Boots is a major UK retailer looking to promote hair care sales. Three promotional strategies are considered: buy 3 products for the price of 2 ("3 for 2"), receive 50p off each product, or get a free gift with purchase. Analysis shows the "3 for 2" strategy would increase sales the most at 300% and attract 60% of customers, generating the highest estimated profits of £7533 for December. While competitors could copy the promotion, Boots' technology provides an advantage. The analysis recommends implementing "3 for 2" first, followed by the 50p off coupon, then the gift with purchase strategy.
Boots hair care sales promotion presentationRahul Ladiya
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.
Boots hair care sales promotion presentationRahul Ladiya
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.
• Plan a sales promotion strategy for a line of professional hair-care products at Boots.
• primary objective was to drive sales volumes and trade-up consumers from lower-value brands, while retaining or building brand equity.
• collaboration with UK’s top celebrity hairdressers → an important component of their strategy
IVEY Business School Case Study- Boots:Hair-care Sales promotionShoham Teberiwal
This presentation was made during my internship under Prof. Sameer Mathur at Indian Institute of Management, Lucknow.
It is based on review of case study presented by IVEY School of Business concerning the hair-care sales promotion.
*Some of the materials may involve copyright issues.
MILAGRO DE INVENTO, MULTIPLICA LA ELECTRICIDAD QUE GASTA EN TRANSFORMARLA.
La M-EHX22 con la fuerza que inyectan las bombas a sus volúmenes, por cada 3,025 MW que consume en el proceso de transformaciones de fuerzas de las carreras de empuje por la longitud de sus zonas/cámaras de presión cíclicas periódicas, entrega libres, sin gases de efecto invernadero, 39 MW y ocupa sólo 100 m2, permite instalarse en las urbanizaciones de las Ciudades.
Su sistema hidráulico <en> crea energía a 310 k/pcm2, posibilita una potencia de empuje a su rotor de millones de kgs para transformar en energía eléctrica equivalente a centrales hidráulicas por salto de agua de represa, se instalan <tantas> para cubrir la necesidad de la demanda de los cinco Continentes.
• Plan a sales promotion strategy for a line of professional hair-care products at Boots.
• primary objective was to drive sales volumes and trade-up consumers from lower-value brands, while retaining or building brand equity.
• collaboration with UK’s top celebrity hairdressers → an important component of their strategy
IVEY Business School Case Study- Boots:Hair-care Sales promotionShoham Teberiwal
This presentation was made during my internship under Prof. Sameer Mathur at Indian Institute of Management, Lucknow.
It is based on review of case study presented by IVEY School of Business concerning the hair-care sales promotion.
*Some of the materials may involve copyright issues.
MILAGRO DE INVENTO, MULTIPLICA LA ELECTRICIDAD QUE GASTA EN TRANSFORMARLA.
La M-EHX22 con la fuerza que inyectan las bombas a sus volúmenes, por cada 3,025 MW que consume en el proceso de transformaciones de fuerzas de las carreras de empuje por la longitud de sus zonas/cámaras de presión cíclicas periódicas, entrega libres, sin gases de efecto invernadero, 39 MW y ocupa sólo 100 m2, permite instalarse en las urbanizaciones de las Ciudades.
Su sistema hidráulico <en> crea energía a 310 k/pcm2, posibilita una potencia de empuje a su rotor de millones de kgs para transformar en energía eléctrica equivalente a centrales hidráulicas por salto de agua de represa, se instalan <tantas> para cubrir la necesidad de la demanda de los cinco Continentes.
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This case study is about Boots a premium wellness company functioning in 130 countries and the problem is to identify the best promotional strategy for its hair care products.
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2. Situation
Boots, A best known and respected retailer and
provider of health and beauty product in UK
primary objective was to drive sales volumes and
trade-up consumers from lower-value brands,
while retaining or building brand equity
3. Competitors
Mass market brands-P&G, ALBERTO-CULVER
(UNITED KINGDOM), L’ORÉAL
Hair care product retailer- Tesco, Sainsbury’s and
Morrison’s
Major hair care competitor- Superdrug
4. Consumers
Not very brand loyal
• Brands produced better results than continually using a single
brand
• Trends in buying behaviour led to changing preferences
• It was difficult for consumers to identify meaningful differences
between the various brands available in any given store
7. To redeem a coupon for getting 50p off on any product purchased
consumers to buy two hair-care items
at regular price and receive one free
will be given a product sample for
free along with a regular purchase.
8. Possible Criteria
• Driving Sales volumes in the current season
• Trade up Current consumers from low-value brands
• Maintaining Profits from the current promotions
• Secure market leadership in Hair care Retail segment
ultimately.
9. Hypothesis
3 for 2 would be the best option for the promotional
strategy selection
Offer
type
Estimated Percentage
increase in sales per day
Approximate
Percentage of sales
to customers
3 for 2 300 60
Gift With
Purchase
(GWP)
170 40
50p off
per
product.
150 50
10. pe of
oduct
)
Offer
type
(B)
Average
pre-
promoti
onal
price
(C)
Retailer
Margin
in per
cent
(D)
Average
Cost
incurre
d per
product
(E)
Average
cost
incurre
d to
boots
for the
items in
offer.
(F)
Price
Paid
after
the
promoti
on
Profit per
product
(H)=
{(G)-(F)}
mium 3 for 2 3.99 40 2.39 7.17
(per 3)
7.98
(per 2)
+0.81
ss
rket
3 for 2 2.00 25 1.50 4.50
(per 3)
4.00
(per 2)
- 0.5
mium GWP 3.99 40 2.39 2.39+0.9
+ 0.03
=3.32
3.99 +0.67
ss
rket
GWP 2.00 25 1.50 1.5+0.9+
0.03
=2.43
2.00 -0.43
mium 50p off 3.99 40 2.39 2.39 3.99-0.50
= 3.49
+1.10
ss 50p off 2.00 25 1.50 1.50 2.0- +0.00
11. Proof & Actions
The profit per product is 0.81£ in 3 for 2 promotion strategy.
Per day profit= 300*0.81£ =243£
For total December= 243*31days =7533£ (considering
consumers will go for only premium products due to offer
season.)
Even if we consider there would be atleast one mass market
product out of 3, the 300% percent increase in sales and
60% new consumer attraction would offset this.
Moreover, the firm has an advantage of pioneering technology
which keeps the competitors from copying the strategy and this
proves to be a huge advantage for Boots.
12. • The profit per product is 1.10 £ in 50p coupon off promotion
strategy.
•Per day profit= 150*1.1£ =165£
•For total December= 165*31days =5115£ (considering consumers will
go for only premium products due to offer season.)
•In this case even if more number the consumers go for mass market
products(0p loss per product), there is no chance of the retailer going
into loss but it may result in decrease of profit.
•Although it may bring in 50% new customers, This strategy can be
easily copied by competitors
13. • The profit per product is 0.67£ in Gift with purchase promotion
strategy
•Per day profit= 170*0.67£ =113.9£
•For total December= 113.9*31days =3531£ (considering consumers
will go for only premium products due to offer season.)
•In this case if more number the consumers go for mass market
products(43p loss per product), it can push the firm into losses as
there is no rule regarding least expensive product as in case of 3 for
2 option.
•Although it may bring in 40% new customers, This strategy can be
easily copied by competitors.
14. Action Plan
After calculating estimated profits and analyzing market share
potential, The preference order of the implementing the 3 strategies
would be:
1) 3 for 2
2) 50p off coupon
3) Gift with purchase