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FACULTY OF BUSINESS AND MANAGEMENT
BBPM 2203
MARKETING MANAGEMENT II
ANALYSE HOW UNILEVER UTILISED MARKETING MIX TO DEVELOP
MARKETING POSITIONING STRATEGIES AT EACH STAGE OF THE
PRODUCT LIFE CYCLE
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Table of Contents Pages
1.0. Introduction
1.1 Unilever (M) Holdings – Company Profile 3 - 4
1.1.1 The Product “Lux Soap” 4 - 5
1.1.2 Product Life Cycle 5
1.1.3 Marketing Mix 6
2.0. Introduction Stage of the Product 6 – 7
3.0. Growth Stage of the Product 7 – 8
4.0. Maturity Stage of the Product 8 - 9
5.0. Decline Stage of the Product 9 -11
6.0. Conclusion 11 -12
7.0 References 13
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1.0 INTRODUCTION ON THE ORGANIZATION AND NATURE OF THE
PRODUCT.
1.1 UNILEVER (M) HOLDINGS – COMPANY PROFILE
In Malaysia, the Unilever journey began 1947 with the opening of the first Lever
Brothers soap and margarine manufacturing plant in Bangsar. The cost to build the
largest factory in the country with machinery costing RM 12 million which could
produce 124 pieces of soap a minute. It creates job opportunities for hundred of
Malaysian. The Unilever brand is trusted name in nutrition, hygiene, and personal
care. It had 400 brands spanning 14 categories of home, personal care and foods
products which no company touches people‟s lives in so many ways.
Unilever aims is to meet the everyday needs of household everywhere, to give the
aspiration of consumers and to respond creatively and competitively with branded
product and services to raise their quality of life. It had invested heavily in proprietary
technology and consumer insight research, Unilever has achieved many
breakthroughs and firsts over the years. In 1994 is a turning point for the company
when it changed its corporate name from Lever Brothers to Unilever (Malaysia)
Holdings Sdn Bhd. Unilever Malaysia has a portfolio of 14 keys brands, which has
personal care products such as Sunsilk, Dove, Lux, Clear, Lifebuoy, Axe, Fair &
lovely, Rexona, homecare product such as Breeze and food product such as
Lipton, Knorr, Lady‟s choice, planta and walls.
Unilever‟s mission is to add Vitality to life. They meet everyday needs for nutrition;
hygiene and personal care with brands that help people feel good, look good and get
more out of life.
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Unilever‟s deep roots in local cultures and markets around the world give them a
strong relationship with customers and are the foundation for their future growth.
They will bring their wealth of knowledge and international expertise to the service
of local consumers – a truly multi-local multinational. Unilever‟s long term success
requires a total commitment to exceptional standards of performance and
productivity, to working together effectively, to a willingness to embrace new ideas
and learn continuously
To succeed also requires, that they believe, the highest standards of corporate
behaviour towards everyone they work with, the communities they touch, and the
environment on which they have an impact. This is their road to sustainable,
profitable growth, creating long-term value for their shareholders, their people, and
their business partners.
1.1.1 THE PRODUCT “LUX SOAP”
Every woman has a passion for beauty as it is the landmark of femininity; the game
only women know how to play. Women all over love to look gorgeous and enjoy the
silent confidence which makes women feel like nothing is impossible.
LUX was first introduced as toilet soap in 1925. Produced by Lever Brothers, it
arrived in the UK in 1928, carrying the promise of France cherished secret to smooth
skin, aspirational yet accessible. Even back in the days of its launch, LUX has always
believed in star strategy claiming to be Hollywood Favourite Beauty Care. The name
Lux means „light‟ in Latin; however the name was chosen for its play on the word
„luxury‟.
LUX simply believes that behaving beautiful is a way of presenting your best face to
the world and maximizing what you‟ve got. It is a conscious choice to be beautiful
and take pleasure in using your beauty. LUX makes it possible for every woman to be
beautiful in many gratifying ways. In the 1950s, LUX arrived in Malaysia bringing
with it a long string of global stars like Aishwarya Rai, Priyanka Chopra, Rachel Weiz
to local LUX stars like Amy Mastura, Sheila Majid, Fauziah Latiff, and Erra Fazira.
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The product offers value for money in the premium segment. It does not compromise
on the quality even if decision pertains to increase in price. As Lux is popularly
known as brand of celebrities, it is also one of the reason that consumer has a
perception in mind that this product is of good quality. And over the years, Lux has
been positioned as a beauty soap of the Stars.
1.1.2 PRODUCT LIFE CYCLE
The Product Life Cycle (PLC) is based upon the biological life cycle. For example,
a seed is planted (introduction); it begins to sprout (growth); it shoots out leaves and
puts down roots as it becomes an adult (maturity); after a long period as an adult the
plant begins to shrink and die out (decline).
In theory it's the same for a product. After a period of development it is introduced or
launched into the market; it gains more and more customers as it grows; eventually
the market stabilizes and the product becomes mature; then after a period of time the
product is overtaken by development and the introduction of superior competitors, it
goes into decline and is eventually withdrawn.
The Product Life Cycle (PLC) Curve
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1.1.3 MARKETING MIX
The marketing mix is probably the most famous marketing term. Its elements are the
basic, tactical components of a marketing plan. In general, they include the following
4P‟s”
1. Product
2. Price
3. Place
4. Promotion
2.0 INTRODUCTION STAGE OF THE PRODUCT
Lux soap was launched in India in 1929. Their very first advertisement featured Leela
Chitnis as its brand ambassador. Lux was then branded in India as “the beauty soap of
film stars”. At that time there was only one competitor of Lux , which was from its
own brand “Lifebuoy”. Lux was sold in over 100 countries as of June 2009.
Product: In the early stages Unilever main concern was to build the confidence of
the product and develop the markets. The Lux was merely a toilet soap in the
beginning and it become a house hold product of every women. Branding and the
quality level are established and intellectual‟s property protection such as patterns
and trademarks are obtained.
Price: The price of the Lux soap was set higher in the beginning as to recover the
initial cost of making the product.
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Place: LUX is selective until consumers show acceptance of the product. It covers the
major cities in India such as Bombay and Calcutta. By the way it helped to recognise
the product. The distributions are by whole seller and retailer.
Promotion: Unilever allocated more budgets on advertising so it can attract more
customers towards the Lux Product. In a way this was to attract the earlier adopters‟
readiest to buy the product.
3.0 GROWTH STAGE OF THE PRODUCT
They have expanded to cities of India. The marketing objectives of the Lux are to
expand their markets to other cities in India and their main objectives are to maximise
the market share. The business is the growth stage in India. The India market is larger
at that point of time. The colours of the product were an important role in the growing
stage. The ambassadors who were appointing at the point of time are the celebrity of
India.
Product: The Company had introduced the same Lux in the growing stages to
maximise the profit. In the growing stage their sales are tremendously good. The
products become popular by women as a toilet product. The women became to like
the product and the quality of product becomes better with few colours and
nice fragrance smell. The colours are pink, white, blue, green and yellow.
Price: The Company had changed price for Lux for some reason to capture the market
share. The price of Lux has been cut so that it will attract more women to use the
product. This change has made the Lux sales to shoot up.
Place: Lux becomes very popular in the other parts of India. It become a worldwide
product and become popular in Argentine, Brazil, Thailand, Singapore, Malaysia and
USA. Lux has established throughout the world and with a great demand.
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Promotion: The budget for advertising Lux increased at this stage so as to retain the
existing customers and to attract the new customers. The celebrity advertisement in
the magazine and TV has further influence and attracted many women to purchase it.
4.0 MATURITY STAGE OF THE PRODUCT
At the maturity stage, sales and profits of Lux has reached the maximum level. There
are also other companies selling soap which entered the market and try to compete
with Lux such as Lifebuoy, Cinthol, Fairglow, Santhoor, Chandrika, Vivel and Fiama
Di Wills. The consumer has now more option to choose the product. It is a
competition among the big giants company to sustain the business and more revenue
needs to pocket out to sustain the business.
Product: At this stage, Uniliver had modified the product by adding some changes to
the product. They made the modification by introducing Lux body wash shampoo,
coloured with nice fragrance smell such as Lux Almond, Lux Orchid, Lux Fruit, Lux
Saffron, Lux International, Lux Chocolate, Lux Aromatic Estracts and Lux Oil and
Honey. With these new launches, Lux had sustained the business and attract more
new and existing customers.
Price: Unilever had set the price higher in the market at this stage and this the reason
they had done this is to solely maximise their profit.
Place: Lux became a well known product throughout the world. It was very easy and
convenient to purchase the product from a town to a small village and in any part of
the world, supermarkets, shops and via mail order.
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Promotion: Lux advertising at this stage somehow has been decreased to some extent
due to the brand awareness in the customers‟ mind. The Lux Ambassadors Aishwarya
Rai, Kareena Kapoor and Shah Rukh Khan promoted the product via TV
advertisements, radio, magazines and also through the internet. This is to encourage
every fan of them around the world to use Lux products. It became a unisex product
of every home in India and around the world including Malaysia. There were also
promotions when you buy three and you would get one free. The content and nice
fragrance smell has attracted a lot of new customer. The children also have Lux
product to use for them. Initially it just started as a toilet soap, and then it was called
the Celebrity soap with a gross annum one billion Euro.
5.0 DECLINE STAGE OF THE PRODUCT
At the decline stage, basically as the sales decline, a company normally has several
options in dealing with this kind of situation. Firstly, they may maintain the product,
possibly rejuvenating it by adding new features and finding new users. Secondly,
harvest the product by reducing its costs and continue to offer it to any loyal niche
segment. Finally, they may choose to discontinue with the product, liquidating
remaining inventory or selling it to another company that is willing to continue the
product. Even though Unilever had several campaigns for the sales promotion of Lux,
the reasons for it to decline was due to the factors as below:-
Slowdown: Due to bad economic conditions and instability in India and other
countries year 2008 to 2009, the sales was very highly affected as the consumers
started to look at alternatives product which is rather cheaper than Lux.
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Currency Fluctuations: There are over 100 countries of Unilever products
worldwide and as a matter of fact it exposed to unfavourable currency fluctuations.
For example in year 2004, a 5.9% decline in turnover was primarily due to a 4%
approval in the average Euro exchange rate.
Competition: Lux has been facing huge challenges with company like Lifebuoy and
from other companies like:-
Godrej Consumer Products: India‟s second largest soap maker with 9.2% market
share with leading brands such as CINTHOL, FAIRGLOW and NIKHAR. And the
most successful innovations which have created history were the India‟s first fairness
soap “Fairglow brand”.
ITC: This Company entered the sector last year and made a strong movement in a
short period by growing to 1.75% in just five months and with the brands like Fiama
Di Wills, Vivel and Superia.
Wipro: The occurrence of Wipro in the toilet soap industry can be seen through their
brands such as CHANDRIKA and SANTHOOR. It is a key market player in toilet
soap in the southern market of India.
Product: Although at this declining stage, the market was not so active in this product
but there were people still using Lux products. The product was classified into non
durable and tangible. Lux trade character or logo is present highly in the package and
female models were displayed graphically. In terms of packaging there were packages
in different sizes, different colours and variants such as Lux Orchid and Pearl Glow.
Mini Lux of 45gram weight was also launched. Lux and other soaps fall into the
category of convenience good.
Price: The prices were competitive and were maintained neither high nor low at this
stage for continued products as there are people who still using the product.
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Place: Unilever was quite particular of the distribution channels that they have been
utilizing all this while and became very selective at this stage. Channels that are no
longer lucrative were eventually dropped. The product was distributed to suppliers
and associates, stockists, and direct coverage in over one million retail outlet.
Promotion: Lux gold Star offer 22 carat gold coin in the soap for the first 10 caller.
For the Lux star bano, Aish karo contest, all one need to do was to buy a promotional
pack fo lux soap. The pack comes with a special scratch card whereby 50 lucky
winners will get to meet Aishwarya Rai. There was also a beauty contest created to
attract more people to use Lux.
6.0 CONCLUSION
Lux was always changing with times. Whether in terms of products or in terms of
promotions, the brand kept the consumers excited. Lux was initially a premium brand.
It was being projected as an aspirational brand and the enforcements by stars further
reinforced the positioning.
We can conclude that there are many competitors today that sell toilet soap or beauty
soap in the market and yet they still survive though there is a bit of hiccups here and
there. As for Unilever, it has come a long way ahead and Lux is still strongly
recognised by anyone in the world and there are people who still uses the soap and
now that there are new innovations of Lux such as the shower cream of different
fragrances. Despite all these, there are areas of concern which is Lux has been mainly
positioned as beauty soap targeted towards women but lack of unisex appeal. Besides
actor like Shah Rukh Khan being the Lux Ambassador for the male section, Lux
should bring new innovations categorized for men with fragrances that suited the men
personality. Some variation like the sunscreen, international variant did not do well in
the market and not much popular in rural areas and perhaps this products can be
replaced or modified to outfit the men instead.
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As the soap industry is vast growing by 10% in India, the beauty segments
compounded annual growth rate (CAGR) is very high. Liquid body was currently in
maturity stage and the suggestion is that Lux should come out with more variant in
this segment. And due to large market share, Lux has a strong hold over the market.
The beauty soap industry of India consists of a few producers in the industry. For this
product, the demand is very much vulnerable in terms of pricing. In India, Lux is at a
price that is affordable to most of the people in the country. It is an uprising product
as the larger portion of the population both male and female, are now getting more
beauty conscious.
As a multinational company, Unilever with aggressive promotional activities has been
able to penetrate the market. With six different fragrances, three different sizes,
international standard and high quality design, as a product Lux has been highly
successful over the years. Besides that, its distribution process is highly efficient. Not
forgetting the fact that its promotional activities, like the beauty contest has been a
runaway success in attracting a huge number of customers. Overall, with its marketing
activities, Lux has been a successful brand.
7.0 REFERENCES
Lux Celebrating Beauty. (2007) http://marketingpractice.blogspot.com/2007/01/lux- celebrating-beauty.html [online] Retrieved 05 October 2011. Company news. (2011) http://www.hul.co.in/ [online] Retrieved on 11 October 2011. Lux Presentation. (2008) http://www.slideshare.net/hit20032003/lux-presentation- presentation [online] Retrieved on 11 October 2011. Another Soap Successs Story for Unilever. (2011) http://adage.com/article/special-report- cannes-07/soap-success-story-unilever/116289/ [online] Retrieved on 14 October 2011.
