CASE 01: TOTAL INDUSTRIES
Abhinav Kumar was totally unprepared for the news. And what surprised the 34 year old scion of the Kumar family – which had interests in a range of industries including batteries, consumer durables, soaps and oils, and switchgears – was that if was his 36 year-old Wharton School classmate, Rakesh Bhatia, who gave him the scoop over their dinner meeting. Bhatia headed a small engineering company in Phoenix, Arizona (US), but was remarkably networked in the industry.
“I hear your competition just got bigger.” He ribbed Kumar.
“What do you mean?” Kumar asked, surprised.
“Haven’t you heard that OLT and Control Equipment are talking about a merger?” The two switchgear companies were competitors of the Rs. 1,750—core switchgear division of total Industries, Kumar’s diversified family-managed company.
Kumar almost choked on his soup when he heard that. Such a merger would mean that Total would, overnight, lose its No.1 position in the industry, its 23 per cent market share in switchgears would be eclipsed by the combined 33 per cent share of PLT and Control.
“Who told you this?” Kumar asked.
“You are not going to believe this. It was a merchant banker sitting next to me on my flight from New York. In fact, this guy was flying down to Mumbai to meet the CEOs of the companies.”
“Switchgears is our most profitable business, Rakesh. I can’t afford to let any competitors to muscle us out of the market.”
“That will happen if the merger happens. The new entity will have better bargaining power with their suppliers and customers; they may take a lead in product development, too.”
“That has been our strength so far. We not only launch better products but also deliver better service at cost-effective prices.”
Kumar excused himself to make a phone call. He called Manoj Kohli, the 42-year-old President of the switchgear division, on his mobile. “Manoj, can you postpone your Pune trip tomorrow. I need to meet you first thing in the morning.” Manoj knew something big was afoot. With the meeting fixed for 9 am. Kumar returned to the table.
………….. “Somehow, I am not convinced, said Deepak. “I fear that Total will end up being a guinea pig for testing strategy formulation. Yet, we do need an explicit strategy for tomorrow. I wonder what we should do.”
QUESTIONS:
1. Identify the problems in this case.
2. Assume any data regarding strengths and weaknesses etc. What strategic options would you recommend for total?
CASE 02: PSYCHOFRAPHIC PROFILES – KEY TO BUYERS’ MIND
Consumer buying research has turned over a new leaf in India. The era of demographics seems to be on the backbench. Now, Marketing Research people are less likely to first ask you about your age. Income, education, etc Instead, there is a distinct shift towards inquiries about attitudes, interests, lifestyles, and behaviour –in short, a shift towards a study of consumers’ minds called psychographics.
Pathfinders, the marketing research wing of Lintas, occasionally came out with its highly respected “Study on the Nation’s Attitudes and Psychographics (P:SNAP).” The first in this series was released in 1987 with an objective to develop a database of lifestyles and psychographics information on the modern Indian woman. The second was in 1993, and the third in 1998. Pathfinders chose the Indian woman as he subject for the study because of the belief that more often than not, in urban areas, it is the womanwho makes buying decisions.
The pathfinders’ study involves interviewing over 10,000 women over the entire country and segmenting them in clusters according to their beliefs, attitudes, lifestyles, and lastly their demographics profile. The idea is to identify groups of consumers with similar lifestyles who are likely to behave identically or very similarly towards products or services.
…………….
Momeeta is a self-confident, on-the-go woman, and not a homebody. She is fashion conscious and clothes herself in the latest designer dresses. Even at 40, she can carry off a mini with aplomb. She is financially very secure and hence does not shop with care. She shops for quality, expensive, and goes by the brand name, not the price. She frequently travels abroad, buys expensive gifts for friends, and has an international understanding on what is “chic” at the moment.
QUESTIONS
1. A manufacturer of personal care products in the premium category wants to develop various products. Which of the above types should the manufacturer target? Explain.
2. How is the above-mentioned information likely to benefit a marketer in selecting marketing communications?
3. Which of the above-mentioned segments are likely to respond to sales promotion? Explain.
CASE 03: LOOK MA. FAIR HANDS
The glow on Rakesh Kumar sinha’s face is hard to miss----and ii’s all due to Fair Glow, the fairness soap from the Godrej stable. No Sinhas isn’t a user, but as vice president for sales and marketing at Godrej consumer Products, he has reason to be bright----again.
For the past three months. Fair Glow has been growing at close to 40 per cent; Sinha claims that the advertising support for the brand has also doubled since last year. Agency Mudra, which handles the brand, says there will be “interesting activities” around the brand in the next few weeks.
….).
The sales graphs, though, remained dim. By mid-2004. Fair Glow put the cap on its cream misadventure. It followed with an ad campaign in late-2004 that illustrates the efficacy of the soap. That’s paid off dividends, and sales are currently up. Whether they’ll be able to reach their previous highs is anyone’s guess.
QUESTIONS
1. What is the positioning of Fair glow soap? Why is this positioning likely to appeal to Indian consumers?
2. Why was the extension of fair Glow to face cream a bad decision?
CASE 04: TAJ HOTEL
Right from early 1900s, the Taj stood for class and comfort. It was a place where viceroys of the Empire arrived and departed amidst scenes of splendour, typical of Raj. From the very beginning it was one of the wonders of the Orient Singapore’s Raffles. Hong Kong’s Peninsula, and Frank Lloyd Wright’s Imperial did not come up to the level of the Taj in spite of their rich ancestry. The reason the hotel towered over the rest was because of the amazing attention to detail that was paid by its founder. Jamsetji Nusserwanji Tata himself. It was a time when Indians were not allowed to enter most of the prestigious hotels and …..
parameters were based not on quantity but quality. The focus of research was on things that go into creating images of wonderful hospitality, such as the quality of check-in, the smile, the greeting, or the welcome drink etc. The insights gathered were analysed extensively and a cleat slot, which the Taj could occupy when Global competition arrived, emerged. The slot was an emotional one. This was translated into creating a distinct personality of the Taj as caring, efficient, and enigmatic. The line went. “She is the Taj.” The base line was. “Nobody cares as much.” Today, after a century since it was established, the Taj is all set to conquer. Economic Times of December 15, 2004 reported I it’s ‘Brand Equity ‘that among hotels. Taj is ranked as “number one brand followed by Oberoi Hotels, ITC Hotels and Hayatt, respectively.
QUESTIONS
1. Analyse the case and determine the positioning of Taj. Do you think the advertising theme that is appropriate to reflect what a aims to communicate?
2. Why Taj did spent large sums of money to renovate its hotels?
3. Suggest an appropriate theme for an alternative campaign than the present one.
CASE 05: BYPASING PRACTICE
Arvind School, like most entrepreneurs, dreamt a lot. He dreamt customers would eagerly
Phone Woodstock Acoustic Systems in India. To order the latest, custom made stereo speakers. He saw demand rising and rising, cash flowing, and his technician producing superior quality products that were delightful and appreciated by the Woodstock customers, and favourable word-of-mouth spreading.
Arving had a degree in mechanical engineering from Delhi School of Engineering but his hobby was always acoustics. Like most entrepreneurs he had taken a long time in developing his dream. It was during the course of completing his studies in engineering that he became interestedin audio science and devoted time to his hobby. Just after completion of his studies, Arvind started working on creating stereo speakers in his garage. He named his enterprise Woodstock Acoustic Systems. He would design a pair of speakers and invite a couple of his friends to listen and give their opinions. Occasionally, on the recommendations of his friends, one or two customers would come and after demonstration would buy a pair. After a year, his parents told him that he had spent enough time working on creating his ideal stereo speakers, and now he should look for a job to start his career.
…………It seems this year will earn a profit of about Rs.9 lakhs. Perhaps he is going to make it. As he puts back the projections on the table. Arvind’s mind drifts tohis plans of introducing two new models Minnow (Rs. 168,000 per pair) and the Rostuk (Rs. 340,000 per pair ). He knows that there is a considerable potential in the foreign market for his speakers. Should he use the samedirect marketing strategy for foreign markets, or should he consider distributors. The dreamer is visualising.
QUESTIONS:
1. Why did Arvind establish a direct marketing channel?
2. What objectives and constraints have shaped his channel decision? If you were a consultant, what distribution channel strategy would you recommend Arvind for domestic and foreign markets?
CASE 06: THE BIG ADVANTAGE
Ten-year old Praveen is hooked on to Candico’s big Bubble Gum after his cousin introduced him to it a few months ago. Now he asks retailers only for the big Bubble Gum. The reason: “It is the only bubble gum with which I can blow large bubbles. Ask my friends,” he says. Loyalty from numerous such children has enabled Candico to become India’s number one bubble gum company. Candico (i) Ltd., part of the Sancrop Group, ran full page advertisements in November, 1999, with claims of selling 60 lakh bubble gum pieces a month, Competitiors such as Perfetti and Jayco have not responded to these claims. It is this silence, which Candico sees as a vindication of its stand. The vehicle behind its stupendous success has been big Bubble Gum, the 50 paise gum. Launched in June 1999, the market for big Bubble Gum exploded in a span of five months.
……………According to the projections made in a recent report by consultancy firm McKinsey, the Indian confectionery market will grow to Rs. 6,4000crore (present estimates peg the market at Rs. 1,500 crore) by 2005. “As long as Americans teach us the American way of life, bubble gum sales are here to stay and boom.” Jokes Kumar, “More seriously,” he adds, “chewing has always beena part of Indian tradition, we are only converting it into a pocket holding opportunity.” Candico’s big Bubble Gum, illustrates the point beng made by market analysts for years. In a country like India, the road to success involves, targeting volumes with low-priced goods. In that case, Candico has the right ideas.
QUESTIONS
1. What are the significant issues in the case?
2. Evaluate Candico’s strategy. What external factors have been kept in mind while developing the strategy?
3. Is the competitive advantage of Candico sustainable in the long-run? Explain.
CASE 07: SERVICE DIFFERENTIATION AT BRITISH AIRWAYS
Since, 1990s, international airlines saw increasing competition and providing services became a major factor to differentiate and a key to success. Carriers lost billions of dollars and needed to raise the Airfares. Some airline executives believed that improved service package would make increased fares more acceptable to the customers. Adopting this approach, companies started focusing on services rather than competing on price dimension. No one did it better than British Airways and in an annual poll conducted by a magazine, business travellers rated British Airways as providing the best service.
British Airways has come a long way since 1982 when it lost $ 1 billion, an industry record. When Colin Marshall took over as CEO in 1983, everyone in the industry made fun and laughed at the carrier. Comedians referred to it by its initials BA, as “Bloody Awful”. Employees’ morale had hit rock bottom, thousands of employees were laid off, and those remaining were embarrassed to work for the world’s worst airline. Marshall’s first challenge was to restore price. To send a clear message to the employees and potential customers, he ordered newly designed uniforms for all personnel. The planes were repainted with bright stripes with the motto “To fly to serve.”
………………..
British Airways would like to provide its much lauded service to the passengers across the world. In July 1992, it finalised an agreement with US Air to form a transatlantic alliance. But it withdrew its $ 750 million bid for 44 per cent of US Air, as it became clear that the U.S. government would not approve the deal. The proposed deal resulted in protests from major U>S> airlines, which claimed that the British would have a substantial head start in becoming the first global airline. British Airways second bid of $ 300 million for 19.9 per cent of US Air was approved in March 1993. Together, the two carriers were to serve 339 cities in 71 countries.
QUESTIONS:
1. Analyse the case and identify reasons that made the British Airways a laughingstock in the industry? Why was it necessary to change the employees’ attitude toward service?
2. What effect the new alliance would have on the services offered by other airlines?
3. Why would a passenger pay30 per cent more to fly the same destination?
CASE 08: OFF COLOUR
Despite Periodic makeovers colour cosmetics brand Tips and Toes is losing its sheen. Reinventing a brand is always a challenge in a market where product life cycles are as short as four or five months, driven by fickle trends and seasons.
A strong case in point is Tips and Toes, launched by Paramount Cosmetics in 1979, which started as a nail colour brand and then grew to include lipsticks and other cosmetic and toiletry products.
After a series of brand extensions and re-launches, the brand is looking for some “divine” inspiration to make its mark in an increasingly competitive business. The latest avatars of Tips and Toes are the Goddess and the Eve Divine ranges, which hit the market early this year.
However, neither of the products has acquired many converts. Brands like Lakme, Revlon and Lissome ( a new entrant in the economy segment ) are still far more visible on a cosmetic retailer’s shelves.
A visit to any marketplace in Mumbai shows that at least four out of 10 retailers think that the brand has been phased out. And the remaining don’t want to stock the brand anymore.
This marks a stark colour contrast to the 1980s when the brand enjoyed tremendous equity as the only other organised player apart from the Tata-owned Lakme in the cosmetics business. It rose to dominate about 30 per cent of the nail colour market.
…………………..But for that, Paramount will have to fight for its share of consumer mine-space. Despite spurts of advertising in women’s magazines, the brand has stayed in the shadows through most of the 1990s. Though Paramount claims it spends about 15 per cent of its turnover on ads and below-the-line activities, lack of consistent mass-media advertising has pushed the brand onto the side lines. Tips and Toes distributors and retailers in Mumbai vouch for that.
“The more visible the brand is, the more customers ask for it. Demand is directly proportionate to advertising in the mass media,” says one of them. Will tips and Toes listen to its past to add colour to its dull present?
QUESTION:
1. Study the case and identify the stage of Tips and Toes life cycle. What mistakes Paramount Cosmetics committed for its brand Tips and Toes.
.
Abhinav Kumar was totally unprepared for the news. And what surprised the 34 year old scion of the Kumar family – which had interests in a range of industries including batteries, consumer durables, soaps and oils, and switchgears – was that if was his 36 year-old Wharton School classmate, Rakesh Bhatia, who gave him the scoop over their dinner meeting. Bhatia headed a small engineering company in Phoenix, Arizona (US), but was remarkably networked in the industry.
“I hear your competition just got bigger.” He ribbed Kumar.
“What do you mean?” Kumar asked, surprised.
“Haven’t you heard that OLT and Control Equipment are talking about a merger?” The two switchgear companies were competitors of the Rs. 1,750—core switchgear division of total Industries, Kumar’s diversified family-managed company.
Kumar almost choked on his soup when he heard that. Such a merger would mean that Total would, overnight, lose its No.1 position in the industry, its 23 per cent market share in switchgears would be eclipsed by the combined 33 per cent share of PLT and Control.
“Who told you this?” Kumar asked.
“You are not going to believe this. It was a merchant banker sitting next to me on my flight from New York. In fact, this guy was flying down to Mumbai to meet the CEOs of the companies.”
“Switchgears is our most profitable business, Rakesh. I can’t afford to let any competitors to muscle us out of the market.”
“That will happen if the merger happens. The new entity will have better bargaining power with their suppliers and customers; they may take a lead in product development, too.”
“That has been our strength so far. We not only launch better products but also deliver better service at cost-effective prices.”
Kumar excused himself to make a phone call. He called Manoj Kohli, the 42-year-old President of the switchgear division, on his mobile. “Manoj, can you postpone your Pune trip tomorrow. I need to meet you first thing in the morning.” Manoj knew something big was afoot. With the meeting fixed for 9 am. Kumar returned to the table.
………….. “Somehow, I am not convinced, said Deepak. “I fear that Total will end up being a guinea pig for testing strategy formulation. Yet, we do need an explicit strategy for tomorrow. I wonder what we should do.”
QUESTIONS:
1. Identify the problems in this case.
2. Assume any data regarding strengths and weaknesses etc. What strategic options would you recommend for total?
CASE 02: PSYCHOFRAPHIC PROFILES – KEY TO BUYERS’ MIND
Consumer buying research has turned over a new leaf in India. The era of demographics seems to be on the backbench. Now, Marketing Research people are less likely to first ask you about your age. Income, education, etc Instead, there is a distinct shift towards inquiries about attitudes, interests, lifestyles, and behaviour –in short, a shift towards a study of consumers’ minds called psychographics.
Pathfinders, the marketing research wing of Lintas, occasionally came out with its highly respected “Study on the Nation’s Attitudes and Psychographics (P:SNAP).” The first in this series was released in 1987 with an objective to develop a database of lifestyles and psychographics information on the modern Indian woman. The second was in 1993, and the third in 1998. Pathfinders chose the Indian woman as he subject for the study because of the belief that more often than not, in urban areas, it is the womanwho makes buying decisions.
The pathfinders’ study involves interviewing over 10,000 women over the entire country and segmenting them in clusters according to their beliefs, attitudes, lifestyles, and lastly their demographics profile. The idea is to identify groups of consumers with similar lifestyles who are likely to behave identically or very similarly towards products or services.
…………….
Momeeta is a self-confident, on-the-go woman, and not a homebody. She is fashion conscious and clothes herself in the latest designer dresses. Even at 40, she can carry off a mini with aplomb. She is financially very secure and hence does not shop with care. She shops for quality, expensive, and goes by the brand name, not the price. She frequently travels abroad, buys expensive gifts for friends, and has an international understanding on what is “chic” at the moment.
QUESTIONS
1. A manufacturer of personal care products in the premium category wants to develop various products. Which of the above types should the manufacturer target? Explain.
2. How is the above-mentioned information likely to benefit a marketer in selecting marketing communications?
3. Which of the above-mentioned segments are likely to respond to sales promotion? Explain.
CASE 03: LOOK MA. FAIR HANDS
The glow on Rakesh Kumar sinha’s face is hard to miss----and ii’s all due to Fair Glow, the fairness soap from the Godrej stable. No Sinhas isn’t a user, but as vice president for sales and marketing at Godrej consumer Products, he has reason to be bright----again.
For the past three months. Fair Glow has been growing at close to 40 per cent; Sinha claims that the advertising support for the brand has also doubled since last year. Agency Mudra, which handles the brand, says there will be “interesting activities” around the brand in the next few weeks.
….).
The sales graphs, though, remained dim. By mid-2004. Fair Glow put the cap on its cream misadventure. It followed with an ad campaign in late-2004 that illustrates the efficacy of the soap. That’s paid off dividends, and sales are currently up. Whether they’ll be able to reach their previous highs is anyone’s guess.
QUESTIONS
1. What is the positioning of Fair glow soap? Why is this positioning likely to appeal to Indian consumers?
2. Why was the extension of fair Glow to face cream a bad decision?
CASE 04: TAJ HOTEL
Right from early 1900s, the Taj stood for class and comfort. It was a place where viceroys of the Empire arrived and departed amidst scenes of splendour, typical of Raj. From the very beginning it was one of the wonders of the Orient Singapore’s Raffles. Hong Kong’s Peninsula, and Frank Lloyd Wright’s Imperial did not come up to the level of the Taj in spite of their rich ancestry. The reason the hotel towered over the rest was because of the amazing attention to detail that was paid by its founder. Jamsetji Nusserwanji Tata himself. It was a time when Indians were not allowed to enter most of the prestigious hotels and …..
parameters were based not on quantity but quality. The focus of research was on things that go into creating images of wonderful hospitality, such as the quality of check-in, the smile, the greeting, or the welcome drink etc. The insights gathered were analysed extensively and a cleat slot, which the Taj could occupy when Global competition arrived, emerged. The slot was an emotional one. This was translated into creating a distinct personality of the Taj as caring, efficient, and enigmatic. The line went. “She is the Taj.” The base line was. “Nobody cares as much.” Today, after a century since it was established, the Taj is all set to conquer. Economic Times of December 15, 2004 reported I it’s ‘Brand Equity ‘that among hotels. Taj is ranked as “number one brand followed by Oberoi Hotels, ITC Hotels and Hayatt, respectively.
QUESTIONS
1. Analyse the case and determine the positioning of Taj. Do you think the advertising theme that is appropriate to reflect what a aims to communicate?
2. Why Taj did spent large sums of money to renovate its hotels?
3. Suggest an appropriate theme for an alternative campaign than the present one.
CASE 05: BYPASING PRACTICE
Arvind School, like most entrepreneurs, dreamt a lot. He dreamt customers would eagerly
Phone Woodstock Acoustic Systems in India. To order the latest, custom made stereo speakers. He saw demand rising and rising, cash flowing, and his technician producing superior quality products that were delightful and appreciated by the Woodstock customers, and favourable word-of-mouth spreading.
Arving had a degree in mechanical engineering from Delhi School of Engineering but his hobby was always acoustics. Like most entrepreneurs he had taken a long time in developing his dream. It was during the course of completing his studies in engineering that he became interestedin audio science and devoted time to his hobby. Just after completion of his studies, Arvind started working on creating stereo speakers in his garage. He named his enterprise Woodstock Acoustic Systems. He would design a pair of speakers and invite a couple of his friends to listen and give their opinions. Occasionally, on the recommendations of his friends, one or two customers would come and after demonstration would buy a pair. After a year, his parents told him that he had spent enough time working on creating his ideal stereo speakers, and now he should look for a job to start his career.
…………It seems this year will earn a profit of about Rs.9 lakhs. Perhaps he is going to make it. As he puts back the projections on the table. Arvind’s mind drifts tohis plans of introducing two new models Minnow (Rs. 168,000 per pair) and the Rostuk (Rs. 340,000 per pair ). He knows that there is a considerable potential in the foreign market for his speakers. Should he use the samedirect marketing strategy for foreign markets, or should he consider distributors. The dreamer is visualising.
QUESTIONS:
1. Why did Arvind establish a direct marketing channel?
2. What objectives and constraints have shaped his channel decision? If you were a consultant, what distribution channel strategy would you recommend Arvind for domestic and foreign markets?
CASE 06: THE BIG ADVANTAGE
Ten-year old Praveen is hooked on to Candico’s big Bubble Gum after his cousin introduced him to it a few months ago. Now he asks retailers only for the big Bubble Gum. The reason: “It is the only bubble gum with which I can blow large bubbles. Ask my friends,” he says. Loyalty from numerous such children has enabled Candico to become India’s number one bubble gum company. Candico (i) Ltd., part of the Sancrop Group, ran full page advertisements in November, 1999, with claims of selling 60 lakh bubble gum pieces a month, Competitiors such as Perfetti and Jayco have not responded to these claims. It is this silence, which Candico sees as a vindication of its stand. The vehicle behind its stupendous success has been big Bubble Gum, the 50 paise gum. Launched in June 1999, the market for big Bubble Gum exploded in a span of five months.
……………According to the projections made in a recent report by consultancy firm McKinsey, the Indian confectionery market will grow to Rs. 6,4000crore (present estimates peg the market at Rs. 1,500 crore) by 2005. “As long as Americans teach us the American way of life, bubble gum sales are here to stay and boom.” Jokes Kumar, “More seriously,” he adds, “chewing has always beena part of Indian tradition, we are only converting it into a pocket holding opportunity.” Candico’s big Bubble Gum, illustrates the point beng made by market analysts for years. In a country like India, the road to success involves, targeting volumes with low-priced goods. In that case, Candico has the right ideas.
QUESTIONS
1. What are the significant issues in the case?
2. Evaluate Candico’s strategy. What external factors have been kept in mind while developing the strategy?
3. Is the competitive advantage of Candico sustainable in the long-run? Explain.
CASE 07: SERVICE DIFFERENTIATION AT BRITISH AIRWAYS
Since, 1990s, international airlines saw increasing competition and providing services became a major factor to differentiate and a key to success. Carriers lost billions of dollars and needed to raise the Airfares. Some airline executives believed that improved service package would make increased fares more acceptable to the customers. Adopting this approach, companies started focusing on services rather than competing on price dimension. No one did it better than British Airways and in an annual poll conducted by a magazine, business travellers rated British Airways as providing the best service.
British Airways has come a long way since 1982 when it lost $ 1 billion, an industry record. When Colin Marshall took over as CEO in 1983, everyone in the industry made fun and laughed at the carrier. Comedians referred to it by its initials BA, as “Bloody Awful”. Employees’ morale had hit rock bottom, thousands of employees were laid off, and those remaining were embarrassed to work for the world’s worst airline. Marshall’s first challenge was to restore price. To send a clear message to the employees and potential customers, he ordered newly designed uniforms for all personnel. The planes were repainted with bright stripes with the motto “To fly to serve.”
………………..
British Airways would like to provide its much lauded service to the passengers across the world. In July 1992, it finalised an agreement with US Air to form a transatlantic alliance. But it withdrew its $ 750 million bid for 44 per cent of US Air, as it became clear that the U.S. government would not approve the deal. The proposed deal resulted in protests from major U>S> airlines, which claimed that the British would have a substantial head start in becoming the first global airline. British Airways second bid of $ 300 million for 19.9 per cent of US Air was approved in March 1993. Together, the two carriers were to serve 339 cities in 71 countries.
QUESTIONS:
1. Analyse the case and identify reasons that made the British Airways a laughingstock in the industry? Why was it necessary to change the employees’ attitude toward service?
2. What effect the new alliance would have on the services offered by other airlines?
3. Why would a passenger pay30 per cent more to fly the same destination?
CASE 08: OFF COLOUR
Despite Periodic makeovers colour cosmetics brand Tips and Toes is losing its sheen. Reinventing a brand is always a challenge in a market where product life cycles are as short as four or five months, driven by fickle trends and seasons.
A strong case in point is Tips and Toes, launched by Paramount Cosmetics in 1979, which started as a nail colour brand and then grew to include lipsticks and other cosmetic and toiletry products.
After a series of brand extensions and re-launches, the brand is looking for some “divine” inspiration to make its mark in an increasingly competitive business. The latest avatars of Tips and Toes are the Goddess and the Eve Divine ranges, which hit the market early this year.
However, neither of the products has acquired many converts. Brands like Lakme, Revlon and Lissome ( a new entrant in the economy segment ) are still far more visible on a cosmetic retailer’s shelves.
A visit to any marketplace in Mumbai shows that at least four out of 10 retailers think that the brand has been phased out. And the remaining don’t want to stock the brand anymore.
This marks a stark colour contrast to the 1980s when the brand enjoyed tremendous equity as the only other organised player apart from the Tata-owned Lakme in the cosmetics business. It rose to dominate about 30 per cent of the nail colour market.
…………………..But for that, Paramount will have to fight for its share of consumer mine-space. Despite spurts of advertising in women’s magazines, the brand has stayed in the shadows through most of the 1990s. Though Paramount claims it spends about 15 per cent of its turnover on ads and below-the-line activities, lack of consistent mass-media advertising has pushed the brand onto the side lines. Tips and Toes distributors and retailers in Mumbai vouch for that.
“The more visible the brand is, the more customers ask for it. Demand is directly proportionate to advertising in the mass media,” says one of them. Will tips and Toes listen to its past to add colour to its dull present?
QUESTION:
1. Study the case and identify the stage of Tips and Toes life cycle. What mistakes Paramount Cosmetics committed for its brand Tips and Toes.
.
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