SUMMER PROJECT REPORT ON A RESEARCH TO IDENTIFY THE MAJOR FACTORS THAT INFLUENCE THE SALES OF HAIR COLOURS IN THE

PROFESSIONAL SEGMENT FOR

Under the guidance of Mr. Kunal Koushik Category Manager Schwarzkopf Professional, Chennai. Mr. Raja Varatharaju Director, Strategy and Business Development Identiti Design Pvt. Ltd., Chennai

Submitted in partial fulfilment of the requirement for the award of Degree of Master of Business Administration By W. ANNE SHARON Roll No.: 26065

BHARATHIDASAN INSTITUTE OF MANAGEMENT (School of Excellence of Bharathidasan University) TIRUCHIRAPALLI 620014

DECLARATION

I hereby declare that the project report titled A research to identify the major factors that influence the sales of hair colours in the professional segment submitted in the partial fulfilment of the requirement for the award of degree of MBA, is my original work.

This has not been submitted in part or full towards any other degree or diploma.

W. ANNE SHARON ROLL. NO.: 26065

BHARATHIDASAN INSTITUTE OF MANAGEMENT (SCHOOL OF EXCELLENCE OF BHARATHIDASAN UNIVERSITY) TIRUCHIRAPPALLI

ACKNOWLEDGEMENTS

I sincerely thank Mr. Raja Varatharaju, Director-Strategy and Business development, Identity Design Pvt Ltd., for his continuous guidance and moral support throughout the phase of my project. My thanks to Mr. Murali Sundar, General Manager (India), Schwarzkopf Professional for his valuable inputs and feedback for the project. I am very grateful to Mr. Kunal Koushik, Category Manager, Schwarzkopf Professional, for having guided me through every small step in my project. I thank him for having been very supportive of my work and also for providing valuable suggestions which helped to take my project to successful completion.

I also thank the respondents to the survey for having taken time out to help me with my work.

W.ANNE SHARON

CONTENTS:

1. INTRODUCTION 1.1 SCHWARZKOPF CURRENT MARKET SHARE AND ADVERTISING 2. INITIAL PILOT STUDY: RESULTS 3. RESEARCH OBJECTIVE 4. PROJECT SCOPE 4.1 TARGET GROUP 4.2 POPULATION SIZE 4.3 SAMPLE SIZE 5. SAMPLING TECHNIQUE: 5.1 SYSTEMATIC JUDMENTAL SAMPLING 6. TYPE OF RESEARCH: 6.1 EXPLORATORY / QUALITATIVE: 7. RESEARCH METHODOLOGY: 7.1. INTERVIEW THE TARGET GROUPS 7.1.1. HAIR DRESSERS 7.1.2. CONSUMERS 7.2. STUDY IN-SALON ADVERTISING 7.3. TRACK ADVERTISING 8. DISCUSSION AND ANALYSIS: 8.1. HAIRDRESSERS 8.2. CUSTOMERS 8.3. IN-SALON ADVERTISING 9. MARKETING STRATEGY
4

8 9 9

10 10 10

11

11

12 13 13 13

14 20 23

10. QUESTIONNAIRE: 10.1. HAIR DRESSERS 10.2. CONSUMERS 11. LIST OF SALONS SURVEYED: 12. REFERENCES 27 29 30 32

LIST OF TABLES AND FIGURES: TABLES TABLE 1: INITIAL FINDINGS TABLE 2: BRAND AVAILABILITY TABLE 3: CUSTOMER PREFERENCE TABLE 4: REASONS FOR HAIR COLORING TABLE 5: PRICE TABLE 6: HAIR DRESSERS INFLUENCE TABLE 7: BRAND AWARENESS TABLE 8: CONSUMER TOUCHPOINTS TABLE 9: REASONS TO EXPERIMENT WITH NEW BRANDS TABLE 10: MARKETING PLANS FIGURES
FIGURE 1: BRAND POPULARITY FIGURE 2: HAIR DRESSER TRAINING 14 15

9 15 16 18 19 19 20 21 22 25

FIGURE 3: CUSTOMER PREFERENCE FIGURE 4: REASONS FOR HAIR COLOURING FIGURE 5: REASONS TO EXPERIMENT WITH NEW BRANDS FIGURE 6: HAIR DRESSERS INFLUENCE FIGURE 7: SEGMENTATION BREAKDOWN: LOREAL vs. SCHWARZKOPF

16 17 21 22 24

1. INTRODUCTION BACKGROUND: The hair color market in the country is worth around 100 crores and is known to be rapidly growing at a rate of 25% every year. Gone are the days when the predominant reason to color your hair was when it starts to grey. With major advertising campaigns by leading fashion houses in the country and rising acceptance among working professionals, hair color has now become a symbol of ones personality. Several hair color brands including Schwarzkopf, LOreal, Wella, Matrix etc. have cashed in on this trend. Schwarzkopf is the cosmetics brand of multinational company, Henkel. The brand is 112 years old has many innovations and almost 7600 patents to its credit. Schwarzkopf Professional is the in-salon hair care product range and was launched in India in 2001. The business has four verticals namely: 1. Care 2. Form 3. Color 4. Finish The professional hair colors under Color vertical come by the brand names IGORA (IGORA ROYAL, IGORA VIBRANCE, IGORA ROYALE INTENSE, and IGORA ROYALE FASHION+). Igora Royal is the largest selling hair color in the country for Schwarzkopf. It is a permanent hair color well known among the customers for its vibrancy and long lasting nature. IGORA Royal represents a new, total approach to colour products and services, designed from a colourists perspective to bring out quintessential colour talent.

The range includes: IGORA Royal 12- Series IGORA Royal 10- Series IGORA Royal 9.5- Series IGORA Royal Extract E-00 IGORA Royal Extract E-111 IGORA Royal Concentrates IGORA Royal Colourists Colour & Care Developer Base shades - 1-0, 2-0, 3-0, 4-0, 5-0, 5-00 etc.
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These base shades account for more than 50% of the market share for Schwarzkopf.

1.1 SCHWARZKOPF CURRENT MARKET SHARE AND ADVERTISING The market share of SKP currently stands at around 25 crores and growing. Schwarzkopf Professional, being an in-salon brand, is not mass advertised. It caters to the niche market of permanent hair color users in the higher end of the value chain. The product mainly drives its brand awareness through in-salon advertising, offering world-class training to hair dressers through its professional institute ASK (Academy Schwarzkopf) and signing up grade A+ salons across the country as exclusive Schwarzkopf franchisees. Schwarzkopf has also had tie-ups with various salon ranges including Naturals and Lakme at different times to promote their products and also to offer their expertise to other salons. 2. INITIAL PILOT STUDY: RESULTS As the aim of project is to study the existing hair color market, a pilot study was conducted covering 20 A+ grade salons in Chennai, India. The leading hair dressers in each of these parlors were interviewed and their views and perceptions were recorded. It was seen that LOreal dominated the hair color market. Almost 70% of the hair color services done were LOreal. The popular perceptions seemed to be so because of the ubiquitous presence of LOreal as this brand has a large retailing service as well which covers a whole range of cosmetics and toiletries. Thought LOreal does not advertise its in-salon Professional brand just like Schwarzkopf-Professional, the former seems to have the advantage of popular public awareness, aided largely by its retailing products. Schwarzkopf retains its brand image as an exclusive high-end fashion color and lately it seems to be benefitting from increased customer awareness about hair colors in general. As more and more people visit salons these days for hair color services, customer awareness about SKP is definitely increasing. It was also seen that when it comes to choosing a hair color, customers primarily look for testimonials from others users, usually their friends or they look for comments posted in on-line communities. LOreal, having a huge customer base, seems to have an advantage in this area. Also, few people are die-hard fans of the former and would not change to any other brand. But a sizeable chunk of those who walk into parlors do seek the hair dressers advice and also might want to try new brands based on the hair dressers recommendations. All the hair dressers interviewed, do have a very good opinion of Schwarzkopf and said they would definitely recommend it. if the customers asked for it. Hence customers seem to be prime factor to be

influenced, in case of designing a marketing campaign. The following is a brief description of the findings.

TABLE 1 : INITIAL FINDINGS: FACTOR BRAND/S PREDOMINANT USAGE OF SKP PULL FACTOR HAIR DRESSERS (HD) OBSERVATION LOREAL LOW BUT INCREASING CUSTOMERS DEMAND / CUSTOMERS ARE MORE AWARE OF COLORS / BRANDS. LITTLE INFLUENCE NONE / BUT THEY START WITH LOREAL BECAUSE PPL ARE AWARE OF IT GROWING PREFERENCE FOR GRADE 4 AND ABOVE (FASHION COLORS) ALL BRANDS / SAME PRICE FOR COLORING 1. LOREAL 2. SKP 3. WELLA

HD PREFERENCE

COLORS PREFERRED PRICE BRAND USAGE

3. RESEARCH OBJECTIVE: The aim of this study is to understand the existing hair color market and what influences people to choose between different brands of hair colors. Briefly, the following are the objectives of the study. 1. To study the hair color market in the city in terms of predominant brands, customer preference and the dynamics of demand that influence the market share for each brand. 2. To identify the reasons for brand preference (SKP vs others) among consumers and design a pilot in-salon marketing strategy to increase the sales of SKP.

4. PROJECT SCOPE: The project scope is as follows: 1. What influences decisions on hair coloring? a. Reviews from friends / Hair dressers recommendation? b. Magazines / Internet? c. Repeat users / Brand loyalty? A detailed questionnaire is prepared for this purpose which captures the key decision variables of customers for decisions on hair color. The key influencing factors are also studied. Information regarding the frequency of hair coloring, cost factors, quality of each hair color brand and the hair dressers recommendations are also captured through the questionnaire. 2. Construct a customer decision tree to understand the key aspects that drive customers decision on the choice of hair color brands. A customer decision tree is a step-wise procedure taking into account the key influencing factors for a decision by a customer and it helps to identify the key factors in this process which marketers can in turn exploit for designing effective marketing campaigns. 3. Design a pilot in-salon marketing strategy to enhance sales of SKP. 4. Analyze / Evaluate results. 4.1 TARGET GROUP: 1. Hair stylists 2. Consumers 4.2 POPULATION SIZE: 350 4.3 SAMPLE SIZE : 51 Hair Stylists 25 Consumers 5. SAMPLING TECHNIQUE: 5.1 SYSTEMATIC JUDMENTAL SAMPLING: Judgement sampling involves the choice of subjects who are most advantageously placed or in the best position to provide the information required. Purposive sampling is used in cases where the specialty of an
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authority can select a more representative sample that can bring more accurate results than by using other probability sampling techniques. The process involves nothing but purposely handpicking individuals from the population based on the authoritys or the researchers knowledge and judgment.

6. TYPE OF RESEARCH: 6.1 EXPLORATORY / QUALITATIVE: This research focuses on gaining insights into consumer behavior and using it to design a marketing campaign. Hence exploratory research was decided to be best suited for the purpose. Also, since it involves studying perceptions and behavior patterns, it is a qualitative research. Qualitative research is a method of inquiry appropriated in many different academic disciplines, traditionally in the social sciences, but also recently in market research and further contexts. Qualitative research aims to gather an in-depth understanding of human behaviour and the reasons that govern such behaviour. The qualitative method investigates the why and how of decision making, not just what, where, when. Hence, smaller but focused samples are more often needed, rather than large samples.

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7. RESEARCH METHODOLOGY: 7.1. INTERVIEW THE TARGET GROUPS (HAIR DRESSERS AND CONSUMERS) QUESTIONNAIRE DESIGN: Two sets of questionnaires were prepared, one for hairdressers and other for the consumers. Hairdressers were met in person and the various research points (given below) were discussed with them. Among consumers, frequent users of hair colours (both global colouring and streaking) were identified and the same conversational style was adapted to gather data.

7.1.1. HAIR DRESSERS: a) Background: Information about their years of experience, specialisation and training undergone at various hair styling institutes sponsored by Schwarzkopf (ASK Academy Schwarzkopf), LOreal, Matrix, Wella and other private trainers. b) Brand Preference: Their preference for brand/s, if any, and why. c) Availability: Brands available across various A+ grade salons in the city. d) Brand Perception: How do they rate the various brands in terms of quality (shine, conditioning, safety, long lasting), trade discounts, customer demand, their skill in using each of them (as these are professional in-salon brands, each has a certain methodology to be strictly followed for usage. This is very particular to brands and if all the detailed steps are not meticulously followed, then it might not provide the best results as promised by the company. The end result of hair colouring hence is heavily dependent on the expertise of the hair stylist, though the product used is the best in the market. ) e) Customer Preference: Reasons for customers loyalty and preference for particular brands. f) Product Usage: Dyeing / Fashion colouring. g) Technical Details: Following protocols as indicated by the company. h) Advertisements: Market reach each brand achieves in terms of advertisements and general consumer awareness. Since it is an in-salon brand, there is no mass marketing done. The company executives visit individual salons and promote the product. i) Hair dressers influence: Influence of hair dressers in helping customers choose a hair colour brand.
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j)Cost : The cost for hair colouring for various brands and does this effect consumers decision. 7.1.2. CONSUMERS: a) Background: Age, Gender, vocation, frequency of hair colouring. b) Brand Loyalty: Do they prefer any particular brand? If yes, why? c) Brand Awareness: Brands people are aware of, particularly Schwarzkopf. d) Influence on decision making: Where and how is the purchase decision made? (Referrals through friends, consulting hair dressers, reading blogs etc.) e) Complaints: The general problems associated with hair colouring (e.g. hair fall, dryness etc.) and how do the various brands address these. f) Issues: Do they have any serious grievances against any brand? g) Price: The importance of price in making a choice about a particular brand of hair colour. h) Offers and discounts: The attractiveness of offers in enthusing consumers to prefer a particular brand.

7.2. STUDY IN-SALON ADVERTISING: Field visits to salons were undertaken. During these visits, the placement of various advertisements was observed. The advertisements were studied on the following parameters. a. Placement b. Numbers c. Product display d. Shade cards The objective is to study the effect of in-salon advertising on brand decisions by consumers.

7.3. Track advertising by SKP-PROFESSIONAL / LOREAL-PROFESSIONAL The in-salon brands, namely Schwarzkopf-Professional and LOreal Professional are not advertised but the other products by both these companies, namely shampoos, conditioners, moisturizers etc. are widely

13

advertised and available for retail sale as well. These advertisements might have an impact on general brand awareness and consequently, brand preference.

8.1. DISCUSSION AND ANALYSIS: Below is a detailed analysis of each of the parameters in the questionnaire. 8.1.1. Hairdressers: 1. Market Share: LOreal has the highest brand awareness and consequently market share, amongst the hair colour brands. But interestingly, the awareness of Schwarzkopf is steadily increasing. Professional hair colours like LOreal Professional and Schwarzkopf Professional are not mass-advertised. They are promoted and sold directly to the individual salons through company executives.

Brand Popularity
10% 10% 30% Schwarzkopf L'Oreal Matrix 50% Wella

FIGURE 1: BRAND POPULARITY It can be seen that LOreal together with its sister brand Matrix commands a large share (almost 60%) and Schwarzkopf comes second.

2. Availability: LOreal is the brand predominantly available in multi-brand salons both big and small. Multi-brand salons also seem to start off by recommending LOreal (for the uninitiated customer) else they leave the choice to the customers. Multi-brand salons generally had stocks to meet the demand for the various brands.

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Brands available in salons:

Schwarzkopf L'Oreal Matrix Wella

70% 81% 36% 34%

TABLE 2 : BRAND AVAILABILITY

3. Hair Dresser Training: An important step in professional hair colour use is hair dresser training. Each brand has its own colouring protocols which must be strictly adhered to. Hair dressers should be adequately and frequently trained by individual companies for their respective brands. These colours, if not properly used, may lead to problems like early washout of the colour, less than satisfactory shine and finish and ultimately falling popularity for the brand. The expertise that hair dressers have with different brands also seems to have some influence on their recommendations to their customers.

Hair Dresser Training - Best Brand

30% Schwarzkopf L'Oreal 70%

FIGURE 2 : HAIR DRESSER TRAINING

If a customer walks in and asks for Brand A and if the hair dresser is not very comfortable with the usage of Brand A, it is likely that he/she will try to convince the customer to use Brand B which the hair dresser is an
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expert at. Hair dressers generally do not wish to experiment on their customers as their salons popularity is at stake, for having a bad hair day, literally, is an extremely depressing experience, especially for female customers. LOreal seems to be the brand of choice as far as training hair dressers is concerned. The owner of one salon in Velachery, concurred that LOreal was very aggressive in extending their training facilities even smaller salons. And as LOreal is very well known among customers as well, hair dressers find it easier to sell LOreal to most first time users than Schwarzkopf, especially in multi-brand salons. In terms of quality, all the hair dressers rated both the brands equally. (Some were of the opinion that Matrix is too strong on the hair, but LOreal, Schwarzkopf and Wella were ranked at the same level)

3. Customer Preference. Hair dressers opine that the trend towards deciding hair colours is changing. Customers these days are increasing aware of the various brands in the market, and given sufficient encouragement, are eager to try out new brands as well. How do people make a choice about hair colours?

FIGURE 3: CUSTOMER PREFERENCE

Ask for particular hair colour brands Take hairdressers' advice to make a final decision

77% 85%

TABLE 3: CUSTOMER PREFERENCE

The above showed that customers had an almost equal say in deciding on hair colour brand.

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Hair dressers also say that almost 50% of their customers are die-hard fans of LOreal and they would not shift brand for any reason under the sun. Also, on an average LOreal seems to make up to almost 6-7 of every 10 hair colour tubes (including Matrix, 5-LOreal, 2-Matrix) used in the salons. Sales Data (For every 10 tubes of hair colour used) LOreal Schwarzkopf : 6-7 : 2-3

But the remaining is a highly impressionable crowd and though they have an initial gravitation towards LOreal, an increasing number among them are now seeking advice on other brands including Schwarzkopf.

4. Product Usage: Traditionally, hair colouring was predominantly used for grey hair coverage. And users were generally in the age group of 40 and above. But these days, hair colouring as a funky fashion add-on is fast catching up. More and more people these days like to be seen with not only artistic hair dos but also with exquisitely coloured hair. As a result, the so called fashion colours (non-black shades with grade 4 and above - The shade card has colours ranging from 1 to 12 or 13 and darker shades have lower grades) are widely used now.

FIGURE 4: REASONS FOR HAIR COLOURING

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Grey Coverage

67%

Fashion Colouring

92%

People with grey hair are increasingly opting for fashion colouring than the dyeing black

19%

TABLE 4 : REASONS FOR HAIR COLORING The popular grades these days seem to be 4, 5 and 6 (Shades of red and brown). These colours cost approximately Rs.50/tube more than the normal black ones (approx. Rs.340/tube for fashion colours and Rs.280/tube for black shades, for LOreal) 5. Technical details: One important part of professional hair colour usage is strictly following the protocol, as mentioned previously. The developers used for the colours should be of the same brand. Else the colour will not produce the desired finish. A few salons where there were customer complaints of early washout of colour said one of the reasons was the wrong developer being used. This was due to unavailability of stock. It is not sure as of now as to in how many salons this problem exists but it is definitely prevalent in a few. Hair dressers say that salons are forced to do this due to lack of proper stock and is usually not done for any other purpose(like better deals, extra free samples etc.) This problem needs a little more research before a conclusion can be reached. 6. Complaints and Issues: Hair dressers do not seem to have any complaints or issues with any brand per se. They also say that they generally do not get any monetary incentives from companies for using particular brands. (Except for a few one-off events conducted where hair dressers were awarded based on the number of colour tubes used. Eg. One at Naturals, Shanthi Colony, Annanagar)

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7. Price Multi-brand salons price hair colouring services for all brands at the same rate. The price is usually between Rs.950 and Rs.1250 (VLCC is the most expensive at Rs.1500) for every tube of colour used. Touch-ups done a few months after the hair colouring are also charged at the same price. Hence price is not a factor for the customer to decide on a brand of hair colour. Brand Cost per colouring service (using one tube) Schwarzkopf LOreal Wella Matrix Rs. 1000 Rs.1200 Rs. 950 Rs. 1300 Rs. 950 Rs. 1300 Rs. 950 Rs. 1100 Rs. 500 Rs. 600 Rs. 450 Rs. 600 Rs. 450 Rs. 600 Rs. 450 Rs. 550 Cost per touch-up service

TABLE 5: PRICE 8. Hair dressers role in influencing customers. For first time hair colour users, hair dressers are definitely very strong influencers for choosing a hair colour. Also for people who use traditional substances like henna to colour their hair and those who have hair fall or other scalp related problems also consult hair dressers for deciding on the brand of hair colour. Brand Schwarzkopf L'Oreal Matrix Wella [%] of hairdressers recommending the brand 42% 75% 11% 14%

TABLE 6: HAIR DRESSERS INFLUENCE

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Brand
80% 60% 40% 20% 0%

Brand Schwarz Matrix L'Oreal Wella

Hair dressers opine there is no particular brand that would be especially suitable for these particular cases. All brands seem to have identical advantages and disadvantages (like coloured hair, if not maintained properly, turns rough and frizzy). In times like these, factors like hair dressers expertise with using particular brands, availability and popular brand perception play a very important role in decision making.

8.1.2. Customers: 1. Brand Loyalty and Awareness: Both the brands (LOreal and Schwarzkopf) have brand loyalists, though the numbers are in favour of the former. Brand awareness about Schwarzkopf is increasing, as mentioned earlier. Given that almost 50% of the salon customers for hair colour are an impressionable crowd who seek hair dressers advice, focussing on improving brand awareness among the customers would be very helpful in brand building. Brand Awareness:

Schwarzkopf L'Oreal Wella

80% 90% 50%

TABLE 7 : BRAND AWARENESS

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The consumers, once they find a particular brand exceptionally appealing, seem to become strong loyalists for that brand, as is seen in the case of LOreal. Hence brand churn seems to be very less for hair colours. Hence efforts to improve brand loyalty and awareness among the consumers would be a worthy investment with long term gains. 2. How do consumers know about various hair color brands. Visuals seem to be a very strong factor in building the appeal of hair colours. (As seen in the official websites, the exquisite colour charts, in-salon advertisements and other ads in magazines). People who seem to like the hair colours used by their friends / relatives are more likely to go for that same brand than others who have not had such interactions. Hence word of mouth advertising seems very strong here.
Ask Hair dressers' opinion Friends Read reviews online and in magazines 70% 70% 20%

TABLE 8 : CONSUMER TOUCHPOINTS Mode of decision making Proportion of people

Demand for a particular hair colour brand Ask for hair dressers opinion only Have a particular preference for a brand and ask hair dressers opinion too

18%

12% 70%

3. Reasons to experiment with new brands. A number of reasons would prompt customers to experiment with new brands. The following main reasons were identified and studied. 1. Free samples
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2. In salon visuals 3. Hair stylists recommendation 4. Friends 5. Others (like reviews in media etc.)

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The following is the summary of the findings.

FIGURE 5: REASONS TO EXPERIMENT WITH NEW BRANDS It is seen that the peer groups play a major role in spreading awareness regarding new trends and brands and is one of the main reasons people experiment with brands. Free samples and hair stylists recommendations come second in this order. (TABLE 9)

Free Samples In-salon visuals Hair stylists' recommendation Friends Others

68% 8% 28% 60% 8%

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Hair dressers influence as considered by customers when making a decision: Scale : 1 - Least influence 5 - Most influence.

FIGURE 6: HAIR DRESSERS INFLUENCE It is noted from the above histogram that hairdressers role in influencing peoples decisions is moderate. It does not come out at the most important factor in decision making.

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4. Price As mentioned earlier, in multi-brand salons, price does not seem to influence brand decisions.

4. Complaints / Issues. None, as of now, that were brand specific. All were just the usual problems associated with hair colouring. 8.1.3. IN-SALON ADVERTISING: In-salon advertising is the only direct advertising to the customers in case of hair salon brands. LOreal has brand awareness otherwise as well because of the thrust provided by its exhaustive retail range of products like cosmetics, shampoos, perfumes, conditioners etc. (but Schwarzkopf BonaCure Shampoos are ranked as the BEST in the market by both hair dressers and consumers) 1. Placement In multi-brand salons, all the brands have equal advertising space. There are usually large ads on the walls for all brands, placed alternatively. People usually paid attention to these mostly when: a. They were waiting for their turn for a service at the salon. b. When they were at the billing counter. c. When they had accompanied their friend/relatives and were waiting for them. It must be noted that there is waiting time in the salons mostly during weekends only. In-salons advertisements are a means of telling the customer the availability of a particular product or any new offers. In this way, they are definitely a necessity but do not have much of an influential role unless backed by other factors like usage in a peer group, a promotional activity, hair dressers recommendation etc. Also, couple of salons had Schwarzkopf logo as part of their sign boards (Cuts and Curls, Kilpauk and Raj Grover, Nungambakkam) but had almost no stock of SKP. 2. Numbers/Shade cards/ Display Shelves: No particular influence by these factors.

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FIGURE 7: SEGMENTATION BREAKDOWN: LOREAL vs. SCHWARZKOPF

LOREAL:

Target Market

Aware

Unaware

Tried Rejector Not repeated Repeated Negative Opinion

Not Tried Favourable Opinion

Neutral

SCHWARZKOPF:

Target Market

Aware

Unaware

Tried Not repeated Negative Opinion

Not Tried

Rejector

Repeated

Neutral

Favourable Opinion

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9. MARKETING STRATEGY: From the findings above it can be noted that consumers are increasingly becoming the decision makers. Hence a customer-centric initiative must be designed to boost sales. Four strategies were designed and tested with the consumers. Short term strategies 1. One free hair color service 2. Gift Coupons for other hair salon services like haircuts, etc. Long term strategies: 1. A computerized system which takes in the customers profile photo and displays the various hair colours on it. This will enable the customers to see and decide first hand on the choice of colour. The colour palette will have exclusive Schwarzkopf colours only. 2. A one-year package with 2 colour services and 1 touchup service. The first two of these will have a particular discount. The following are the results:

One free hair colour service A one-year package with 2 colour services and 1 touchup service. The first two of these will have a particular discount. Display systems which use your photo to show you in-system images of various hair colours so you can choose which one looks best on you, in real time. A colour service with a free fixed rate coupon to avail any other regular salon service of choice.

72% 12% 10% 28%

TABLE 10: MARKETING PLANS Consumers seem to prefer one short term initiative to try a different brand of hair colour. A activity can be designed as follows.

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STRATEGY DESIGN:

A visual at the door of the salon announcing the new offer. This would help to get the consumers attention

The hair dresser must ensure that a consumer who has come for a hair colour service is aware of the offer.

Once the consumer decides to opt for it, he/she must be given a flyer/leaflet which details the offer available.

Consumer data like phone number and email ID can be collected to track their satisfaction levels with the product.

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10. QUESTIONNAIRE: 10.1. HAIR DRESSERS: PARLOR NAME: AREA: CATEGORY:

1. Why do people generally color their hair for? [Check Box] a. Grey Coverage b. Fashion coloring c. People with grey hair are now increasingly opting for fashion colors. 2. Brands available in the salons.[Check Box] a. Schwarzkopf b. LOreal c. Matrix d. Wella 3. Based on training, how would you rate the various brands? a. Schwarzkopf b. LOreal c. Matrix d. Wella 4. How do people make a decision about hair colors? [Check Box] a. Ask for the hairdressers opinion only b. Ask for a particular hair color brand. c. Both of the above. 5. Which brand would you recommend strongly to customers? a. Schwarzkopf b. LOreal
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c. Matrix d. Wella 6. Are customers increasing aware of hair color brands and the technicalities of hair color these days? a. Yes b. No 7. How many hair color services does your salon do in a month? a. 5-10 b. 10-15 c. 15 and above

8. What is the cost for each of the brands? How much does a touch-up service cost? 9. Is there any technical problem with any of the products? (e.g. Does not last long, shine not to the desirable extent etc.)

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10.2. CONSUMERS NAME: AGE: GENDER: VOCATION:

1. What brands in the in-salon professional hair color category are you aware of? a. Schwarzkopf b. LOreal c. Matrix d. Wella 2. How often do you color your hair? a. Once a year b. Twice a year c. More than twice a year 3. Which brands have you used so far? a. Schwarzkopf b. LOreal c. Matrix d. Wella 4. How do you decide on a hair color brand? a. Ask hair dressers opinion b. Consult friends c. Read reviews online and in magazines d. In-salon visuals 5. What would prompt you to try new hair color brand? a. Free samples b. In-Salon visuals
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c. Hair stylists recommendations d. Friends e. Others 6. On a scale of 1-5, how much weightage would you give to hair dressers recommendation? 7. Is price a deciding factor for choosing a hair color? a. Yes b. No

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11. LIST OF SALONS SURVEYED:

1 2 3 4 5 6 7 8 9

Green Trends, Parrys Pearls, Santhome Bounce CutitOut Naturals', Spencers Plaza Bounce Style Lounge LimeLite, Nungambakkam Naturals, Nungambakkam RajGrover

18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34

Glos Talwalkars Chillbreeze, Spencers Cuts and Curls GreenTrends, Kipauk HairCraft Naturals, Kilpauk Eve's , Nungambakkam Chang's Kilpauk Lakme, Kilpauk Vedha's, Kilpauk Naturals Mens Zone, Kodambakkam Style Catchers, Kilpauk Naturals, velachery Tribez Studio Profile Adyar

35 Naturals, AnnaNagar 36 Lakme Adyar 37 Josie 38 Dollys Kilpauk 39 Sameena Kilpauk 40 Lakme nungambakkam 41 Eve college road 42 Eves Choolai 43 Shanaz Purasaiwalkam 44 Lakme Tambaram 45 Femina and groomz tambaram 46 Green Trends Tambaram 47 Lakme Tnagar 48 Eve's Vepery 49 Alima Mcity 50 Klapp Beauty, Hyderabad 51 Naturals, Chrompet

Studio Essentials, Nungambakkam 10 Femina and Groomz 11 VLCC 12 Naturals, Adyar 13 Anushka 14 ChillBreeze 15 Femina and groomz, Ashok nagar 16 Green Trends Adyar 17 Eve's, Adyar

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REFERENCES

1. RESEARCH BRIEF PROVIDED BY SCHWARZKOPF 2. WEBSITES:

http://www.indiaretailing.com/ www. fashionindustrynetwork.com www.schwarzkopf.com www.schwarzkopf-professional.com http://www.111.schwarzkopf.com/ http://en.ask-schwarzkopf.com/ http://www.schwarzkopfpalette.com/ http://www.henkel-india.com http://www.henkel.com www.thehindubusinessline.com

3. PHILIP KOTLER ET AL., MARKETING MANAGEMENT

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