Study on Marketing Mix - Deodorants of Body Shop-Case Study
Assessing Competitive landscape of Deodorants of Body Shop-A Case Study
·
With appreciable share in only
four markets, Finland, Hong Kong, Indonesia and Singapore, deodorants is one of
The Body Shop’s smallest sectors of interest. Western Europe, with Finland as
its core market, is the company’s most valuable region at US$4.7 million. With
a CAGR of 7% over the 2001-2005 period compared to 12% for the market, The Body
Shop was one of many deodorant providers that suffered as Beiersdorf and
Unilever strengthened their positions in the region.
·
The company offers only a
limited range, though the newly introduced Aloe Vera range does include an
anti-perspirant deodorant. Although its natural positioning could prove an
asset when any concerns are raised, for example, about the connection of
deodorants with breast cancer prompted by a hoax email campaign, The Body Shop
needs to advertise the effectiveness of its products in order to attract
consumers. When it comes to unproven health risks versus the risk of body
odour, most consumers will look, above all, for a product that they trust to
work.
·
In Asia-Pacific, the company
outperformed the Indonesian deodorants market with a CAGR of 50% over the
2001-2005 period, albeit from a low base, benefiting from strong consumer
interest in roll-on deodorants. After many years of good sales, the company
lost momentum in Singapore, registering negative growth over the 2004-2005
period, as spray deodorants overall suffered from an increasing consumer
interest in the roll-on format in the country.
Prospects
·
With a forecast CAGR of 3%,
deodorants will continue to be an attractive sector over the 2005-2010 period.
As deodorants sits fairly well within The Body Shop’s product portfolio, it is
a sector that the company could consider expanding further, using existing
products and distribution channels. The Body Shop’s deodorants could be
introduced as part of the new store expansion programme in the developing
world, which would enable it to benefit from the marketing activities connected
with store openings, and also to establish the brand within the deodorants
market from the start. Such a move would enable the company to take advantage
of a forecast CAGR of 4% and 12% in Russia and India respectively, equalling a
combined value of US$110 million.
·
In existing markets, the
company will need to step up its marketing of deodorants in order to boost
sales. It is not enough to develop them as part of existing ranges, or try to
sell them simply on the strength of The Body Shop brand: in order to tear
consumers away from brands easily available on supermarket shelves, the company
needs to convince customers that its deodorants will work as well as Nivea,
Dove, Sure et al.
·
Over a third of the forecast
added value of US$2 billion is predicted to be generated in Latin America
(US$760 million), followed by Eastern Europe (US$322 million), where The Body
Shop’s presence is limited. While at a slower rate, growth in The Body Shop’s
existing markets, especially the currently underdeveloped market of
Asia-Pacific (CAGR 5%, 2005-2010), will also be fairly dynamic, but
Asia-Pacific has traditionally had a very small deodorants market as the
cultural preference has been towards other products, such as talcum powder. Now
that the market is changing, and consumers in the region are beginning to turn
towards Western-style deodorising, other companies are increasingly targeting
the market, which will result in a high degree of competitiveness in the medium
term.
Also read Survey Questionnaire on hair care products of body shop. Contact Mahasagar Publications for further information.
