AXE DEODORANT FOR MEN Marketing Plan
Group No. 7 Krishnamurthy G
17
Elias Alex
33
Saphalya Mohanty 38 Manish Murthy
39
Partha Patashani
42
Sagar Vora
58
Executive Summary Hindustan Unilever Limited (HUL) is India‟s largest consumer goods company based in Mumbai, Maharashtra. It is owned by the British-Dutch company Unilever, which controls 52% majority stake in HUL. Its products include foods, beverages, cleaning agents and personal care products. HUL‟s distribution covers over 2 million retail outlets across India.
The report is on AXE deodorant for men. It has the following section: 1. Introduction and the methodology. 2. SWOT Analysis 3. Segmentation, Targeting and Positioning strategy 4. 4 Ps for AXE 5. BCG Matrix 6. Ansoff Matrix 7. Analysis of Primary Research
AXE has a nation-wide presence and it has a strong distribution network. Due to this it has become easier for HUL to spread awareness about new AXE products. AXE body sprays and other products lead the men‟s grooming industry. 35 of our respondents favored AXE over other brands. The marketers want the people to believe in the AXE effect. Those who believe on AXE, they do so because of its persona, the ruggedness and the outdoorsy feel.
AXE is not only targeted at a younger crowd between 20 and 40 years, but also at people who are above 40 years. AXE enjoys the marketing majority due its marketing and positioning strategy.
Contents I. Introduction ................................................................................................................................... 4
II. SWOT Analysis ............................................................................................................................ 8 2.1. Internal Analysis .................................................................................................................... 8 2.2. External Analysis ................................................................................................................... 9
III. Segmentation, Targeting & Positioning ....................................................................................... 10 3.1. Primary Research Findings ................................................................................................... 10 3.2. Current Positioning ............................................................................................................... 12 3.3. Change required in positioning.............................................................................................. 13
IV. Marketing Mix ........................................................................................................................... 14 4.1. Product ................................................................................................................................. 14 4.2. Price ..................................................................................................................................... 14 4.3. Place..................................................................................................................................... 15 4.4. Promotion ............................................................................................................................. 15
V. BCG Matrix................................................................................................................................. 16 5.1. Question Marks: ................................................................................................................... 16 5.2. Stars: .................................................................................................................................... 16 5.3. Cash Cows:........................................................................................................................... 17 5.4. Dogs: .................................................................................................................................... 17
VI. Ansoff Model ............................................................................................................................. 18 6.1. Market Penetration................................................................................................................ 18 6.2. Market Expansion ................................................................................................................. 18 6.3. Product Development............................................................................................................ 18 6.4. Diversification ...................................................................................................................... 18
VII. Conclusion ................................................................................................................................ 19
References....................................................................................................................................... 20
I. Introduction Hindustan Unilever Limited (HUL) is India‟s largest consumer goods company based in Mumbai, Maharashtra. It is owned by the British-Dutch company Unilever, which controls 52% majority stake in HUL. Its products include foods, beverages, cleaning agents and personal care products. HUL‟s distribution covers over 2 million retail outlets across India.
HUL was formed in 1933 as Lever Brothers India Limited and came into being in 1956 as Hindustan Lever Limited through a merger of Lever Brothers, Hindustan Vanaspati Mfg. Co. Ltd and United Traders Ltd. It is headquartered in Mumbai India and has employee strength of over 16500 employees and contributes to indirect employment of over 65ooo people. The company was renamed in June 2007 as “Hindustan Unilever Limited”. Hindustan Unilever‟s distribution covers over 2 million retail outlets across India directly and its products are available in over 6.5 million outlets in the country. As per Nielsen market research data, two out of three Indians use HUL products. Its brands include
Food brands
Homecare Brands
Personal Care Brands
Water Purifier Brand
Chosen Product: AXE Deodorant History of AXE Axe was launched in France 1983 by Unilever. It was inspired by another of Unilever‟s brands, Impulse.
Unilever were keen to capitalize on Axe‟s French success and the rest of Europe from 1985 onwards. Unilever were unable to use the name Axe in the United 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 moderate 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 merging other overlapping male deodorants into the Axe brand such as South Africa‟s Ego brand. Introduction to AXE as a product Axe is a brand, owned by the British/ Dutch company Unilever and targeted towards young males. The fragrance range from popular scents to the least common scent called lemon-lime. From its launch, the yearly fragrance variant has played a key part in the success of the brand by offering something new each year. The type of fragrance variants has evolved over time. From 1983 until about 1989, the variant names were descriptions of the fragrances and included Musk, Spice, Amber, Marine, and Oriental. From 1990 until 1996, geographic names for fragrances were used, such as Africa, Alaska, Java, Nevada, and Inca. From 1996 to 2002, Axe took inspiration from Calvin Klein fragrances (also owned by Unilever at that time), using the same fragrance consultant, Ann Gottlieb, to develop the scents to launch variants, such as Dimension, Apollo, Dark Temptation, Gravity, and Phoenix. In 2009, the brand launched an 8-centimeter container called the Axe Bullet. The brand has also extended into other areas such as shower gels, after-shaves, and colognes, skin care, shampoo, and hairstyling products. Some of Axe‟s failed extensions include Barbershop and razors.
Most scent names usually have a shower gel to companion them and sometimes an antiperspirant/deodorant stick. The 2009 frame has a mint scent.
The Axe Shampoos come in two different sizes, the regular and most seen 12 oz size and the travel or sample size of 1.7 oz that has a different top, 22 oz bottles were introduced recently.
How Levers carved itself a niche in the deodorant market?
No one could have imagined that deodorants would become a 1000 tonne market in India by the millennium. Not because the need was not strong, but because it has always been a monumental marketing task, converting people from an old to a new way to meet a primary human need.
India, being a high-perspiration market and one where body odor (BO) sensibilities have always been sharp, camouflage products have always done well and for several decades a ritualized Indian existence included the usage of a perfumed soap and talcum powder combination. So when Hindustan UniLever (HUL, previously Hindustan Lever) decided to create a market for specialized deodorants with the launch of Rexona in the mid 90‟s, there was much skepticism.
However, the marketing pundits were proved wrong when the market itself grew from nearly nothing in 1995 to 308 tonnes in 1997 and was 616 tonnes in 1998. Other brands joined in, but the market creator‟s share stood at 57% in the initial years.
HLL understood the Indian market. It had a gut-level understanding of the precise coordinates of the target consumer on a two variable map (conservative- liberal scale on one axis, monetary tightfistedness on the other). They also had a feel of how quickly this was changing, how the transformation could be hastened and what could play the catalyst. That they had the marketing acumen, no one doubted, because back in the mid 90‟s Rexona was not the first deo to be launched. Baccorose was selling its Copper for men, with sensual ads that went „Before you get close, get Copper.‟ This was an aerosol spray deo, priced at Rs 200 for a 150 ml can. Fa, aimed at women, was the other brand in the fray. Neither of these had made a splash. HLL realized that Copper and Fa were aiming for those who understood the deodorant as being distinct from a perfume, and also the product‟s advantage over the old soap-talc combination, those who already knew the function of a deo. They aimed the product at a market, which already knew that that a deo delivers lasting BO freedom (all through the day) because it doesn‟t merely mask BO, but it actually prevents it. But the majority of Indian consumers couldn‟t guess it at the time, and that was why the two pioneers remained insignificant, even as the Indian talcum powder market stood firm at a huge 24,764 tonnes.
HUL understood that selling a deo would require market creation and it was important to disseminate information. So HUL‟s market approach was different. Research had shown that only 10 per cent of the target population had any awareness of deodorants, and a few felt that BO was their own private business! HLL understood that pitching a deo on a high-sensuality platform at this stage could botch up its chances for a wide consumption base. And that was what the company wanted: to enter the bathroom cabinet of the relatively conservative Indian household. So that was why the advertising had a good, clean, family setting – to sell the primary benefit. They knew that the time to do a „close-up‟ of the product benefits would come only later, once it had achieved a multi-generation approval. HUL was keen on „step-up ladder pricing‟. It wanted to attract people beyond the Indian elite. The latter in any case were already tuned in to using products like Old Spice, Denim, and other foreign brands. Thus it was the uninitiated Indian consumer that HLL wanted to target, a consumer who was contentedly using the soap/talc combination, a consumer who used perfume only occasionally. Fragrance sensitivity was an important factor as this was often a matter of consensus between the husband and wife. That was why it chose the brand: Rexona. Rexona was known in India as soap although globally it was an anti- per spirant brand. Actually that was what HUL wanted to launch first – the Rexona anti-perspirant. But they realized that an anti-perspirant would baffle people even more than a deo. Besides, an antiperspirant doesn‟t really stop all perspiration, and in a hot sweaty environment that India had, there was a risk that it would be labeled as a non-performer.
II. SWOT Analysis 2.1. Internal Analysis 2.1.1. Strengths: 1. Axe‟s tagline “Axe Effect” is well known among a huge customer base across different age groups. Therefore AXE enjoys huge brand equity because the consumer‟s perception of the brand happens to be good. The phrase “Axe Effect” is quite popular among men across different age groups and thus consumers already know the intangible value associated with the product. 2. Axe enjoys a huge distribution network of Hindustan Unilever. The distribution network of Hindustan Unilever happens to be one of the strongest in the FMCG sector. It covers nearly 1 million retail outlets in India directly and its products are available in over 6.3 million outlets in the country. 3. Axe is particularly a favorite of the youth population. So Axe‟s marketing team continuously focuses on the subtle shifts in the youth culture. Axe spends a higher percentage of its marketing budget on digital than any other Unilever‟s product. 4. Axe was the first to start an innovating mobile marketing strategy by introducing the “Call Me” campaign. With over 300 million mobile subscribers the mobile engagement allows for a scalable and a personalized engagement activity. Axe was the first to introduce an IVRS system marketing where in every caller would get a wake up service call from a girl and chance to win attractive prizes also. 2.1.2 Weakness: 1. Axe is primarily a product consumed by the young males of the country. So its target group appears to be monopolized towards male section of the society only. 2. Its flimsy advertising concepts depict women going crazy about the fragrance of the different variants of Axe‟s brand. Educated target groups consider this as a highly improbable situation. 3. Axe‟s products are generally considered as luxury products because of their relatively higher pricing.
4. Different customer surveys carried on shows a contrasting picture that the “Axe Effect” does not really exist. 5. All the different variants of Axe‟s products come at relatively same designing in packaging. 2.2. External Analysis 2.2.1. Opportunity: 1. Fashion conscious male population is increasing day by day. These people range across a wide age group i.e. (15-45). The grooming industry for fashion conscious males is rising. It is huge untapped market of around $2.5 million. 2. Men beauty product categories like hair gel, face creams, shaving creams, face wash etc. are still unexplored. Axe with its huge brand equity can easily enter into these product categories as well. 3. For female population in India, Axe has a huge potential. Axe has launched “Anarchy” brand, which comes for both men and women. Axe backed by HUL huge distribution network can easily tap into the female market segment where there are still very few and naive players like Fa, Nike etc. 2.2.2. Threats: 1. Threats can be from other imported brands like Set Wet, Zatak, Wild Stone etc. These brands are also performing decent in the Indian market. So threats are there from these imported brands and also from some local brands. 2. Government and International trade policies affect the prices. Quite often due to an increase in the transportation fares, surcharges, trade regulations etc. the prices become very volatile. Frequently the competitors try to decrease there per unit cost to boost up their sales. This also has an impact on the prices, as there is competition to leverage the competition.
III. Segmentation, Targeting & Positioning Axe has established itself as a brand for men with a target age group of 16-25 years. This group of people is generally more aggressive in buying lifestyle products. Here, Axe deodorant has an advantage of having a large group of potential buyers as its target audience.
This brand has its brand values as cool, fashionable and stylish. It characterizes a style of a person who carries it. Its users usually are high on confidence. This is evident from the fact that when this brand was launched in India by HLL in 1999, it was available as a premium brand and was priced higher than its brands of Denim and Rexona which are in the same category as Axe.
These core values of Axe make it popular among a huge group of men who consider themselves as achievers, stylish and also among those people who aspire to become like that. Here, there is no age limit. Prospective customer can be a successful businessman or retired personnel who relates to the brand.
The price range within which it is available in the market (approximately Rs.150) appeals to all the people who are in the middle income group and high income group. A person who can spend at an average of Rs. 200 per month on the lifestyle product is a potential customer for this brand.
3.1. Primary Research Findings
Based on survey of 121 people across different lifestyle, it was found that 29% of them prefer Axe brand of deodorant, as compared to the other brands. An overview of the consumer preference is explained with the pie chart below.
Set Wet (Zatak) Wild Stone Yardley 2% 2% 6% Secret Temptation 1% Reebok 4% Playboy 2%
Adidas 5%
Adidas Axe Change regularly Cinthol Axe 29%
CK Dove
Park Avenue 17%
NA Nike
Old Spice 1% Nivea 5%
Nike 15%
NA 8%
Change regularly Cinthol 2% 1% Dove 1%
CK 1%
Nivea Old Spice Park Avenue Playboy
The following table denotes the importance that people attribute to their acceptance of Axe brand. Axe Brand Preference Freshness 17% Flavours 34% Fragrance 37% Price 9% Availability 40% It can be seen that the fragrance, flavors and availability are three key factors, which attribute to the major market share of the product. The availability is an obvious attribute, given the distribution network of its parent company – Unilever across the country.
However, the loyalty to the brand, with introduction of different players in the market, was noticed to be low, with only 35% assured to continue with Axe brand. The company will have to focus more on retaining its customer base and increase brand loyalty among the consumers.
3.2. Current Positioning
From the day Axe was launched in France in 1983, it had a clear positioning. At the time when the world was still full of conservatives, Axe was positioned as an instant babe magnet. The rest is history. 24 years later, this brand is Unilever‟s bestselling brand worldwide.
All its campaigns revolve around a central theme of seduction, where the girl makes a first move. One of the peculiarities of its campaigns is that it never uses male models who carry personality of a Hunk or a very attractive personality. Instead the campaigns use male models that are ordinary guys or even skinny kind of people. And such guy being seduced by beautiful girls is shown as an „Axe Effect‟ in the campaign. This central theme is based on an assumption that every male likes to be seduced and this feeling definitely boosts the selfconfidence of a man. Also, the male models used are not shown as losers and the campaign takes care that they are projected as confident and self-assured.
Another major advantage for this brand is the non-existence of geographical boundaries. This is one brand which applies its marketing mix across geographical boundaries. The campaign that one sees in India is the same which the entire world is watching. When Axe deodorant was launched in India in 1999, HLL didn‟t bother to change its campaign and till today the trend is the same, that is, a single worldwide campaign.
Further, the brand has always come up with new fragrances and campaigns. Initially Axe was launched in fragrances of Java, Alaska and Atlantic. This was followed by a series of launches of variants almost each year. These variants are Voodoo, Denim, Touch, Dark Temptation etc. So, the customers are always taken at surprise by some of the very new fragrances like the Dark Temptation.
Axe has also been bullish about its presence across media. It has started an internet based marketing campaign in India. It is exploring the social media sites like Facebook, Twitter etc. for marketing and is positioning itself as a brand for the youth.
3.3. Change required in positioning
With the availability of so many brands in this segment, there is a clear threat to the dominance of Axe in the market. Many of these brands have the same theme of attracting women. There have been discussions every now and then that Axe should change its positioning. The consensus of the Hindustan Unilever Category Head (deodorants & oral care) – Srinandan Sundaram on this, is that the brand will not reposition itself. It will continue to remain „cool youth icon‟ and its target group will be guys of 16-25 age group. But recently Axe launched a fragrance for women with name „Anarchy‟. The campaign for this product was based on the same theme of seduction. But this campaign was criticized at many places. The things that appeal to a man might not appeal to a woman. There were criticisms that Axe would lose its credibility with the male customer base because if Axe sells the same product to an opposite sex then its theme of imparting self confidence among male with a product exclusive for them will be ruined. Though its campaign being criticized the product is doing well. And there also seems to be no signs of this affecting the popularity the brand among men.
The step ahead should be to continue to build parallel brands such as for women along with keeping the hold of its core customer base of young men.
IV. Marketing Mix 4.1. Product
AXE deodorants have a wide range of flavors like Axe Click, Axe Dark temptation, Axe Dimension, Axe Musk, Axe Twist, etc. Axe deodorant, which targets the youth people, has so many flavors to accommodate people with different tastes. They have so many options when it comes to fragrance that they cover majority of the people in the market. It is distributed by the Hindustan Unilever Limited, and is known for a quality product in the market. In the survey conducted by us, many people were happy with the quality of the deodorant and were attributing Axe to long lasting fragrance. If you see the packaging of the product also, the bottle is very sturdy and appeals to the target group. In fact, the bottle has made a name for itself and hence it is easily identified in a supermarket. In the market, Axe is a well-known brand and this itself is a great advantage for a product. In India, Axe is a leader in deodorants market and it is introducing lot of new flavors to hold the markets. Their efficient marketing strategies help them to maintain their new markets and they continue to search new markets.
4.2. Price
Though there are lots of flavors in Axe deodorants, all of them are priced in the same rate. They are targeting the middle and the higher income group. In the survey, we have observed that majority of the people are happy with the pricing and are willing to buy Axe deodorants priced around Rs.150 for 150ml bottle. Whenever they launch a new flavor, they give offers like 30% extra and they charge same price. As Axe is a known brand people are ready to try new flavors from Axe with these offers. By this way, Axe can get new customers and they can extend their market share in a great way. The competitive pricing of Axe compared to other deodorants and its strong brand value have given them an indispensable position in the market. In addition to this, Axe gives offers to the existing flavors also.
4.3. Place
Axe deodorants are available in almost every super market in major cities, medical stores, general stores and gift shops and body care stores. It has been observed from the survey conducted that most customers prefer to buy their deodorants from super markets. Axe uses these super markets and retail stores to sell a major chunk of their products in metros while in tier 2 and tier 3 cities, it is mostly done through kirana stores. In urban and suburban stores, all variants of axe deodorants are made available to customers. Axe deodorants enjoy the benefits of a good distribution network managed by Hindustan Unilever Ltd. Stockists are appointed in all regions to ensure the proper distribution of the deodorants. Each stockist maintains an inventory record which is monitored by the company. When the stock goes below a certain level, delivery order is automatically made. The stockists ensure the supply of the products to the retail outlets.
4.4. Promotion The mainstay of Axe‟s communication strategy has been advertisements. A majority of the respondents to the survey conducted have indicated that axe was brought to their awareness through electronic media. Axe‟s advertisements are very popular and are the most watched videos in YouTube among deodorant brand advertisements. Axe continues to use the electronic media to advertise the new fragrances launched. Axe also promotes its products through various campaigns like „Call me” which was extended to cafes and bars and Levis outlets where the company expects to find its target customers. Axe was the first to introduce promotion through gaming among deodorant brands with the introduction of the „Instinct‟ game which attracted as many as 3 million users. Axe has also come up with a similar game for its Musicstar fragrance. Axe has also entered the social media arena through Facebook pages that has registered a record number of visitors. Axe also launched their website „axevice.com‟ that contain a lot of games and fun activities, all designed to promote the products. Through these measures the company seeks to obtain a certain amount of preference in the minds of the customer. Advertising agencies continue to play a major role in promoting the brand. Most of the advertisements on electronic media are foreign which are tweaked for the Indian audience. Axe continues to launch newer and stronger fragrances in the market and with continued effective utilization of the different channels of promotion; axe can continue to maintain the market share that it owns.
V. BCG Matrix
5.1. Question Marks: 1) Summer 2) Touch The summer and Touch brands are relatively late launches in the market and have started grabbing a small portion of the overall axe sales. Currently, they are low on market share. Further promotion of the fragrances through financial inputs can help these fragrances take a larger share in the market. Stepping up the promotion for these can help achieve this.
5.2. Stars: 1) Denim 2) Inxtinct 3) Pulse The Denim, Inxtinct and Pulse fragrances have a large market share and show good growth. The market shares of these fragrances can be maintained and this would help obtain better returns from the brands.
5.3. Cash Cows: 1) Dark Temptation This fragrance, which was released ahead of the rest, still enjoys a large share in the deodorant market but its growth rate has significantly come down. The fragrance brings very good returns to HUL and the returns can be effectively used to promote the new brands like Summer and Touch.
5.4. Dogs: 1) Musk 2) Phoenix 3) Dimension The Musk and Phoenix brands have very low market share and the markets aren‟t growing. It would be futile to invest more on this brand.
VI. Ansoff Model 6.1. Market Penetration
With the current range of products, the company must look to increase its sales by employing different methods to capture the non-users and increase usage.
With intense marketing of the “Axe Effect”, it can intend to capture the users of the competitor products.
By convincing the non-users that usage of Axe attracts the opposite sex, the market share can also be increased.
To increase the purchase frequency, new design for the product may be introduced, which may increase the quantity per spray marginally, thereby increasing the usage.
6.2. Market Expansion The company can expand to other developing countries and make people aware of the advantages of deodorants and hence, capture the market. With a marginal increase in the pricing, it can capture the potential high-level customers, who believe that the quality comes with cost and then, the prices can be decreased gradually.
6.3. Product Development
With the expansion of business, the company must also develop new flavors, to keep the current trend, like the chocolate flavor which was recently introduced.
It should also consider addition of new features, such as 24 hour body odor protection, to its existing products, which will act as a sales advantage in the competitive environment.
6.4. Diversification
In view of the current competition, the company should also concentrate on increasing the market share of the related products such as Shower Gels, powders, shaving lotion, shampoos etc.
Section VII VII. Conclusion The Axe brand has established itself successfully in the market over the period, in such a conservative society, by first making people understand the need for a deodorant, and then selling them. The marketing strategies of Axe have always been a key factor behind the success story. Given the extensive distribution network for Unilever for its various products, it has been able to reach out to every corner of the country.
The SWOT analysis provided an overview of the current scenario of the brand and the BCG matrix described how the different variances of Axe impact the brand. The Ansoff model finally established the possible marketing strategies, which the company can implement, to retain and improve upon its market share. Having established itself in the male cosmetics industry, and the high competition level in the current scenario, the company should focus mainly on diversification and market expansion.
References http://www.business-standard.com/india/ http://www.hul.co.in/ http://www.indiainfoline.com/ http://www.businessweek.com/ Marketing Management by Philip Kotler, Kevin Keller, Abraham Koshy, Mithileshwar Jha. http://articles.economictimes.indiatimes.com/
