Student: Viet Truong

Class: MK618
CASE ANALYSIS
DRYPERS CORPORATION
National Television Advertising Campaign
According to the case, although Drypers Corporation is the worlds sixth largest
producer of disposable baby diapers and third largest marketer of a disposable diaper in
United State, the fact is Drypers has never conducted Television advertising in its 10year history. Moreover, the budget for advertising and promotion was a challenge to
Dryper when they would have to add more $10-million expenditure represented a 33
percent increase in its budget. From the first glance, it could be a considerable number
to Dryper, but this amount was low as compared to its main competitors are KimberlyClark and Procter & Gamble when they spent approximately $60-million just for media
advertising in 1997. Hence, conducting National Television Advertising Campaign could
be a wise move to improve brand recognition among consumer but whether $10-million
is the right amount for the company to spend? To answer this question, a deeper
analysis will be presented in this essay.
First of all, if Drypers did not spend $10 million on television advertising, they
would void the 33% increase in an additional cost for advertising and promotion, but
they would stand in front of the risk of lower brand awareness as well as remain or loss
market share which leading to sale decrease. We can predict this risk when we take a

look at the Exhibit 2 when Dryperss main competitors are Kimberly-Clark and P&G had
increased trend in Combined Dollar market share for disposable diapers and training
pants in 1994-1997 periods.
If Dryper spends $10 million for the campaign, it could increase the brand
recognition and awareness as well as penetration of retail grocery store. But on the
other hand, Dryper could have a threat from their competitor (Kimberly and P&G) when
they often aggressively conduct offer the diaper promotional spending and pricing. This
threat clearly shows in the number of total Media Television expense that they spent:
$75,6 and $69,6 million. These numbers were two times more than total expense of
Dryper for advertising.
In the past, we can see that Drypers often relies on the advertising vehicle that
did not effectively increase their brand awareness. They relied on the print advertising in
the parent-oriented magazine and regularly places coupons in daily newspapers food
section. Besides, they also did large volumes of direct mail, in-store promotions and
sampling. But the sampler was 8,000 to 10,000 unit annually; it is not a considerable
number in comparison with the number of their customer target that we can see in the
Exhibit 1 when just the number of infants in the United States was 9.7 million in 1997.
When we take a look at the Company Sales and Profit history of Dryper, we can
see the increasing trend in its total net sale, from $163.9 million to $287.0 million in the
1995-1997 periods. It could be the impressive number, but in fact, when we see the
income statement (Exhibit 4) their net income was lost in 1995 and have a significant
increase in 1996. Moreover, with their increase trend in this period, we can estimate that

in 1998, the total net sale of Drypers would be more than $350 million or maybe more if
they conduct the TV advertising campaign. From this number, we can see that $10
million expense for Television campaign would be a small amount, but they would get
many benefits from this investment.
The core benefit of Television campaign was not only the increased sale for
Drypers in the short-term, but they were also the brand awareness and recognition that
Drypers could improve among their customer in the long-term. The second benefit is
very crucial when they were facing with many aggressive competitors that always ready
to discredit Dryper anytime
In conclusion, Dryper corporation would choose the option that spends $10
million for Television Advertising. It not only because of direct benefit that it would give
but it also the opportunity for the brand, when they are clearly the company that has
differentiated products from its competitor and this feature, could impress the customer
from the first glance.