HOUSEHOLD PRODUCTS(I) Ltd.

Submitted By:Shradha Devidan

IN COMPANY ANALYSIS
Reason for the New product
Internal Force
Vegetable oil introduction as a soap ingredient citing innovation Introduction in high price sector : Higher profit margins per tonne

External Force
Marginally declining profits in low priced soaps

Extent of Newness
Addition to existing product line

MARKET FOCUS
Focus on Latent Needs of Customer
Vegetarianism Religious Needs

PRODUCT LAUNCH PLAN

Test launch in October 1998 in
Hyderabad (AP) Indore (MP)

Information System based on

Company sales data Bi-Monthly audit of sample retail shops Monthly checks of a sample of households

SALES DATA ANALYSIS

Potential overall decrease in fragrance soap market Increase in Dec -98 subject to the discounts offered.
500 450 400 350 300 250 200 150 100 50 0 Oct-98 Nov-98 Dec-98 Jan-99 Feb-99 Mar-99 Apr-99 May-99 Hyderabad Indore

SALES DATA ANALYSIS

Indore : More Responsive State
SEHRA MARKET SHARE BY VALUE
7 6 5

4
3 2 1 0 Jaimala Sehra

SALES DATA ANALYSIS

No. of rebuy : Hyderabad: 30% From Exhibit 1 and 3: Hyderabad: Penetration of Sehra in IC A and B in Oct 1988- 1.6%. This corresponds to a sale of 400,000 units of Sehra. In April 1999 the additional buyers are 1.3% while the sales are 300,000. Thus this indicates that the sales are mostly due to the new buyers than the old buyers rebuying the product in the latter part of the product trial. Indore: 20%

% of new buyers in each month- Hyd

Sales in ,000 units - Hyderabad

SALES DATA ANALYSIS

The percentage of families buying Sehra has increased while Jaimala has gone down in Hyderabad. However the sales of Sehra has gone down over the trial period. This indicates that either the market size has reduced for the combined sales of Sehra and Jaimala or the no. of units bought per family has reduced for Sehra.

% of families buying Sehra and Jaimala in Hyderabad

Oct Nov Dec Jan Feb Mar Apr May

Sehra

1.58

2.52

3.82

3.42

3.18

4.14

3.83

4.00

Jaimala 7.05

6.40

6.87

5.84

5.51

5.52

4.07

4.28

SALES DATA ANALYSIS

Since in Hyd where the product was tested for being negatively treated the figures show that it has been accepted by an increasing no. of families than in Indore.

Also there has been a drop in market share of both Sehra and Jaimala in Hyderabad. The drop in sales is to be attributed to the reduction in the market for the jasmine fragrance toilet soap category.

Evaluation of SEHRA decisions

Concept development
CONCEPT Jasmine perfumed soap brand made exclusively from vegetable oils Vegetable Oil distinguishing feature

Evaluation of SEHRA decisions

Concept Testing
No consumer testing of the concept before it was converted into actual product. Based on the Marketing Manager and the Product Manager perceptions. Sent to the R&D department directly for transformation into product

Evaluation of SEHRA decisions

Product Development
Consumer research done for the two chosen perfume fragrances R&D was able to develop a vegetable oil soap which tended to wear down at comparatively lower rate Although no STATISTICALLY SIGNIFICANT difference was found between the competition and the main experimental perfume, it was still launched.

Evaluation of SEHRA decisions

Market Testing
Standard Test Marketing followed Test run in two cities
Indore (responsive to the vegetarianism feature added) Hyderabad ( non- responsive to the vegetarianism feature added)

Evaluation of SEHRA decisions

Commercialization
Near-Perfect choice of test centers
Indore : 57% vegetarian : would prefer Vegetable oil compared to animal fats Hyderabad : < 10% vegetarian : not essentially a criteria for selection

Advertising campaign : Legendary bride decorated with jasmine flowers.

Initial, marketed as high price apt advertisement Results showed hit the low price sector majorly bad choice of advertisement
Sehra Gained more from Low Price Hyderabad 28.3 v/s 23.1 Indore : 23.7 v/s 19.4

Product Launch at National Level

Wrong POSITIONING of the product in Test Market
Was pitched as a high priced soap costing at Rs. 7.5 (market average was 8) Sehra Gained more from Low Price
Hyderabad 28.3 v/s 23.1 Indore : 23.7 v/s 19.4

Product Launch at National Level

Decline in market for fragrance soaps Preliminary Results show that perfume of Sehra was considered weaker than that of Jaimala Not many respondents identified the claim of made from pure vegetable oils.

Product Launch at National Level

If launched at the same price with same results- the purpose of launching a soap in premium segment fails. Also since it is gaining more from the low price segment, the test marketing should have also included income groups C & D(income below Rs.5000 per month)

Product Launch at National Level

If price is increased and repositioning done, the entire Campaign will change and again it needs to be test marketed to see results. Also there is a change in the overall trend in the market (exhibit 4) as families buying both Sehra and Jaimala have decreased. It might mean that people no longer relish the Jasmine perfume. Considering all this we do not recommend the product to be launched at the National Level at this stage.