INTRODUCTION

High priestess of sacred Indian temple meets English army officer who's
unwittingly strayed into holy ground. They fall in love. Her orthodox father
vows vengeance... That's the story of Lakm, a 19th century opera written by
Frenchman Leo Delibes, from which Simone Tata borrowed the name Lakm
(French for Lakshmi, the name of the priestess).
The current size of the Indian cosmetic market is approximately US$ 600
million. Of this, the fastest growing segment is color cosmetics, accounting for
around US$ 60 million of the market. Industry sources estimate a rapid growth
rate of 20 percent per annum across different segments of the cosmetics industry
reflecting an increasing demand for all kinds of beauty and personal care
product. Growth has come mainly from the low and medium-priced categories
that account for 90 percent of the cosmetics market in terms of volume.
Even with a 20 percent average growth rate, the per capita consumption
of cosmetics is very low in India. Current per capita expenditure on cosmetics is
approximately US$ 0.68 cents as compared to US$ 36.65 in other Asian
countries. However, with changing lifestyles, higher disposable incomes,
increasing advertising, penetration of satellite television, awareness of the
western world and growing importance of beauty pageants, there have
been significant changes and use of cosmetics is on the rise.
Lakme, a brand originally introduced by the Tata group of India, now
bought over by Hindustan Unilever (HUL) of the Unilever group, Tips & Toes,
another domestic player, and Revlon dominate the US$ 60 million color
cosmetics market. Multinationals, Revlon of the U.S. and L'Oreal's Maybelline
has a dominant share of the small premium lipsticks and nail enamels market.
Mass-market products account for a major share, while the premium segment
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accounts only for a mere 9 per cent in lipsticks and 5 per cent in nail enamels.
Lipsticks account for nearly a third of the market at US$ 21 million, while the
market for nail enamels is estimated at around US$ 23 million. The color
cosmetics segment is very competitive and has a high penetration level of 80
percent.
The skin care market in India is estimated at US$ 180 million. Within the
last decade, this segment has seen many consumers slowly shift from the mass
to the premium end of the market. The penetration rate is high in the skincare segment as compared to color cosmetics. In the skin-care segment, price
and volume played an equal role in value growth. Moisturizing lotions, fairness
creams and face cleansers are the popular categories in the skin-care segment
and account for approximately 60 percent of the skin-care segment. The major
players in this segments are Lakme, Ponds, Fair & Lovely of the HUL group
with a 50 percent market share, followed by players such as J.L. Morison that
markets the Nivea range of products in India, Godrej and Revlon. Penetration
levels of international cosmetics brands in India are still low. Foreign brands
currently constitute only 20 percent of the market. A major reason for low
penetration of international brands can be attributed to high pricing. These
companies initially gained sales on their international brand image, however,
repeat purchases were not forthcoming and to retain their sales growth, several
foreign companies reformulated price strategies to tap the large Indian middle
class. Urban women in the middle and upper income groups in the age range of
23-50 is the target group for international brands, as this group looks for better
products and is willing to pay a premium for international quality products.
Industry estimates suggest that there are close to 10 million such women in
India.

INTRODUCTION TO COSMETICS INDUSTRY IN INDIA

India, with a population of nearly a billion people, is a country of contrasts. India's
urban population is the main engine that fuels the demand for various cosmetic products. The
morphing of India is subtle and the changes are not visible for the first time visitor.
However, the market liberalization process that began in 1991, along with the crowning of
three Indians as Miss World and Miss Universe during the preceding four years, have made
Indian women conscious of their appearance. Consequently, the cosmetic consumption
patterns of Indian women have changed, and this trend is fuelling growth in the cosmetic
sector. The Indian cosmetics and toiletries market grew by 8.7% in current value terms in
2001, with value sales amounting to Rs126 billion.
The market for cosmetics and toiletries in India is characterized by high volume sales of lowend toiletry products, while at the same time the legendary emerging middle-class has
generally been fuelling demand for cosmetics and upper-mass toiletries. Products that are too
specialized have yet to be successful on the Indian market. Examples include toners, hand
care and other value-added skin care products, bath & shower products and aftershave balm.
Only the richest consumers can afford these; indeed, the average consumer may be unaware
of their purpose or even existence. This also explains the relatively poor showing of
perfumes, especially the premium variety.
This cosmetics and personal care industry has been growing at an average rate of 20 per cent
for the last few years. The growing Indian cosmetics market offers promising prospects for
international brands. The growth rate in the cosmetics market reflects an increasing demand
for beauty care products in India. Perfumes and fragrances, skin care, and hair care products
are some of the major segments with promising prospects for U.S. companies. Penetration of
most cosmetic and toiletries is very low in India. Current consumption of many products is
well below that of many countries in Asia. The low market penetration of many cosmetics
and personal care products offers room for growth.

INTRODUCTION OF LAKME UNILEVER PRIVATE LTD

Lakme is the Indian womans Beauty Sutra inspiring expression of her unique
beauty .Lakme brings expert products and services that are borne out of true understanding of
the needs of the Indian woman. They help the Indian woman in expression of her best self
sensual, original, expressive, alive and intuitive. Lakme inspires her to unleash the potency of
her femininity, beauty and sensuality

Key facts
Lakme was the first major beauty brand in India and takes pride in being the expert on Indian
Beauty for over 50 years. It is complete beauty brand spanning colour cosmetics, skin care &
hair styling products and extending to beauty services through the network of Lakme Beauty
Salons. Its bond with beauty and fashion is manifested through the Lakme Fashion Week,
which is now the largest fashion event of its kind in the country. Lakme has a foot print of
over 1200 assisted sales outlets, which is the largest span of outlets with Beauty Advisors
in the country.

Our vision
Unilever products touch the lives of over 2 billion people every day whether that's through
feeling great because they've got shiny hair and a brilliant smile, keeping their homes fresh
and clean, or by enjoying a great cup of tea, satisfying meal or healthy snack.
A clear direction
The four pillars of our vision set out the long term direction for the company where we
want to go and how we are going to get there:
We work to create a better future every day
We help people feel good, look good and get more out of life with brands and services
that are good for them and good for others.
We will inspire people to take small everyday actions that can add up to a big
difference for the world.
We will develop new ways of doing business that will allow us to double the size of
our company while reducing our environmental impact.
Purpose & principles
Our corporate purpose states that to succeed requires "the highest standards of corporate
behaviour towards everyone we work with, the communities we touch, and the environment
on which we have an impact."

Always working with integrity

Conducting our operations with integrity and with respect for the many people, organisations
and environments our business touches has always been at the heart of our corporate
responsibility.
Positive impact
We aim to make a positive impact in many ways: through our brands, our commercial
operations and relationships, through voluntary contributions, and through the various other
ways in which we engage with society.

 Continuous commitment
We're also committed to continuously improving the way we manage our environmental
impacts and are working towards our longer-term goal of developing a sustainable business.

Working with others

We want to work with suppliers who have values similar to our own and work to the same
standards we do. Our Business partner code, aligned to our own Code of business principles,
comprises ten principles covering business integrity and responsibilities relating to
employees, consumers and the environment.

Meaning and definition of product mix

The term product mix implies all the products offered by a firm for sale. It may consist of
one line products or several allied product lines.
Product line refers to an assortment or class of similar or related products and
services. They may be similar in technology, customers needs, channel used, market served or
in some other respect. An individual product in a line is known as a product item. There are
several product items in a product line.
Product mix has three important aspectswidth, depth and consistency. Width of the
product mix is measured by the number and variety of product lines offered by a firm. It
shows the degree of diversification of a firms activities. The depth of product mix is
determined by the number of items in a product line.
By offering several brands of a product, a firm can cater to widely varying needs and
tastes of customers and thereby beat its competitors. For instance, the range of bathing soaps
(Lifebouy, Lux, Rexona, Liril, etc.) offered by Hindustan Lever Ltd. shows the depth of its
product line while the width of its product mix consists of Dalda Vanaspati, Close-up
Toothpaste, Talcum powder, etc. in addition to the soaps.
The consistency of product mix refers to the degree of similarity between product
lines in terms of their end-use, production requirements, price ranges, distribution channels,
advertising media, etc.
These dimensions of the product mix serve as guides to decisions regarding the
additions and deletions of product items and line. By increasing the consistency of product
mix, a firm can reduce its costs of operations and acquire unparalleled reputation in the
market.
Product mix or product assortment refers to the number of product lines that an
organisation offers to its customers. Product line is a group of related products manufactured
or marketed by a single company. Such products function in similar manner, sold to the same
customer group, sold through the same type of outlets, and fall within a same price range .
Product mix consists of various product lines that an organisation offers, an organisation
may have just one product line in its product mix and it may also have multiple product lines.
These product lines may be fairly similar or totally different, for example - Dish washing
detergent liquid and Powder are two similar product lines, both are used for cleaning and
based on same technology; whereas Deodorants and Laundry are totally different product
lines.

An organisation's product mix has following four dimensions:-

1. Width,
2. Length,
3. Depth, and
4. Consistency.
Width
The width of an organisation's product mix pertains to the number of product lines that the
organisation is offering. For example, Hindustan Uni Lever offers wide width of its home
care, personal care and beverage products. Width of HUL product mix includes Personal
wash, Laundry, Skin care, Hair care, Oral care, Deodorants, Tea, and Coffee.

Length
The length of an organisation's product mix pertains to the total number of products or items
in the product mix. As in the given diagram of Hindustan Uni Lever product mix, there are 23
products, hence, the length of product mix is 23.

Depth
The depth of an organisation's product mix pertains to the total number of variants of each
product offered in the line. Variants includes size, colour, flavors, and other distinguishing
characteristics. For example, Close-up, brand of HUL is available in three formations and in
sizes.

Consistency
A consistency of an organisation's product mix refers to how closely related the various
product lines are in use, production, distribution, or in any other manner.
Product mix decision refers to the decisions regarding adding a new or eliminating any
existing product from the product mix, adding a new product line, lengthening any existing
line, or bringing new variants of a brand to expand the business and to increase the
profitability.
Product Line Decision - Product line managers takes product line decisions
considering the sales and profit of each items in the line and comparing their product
line with the competitors' product lines in the same markets. Marketing managers
have to decide the optimal length of the product line by adding new items or dropping
existing items from the line.
Line Stretching Decision - Line stretching means lengthening a product line beyond
its current range. An organisation can stretch its product line downward, upward, or
both way.
1. Downward Stretching means adding low-end items in the product line, for example in
Indian car market, watching the success of Maruti-Suzuki in small car segment,
Toyota and Honda also entered the segment.
2. Upward Stretching means adding high-end items in the product line, for example
Maruti-Suzuki initially entered small car segment, but later entered higher end
segment.
7

3. Two-way Stretching means stretching the line in both directions if an organisation is in

the middle range of the market.

Line Filling Decision - It means adding more items within the present range of the
product line. Line filling can be done to reach for incremental profits, or to utilize
excess capacity

RESEARCH METHODOLOGY
The research is based on:Primary Data
1) Questionnaire
Secondary Data

Internet

Company Reports& Broachers

Magazines
Data is also gathered by talking to the respondents (Target Audience,
understanding their beauty needs,what aspire them to go for the (lakme)brand.
Also the level of:-

Brand awareness,
Price level,
Visibility of brand personality.
Expectancy of Communication
All these factors were the prime criterion for selecting (Which brand??), Short
listing and ranking (level of trustworthiness? or most favored) which had helped
us for identifying the winner in cosmetics industry.

Objective
1

Help in building a positive association with people thereby enhancing brand

personality

How to break the negative connotation of Being fashionable

Why has Lakme missed out on promotional gauge despite roping in top
brand ambassadors.

How can the brand retain its lost spot?

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RESEARCH DESIGN
Our research is based on the Exploratory Study.
Research is exploratory when you use no earlier model as a basis of your study.
The most usual reason for using this approach is that you have no other choice.
Normally you would like to take an earlier theory as a support, but there
perhaps is none, or all available models come from wrong contexts.
Exploratory research means that hardly anything is known about the matter at
the outset of the project. You then have to begin with a rather vague impression
of what you should study, and it is also impossible to make a detailed work plan
in advance.
The gradual process of accumulating intelligence about the object of study
means also that it will be impossible to start by defining the concepts of study.
You have to start with a preliminary notion of your object of study, and of its
context. During the exploratory research project, these provisional concepts
then gradually gain precision.
We have collected our data by drafting a questionnaire and thereby
interpreted or analyzed or result by using the Microsoft excel.

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COMPANY PROFILE

Half a century ago, as India took her steps into freedom, Lakme, India's first
beauty brand was born. At a time when the beauty industry in India was at a
nascent stage, Lakme tapped into what would grow to be amongst the leading,
high consumer interest segments in the Indian Industry - that of skincare and
cosmetic products. Armed with a potent combination of foresight, research and
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constant innovation, Lakme has grown to be the market leader in the cosmetics
industry. Lakme today has grown to have a wide variety of products and
services that cover all facets of beauty care, and arm the consumer with
products to pamper herself from head to toe. These include products for the lips,
nails, eyes, face and skin, and services like the Lakme Beauty Salons.
A little bit of Lakm history:
In 1995, Lakm Ltd (a Tata Group company) and HLL formed a 50:50 venture
Lakm Lever that would market and distribute Lakm's products. In 1998,
Lakm sold its brands (and the 50 per cent it owned in the JV) to HLL, renamed
itself Trent and entered a different business (retail). Only, the years between
1995 and 2000 saw HLL wrestling with several issues with a bearing on
Lakm's future. A brand that has over 5 decades talked of beauty is none other
than Lakm. Launched in 1952, it offered a range of cosmetics with nail
polishes & lipsticks from the early 80s. Lakm also understands the importance
of maintaining and accentuating a womens natural beauty, for this it has
introduced a range of skincare products from 1987. These ranges have been
constantly innovated to bring specialized beauty care and complete the range for
the definitive women.
A brand that has over 5 decades talked of beauty is none other than Lakm.
Launched in 1952, it offered a range of cosmetics with nail polishes & lipsticks
from the early 80s. Lakm also understands the importance of maintaining and
accentuating a womens natural beauty, for this it has introduced a range of
skincare products from 1987. These ranges have been constantly innovated to
bring specialized beauty care and complete the range for the definitive women.
Chopra accepts that distribution has been the company's Achilles heel for some
time: ''The supply-chain hasn't been as robust as it should have been, but that
13

has been the result of our efforts to reposition and reintroduce the brand.'' The
positioning bit, although complex, is clear: Ponds is Lever's primary skincare
brand; Lakm, its aspirational colour cosmetics brand, which also has a
presence in skincare.
The 'aspirational' qualification would mean Lakm would compete at what the
company terms the 'upper-mass' (premium) end of the colour cosmetics
spectrum (products priced between Rs 85 and Rs 250) where a slew of
competitors, ranging from Revlon (through Modi Revlon) to Chambor, are
already slugging it out. Says Meghna Modi, 26, Executive Director, Modi
Revlon: ''The numbers say it all. According to ORG-MARG's retail audit, we
have an 84 per cent share of the premium end of the colour cosmetics market.''
Chopra is quick to rubbish this claim; he says ORG-MARG does not have a
representative sample of the 60,000 outlets through which colour cosmetics are
sold in India.
Still, it is conceivable that Lakm's new-found aspirational strategy could have
been brought about by competitors like Revlon and Maybelline, which targeted
this segment. Indeed, the company's non-transfer lip-colour range follows in the
wake of Maybelline's launch of a similar range, and its new nail-enamel colours
come soon after Maybelline and Revlon launched their nail-enamel range. The
company's defense is that it takes at least 15 months from the conceptualization
to the actual launch of products.
And fashion consultants like Meher Castelino believe the brand commands an
edge at the high-end: ''By appropriating the fashion platform for itself, Lakm
has entrenched itself at the glamour-end.''

14

15

SWOT ANALYSIS Of LAKME

Strengths:
Local brand of specific relevance to India.
Strong R&D capability,well linked with business.
Integrated supply chain and well spread manufacturing units.
Ability to deliver Cost Savings.
Access to Unilever global technology capability and sharing of

best practices

from other Unilever

Weaknesses:
Price positioning in some categories allows for low price competition.
Varying quality range in its products.
Falling Quality of Lame salons
Opportunities:
Brand growth through increased consumption depth and frequency of usage
across all categories.
Upgrading consumers through innovation to new levels of quality and
performance.
Building brand image by collaborating with top designers in Lakme Fashion
week
Threats :
Aggressive price competition from local and multinational players.
Spurious/counterfeit products in rural areas and small towns.
Non Existence of brand image in long Run

16

Everything a girl wants

Lakm has a wide range of products in color cosmetics that bring visible results.
To add to this vast repertoire is a range of specialized skin care products for the
discerning women. Keeping skin looking healthy and glowing is also a part of
looking great. Lakm provide the complete package with the skin care range
and the wide range of colors to spice up the look.
Lakme products
Colours
From the spicy shades to the flattering look, Lakme offers a range of products in
the face, lips, eyes and nail segment for the beauty aficionados.
Face
Lakm Daily Wear Souffl ,Lakm Perfecting liquid Foundation - Lakm
Radiance Compact , Lakm Flawless Matte Complexion Compact
Lips
Lakm Enrich Lipcolor - . Perfecting Definition Lip Pencil - Starshine Lipgloss
- Glosses in lustrous shades available in 14 shades.
Eyes
From dramatic to natural look- a wide range of products are on offer to create
the perfect eyes.
1.

Lakm Kajal:

2.

Lame Insta Eyeliner eyelids

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3.

Lakme Lakm Shimmer Eye Cube:

Nails
True Wear Nail Enamel -Nail Enamel with Lacquer-like finish. Contains resins
and silicone with colour lock technology that gives brilliant long lasting shine
Skin
For radiant skin Lakm is there to pamper your skin with specialized products
for the diva in you.
Cleansing
Strawberry Silk Splash Face Wash , Lakm Fundamental Deep Pore Cleansing
Milk Moisturizing
1. Lakm Fundamental Peach Milk Moisturiser skin.
2. Lakm Fundamental Winter Care Lotion Sun Protection
The range comprises of lotions to keep your skin healthy and younger looking.

18

Various lakme products

19

VISION
To earn the love and respect of India, by making a real difference to every
Indian.. HLL follows its parent companys mission to add vitality to life. They
strive to meet everyday needs of nutrition, hygiene, and personal care products
that help people feel good, look good, and get more out of life.
STRATEGY
Grow ahead of the market by leading market development Activities
Leverage positive impact of growing Indian economy on consumer
spending
Grow a profitable foods and Top end business
Grow the bottom-line ahead of top line
Strong commitment to sustainable development
DISTRIBUTION
With respect to distribution related activities like sales and
marketing, HLL is second to none in pushing the boundaries of
what is possible financially, structurally, and logistically. Beyond
its pioneering work FMCG distribution, the company has sought
to instill in its customers an elevate sense of brand experience
while simultaneously providing greater and more varied access
to

its

products

as

well

as

improved

clarity

to

its

communications. New initiatives include raising brand visibility

through in-store promotions, store-based product facilitators,
and self-service. HLL has enabled an even further level of
personalization and brand experience in the direct sales arena
with its ground-breaking Hindustan UniLever Network, having
amassed an army of consultants 250,000 strong with access to
80 % of city dwelling Indians.
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Hindustan Unilever Present Scenario

15,000 employees
1,200 managers
2,000 suppliers & associates
75 Manufacturing Locations
Total Coverage 6.3 Mln Outlets
Direct Coverage 1 Mln outlets

21

22

Market Overview
The current size of the Indian cosmetic market is approximately US$ 600
million. Of this, the fastest growing segment is color cosmetics, accounting for
around US$ 60 million of the market. Industry sources estimate a rapid growth
rate of 20 percent per annum across different segments of the cosmetics industry
reflecting an increasing demand for all kinds of beauty and personal care
product. Growth has come mainly from the low and medium-priced categories
that account for 90 percent of the cosmetics market in terms of volume.
The Shahnaz and the Biotique brands dominate the premium herbal cosmetics
segment in India, estimated at USD 100 million.
Since liberalization, many international brands like Avon, Burberrys,
Calvin Klein, Cartier, Christian Dior, Estee Lauder, Elizabeth Arden, Lancome,
Chambor, Coty, L'Oreal, Oriflame, Revlon, L'Oreal, Yardley, Wella,
Schwarzkopf, Escada, Nina Ricci, Rochas, Yves St. Laurent and Japanese
cosmetics company, Shiseido have entered the Indian market. The prices of
most foreign brands have been fairly high, which has deterred average
Indian consumers. International brands cater to a segment that can
broadly be classified as the urban higher income group.
Market Trends
Cosmetics and toiletries are not just the domain of women any longer and
Indian men too are increasingly taking to the use of more and more body sprays,
perfumes and other cosmetics and toiletries. With rising demand from men, the
Indian market is getting enlarged and many players are coming out with
cosmetic products especially skin care products for men. The market size of
men's personal care segment is estimated at approximately US$ 165million,
with Gillette having the largest market share. Other major players in this
segment include Godrej, J.L. Morison and HLL. The growing demand for
23

men's cosmetics have made many direct selling companies such as

Modicare and Amway to launch new products for men.
In the last five/six years, there has been a renewed craze for herbal
cosmetic and personal care products, especially in the skin care segment with
the growing belief that chemical-based cosmetics are harmful. Shehnaz
Hussain, Biotique, and Lotus Herbals are the major players in this segment.
Many companies also expanded their range to include herbal variants..
The urban population in the major cities with increasing purchasing
power is the main force that drives demand for various cosmetic products in
India. The advent of satellite television and awareness of the western beauty and
fashion world, advertisements and promotions, increasing number of women
joining the work force is changing preferences, customs and cultures in India

Import Market
Costs for importing products are much higher than producing it in the country.
India allows entry of imported cosmetics without any restrictions but the
average import tariff on cosmetics products is currently very high at 39.2
percent. This makes imported products very expensive for most consumers.
Most foreign cosmetics companies selling premium brands have had a difficult
time developing the low volume premium market in India. Many had to re-work
price strategies towards the mass segment. Price is not the only reason
responsible for their problems. Poor assessment of the size of the upper middle
and high-income groups, and price sensitivity even within these groups, had
added to their problems.
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According to estimates of industry experts and trade publications, India's

annual imports of cosmetics and toiletries and intermediate raw materials
is approximately US$ 120 million. Countries like US, Europe, mainly France,
Germany, Italy, Netherlands, and Spain account for the major share; and
Australia, China, and Japan account for rest of the share.

Competition
The Indian cosmetic market, which has been traditionally a stronghold of a few
major Indian players like Lakme, and Ponds has seen a lot of foreign entrants to
the market within the last decade. India is a very price sensitive market and the
cosmetics and personal care product companies, especially the new entrants
have had to work out new innovative strategies to suit Indian preferences and
budgets to establish a hold on the market and establish a niche market for
themselves.
Given the price-sensitivity of the Indian consumer who do not normally prefer
to fork out a large sum at one time, many cosmetic and toiletries companies
25

launched their products in smaller pack sizes to make them more affordable.
HLL and Revlon were the first to introduce small pack sizes. Revlon introduced
its small-range of 8 ml nail polishes and lipsticks, and was soon followed it its
strategy by major Indian companies as well.
Stiff competition in the cosmetics and toiletries market also saw an increase in
the range of new products being introduced for newer application concepts in
the last few years. In the skin-care segment, from just creams and moisturizers,
there has been a upgrade to value-added products such as under-eye wrinkle
removing creams, dark circle removing creams toners, sunscreen lotions,
fairness creams, and many more.
.
Beauty counselors or advisors at retails outlets have been very successful in
gaining attention, creating product awareness and overcoming consumers lack
of familiarity with, and fears about many cosmetics and personal care products
such as home hair permanents and color cosmetics. Some companies such as
Lakme have even set up exclusive Lakme beauty parlors at major cities in
India through the franchisee route .
L'Oreal markets its range of specialized hair care products exclusively through
salons and beauty parlors. L'Oreal currently is the only company in the
market that has a hair color range tailored exclusively for parlors..
A strong brand promotional campaign, good distribution network,
constant product innovation and quality improvement, and the ability to
provide a variety of quality products are some of the major reasons for the
success of most companies.

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HLL, is currently India's largest cosmetics and personal care products producer
and its brands has the dominant share (more than 50 percent) in segments such
as personal wash, skin care, shampoos, lipsticks and nail polish.

Sales Prospects
The growing Indian cosmetics market offers promising opportunities for
international brands. The growth rate in the cosmetics market reflects an
increasing demand for beauty care products in India. The most promising
segments for international companies to pursue are perfumes and
fragrances, and specialized/professional skin care and hair care products.
The fastest growing market is however color cosmetics, which account for
US$ 60 million of the total market.
The rural market in India for cosmetics and toiletries remains is largely
untapped. Major domestic players have also not been able to penetrate this
market. The urban market itself for specialized cosmetic products remains to be
fully exploited. The Indian skin-care market is not yet fully tapped and offers
27

promising prospects as a growth area. Penetration of color cosmetics is lower

than the penetration prospects of the skin-care segment.
To promote the growth of their products, a dominant player like Lakme
have embarked upon a business plan to establish their exclusive franchised
beauty salons across major metros in the country.
Imported cosmetics have had a major impact on the Indian market. Foreign
products have enhanced growth of the Indian market by attracting aspirational
consumers and increasing acceptance of color cosmetics, previously perceived
by many as harmful to skin. Indians generally perceive foreign brands as being
of superior quality.
Other key issues regarding sales prospects are product variety and
retailing strategies as well. There is a marked shift among consumers from
functional common-fits-all products to more specialized formulations. This
is one of the reasons why an increasing number of cosmetic companies are
dealing with consumers directly through special exclusive counters in
major departmental stores and malls featuring their own beauty
consultants. L'Oreal India has established a consumer advisory unit and Ponds,
as mentioned earlier offers skin care advise through touch-screen kiosks, and
telephone help-lines.
Market Access
Prior to March 31, 1999, India had cosmetics and toiletries on its
restricted list of imports and a special import license was required for import of
cosmetics and toiletries into the country. This regulation has now been done
away with and, India today, permits import of cosmetics and toiletries
without any restrictions. This has made the Indian market more attractive
to foreign cosmetic companies. Imports have been made easier, but not
necessarily cheaper.
The total import duty rate on cosmetics and toiletries classified under
HS Code 33.03 to 33.07 is 39.20 percent, which even though has been scaled
28

down over the past few years is still very much on the higher side. The high
duties cause imports to be price uncompetitive. Certain high - end products just
do not sell in India because the final price to bring it into India is too high for
consumers to pay.

Questioners
1.

Do you Think Lakme provides quality Products to its customers?

Yes

No

2.

Are You Brand Loyal to Lakme?

Yes

No

3.

For Which Purpose you usually use Lakme Products?

Eyes

Lip Colour

Face

Nail Enamel

4.

What do you think about the price level Of Lakme products?

29

High

Optimum

Low
5. If not Lakme , then which other brand?

Revlon

Oriflame

Blue Heaven

LOreal

Lissome

Others
6. Do the Celebrity Endorsements in the Advertisements attract you towards the product ?

o Yes
o No

7. What inspire you to go for Lakme?

o Color/Shades
o Price
o Packaging
o Versatility
o Others
8. What changes you would like to see in the Lakme products?
o More product range
o More shades
o Better packaging
o All of the above

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Q) Do lakme provides Quality Products?

31

Q) Are You Brand Loyal to Lakme?

Q) For what purpose You use lakme products ?

32

Q)What do you think about the price level of Lakme products ?

Q)If not Lakme then which Other brand ?

33

Q) Do celebrity endorsements in advertisements attract

Lakme products ?

Q) What inspire you to go for any cosmetic product?

34

you towards

Q)What changes you would like to see in the Lakme products?

RECOMMENDATIONS
Promotions beyond fashion week
35

 The brand should not lose its focus away from cosmetics. It can proved to very
detrimental.
For vast reach unlikely, in the short-term. Some sort of an alliance or cobranding with the salons that already exist may, perhaps, have been a better
strategy.
The general perception is that company-owned salons are expensive. Though
Lakme beauty salons are reasonably priced, it has not been communicated well
enough.

CONCLUSION

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Since the Null hypothesis is rejected therefore it states that the customers are
not satisfied well with the lakme products . This would be the major cause of
lose of market share in the country. Another reason is the upcoming of
Regional brands in the country that is making lakme loose its sheen. Therefore
the company should take in strategic steps and planning to revive its brand
image accordingly.
The local cosmetics and toiletries market is valued at approximately RM3
billion or about US$800 million, with a growth rate of 13% annually. It is
estimated that there are more than 60,000 types of cosmetic products in the local
market. Imported products from Thailand, the United States, France, Singapore
and Japan dominate the market.
The local cosmetics and toiletries industry generally involves mixing and
formulation processes, using imported ingredients. Many of these companies
are contract manufacturers, mainly for products such as shampoo and
conditioners, other hair care products, perfumes, and cosmetics.
Advertising and promotion is crucial for cosmetics and toiletries products,
in order to create an awareness of new products and build brand loyalty
among consumers. Advertisements in TV and the print media such as
newspaper and magazines, especially womens magazines, are very common.
Samples of toiletries products are distributed to individual households and
products in sachet form are attached to magazines. Free gifts are given during
promotion periods and are advertised in the local major newspapers and on the
web.
According to the industry, the market is saturated with many different types of
products, and in the long run, established brands that emphasize quality and
service will have the edge.
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BIBLIOGRAPHY
Kotler Philip , Keller Lane Kevin marketing , prentice hall of India , 2005

38

 S.P Gupta , Business Statistics, 14th edition , 2005

Business Statistics , J. K Sharma , edition 2005
Tata Mc graw-Hill Edtion , Business research methods , Donald R.Cooper ,
Pamela S. Schindler.

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