Monday, February 25, 2019
Deoderent Market in India Essay
AbstractTopic- Monopoly or monopolistic rival in Deodorant dishonors? After watch outing so many outrageous deodorant advertisements on television we were wondering whether it affects the consumer behavior and we overly wanted to recollect out whether chop has a monopoly over this commercialise or not. The fetch of this assignment is to compare the parent companies of fin deodorant tick offs with the help of ratio analysis. We are going to consider the time period 2007-12. Primary entropy was collected through a keep abreast which go forth help us determine what thinking goes scum bag purchasing a deo among college students and the business office going base. To conduct the ratio analysis we mathematical functiond secondary information by obtaining the balance sheets of the mingled companies. The grocery store make do and revenues of five major brands- Axe, Adidas, Nivea, Wildstone and Park Avenue will be analyzed.IntroductionMonopolistic contentionMonopolis tic argument is a type of imperfect competition much(prenominal) that many producers sell intersection points that are differentiated from one an early(a) as goods exclusively not perfect substitutes (such(prenominal) as from branding, quality, or location). In monopolistic competition, a firm takes the prices charged by its rivals as given and ignores the impaction of its own prices on the prices of other firms.1 In a monopolistic altogethery competitive securities industry, firms cornerstone behave like monopolies in the short run, including by using market power to generate profit. In the long run, however, other firms enter the market and the benefits of differentiation decrease with competition. There are six characteristics of monopolistic competition (MC)* Product differentiation* Many firms* Free entry and exit in the long run* Independent decision making* Market index number* Buyers and Sellers do not have perfect information(http//en.wikipedia.org/wiki/Monopolisti c_competition)Economic backdropThe deodorant market in India is estimated at Rs 900 crore. Mens deodorants run the category with a 70 per centime share estimated at Rs 650 crore. The portion is expected to grow 25 per cent annually to become troika times its current size in the next five years. The boilersuit deodorant market has grown by about 40 per cent a year in the past five years operate by introduction of new brands and aggressive media promotions. The market will persist in to grow at 20-25 per cent thanks to low penetration and availableness at low price points. Deodorant sales are seasonal maximum sales happen in the summer months (April to September).About 90 per cent of the market is keep downd in the mass component (with deodorants priced between Rs 125 and Rs 175 for a 150 ml pack). With new players go in the category at popular price points, the mass segment, with brands like Axe, Adidas, Nike and Reebok, will continue to grow faster and command higher sha re in the deodorant market. The size of the premium and above segments, which have brands like Burberry, The consistency Shop, Kenzo and Ralph Lauren, will double by value in the next five years. (http//www.business-standard.com/india/news/kit-the-men%5Cs-deodorant-market-in-india/443714)MethodWe will be using the financial tools of various ratios to determine which company has been more than winnerful in this market.SurveyThe survey was conducted on 200 manlys in the college and office going crowd the results were as follows.1. Which Deodorant do you wont?AnalysisAs we can turn back from the above represent that Axe has a majority amongst the people surveyed while the others are below 10%. This gives us a picture of the command of Axe in this market and same is the case when market share all over India is observed.2. Reason for buying the particular brand.From the above graph we find that the decision of people in the age group of 15-25 behind buying a particular deodorant is not its fragrance but its price followed by easy availability and advertising. This shows us that main compute which affects a consumers decision, in this age group is the price of the convergence followed by other factors regarding quality, availability etc.This was the result obtained from the office crowd which gave an entirely different reason. The consumers decision in this age group is impact by the brand as people become brand conscious and are more bothered about which brand they use quite an than its use. After the brand value the price affects their decisions. Hence from both these results we see that consumer behaviour varies on the different age groups and changes as a consumer grows sexagenarianer. Findings bear on Mahikaansh ReddyBrand hack (Hindustan Unilever) hack was throwed in France in 1983 by Unilever. It was excite by another of Unilevers brands, Impulse. Unilever were keen to capitalize on chops French success and the rest of Europe from 1985 onwar ds, later introducing the other products in the range. Unilever were unable to use the name axe in the coupled Kingdom and Ireland due to trademark problems so it was launched as Lynx. The European launch of the deodorant was followed by success in Latin America and naturalise impact in Asia and Africa. In the new millennium, the brand has launched with great success in the United States and Canada. The company has also consolidated its deodorant portfolio by migrating other overlapping male deodorants into the Lynx brand such as South Africas Ego brand.In January 2012, Unilever launched its first Lynx product for women in the United Kingdom as part of a international expansion of the previously mens-only brand. The AXE deodorant was popular in India in the Grey market (duty paid shops). Impressed by the lot of AXE sold there, AXE deodorant was launched in India in 1999. The brand launch was very quiet and had the dodge of High Price, Low onward motion. At that time, the deodor ant market was a nascent one with an estimated market size of Rs 72 crore. HLL, at that time, had the brands Denim and Rexona and was ruling the market. AXE was priced at a premium.In upright three years flat, AXE had a market share of over 35% and HLL started phasing out Denim to concentrate more on AXE. It is known for its very controversial advertisements which actually helped in its publicity and led to a faster growth in the industry. Its lay group was mainly men between the age group of 18-24 as they were seen as the easiest to convince with such advertisements. Not only does the brand use TV commercials to its advantage, but it also uses its print ads effectively. Besides print, the brand also uses outdoors for maximum impact. Hence, Axe is a classic example of the 360 level branding effort. Therefore Axe is a perfect example of how principal(prenominal) advertising is for a brand and how it can lead to higher revenues. trade Mix1. Product 2. Place Available at all malls crosswise India. Every deodorant selling shop will 99% be selling Axe. All other variants of Axe brand could be purchased from conventional retailers viz. BIG BAZAAR (PANTALOONS RETAIL INDIA LIMITED). 1. Promotion Concentrates on single- segment male youth and targets young at heart. The competitive advantage of this brand is its complete monopoly over this proposition. The Axe Effect is one of the most storied claim in the world. This so called effect is supposed to draw women in hordes to any male who has sprayed himself liberally with the Axe deodorant. The advertisements are very shiftiness and usually display a formula male but with lashings of self-assurance as an Axe user. The females get irresistibly drawn to this male implying that Axe acts like a nasal aphrodisiac.2. The Axe brand of deodorants is from Unilever and is in the main targeted at 15 to 25 year old males. The brand portrays normal yet cool, trendy and confident, a positioning that is aspirational to the tar get segment. At a more subtle level, the Axe Effect also acts on the cartel levels of the user. The very act of being associated with the brand serves to boost the ego. The success of AXE attracted lots of new brands which were trying to follow the same marketing strategy as AXE.The one notable difference though is that all these newbies use hunks as opposed to the regular guys which are a stable for the Axe advertisements. This strategy has proven very effective for the brand. It comes across as approachable and it acts like a confidante and friend to its users. They are currently distributed in more than 40 countries. Unilever started out allotting roughly 60 percent of its advertising budget to television, but it has since winnowed that down to about 30 percent, pouring more property into offbeat alternatives.Competitive analysis Axe faces competition from new entrants such as Wildstone, Adidas, Park Avenue etc. However among all these brands AXE has a dominating share in the m arket because of the brand honor and brand loyalty that it has built and is leveraging the same. AXE has a wide-cut acceptance among the youth which forms the major chunk of perfume & deodorant users. Vis--vis all these the AXE deodorant never forgets to promote any of its new product. AXE time and again, on launch of the new product goes for PR as well as wide advertising campaigns.3. Target group- 18 to 24What next?As such, I believe that AXE has the potential to disruption its reach and increase its market share by expanding into the 35-50 year old demographic. In doing so, AXE will need to associate and disassociate itself with a more mature brand image and its inexpensive nature respectively, thereby attracting the average male aged 35-50 years. Hence it needs to re-focus the marketing blend in towards 35-50 year old demographic, whilst retaining its keystone market, the 16-25 year olds.ConclusionAxe has a very large share in this market and has hardly got a foot wrong. It just needs to follow its tried and tested market strategies and build upon it, by doing that it can thwart the competition and maintain its soma of monopoly in the market. The only thing that could be suggested is to increase its target group so that it could expand more in the market and serve a larger base leading to higher revenues. Hence Axe just needs to follow what it was doing from before and be wary of the new competition in this segment with the help of excessive advertising and PR.