Final Report Lux Marketing 1l3j3o

Declare your beauty

MARKETING RESEARCH PROJECT REPORT PRESENTED TO: Ms. Mahjabeen Rafay PRESENTED BY  AZEEM BARI  FARAZ FAISAL  WALEED BIN TARIQ  FIZA IMRAN  SANA TARIQ  FATIMA GUL

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Declare your beauty

CONTENTS STRATEGIC PLANNING OF LUX................................................................................................7 MARKETING STARTEGY AND MARKETING MIX OF LUX............................................................10 MARKETING STRATEGY.......................................................................................................10 MARKET SEGMENTATION....................................................................................................10 MARKET TARGETING...........................................................................................................11 POSITIONING.......................................................................................................................11 THE MARKETING MIX.............................................................................................................11 PRODUCT............................................................................................................................11 PRICE..................................................................................................................................12 PLACE.................................................................................................................................12 PROMOTION........................................................................................................................12 MANAGING THE MARKETING EFFORT....................................................................................13 MARKETING ANALYSIS...........................................................................................................13 SWOT Analysis...................................................................................................................13 SWOT ANAYLSIS OF LUX UNILEVER PAKISTAN........................................................................13 Strengths...............................................................................................................................13 Opportunities.........................................................................................................................14 Threats.................................................................................................................................14 MARKETING PLANNING..........................................................................................................15 Current Situation.....................................................................................................................15 Objectives and Vision..................................................................................................................16 Marketing strategy......................................................................................................................16 Action Programs.....................................................................................................................16 Marketing Controls..................................................................................................................16 2

Declare your beauty MEASURING AND MANAGING RETURNS ON MARKETING INVESTMENTS................................17 UNILEVER’S MICRO-ENVIRONMENT........................................................................................18 THE COMPANY....................................................................................................................18 Marketing Intermediaries...........................................................................................................19 Advantages of Retail Cross-Docking.........................................................................................19 Disadvantages of Cross-Docking..............................................................................................19 COMPETITORS.....................................................................................................................20 Internal Competitors.............................................................................................................20 External Competitors.............................................................................................................21 PUBLICS..............................................................................................................................21 CUSTOMERS........................................................................................................................22 MARKETING RESEARCH.........................................................................................................22 Issue..................................................................................................................................22 Analyzing and using Marketing Information..........................................................................25 Consumer view on LUX (both imported and local).............................................................25 Unbiased consumers..........................................................................................................26 LUX CRM (Customer relationship Management).................................................................27 LUX: MODEL OF CONSUMER BEHAVIOR.................................................................................28 Characteristics Affecting Consumer Behavior.......................................................................31 Cultural factors..................................................................................................................31 Culture:...........................................................................................................................31 Subculture:.....................................................................................................................31 Social class:....................................................................................................................31 Social factors.....................................................................................................................32 Groups and social networks:...........................................................................................32 Online social Networks:...................................................................................................32 Family:............................................................................................................................32 Roles and status:............................................................................................................32 3

Declare your beauty Personal factors:................................................................................................................33 Age and life cycle:...........................................................................................................33 Economic Situation:........................................................................................................33 Lifestyle:.........................................................................................................................33 Psychological factors:.........................................................................................................33 Motivation:......................................................................................................................33 Perception:......................................................................................................................34 Learning:.........................................................................................................................34 Belief and attitudes:........................................................................................................34 Buying behavior:...................................................................................................................34 Need recognition:...............................................................................................................34 Information search:............................................................................................................34 Alternative evaluation:.......................................................................................................34 Purchase decision:.............................................................................................................35 Postpurchase behavior:......................................................................................................35 Consumers buying behavior for lux (why people buy lux):....................................................35 ments..................................................................................................................35 Affordability.......................................................................................................................36 Variety...............................................................................................................................36 The buying behavior of consumer for a new brand of lux......................................................37 Stages in adoption process................................................................................................37 Awareness:.....................................................................................................................37 Interest:..........................................................................................................................37 Evaluation:......................................................................................................................37 Trail:...............................................................................................................................37 Adoption:........................................................................................................................37 Business Buyer Behavior.......................................................................................................37 Environmental Factors.......................................................................................................39 4

Declare your beauty Organizational Factors.......................................................................................................39 Individual Factors...............................................................................................................39 Problem Recognition:......................................................................................................39 General Need Description:..............................................................................................40 Product Specification:.....................................................................................................40 Market segmentation of Lux..................................................................................................41 Geographic segmentation..................................................................................................41 Demographic segmentation...............................................................................................42 Psychographic....................................................................................................................42 Behavioral..........................................................................................................................42 Market segmentation of lux..................................................................................................43 Selecting target market segments.....................................................................................43 Differentiating and positioning...........................................................................................44 Competitive advantages.......................................................................................................44 Product or Service.................................................................................................................45 Imported LUX has vaster product line; they provide loads of variants............................47 Brand positioning of LUX in Pakistan.....................................................................................48 New Product Development / Product Life Cycle.....................................................................48 Internal and External Idea Sources....................................................................................50 PRICING UNDERSTANDING & CAPTURING CUSTOMER VALUE................................................52 PRICE.................................................................................................................................52 Factors setting the Price.................................................................................................53 ISSUSE...............................................................................................................................54 Pricing strategies..................................................................................................................55 Market Skimming...............................................................................................................55 Market Penetration Pricing.................................................................................................55 Product Mix Pricing Strategies...............................................................................................55 Pricing of Lux.....................................................................................................................55 5

Declare your beauty Price Changes....................................................................................................................56 Marketing Channels (Place)...................................................................................................56 Communicating Customer Value: Integrated Marketing Communications Strategy..............59 Impact of promotional mix on sales...................................................................................61 LUX Pakistan is effectively developing market communication.......................................61 Chapter 15: Advertising and Public Relations........................................................................61 Chapter 15: Advertising and Public Relations

STRATEGIC PLANNING OF LUX Strategic planning is concerned about the overall direction of business. It is concerned with marketing of course. The objective of strategic planning is to set the direction of a business and

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Declare your beauty create its shape so that the product and the services it provides meets the overall objectives of the business or company. Strategic planning is very important in business because it identifies the sources of the competitive advantage, it measure the resources needed to invest in and build the company and business, it sets the objectives of business and in the end it evaluate the performance and results. Companies usually developed long term plans to observe the company’s current business and how to keep them going but in contrast strategic plan involves adapting the firm to take advantage of opportunities in its constantly changing environment. Strategic planning includes the following steps:

First step of strategic planning is establishing mission statement. It defines the fundamental purpose of an organization. It is used to set out the picture of an organization in future. It provides details of what is done, why it is done & for what purpose it is done. Lux brand has also established its mission statement as it is one of the leading brand in the world. Lux mission statement is “Beauty begins with Lux” and Lux is following its mission statement very well. Lux is setting its goals and objectives on its mission statement and is launching its new variety of products in the market. LUX is the highest selling beauty soap in Pakistan. Though LUX is the highest selling beauty soap in Pakistan, it does not go for traditional mass marketing. Moreover beauty soap, LUX does not even segment and divide its market according to gender. Every person with normal or oily 7

Declare your beauty skin can use this soap. Unilever Pakistan Ltd. segments and divides their market according to geographical areas. The population of the country segmented into three parts which are urban, sub urban and rural area consumers.

The company further differentiate the geographical segments according to Socio Economic Cluster (SEC) i.e. education and Income. Lux mission is to keep its products prices in range of maximum people. LUX is not a highly expensive but an affordable product. That is why the company targets urban and sub urban upper middle and middle class people who are the second highest population of the country. Their target category is divided in to three segments A, B and C. Sec A is “Higher upper level”, sec B is “ Upper Middle level income and sec C is “Middle level income” because these three segments are assumed to be financially well off & they can afford to buy lux as well. Its objective is to develop new and unique products of beauty and care. In 1985 there were only soaps in only 5 colors but now Lux has launched its shower gel moisturizing bars, liquid soaps. Now lux is sold in 100 different countries and sales achieved 1.0 billion euros alone. Lux main goal & objective is their supply chain and distribution. Lux makes sure that products are accessible and are being supplied in market, no matter where consumers are in Pakistan. In this task Unilever helps them & make sure that these products are distributed to the consumers at correct time, with right cost and in accurate & proper quantities. The mission of Unilever Supply Chain is: provision of their products in low cost and price. They ensure the efficient provision of their products in market for this they develops simple and effective network of supply so that they can achieve high level of service & their main focus are retailers because retailers transfers & provide products to the consumers or in other words they are not wholesalers. Unilever adopt two channels & ways for the supply of their products that are conventional & vertical. In conventional marketing producers, retailers & wholesalers are independent and they are seeking to maximize their own profits because each business is separated, whereas in vertical marketing they wholesalers & retailers to supply products to the consumers. They work tly & are not having independent business. The lux brand used different sale promotion to increase their sales. They are offering 22-carot gold coins on 100 gms and 150 gms of packets of Lux. They are also offering different types of promotions like Consumer promotion by distributions of samples of new variants, coupons, free trials and demonstration at shopping malls, markets and point of purchase. Trade promotion 8

Declare your beauty Discounts and lucrative offers to the retailers via price offs advertising and display allowances and free merchandises. Business and sales force promotion conducting trade shows and conventions contests for sales representatives and speciality advertising. Lux business portfolio involves launching of new products with normal prices in market. FIRST LUX WAS PRODUCING ONLY SOAPS BUT NOW they are introducing new several products under the Lux brand at different price points. Their new entries are not only confined to a bar of soap. They are relooking at the brand architecture by launching Lux International Body Wash and more variants to Lux may follow. These new entries are establishing to increase their profits and their sales as well. The marketing strategy that LUX Soap uses is no different than 90% of the large corporations out there, Brand It and Slam It. They spend more time to come up with a catchy tag line, pretty & attractive packaging and high priced celebrity endorsements and then spend millions of dollars getting the brand out there on radio, TV, store ads etc. They spend a lot of money in publicizing their products. Expensive commercials & ads are made for publicizing their brand & products as well. Famous celebrities of Bollywood, Lollywood and Hollywood are working in commercials of Lux to create a positive image in minds of consumer and to make their brand famous and unique among other brands. The secret of Lux longevity has been its consistent evolution i.e. attractive changes in their products whether it is the soap color, packaging or new variants, the brand is focusing to keep its youthful image and to make it attention seeking among audience. For this purpose they are Extending the soap cake to a range of shower gels, liquid soaps and moisturizing bars &this extension & revolution has helped the brand keep consumers excited and the competition at bay. The best thing about Lux is its commercials. Casting famous models and actors in their commercials is one of the best strategies of lux. The message in their commercials are If it’s good enough for a film star, then it’s good for you too to Play with beauty— and they are conveying this message over the years. MARKETING STARTEGY AND MARKETING MIX OF LUX MARKETING STRATEGY

LUX creates customer value and achieve profitable customer relationships by spending millions of dollars on the promotion, there is no second thought on the fact that lux has reached its

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Declare your beauty maturity stage on the product life cycle. Therefore UNILEVER has no problems in the mass promoting of the product. Lux has no different or unique marketing strategy, which means that they use very catchy tag lines, high priced celebrity endorsements, beautiful packaging and as mentioned before they spend millions on getting there product on radio, TV, stores etc. MARKET SEGMENTATION

LUX’s market segmentation is based on the geographic locations which are urban, sub-urban and rural area. On the other hand these segments are divided into SEC (socio Economic Cluster) i.e. education and income. SEC divides the population into five sectors starting from A to E, A refers to the highly educated and high income holders and E refers to the lowest income holders and is least qualified.

MARKET TARGETING

Unilever conducted a research that revealed that urban population are likely to buy expensive and imported products, and on the other hand in rural areas they buy cheap products without evaluating its quality but urban and sub urban areas the middle class people tend to buy affordable and quality products. LUX now tries to target that market because it is the second largest chunk of the population. Lux is not that expensive because it targets the middle and upper middle class. According to SEC LUX targets A B and C because they assumed to be well-off financially and can afford buying LUX. POSITIONING

Unilever has obtained a very good position in the minds of the buyers, this image has been ed on to its products through amazing price, quality and attributes, actually offering the product in a way different way than the competitors do. LUX has 43% of the market share in the beauty soap industry and in the beauty soap industry all products are of the same price so the company can’t afford to lower the price furthermore but it is in great position in the minds of its

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Declare your beauty consumers because of its packaging, fragrances and product design. In comparison with its competitors lux provides the best quality. THE MARKETING MIX PRODUCT

LUX is offered in six flavors which are LUX Energizing, LUX golden glow, LUX nature pure, LUX orchid touch, LUX almond delight and LUX aqua sparkle, and in three different size 40gm, 80gm and 120gm. LUX comes in three different types LUX the beauty soap, LUX the liquid soap and LUX shower gel. The formula is provided by the R&D department in foreign countries. Its raw material is imported which include sodium soap, glycerol and different extracts according to the flavors.

PRICE

LUX provides with the best pricing with the quality it provides, and the major reason behind it is that there are many competitors in the market and a slight change in the price comes up with a huge risk of creating a price war among the rivals which would result to low profits or the consumer shift towards other products. It is almost equal to its competitor. PLACE

Unilever ltd has a huge distribution channel almost all around the globe. In Pakistan its sales are more than 10 million pieces a year. The main factory or warehouse is in Karachi. The company itself doesn’t have any transport system so it hires different distributers to provide retailers with its products. It is sold in almost all cities in Pakistan, but it differs according to the nature of the shop it’s on e.g. there are supermarkets then there are kiryana stores and then there is khokas. The lux is sold on three of these but the hand soap and shower gel are only sold at supermarkets because the type of consumer which comes at these stores.

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Declare your beauty PROMOTION

LUX is known for its promotional activities. It spends 25% of sales revenue on the promotion. It endorses its products form the biggest stars of that particular country. For example in India lux is endorsed by Katrina Kaif and in Pakistan Reema, Meera and Amna Haq. The seriousness they pay on the promotion can be judged by this amazing figure that lux endorses with 400 stunning women in the world. Although promotion in Pakistan is difficult because to show international models you have to deal with private channels, and this is because on PTV or other government owned channels you can only show local models. So there ads in which Katrina or other beautiful women on which spend millions cannot be showed on the national television of Pakistan.

MANAGING THE MARKETING EFFORT

Unilever needs no introduction. It is one of the biggest multinational consumer products manufacturing organization which is currently working all around the globe. Unilever Pakistan is the Pakistan chapter of Unilever, where the company holds 60.75% share whereas the Government of Peoples Republic of Pakistan holds 39.25% share. LUX is the most famous product of unilever, and its ruling Pakistan by occupying approximately 50% of total market share among few major soap producers. Other competing brands like Tibet, Capri and Pears have started to have a strong consumer base, but LUX.’s product features distribution and promotional activities have created high brand loyalty for which it is still the market leader. MARKETING ANALYSIS SWOT ANALYSIS

A tool that identifies the strengths, weaknesses, opportunities and threats of an organization, specifically, SWOT is a basic, straightforward model that assesses what an organization can and cannot do as well as its potential opportunities and threats. The method of SWOT analysis is to take the information from an environmental analysis and separate it into internal (strengths and 12

Declare your beauty weaknesses) and external issues (opportunities and threats). Once this is completed, SWOT analysis determines what may assist the firm in accomplishing its objectives, and what obstacles must be overcome or minimized to achieve desired results. (http://www.investopedia.com, 2011) SWOT ANAYLSIS OF LUX UNILEVER PAKISTAN STRENGTHS •

Unilever is a big multinational company.

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Sound and experienced management

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Excellent marketing department assisted by a highly regarded marketing research unit.

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R&D and financial from parent company i.e. lever brothers.

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Management of product is familiar with the psychographics and demographic of the consumers.

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Strong brand image and brand awareness of “LUX”.

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Market leader as it has a 43% share.

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Large sales force.

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Strong and healthy relationships with distributors and retailers.

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Strong Market Research

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Many variants (Aqua Sparkle, Crystal Shine, peach & Cream etc.)

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Positioning focuses on the attractive beauty segment

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Dynamically continuous innovation of the product and developing new variants (Magical Beauty Purple)

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Innovative promotions (Sonay k sikay--gold coins in Lux bars’)

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Unique advantage of having access to resources and assets from unilever Pakistan limited

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Weakness

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Lux is mainly positioned as beauty soap targeted towards women, hence it lacks unisex appeal

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Some variants like the sunscreen was a flop

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Low market share in N.W.F.P.

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Loss of market share to some of its own products as Rexona.

OPPORTUNITIES •

High rate of population growth. 13

Declare your beauty •

Rising literacy

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Market opportunity for “LUX” to penetrate in the new segments and market by the style and beauty consciousness of the people mainly due to Pakistani media.

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Soap industry is growing rapidly in Pakistan

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More promotions like price-offs and samples

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Line extension – probably with more variants catering to the beauty segment like natural, herbal soap etc.

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Liquid body wash is currently in the growth stage – Lux should come out with more variants in this segment

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Level of servicing is high during sales promotion schemes

THREATS •

Possible increase of market share of Capri and Rexona.

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Rising inflation, which reduces personal disposable income of consumers?

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Profit margin is exposed to rupee devaluation.

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High internal competition – Pears also catering the beauty segment

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Dove, a major threat from unilever

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Excessive dependence on beauty segment makes Lux vulnerable to changing customer tastes

MARKETING PLANNING

Unilever Pakistan is providing LUX at a price which is affordable to almost everyone. Beauty soap is an uprising phenomenon in Pakistan due to beauty consciousness development in both, males and females in Pakistan’s population. As a multinational company Unilever Pakistan with heavy promotional activities, has been able to penetrate the market. With six different fragrances, 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 its marketing activities LUX has been a successful brand. The only place where rival companies are progressing is in giving customers redemption offers. Research revealed that Pakistani customers are highly attracted to this sort of offers. These offers are not sustainable. CURRENT SITUATION 14

Declare your beauty LUX is not a highly expensive but an affordable product. That is why the company targets urban and sub urban upper middle and middle class people who are the second highest population of segment of the country. Moreover Unilever Pakistan Ltd obtained a good position in the buyers’ mind through better product attributes, price and quality, offering the product in a different way than the competitors do. The company offers improved quality of products in the industry at an affordable price with high branding, which ultimately helps to position the product in the buyers’ mind as the best quality beauty soap. Unilever Pakistan Ltd is operating in the industry with its world famous brand LUX. Out of these giant companies Unilever Pakistan Ltd is the market leader with a share of around 43%.The other competitors are very competitive among themselves but they cannot put an intense competition with Unilever Pakistan Ltd, as they have market share much less than Unilever Pakistan Ltd. Currently LUX’s distribution process is highly efficient and its availability helps attracting a huge number of customers. Overall with its marketing activities LUX has been a successful brand.

OBJECTIVES AND VISION

“Increasing inflation continued smuggling of tea; poor security conditions and power outages pose significant challenges to the business. Bigger innovations, improved execution and a high performance culture give us the confidence that we are capable of continuing to deliver exceptional value to consumers, customers and shareholders.” (www.Unliver.pk) MARKETING STRATEGY

Key points of lux’s marketing strategy are Effective segmentation, perfect positioning, variety and diversification in product, Promotional strategies and schemes, public relations, capturing customer loyalty, pricing and placing strategies: ACTION PROGRAMS

It’s certain annual promotional campaigns like LUX Superstar and LUX Annual Style Awards has made the product a part of the glamour world. Since the 1930s, over 400 of the world’s most stunning and sensuous women have been proudly associated with Lux ments. They 15

Declare your beauty keep prices are almost equal to its competitor. Company carries out research on competitors’ price and brand loyalty when it feels extreme necessity of changing price MARKETING CONTROLS

LUX recorded double digit growth largely led by volume. The brand gained market share based on an improved product and a more effective campaign. (Unilever Pakistan annual report 2010) Home and personal care segment of unilever Pakistan grew by 23% as a result of enhanced consumer and customer value. Surf continues to consolidate its position as a market leader. Lux, Rin, Fair & Lovely and Ponds delivered robust volume growth backed by strong advertising campaigns. (Unilever financial report march 31st, 2011). Lux process modification – project SWING (Soap with Inclusion of Glycerin), simplifying soap manufacturing process resulting in energy saving and reduction of waste and water consumption. (Unilever Pakistan annual report 2010)

MEASURING AND MANAGING RETURNS ON MARKETING INVESTMENTS

Return on marketing investment (ROMI) is the contribution attributable to marketing (net of marketing spending), divided by the marketing “invested” or risked. Marketing is, and always will be, a creative endeavor. But it can also be a highly rigorous discipline. In case of LUX, that is a brand of Unilever Pakistan, is investing millions of rupees inside Pakistan to promote and sell their brand to the minds of people. They have chosen top actresses and models for their brand endorsements that is a game of money in which they have invested with no bounds. Other than this, LUX is the only brand that plays globally its ments along the locally made one. LUX has to invest in private channel medium to show their every type of ments whereas they have to invest separately on the government owned channels to play their local ments. Recently LUX has started promoting its other products in same line also, the liquid soap and the shower gels. It is very clear that if LUX is investing heavily in their marketing and promotion to compete and stay up to a level, they are getting the returns in same pattern. LUX has achieved a status in every market that it’s the soap only; other soaps are not worth it. Investing in a global 16

Declare your beauty style has impacted the sales of LUX beauty soaps. This scenario is only with beauty soaps; LUX is promoting its brand name and beauty soaps heavily but recently they have started investing towards their other products, campaigns are running heavily at all available channels where product can be promoted. LUX has invested with an objective to promise their customers, that LUX will never be less than their expectations; it will provide them the best. LUX maintains a relation with their customer by taking care of their skins, attract its customer by branding the points of sale like all targeted stores and selling points, by introducing new colors and fragrances, by sponsoring a mega event, LUX has invested a lot but maintained its position in the minds of all women in Pakistan. In covering the customer life time equity and value provision, Unilever takes responsibility as a whole, every product of Unilever provides its customer to interact with them through their “Raabta” service, they provide them the best customer service and even advisory sessions. So we can say that LUX is investing a lot and gaining a lot too.

UNILEVER’S MICRO-ENVIRONMENT THE COMPANY

Unilever is one of the largest manufacturers of a wide variety of consumer products and operating around the globe. In Pakistan it is operating in a number of brands like food brands, home care brands and personal care brands. Lux is one of their most famous brands in personal care products. It is the mantra of Lux to deliver status inspired beauty products, whose delivery will be made accessible to everyone, so they could indulge everyone’s senses to make their skin and hair look and feel more appealing and gorgeous and also inspire you to feel the pleasure of expressing the beauty. The need that unilever felt was that we all have desire to get pampered, to look and feel great and to enjoy the moment of feeling something that is possible. Lux was launched in Pakistan in 1954, got the image of a soap that is for stars. The main target of LUX was females of Pakistan, so a perception was positioned to its customers that if they use LUX they’ll become glamorous. Unilever is a global company; the chapter operating in Pakistan is allowed fully to develop the strategies according to the regional requirements. All departments collaborate to introduce their 17

Declare your beauty marketing strategies like the task of R&D is to provide the latest research by conducting surveys and different researches to get the and find latest attractions that people are demanding to get. It’s the operation of R&D to acquire the knowledge about the needs of females, in summers their skin get oily and is more open to dust and sunlight, so R&D would research that what could females that can confirm them that their skin would become oil and dust free after using one of the LUX and its will reduce the reaction of sunlight on their skin, to choose the colors of the physical LUX that would go in their customers hands. Then marketing department take its tasks as the promotion and placement of the product whereas the supply chain management department takes the responsibility of the suppliers and the availability of the LUX. Both these departments are controlled by the Brand management department in which a trade controls manager who checks the availability of the LUX and also the quantity to each point of sale.

MARKETING INTERMEDIARIES

A large number of units are involved in the processing of LUX products, from its packaging to the final buy through the customer. Unilever has many units and departments that are collaborated with each other to help them in promoting, selling and even distributing its products. Unilever possesses very efficient system of distribution that never leads to the shortage of any product. It is the in house responsibility given to the brand department to regulate the quantity of the LUX products to every outlet. The distribution of LUX is done by dividing the distribution of Pakistan in three channels, Central zone, South and North channels. Unilever designed a centralized Intensive distribution system. In this type of distribution, LUX is supplied to those resellers where majority would stock the products of LUX along the convenience products, like those who are leader in the market. In this type of distribution, LUX is made visible at perfect spots but the differentiation among the competitor products is on the basis of price. Another strategy used by Unilever in delivering the product to the market and dealing with logistics is Cross Docking. In this strategy, logistics of unloading materials from an incoming semi-trailer truck or railroad car and loading these materials directly into outbound trucks, trailers, or rail cars, with little or no storage in between. This may be done to change type of 18

Declare your beauty conveyance, to sort material intended for different destinations, or to combine material from different origins into transport vehicles (or containers) with the same, or similar destination. There are some benefits and some disadvantages of using such logistic system: ADVANTAGES OF RETAIL CROSS-DOCKING •

Streamlines the supply chain from point of origin to point of sale

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Reduces handling costs, operating costs, and the storage of inventory

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Products get to the distributor and consequently to the customer faster

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Reduces, or eliminates warehousing costs

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May increase available retail sales space.

DISADVANTAGES OF CROSS-DOCKING •

Potential partners don't have necessary storage-capacities

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An adequate transport fleet to operate Cross-Docking

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Need of adequate IT-System

All these strategies are required by Unilever as they had to prove their corporate commitment to promote the distribution and supplying process improvement globally. Originally in Pakistan there are 2 warehouses of Unilever, more than 4500 distributors are working with Unilever to supply LUX in selected areas and whole sellers. According to a recent survey, LUX is covering only 65% of its consumers. LUX brand of Unilever is involved in three channels of distribution: •

CNC (Cash and Carry) Distributors;

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IMT (International Modern Trade like Makro and Metro);

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LMT (Local Modern Trade) the general trade at shops.

Trade control manager assigns the distribution department to send SKUs of LUX directly to the distributors, also assigns the sales department to make sales contracts with different parties existing in market and supply LUX by advising distribution I Rahim Yar Khan Factory, which is the main depot and sales plans are also sent here, where as all major cities like Faisalabad, Lahore, Multan, Karachi, D I khan and even Wazirabad have their own depots where the product is supplied from central depot of Rahim Yar khan. COMPETITORS

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Declare your beauty LUX is a brand of Unilever, so it has two types of competitors; •

Internal Competitors

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External Competitors

INTERNAL COMPETITORS

Lux is manufactured by a company that has a wide variety of products in same line of beauty soaps. Currently Unilever is producing three other beauty soaps that are in competition with LUX. These soaps are Dove, Rexona and Lifebuoy. Lux has to maintain its pricing strategy to compete with these brands. Lifebuoy and Rexona are the major competitors in case of pricing as Lifebuoy is even cheaper than LUX and is of nearest in quality to LUX, so LUX has to apply a very sensitive strategy in which it could be sold more as compared to internal competitors. Whereas in case of quality LUX has to face a serious competition with Dove products as they are providing a better quality and has maintained a better prestige in market, so LUX has increased the prices on such a stake that it could beat Lifebuoy and Rexona but could not take up to as Dove has, so people mostly from all classes prefer LUX due to its quality in satisfactory price. LUX has also similar products in different categories like liquid soap and shower gels. Similarly the liquid soap has only one competitor internally, Lifebuoy that is a cheaper brand in liquid soaps also and is leading the market as compared to LUX due to its price and refilling options available. Shower gel of LUX has no internal competitor. EXTERNAL COMPETITORS

Beside the internal competitors, LUX has to maintain competition with external competitors. A large number of beauty soaps exist in markets that give true competition to LUX like Tibet, Camay, Hoor and Palmolive. LUX has to look after its pricing strategies, but still LUX is still leading the market due its attractive packaging, as other soaps are using simple color schemes or not so much attractive as LUX is doing, LUX has become a brand that is advised by worlds most beautiful women but not any other competitor brand is able to come up to this level. As discussed above, LUX has also similar products in different categories, and is facing a bad competition externally in case of liquid soaps and shower gels. LUX liquid soap is in competition with many other brands like Fa, Palmolive, Dettol, Breeze, Pears, etc. These all brands are giving tough competition and LUX is not able to compete with them, well due to less publicity of its items. Similarly in case of shower gels its facing dense competition in the market 20

Declare your beauty as other international brands are competing it in same price such as Fa, Palmolive, Neutrogena, body shop gel, etc. LUX is also not able to compete in this category due to less promotion and pricing strategy applied on them. PUBLICS

Unilever has all seven types of publics but the visible ones are only Government, Media, Citizenaction and General Publics. We are aware of the issues that are faced by LUX by the platform of government in case of ments, as LUX is unable to play its all international ments on national television and all channels that are on air from its domain due to certain implications applied by PEMRA. In the promotion of brands like LUX, media publics play an important role. LUX is known by women, not by its use but by the models that come and show LUX as their own soap. In media publics; all channels that are on air, social media like Facebook & Twitter, newspapers, magazines, etc. play the most important role in promoting and creating a perception in the minds of people. LUX utilizes this strategy globally in a same pattern to promote its brand to target audience. It is also created a grand perception on the mind of socially stable people by sponsoring a mega event of showbiz by the name of LUX Style Award Show. Sponsoring this event has made LUX successful in achieving its image that it’s the brand that is used by models and actresses, looking this when cheaper price is available, maximum females would try this product due to its promotion and image. CUSTOMERS

LUX targets a variety of audience, with its attractive promotions and ments. Basically, LUX is a brand of women, targeting the women who have desire to look beautiful, want to look like the models who have been promoting LUX as their personal brand. LUX has been successful to target and capture the market of customers of every type. This is only in the case of beauty soap, whether it’s imported one or the locally manufactured one, but in the case of Liquid soap and shower gel, it’s not successful fully. Lux is unable to capture the market that utilizes shower gels, as there are so much products varying in prices and leading in Brands, which is an issue for LUX Unilever.

MARKETING RESEARCH

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Declare your beauty Marketing research is the systematic design, collection, analysis and reporting, marketing research starts with the first step of Defining the problem which is the most important stage: We will be conducting the marketing research of Lux starting with the first stage of defining the problem Two Lux soaps, located on one shelf of retail outlet, one imported and other is local, isn’t it deviating the customer? ISSUE The problem is the difference between quality of local and imported one, which can unconditionally create customers deviation. Discussing the design of Lux, packaging, price and quality are main differentiating factors. Lux bar soap is similar to Ivory in its pure white color, lux has a clunky square shape, it is dense plus brittle just like Ivory and its smell is also like Ivory. These all things are same for both local and international Lux. This can’t be changed as Lux has to maintain these things under some regulations that are maintained and supervised by the global Unilever chapter. Moving towards the quality, there’s a huge difference between the qualities, as Pakistan chapter of Unilever is producing Lux in its own way to maintain its cost up to a certain level so it can target a large number of consumers, whereas imported Lux is mostly an import from China or Dubai. These countries like China, Dubai, India, etc. have their own chapters of Unilever and their manufacturing recipes and their manufacturing companies are also different, that maintains its shapes but differs on everything which always creates deviation for the customer of Lux Pakistan. The main issue is that quality is different in sense that Lux manufactured by India, Dubai and China is of good quality whereas the one that is locally produced is of low quality. A customer that desires to buy Lux, who is attracted by its endorsement and ment, now coming to purchase, customer is deflected to buy which one, if the customer is not aware of the quality and is first time of Lux, then he would be buying on the basis of on the spot attraction, like packaging and price. Whereas if the customer is existing , then he would definitely buy imported one due to good and better quality. Even then it is not sure that he would buy imported Lux or not, as on the basis of price and packaging, the imported Lux would have its own competitors. Lux is bringing glamour into the world. Lux is provoking consumer by the senses sight, smell and touch like never before but on the other hand if there will be such a difference in the

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Declare your beauty quality then people will switch to imported lux no one will ask for the local lux .international lux has so many types people don’t even know about those types like: Lux Beauty Soap brand new Packing/style, new Size variants White glamour, Velvet Touch. CLV LUX fragrance soap, having high foam and awesome smell. Its basic feature is of cleansing plus whitening. Lux whitening soap is available in different colors like pink, yellow, and green and purple. All these soaps are not manufactured in Pakistan they are imported from other countries but not in a huge quantity. If all these types are manufactured her with an affordable price and in a good quality then customers will get the same quality soap from their very own country plus there will be no need of importing these soaps. LUX and its various products are manufactured in 71 different locations with more than 2000 suppliers. The key markets of lux are in Pakistan, Brazil, USA, China, Bangladesh and South Africa, and are a market leader in India (for soap bars), Brazil, Saudi Arabia (for soap bars), Bangladesh and Thailand. Pakistan is the key market of lux soap but still the soaps manufactured in Indian, Saudi, and Brazil is better than local soap most of the lux soap is imported from India. Though Unilever checks out the product quality in all the countries it is produced in. Lux products are gentle and these products are non-irritating for normal skin. Unilever Corporation conducts all the product safety regulations in each country where Lux soaps are sold. According to Unilever Corporation, they apply high standards checked before bringing a product to market. Unilever also has a Safety and Environmental Assurance Center that ensures safety of the environment, people and production. Lux soap is formulated for use with children under the age of 3, the elderly and other vulnerable of the population. Of Corse there is a price difference in all the lux like the local lux is selling in cheaper price as compared with the imported lux. Lux soap is an affordable bar soap, when first introduced in the United States in early 190,s, it had an affordable option to expensive French Milled soaps. Lux is also sold in China at an affordable price for consumers not only in china and United States lux all around the world has a nice affordable price so the pricing factor of lux is stable, but the quality difference should be eliminated so there should be minimum customer’s deviation. Observational research can really help in overcoming the defined problem. Maximum people want the quality of lux to be improved

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Declare your beauty LUX is the name of beauty and it is the enigma of a woman. Since its launch in Pakistan in 1954, it is known as the 'soap of the stars' capturing the imagination of the target audience with the allure of Pakistan's leading glamorous ladies. It’s all about the brand lux is offering or introducing new products and expanding its soap range day by day but talking about Pakistan the quality isn’t that good as compared to the imported lux (lux produced internationally).if Unilever keeps check at the quality of the local lux and compares the ingredients and other things used in the production of local lux with international standard then this problem can easily be sorted

In the marketing research stage after defining the problem ,conducting research on that we have other two stages which is implementing the plan the plan to sort out the problem to minimize the deviation of consumer.so in this stage the plan should brought in to serious action now the researchers must also process and analyze the collected data to isolate important information and findings the solution to this problem is mentioned above then finally marketing research deals with its last stage/step which is of interpreting and reporting the findings now this research should draw some conclusions and report them conclusion. So solving the above mentioned problem all depends on the Unilever corporate who can keep a check on the quality and the research department the quality of lux in ever country should match with each other their shouldn’t be any difference only in this the deviation can be minimized.

ANALYZING AND USING MARKETING INFORMATION CONSUMER VIEW ON LUX (BOTH IMPORTED AND LOCAL) Q: WHAT IF ONLY LOCAL LUX IS THERE IN MARKET? HOW CONSUMER CHOOSES BETWEEN OTHER IMPORTED SOAPS AND LOCAL LUX? LUX has created its brand image and no matter what most of the consumer uses LUX as their daily skin care soap. According to retailers 60% of customers tend to buy local LUX as compared with other imported soaps. 45% of consumer says that “they choose imported LUX over other imported soaps.” Based on the above analyzed information from retailers, we can assume that local Lux sales are been competed by its imported image at a good scale and even then Unilever is unaware of the issue.

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Declare your beauty GENERAL MINDSET OF CONSUMER: IMPORTED LUX IS BETTER THAN THE LOCAL ONE, MYTH OF LOCAL LUX (NO QUALITY AND POOR RESULTS) Consumer often thinks that local product lacks quality and effectiveness. As far as LUX is concerned 75% customer thinks that local LUX is not as effective as the imported ones, but sales are only effective of local Lux due to its price factor. In Pakistan there is always a cheap way of producing goods and consumer even suspects a multination company like Unilever for using wrong ways of producing soap. Another fact, which creates deviation for a customer of local Lux, is their biasness towards Pakistan actresses and model. A class of Pakistan will never go for a soap which is endorsed by Meera; however they still prefer LUX on other soaps. Therefore customers go for imported LUX. 90% of customer thinks that imported LUX will give better results because more technology is used in imported LUX as compared to local ones. They also think that imported LUX is expensive so it will be better than the local LUX. Media is one of the biggest and most effective ways of creating brand imaging and LUX is using this tool for many years for creating its brand image and marketing position. This marketing promotion tool has gained lots of benefits and loyal customer to LUX. However Pakistani people tend to watch Indian and foreign channels these days and they get attracted to imported LUX d on those channels. . So when these customers go to buy LUX they switch to imported LUX because of their ment. Pakistani customers are overwhelmed by using a soap having Ashwariya Rai and Katrina Kaif picture on its pack. UNBIASED CONSUMERS PREFER LUX ONLY; DON’T LOOK OVER WHETHER LUX IS IMPORTED OR LOCAL ONE Only 20% customers prefer LUX on other soaps because they trust Unilever and have a mind that both LUX whatever local or imported have same qualities and same LUX. . Just packaging and variants are different. More than 35% of customers do not check the manufacturer of LUX they just buy LUX for its brand imaging and promising results. LUX is an international brand and it cannot provide poor quality in local.

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Declare your beauty However Unilever Pakistan can make more profit in these economic crises if they start to promote local LUX more and ensure its quality as compared to imported LUX. There are no efforts of convincing customers to buy local LUX by retailers and Unilever itself. Unilever should remove the doubts of its customers they have for local LUX. . In this way the will get more results. On the other hand Pakistani models and actresses should be hired for international branding

LOSS OF UNILEVER: IMPORTED LUX WORKING AGAINST THE LOCAL ONE According to the views of several retailers, in Pakistan Lux that I manufactured locally owns the 50% of market whereas the imported one owns an equal share in market. In Punjab zone there are proper channels of distribution of imported Lux products that are supplied to retail outlets and are sold more than Local ones. In short the imported image of Lux is taking over its local one very easily. LUX CRM (CUSTOMER RELATIONSHIP MANAGEMENT) How Unilever marketing strategies are based on consumer insights and information: One of the biggest strategies Unilever uses is to hire actors and actress for LUX because market research showed that people had some sort of attraction for goods d by the stars. It’s some sort of visual mapping and product positioning strategy when makes consumer to use LUX more than other soaps and increase its market share. “The brand has always hired celebrities when they have reached a certain height rather than using them at the start of their careers. This avoids the issue of celebrities overshadowing the brand,” says Angelo Dias, national creative director. In Pakistan LUX has showed Babra Sharif, Reema Khan, Iraj Batool, Iman Ali, Meera, and Vaneeza Ahmed & Amina Haq as role models in LUX. Now they have Reema Khan, Meera, Humaima Malik and Mahira Khan in their new ment. Due to these strategies LUX got approximately 43% of total market share among few major soap producers. Moreover, Unilever gets to know that almost everyone uses internet and Facebook these days so they use Facebook as their promotional scheme. They get this insight from the customer that 26

Declare your beauty ment is not working on then because watching TV has become less than ever. Being smart Unilever not only uses Facebook for promotional scheme but also to gain consumer insight. It’s an innovative project of Unilever that uses social networking and the s’ data for getting engaged with customers, to get their insights as well. This new project will broaden Unilever’s understanding of its consumers when it comes to LUX and It will enables them to do more instead of using same old promotional schemes. Whatever consumer wants is provided by Unilever LUX, consumer seeks high quality and it’s provided by LUX. Variety is needed by customers and Unilever provides lots of variants in LUX soaps (Sparkle, Crystal Shine, peach & Cream etc.). It’s a customer want to get more in same product line so that is why Unilever introduced LUX body wash and hand wash.

LUX: MODEL OF CONSUMER BEHAVIOR Consumer behavior tells us when, where & why consumer buys & do not buys the products. Consumer behavior tells us the buying decision process of both individual & in groups. This term tells us the buying behavior process from the first step that why an individual purchases this product to the final step of experiencing the final purchase product. Buying behavior of buyers depends on the nature of the buyer, on the product and on the buying situation. The consumer behavior model is known as black box. Because we do not what is in mind of human beings & what runs in the minds of consumers & buyers .Therefore it is named as “black box”. And therefore a marketer spends lot of time & money to find out what consumers tick. Product, price, place & promotion are the most important 4Ps of marketing stimuli. Lux is the most famous brand for beauty soaps and almost everyone is aware of this brand in Pakistan. LUX is the highest selling beauty soap in Pakistan. Though LUX is the highest selling beauty soap in Pakistan, it does not go for traditional mass marketing, moreover as a beauty soap LUX does not even segment and divide its market according to gender. Every person with normal or oily skin can use this soap. But the problem in lux brand is that lux is displaying two types of soaps i.e. local & imported. Means lux is creating differentiation in its own products. The level of lux products are not the same. There is also a difference of price between local and imported lux due to difference in their qualities and consumer pays different prices for lux soaps, according to their preferences. The difference in their prices is due to the quality of products that are used in the production of local & imported lux. Place involves the easy availability of its products to its consumers. It involves convenience. Lux products are easily available in markets 27

Declare your beauty whether they are local or imported. In fact local soaps are more easily available even in local and small shops & markets. Promotion factor involves communication. Lux is promoting its product through media, internet, billboards, and commercials, adds etc. They give more importance & spend more money on the promotion of their imported products & soaps.

The other environmental factors in consumer model are cultural economic, technological & social factors. A cultural factor involves awareness of marketer from society. Every organization should launch their products according to the taste & choices of the people living in that particular area. Even commercials & ads should be made according to taste & culture of that particular society. If the organization fails in doing so then it can face a heavy loss. Social factor involves social class & personal life style. Lux should launch its one quality soap rather than launching local & imported soaps. This creates confusion among the consumers that which soap is better for their skin & which is not good for their skin. They should launch the same quality soaps with same price; this will not only increase their sales but also remove confusion from the minds of consumers that which one is better for their skin. Economic factor is the most important factor of any organization. The difference in the prices of the local & imported soap results in difference in prices. Due to more prices of imported lux many people will switch to local lux .Who can afford imported lux they will also switch to local lux to save their money. This will affect the economy of lux. Technology involves usage of special techniques in order to work their organization in a better way. Lux has adopted many strategies to make their brand one of the best brands of soaps. It’s the brand or organization duty to attract the buyers and persuade them to purchase their products .The brand should use different techniques for this purpose & developed different marketing strategies. The marketing strategy of Lux brand is no different than 90% of the large corporations out there, Brand It and Slam It. They spend more time to come up with a pretty & attractive packaging and high priced celebrity commercials and then they spend millions of dollars for publicizing their brands products on TV, newspapers, radio, billboards etc. Lux brand is spending large amount of money for their expensive commercials & ads. Famous celebrities of Bollywood, Lollywood and Hollywood are working in commercials of Lux to create a positive image in minds of consumer and to make their brand famous and unique among other brands. 28

Declare your beauty But they are promoting their expensive & imported products due to which their local products are getting ignored. Local soaps of lux are lux is usually placed on the hidden shelves & most of the people are not aware of lux local products. There is a need to publicize their local products as well for their promotion in public. If the marketer wants to understand how the stimuli are changed in to responses inside the consumers black box it depends on two parts which are firstly the buyer characteristics how the consumer perceives & reacts to the stimuli. Secondly the buyer decision process itself affects the buyer’s behavior. Whereas the secret of Lux endurance is its consistent & continuous evolution i.e. attractive changes in their products whether it is the soap color, packaging or new variants, the brand is focusing to keep its youthful image and to make it attention seeking among audience. For this purpose they are Extending the soap cake to a range of shower gels, liquid soaps and moisturizing bars &this extension & revolution has helped the brand keep consumers excited and the competition at bay. The best thing about Lux is its commercials. Casting famous models and actors in their commercials is one of the best strategies of lux. The message in their commercials are If it’s good enough for a film star, then it’s good for you too to Play with beauty and they are conveying this message over the years.

CHARACTERISTICS AFFECTING CONSUMER BEHAVIOR

CULTURAL FACTORS Cultural factors that influence or affect the consumer behavior are: CULTURE: Refers to the set of basic values, perceptions, wants and behaviors learned by a member of society from family and other important institutions. In case of beauty soaps, the Pakistani culture doesn’t the scenario because of poverty, people have less concerned about health and beauty, but lux targets the higher and middle class which is quite conscious about their beauty. There are two types of lux available in the market one is local and the other is imported, there is price and quality difference which targets the both the upper and middle class. The culture of Pakistan in the upper and middle class is very influenced by these types of beauty products. SUBCULTURE:

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Declare your beauty A group of people with shared value systems based on common life experiences and situations. It includes nationalities, religions, racial groups and geographic regions, although lux doesn’t segment or target consumers by their subculture neither lux’s demand gets affected by these factors. SOCIAL CLASS:

Group of permanent and ordered divisions in a society whose share similar values, interests, and behavior. It is not determined by only a single factor such as Income group, it includes occupation, and education. High and medium income groups are targeted, in the occupations it doesn’t specify or target any but people on high posts are included and at last but not the least people with education buy these beauty products, or lux targets them buy persuasive and informational advertising. SOCIAL FACTORS

Social factors that influence consumer behavior includes: GROUPS AND SOCIAL NETWORKS:

Groups are people who interact to accomplish individuals or mutual goals whereas the social class represents the divisions in a society whose share similar values, interests, and behaviors. These also include reference groups, people are often are influenced by reference group to which they do not belong. For example a young cricket player hopes to become Wasim Akram someday, or refer to him. In lux’s case they on television showing international actresses because its beauty soap and women refer to those actresses. ONLINE SOCIAL NETWORKS:

Online social networks include blogs, social networking Web sites, or even virtual worlds, where people socialize or exchange information and opinions. Lux has no individual website but UNILEVER has created a page for it on their official website, there are pages made on all social websites such as Facebook, twitter, MySpace, and tweeter. They promote their product by advertising it and publishing promotional campaigns. FAMILY:

Family can strongly influence buyer behavior. In Pakistan the most important factor that affects the buying behavior, this is because Pakistani people are very family oriented. They respect their family values and are eager to follow them. Mostly the ladies do the shopping for the household and they have strong of her elders on what to buy and what not to. Lux targets females and the scenario they create of a fine beauty soap targets all ages.

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Declare your beauty ROLES AND STATUS:

People choose products which are appropriate to their roles and status. Lux targets the upper and middle class, it isn’t a status symbol though but through massive advertising they do create a wow in the minds of consumers. In Pakistan there are 2 types of lux available local and imported. It can be said that the imported lux is a status symbol because of its price compared to the local lux and other beauty soaps.

PERSONAL FACTORS:

A buyers decision also are influenced by personal characteristics such as the buyer’s age and life cycle stage, occupation, economic situation, lifestyle, and personality and self-concept. AGE AND LIFE CYCLE:

Age and cycle refers to the segment of life the consumer is in. As we know lux is beauty soap, females from all age segments will use lux. As they get conscious about their beauty lux starts targeting them by bombing them with advertising. ECONOMIC SITUATION:

The financial situation of the consumer also affects the buying behavior. Lux targets upper and middle class so people from these two sectors buy lux. People with bad economic or financial situation wouldn’t buy a lux because it would be very expensive as its price is above Rs. 60 per piece. LIFESTYLE:

A person’s pattern of living as expressed in his activities, interests, and opinions. Lifestyle also has a very important impact on the buying behavior because if the person hasn’t got the lifestyle, for example if the consumer isn’t conscious about his beauty and doesn’t have any interest of his or her beauty, he or she wouldn’t be attracted to the product and that is lux also uses informational advertising to inform them about the fact the it is necessary to take care of your skin. PSYCHOLOGICAL FACTORS:

The buying behavior is further affected by psychological factors such as motivation, perception, learning, and beliefs and attitudes.

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Declare your beauty MOTIVATION:

A need that sufficiently enforcing, to direct the person, to seek satisfaction of the need. Lux motivates its consumer’s buy marketing and advertising on almost all mediums possible. It creates a sense in the mind of the consumer that it’s a need instead of want.

PERCEPTION:

The processes by which people select, organize, and interpret information to a form a meaningful picture of the word.

LEARNING:

The changes in an individual’s behavior arising from experience of Lux. If lux was bought by a consumer once for the first time and he or she got satisfied and is not regretting the decision that would create a mindset of lux in his mind. BELIEF AND ATTITUDES:

Belief is the descriptive thought that a person holds about something, attitude is the person’s favorable or unfavorable evaluations.

BUYING BEHAVIOR: The buying behavior process start with the first step of need recognition people recognize what they actually want this may include a persons need, want, necessity we will talking about the buying behavior of lux(why people buy lux when do they feel that they need a soap and not just any soap they go for lux. NEED RECOGNITION: In the very first step consumer recognizes a problem in our case the consumer recognizes that they need a soap to wash their face, hands, or they need soap for bath.so in the very first stage problem is recognized. INFORMATION SEARCH: Moving on to the next step which is of information search.in this step the consumer will store His/her need in the mind and will try to collect information related to that particular need being rational consumer will try to know more and more about the need in our case the consumer will 32

Declare your beauty pay attention more towards soaps they will watch more and more soaps ads, they will ask people about the good soaps so in this case they will gather more and information about the soaps. ALTERNATIVE EVALUATION: In this step they look for alternatives. Consumer will narrow their soap need to minimum good brands like: LUX, safeguard, dove, lifebuoy etc. and then they will select the best out of it the one they are attracted towards the most. PURCHASE DECISION: Finally after gathering the information the consumer know what he will be going for after gathering the information the consumer will get to know that lux is the leading soap brand with an affordable price and good results etc. the consumer will finally purchase lux. POSTPURCHASE BEHAVIOR: In this step the consumer decides whether they are satisfied with the lux soap bar will they stick to lux for further use.so post-purchase is based on satisfaction or dissatisfaction.

CONSUMERS BUYING BEHAVIOR FOR LUX (WHY PEOPLE BUY LUX): Here we will see that why consumer will chose lux over its competitors? What unique features lux is offering? Why ladies are attracted towards lux? All these questions will be answered As we know that consumer is the king of all business activities. So it’s very important for a marketer to know how the consumer perceives different things and how the consumer behaves accordingly. Lux has targeted the right people in right way they have captured what’s in the minds of their target audience their brand image is created with a simple line “beauty begins with lux”. Ladies believe that their first step towards beautiful skin is lux .lux will make them beautiful. This was the first step towards success by lux ladies stared to believe in this statement and lux became one of the best beauty soaps of Pakistan not only in Pakistan but all around the world. MENTS

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Declare your beauty The choice of celebrities to fulfill the goals and to increase the profits plus to create a brand image is common practice now a day. There are many reasons for extensive use of celebrities. The very first reason is that celebs have their high profile; celebrities can also help in ments stand out from the surrounding clutter, they can create or change the brand image in a positive way plus celebrities can also generate extensive public relation leverage for brands. So lux realized that they need to hire famous celebrities, to change or to make a brand new image of lux. They showed Mahira khan, Eman Ali, Reema Khan, Meera, Katrina Kaif, Ashwariya Roy as their face of the brand all these ladies where telling ordinary women that lux is the thing that will “bring out the star in you”. They started to believe in this simple but extremely clicking and strong statement and things got even better for lux people buy lux because they believe in promoting their products they make such attractive ads using dark beautiful colors just to seek the attention of people. AFFORDABILITY Lux soap is one of the most affordable beauty soap bar it’s not just affordable its good so the requirement of a consumer who are looking for a nice mild beauty soap for their sensitive skin with nice fragrance and colors and at an affordable price is fulfilled. Lux bar soap is inexpensive as compared to the soaps that are good in quality and can be purchased in departmental stores or from big beauty companies. Lux soap believes in offering people "chance to pamper them for an affordable price, “so ordinary people buy lux because of its affordability. VARIETY Lux is famous for its so many different flavors consumers obviously want variety in their daily soaps they want to have different types of flavors with different action like for cleansing, whitening ,soft youthful skin, glowing skin etc. and lux is focusing on all these things plus many other things they are trying to bring in different varieties in their beauty soaps because they want the consumer to stick towards their brand/soap they don’t want to lose them at any cost so they are trying to make more and good beauty soap. Lux is the global brand started by unilever lux achieved a position in the market now lux is market leader in countries like brazil, India, Thailand, south Africa lux achieved a unique image in the market.as we know that lux is not a new brand now a days so many new brands of soaps 34

Declare your beauty are coming in who are actually trying to compete with lux but lux has its own place people buy lux for their quality affordability variety etc.

THE BUYING BEHAVIOR OF CONSUMER FOR A NEW BRAND OF LUX How will people react towards the new product of lux as lux itself is an old product old brand so people are obviously familiar the brand image of lux is so nice so people will definitely try out the new product of lux? STAGES IN ADOPTION PROCESS AWARENESS: The consumer will become aware of the new product of lux but will lack in the information of the new product of lux INTEREST: The consumer will seek information about the new product of lux he will show interest in that because the consumer is already familiar with this brand and is hoping that this time they will rock again. EVALUATION: The consumer will find that out whether using the new product of lux make sense yes or no. The consumer will find out this thing through ads or from others etc. TRAIL: Consumer will then try out the new product of lux basically consumer will test the new product of lux ADOPTION: After trying the new product finally the consumer decides to make regular use of the new product of lux.

BUSINESS BUYER BEHAVIOR Lux is one of the largest brands in Pakistan considering the category of beauty soaps. Lux has gained a big market share domestically as well as in other 100s of countries around the globe. Lux is manufactured in 5 different types including •

Purple lotus and cream 35

Declare your beauty •

Aqua sparkle

•

Nature pure

•

Peach and cream

•

Strawberry and cream

Talking about the buyers of the lux that is business to business purchases; when a retailer orders the products to the supplying agent of the company, he keeps certain things in his mind. Things like market conditions, market demands, price of the product etc. Lux is being produced all over the world and due to this when a retailer or a buyer is given a choice to order products; he goes for the imported brand. The reason for the imported brand is that buyers they feel satisfied with the quality of the product. The major two types of the buying situations are straight rebuys and modified rebuys. The purchasers of the soap Lux make both types of the buying. Straight rebuys is when the buyers, they reorder the products without any modifications. Considering the small retail store holders in some small area, they buy the locally manufactured product and they reorder them without any modifications. The area and the standard of living of the people of that area impact it. If he purchases an imported one then it might stay laying on the shelf because of the high price compared to the locally manufactured one. Modified rebuys is when buyers want to modify the product specification, its price, or suppliers. Big retailers and the wholesalers, they make modified rebuys. They take the discounted rates from the company as a result of buying in bulk; they even go for various other types in the same product. Imported and domestically manufactured, both are accompanied by them. Business Buying Process involves decision making and with 5 major roles. 1.

s: These people are those who use the product at the end of the day. Now these people provide the retailers or the wholesalers about what they need. For instance, a retailer carries out a small research or asks his customers about what they need. One may say he needs Lux purple lotus and the other may say he needs aqua sparkle. So at the end when buyer makes decision about what to buy, he keeps those things in minds.

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Declare your beauty 2.

Influencers: Influencers of Lux are the people working in the different departments of the company. They often propose deals with modified specifications and also focus on the alternatives of the brand in the market.

3.

Buyers: The buyers of the brand Lux are the local retail stores of the big wholesale stores.

4.

Deciders: The buyers have the power to make selections and approve the final suppliers of the product; they would prefer to work with.

5.

Gatekeepers: Usually the agents/suppliers of the brand Lux; they do not show or leak the information to salespersons or anyone. The s are only checked by the owner of the stores.

ENVIRONMENTAL FACTORS According to agents of the company, they bulk raw material in bulk in order to ensure the adequate supply. The demand for beauty soaps are increasing day by day. Lux is a female beauty soap brand; the primary demand for the Lux is high as compared to the rest of the competitors. The company focuses on the new technological trends in order to make sure to produce the product with the greatest quality and at the cheapest cost. ORGANIZATIONAL FACTORS The main objective of the brand lux is to provide its customers confidence. Confidence in the sense if they use the beauty soap Lux; their skin would become better and their skin would glow. This is the policy Lux has been keeping since past twenty years.

INDIVIDUAL FACTORS The prices of the brand have been kept low in order to make sure everyone can afford it. The age of the people buying the beauty soap lux varies between 16 and 40. PROBLEM RECOGNITION:

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Declare your beauty The major problem that is being faced by the buyers of the lux is the imported and locally produced product. If on the same shelf the locally produced Lux is placed and with it, the imported Lux is placed. The preference of the customers goes to the imported one because of the factor that it has a psychological effect. Buyers think of the imported good as a far better quality product. GENERAL NEED DESCRIPTION: The Lux marketing agents supply the sufficient information of the needs/demands of the market and the buyers to the marketing department of the company which forwards the information to the rest of the departments. PRODUCT SPECIFICATION: Unilever has been focusing and diverting its attention towards the new methods of production which can reduce costs. For the product Lux, imported new technological machines are used to keep the production efficient and at cheaper cost. SUPPLIER SEARCH: The buyers that involves local retailers and the wholesalers; they look for the best agent with whom they can develop a strong and a comfortable relation about the supply. Lux has its own marketing department with marketing agents and also several other companies has been given contracts for the supply of the product, Lux. SUPPLIER SELECTION: The agents of the lux who propose good deals to the buyers are accompanied. For the wholesalers like Metro, they look for those agents who propose deals with good discounts and a bulk of supply on time whereas on the other hands, the local retailers; they do the same but the quantity they purchase is not that bulk which refrains them from good discounts.

ORDER – ROUTINE SPECIFICATION: This is the time when the buyers finally decide to order. They write a final order with the supplier they prefer to work with, listing all the technical specifications, the quantity of the product they need, the return policy and the delivery times.

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Declare your beauty PERFORMANCE OVERVIEW: A buyer of the product Lux working with a supplier of the company looks at the performance of the supplier and if he finds no trouble, no problems, he decides to continue with the same supplier otherwise he decides to drop the arrangement and start with the other supplier. E-PROCUREMENT: The brand Lux is not purchased online. No one prefers to get their credit or debit cards charged over the internet just to buy beauty soap; instead people prefer to buy it from the retail stores of the wholesale chains like Metro, Makro or Hyper star etc.

MARKET SEGMENTATION OF LUX

Market segmentation is dividing huge complex markets into smaller segments that can be reached more efficiently the reason behind dividing the market into small segments is that buyers differ in their wants, resources, location, buying attitudes, and buying practices. As we know that lux is a global brand. Lux is satisfying the needs of people all around the world lux is not only targeting one or two countries its targeting people all around the globe so reaching each and every market efficiently is not that easy so lux has also divided the market in small segments (selecting the segment or segments to enter).the market is divided geographically, demographically, psychographic, and behavioral variables. GEOGRAPHIC SEGMENTATION

Lux is geographically expanding its self-day by day lux being a brand of unilever is targeting India, Thailand south Africa, Pakistan, china, brazil, Canada, north America, western Europe, Srilanka, Bangladesh, the middle east. Lux has successfully targeted or expanded geographically in almost every country lux was started many years ago and up till now lux is just expanding in a positive way more than 50 years have ed but still the work of lux is not finished yet lux is making its mark day by day. Lux wants to satisfy its consumer everywhere they want their product to be in every departmental store of every country in almost all the cities of that country. Lux is the market leader of India, Thai land, Brazil, South Africa. Geographic segmentation for any brand is quite important because without expanding geographically the brand will never be able to satisfy the needs of people fully so dividing the marketing into small segments area 39

Declare your beauty wise, country, region etc. is compulsory or else the brand won’t be that famous or people will not be awarded of that particular brand. Lux has intelligently expanded all around the world.

DEMOGRAPHIC SEGMENTATION

Demographic segmentation is dividing the market according to age, gender, occupation, education, religion, income etc. basically demographic segmentation is the next level. Demographic factors are the most popular bases for segmenting customers groups. Demographically lux has targeted people all around the world of almost all ages because lux has a vast range of beauty soaps, age miracle, whitening soaps, cleansing, and many more so lux is targeting everyone. People of almost all ages plus lux is so affordable so women of any occupation (income) can easily buy lux. So over all lux is for everyone for every women who believes in the statement “beauty beings with lux” PSYCHOGRAPHIC

Psychographic segmentation is dividing the market according to social class, life style and personality. Lux as mentioned above has targeted almost all the classes because of its affordable price BEHAVIORAL

Market segmentation is done according to the occasions, benefits, status, loyalty status and attitude towards product. Lux is not related with any special occasion or event. Lux is a famous product known to many people and lux is providing benefits to its target market. Lux focused on its geographic segmentation lux is for everyone so lux has not divided its market into so many segments like lux soap is for oily, normal every skin type lux is for every class lux is not for any certain occasion. Lux basically focus on inter-market segmentation (forming segments of consumers who have similar needs and buying behavior even though they are located in different countries) as the definition says its self and mentioned above lux mostly focus on the geographic segmentation. Lux is trying to satisfy the needs of buyers who have similar needs this market segmentation is also known as cross market segmentation. 40

Declare your beauty

MARKET SEGMENTATION OF LUX

Two lux soaps, located on one shelf of retail outlet, one imported and other is local, isn’t it deviating the customer? Lux has segmented in most of the countries of the world here we will talk about Pakistan the lux which is produced in Pakistan is different from the lux which is produced in other countries so lux should keep its quality same for every country plus there is a huge difference in the packing to and price to so because the packing, price and quality are main differentiating factors. The thing is if geographically lux is segmenting in different countries then lux should keep price, packing and quality the same because as mentioned above these are the deviating factors of the consumer. SELECTING TARGET MARKET SEGMENTS

After segmentation the next step is that the company decides how many segments it will target. Now what a target market is a target market is the set of buyers who shares similar needs/wants or characteristics. Company targets the market in four ways: •

Mass marketing

•

Differentiated market

•

Concentrated market

•

Micro marketing

Lux is using undifferentiated marketing which is also known as mass marketing. In this firm decides to ignore market segment differences and target the whole market with one offer. This mass marketing strategy focuses on what is common in the needs of consumers rather than on what is different. Lux is bringing glamour into the world as lux is targeting all people all around the world as mentioned above. Mass marketing is not that easy as compared with differentiated segments, or niche marketing etc. because the margin of profits is low as compare with other segmented markets.

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Declare your beauty Lux became the first mass market toilet soap in the world in 1924. In 2005, Lux revenue was at 1.0 billion euros, lux had the market share spread out to more than 100 countries across the globe. Difficulties may arise during this type of market segmentation like a product/brand that will satisfy all consumers. But along with the difficulties lux has the advantage of increasing the costs of doing business, as lux is using mass marketing so for lux it is quite important to keep the same quality, price packing’s unilever should take certain steps of improving this whole issue a look because the your product quality should be the same for any country like in Pakistan when people see two lux with different packing they will be attracted more towards the imported international product the reason behind this is; a) According to them there is no match in the quality of imported lux with local; b) They fine the packing of international lux more attractive. DIFFERENTIATING AND POSITIONING

The way a product is defined in the minds of consumers as compared the other competing brands for any brand it is quite important to have a unique (positive) image the minds of the consumer.as they say products are created in the factories but brands are created in the minds. Marketers believe in this statement. Lux is positioned as a nice beauty soap having a vast variety .lux has successfully positioned itself in the minds of consumers. Lux promotes all the products in a very nice and descent manner when people see those ments then they are more attracted towards the brand and the image of lux brand in their minds is improved. COMPETITIVE ADVANTAGES

Competitive advantage is the advantage over the competitors gained by offering greater customer value, through low price or by providing more benefits lux is providing low prices. Lux believes in providing more for less which is the wining value proposition many companies go for this strategy for maintaining a position in the market company should make its own marketing strategy because if they will not do so their competitors will knock them out lux has made its own strategy that is why lux is still in the market lux is an old brand but still in the market not just in the market lux is competing well with new plus old brands of soaps.

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Declare your beauty PRODUCT OR SERVICE

LUX, a soap for everyone who wants to feel beautiful, it’s a product by unilever Pakistan limited and it is offered in market as daily consumption soap which can change your bathing into a experience of beauty and Luxury. Everyone needs a soap that is just not a random soap. That’s exactly what unilever is doing they are providing a special soap for every citizen of Pakistan. People who use LUX as their daily soap feel experience nice fragrance and quality bathing experience. On the other hand, when it comes for imported LUX, same product and same experience is being provided, however its target market is international countries. Unilever, currently working in all big countries of world is providing LUX for same reason and almost working under same motto: “LUX provides prestige-inspired beauty products made accessible to all which indulge the senses to make your skin and hair smell, look and feel more alluring and attractive, and inspire you to revel in the pleasure of expressing your beauty.” Differences are very minor between imported LUX and local one but unilever Pakistan needs to make LUX of Pakistan by creating more customer value not only for Pakistan citizen but for other people around its world. . If LUX of other countries is interfering our LUX economy then LUX of Pakistan should do same to them. Large amount of profit can be generated if sales of Pakistan LUX increases on international basis. The main thing that has to be noticed is that what is the difference between levels of product and services of local LUX and imported one, as far as augmented aspects of local LUX and imported one are concerned, they are almost same, which mainly includes after sale service, warranty and product . In actual product circle brand name is same, LUX is LUX no matter what. Features are almost same though variety is more in imported LUX products .design , of LUX is same all over the world but local LUX comes into 3 different sizes but imported comes only in one standard size in Pakistan. Packaging is not that different, LUX uses quality and colorful packaging for its product whether local or imported. Quality of imported one is bit improved because of use of heavy technology of developed countries but that doesn’t mean local LUX is of low quality. It is one of the best quality soap among all other Pakistani local soaps. However retailers don’t agree to consumer. They said that “both LUX soaps have same quality “All of this analysis leads us to customer value. s of LUX are 100% satisfied for what they have 43

Declare your beauty provided by unilever and there is no complaining or bad word of mouth for local LUX and imported LUX. LUX, both local and imported is complete consumer products. They both come under category of Convenience products i.e. A consumer good and/or service (such as soap, candy bar, and shoe shine) that are bought frequently, often on impulse, with little time effort spent on the buying process... Organization marketing, that unilever is doing for LUX is almost same every country. . in Pakistan lox is carry out promotional activities , campaigns , customer value services and sponsoring different programs to maintain its brand name means they mostly

use social

marketing for To nurture performing arts in Pakistan, LUX has started a LSA scholarship program providing free education to a chosen few who show immense potential.. Product line of local LUX is soaps, range of body and hand washes.

Aqua Sparkle

Crystal Shine

Nature Pure

Peach & Cream

Strawberry & Cream

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Declare your beauty

Peach and Cream

Strawberry and Cream

Strawberry and Cream hand wash

Magical Beauty(Purple)

Peach and Cream hand wash

Local Product Line

IMPORTED LUX HAS VASTER PRODUCT LINE; THEY PROVIDE LOADS OF VARIANTS

LUX shower gel

LUX bar soap

LUX hand lotion

LUX shampoo

LUX conditioner

LUX post wash

Imported Product Line Of LUX!!

BRAND POSITIONING OF LUX IN PAKISTAN

According to unilever Pakistan “We all want to be pampered, to look and feel great, to enjoy that moment when anything seems possible. And that's just what LUX offers you on a daily basis at a price you can afford...” That’s on what unilever is positioning its brand , “ LUX bring the star in you” Imported LUX brand is positioned in the basis of “Feminine, decadent, but always 45

Declare your beauty accessible, LUX provides women with a collection of sophisticated skin and hair care products developed to meet their needs and delight their senses.” So to some extent brand positioning of LUX is same all around the globe. Brand name “LUX” is LUX is derived from Latin, meaning "light" and it’s a short form of English word Luxury and name shows how the products work. It symbolizes Luxury, relaxation and comfort. This name LUX is one of the main reason of the popularity of this some. LUX is the name that goes out with its products, which describes products as light and gentle, luxurious experience, light as silk. It’s a unique name which is easy to pronounce and . Unilever is a manufacture‘s brand and its shares its profit with government though it is a semi private company that creates brands all over world such as LUX Although LUX has the same charm everywhere unilever Pakistan has to take some brand strategies in order to create high value for local LUX over imported one. It should create a line extension, i.e. introduce more variants in existing LUX products. Moreover unilever Pakistan can have a brand extension strategy, it can introduced complete brand new products under the name of LUX. For example LUX faces wash, face scrub and face creams etc. so that local products of LUX have more charm and customer attention then the local one. Efficiently done brand marketing strategies can make a tremendous change in the sales and value of local LUX products. Unilever Pakistan has to compete with international standards of unilever for getting more from the local LUX. NEW PRODUCT DEVELOPMENT / PRODUCT LIFE CYCLE

Lux is the global brand which is developed by unilever. It’s the world bestselling soap bar. It first launched its soaps in different colors & flavours, but due to its popularity it widen its range of products & now there are shower gels, bath additives, hair shampoos & conditioners of Lux. All these products are easily available in the market. Lux soaps are good & best for all type of skins from normal to oily hair The secret of Lux longevity is its consistent & continuous evolution i.e. attractive changes in their products whether it is the soap color, packaging or new variants, the brand is focusing to keep its youthful image and to made it attention seeking among audience. For this purpose they are Extending the soap cake to a range of shower gels, liquid soaps and moisturizing bars &this extension & revolution has helped the brand keep consumers

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Declare your beauty excited and the competition at bay. The best thing about Lux is its commercials. Casting famous models and actors in their commercials is one of the best strategies of lux. The message in their commercials are If it’s good enough for a film star, then it’s good for you too to Play with beauty— and they are conveying this message over the years. Interview was also conducted to know more about the Lux brand: Retailer said that imported lux is found only in two main markets of Lahore which are “Shah-Alam market” & “Akbari Mandi”. Whereas big stores like metro, macro, hyper star deal with products that have genuine license so that they sale local lux only (under the rule of unilever Pakistan). He said general grocery stores do have both Lux soaps (imported and local). Lux has adopted many new product development strategies and launched its wide range products to increase its popularity in the market among other brands. First a question arises what is “New product development strategy”? It’s the strategy to establish or launch its new products or to improve the quality of already existing products & launch them again with their new appearance in the market. Launching of new products is the firm’s own product development efforts. New products are important for both customers & marketers who serve them. These new products play very important roles in the lives of consumers & add new colors to their lives. Launching of new products is very important for the survival of brand. But Launching new products or improving the quality of already existing products is very risky for any company or brand & sometimes this strategy also fails because of many reasons like launching of new product at wrong time, with high price, it may be poorly designed or poorly d among the public. Lux segmented its soaps in to two categories “Local & Imported”. The reason was to increase the number of consumers & its sales as well. There is great difference in the quality of local & imported soap. Due to difference in the quality of products creates confusion among the consumers that which soap is better for their skin & which is not good for their skin. They should launch the same quality soaps with same price; this will not only increase their sales but also remove confusion from the minds of consumers that which one is better for their skin. Lux should improve the quality of ingredients that are used for their local products. Due to quality difference Local products are completely getting ignored and are becoming the cause of loss for their brand. To increase the popularity of local lux in the market, Lux should adopt the factors of new product development strategy.

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Declare your beauty To avoid these failures lux should follow the new product development process. Its first step is “Idea generation “Ideas generation is the systematic search of new product ideas & generating methods for them There are two sources of ideas that every brand including Lux follows. INTERNAL AND EXTERNAL IDEA SOURCES

Internal source involves getting ideas from surveys through internet research or from intelligent persons of the organization. Whereas external source involves getting ideas from suppliers or distributors because they both knows about consumer choices and their problems. Lux should follow both resources & should find through their researches that which soap is the requirement of the consumers whether local or imported. Next step is “Idea screening”. Brands have not only one idea; there is large number of ideas .It’s the organization responsibility to drop the poor ideas. Now Lux should choose whether the launch of one type of product is good or to increase the quality of local soaps to increase their sales like imported products. Third step is “Concept development & testing”. It includes to develop product image, to find out whether this product will be benefit for the consumer or not, how the consumer will perceive that product. To test their concepts whether their ideas are good or not, whether their products are good or not. Lux should adopt this strategy & find out which product will increase their sales & which products will be appreciated by the public. Local soaps in front of imported soaps will never be preferred because of the difference in quality, so Lux should improve the quality of its local soaps & use high quality ingredients for their production. Next step is “Marketing strategy development”. This process includes the three steps. First is recognizing target market. Lux should consider its target market & should specify that its products will attract which consumers. Lux target consumers are mostly females, because they launch skin beauty products which are for females. The second part includes products price & marketing budget for the first year. Lux should keep the same prices of its soap so that it results in increase of sales & lux should develop their annual or even long term budget. Third step is defining goals & profits. Next step in the process is “Business analysis”. It’s the step in which company over views the situation of their new product. They find out whether the launch of new product is fulfilling their profits & whether its benefit to their organization or not. Lux will continue producing their local products along with imported products if local product will increase their profits & their sales. Next step is “Product development”. The process of changing the concept in to reality just like Lux has change its concept in to reality by launching their 48

Declare your beauty products in market & identifying their market strategy. Next is “Test Marketing”. This includes placing the product in the market of particular areas just like lux has first placed its local products in Asian countries to find whether their local will get success or not. Last step is “commercialization”. To introduce the product finally in the market with the help of commercials, ads, billboards, internet, media etc. Lux is doing best & expensive commercialization of its imported products. Lux is hiring one of the top stars of the world in their commercials & ads. Next is managing New-Product development. It’s the process to solve the customer values &more customer satisfying experiences. First lux launched only soaps but for consumer convenience & consumer satisfaction it launched shower gels, shampoos, hair conditioners etc. only to satisfy consumer needs & demands. Team based new product development process is used to get their new products to market more quickly & efficiently. Under this approach all the company departments work under one roof & together. Like Lux hired some people like designers, marketers etc. to help them in launching their products more efficiently & quickly in market. It’s not an individual effort it’s a team effort. Next is “Product life cycle strategies”. First step is product development. This is the phase when sales are zero because the product is in stage of development & profits are non-existence because the product has not yet launched in the market so how the company can earn the profit. Next is “Introduction stage”, the stage in which the product is recently launched by the organization & is in process of introduction. Next is “Growth stage”. The stage in which the product is receiving praises from the market & is accepted highly by the market like lux local soaps are start getting accepted by the market in consumers & it results in increase in sales & increase in profits as well. Next stage is “Maturity”. It’s the period of slowdown in sales because it has achieved acceptance by most potential buyers.” Decline” stage is the last one in which sales & profits decreases due to decline in the sales of products like sales of local lux soap will decline because of good quality imported lux. Sales also decline because of good competitors’ products. Next is Product decision & service responsibility. It’s the company or brand responsibility to launch those products which are not harmful for people. Harmful products should be banned in the country. Like lux brand will be banned if it will launch the soaps which carries harmful 49

Declare your beauty materials for the skin. It’s our social responsibility as well as it’s the government responsibility to stop the launch of illegal & harmful products in the company. International product or service marketing is a very difficult step. To launch your product internationally is a big success for any brand but it’s not easy. First you have to decide which products should be launch in which countries. Quality of product also differs from place to place. Packaging also differs from place to place. In selection of colors you should be careful .Colors should be selected according to the choice of people of that area. Products should be launched carefully according to the choice & characteristics of that particular country or area. Preferences should be given importance. Lux should launch their products in those areas where people are beauty conscious and they care about themselves. If preferences are not kept in mind then it will result in failure of product in that particular area & will result in loss for the company. PRICING UNDERSTANDING & CAPTURING CUSTOMER VALUE PRICE

The amount of money charged for the product or service is known as the price of that particular product.as price is a policy so price majorly effects a consumers buying mist of the consumers buys any product if the price of the product is suitable for them or if the price is not suitable the consumer will leave that product and will switch to any other competitor who are providing that product in a lower price. However, price still remains one of the most important elements determining a firm’s market share and profitability. FACTORS SETTING THE PRICE

The firm set the price in such a way that above that price level they will lose their consumers and below that price well they will lose profits so selecting the perfect price of the product that will attract the customer and will again company some profits to is a hard job because at the end of the day it’s all about earning profits. Lux is a smart brand and it knows how to set the price that will gain them profits plus that will attract the consumers too. The price of lux is extremely affordable because lux is not targeting the upper class only lux is for everyone the ones who really wants a nice bar soap for their skin lux due to its affordability the reason why lux has gained so my consumers is that the price level of lux is affordable. If a firm is making a product that is satisfying the needs and wants of the 50

Declare your beauty consumer but the price is so high then they will leave the product and switch to another product that is satisfying the needs and wants but in a low price. The company first all assesses customers’ needs/wants after making all the strategies all the plans they set the price of that product there are basically four stages which a firm go through the following: •

Design a good product

•

Determine product costs

•

Set prices based on cost

•

Convince buyers of product’s value

Lux adopted the same strategy they designed the product their soap for the consumers then they determined the product cost and then they set the price level finally they set such a price of their soap that attracts maximum customers towards their soap. Lux because of its prices share 43% of market share prices are closely related with the market share lux is the product which is providing quality plus nice price. Lux know this thing very well that if they will increase the price of their bar soap then people will switch to other beauty soaps competing with lux but at a low price level. Lux provides the best pricing with the quality. Lux has adopted a good-value pricing strategies lux offers the right combination of quality, at a fair price. Lux is earning so much profit because they have selected the right way of setting price. Dove is the competitor of lux but most of the people in Pakistan don’t use dove or they prefer using lux over dove the main reason behind this is that lux is a bar soap having a price of more than rupees 50 which is not affordable for most of the people so that is why people use lux soap. Lux very well know this thing that middle class people will not pay a lot for just a beauty or bath soap so they have set a low price. External factors also affect the pricing of the product like the economic conditions have a strong impact on the pricing so while setting a price company analyzes the external environment too. ISSUSE

Now the issue to be discussed here is that there is huge price difference between the international and local lux. People think that as imported lux is expensive so that will give them better results 51

Declare your beauty as compared with a local lux which lack in quality so the price difference created a deviation for customer if the price and quality of local lux is set here in Pakistan to then this deviation can be removed easily the thing is that lux is a mass product(using mass marketing) so it’s for everyone.an uneducated person for whom the quality and price difference between local and imported lux does makes a difference will definitely go for cheaper lux but the educated people who wants to have best result when they will see such a price difference they will leave the local lux and will buy the imported lux because if the price of lux is so cheap then people will think that they might have used cheap 3rd class ingredients in their product because their cost of production was low that’s why the price of local lux is so cheap. People don’t really think that the products which are local are that good thou lux is the brand of unilever but still this thing is true there is a huge difference between local and international lux.so this issues should be resolved unilever is a very old name as unilever is making lux in almost every country so it is quite important for it to keep the quality constant and set a nice price that should attract all the consumers and they should such a price that answers all the questions of the consumers, because there are only a few unbiased people who don’t look over whether lux is imported or local. But most of the people buy the lux of Hindustan unilever as compared with local because they think that the price of Indian lux is more than local so it will be more effective then local lux.

PRICING STRATEGIES MARKET SKIMMING

Many companies adopt the market skimming pricing in this they initially keep the level of prices quite high market skimming can be useful in only two ways • • •

Product’s quality and image must the high price and enough buyers and it should attract most of the buyers to buy that in the first price. The costs of producing a smaller volume won’t be that high. Competitors should not be able to enter the market that easy.

MARKET PENETRATION PRICING

Some firms don’t believe in setting the price level high at initial stage they just keep the price low at first stage so that they can attract maximum customers.

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Declare your beauty While introducing the new products lux follow its own very strategies after making a a new product they decide whether they will keep the price level high at first or low initially. Most of the times they keep the price of the new product low/affordable so that everyone can buy that product get used to it and then buy the same product. For lux this strategy really works because of their attractive and affordable prices they attract many customers towards their product and the consumer thinks that I should try this product on.

PRODUCT MIX PRICING STRATEGIES

Setting price is not easy a firm before asg a particular price to their product has to check so many things there are different lines of pricing. • • • • •

Product line pricing. Optional-product pricing. Captive –product pricing. By-product pricing. Product bundle pricing.

PRICING OF LUX

Lux follow different strategies of pricing and attracting its customers lux reduce its price and write the new price instead of old price they often sell their products with others just to attract the customer the often introduce such offers like buy two lux get one free or buy three bundle of lux at a reduced price. Brands try to play with the minds of customers and they set the price in this way.

Lux follows different strategy of pricing like: •

Geographic pricing They set prices for customers located in different parts of the world

Like the price of lux soap in Pakistan is different from India and other countries etc. •

Dynamic pricing

Adjusting price continually to satisfy customers and lux follows the same thing the keep on changing the price when required. PRICE CHANGES

In some cases, the company may find it desirable to initiate either a price cut or price increase.in both cases. Lux soap doesn’t changes the price accordingly; Lux set their prices in such a way 53

Declare your beauty that the consumers respond to that price in a very positive way, Lux also set the price according to the competitor’s. They want to differentiate their price as compared with the competitor’s because they want their consumers to stick to them only.

MARKETING CHANNELS (PLACE)

Producing a product & make it available to buyers requires building relationship not only with customers but also with sellers & suppliers in the company’s supply chain. The supply chain consists of two partners upstream & downstream. Upstream provides information, supplies, raw materials, components and parts for the development of a product or service .Whereas downstream pattern concentrates on connection between the firm & customer. On line purchasing is also getting common. Because of new technologies & internet companies are developing complex relationship with firms. Whereas supply chain has two views Supply chain “make and sell” view includes the firm’s raw materials, productive inputs, and factory capacity. Like Lux needed to inquire which materials are required for the production of their products, what is their capacity & what is their range of producing products. Demand chain “sense and respond” view suggests that planning starts with the needs of the target customer, and the firm responds to these needs by organizing a chain of resources and activities with the goal of creating customer value. Lux first target their customers then launch their products & find out which products are the needs of the consumers. Unnecessary products should not be launched in the market. Value delivery network is the firm’s suppliers, distributors, and ultimately customers who partner with each other to improve the performance of the entire system. Lux will combine with the suppliers, retailers & people who are involved in the production of Lux products. When products get ready they are handed over to sellers to add value in them .For this purpose producers uses intermediaries. Intermediaries offer producers greater efficiency in making goods available to target markets. Through their s, experience, specialization, and scale of operations, intermediaries usually offer the firm more than it can achieve on its own. Lux larger & high level sellers to introduce their products in market, for example unilever limited makes millions of bars of lux soap each day, but you want to buy only a few bars at a time. So big retailers such as Big Bazaar buy Lux by the truckload and stock it on their stores shelves. In-turn you can buy a single bar of lux along with a 54

Declare your beauty shopping cart full of small quantities of shampoos & other related products. Thus intermediaries play an important role in matching supply & demand. Marketing channel consists of firms that have partnered for their common good with each member playing a specialized role.

Channel conflict refers to disagreement over goals, roles, and rewards by channel •

Horizontal conflict

•

Vertical conflict

Vertical conflict: channel will perform better if it includes a firm, agency, mechanism or providing leadership or has power to assign roles and manage conflict. Conventional distribution systems consist of one or more independent producers, wholesalers, and retailers. Each seeks to maximize its own profits, and there is little control over the other and no formal means for asg roles and resolving conflict. Whereas VMS consists of producers, wholesalers and retailers acting as a unified system. Another channel development is horizontal, in which two or more companies at one level together to follow a new marketing opportunity. By ing another company or by ing competitors can attract the consumers and will increase the sales of their products. Like if lux will combine its competitor like dove or some else it will result in increase in sales or if the Lux does contract with hi-fi stores that these particular stores must sell their products will increase their sales. Multichannel Distribution systems (Hybrid marketing channels) are when a single firm sets up two or more marketing channels to reach one or more customer segments.

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Disintermediation occurs when product or service producers cut out intermediaries and go directly to final buyers, or when radically new types of channel intermediaries displace traditional ones. It is the process of introducing products direct to customers without the help of intermediaries. Like lux will direct place its products in the market without publicizing their products with help of commercial, ads etc.

Integrated logistic s management emphasizes on teamwork both inside the company & among the entire marketing channel to maximize the performance of entire distribution system. Lux will coordinate with all individuals whom are doing better for the organization & their brand whether they are working inside the organization or outside the organization. Interview was also conducted to know more about the Lux brand: Retailer said that imported lux is found only in two main markets of Lahore which are Shah-Alam market & Akbari market. Whereas big stores like metro, macro, hyper star deal with products that have genuine license so that they sale local lux only (under the rule of unilever Pakistan). He said general grocery stores do have both lux soaps (imported and local). 56

Declare your beauty COMMUNICATING CUSTOMER VALUE: INTEGRATED MARKETING COMMUNICATIONS STRATEGY

Like all other brands, LUX has the most effective promotion mix that is one of the major causes of its success. LUX carefully blends promotional tools in order to get its customer value and loyalty. Many beauty soaps came out in market to compete with LUX but fail to do so because of the unique promotional mix of unilever LUX. Local LUX would have not achieved that if its promotional mix is not balanced. One cannot get into maturity level of market. Carefully blended promotional tools helps to give a crystal clear brand message to people out there. Advertising is one of the best tools both local and imported LUX is using for their brand imaging and broadcasting ads on TV is there main focus. Since the 1930s, over 400 of the world’s most stunning and sensuous women have been proudly associated with LUX ments. LUX makes its adds with the motto of “LUX brings the star in you” they use top actresses like Reema, Meera, Babra Sharif, Iraj Batool, Vaneeza Ahmed And Iman Ali are the beauties of Pakistan assisted with LUX. More over now males stars of Pakistan like Shaan and Ali Zafar are working in LUX ads and promotional videos and songs. Humaima Malik and Mahira Khan are new face of LUX. Internationally many old famous stars of Hollywood d for LUX, Wallace Beery Leela Chitnis, Madhubala, Nargis, Meena Kumari, and Loretta Young, etc. In print media LUX gives d in newspapers, magazines and all over internet. Moreover LUX spends large amount of money on bill boards all over Pakistan. The question is whether all this ment making consumer to buy local LUX only? Answer is that yes, it’s working to some extent. Sales promotion is the short-term incentives to encourage the purchase or sale of a product or service. LUX is playing this game very smartly. Gold coin offer of LUX is one of the best sales promotions. Discount on family pack is another discount offer that worked quite well. Unilever organizes a Mela on super stores like hyper star and metro where LUX is offered at low price (4 packs in RS/120 instead of RS/ 160). The company goes for sponsoring events in order to heighten the company and brand image. Mostly the company goes for financing such kind of events in which its product has got some room to build likeness. The company also goes for sponsoring fashion shows in different cities. Several small level promotional campaigns at different schools, colleges, universities and recreational parks take place. These promotional activities of LUX are very successful which has 57

Declare your beauty made it a household common name and. Moreover sponsoring different shows like LUX Superstar and LUX style Awards has made the product a part of the glamour world. LUX is sponsoring movies like love may gum and other events like LUX Carnival de Couture. For healthy public relations, the company has established a consumer department to manage the complaints of the end-s there is another department which works for media war and legal issues. If anything goes wrong with LUX brand image. They immediately take actions. Personal selling and direct marketing is also done in major stores of Pakistan like hyper star and metro. All these ment is by unilever Pakistan. There is no sign of imported LUX encouragement in ments. Though is there is always a question that why sales of imported LUX is greater than local one. IMPACT OF PROMOTIONAL MIX ON SALES

It spends almost 20% to 25% of its Net Proceeds from Sales (NPC) of LUX for promotional activities for LUX. Unilever believes that ment have a strong impact on sales. For this the ads are shown on television.

LUX PAKISTAN IS EFFECTIVELY DEVELOPING MARKET COMMUNICATION

People are aware of this brand call LUX; they have knowledge about it through media and word of mouth. Customer like it and prefer it on other soaps and stuff. They are convincing that LUX has no substitute and then they finally buy LUX. Unilever Pakistan designed a message for their product “LUX brings the star in you “which follows the AIDA Model. It gets attention of common people and hold interest because everyone needs glamour in them. It arouses interest so much that people are convinced to buy it. Because everyone wants to feel good and special on daily basis .so all in all LUX is using a rational appeal for it. CHAPTER 15: ADVERTISING AND PUBLIC RELATIONS

LUX always keeps in mind its advertising objectives. They inform about their products tells how special there product is and how well they relate to common people life. And remind the

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Declare your beauty consumer that LUX has all what they want in a bathing/ soap and they are proving much more than that. LUX mostly uses Reminder advertising i.e. LUX being a product in mature stage of product life cycle needs maintain customer relationships and keep customers thinking it. This helps LUX to maintain customer relationship and there brand image. It also helps to remind customer where and when to find LUX. Ads of LUX also remind customer that they are not using and outdated product. LUX spend a lot on its promotional ads however maturity staged products don’t need a heavy budget for promotion. Market share of LUX is higher than its competitors so it should spend a lot on its promotion in order to keep it constantly high. Unilever Pakistan should spend some more in all this order to wipe out imported LUX from the mind of all consumer. Advertising Strategy that is mostly used for LUX is giving its message “LUX brings the star in you clearly” and the medium they have used till now is broadcasting its ment on local channels and through billboards. Ads of LUX are clear, concise and effective; they get consumer attention and communicate well with its targeted market. The main message “LUX brings the star in you” identifies consumer benefit that is that an ordinary person can feel like a star just by using soap. LUX really means this message because they actually copy stars as their role model who do ads for LUX. Its believable message because LUX makes a customer feel really special by using like “KHAAS AAP K LIYE”. Creative team of LUX always find the best approach, style, tone, words, and format for executing the message of their ads. Reach is a measure of the percentage of people in the target market who are exposed to the ad campaign during a given period of time. And LUX reach is very high almost everyone watches LUX ads in almost every local channel and billboards all around Pakistan. LUX ads are blend of life style, musical and personality symbol. Impact of LUX ads is quite high and customer actually falls for the message they are trying to give. Public relations involves building good relations with the company’s various publics by obtaining favorable publicity, building up a good corporate image, and handling or heading off unfavorable rumors, stories, and events and they are far more effective then ment they are less expensive as compared with ment. Major public relation sources used by LUX are news, Events, programs and movies sponsored by LUX are part of entertainment news of

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Declare your beauty Pakistani news channels. Speeches by directors of unilever are also a nice way for making good public relations. Special events like fashion shows, beauty context and awards are also a good way to enhance your public relation. Mouth of word is playing a great deal in their favor of LUX. Apart from that social networking and internet, is being used by LUX as a cheap way of making good public relations. Unilever Pakistan Is doing a great effort in making LUX one of the best soap that ever came however customer are not cooperating with them by trusting them with their product of same value , quality and experience. Pakistan citizen should buy local LUX so that one day it might get the position of best soap all over the globe.

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