Case Study Analysis of Boots: Hair- Care Sales Promotion

1. BOOTS: HAIR-CARE SALES PROMOTION-
CASE STUDY ANALYSIS
- Kaustav Roy Choudhury

3. It all started when Jesse
Boot took sole control of his
father’s shop in 1877 and
established it as a private
company in 1883.

4. Today, it is one of the best-
known and respected retail names
in UK. They provide health an
beauty products. They also
developed and manufactured its
own products in collaboration with
top hair-stylists like Trevor Sorbie,
Charles Worthington etc.

5.  What Are The Mass
Market Products it
sells?

6. Panteneis the major product, with 8.4% market
share. The line-up includes shampoos, conditioners and
styling products suited to different hair types. The brand is
heavily marketed and distributed.

7. Alberto Culver begun in 1955 and
expanded its business to own 2000 store locations.
It changed the way commercials are broadcasted. It
also caters to men’s needs.

8. L’OREALheld 5% market share in
the UK. The group marketed over 500
brands and more than 2000 products. They
were found in all distribution channels.

9.  So Was That It?

10. Boots also had a range of premium hair care products developed in
collaboration of top hair stylists of UK.

11. Who were the
competitors?

12. The main competitors were:
• Tesco
• Sainsbury’s
• Superdrug
• Morrisons

13. How Are The
Customers?

14. The consumers are not at all
brand loyal. Boots customers
buy both premium and mass
market products.

15. About the Case:

16. Hi!!! I’m Dave Robinson from
Boot and Company Limited and I’m
thinking about the new sales
promotion strategy for the
Christmas.

17. I want to drive the sales volume
and trade-up customers from
lower value brands. I also want
to retain and build brand equity.

18. So, What are
your Options?
What are you
thinking about?

19. I’m thinking of :
1. Get 3 for the price of two
2. Receive a gift with purchase, or
3. An on-pack coupon worth 50p

20. No, Problem at all. I can solve
this very easily.

21. Let’s do a detailed analysis of Pros
and cons analysis of each and every
option.

22. 3 For the Price of 2:
Pros:
 Consumers can combine any item of their choice
 Sales will be thrice of pre-promotion sale
 Can’t be readily copied by the competitors
Cons:
 This might signal the customer that Boots is clearing its stock
 It might hurt the brand image.

23. Gift with purchase:
Pros:
 Sales will increase by 70% of pre-promotion sale
 Increase in the customer base by 40%
Cons:
 Customers won’t have the ability to choose their gifts and
might not like the product at all.
 Can be easily copied by the competitors.

24. On pack coupon of 50p:
Pros:
 Actual savings in monetary terms for price sensitive customers.
 Sales will be 1.5times that of pre-promotion sale
 Simple implementation
Cons:
 Can be easily copied by the competitors.

25. Okay!!! But what about
money?? I need to see it
as well.

26. Well I’m Not done yet!!

27. Lets look at few calculations:
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
Premium Products Mass Market Products
Costs for production and margins
Manufacturing cost Manufacturer margin Retailer margin

28. On further calculation for Premium
Products, it comes:
Option % change
in revenue
%increase in new
customers
Impact on
brand
equity
3 for 2 200 60% Negative
GWP 70 40% Neutral
On-pack
discount
50 50% Negative
So we should opt for GWP as
it has least effect on brand
equity.

29. What about Mass
Market Products?

30. Using similar techniques, it
came that for mass market
products 3 for 2 should be
selected. The profits were
highest for that and the effect
on brand equity was positive.

31. Yaaaay!! Now I can enjoy
my Christmas!!!
MERRY CHRISTMAS

32. MERRY CHRISTMAS to
YOU too!!!!

33. Recap:
• Boot and company limited is one of the best known and respected retail names
in UK.
• They sell mass market hair care products as well as they are associated with
production of their own line of hair care products in collaboration with various
hair stylists.
• The main hair care brands in UK are Pantene, Alberto Culver and L’OREAL.
• The customers are fickle minded and change their brand preference frequently.
• The main competitors of Boots are Tesco, Morrisons, Sainsbury’s and
Superdrug.
• For the mass market products the option with highest profits was selected as
they don’t create a significant effect on brand equity. Thus 3 for the price of 2 is
chosen.
• For premium products, the option with least negative effect on Brand equity is
selected. Thus GWP is chosen.

34. DISCLAIMER
 Created by Kaustav Roy Choudhury,
Jadavpur University during a marketing
internship by Prof. Sameer Mathur, IIM
Lucknow.