2

14. 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.
Adding the sample would 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 used by most of
the retailers and can be easily imitated.
RECEIVE A GIFT WITH PURCHASE
ADVANTAGES DISADVANTAGES

15. 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.
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 of a conservative approach.
This option has less estimated sales growth as per
market research.
ADVANTAGES DISADVANTAGES
ON-PACK COUPON WORTH 50P

16. ANALYSIS OF EACH
STRATEGY
C H O O S I N G T H E O P T I M A L M O D E L
S O U R C E : H B R C A S E R E V I E W

17. PRICE COMPARISON CHART

18. S S O L U T I O N
T H E
T H E M A X I M U M P R O F I T L I E S W I T H T H E 3 R D
S T R A T E G Y , F R O M T H E E S T I M A T E S A N D A L S O H A S
T H E F O L L O W I N G A D V A N T A G E S -
1 ) C O U P O N S W O U L D E N A B L E M U L T I P L E V I S I T S F O R
A S I N G L E C U S T O M E R .
2 ) M O R E C U S T O M E R S W O U L D B U Y T H E P R O D U C T .
3 ) I T I S E A S Y T O I M P L E M E N T

19. S S Y N O P S I S
T H E
I N T H I S P R E S E N T A T I O N T H E R E W A S A C O M P L E T E
A N A L Y S I S O F B O O T S W H I C H I N C L U D E D -
A B O U T T H E C O M P A N Y
C O M P E T I T I O N F A C E D B Y T H E C O M P A N Y
P R O M O T I O N A L S T R A T E G I E S A V A I L A B L E T O T H E
C O M P A N Y
O P T I M A L S T R A T E G Y F O R T H E C O M P A N Y

20. D D I S C L A I M E R
T H E
CREATED BY
TARUN YADAV
Marketing Internship By-
Prof. Sameer Mathur
IIM Lucknow