Table of Contents

As of 2008, the size of the Asian hair colourant market represents approximately 14.13% of the global market (Euromonitor International 2010).

1.2 Market Share

Kao holds 8.19% of the Asia Pacific hair colourant market in 2008 (Euromonitor International 2010).

Liese Bubble Hair Color (LBHC) was launched in Singapore in July 2009, thus it can be expected that the market position of this product is comparatively lower than the established hair colourant brands in the market as consumers need some time to gain confidence in the product.

1.4 Breadth and Depth of Product Range

According to Bentancourt (2006), breadth of product range is the number of product lines or categories that a brand carries and depth is identified as the number of varieties within a product line or category.

Kao carries a variety of products which ranges from beauty care, to human health care, to fabric and home care (Kao Corporation 2010). The list of products that Kao Singapore carries under each category is provided in Table 1.1.

Table 1.1: Breadth of Kao’s products

Beauty Care	Human Health Care	Fabric and Home Care
· Facial care products · Body care products · Hair care products · Hair colouring products	· Sanitary products	· Fabric care products · Kitchen cleaning products · Household cleaning products

(Kao Corporation 2010)

Under each product line, Kao carries a variety of products as listed in Table 1.2.

Table 1.2: Depth of Kao’s products

Beauty Care
Facial care products	· Facial cleansing · UV protection · Pore pack · Makeup remover
Body care products	· Soap · Powder sheets · Moisturisers · Body deodorant sheets
Hair care products	· Shampoo and conditioner · Treatment · Hair styling · Hair care
Hair colouring products	· Hair colour
Human Health Care
Sanitary products	· Napkin · Pantyliner
Fabric and Home Care
Fabric care products	· Laundry bleach · Liquid detergent · Powder detergent
Household cleaning products	· Wiper range · Floor cleaners · Bathroom and toilet cleaners
Kitchen cleaning products	· Kitchen and glass cleaners · Kitchen bleach

(Kao Corporation 2010)

1.5 Company’s Principal Products

The principal products of Kao are its skin care products (Euromonitor International 2010) as shown in Table 1.3.

Table 1.3: Principal Products

	Features and Benefits
Facial Cleansers	· Consist of products for both men and women · Caters for different skin types – e.g. normal, sensitive and oily skin · Consist of facial foam, scrub and sheets (Kao Corporation 2010)
Makeup Remover	· Comes in different forms – e.g. Cleansing sheets, oil and gel · Comes in both oily and non-oily formula · Consist of products that are suitable for both face and waterproof eye make-up (Kao Corporation 2010)
UV Protection	· Consist of products that gives different effects – e.g. matt and radiant · Consist of product which comes with moisturising formula · Consist of product for both face and body (Kao Corporation 2010)
Pore Pack	· Caters for both men and women (Kao Corporation 2010)

1.6 Positioning of Product

From its packaging and advertisements, it is evident that Kao is trying to position LBHC as a young and innovative hair colourant product.

1.7 Product Life Cycle Stage

Figure 1.1: Product life cycle stage

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Source: QuickMBA 2007, Marketing: The Product Life Cycle, viewed 20^th March 2010, <http://www.quickmba.com/marketing/product/lifecycle/>.

LBHC is considered to be currently at the early growth phase, as indicated in Figure 1.1, seeking to build a brand preference so as to gain more market shares. This is evident in the expansion of its distribution channels to include major supermarkets on top of personal care stores and the engagement of intense television advertisements to reach a broader audience.

2 Competitors

2.1 Number of Direct/Indirect Competitors

2.1.1 Direct Competitors

Being a personal Do-It-Yourself (DIY) hair colorant, LBHC (Illustration 2.1) has a significant number of direct and indirect competitors with its main direct competitor as Hoyu Beauteen (Illustration 2.2). Although both products adopt different price positioning, both share substantial similarities as shown in Table 2.1.

Illustration 2.1: Liese Bubble Hair Colour

Source: Kao 2010, Liese Bubble Hair Color, Kao Corporation, Singapore, viewed 23^rd March 2010, <http://www.kao.com/sg/web/news_files/Liese_Bubble_Hair_Color.html>.

Illustration 2.2: Hoyu Beauteen

Source: Hoyu 2010, Characters, Hoyu, Singapore, viewed 23^rd March 2010, <http://www.hoyu.com.sg/Beauteen/>.

Table 2.1: Similarities between Liese Bubble Hair Colour and Hoyu Beauteen

Both products contain Japanese brand headings and descriptions
Both products uses young female Japanese characters in the package. LBHC uses real life Japanese models while Beauteen uses Japanese anime characters
Both products uses a colorful, trendy packaging design

2.1.2 Indirect Competitors

LBHC’s indirect competitors are shown in Table 2.2. These products target different target segments or they differed in cost positioning.

Table 2.2: Indirect competitors

L’Oréal Casting Crème Gloss	L’Oréal Excellence Crème	Garnier Nutrisse Cream	Revlon Coloursilk

Hoyu Bigen Prominous Colour	Hoyu Bigen Silk Touch	Hoyun Bigen Speedy Hair Colour	Schwarzkopf Palette Deluxe

2.2 Size of competitors

From Table 2.3, it is evident that L'Oréal is the leading brand in the hair care industry in Singapore with a 21.6% value share in 2008. Since its entrance in 2006, Hoyu, has been steadily growing its market share to 3.2% value share in 2008. In the same period, Revlon also managed to gain a 2.2% value share.

Table 2.3: Market shares

Hair Care Company Shares by Retail Value 2004-2008
% retail value rsp	2004	2005	2006	2007	2008

L'Oréal (S) Pte Ltd	19.4	19.2	19.8	20.9	21.6
Unilever Singapore Pte Ltd	14.7	16.1	17.8	17.9	17.0
Procter & Gamble (S) Pte Ltd	20.7	20.1	18.7	16.9	15.9
Mandom Corp (S) Pte Ltd	3.7	6.0	6.3	6.6	6.7
Kao (S) Pte Ltd	2.5	2.0	2.6	4.4	5.6
Hoyu Singapore Pte Ltd	-	-	2.9	3.0	3.2
Revlon Inc	1.4	1.7	2.1	2.3	2.2
Body Shop (S) Pte Ltd, The	2.6	2.1	2.1	1.9	2.0
Henkel KGaA	2.0	1.8	1.8	1.6	1.4
Nu Skin Enterprises Singapore Pte Ltd	1.0	0.9	0.6	0.8	0.8
Tohtonku (S) Pte Ltd	1.0	0.9	0.7	0.7	0.7
Way Co Pte Ltd	0.7	0.6	0.6	0.6	0.6
Colgate-Palmolive Eastern Pte Ltd	0.4	0.4	0.4	0.7	0.6
Amway (S) Pte Ltd	0.3	0.3	0.3	0.4	0.5
Sara Lee Singapore Pte Ltd	0.7	0.7	0.6	0.5	0.4
Kosé Singapore Pte Ltd	0.2	0.2	0.2	0.2	0.2
Johnson & Johnson Pte Ltd	0.3	0.2	0.1	0.1	0.1
Shiseido (S) Co Pte Ltd	0.6	0.1	0.1	0.1	0.1
Combe Inc	0.1	0.1	0.1	0.1	0.1
Lion Corp (S) Pte Ltd	-	0.2	0.3	0.3	-
Reckitt Benckiser (S) Pte Ltd	0.5	0.5	0.4	-	-
Hoyu Co Ltd	3.4	3.0	-	-	-
Wella AG	-	-	-	-	-
Clarins Pte Ltd	-	-	-	-	-
Private Label	1.1	1.0	0.9	0.9	1.0
Others	22.6	22.0	20.5	19.2	19.5
Total	100.0	100.0	100.0	100.0	100.0

Source: Euromonitor International 2010, Hair Care Singapore, Chicago, viewed 20 March 2010, <http://www.portal.euromonitor.com.ezproxy.lib.rmit.edu.au/Portal/ResultsList.aspx>.

2.3 Positioning

2.3.1 Low cost positioning

At a price of $19.90, LBHC positions itself as a high cost product as it is comparatively more expensive than the other hair colourants. Figure 2.1 shows the detailed illustration of hair colourants’ prices.

Figure 2.1: Prices of hair colourants

Sources: Prices are taken from stores such as NTUC, Guardian and Watsons.

L’Oréal’s hair colourants have prices ranging from $11.10 to $18.90 with the Casting Crème Gloss as its most expensive product. L'Oréal which owns Garnier has a strategy to evolve Garnier into a mass consumer brand, engaging in low costs positioning (AllBusiness 2010). One of such product is Garnier’s Nutrisse Cream which is priced of $11.10.

Similarly, Hoyu’s hair colorants also have a range of high and low cost products. Bigen Prominous Colour is considered a high cost product while Bigen SilkTouch and Beauteen are positioned as low cost hair colourants. Schwarzkopf portrays its Palette Deluxe as a low cost hair colourant by pricing it as the cheapest in the market. Table 2.4 below summarises the positioning of the firms and their products.

Table 2.4: Positioning of firms and products

	High Cost Positioning	Low Cost Positioning
Kao	· Liese Bubble Hair Color	NIL
L’Oréal	· Casting Crème Gloss · Excellence Crème	· Garnier’s Nutrisse Cream
Hoyu	· Bigen Prominous Color	· Bigen SilkTouch · Beauteen
Schwarzkopf	NIL	· Palette Deluxe

2.3.2 Niche players

Kao has also produced flagship products for each of the markets which it has a niche in. However, Kao is new in the hair colourant market and has positioned LBHC as an innovative product.

On the other hand, Hoyu has been in the hair colourant market since its inception and has grown to become a trend leader (Hoyu 2010) which possesses the largest market share in Japan and is also one of the leading providers of hair colourants around the world. With its specialisation and competencies in producing hair colourants, Hoyu has carved our a niche in the industry.

L'Oréal is the global leader that specialises in 5 markets - hair care, hair colour, skin care, make-up and fragrances (Savh 2010). Utilising cutting-edge technolog, L'Oréal has produced flagship products in each of these markets that answers all beauty needs. Focusing on high-growth market in Asia, L'Oréal achieved 15% of its total sales from its hair colourants in 2008. Hence, L'Oréal is a niche player in the hair colourant industry as it contributes significantly to its profits.

3 Identification of Target Market(s)

3.1 Liese Bubble Hair Colour

Illustration 3.1: Liese Bubble Hair Colour

Source: Kao 2009, LBHC, Kao Corporation, Singapore, viewed 2nd March 2010, <http://www.kao.com/sg/web/news_files/Liese_Bubble_Hair_Color.html>.

3.1.1 Primary Target Market

Kao first entered the hair colourant market segment in July 2009 through the release of the LBHC (Kao 2009). Its primary target market is generally young females, as suggested by the featuring of young females in their advertisements and product packaging. As the product features a revolutionary ‘foaming’ technology, it appeals especially to ladies who prefer a simple and fuss-free DIY hair colouring experience.

3.1.1.1 Demographics

The target group consists of women between 16 to 31 years of age who can and are interested in dyeing their hair. At a price of $19.90, there are no fixed social classes defined for this product as most within the target group would be able to afford it.

3.1.1.2 Psychographics

LBHC features young women in all of its marketing efforts to portray a youthful image of its users. Through a unique naming convention for the products’ various colour choices (e.g. Sweet Pink, Chiffon Beige, Milk Tea Brown), Liese attempts to inject vibrance and style to its product selection. Thus, it appeals not only to teenagers, but also young working class individuals.

3.1.1.3 Behavioural

LBHC seeks to attract existing, potential and non-users of DIY hair colourants with its innovative application method which removes inconveniences such as applying hair dye in sections and brings benefits like evenly coloured hair.

3.1.1.4 Potential Market Segment

Identification of potential market segments is essential to the sustained growth of a company. For the LBHC, we recommend entering the DIY hair colouring for teenage males. The men’s grooming industry is worth $26 billion globally, and this total is still rising. Men want products that make them feel and look good (Falk 2009), hair colour would help them achieve that.

3.2 Hoyu Beauteen

Illustration 3.2: Hoyu Beauteen

Source: Beauteen 2010, Product Line Up, Beauteen, Japan, viewed 13th March 2010, <http://www.beauteen.jp/lineup.html>.

3.2.1 Primary Target Market

Beauteen from Hoyu, has been identified as the direct competitor of LBHC. Its primary target market are teenagers (Aichi Quality 2010), according to Mabel Yeo (Channelnewsasia 2007), Hoyu Singapore’s marketing manager, “We want to make our products more fun and engaging for young customers.”

3.2.1.1 Demographics

Beauteen is targeted at teenagers aged 16 to late 20s, both male (Men’s Beauteen) and female (Beauteen). Priced at $10.90 in all major stores, it is an affordable option to its target group who generally have lower spending power.

3.2.1.2 Psychographic

The product packaging features anime characters (Illustration 3.3), and each of them comes with a profile, including details such as obsession and ambition (Hoyu 2010). Through this, Hoyu attempts to segment the target group into a collection of lifestyles.

Illustration 3.3: Anime characters on Hoyu Beauteen’s packaging

Source: Hoyu 2010, Characters, Mensbeauteen, Singapore, viewed 13th March 2010, <http://www.mensbeauteen.com.sg/>.

3.2.1.3 Behavioural

The target market can also be segmented by the different benefits consumers seek. Beauteen features a triple component defence which protects the hair while ensuring neat and even colour, resulting in glossy and smooth hair (Hoyu 2010). This would appeal to users who are looking out for colourants which offers hair protection and deliver evenly coloured hair.

3.2.1.4 Potential Market Segments

A potential market segment which applies to Beauteen is the Generation X; aged between 29 – 46 years old. As these individuals are usually working class and lead a busy lifestyle, hair colour products that are marketed to this segment may carry attributes like ease of application, shorter waiting time and colour selections which are suitable for the workplace.

4 External Influences

4.1 Culture and Subculture

Singapore is a cosmopolitan society which still practices traditional values. The society is more inclined towards collective values of conformity and cooperation, rather than being individualistic. The desire for new challenges and change is also reflected in the majority population with almost 69% depicting a positive inclination towards facing challenges, changes and innovation (Ah & Yang 1991). LBHC, being an innovative product in which the usage method totally differs from any traditional hair dye, appeals especially to the group of early adopters whose age range from 16 to 31 years old. These adopters are very knowledgeable about products as they are familiar with marketing campaigns, and they also tend to share their opinions on the product with their groups of friends. They like things that are innovative but dislike repulsive messages.

4.2 Demographics

Given that the target market of LBHC is from Generation Y, they tend to have greater spending power and are attracted to new technology, style and new products (Kane 2009).

As for gender influence, it is likely that the majority of the consumers of LBHC are females because female constantly pursue beauty and hair colourants is a means of enhancing beauty.

Socioeconomic factors include education, income, type of occupation, place of residence, and could also refer to heritage and religion (NCREL 2009).

Given that LBHC is considered relatively inexpensive, it is given that the consumer need not be one that is earning well. LBHC is also not affected by religion as the only religion which has restrictions on hair dyeing is Muslims. Even so, the only colour which Muslims are prohibited from dyeing is black, a colour which LBHC does not produce (Ibn Adam & Iftaa 2009).

4.3 Group influence

Regarding the group influence of LBHC, we feel that there are three types of influence namely informational, normative and identification.

Informational influence is when individuals gather information from surrounding groups in order to make purchases. For example, Mandy is considering to buy a hair dye, but is unsure of which one to buy. Mandy’s friends recommended her LBHC because they have tried the product. Eventually, Mandy decides to buy LBHC after receiving this information from her friends.

Normative influence is also known as utilitarian influence. For example, although Mandy notices that a number of her friends use LBHC; she could not tell the difference in terms of the end results. However, the next time she decides to purchase a hair colourant, she will choose LBHC.

Identification influence is when Mandy notices that a lot of young and fashionable individuals use LBHC. She begins to feel that it is symbolic for young fashionable individuals to use LBHC. Thus, being a young fashionable individual herself, she will purchase LBHC.

5 Internal Influences

5.1 Needs and Motives

Figure 5.1: Maslow’s Hierarchy of Needs Model

Source: Finkelstein, J 2008, Lest We Forget Maslow, viewed 18^th March 2010, <http://www.elasticmind.ca/innerpreneur/wp-content/uploads/2008/10/MaslowHeirarchyNeeds.jpg>.

5.1.1 Physiological

As described by Maslow (1943), physiological needs are biological needs, which include food, water and sleep. Hair colourants do not fulfil these basic needs but as suggested by the hierarchy, physiological needs have to be fulfilled before individuals seek higher levels of needs. Being a first-world country, it is safe to say that most of Singapore’s population has progressed beyond thoughts and behaviours associated with physiological needs and are seeking higher level of needs.

5.1.2 Safety

When physiological needs have been met, people would want to take care of safety needs. This is translated into consumer behaviour as they would examine the possible safety implications involved with using a product. This is especially so for hair colourants as they contain chemicals which are harmful to the body. Liese has identified and met this need by providing equipment to avoid contact with the colorant, safety instructions and also a “Q&A” section on its website to clarify various doubts consumers might have with regards to usage (Kao 2010).

5.1.3 Love/ Belonging

This refers to our desire to feel loved and to belong to certain groups (Morningstar Multimedia LLC 2008). Consumers are largely influenced by their peer groups when making purchase decisions, if surrounding friends and family have used LBHC, they may be compelled to use it. Liese established a section within its product website which documents “First Experiences” of individuals in its target demographics, to match the product to certain social groups.

5.1.4 Self Esteem

Self esteem needs include factors such as recognition and reputation (12Manage 2010). Being an innovative and relatively new product, LBHC is able to fulfil this need as consumers who adopt this product may be regarded as trend leaders who are adventurous and daring. As it is priced above the average price of hair colourants, users may be recognised as a niche class among the hair colourant consumers.

5.1.5 Self-actualisation

Maslow describes this need as the desire to become everything one is capable of becoming (Maslow 1954). For example, an individual may have a strong desire to be more beautiful. As shown in the advertisement below, marketers of LBHC have suggested that women can become beautiful through a simple 3 step process as illustrated in Illustration 5.1 below.

Illustration 5.1: 3 steps process

Source: Kao 2010, Products, Kao Corporation, Singapore, viewed 23rd March 2010, <http://web.kao.com/sg/liese/product/haircolor/products.html>.

5.2 Perception

Perception involves a series of interlinked activities by which stimuli are transformed into information and stored (Quester et al. 2007). This constitutes three stages, exposure, attention and interpretation.

5.2.1 Exposure

Exposure occurs when a product stimulus is received through the consumer’s sensory receptor nerves (Neal 2004). Kao invests a large amount on advertising such as television commercials, product website, posters at bus stops and bus advertisements. The variety of advertising channels used is for the purpose of maximising the exposure of this product.

5.2.2 Attention

Attention occurs when a certain product catches a consumer’s interest, this is when consumers will then find out more of the product (Schiffman 1994). To grab the attention of consumers, advertisements for LBHC often features bright colours such as pink, red and orange. It also utilises a straightforward presentation where its features and benefits are clearly stated in compressed messages to the audience (Illustration 5.2).

Illustration 5.2: Features and benefits

Source: Kao 2010, LBHC, Kao Corporation, Singapore, viewed 23rd March 2010, <http://web.kao.com/sg/liese/product/haircolor/index.html>.

5.2.3 Interpretation

Interpretation is the organisation of information in order to assign meaning to sensations (Mowen & Minor 2001) which involves a cognitive and an affective response.

Cognitive interpretation is a process whereby stimuli are placed in existing categories of meaning (Mowen & Minor 2001). When LBHC was first introduced, consumers would most likely group it with other hair colorants in order to be able to evaluate it. But with further experience and information, consumers would gain detailed knowledge about the product and differentiate it from existing products.

For affective interpretation, it is the emotional or feeling response triggered by a stimulus such as an advertisement. In its television commercial, LBHC features a foam animated character and a relaxing mood which evokes feelings of fun and youthfulness.

5.3 Learning

Cognitive learning through reasoning has been identified as the most relevant theory to be used in promoting an innovative hair colourant like LBHC. In this process, individuals employ thinking to restructure and recombine existing information and new information to form new associations and concepts (Quester et al. 2007). As LBHC employs a new application method which is totally different from contemporary means, it creates a new thinking process for consumers as they weigh the different aspects of the product with existing products when they make purchase decisions. Through this thinking, consumers may associate convenience to the bubble application method and inconvenience to contemporary ways.

5.4 Lifestyle

Lifestyle is defined as the attitudes, tastes, habits, moral standards and economic level that together constitute the mode of living of an individual (Solomon 2007). As mentioned earlier, the target group of LBHC are young women aged 16 – 31. LBHC’s range of colours appeals to the different tastes and attitudes of consumers within the target group and they have provided “Expert Advise” to match the colours to different personalities (Illustration 5.3).

Illustration 5.3: Expert advice

Source: Kao 2010, Products, Kao Corporation, Singapore, viewed 23rd March 2010, <http://web.kao.com/sg/liese/product/haircolor/products.html>.

However, this does not mean that consumers who do not belong to this group are not suited to use the product. For example, a middle-aged career woman would be living a drastically different lifestyle from the target group, and thus place different priorities on the benefits the product can provide. She might have a greater preference for convenience of use rather than brand popularity, due to her busy lifestyle.

6 Consumer Decision Making Processes

6.1 Types & Amount of Information Search

Consumers may have many queries regarding LBHC before they purchase the product. Some of the queries include: How much is the price of the hair colourant? Where can I purchase the product? Is the product easy and good to use?

The types of information a consumer needs can be classified into two categories, internal and external information, as illustrated in Figure 6.1.

Figure 6.1: Types of information

Internet search, participating in forums, approaching sales personnel

Advertisements, peoples’ opinions

http://www.emeraldinsight.com/fig/0460100505001.png

As LBHC utilises an innovative way of dying hair using bubbles and gloves to apply instead of traditional methods, internal informational search such as personal experiences and memories will not be sufficient for consumers to make a purchase decision as this product is new to the market.

Thus, consumers will have to engage in external informational search such as seeking opinions from reference groups such as friends who had used the product before; engaging in discussion forums on the internet; visiting Kao’s website; and approaching sales personnel for more in-depth information.

6.1.1 Level of Involvement

Females born between the year 1979 and 1994, also known as Generation Y, are LBHC’s main targeted customers. Generation Y have shown to exhibit higher spending power and are more receptive to new things, such as technologies and products, than the previous generations (Goliath 2002). Because Generation Y spans between the age 16-31 years old, the level of involvement will differ between those that have started working and those who are still in their teens and schooling.

Generation Y who are employed will have lower purchase involvement than those who are unemployed as their income allows them to have higher disposable cash.

6.1.2 Level of Decision Making

According to Lamb, Hair and McDaniel (2009), all decision making falls along a continuum of three broad categories namely routine response behaviour, limited decision making and extensive decision making. The relative importance of external informational search increases as consumers move towards the extensive decision making category. As discussed above, consumers engage in both internal and external information search as they do not have previous experience with LBHC as it was recently introduced into the market.

The level of decision making is also dependent on the level of purchase involvement and the price of the hair colourant. As the purchase involvement is moderate and LBHC is more expensive than other hair colourants, coupled with the fact that the product is new to the market, the level of decision making is analysed to be extensive decision making.

6.2 Evaluation of Brand

LBHC belongs to the hair colourant category. The possible different brand that consumers will evaluate could be L’Oréal and Hoyu hair colourant products. This product is analysed to be in this segment’s evoked set as the product was heavily advertised as a relatively easier and more convenient hair colourant which colours the hair evenly. However, the evaluation of brands differs from each individual as they may place different importance on evaluative criteras.

6.2.1 Criteria in Evaluating of Purchase Decision

Under the hair colourant category, there are various criteria as listed in Table 6.1 below to how consumers evaluate the different brands.

Table 6.1: Attributes when evaluating hair colour products

· Design and packaging of the product

· Price

· Convenience of usage

· Colour selections

· Lasting effect of the hair colour

· Damaging effect of product

These are common evaluating criteria but their relative importance varies among individuals. The decision rule adopted by consumers also affects which product will be selected eventually.

6.2.2 Decision Rules

There are five decision rules that consumers commonly use, either singly or in combination. They are conjunctive, disjunctive, lexicographic, elimination-by-aspects and compensatory rules. We have identified that the lexicographic decision rule used mainly by consumers buying hair colourant products.

6.2.2.1 Lexicographic Decision Rule

The lexicographic decision rule requires the consumer to rank the criteria in order of importance. The consumer then selects the brand that performs the best on the most important attribute. If two or more brands are tied on this attribute, they are evaluated on the second most important attribute. This will continue until one brand outperforms the others. For example, if price is the most important attribute, the price that is the cheapest will be selected by the consumer. If two or more brands are tied, then size, being the second most important attribute, will be evaluated against the tied brands.

6.3 Shopping Behaviour

There are several attributes that may affect consumers’ shopping behaviour and retail outlet selection. These attributes are discussed as follows.

6.3.1 Outlet Location

To purchase LBHC, consumers would normally head to retail stores of their convenience. This product can be found in all leading pharmacies such as Watsons and Guardian, and leading supermarkets and hypermarkets such as NTUC, Cold Storage and Giant. Consumers can also tap on non-conventional purchasing methods such as using E-commerce websites like eBay or through third parties via forums.

6.3.2 Retail Advertising

Advertising methods, which will be elaborated in Section 7.3, can also increase the consumers’ awareness and likelihood of purchase.

6.3.3 Consumer Characteristics

Social risks may also be considered upon purchase as the product may reflect the consumer’s image, lifestyle and personality. For example, consumers may want to be perceived by their peers as being trendy and adventurous and therefore purchase LBHC as compared to other known hair colourants.

6.3.4 In-store Influence

Price reduction such as in-store discounts will be a major factor that motivates consumers to purchase LBHC as compared to other hair colourants. Placing the product at eye-level will also capture consumers’ attention and increase the likelihood of purchase. However, unforeseen circumstances such as having stock-outs for the product may cause consumers to switch to an alternative brand. Finally, sales personnel that actively promote certain brands will also significantly influence the consumers’ purchasing behaviour.

6.4 Postpurchase Behaviour

The possibility of postpurchase dissonance happening to consumers will most likely be low as the level of purchase involvement is relatively low. Features of hair colourant are generally similar and thus consumers will not feel that they have given up attractive features of the unselected brands. Similarly, even though consumers are not able to get a refund if they are dissatisfied after using the product, they can easily switch to alternative brands. Furthermore, the importance of the decision to purchase hair colourants is low as the products are inexpensive and the colour effects are non permanent.

6.5 Disposal

The shelf life of hair colourants generally last up to several years. When it needs to be disposed of, consumers may either dispose it to the waste or have the product’s plastic container, sent for recycling. Alternatively, consumers that did not use the product may engage in consumer to consumer sales either through the internet or other platforms.

6.6 Loyalty

The potential Generation Y teenage male segment tends to be more adventurous in trying out new hair colourants to compare the quality to the existing product they are using. However this does not imply they do not have brand loyalty, as they will most likely be switching back to the previous brand if the new brand does not meet their standards.

Generation X on the other hand, tends to evaluate their choices carefully before reaching any purchase decisions. This pattern often discourages brand loyalty towards LBHC (Manning-Schaffel 2002).

Kao Corporation believes in “Yoki-Monozukuri”, which means the excellence of the development and manufacturing of products (Kao Corporation 2010). The promise of excellent quality in their products could contribute to consumers’ brand-loyalty to LBHC. In addition, with Hiroko Miyamura, a well-known hairstylist in Japan, as the ambassador for LBHC (Kao Corporation 2010), consumers may perceive LBHC to be a trendy product and thus increase consumers’ brand loyalty towards it.

7 Marketing Strategy

7.1 Product

The packaging of LBHC helps to contribute to Kao positioning of the product as an innovative and young hair colourant.

Illustration 7.1: Packaging of Liese Bubble Hair Colour

Source: Kao 2009, LBHC, Kao Corporation, Singapore, viewed 2nd March 2010, <http://www.kao.com/sg/web/news_files/Liese_Bubble_Hair_Color.html>.

With the direction of use printed on the back of the packaging as shown in Illustration 7.2 below, Kao is trying to emphasise on the innovative characteristic of this product which is the replacement of traditional sectioning of hair during the dyeing process to simply applying and massaging, making the experience easy and convenient.

Illustration 7.2: Directions of use

The vibrant colours of the packaging together with pictures of youthful models displayed on it help to bring out the ‘young’ characteristic of the product. However, these physical characteristics of the product may result in wrong perceptions formed by potential target markets. For example, by looking at the packaging of the product, men may feel that this is a product more suitable for females and the consumers who are older may feel that this product is too trendy for their age.

Hoyu Beauteen on the other hand, tries to bring out a young and trendy feeling of the product through an innovative way of using female anime characters. However, this form of design may impede rapid diffusion of the product as consumers may not have confidence in the hair colours that are displayed through anime illustrations (Illustration 7.3).

Illustration 7.3: Anime illustrations on packaging

Source: Hoyu 2010, Characters, Hoyu, Singapore, viewed 23^rd March 2010, <http://www.hoyu.com.sg/Beauteen/>.

7.2 Price

At $19.90, the price of LBHC may not be considered a very important evaluation criterion for the section of the target market who are employed as this amount does not represent a substantial part of their income. However, for the section of the target market who are students, this amount may be a big portion of their allowances, resulting in price being an important evaluation criterion. On the other hand, priced at $10.90, an amount that is probably not significant to the entire target market, the price of Hoyu Beauteen is thus not an important evaluation criterion.

Although price reductions due to promotions may motivate the target market to purchase these two products, major responses such as purchasing these products in bulks due to a price reduction will however not be expected as hair colourant is not a necessity good but more of a beauty product which consumers may use once in a few months.

As there is no class differentiation brought about by hair colourants, prices are thus not a relevant indicator of status.

7.3 Promotion

LBHC uses commercial advertising through different channels such in TV commercials and websites. In the commercials, LBHC endorses young prominent models such as Rena Takeshita in Japanese commercials to promote their hair colourants (Kao 2010). LHBC commercial in Singapore uses Ezann Lee, a Mediacorp artiste to demonstrate and promote the product (Illustration 7.4).

Illustration 7.4: Liese Bubble Hair Colour’s Singapore commercial

Source: Youtube 2010, Liese Bubble Hair Color For Beautiful, Evenly Colored Hair, viewed 20 March 2010, <http://www.youtube.com/watch?v=ZYd3JXNJzZE&feature=PlayList&p=A0AA2AF5ECA57174&playnext_from=PL&playnext=1&index=3>.

This largely appeals to the target segment as they belong to the same age group. The target segment will be able to view such commercials together with its information in Kao’s Singapore website.

There are also special LBHC shelves in pharmacies where it displays the full range of LBHC (Illustration 7.5).

Illustration 7.5: Liese Bubble Hair Colour promotion shelves

Source: Dollie 2010, Review on Liese Bubble Hair Color in Glossy Brown, Singapore, viewed 20 March 2010, <http://damoiselle.wordpress.com/2009/09/29/review-on-liese-bubble-hair-color-in-glossy-brown/>.

Similar to LBHC, Hoyu promotes their hair colourants through websites. However, the most significant strategy of Hoyu was its sponsorship as the official hair colourant for Mediacorp Channel 8’s Project Superstar 2 program. (Mediacorp 2010).

By using suitable promotion strategies that is relevant to the target segment, LBHC will be able to capture the attention of the target segment through their commercials and websites effectively.

7.4 Place

LBHC and Hoyu Beauteen are easily found in supermarkets and personal care stores such as NTUC, Giant, Watson and Guardian which have numerous outlets found at convenient locations. Unlike the older generation who prefers to shop at supermarkets due to the variety of products offered, our young target market will prefer to be able purchase the product conveniently at places such as pharmacies near their residence or specialized cosmetics shops such as Sasa.

8 Evaluation and Recommendations

8.1 Evaluation

Out of the two marketing campaigns, we feel that LBHC is more effective as compared to Hoyu Beauteen.

For Hoyu Beauteen, it portrays itself as a low-cost product. As a result, there are apparently no printed or TV advertisements and these savings allow Hoyu Beauteen to be sold at a low price. Although the price of this product is low, it may not attract the attention of the Generation Y teenagers as there is a lack of awareness through advertisements.

However, for LBHC it portrays itself as an innovative product and emphasises on the unique method of applying the hair colourant in their TV advertisement. As Generation Y are more adventurous and constantly seek new changes, this creative TV advertisement will allow the target group to recall the product better as compared to Hoyu Beauteen.

8.2 Recommendations

8.2.1 Product Positioning

LBHC should continue to position themselves as an innovative hair colourant for the young and fashionable females. However, they may consider using more intensive taglines for their advertisement which will improve the other aspects of the motivational factors such as self-esteem and confidence to influence consumers’ purchase decision. Hence, the brand can be perceived positively and LBHC can achieve a place in the consumers’ awareness set and then into their evoked set as well.

8.2.2 Marketing Mix

8.2.2.1 Product (Goods and Services) Enhancements

LBHC should come up with a wider variety of colours so that consumers can have more choices. Another idea would be to introduce additional features such as glossy or shine to the colourants. By having these additional features, consumers will not turn to other brands for those colours or features they cannot find in LBHC.

8.2.2.2 Improved Marketing Communications

LBHC should adopt an aggressive advertising strategy through means such as TV commercials, magazines, newspapers, sponsorship, radio, bus and train advertisements, or even emails to existing or potential customers. In addition, they can participate in bazaars in tertiary institutions and have demonstrations on the usage of the LBHC. This allows general consumers and students to have a deeper impression on the product, especially its unique application.

8.2.2.3 Improved Purchase Experience

Sales personnel that have strong knowledge of the product will help to improve the purchase experience of consumers. This is because knowledgeable sales personnel are able to answer any queries or doubts, dispelling fear and uncertainty.

In addition, by ensuring adequate product inventory in retail outlets, consumers will not experience frustration or disappointment of not being able to purchase the product due to a stock-out. This will also help to improve the purchase experience.

8.2.2.4 Identifying Potential New Customers

The consumer segment that the product targets now is female consumers from Generation Y. Potential new customers may come from the male counterparts from this target segment.

The product packaging now features mainly female models and colours are femininely named to appeal towards the females. Reaching out to the male consumers may require repackaging the product so that it features male models and renaming the colours to reflect a more masculine nature. New advertising campaigns will also have to be launched to increase male consumers’ awareness.

8.2.2.5 Enhancing Customer Satisfaction

Customer satisfaction can be increased by ensuring that the product produced is always of high quality. Being consistent with product quality will not only help increase customers’ satisfaction, it also allows the consumers to be insensitive to product pricing. Besides quality, being able to deliver the promises that the product advertises will also greatly enhance customers’ satisfaction. If the product fails to deliver as promised, customers will feel that they had been led on by false advertising and customers’ satisfaction will plummet.

Establishing a toll-free hotline and a website in countries where LBHC is sold will allow consumers to have an avenue of feedback on how the product can be improved. Kao can then enhance customer satisfaction by improving on their product and alter it according to the needs of the consumers. Finally, infusing the product with properties such as vitamin C for healthy hair will enhance customer satisfaction as the added properties will be perceived by customers to be value-adding.

9 Conclusion

In conclusion, LBHC has been relatively proactive in their advertising campaigns. They have been adopting creative marketing strategies to gain awareness from its target segment. The use of young models in their advertisements will bring out the trendy and fashionable image that our target segment pursues.

In future, Kao may consider marketing strategies such as TV sponsorship or the usage of more intensive taglines for their advertisements. Liese may also consider tapping into the male market by coming out with hair colourants that are more suitable for the male audience.

Liese should also continue to position themselves as a hair colorant for the trendy youth and uphold its current innovative image to continue growing its market share, and become a sustainable market leader.

10 References

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Tuesday, 31 January 2012

Asian hair