MARKETING RESEARCH REPORT ON OLAYTO FIND HOW THE COMPANY CAN INCREASE THE MARKET SHARE OF OLAY NATURAL WHITE WHICH TARGET CUSTOMERS OF AGE GROUP 14-30 YEARS. SUBMITTED TO: SUBMITTED BY: Prof. Subrat Kumar GROUP- 120/12/2011 PGDM (IBM) Birla Institute of Management Technology Plot No. 5, knowledge park-II Greater Noida, UP-201306
Table of contents
1. Background study
2. Secondary Data
3. Literature review
4. Research Methodology
5. Management Decision Problem
6. Management Research problem
7. Methodology or approach(research Questions and hypothesis)
8. Questionnaire design
9. Company profile
10. Analysis and findings
The anti-aging market is one of the largest in the world. The majority of these people want to find a way to fight aging, which is why there is such a high demand for products which hide or fight the signs of aging. It is a great thing that there are so many anti-aging products available.
There have been many options for controlling on wrinkles like Plastic surgery, Botox etc. but plastic surgery could not get success because of its complexity and high cost and remained in the reach of film stars and high profile people. Same the case is with Botox but it was not complex and it is relatively economical. But Botox has its own side effects. Botox addresses only one aspect of facial rejuvenation motion wrinkles. The FDA has only approved Botox for use on an extremely limited area (less than 5% of our entire face). Regular injections risk skin and nerve damage and actually thin the skin exacerbating some skin problems. The effect of Botox injections almost completely disappear within 3 to 6 months. After which we need to again and again set up appointments with a doctor, get a new set of injections and spend more money (about $700)...every 3 to 6 months.
Anti-aging creams are now being used by people under 30 for wrinkle prevention because of growing consumer awareness of anti-aging solutions. From time-release, to heat activation, to nanosphere bursts, to film technology, specialty actives and delivery systems are helping drive the fast-growing cosmeceutical market, at US$2.5 billion in the U.S. alone. Anti-aging skin care products are expected to grow 11% annually by 2008. The slow release into the skin sustains the benefits of the active, meaning better, longer-lasting products. With skin care accounting for 59% of the cosmeceuticals market, new actives for skin care have plenty of room to grow.
Consumers are returning to the notion that natural is healthier, and the natural, holistic approach to personal care has regenerated itself in the form of organic preservatives. Despite a shorter shelf life, they provide aroma therapeutic and anti-oxidant wellness for the user, while preserving the integrity of the product. Organic personal care and cosmetics are expected to grow into a US$5.8 billion market by 2008. In Latin America, in spite of the region's low disposable income, the past two years have seen skin care march ahead of hair care as the fastest growing product sector. Mainly due to new technologically advanced products, anti-aging and anti-cellulite sales increased by 22% and 25%. This is also due to the fact that people under 30, in the hopes of preventing wrinkles and maintaining a youthful look, are buying more anti-aging products. Consumers have also become increasingly well informed about the advances in the skin care sector.
The report from Fredonia Group entitled Anti-Aging Products sets the 2004 market for health maintenance products at $18 billion in 2004, compared with just $2 billion for appearance products. The overall anti-aging market was set to grow by 8.7 per cent a year over the next five years, reaching a total value of $30.7 billion by 2009, compared to an estimated value of $20.2 billion in 2004. But although health maintenance products are expected to increase by 13.6 percent, appearance products are slated for 17.6 percent growth, with the highest increase, of 19.8 percent, in the skin care subcategory.
Anti-ageing products tend to focus on skin care, where anti-wrinkle cosmetics are now taking the market by storm. Euromonitor International estimated that the total market for skincare products is valued at $38.3 billion globally, a figure that is second only to the hair care sector. However, breaking this down for products specific to the anti-ageing market, the figures are even more dramatic. For products that target specific age-related conditions, the global market was estimated at $6.9 billion in 2003, indicating a growth rate of 11.4 per cent. India's personal care market is becoming more sophisticated as the country Westernizes according to a Kline and company report published earlier this year. According to Indian census report 113,742,306 females are in the age group of 34-59 years. So huge potential is lying in.
Watching this opportunity International direct seller Mary Kay Inc. has set up its Indian subsidiary, Mary Kay Cosmetics Pvt. Ltd., in Gurgaon, New Delhi. The company plans to invest approximately $20 million in the country over five years. Targeting the high growth Indian beauty market, Mary Kay expects 50% of its business to be generated by its skin care range and the rest by its color cosmetics and body care offerings. "We anticipate generating the same success in India that we have seen in other Asia-Pacific markets," said K.K. Chua, president, Mary Kay Asia-Pacific. Products have been priced to attract both mass to mid-range consumers. "We want to make this brand available to all working women looking for good skin and makeup. We have kept the pricing affordable so that the maximum number of women can buy them," said Hina Nagarajan, country manager, Mary Kay India.
The market has matured, and Indian women are ready to spend on looking good and feeling good." A survey at the Dubai and Heathrow airport retail outlets showed that Clinique was the most purchased skin care product among returning Indians. Speaking on While the market for direct selling beauty companies hasn't been very strong in the country, despite Oriflammes and Avon's steady business, Mary Kay is confident to bring a paradigm shift with its new selling strategy and approach. The company plans to create a pull in the market rather than push, and its consultants are being trained to act as beauty advisors rather than just salespersons. In fact, the company created a much focused product portfolio that answered beauty needs specific to Indian women, launching its Botanical Customized Skin Care Collection in India.
Launched in 1957 in South Africa, now Olay is present in over 55 countries globally. In India, the brand has been distributed and has been available in the grey market all this while. Olay was formulated as a fluid moisturizer by South African chemist-entrepreneur Graham Wulff and launched officially in 1957. Once popular as 'Oil of Olay, the pink lotion' it is now known as just 'Olay' and enjoys a high recall value in India.
The Indian skincare market grew by 9.4% in 2003 to reach a value of $94 million. The compound annual growth rate of the market in the period 1999-2003 was 10.8%. Annual growth has fallen steadily from its 2000 high of 12.0% to a low of 9.4% in 2003.
The anti-ageing cream, Olay Total Effects, has been launched only in six metros in the first phase in India and has been endorsed by former Miss Universe and actor Sushmita Sen. "Initially 'it is made available at around 2,000 outlets including hyper retail stores, chemists, beauty advisors and the existing distributors in Hyderabad, Delhi, Mumbai, Kolkata, Chennai, and Bangalore,". After the overwhelming response by discerning Indian women to the Olay Total Effects, P&G has now initialed a unique campaign - The Olay Total Effects Challenge*. This is an opportunity to enable many more women to experience the delight of one product that takes care of several ageing skin needs.
Olay Total Effects' Vita Niacin Technology helps Indian women fight the seven signs of ageing It is a breakthrough anti-ageing moisturizer containing the patented Vitaniacin formulation.
P&G Home Products Limited is one of India's fastest growing Fast Moving Consumer Goods Companies that has in its portfolio P&G's global brands such as Ariel and Tide in the Fabric Care segment, and in the Hair Care segment: Head & Shoulders - world's largest selling anti-dandruff shampoo; Pantene - world's No. 1 beauty shampoo; and Rejoice - Asia's No. 1 shampoo. P&G Home Products Limited is a 100% subsidiary of The Procter & Gamble Company, USA that in India, has carved a reputation for delivering superior quality, value-added products to meet the needs of consumers.
The Indian skincare market grew by 8.5% in 2003 to reach a volume of 69 million units. The compound annual growth rate of the market volume in the period 1999-2003 was 8.8%.The strongest growth was in 2000 when the market grew by 9.1%.
The leading revenue source for the Indian skincare market in 2003 was the facial care sector, which accounted for just over 72% of the market's value. In value terms this sector was worth $67.9 million in 2003, an increase of 49% since 1999. Despite its leading position, the facial care sector was outperformed by body care, which grew by 62% between 1999-2003. In additi