Product Life Cycle of Lux Soap

8/8/2019 Product Life Cycle of Lux Soap

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Production & material managementLife cycle of Lux soap

A new product progresses through a sequence of stages from introduction togrowth, maturity, and decline. This sequence is known as the product life

cycle and is associated with changes in the marketing situation, thus impactingthe marketing strategy and the marketing mix.

The product revenue and profits can be plotted as a function of the life-cyclestages as shown in the graph below:

Product Life Cycle Diagram

Introduction Stage

In the introduction stage, the firm seeks to build product awareness anddevelop a market for the product. The impact on the marketing mix is asfollows:

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Product branding and quality level is established, and intellectualproperty protection such as patents and trademarks are obtained.

Pricing may be low penetration pricing to build market share rapidly, orhigh skim pricing to recover development costs.

Distribution is selective until consumers show acceptance of theproduct.

Promotion is aimed at innovators and early adopters. Marketingcommunications seeks to build product awareness and to educate

potential consumers about the product.

Growth StageIn the growth stage, the firm seeks to build brand preference and increasemarket share.

Product quality is maintained and additional features and supportservices may be added.

Pricing is maintained as the firm enjoys increasing demand with littlecompetition.

Distribution channels are added as demand increases and customers

accept the product. Promotion is aimed at a broader audience.

Maturity Stage

At maturity, the strong growth in sales diminishes. Competition may appearwith similar products. The primary objective at this point is to defend marketshare while maximizing profit.

Product features may be enhanced to differentiate the product from that

of competitors. Pricing may be lower because of the new competition.

Distribution becomes more intensive and incentives may be offered toencourage preference over competing products.

Promotion emphasizes product differentiation.

Decline Stage

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As sales decline, the firm has several options:

Maintain the product, possibly rejuvenating it by adding new featuresand finding new uses.

Harvest the product - reduce costs and continue to offer it, possibly to aloyal niche segment.

Discontinue the product, liquidating remaining inventory or selling it toanother firm that is willing to continue the product.

The marketing mix decisions in the decline phase will depend on the selectedstrategy. For example, the product may be changed if it is being rejuvenated, orleft unchanged if it is being harvested or liquidated. The price may be

maintained if the product is harvested, or reduced drastically if liquidated.

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Lux soap was first launched in the UK in 1899 as a

flaked version of Sunlight soap. Subsequently it waslaunched in the US in 1916, and marketed as a laundry soap targetedspecifically at 'delicates'. Lever Brothers encouraged women to home laundertheir clothes without fear of satins and silks being turned yellow by harsh lyesthat were often used in soaps at the time. The flake-type soap allowed themanufacturer some leeway from lye because it did not need to be shaped intotraditional cake-shaped loaves as other soaps were. The result was a gentlersoap that dissolved more readily and was advertised as suitable for homelaundry use.Lux is currently a product of Unilever. The name "Lux" was chosen as theLatin word for "light" and because it was suggestive of "luxury."Lux toilet soap was introduced as a bathroom soap in the US in 1925, and inthe UK in 1928 as a brand extension of Lux soap flakes. Subsequently Luxsoap has been marketed in several forms, including handwash, shower gel andcream bath soap.Lux soap was launched inIndia in 1929. The very first advertisement in 1929featured Leela Chitnis as its brand ambassador. It was branded in India as "the

beauty soap of film stars'.As of June 2009 Lux is sold in over 100 countries .

From the 1930s right through to the 1970s, Lux soapcolours and packaging were altered several times toreflect fashion trends. In 1958 five colours made up therange: pink, white, blue, green and yellow. People enjoyed matchingtheir soap with their bathroom colours.

In the early 1990s, Lux responded to the growing trend away fromtraditional soap bars by launching its own range of shower gels, liquid

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soaps and moisturising bars. Lux beauty facial wash, Lux beauty bathand Lux beauty shower were launched in 1992.

In 2004, the entire Lux range was relaunched in the UK & Ireland toinclude five shower gels, three bath products and two new soap bars.2005 saw the launch of three exciting new variants with dreamy namessuch as Wine & Roses bath cream, Glowing Touch and SparklingMorning shower gels.

Did you know?

Since the 1930s, over 400 of the worlds most stunning and sensuouswomen have been proudly associated with Lux advertisements. Marilyn

Monroe, Brigitte Bardot, Demi Moore and, more recently, our ownCatherine Zeta-Jones, have all been part of the Lux glamour story.

The name Lux means light in Latin, however the name was chosen forits play on the word luxury.

Lux soap was first launched in the UK in 1899 as a flaked version of Sunlightsoap.Subsequently it was launched in the US in 1916, and marketed as laundry

soap targeted specifically at 'delicates'. Lever Brothers encouraged women tohome launder their clothes without fear of satins and silks being turned yellow

by harsh lyes that were often used in soaps at the time. The flake-type soapallowed the manufacturer some leeway from lye because it did not need to beshaped into traditional cake-shaped loaves as other soaps were. The result wasa gentler soap that dissolved more readily and was advertised as suitable forhome laundry use Lux is currently a product of Unilever. The name "Lux" waschosen as the Latin word for "light" and because it was suggestive of "luxury."Lux soap was introduced as bathroom soap in the US in 1925 and in the UK in1928 as a brand extension of Lux soap flakes. Subsequently Lux soap has beenmarketed in several forms, including hand wash, shower gel and cream bathsoap.Lux soap was launched in India in 1929. The very first advertisement in 1929featured Leela Chitnis as its brand ambassador. It was branded in India as "the

beauty soap of film stars'.As of June 2009 Lux is sold in over 100 countries

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Lux launched the worlds first mass-market beauty soap in the US in 1924 &had beenlaunched in India in 1929.At that time there was only one competitor of Lux, which was from its own

brand LIFEBUOY.In the initial stages Lux was introduced in the major cities of INDIA likeCalcutta, Mumbai etc.

MARKETING OBJETIVES - was to create the product awareness and toattract thecustomers towards the product.

The Lux MARKETING STRATEGIES in the initial stages :

Product = They offer only on product in the market. They did not come upwith thedifferentiated product.Price =In the initial stages of the product, they offer the relatively higher price

than their competitor (LIFEBUOY). Because, they want to recover their initialcost of making the product.

Advertising =In the initial stages, they allocate more advertising budgetSo that more and more customers could be attracted towards the product.In ads they targeted the early adopters, who were readiest to buy the product.The first ambassador, Leela Chitnis. Distribution =was selective and only covers the major cities of INDIAto get recognition in those cities. Their distribution channel was through: Manufacturer Wholesaler &

Retailer

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In the growth stage, their sales rapidly started rising.

They have expanded their market to the other cities of INDIA.MARKETING OBJECTIVES = The marketing objectives of the Lux wereto expand their market to the other cities of INDIA.

Another objective was to maximize more market share.

In the growth stage, company had the following MARKETING

STRATEGIES :

Product = In the growth stage, the company had offered the same product in

the market.Price = In this stage, the company had changed their price to some extent

because of maximizing the market share. ( Slightly cut down the prices )

Advertising = In the growth stage, they had increased their advertising budget

as in the initial stages because of attracting the new customers or to retain the

existing customers.

Sharmila Tagore, Hema Malini, Zeenat Amaan, Juhi Chawla, Madhuri Dixit,

Sridevi

Distribution = In this stage, company had expanded their market to the other

cities of INDIA. Their distribution channel was the same as in the initial stages

of the product.

Promotion = In the growth stage, the company had also used the differentproportioning strategies to attract the new and the existing customers

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They modified the product by adding some changes in the product.

In this stage, few competitors enter into the market like ( CINTHOL,FAIRGLOW, SANTOOR, CHANDRIKA, FIAMA DI WILLS and VIVEL ).

The company has expanded their market to almost all the cities of INDIA.

MARKETING OBJECTIVES = The marketing objective of Lux is tomaximize more profit while defending the market share. And to expand themarket to all the cities of INDIA.

MARKETING STRATEGIES In this stage are based on:Product= The Lux has made the modification in the product by introducing:

Lux Almond, Lux Orchid , Lux Fruit, Lux Saffron, Lux Sandalwood, LuxRose,Lux International, Lux Chocolate, Lux Aromatic Extracts, Lux Oil andHoney.etc

Price = The Lux products are now available at higher prices in the market, thereason behind is that the companys marketing objectives is to maximize more

profit.

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Distribution = Now Lux products are available in almost all the cities ofINDIA. Their distribution channel is same as in the initial stage.

Advertising = In this stage Lux advertising has been reduced to some extentbecause of the more brand awareness in the minds of customers.Recently, they have shown Aishwarya Rai , Kareena kapoor & Shah Rukhkhan.

PROMOTIONAL OFFERS :---- Like buy 3 get 1 free.

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Besides of all campaigns for the sales promotion of Lux .The reasons for itsdecline are :

1. Currency fluctuations: Unilever products are in over 100 countriesworldwide, As a result, it is exposed to adverse currency fluctuations.For instance, in 2004, a 5.9% decline in turnover was primarily due to a 4%appreciation in the average Euro exchange rate.

2.SLOWDOWN: In year 2008 - 09 due to hard economic conditions inINDIA and other countries the sales were highly affected as the consumerstarted looking for some alternate products with a cheaper price than Lux.

3.Competition: Lux has been facing competition from HUL itself (Lifebuoy)& from other companies like:-Godrej Consumer Products : GCPL, Indias second largest soap maker with9.2% market share.with leading brands such as CINTHOL, FAIRGLOW & NIKHAR.

Fairglow brand, India's first Fairness soap, has created marketing history as oneof the most successful innovations

Wipro : The presence of Wipro in the toilet soap industry can be seen through

their brands such as SANTO OR and CHANDRIKA. In the southern market ofIndia it is a major market player in toilet soap.

ITC :It entered the segment last year and has made a strong headway in ashort time by growing to 1.75% in just five months. With the brands like:Superia, Fiama Di Wills and Vivel

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PRICE:-price level,

Discount,

Special offers.

PLACE:- supermarkets,

Shops,

Mail orders,etc.

PRODUCT:- quality,

Design,

Image,

Name &

Packaging.

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PROMOTION:- advertising,

Competitions,

Sampling &

In-store display.

PRICE:-

Competitive prices: Neither high nor low

Price segment of toilet soaps

Segments Prices/weightPremium >Rs.15/75gms

Popular Rs.8-15/75gms

Economy


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PRODUCT:-

Product classification:- Tangible

Non durable

Logo:-

Labelling:- Lux trade character or logo is present prominently in the package.

Female models.

Displayed graphically- Key ingredients.

Packaging:- Differents colours- different

variants(Saffron-Saffron

variants & Pink Rose extracts etc.)

Packages size-100gm, 120gm, 150gm.

Launched- Mini Lux- 45gm- Rs.5/-

Promiinent variants:- Lux almond Lux orchid Lux pearl glow

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Lux renewal massage Lux crystal shine Lux rose

Lux

international Lux chaocolate Lux aromatic extracts

Creamy delight Lux Purple lotus Lux

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Lux body wash

Lux Shower gel range

Lux hand wash

Lux SPA


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PROMOTION:- Sales Promotion:- Lux presented 30gm gold each to the first

three winner of the Lux Gold Star offer

from Delhi. According to the promotional offers that Lux unveiled in

October 2000, a consumer finding a 22-carat gold in his or her soap bar

got an opportunity to win an additional 30gm gold. The first 10 caller of

every week got a 30gm gold each. The offer could be availed only on

100gm and 150gm pack of Lux soap.

Lux star bano, Aish karo contest. All one neede to do was

to buy a promotional pack of Lux soap. The pack comes

with a special scratch card. The 50 lucky winner and their

spouse were flown down to Mumbai to live a day like

Aishwarya Rai would. They could also be given gift

voucher worth Rs.50,000/- from Shopper Stops alongwith an exclusively designed by Neeta Lulla and a beauty makeover by

Michelle Tung, Aishwaryas preferred designer and stylist. The piece de

resisitance was a dinner date with Aishwarya Rai herself.

Lux celebrated 75year of stardom with the

Har Star Lucky Star Activity. All wrappers

of Lux had a star printed inside them. If theconsumer found written inside the star, any

number from 1 to 5, he or she would get an

equivalent discount (in rupees) on his or her

purchase from his or her shopkeeper. If the consumer found the 75

years written inside the star, he or she will get a years supply of Lux

free.

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Lux, the brand synonymous with beauty and stars, now takes its legacy a notch

higher by introducing the Lux Superstar offer. The

offer gives an opportunity to consumers to meet

Bollywood's Superstar couple Abhishek Bachchan

and Aishwarya Rai Bachchan in London.

Now anyone can get a taste of stardom and rub

shoulders with the power couple, all you need is to

purchase Lux soap and complete a slogan to stake a claim to an evening full of

glamour, glitz and glory. 12 lucky couples will be flown to meet Abhi & Ash in

London. Well, this is not all... there are exclusive signed photographs of thecouple to be won.

12 lucky couples could win a chance to go to London and spend an evening

with Abhishek and Aishwarya Rai Bachchan.

Promotion:-The first ambassador Leela Chitnis featured in a Lux advertisement which

flagged off the Lux wagon. She gave way to a galaxy of stars which includeMadhubala, Nargis, Meena Kumari, Mala Sinha, Rekha, parveen babi,Sharmila

Tagore, Waheeda Rehman, Sairah Banu, Hema Malini, Zeenat Aman, Juhi

Chawla, Madhuri Dixit, Sridevi, Aishwaria Rai Bachchan, Kareena

Kapoor,Priyanka Chopra and most recently Katrina Kaif.

The last frontier for most actors aspiring to stardom is becoming a Lux

ambassador. The brand has outlasted many soaps.

From the beginning, Lux became a household name in the country.

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in creating excitement in the market. Some argue that HLL was testing a newpositioning appeal to male users while others say that

it was a one time endorsement to break the clutter. Arecent ad of Lux featured the golden coupleAishwarya Ra i Bachchan and Abhishek Bachchan.They were paid Rs.25crore for this ad. But in all these advertisements thecelebrity never shadowed thebrand.From the beginning Lux, by using a leading film starof the time has fulfilled the consumers aspirations of us ing beauty soaps viathe rationale if its good enough for a film star, its good for me. This latermoved into a transformation role of having a bathwith Lux, which transports the user into a fantasyworld of icons, film stars and fairy lands.

Events:Lux celebrated 75 years of existence in a grand

way by unveiling Shah Rukh Khan as their latest brand ambassador.

Kareena Kapoor, Juhi Chawla, Sridevi and Hema Malini graced the event andmade it special. All this stars have endorsed Lux in the past. The event was heldat the Grand Intercontinental in Mumbai.

South Indian:-

JAYALALITHA (1970)

SHRIYA SHARAN

Change in communication strategyLux was always changing with the times. Whether in terms of product or interms of promotions, the brand kept the consumers excited. Lux was initially a

premium brand. It was being projected as an aspirational brand and the

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endorsements by stars further reinforced the positioning. However thecommunication was slowly seemed to be losing relevance, as consumers were

beginning to question if the film star actually used the brand. The increasingcompetition in the soap category also forced Lux to rethink on its targetingstrategy. Several competitive beauty soap brands had begun advertising usingsimilar methods of communication. The brand had a choice either tocompromise on market share or dilute the positioning. In this context, theglobal brand team for Lux developed a new communication strategy. Thisstrategy -bring out the star in you -for the first time moves the brand away fromthe long running film star route. The film stars still features in the newcommunication but not as her gorgeous self but rather as an alter ego/projectionof the protagonist, for a few seconds of the entire ad. Thus, for the first time thefilm star was used as a communication device and not as the main feature ofthe ad. The move away from the film star and her fantasy world to the regularLux user with the focus on the protagonists star quality is a change from thenorms set by the Lux advertising in the past. With the new communicationstrategy, the filmstar is used purely as a communication device to po rtray star quality in everyLux user. This can be significantly seen in the latest TV commercial of LuxCrystal Shine where Priyanka Chopra is portrayed as a normal woman. Thisidea-bring out the star in you -puts the consumer at the heart of brands promise.

The promise goes beyond the functional deliverables of soap, beyond bathingand bathroom to the world outside. Its the world where Lux on her side, anordinary woman can impact her world with her own star quality. This is asuccessful attempt to bring the brand closer to its users and give it a more usefuland contemporary image. Breaking away from tradition, HLL resorts to a maleand metro sexual Shah Rukh Khan to revive Lux which turned 75 in 2005.

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Marketing Project Reporton Lux Soap

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By:

Amit Kumar SinhaPGDMRM-002IPE, Hyderabad

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Contents:Company Profile HUL

Distibution Channel - HUL

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Product Mix HUL

Overview Lux SoapMarketing Mix

SWOT Analysis

Competitor Analysis

Market Segmentation

Recommendation

Reference

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Company Profile - HUL

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Company Profile - HUL

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A 52% owned subsidiary of Anglo Dutch giant Unilever.

India 1888

India largest FMCG company

Touching 2 out of 3 Indian consumer

20 distinct categories Home and personal care products, food

and beverages.

HLL HUL

100 factories India Manufacturing its diverse product range

Headquarter: Mumbai

Market share Toilet soap category 54.3%

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Revenue Percentage:

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Distribution Channel - HUL

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Distribution Channel - HUL

2000+ Suppliers and associates

4000 Redistribution stockists

Covering 1 million retail outlets

Reaching 250 million rural consumers

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Product Mix- HUL

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The width of the HULProduct mix: The width of the product mix refers to the

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number of different product line the company

carriesE.g: Personal wash

Laundry

Skin care

Oral care

Deodorants

Colour cosmeticsAyurvedic personal and health care

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Shampoo

TeaCoffee

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Foods

Ice creamWidth = 12

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The lenght of the HULProduct mix: The Lenght of the product mix refers to the totalnumber of items in the product mix.E.g: Personal wash: Lux, Lifebuoy, Liril, Hamam,Breeze, Dove, Pears, Rexona

Laundry: Surf excel, Rin, WheelSkin care: Fair & Lovely, Ponds, Vaseline, Aviance

Oral care: Pepsodent, Close up

Deodorants: Axe, Rexona

Colour cosmetics: Lakme

Ayurvedic personal and health care: Ayush

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Shampoo: Sunsilk, Clinic

Tea: Broke bond, Lipton.Coffee: Bru

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Foods: Kissan, Annapurna, Knorr

Ice cream: Kwality wallsWidth = 30

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The Depth of the HUL Productmix: T h e d e p t h o f t h e p r o d u c t m i x r e f e r s t ot h e n u m b e r o f variants of each product offered in the lineE.g: If close up toothpaste comes in three formulation and inthree sizes, close up has a depth of 9 (3*3)

The Consistency of the HULProduct mix:The consistency of the product mix refers to how closelyrelated the various product lines are in the use, productionrequirement, distribution channel or in any other manner.HUL Product line are not consistent because of its large width.

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Overview : Lux Soap 1916 Laundry soap

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1925 Bathroom soap

India 1929

First brand ambassador: Leela Chitnis (1929)

Market share is almost equal to Lifebuoy

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Marketing Mix:

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Product:Product Classification:Tangible

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Non durable good

Lux and other soaps fall into thecategory of convenience good.

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Product Life Cycle:Maturity Stage

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Prominent Variants:Lux almond

Lux orchid

Lux fruit

Lux saffron

Lux sandalwood

Lux rose

Lux international

Lux chocolate

Lux aromatic extracts

Lux oil and honey glow etc.

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Logo:Labelling:

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Lux trade character or logo is

present prominently in the packageFemale modelDisplayed graphically Key

ingredients

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Packaging:

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Price: Competitive prices: Neither highnor low

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Place: HUL distribution network key

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strength (Which helps reach out its

product across the length and widthof the vast country)

2000+ Suppliers & Associates 7000 Stockists

Direct coverage in over 1 millionretail outlets

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Network:Factory Company warehouses Distributor Market

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Factory Wholesaler & Big retailers

(Bulk orders) 30% Sales

Promotion:

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Active since 1929

Featured all top actress of their times.

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Idea: if it is good enough for a film star, it is goodfor me.

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First Male BrandAmbassador:

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South India:1970 JayalalithaShriya Sharan

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Sales Promotion: Lux gold star offer: 22 Carat Goldcoin in the Soap First 10 caller

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(Extra 30 gm gold)

Lux star bano, Aish karo contest: A

special promotional pack of lux soap Scratch card -50 lucky winner gotthe chance to meet Aishwarya rai.

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SWOT AnalysisStrengths:

Strong market research (Door to door sampling once in a year Rural andUrban area.)

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Many variants (Almond oil, Orchid extracts, Milk cream, Fruit extracts,Saffron sandalwood oil and Honey).

Strong sales and distribution network backed by HUL. Strong brand image Dynamically continuous innovations New variants and innovative

promotions (22 carat gold coin promotion Chance Hai) Strong brand promotion but relatively lower prices Winning combination. Mass appeal/Market presence across all segments ( 15% of soap market)

Weakness:-

Mainly positioned as beauty soap targeted towards women, lack unisex appeal Some variation like the sunscreen, international variant did not do well in themarket

Not much popular in rural areas

Opportunities:-

Soap industry is growing by 10% in India. Beauty segments compounded annual growth rate(CAGR) is very high. Liquid body wash is currently in growth stage- Lux should come out with more

variant in this segments. Large market share- Strong hold over the market

Threats:-

High internal competitions (Pears-beauty segments) New entrants (Vivel) Maturity stage-threats of slipping down to decline stage- if constant reinvention

is not carried out.

Internal Competitor:- Lifebuoy: 1895, 18% market shares

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External competitiors:-

Herbaria Merci

Clarin

Gender: female

Age:16-35

Income: middle income group (Rs.15-20)

Highest selling beauty soap in urban areas (rural area-lifebuoy)

Expensive-affordable

Target area: urban and sub-urban upper middle and middle class

people

Created good position: Buyers mind- Better product attributes, price and

quality.

Offering product in a different way

Offering: improved quality of the product- affordable price with high

branding- to position the product as a best quality beauty soap in buyersmind.

Market shares of Lux: 15%

Better positioning: market leader of beauty soap.

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Ayurvedic Variants

Lux Kids Special Soap

Target Rural Area

Target Male Customers

The beauty soap industry of India consists of a few producers in the industry.The Demand for this product is very much vulnerable in terms of pricing.Hindustan Unilever is providing LUX at a price which is affordable to most ofthe people in the country. Beauty soap is an uprising product in India as agreater portion of the population, both male and female, are now getting more

beauty conscious. As a multinational company Hindustan Unilever with heavypromotional activities, has been able to penetrate the market. With six differentfragrances, three different sizes, international standard and high quality design,as a product, LUX has been highly successful over the years. Its distribution

process is highly efficient. Its promotional activities, like the beauty contest has

been a milestone in attracting a huge number of customers. Overall with itsmarketing activities LUX has been a successful brand.

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Documents

Product Life Cycle of Lux Soap