Prof. Klinger
Business Administration
Tuesday and Thursday 11:30-12:50
This homework is very well researched, structured, and written. Notice the data
on the target market, market share, distribution channels, and the clearly
defined market segments. Also notice how the marketing mix is defined for
each segment and for each element of the marketing mix, the paper says how
that element addresses that particular segment. The paper does a good job of
referencing and citing sources.
Homework #5
May 1st, 2014
Names
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Business Administration
1. Identify the target market
The hair care market had no significantly changes between 2006 and 2011.
Sales were $6.5 billion in 2011 just $10 million more than in 2006 (Mintel International
Group Ltd.). Below is a table of the sales and US share of the market.
Year
Growth of Shampoo
USA percentage of
USA share of Global
& Conditioner
Market
Market (B=billion)
Market
1997
$41.137 B
37.70%
$5.33 B
1998
$14.759 B
38.42%
$5.67 B
1999
$15.461 B
38.92%
$6.02 B
2000
$16.256 B
39.17%
$6.3 B
2001
$16.795 B
39.42%
$6.62 B
2002
$17.509 B
39.68%
$6.95 B
(Mintel International Group Ltd.)
Suave is a product made by Unilever. From 2007-2012, Unilever increased its
share of the U.S. hair care market from 9% to 16% (Report Linker). Shampoo is the
leading segment in the global hair care products industry. Hair care products in the
United States are dominated by three major companies including; L’Oréal, Procter &
Gamble and Unilever.
Suave’s motto is “looking great doesn’t have to cost a fortune.” Their customers
are savvy shoppers. Their target market is people who are value minded. Suave’s
products are considered high quality but with a low price. Their targeted demographic
is women who are heavy shampoo users between the age of 18-45 in the middle
income bracket (Suave). Suave targets all age groups; from babies to senior citizens.
They also sell their products in three continents including North America, Asia and
Europe. Suave’s products are suitable for babies, children and adults. Their target
market consists of males and females who have a family. They typically have a low to
moderate income and are homeowners (Unilever). The characteristics of Suave
customers include mothers, large families with young children, price sensitive, blue
collar and love in rural and suburban areas. Suave also targets all races. Suave’s
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Business Administration
products are ranked #1 with Hispanics and #3 for African Americans. Suave’s
customers are also have busy lifestyles and want to look good without spending a lot
of money. Due to their customer’s moderate income and busy lives, most of their
products are sold in convenience stores like dollar stores, Wal-Mart and grocery
stores. Suave’s products are used in 16 million homes; which is more than 90% of
shampoos. In addition, Suave has the longest line of shampoos. Their strategy is to
have many choices so people stay within the same brand.
Below is a graph of shampoo sales in different channels in 2011/2012. The
most productive sales channel was food outlets. Suave mainly targets customers who
buy at drug and other outlets rather than food. An opportunity for them to expand can
be seen in the food outlets.
(The Statistics Portal)
2. Identify the market research you would do to understand the target market.
There are many market research techniques that can be used in order to better
understand a company’s target market. Surveys are the most common idea, but are
boring and not creative. They are however straightforward and concise. Another
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Business Administration
option to learn about the target market is through focus groups. Focus groups can be
used in order to better understand the customer’s feelings about a certain product.
The company can learn how people think about the product, what they would like to
see in order to develop new products to fit consumer needs. From this information
companies can learn how to improve their product or create another one.
Another idea is giving Suave users a discount card and they have to swipe it
every time they buy a Suave product and they can build points in order to earn
savings. This will allow the company to know where their customers are buying their
products. This is a way to track the customers and learn more about them. Grocery
stores and other large companies keep track of their customers through loyalty cards.
By data mining and working with these stores, Suave could learn more about their
customers. This technique will allow Suave to know where they should place more of
their products.
Social media is a huge new industry. Social network sites are a good place to
learn about your customers. Offering rewards for liking Suave on Facebook or
following them on Twitter would allow Suave to learn more about the customer’s
habits. Knowing where customers spend their time is crucial. 16% to 25% of Internet
users spend their online time on social network sites. Additionally, customers spend 1
out of every 6 online minutes on social networks (Social Media Examiner). Social
networks and blogs are a major component of this time. Suave could create a blog site
where customers can interact and share ideas. Using this information, Suave could
better meet the needs of their customers. Facebook is also a good way to find out
about the target market. If a Facebook page has over thirty likes, the company has
access to Facebook Insight. Insights allows the company to see who is interacting on
the page, demographics and media consumption. Facebook is a great way to monitor
customers. Google Analytics also offers information to companies about who is visiting
their websites and what they also search when googling their brand.
Based on the information collected from these market research techniques,
companies can develop new marketing and business plans to target their customers.
The research is intended to discover what consumers like about a product, what they
dislike and what they would like to see. If researchers find that there is a segment of
the market that is interested in Suave products, but there are no shampoo products
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that meet their needs, they can develop a new product.
3. Identify the different segments in the market. Be specific about the
characteristics of the segments
1. Segment #1 Marketing Mix: Males with ages ranging from 18-40, with
incomes between $30k and $90k, who are care about their hair and clean their
hair frequently.
a. Product: Suave’s 2-in-1 Anti-Dandruff Classic Clean Shampoo &
Conditioner helps control scalp itching and flaking associated with
dandruff. It is designed for men’s hair and is salon proven to clean as
well as American Crew® Anti-Dandruff Shampoo. This product
addresses the segment because dandruff most commonly affects males
during this age range. Other Suave products that are specific towards
males include 2-in-1 Classic Clean, 2-in-1 Alpine Fresh, Daily Clean and
Deep Clean Peppermint. Males prefer 2-in-1 products because they are
more convenient and you get more for the price of one.
b. Pricing Strategy: The prices of these types of shampoo are between $36, so all classes of people are able to buy. Suave used this price
because this product is stable in the market. Young males and older
males all have the ability to buy this product.
c. Promotional Strategy: Suave can do some television commercials on
channels that appeal to males from 18-40. These include, ESPN, Spike
and USA. These channels would appeal to the market because the
audience of these channels is mostly male dominated. Magazines where
ads can be placed include Men’s Health, GQ and ESPN. Advertising
during a high viewing time on ESPN for a sports game would be a great
opportunity to reach a wide range of people.
d. Distribution Strategy: The places to distribute these shampoos would be
in stores and online like amazon.com, SOAP, Target, Wal-Mart,
Walgreens and CVS. Once we do more research, we could target
certain locations with more male dominated population and place more
bottles in those locations.
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Business Administration
2. Segment #2 Marketing Mix: Parents with incomes between $40k and $110k
with kids between the ages of 3-14 and who want their kids’ hair in nice
condition and can leave skin soft.
a. Product: Tear-free Suave Kids® Watermelon 3-in-1 formula combines
shampoo, conditioner and body wash to help clean and detangle
children’s hair and leaves their skin soft and smooth. There are many
other scented 3-in-1 and 2-in-1 kids hair products.
b. Pricing Strategy: The price for these shampoos is about $4, which every
class of people is able to buy. The price is low but still has good quality.
It has a specific cover which most kids like that may affect on the price.
The designs and characters on the bottle appeal to the kids, but the
superb formulas are marketed to the parents. The 3-in-1 formula makes
the product more stable in the market. The 3-in-1 formulas are also good
to teach children how to take a shower.
c. Promotional Strategy: This product is created for kids, so it can marketed
on Cartoon Network, Disney Channel and Nickelodeon. These channels
will attract the attention of the kids. However, to get the parent’s
attention, since they are the ones who will buy the product,
advertisements can be placed in magazines like Good Housekeeping,
Parenting, Reader’s Digest and Women’s Health.
d. Distribution Strategy: This product is sold in many stores in the US and
online like amazon.com, SOAP, Target, Wal-Mart, Walgreens and CVS.
The children’s shampoos should be placed in stores near schools and
day cares. Families with children are a major part of Suave’s target
market.
3. Segment #3 Marketing Mix: Women and men ranging from 16 and up with an
income ranging from $25,000-$90,000 who color their hair and want to protect
and extend the color.
a. Product: Hair Color Protection shampoo and conditioner is for people
who color their hair and want to lock in the color and prevent it from
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Business Administration
fading. This formula helps moisturize hair and keeps it healthy and from
drying out.
b. Pricing Strategy: The pricing for this product is $4.00 which offers a great
value without sacrificing quality. This product and price are optimal for
individuals who want to color their hair.
c. Promotional Strategy: This product is created for women who color their
hair at any age. This product can be marketed through magazines at hair
salons and commercials for television shows like MTV where the age is
generally 16-35 and actively engage in coloring their hair and all the
newest fashions. Comedy Central, ABC Family, TBS, ABC and CBS are
all channels where women watch television. Specific shows to place
commercial advertisements include, The Bachelor, Scandal, Grey’s
Anatomy, Dancing with the Stars and Revenge. These shows are perfect
opportunities to reach this market segment.
d. Distribution Strategy: This product is sold at Wal-Mart, Drug stores,
Harmon, Shop Rite, Beauty Salons, and hair color supply stores. To
reach people who dye their hair, these products should be sold in
salons. Deals with salons can be made in order for Suave products to be
sold at salon locations. The income range and demographic of people
correlates with Suave’s target market.
4. Segment #4 Marketing Mix: Any person who has dry hair and uses this
product to help keep their hair moisturized and soft. The market includes men
and women with income ranging from $15,000-$80,000 who want a great
product at a great value.
a. Product: Suave Professionals Sleek shampoo for dry or frizzy hair is
perfect for people who experience dry hair or humidity related frizziness.
Suave also has shampoos with Keratin and Moroccan oils to aid with
frizzy hair.
b. Pricing Strategy: These products are in the $3.00 range. It is a cheap
and easy way to keep your hair healthy and moisturized. The price is
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Business Administration
perfect for people with frizzy hair because they may need to buy this
product often in order to manage their hair.
c. Promotional Strategy: This product is created for people who have
problems with their hair being dry or falling out, as well as when humidity
picks up it prevents frizziness. This product is made for people with dry
hair so it is marketed on commercials with soap operas, hair coloring
products, as well as in stores when they are on sale. Channels for
commercials include ABC, TLC, CBS, FOX and Lifetime. This product
can be marketed in similar location as the hair dye shampoos because
they aim to market the same women.
d. Distribution Strategy: You can find this product online at Amazon or
Target, Wal-Mart, grocery stores and Walgreens. This product would be
optimal for salon locations. Salons are where women go when they are
having issues with their hair.
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Prof. Klinger
Business Administration
Works Cited
Mershon, Phil. “5 Social Media Tips for Finding and Engaging Your Target Audience.”
Social Media Examiner. N.p., 28 Mar. 2012. Web. 23 Apr. 2014.
<http://www.socialmediaexaminer.com/5-social-media-tips-for-finding-andengaging-your-target-audience-new-research/>.
Mintel International Group Ltd. “Shampoo, Conditioners and Styling Products - US April 2012.” Market Research. N.p., 18 Apr. 2012. Web. 23 Apr. 2014.
<http://www.marketresearch.com/Mintel-International-Group-Ltdv614/Shampoo-Conditioners-Styling-Products-April-7086352/>.
“Suave Company Information.” Suave. N.p., n.d. Web. 23 Apr. 2014. <”Suave®.”
Suave Product Information. Unilever USA, n.d. Web. 23 Apr. 2014. .>.
“Suave®.” Suave Product Information. Unilever USA, n.d. Web. 23 Apr. 2014.
<http://www.unileverusa.com/brands-in-action/detail/Suave-/298224/>.
“U.S. Shampoo Sales via Different Sales Channels 2011/2012.” Statista The Statistics
Portal. N.p., n.d. Web. 23 Apr. 2014.
<http://www.statista.com/statistics/193102/us-shampoo-sales-via-differentsales-channels-in-2010-and-2011/>.
“Suave®.” Suave Product Description. Suave. N.p. Web. 25 Apr. 2014.
<http://www.suave.com/product/detail/671090/wacky-melon>.