Electronic Healthcare Products

Table of Contents

Item                                                                                                          Page

i) Cover Page                                                                                                 1

ii) Table of Contents                                                                                     2

iii) Introduction                                                                                             3

1) Market                                                                                                       3, 4

2) Competitor                                                                                                4, 5

3) Identification of Target Market                                                              5 – 9

            3.1) Primary Target Segments                                                         5 - 9

            3.2) Potential Target Segments                                                        9

4) External Influences                                                                                   11- 13

            4.1) Culture and Subculture                                                            11

            4.2) Demographics                                                                            11, 12

            4.3) Group Influence                                                                        12, 13

5) Internal Influences

            5.1) Needs and Motives                                                                     13, 14

            5.2) Perception                                                                                   14, 15

            5.3) Learning                                                                                     15, 16

            5.4) Lifestyle                                                                                      16, 17

6) Consumer Decision Making Processes

            6.1) Information                                                                                17

            6.2) Consumers evaluative criteria                                                  17, 18

            6.3) Retail Outlet Selection                                                               18

            6.4) Post Purchase Behaviour                                                          18

            6.5) Product Disposal                                                                        18, 19

            6.6) Loyalty                                                                                        19

7) Marketing Strategy                                                                                   19 - 26

8) Recommendations and Evaluation                                                          26 - 

9) Conclusion                                                                                                 30

10) References                                                                                               31, 32

11) Appendices                                                                                              33 - 37

Introduction

Electronic Healthcare Products has gained popularity for the working adults and elderly in recent years as consumers seek ways to relax and take care of their body. This report aims to critically analyse consumers’ behaviour with relations to OSIM’s latest uPAPA Hug with comparison to their leading competitor, OTO’s Power Tap PT 708.

1. Market

Market Size and Market Share

Singapore has a population of estimate 4.8 million, of which estimate 3.6 million are over age 25 (Singstat 2009), reflecting the major group of consumers and the market size for electronic healthcare products in Singapore. As there is limited sales information for electronic healthcare products in Singapore, the market share for OSIM is undeterminable. However OSIM believed that they are the market leader based on its latest survey done by Synovate (Brand OSIM 2009).

OSIM’s product range and principal products

OSIM provides a variety of electronic-products that are inter-related to health and body care. Other electronic products such as vacuum cleaners are introduced and they served as complementary products as these products are designed with the improvement of lifestyle (such as better well being of health) in mind, such as the sanitising function for the vacuum cleaner. Its principal products comprise of the various electronic massagers such as the uDream, a massaging chair and also uPAPA Hug (OSIM 2009a), the focus of this report.

Focus on OSIM uPAPA Hug

uPAPA Hug was a innovative step up creation of snug-fit  from the older product of uPAPA which has been in the market for approximately half a year. The focus on uPAPA Hug is still ongoing on their main website which proves that OSIM is still active in pushing the product to their consumers, informing them of the latest version that is relatively different from the older version of uPAPA, with reviews and comments at their websites by current users, it allows inquisitive and potential consumers to understand how uPAPA Hug can also help them with their back relief.

Product Life Cycle

The OSIM uPAPA Hug is considered to be still in the growth stage of the product life cycle. uPAPA back massagers are already a known product maintained in the healthy lifestyle market with uPAPA Hug as a new design of the uPAPA with a competitive price. uPAPA Hug is already a recognised product with customers giving constant positive review.

2. Competitors

Major competitors marketing similar product as OSIM within the electronic health care category is IPS Brothers Enterprise Pte Ltd’s OTO and OWELL BodyCare Pte Ltd. In terms of establishing their local presence, both OTO and OWELL currently operates 17 and 8 outlets respectively, while OSIM has 37 outlets island wide. Base on these figures, OSIM is perceived as being more established than the former 2 companies. Moreover, although the companies are seemed to serve the same niche market, they differentiate themselves in terms of product offering; Both OTO and OWELL concentrate on its product functionality and features with the latter providing a much limited range of product offering whereas OSIM focus on innovating its user friendliness, designs and quality.

Furthermore, the existence of other indirect competitors poses a substantial threat to OSIM’s market position. These include numerous spa treatment centres, registered and unregistered massage parlours which altogether aim provide customized services suited to each individual needs. These services acts as a form of substitutes towards OSIM which offers limited functions to each individual needs.

3. Identification of Target Markets

3.1 Primary Target Segments

Both OSIM uPAPA Hug and OTO PowerTap have identical design and shared similar purpose of massaging and release aching stress targeting in the shoulder region. Both products also demonstrated the flexibility to massage other areas such as the back and the thighs. However with their marketing antics and branding, uPAPA Hug and PowerTap may have slightly different competitive primary markets.

Demographics – OSIM uPAPA HUG

Demographic	OSIM uPAPA Hug	Remarks
Age Group	25-35 (Generation Y) & 50 years old (Generation X) onwards	It focuses on providing a relaxing experience as well as a stress remover which young working adults are facing in the fast paced lifestyle. As the society advances, young adults are often suffering from muscle discomfort due to their work nature (such as being deskbound for a long period of time), thus enhancing OSIM UPAPA Hug attractiveness. In addition, OSIM UPAPA Hug was also advertised as a perfect present for the elders.
Gender	Male and female	As seen on their advertisements, a young lady with toned figure was portrayed. It displayed the ‘gentle’ side of the product, symbolising that it is suitable even for female usage. The male models playing the drums symbolised that the product has a ‘male dominant side’ too. OSIM attempted to attract such consumer by emphasising that UPAPA Hug not only can be used on the neck and shoulder, it can also be used to target buttock and thigh area.
Income level	Middle-high income level	People with spending power and are particular on enhancing their lifestyle.

Demographics OTO PowerTap PT 708

Demographic	OTO PowerTap	Remarks
Age Group	45 years old onwards	Older people tend to suffer from muscle aches more often compared to the youngsters. OTO focus more on the ability to heal and cure “elderly” problems, such as body ach. (seen through their advertisement- a Old celebrity telling her experience after the used of the PowerTap. As mentioned by their slogan: Bodycare)
Gender	Male and female	The targeted market resemblance a mixture of both genders as their focus is on elders in general.
Income level	Middle-high income level	People who are more educated and are willing to spend the money to purchase the equipment

Psychographics

	OSIM uPAPA Hug	OTO PowerTap
Attitude	By having a portable and stylish device at home, it saves space yet enables the consumer to enjoy a great massage to relax and release stress from work. Moreover it is more convenience and cost saving compared to going for regular massage session	It has proven testimonial from users that the products does help to solve aching problems. The health care products provide the consumers with value for money as it can be used for other parts of the body.
Values	UPAPA Hug consist of several functions and usage method to provide total body relief to resolve stiffness and muscle aches arising from daily routines. It emphasize on stress removal and body energising (tangible). It also allows one to feel good/relaxed and gain a sense of satisfaction (intangible). More are pursuing it, as it is convenient (compact and portable) for personal and family usage.	The PowerTap on the other hand focuses on providing percussive rhythm improves blood circulation and relaxes tense muscles. They emphasis on improving lymphatic flow, immune system and nerve function, thus helping you sleep better, providing a more customised experiences by having 8 intensity levels and 32 rhythmic cycles to cater to individual needs
Activities and interests	Consumers may use the products at work or home at their convenience timing. As for the ladies it serve as a alternative to a healthy slimming session.	Consumers may use it as a solution to a problem that they are facing currently. They are targeting elderly who usually sits around for long hours and are experiencing from numbness due to low blood circulation.
Media patterns	The products have been advertised on the website and daily media such as newspapers, public transports and magazines. Occasionally they hold road shows at town area to capture the attentions of working adults in the regions.	The products have been advertised widely on the website and daily media such as newspapers and magazine. The main difference between OTO and OSIM advertising media pattern is, OTO advertise on radio FM such as 958 whose audiences are mainly age 50 years old and above.
Usage rates	Consumers can use it freely without having to worry about the availability of the product/service after purchase. A consumers’ testimonial commented that such massaging equipment is good and he uses it 3 times a day during the intervals of his physical demanding job (e.g. driving cab for long hours) to help him relax better (Purba 2009).	Consumers can use it daily to improve their overall well-being. Alternatively, use it when they are experiencing from body numbness or pain due to low blood circulation.

Behavioural

Deal proneness is a function of both consumers’ buying behaviour and the frequency with which a given brand is sold on a deal basis (Frederick, 1965). OSIM leveraged on the usage of powerful marketing strategies at the right time to promote their products. For instance, OSIM advertised their uPAPA Hug product as an ideal father’s day gift, as it simply means give your father (PAPA) a Hug. Being Asia’s number 1 most preferred healthy lifestyle brand, OSIM’s uPAPA Hug tend to attract consumers who are more brand conscious and susceptible to marketing influences (OSIM, 2009)(AppendixA).  Whereas, OTO’s PowerTap attracts consumers who are more performance orientated.  It offers 32 functions and 8 speeds manufactured in Korea as compared to uPAPA Hug’s 4 functions and only 2 speeds manufactured in China (OTO BodyCare, 2009)(Appendix B).

3.2 Potential market Segment for OSIM

Currently OSIM target audience are identified as 2 major groups

1. Young working adults 25+ to 35 (Generation Y)
2.  Elderly that are in their 50s+ (Generation X)

Potential new markets will be to extend their demographics and identify characteristics such as newly weds and new parents. Thus OSIM can leverage on these new target segments as;

·         Increased stress and workload from the additional family member

·         Change in purchasing pattern, males is more willing to get products for their wife and family.

·         Socially conscious about their image, especially females after childbirth.

·         Particular about having a healthy and balance lifestyle

·         More females entering the workforce and have the spending power as compared to the past

·         Health become less of a luxury and more of a necessity issues

Moreover OSIM is perceived as a lifestyle product in the eyes of the consumer; OSIM can leverage on that perspective and promote it as being cool to be seen as unique by having OSIM products at home, as compared to the OTO brand.

The following sections will analyse how external and internal influences impact upon the targeted segment that consist of young working adults (Generation Y) aging from 25-35.

4. External Influences

4.1 Culture and Subculture

Singapore is a multiracial country with the main population being Chinese; certain key oriental values (other-oriented values) are being abided such as filial piety and collectivism. uPAPA Hug served as an ideal gift for the Generation Y to their parents or to friends, which will boost sales during festive seasons and celebrations.

Even though oriental values are being preserved, the western cultures also heavily influence Singapore as globalisation takes place. Generation Y are being more technological savvy and often relied on technology to perform their daily tasks. Instead of visiting a traditional massage parlour, uPAPA Hug offers the ease of massage anytime anywhere at an affordable price, another key issue as the pace of life of Singaporeans gets heavier and faster. Generation Y also exhibits self-oriented values such as seeking leisure and sensual gratification as they are getting more work stress.

Being a highly competitive society, Singapore indicated traits of a status-oriented society and established brand names are being sought after by the rich and famous. Being a market leader in the electronic healthcare products, OSIM is able to carry its brand name and reputation of quality and style to the product, enhancing the value consumers perceived.

4.2 Demographics

Age and Income

The Generation Y represents the large dynamic workforce of Singapore. As discussed, Singapore’s Generation Y is increasingly becoming knowledge workers, which in turn increased their income that is directly related to their purchasing power. With the discussed, its shows that majority of the Generation Y are capable of purchasing and own a unit of uPAPA Hug.

Gender

The percentage of males and females in Singapore are 49.5% and 50.5% respectively (Singapore Statistics 2008). Gender has been a long-established segmentation variable, not only in the sense of there being products for men or women, but rather that traditionally most consumer goods were bought by women (Evans, Mountinho & Raaij 1996). Women tend to be more modern and are more willing to spend on relaxation and shopping while men tend to splurge on technology gadgets. uPAPA Hug compresses of relaxation and stress relief with the latest technology in build, which is suitable for both genders.

Socioeconomic

The population in the 21st Century is mostly educated and has at least 94.2% literacy rate (Singapore Statistics 2008). With the above discussion, it signifies that the Generation Y today is more knowledgeable and tends to make more high-involvement purchase. Thus the usage of advertisements for uPAPA Hug to educate and attract this segment (as it can be easily communicated) is critical in its marketing campaign.

4.3 Group influence

Reference Group influences the control that a group may have over an individual. It affects the product type/category/brand used; the medium which consumers communicate and learn from each other. By understanding how groups think, it enables us to understand consumer behaviour better.

Informational influence occurs when an individual uses the behaviours/opinions of reference group members as potentially useful pieces of information. One example would be online forums (e.g. hardwarezone.com). Young working adults frequent such sources to search for the information they required, so as to get the best deal available. Many senior members of reliable sources (such as hardwarezone forum) vouched for OSIM uPAPA Hug, as they had good experience with it. With the positive comments to boost consumers’ confidence (Hardwarezone 2009), consumer will have an increase in tendency to purchasing it over other brand similar product (e.g. OTO PowerTap).  

Furthermore in an independent survey conducted by international market research company, Synovate, and supported by International Enterprise Singapore (IE Singapore), OSIM came up as the Number 1 Healthy Lifestyle products brand in consumers' mind across Asia (Brand OSIM 2009). Based on this noteworthy information, consumers (young working adults) would be enticed to purchase OSIM brand products over other brands.

5. Internal Influences

5.1 Needs and Motives

The first factor affecting consumers’ purchase behaviour is motives. A motive is often triggered by the perception of a discrepancy between a desired state and an actual state that is both sufficient to arouse behaviours and relatively important to an individual.

Maslow’s hierarchy of needs is a theory designed to account for most human behaviour, depicting a natural progression from physiological needs to high/self-actualisation needs (Maslow 2000). We would see how purchasing and/or using the product are fulfilling social and self-esteem needs of the targeted market segment.

Young working adults nowadays often seek good health to meet and overcome the challenges in their life, especially in their work, because of the fast paced society. They have longer hours and are demanded the flexibility and agility to meet with demands, much more than compared to the past. This multiplied their stress level and lessens the time for them to relax. Hence, it creates a motive/desire in them for all these issues to be relieved.

uPAPA Hug is launched in a way that satisfies the above motives by helping young working adults to relieve stress and tensions by means of loosening their muscle tissues to improve blood circulation. This enabled them to fulfil their desire for relaxation and to feel more energized at work, to readily face and overcome any future work challenges. 

Purchasing the product enhances the good health and well-being of this target segment. As such, their overall image and work productivity is always at the peak, thereby fulfilling their esteem needs. Also, since the product is reflected upon positively in the minds of young working adults, it is likely the product would be purchased as a gift to their love ones, or be given as a gift by their love ones, thereby fulfilling the target segment’s social needs.

5.2 Perception

Perception is a critical part of the human brain’s information processing system, which is triggered by consumers’ 5 senses. By understanding the information-processing model, we will be able to influence consumers in their decision making of a product.

Exposure

OSIM uPaPa Hug has been advertised through various mediums such as TV, radio commercials, newspaper and posters/boards on public transports. The advertisements are often presented in full colour and are of substantial size (Appendix C, D). This initiative will ensure that uPaPa Hug stands out among the rest and sub-consciously stimulate the consumers’ sight to project the product in the consumer’s brain.

Attention

OSIM holds various road shows at major shopping malls (Appendix C) to inform public of their new product launch and celebrity endorsement are often involved to capture the attention of the crowds. OSIM advertisements focused on presentation and usage of innovative technology, such as eastern acupressure points theory and western sports science.

The positioning of a drum beside the uPaPa Hug draws an attention in relating the effectiveness and power of the product. The simple and straight forward presentations of a well tone lady using the uPaPa Hug helps to draw the readers in visualising the usage of the massager and individuals will naturally be grazing by the smooth and soft colours used in uPaPa’s advertisement as the visual images are the richest and most stimulating.

 A short 30 seconds commercial of uPaPa Hug in the radio or television also increased the attention of the consumers by focusing on the main usage of the product (YouTube 2009a). The compressed messages will stimulate the brain in processing the product in the consumers’ mind.

Interpretation

The advertisement creates a relaxing and relieving atmosphere after a long tiring day. Individuals will relate the power and strength of the drum to OSIM uPaPa Hug (YouTube 2009a) which delivers powerful punch to provide soothing and effective relief for neck and shoulder and other body areas.

5.3 Learning

Marketers of OSIM may use operant conditioning to help our selected potential target segment (young working adults) to learn more about UPAPA Hug. In this application of learning theory, it proposed that consumers require to be engaged in an initial trial of the product before the product can become rewarding for them. Therefore, marketers often encourage consumers to engage in that first trial experience by using different appealing approaches. 

One useful approach would be for OSIM to organise marketing campaigns in the Central Business District (CBD) area, where the majority of the target segment are located. In doing so, OSIM marketers can capture the attention of these people more successfully, and hence providing them with the opportunity to test out the effectiveness of uPAPA Hug. The target segment would have little resistance to trial the product, because it is perceived as an ideal way for them to relax during their break time (desired response). To make it even more enticing; it is free of charge. During the trial out session, the young working adults are able to gain real life experience and a better knowledge of how the product functions.

As such, if the product is found to be pleasurable (positive reinforcement) , the chances of them repeating the behaviour will be increased in the form of purchasing it. Therefore in buyer behaviour context, the consumers’ positive conditioned response to the try out has reinforced them to purchase the product, so as to enjoy the product continuously without limitations.

5.4 Lifestyle

Generation Y have a preference towards western culture which adopts a work life balance lifestyle due to their exposure to western culture since young, They are identified by Roy Morgan valve segment as the young optimism category that comprises of young professionals who are career oriented and ambitious.  uPAPA Hug particularly appeal to consumers with such lifestyle as individuals utilise it for relaxation after their stressful schedules and OSIM’s brand name symbolises their individual identity.

However uPAPA Hug can also be associated with other diversified forms of lifestyles. As abovementioned, Generation Y are status oriented and are heavily influenced by others approval and opinion. Consumers influenced by such lifestyle tend to have high regards for social and esteem needs, and feels the need to be associated with ‘high-class’ status. Supported by VAL’s system, innovators group, such consumers purchase UPAPA Hug as it reflects their “high class” image. For that reason OSIM attempted to align their customers’ values to their own values and had portrait themselves to be a lifestyle brand, which can be see through their slogan -inspiring life.

Consumers of UPAPA Hug also exhibit characteristic that strongly supports a healthy lifestyle as one of their priorities, inline with the lifestyle pursued by most consumers that are age 50 years old and above (Generation X); closely resembled the thinkers and believers group under the VALS segment. These strongly illustrate that uPAPA Hug is a solution for stress relieves for people experiencing different lifestyles.

6. Consumer decision making processes:

6.1 Information

Potential consumers will sought after information such as 1) the existence of similar product from various brand, 2) the performance level of each brand and 3) characteristics of the product under each brand. A consumer typically will undergo high level of purchase involvement and undertake extended decision-making in the purchase of uPAPA Hug because it involves a complex evaluation of multiple alternatives (such as purchase of an electronic-massage chair or other traditional options versus uPAPA Hug) and it involves some form of risk (financial and personal). As OSIM is the market leader for electronic healthcare products, the brand presents a high possibility to be in consumers’ evoked set upon decision-making.

6.2 Consumers evaluative criteria

Consumers often evaluate electronic-health care products based on awards won (design award etc.) and certifications (such as ISO certification) of the products. The main evaluative criterion for UPAPA Hug includes 1) functionality, the basis of solution for consumers’ problem, 2) price and 3) brand, whereby both served as surrogate indicators as the higher price usually indicates a higher quality and leading brands (such as OSIM) are associate with quality as it is well known for a wide range of high quality products.

6.3 Retail outlet selection

uPAPA Hug’s is well known as OSIM has a strong brand name in its reputation for quality lifestyle electronic health-care products. This exhibits that consumers shopping for this product will seek for the 1) brand and follow which the 2) outlet to make their purchase as they will seek for a brand they trust first, after which select an outlet that is of relevance to the consumer (such as outlet that is most convenient or friendliest staff).

6.4 Post Purchase Behaviour

After the purchase of uPAPA Hug, some consumers might face post-purchase dissonance such as faulty components or unsatisfactory results over a period of time. As it involves a high level of purchase involvement, a high degree of commitment and importance is attached, implying that the magnitude and probability of dissonance occurring is high.

To reduce the likelihood of post-purchase dissonance, OSIM can tailor its advertisements for recent purchasers such as using positive statistics (such as most sought after) or testimonials from satisfied customers. Also, post-purchase surveys and follow-ups can reassure them that they have made a wise purchase. Lastly, extended warranties can be offered to illustrate the confidence of quality in the product by OSIM.

6.5 Product Disposal

Consumers have three alternatives in disposing products; keeping it or convert it into new use, get rid of it permanently or temporarily, and giving it to other people or selling it. Study had shown that a higher value product would result in consumers to choose a disposal method that will allow some returns compare to a lower value product (Mowen & Minor, 2001).

uPaPa Hug can be considered costly to the majority of its target segment (a mixture of low and middle income mix) and the components maybe hard to disintegrate (compound materials with electronic chips). Therefore when a disposal occurs, consumer may choose to give it away to family and friends or donations or sell it to Cash Converters for some cash returns instead of simple disposal.

6.6 Loyalty

The potential segments may have different purchasing power and segments with lower purchasing power might choose for a cheaper alternative with similar features.

Brand-loyal purchases should be encouraged, as this initiative will increase the brand’s popularity and provides consumers with a feel of superiority. Newsletter can be sent to consumers to create awareness and ensure customer’s there is little or none post purchase dissonance through follow up calls to understand if the products are satisfactory. OSIM can also increase brand recognition via fulfilling corporate social responsibility and donate to charitable organisation for every product purchased. Consumers who purchase products from OSIM will indirectly form an attachment with the brand and will stay loyal to them.

7. Marketing Strategy

The following section shall examine the marketing approach engaged by uPAPA Hug and PowerTap to determine its market position and its success.

Marketing Mix		OSIM (uPaPa Hug)	OTO (Power Tap PT-708)
PRODUCT	Specification	1.      Thermal enabled (situated at the rear portion only) massager. 2.      4 rhythmic massage cycles and 2 different intensity levels of tapping massage. 3.      Product made in China.	1.      Thermal enabled (situated at both front and rear) massager with ventilation. 2.      32 Unique rhythmic massage cycles and 9 different intensity levels of tapping massage. 3.      Product made in Korea.
	Support	1.      1 Year Warranty 2.      7 days 1 – for – 1 exchange policy for any unserviceable units. 3.      Customers are able to return faulty product at any available retail outlets.	1.      1 Year Warranty 2.      7 days 1 – for – 1 exchange policy for any unserviceable units. 3.      Customers are able to return faulty product at any available retail outlets.
PRICE	Product Price	1.      $238  (promotional bundle excluded) 2.      Enable credit card holders to pay by installments.	1.      $298 2.      Enable credit card holders to pay by installments *only with every $500 and above purchases.
PROMOTION	Advertising	1.      Advertising using TV advertisement, flyers and banners. 2.      OSIM blog 3.      Road shows & Newsletters 4.      Health talk forums.	1.      Advertising using TV advertisement, flyers and banners. 2.      Elder Celebrity is engaged. 3.      Road shows & Newsletters
	Promotional offers	1.      Bundle promotions with other OSIM products at a lower price. (i.e. uSqueeze Foot massager [save $78] or uPaPa ).	1.      Free OTO ear thermometer or Neck Snuggler (both worth $68 each), plus Sweet Spot S-100 (worth $18) with every purchase.
PLACE		1.      Available in 37 shopping center island wide (both major shopping centers and residential malls). 2.      Internet website with product review and information. Also equipped with online shopping option. 3.      Retail outlets brightly furnished with vibrant lime and white color themes.	1.      Available in 17 shopping center island wide (both major shopping centers and residential malls). 2.      Website with product information. 3.      Retail outlets with less vibrant color themes such as grey and white.

Product

Both uPAPA Hug and PowerTap are creative innovations designed to aid their targeted segments to better their lifestyles. uPAPA Hug is positioned as a lifestyle product to its target segment (Generation X and Y) whereas PowerTap has positioned itself as a healthcare product to its target segment (Generation X). Inline with its positioning as a healthy lifestyle product innovator, OSIM sought to continuously innovate its brand, designs, technologies and concepts; the main appeal to Generation Y. Whereas Generation X are known for their conservative and traditional cultures and they focused heavily on capabilities over designs, thus PowerTap offered more functions and has air ventilation pockets that prevents the system from overheating.

However, more functions require a higher educated individual or further instructions and product training to use the product efficiently. Thus PowerTap might be perceived as a complex product with difficulty in usage, forming less appeal towards the Generation X who might appreciate the simpler and easy-to-use uPaPa Hug. This might also further discourage those who wish to purchase Power Tap product for their elderly parents or are less technology savvy. These characteristics implied that uPAPA Hug’s diffusion process would be smoother as compared to the Power Tap as uPAPA Hug’s acceptance level is higher.

Price

As mentioned, price is an important evaluative criterion when consumers seek to purchase such electronic healthcare products. In comparison, uPapa Hug is selling at $60 cheaper relative to Power Tap which is critically important as Singaporeans sought tighten their wallets during the current recession which has crippled their financial capacity to sustain a luxurious lifestyle. This also implies that a price reduction or a discount will enhance the desirability of uPAPA Hug. However, noted from needs and motives, this product is a pathway to seek esteem and social needs, if the price reduction was too huge, it will be viewed as a ‘lower-class’ product as price are often used as a surrogate indicator for quality and status with relations to the purchase.

To aid consumers with lower financial capabilities, OSIM allows its consumers to pay by credit card installments for all its products whereas OTO requires a minimum $500 purchase before its installment scheme could be activated. OSIM stands advantageous in this area as consumers are incentives towards such readily installment schemes which eases them financially.

Promotion

In promoting uPAPA and Power Tap, both companies have communicated different values to their individual targeted segment. As mentioned, both products are positioned differently; uPAPA focused on lifestyle and vibrancy, thus the engagement of bright colours and young female model in their various modes of advertisements (Appendix A, C) to communicate the value of importance of a quality lifestyle to their target segment of Generation Y. However, Power Tap engaged in dull colors and older models for their advertisements (YouTube, 2009b)(Appendix B, C) as their goal is to communicate the benefits of PowerTap to their target segment of Generation X and such materials can relates to them better.

Both companies engaged similar marketing channels such as advertising through the Internet, magazines, flyers, TV advertisements, road shows and sporting events. In addition OSIM also engaged in other forms of marketing campaigns; Health talks were conducted by OSIM, in hospitals to promote and educate patients and visitors the benefits of using OSIM products such as the uPapa Hug (OSIM 2009b). This aids OSIM to promote its products more efficiently and positively; especially to those who might resist new technologies (i.e. elderly). The endorsement by reviewers and hospitals could provide the ‘seal of approval’ that consumers will accept as indicative of quality. 

Furthermore, point of purchase displays such as promotional board is utilised (Appendix D), which displayed product information, pricing, bundles and instalments plans. This form of advertising, increases the possibility of spillover sales; the sale of other products such as OSIM uSqueeze. For bundle promotions, consumers are able to purchase complementary equipments at a discounted price coupled with instalments options; whereas OTO’s free gifts are subjected to availability and consumers are required to perceive it as something beneficiary rather than an inferior gift that might reduce OTO’s efforts of projecting high quality image.

Place

Both products have comparable channels of distribution despite their difference in positioning and difference in focus of target segment identified.

The traditional brick and mortar business format that utilises a shop front for consumers to browse physical products are strongly engaged by both companies for both target segments (Generation X and Y) by both companies. However, OSIM possessed additional 20 outlets that served as a competitive advantage as consumers may perceive OSIM to be more popular. It can also serve as a psychological advantage as consumers may perceive it as a convenient attribute regardless of purchasing or servicing uPAPA Hug.

In addition, as Generation Y increasingly becoming more “time poor” due to their hectic lifestyle, there has been an increasing trend towards online shopping. OSIM’s website offers an addition channel for distribution compared to OTO; online shopping that is inline with the hectic professional lifestyles of Generation Y identified previously.

Marketing Strategy

In examining the marketing mix engaged by both products, they have effectively utilise their marketing mix to formulate marketing strategies, such as OSIM’s preference strategy with information provided at point of sales as it is under consumers’ evoked set, (Appendix A, D) to affirm their market position and these images have been embedded into consumers beliefs, influencing the individual’s purchasing decision process.

8. Evaluations and Recommendations

With review to the above accessed marketing mix for uPAPA Hug and PowerTap, we can conclude that OSIM has a comparative advantage in Price, Promotion and Place whereas PowerTap has emerged stronger in the Product category. With this conclusion we can determine that OSIM can better exert influence on consumer decisions upon the purchase situation.

Although product is key in every consumer’s purchase, consumer behaviour largely depends on other appeals more often (such as emotional appeal). Price is an important evaluation criterion and equipped with a clever usage of colours and details compared to OTO (to capture the attention of consumers and influencing their perception) (Appendix C), OSIM will be presented under the consumers’ evoked set, contributing to the overall success of the uPAPA Hug.

The following recommendations are made in the attempt to better influence consumer’s purchase decisions, to ensure the continuity of success of uPAPA Hug.

Product Positioning

OSIM should maintain its positioning strategy for uPAPA Hug as an innovator. This is strongly related to its vision, ‘inspire life’ by improving the product through continuous improvement in its employee and work processes. Moreover, by being innovative, OSIM engages in a differentiation strategy that implies that competitors might find it hard to imitate and compete against, and consumers will perceive uPAPA Hug as ‘unique’. Thus defending OSIM leading position within the market.

Product (goods and services) Enhancements

The current uPaPa Hug comes with a 2-meter wire and may be inconvenient if there is no power plugs around. OSIM could develop one with portable chargeable battery to facilitate the movement and usage of uPaPa for the consumers. As the product is targeting at General Y consumers, OSIM can improve the physical appearance of uPaPA by having a wide range of color skins for consumers to choose from. This will blend in with their home decorations and create a unique style of theirs. Beside the color enhancement, OSIM can build in a mp3 player with uPaPa so that it can serve two functions of entertainment and relaxation for consumers while consuming the product.

Improved Marketing Communications

OSIM could amend its current media advertisement to emphasize its focus on quality lifestyle concept. This could include a scene where working adults and their parents using the Upapa Hug thus allowing consumers to appreciate better the usefulness of uPapa Hug better than their current usage of theme for uPAPA Hug.

In addition, uSqueeze foot reflexology units are currently placed in several major locations such as shopping malls and the airport for public usage. This ‘shaping’ process emphasize on inducing partial positive response from consumers by allowing them to test on OSIM’s products, leading to final desired response such as purchasing OSIM products. OSIM should employ similar tactics to its uPapa Hug by installing uPapa sampling units in populated areas such as shopping malls, cafes (i.e. Starbuc). However, it should be noted that these sampling test units should be functional at all times, as a non-functional unit would generate negative consumer feedback, leading to negative consequences such as poorer sales and reputation. Other similar ‘shaping’ techniques could also include OSIM renting its uPapa Hug to major consumers (such as B2B) at a low fee, which helps build a closer relationship with its potential segment and also advocates OSIM’s quality standard through public endorsement.

Lastly, OSIM could alias with telecommunication companies and its retailers to engage in location-based advertising (LBA) SMS service (Said 2007). This allows OSIM’s retailers to tailor and send specific marketing messages via SMS to shoppers (at no cost to consumers) who are in the vicinity of their shops; allowing shoppers to gain real time information on the latest promotions, inducing them to patronise OSIM outlets that may lead to increased unplanned purchases.

Improved Purchase Experience

OSIM can introduce In-store touch screen catalogue in every outlets to facilitate information to consumers, providing them convenience to check out the information of desired products that they are interested in. This can maintain consumer’s attention if the outlet is overcrowded and when in-house staffs are occupied. In order to uphold the idea of better living and comfort and to enhance the purchase experience of consumers, the outlets can be designed in a manner whereby it simulates a ‘homey’ feeling, such as the utilisation of quality home equipments (tables and chairs) and decorate a ‘home’ scenario, to make consumers feel at home. And to further enhance the purchase experience, in-house promotions such as ‘bundle pricing’ along with complementary products can be offered to consumers to make them feel satisfy and that the money is well spent.

Identifying Potential New Customers

Apart from the potential target segment identified in part 3.2, additional new potential market segment which OSIM can target on to further enhance the sales of uPAPA Hug have been explored. Using the business-to-business approach (B2B), the business sector is an area where OSIM can consider promoting their products to.

For example, by promoting their uPAPA Hug product to luxurious lifestyle organisations like Shangri-la Hotels and Resorts, where their number one ranked credo is to always provide customers with rewarding lifestyle experience during their stay with them (Shangri-la 2009). By placing uPAPA Hug in their suite rooms, there is a high possibility that it would further value add customers’ stay experience, and thus accomplishing the hotel’s credo. As such, by purchasing the product, it becomes a win-win situation for both parties. To trigger sales, OSIM may also consider giving some bulk purchase discounts to these potential clients.

Enhancing Customer Satisfaction

The enhancing of customer’s satisfaction is critical as it symbolises repeat purchase (brand loyalty). One way is to offer on-site servicing in addition to its 1-year warranty. This saves consumers the hassle of sending the faulty equipment to their outlet, and reinforces OSIM’s confidence in their product. Membership cards that include discounts for future purchase and participating outlets (such as cafes or Yoga centres and Gyms) can also be offered to reinforce the ‘lifestyle’ concept for consumers. Lastly, OSIM can offer trade-in options where rebates will be given for. By doing so, it aids in the disposal of consumer’s old equipment and ensure that OSIM remains in their evoked set.

9. Conclusion

This report established an in-depth understanding of consumer behaviours factors that contributed to the success of OSIM’s uPAPA Hug with a clear comparison to the competing OTO PowerTap. As consumer behaviors is product, person and situation specific, section 1 to 6 provided critical insights to analyse the factors that exert influences (external and internal) on consumers.

The analysis of marketing mix (4Ps) in section 7 established what shapes the perception of consumers on both uPAPA Hug and PowerTap and aided in the determination of the products and markets’ position and its overall marketing campaign’s effectiveness. This analysis, in addition to the discussion of section 1 to 6 enables us to make a concrete statement that OSIM uPAPA Hug can better influence consumers decisions due to its product/market positioning and the various marketing strategies employed to their targeted segments. Recommendations at the end of the report attempts to sustain the success of OSIM’s uPAPA, but bearing in mind with the ever-changing consumer’s behaviour, only constant innovation that meets to resolve consumer’s problem will enable OSIM’s uPAPA continuity of success in the future.         

Reference(s):

1. Brand OSIM 2009, ‘OSIM Asia No.1’, viewed 13th September 2009,                                 < http://corporate.osim.com/SG/brand_osim.html#asiano1>

2. Hardwarezone 2009, ‘Anybody own an OSIM UPAPA Hug or OTO Powertap?’, viewed 12^th September 2009,  <http://forums.hardwarezone.com.sg/showthread.php?t=2464126>

3. Maslow, AH 2000, ‘A Theory of Human Motivation’, Psychological Review, vol. 50, pg. 370-396.

4. Purba M, S 2009, ‘OSIM’s UPAPA Hug Review’ viewed 21^st July 2009, <http://www.osim.com/SG/product/upapaHug.aspx#review>

5. OSIM 2009a, ‘Inspiring Life OSIM’, viewed 22^nd August 2009, <http://www.osim.com/SG/product/upapaHug.aspx>

6. OSIM 2009b, ‘OSIM Events’, viewed 5^th September 2009, <http://osiminspiringlife.wordpress.com/category/osim-events/>

7. OTO BodyCare 2009, ‘Relaxation: OTO’s Power Tap , viewed 22^nd August 2009, <http://www.otobodycare.com/sg/english/product.cfm?productid=55D6E120-D0B7-89BE-2A13DA5B333D3ADB

8. Said, MA 2007, M1 partners SPH to offer S'pore's first location-based SMS advertising service, Singapore Press Holdings Ltd, viewed on 15 Sept 2009, <http://www.asiaone.com/Digital/News/Story/A1Story20071016-30430.html>

9. Shangri-la 2009, ‘Our Mission’, viewed 25^th September 2009, <http://www.shangri-la.com/en/corporate/aboutus/mission/ourmission>
10. Singstat 2009, ‘Population in brief’, viewed 15^th August 2009, <http://www.singstat.gov.sg/stats/themes/people/popinbrief2009.pdf>

11. Tandurust 2008, ‘Massage Rollers: Self Help, Handy, Anytime, Anywhere, Massage’, viewed 21^st August 2009,                              <www.tandurust.com/massage-therapy/massage-rollers-self-help-anytime-anywhere-massage.html>

12. YouTube 2009a, ‘OSIM UPAPA HUG’, viewed 31 August 2009, <http://www.youtube.com/watch?v=0DtN9KxrMZM>

                   

13. YouTube 2009b, ‘OTO POWERTAP 30TVC’, viewed 31 August 2009,                         <http://www.youtube.com/watch?v=4f4wx9mdLtw&feature=PlayList&p=2FAA5B67BC98C261&playnext=1&playnext_from=PL&index=9>