1. BOOTS - feel good 2. OBJECTIVE OF THE CASE 3. SALES PROMOTION STRATEGY 4. WHAT IS BOOTS? 5. Situation analysis 6. About the company… 7. COMPANY’S EARLY DAYS 8. 9. The MODERN ERA 10. 11. associated celebrities and the brands. 12. CHARLES WORTHINGTON 13. JOHN FRIEDA 14. NICKY CLARKE 15. UMBERTO GIANNINI 16. TONI & GUY 17. TREVOR SORBIE 18. LEE STAFFORD 19. competitors 20. P&G 21. ALBERTO CULVER 22. LOREAL 23. TESCO 24. MORRISON 25. SUPERDRUGS 26. CONSUMERS – NOT VERY BRAND LOYAL…..WHY? 27. CONSUMER’S VIEW/ PERCEPTION - CHANGING BRANDS GIVE BETTER RESULTS 28. CHANGING TREND IN BUYING BEHAVIOUR - 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 29. TOO MANY OPTIONS…-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 30. DECISION – 31. 3 PROMOTIONAL ALTERNATIVES 32. 3 for 2 33. GIFT WITH PURCHASE 34. and 35. ON PACK COUPONS 36. 3 FOR 2 ADVANTAGES 37. 3 FOR 2 DIADVANTAGES 38. GWP ADVANTAGES 39. GWP DIADVANTAGES 40. ON PACK COUPONS ADVANTAGES 41. ON PACK COUPONS DISADVANTAGES 42. COSTS AND EXPENSES 43. SOME STATS 44. 3 F0R 2 CALCULATIONS 45. 3 F0R 2 CALCULATIONS 46. GWP CALCULATIONS 47. GWP CALCULATIONS 48. OPC CALCULATIONS 49. OPC CALCULATIONS 50. AVERAGE PRICE COMPARISON FOR 100 ML IN TABLE – AVERAGE IS TAKEN OF THE UPPER AND LOWER LIMITS OF THE PRICE RANGE. 51. EXPLANATION 52. EXPLANATION 53. SOLUTION 54. SUMMARY 55. DISCLAIMER 56. THANK YOU

1. FEELGOOD

2. OBJECTIVE OF THE CASE
What is the
case about?

3. SALES PROMOTION
STRATEGY
Plan sales promotionstrategy to -
 Increase Sales volume
 Trade-up consumers
 Maintain brand equity

4. WHAT IS
BOOTS?
BUT………….

6. One ofthe best-
known retail names
in the U.K.,
providingHEALTH
& BEAUTY
PRODUCTS

7. BOOTS’
EARLY
DAYS

8. 1849 -Foundedby JohnBoot.
1883 -Established as private company
“Boot and CompanyLimited”
-Company Adopted
its first logo

9. MODERN ERA

10. 1987 -Boots Opticians
1999 -Boots For Men Stores
- Internet Services
Kept Introducing New
Services

11. ASSOCIATED HAIR-CARE
CELEBRITIES AND BRANDS

12. Synonymouswith style,
innovationand success.

13. JohnFrieda’s “Houseof
Experts” fuels the company’s
new
productinitiatives with the
insidetrack on
hot, new celebrityhair
trends.

14. A popularhairstylist to the stars from
the film,television, fashion,and
musicindustries.

15. Creates sexy, contemporary
catwalk looks
to recreate catwalk glamor
at home.

16. Wearable, catwalk-led hairstyles
for peoplewho
want easy-care, trend-setting
hairstyles.

17. Showman of all hairdressers.
His Pioneeringtechniquesand cuts —
the Wedge,the Chop,and the Scrunch
are nowpart of everyday
salon parlance.

18. Known for hairstyle and hair care.

19. COMPETITORS
MAJOR

20. Holds 8.4 % shares of U.K.hair care market

21. - Offers a varietyof products.
- Has globally acquireddiverse
firms.

22. - Worldwidepresence
- Over 500 brands
and 2000 product
in beauty business
sector.

23. Largest supermarket chain in the U.K.
with more than 1,800 stores

24. 400 stores
providingquality
products atthe
same low price
across all of its
U.K.stores.

25. Oneof the largest health and beauty retailers.
Almost 700 stores in the U.K.
Wide assortment ofaround 10,000 products.

26. Consumers......
NOT Brand Loyal......
…..…WHY?

27. 1. Changingbrands
produce
better results.

28. 2. Trends in
buying
behaviour
ledto changing
preferences.

29. 3. TooMany Choices

30. DECISION

31. THREE
PROMOTIONAL
ALTERNATIVES

32. 1.

33. 2. GIFT
WITH
PURCHASE

35. 3.

36. 300% increase in pre-promotional
sales.
60% customers = Promotional
buyers.
Competitive Advantage

37.  Offer can onlybe implemented
whenthe prices for 3
same brandeditems are same.

40.  150% increase in pre-promotional
sales.
 50% customers = Promotional
buyers.
ON-PACK COUPONS

41. Most competitors tend to
use pricediscounts as their
promotionalmethod.
ON-PACK COUPONS

42. COSTS
AND
EXPENSES

43. Average bottle size= 250 ml
Average pre-promotional price = £3.99
Industry averageretail margin onpremium brands = 40%
Manufacturer’s typical margin = 0.10 = 10% (taking averagefor 8 -12 %)
Manufacturing cost perbottle
Cost toretailer = 60 % of selling price =0.6 * 3.99 = £2.39
Cost to company manufacturing the product = 2.39 /(1 + 0.10) = £ 2.17
SOME STATS

44. Forone day,
- Increase in sales = 300%
- Cost of eachbottle = £2.17
- Cost to company= 2.17 *300
=£ 651
- Selling price = 3.99 * 200 = £ 798

45. Profit in oneday = 798 –651
= £147
Profit oneach bottle in oneday
= 147/ 300 = £ 0.49

46. GWP
Foroneday,
- Increase in sales = 170%
- Cost of eachbottle = 2.17 + 0.93 = £3.1
- Cost to company = 3.1 *170 = £527
- Selling price =3.99 * 170 = £678.3

47. GWP
Profit in one day = 678.3- 527
= £ 151.3
Profit oneach bottle in oneday
= 151.3/ 170 = £0.89

48. Forone day,
- Increase in sales = 150%
- Cost of eachbottle = £2.17
- Cost to company= 2.17 *150 = £325.5
- Selling price of eachbottle = 3.99 –0.5
= £3.49
- Selling price = 3.49* 150 = £523.5
OPC

49. Profit in one day =523.5 –325.5
= £198
Profit oneach bottle in one day = 198/150
= £1.32
OPC

50. CATEGORY
Charles
Worthington
John
Frieda
Nicky
Clarke
Umberto
Giannini
Toni
&
Guy
Trevor
Sorbie
Lee
Stafford
Pantene L'Oreal
Shampoo 1.95 1.95 1.6 1.6 1.75 2.0 1.6 0.5
Conditioner 2.5 2.1 1.8 1.8 2.0 2.0 1.6 0.5
Gel 3.30 2.43 3.33 1.86
Mousse 2.75 2.15 2.65 2.3 1.9 1.86 1.6
Hair-spray 2.7 3.9 5.15 3.0 2.75 2.5 1.51
Wax 10.0 7.5 10.0
Serum 10.1 13.5 12.0 20.3 16.85 7.0
Hair Brush 6.65 5.65 5.15
AVERAGE PRICE* COMPARISONTABLE
(PER 100 ml OF PRODUCT)
*Prices are in £

51. Fromthe table, it isevident that
price range of 3 items ofthe same brand
are NOTTHE SAME
– ranging from ~ £2 to ~ £10.
So, even though “3 for 2” offer willcreate a larger
consumer base, it CAN NOT BE APPLIED for every
brand.

52. Among the remaining 2 alternatives -
OPC willbe MAXIMISING the profitbutit
WILL NOT be tradingupthe consumer’s much.
while
GWP isINCREASING the profit andalsoINCREASING the
customer base APPRECIABLY.

53. SOLUTION
So,the second alternative
–
GIFT WITH PURCHASE
shouldbe chosenas the
promotionalstrategy.

54. SUMMARY
OBJECTIVEOF THE CASE
Whatis the
caseabout?
DECISION
SOLUTION
THREE
PROMOTIONAL
ALTERNATIVES
So,the secondalternative–
GIFTWITHPURCHASEshould
be chosenasthe promotional
strategy.

55. DISCLAIMER
Created by Harshit Singh, IIT Madras, during a marketing management
internship by Prof. Sameer Mathur, IIM Lucknow.