Analysis of the Bangladesh chapter of Unilever

Unilever is a transnational consumer merchandise fabrication giant operating in over 100 states all around the Earth. Unilever Bangladesh is the Bangladesh chapter of Unilever, where the company holds 60.75 % portion whereas the Government of Peoples Republic of Bangladesh holds 39.25 % portion.

Unilever ‘s one of the most popular trade name is LUX. They segments LUX. ‘s market harmonizing to geographical locations. It farther differentiates these sections into Socio Economic Cluster ( SEC ) which takes into history the standard of instruction and profession which finally measures the fiscal ability of consumers. The bunch is divided into five parts get downing from A to E. Unilever targets the urban and sub urban upper in-between category and in-between category section of the population, who falls under A to C of SEC.

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Tactical selling tools, 4P ‘s, are extensively used by the company to market LUX. Though LUX is produced in Bangladesh, Unilever Bangladesh maintains the same criterion all around the Earth. The merchandise is available in six different aromas under three different sizes. Since the demand for beauty soap market is to a great extent oligopolistic, fluctuations in monetary value lead to monetary value war which can finally interrupt down the company ‘s market portion. Therefore Unilever can non supply a better monetary value than its rivals. But the monetary value is low-cost by most of the people. Unilever Bangladesh has outsourced its distribution channels to third party distributers which allow them to administer LUX in monolithic majorities amounting to around ten million pieces. It undertakes the largest promotional activities in the beauty soap industry.

The beauty soap industry has a few major manufacturers of which Unilever holds market portion of somewhat less than 50 % . Other viing trade names like Tibbet, Aromatic and Keya have started to hold a strong consumer base, but LUX. ‘s merchandise features distribution and promotional activities have created high trade name trueness for which it is still the market leader.

Unilever, with the assistance of its heavy promotional activities, has been able to perforate the market. But the other manufacturers in the industry are presenting a menace towards Unilever ‘s market portion as they have moved towards the rural multitudes of the population. Therefore, Unilever Bangladesh should set about farther stairss such as traveling towards the rural and/or poorer section ; attract kids ( by doing a particular merchandise for childs ) and other advanced promotional activities to retain its bid in the industry.

Chapter 1

Introduction

1.1 Unilever at a Glance:

Unilever is one of the universe ‘s largest and taking transnational companies ; Unilever commenced their concern activities on a larger graduated table by puting up their first mill in Netherlands, in the twelvemonth of 1872. Operating in Bangladesh for over the last four decades the company is seeking to significantly lend towards the augmentation of the criterion of life by conveying universe category high quality merchandises at the door measure of their clients. The use of Unilever merchandises by over 90 % of the people in Bangladesh stands a testimony to their successful operation. . Their array of merchandises show that they produce family attention, fabric cleansing, tegument cleaning, skin attention, unwritten attention, hair attention, personal training, and tea based drink merchandises under worldwide celebrated trade name names Wheel, LUX, Lifebuoy, Fair & A ; Lovely, Pond ‘s, Close Up, Sunsilk, Lipton, Lipton Taaza, Pepsodent, All Clear, Vim, Surf Excel, and Rexona.

Aim of this study:

This study is an result of an analysis of selling schemes used by Unilever Bangladesh Ltd. The chief intent of the study is to happen what strategies the company uses to market its universe celebrated beauty soap, LUX, in Bangladesh ; the positive and negative facets of those schemes. The study further analyzes the place of Unilever Bangladesh Ltd. in the toilet articles industry in comparing to its rivals. The study discusses the procedure of utilizing market cleavage, mark selling, the merchandise, pricing, promotional and distribution schemes and a competitory analysis.

Methodology of this study:

For handiness and handiness of information we have chosen to work on the schemes of Unilever Bangladesh Ltd. As the company operates in the market with a immense figure of merchandises in different industries, we have decided to concentrate on one of their universe broad successful trade names, LUX. Most of the information used in this study is from primary beginnings. The chief beginning of information was the focal point group treatment. In add-on information was besides collected from web sites.

Chapter 2

Product Category, Market Segmentation, Target Marketing and Positioning

This chapter describes the class of the selected merchandise. The chapter is organized into four subdivisions. Section 1 provinces under which class the merchandise falls. Section 2 describes how Unilever Bangladesh Ltd. differentiates the population and categorise them into different sections. Section 3 analyzes which section the company marks and why they target that specific section. Finally subdivision 4 describes the procedure through which the company tries to capture a topographic point in the purchasers mind i.e. the merchandise positioning method.

2.1 Product Class:

LUX falls under the class of toilet articles merchandise as a beauty soap.

2.2 Market Cleavage:

The company claims that LUX is the highest selling beauty soap in Bangladesh. Furthermore some study studies besides reveal the same consequence.

Though LUX is the highest selling beauty soap in Bangladesh, it does non travel for traditional mass selling. Furthermore as a beauty soap LUX does non even section its market harmonizing to gender.

Figure 2.1 ( P-9 ) shows that Unilever Bangladesh Ltd. segments their market harmonizing to geographical countries. The population of the state is segmented into three parts which are urban, sub urban and rural country consumers.

The company farther distinguish the geographical sections harmonizing to Socio Economic Cluster ( SEC ) i.e. instruction and Income. The Table 2.1 ( P-9 ) overleaf shows the Socio Economic Clusters the company uses.

The SEC divides the population in five sections get downing from A to E, where A categorizes the extremely educated and high income earners holders, and consecutive in falling order E categorizes the antonym.

2.3 Target Market:

Figure 2.1 ( P-9 ) shows that urban and sub urban in-between category, and rural hapless people are the largest portion of Bangladesh population. A research carried out by Unilever Bangladesh reveals that urban rich people are more likely to purchase imported and expensive merchandises. Furthermore rural hapless people tend to purchase inexpensive merchandises even without measuring its quality. However urban and sub urban upper center and in-between category people tend to purchase low-cost and quality merchandises.

LUX is non a extremely expensive but an low-cost merchandise. That is why the company targets urban and sub urban upper center and in-between category people who are the 2nd highest population of section of the state. From the cleavage of client harmonizing to SEC they target class A, B and C, because they are assumed to be financially comfortable and can afford to purchase LUX.

2.4 Merchandise Placement:

Unilever Bangladesh Ltd obtained a good place in the purchasers ‘ head through better merchandise properties, monetary value and quality, offering the merchandise in a different manner than the rivals do. The company offers improved quality of merchandises in the industry at an low-cost monetary value with high stigmatization, which finally helps to place the merchandise in the purchasers ‘ head as the best quality beauty soap.

The market portion of the company in the beauty soap industry is someplace about 43 % .Since in the beauty soap industry all merchandises are of same monetary value Unilever can non supply its consumers with better monetary value but it is in a great place in mention with its packaging, aromas and merchandise designing.

A positioning map of the company is shown Figure 2.2 ( P-10 ) to depict LUX ‘s place in the consumers mind on two dimensions, monetary value and quality.

Figure 2.2 ( P-10 ) has been drawn with information gathered by carry oning a consumer study. It states that though in comparing to its rivals the pricing of LUX is same but consumers rate it as the merchandise which gives them the highest quality. This placement created a strong client trueness for LUX, for which it the market leader in the industry.

Chapter 3

Using the Tactical Selling Tools

This chapter describes the manner Unilever Bangladesh Ltd. use the tactical selling tools for marketing LUX in Bangladesh. The chapter comprises of four subdivisions. Section 3.1 discusses the merchandise attributes of LUX. Section 3.2 visualizes the monetary value of LUX harmonizing to different size. Section 3.3 conceptualizes the distribution channel of Unilever Bangladesh Ltd. This subdivision includes a tabular array that shows the location of the company ‘s warehouses all around the state. Finally subdivision 3.4 discusses the promotional activities that the company undertakes for LUX.

3.1 Merchandise:

LUX is an internationally celebrated beauty soap trade name of Unilever. Though manufactured in Bangladesh for the local market by Unilever Bangladesh Ltd, as an international trade name, it maintains an international quality for the merchandise. Formula given by Research and Development sections in foreign states, LUX is produced in Bangladesh from imported natural stuffs like Na soap, glycerin and different infusions harmonizing to spirits, coming from Unilever workss situated abroad.

LUX is offered in Bangladesh in six different spirits which are: LUX Energizing Honey, LUX Golden Glow, LUX Nature Pure, LUX Orchid Touch, LUX Almond Delight and LUX Aqua Sparkle. Taking into history the convenience of its clients, the company manufactures all spirits of LUX in three different sizes, 40gm, 80gm and 120gm.

3.2 Monetary value:

Though Unilever Bangladesh gives its LUX clients a batch in footings of the merchandise itself, it can non supply a better pricing. This is due to some restraints in the beauty soap industry. Beauty soap is a merchandise with a vulnerable demand in Bangladesh. A alteration in monetary value has a high hazard of making monetary value war among the challengers which will finally do a loss of net income. Its monetary values are about equal to its rival. Table 3.1 ( p-10 ) compares Lux ‘s monetary value with its major rival. Company carries out research on rivals ‘ monetary value and trade name trueness when it feels utmost necessaity of chaging monetary value. The trade name trueness trial is an exploratory research which is known as Brand Health Check-Up ( BHCU ) .

3.3 Topographic point:

Unilever Bangladesh Ltd. has a immense distribution channel for LUX all over the state as its gross revenues reach more than 10 million pieces a twelvemonth. The company has six immense warehouses, one in each division of Bangladesh, where the merchandise goes after they are manufactured at Kalurghat mill. Table 3.2 ( P-10 ) shows the location of its six warehouses in Bangladesh.

The company does non utilize its ain fleet of conveyance for administering its merchandise. However, it has outsourced its distribution procedure to assorted 3rd party distributers, entirely dedicated to Unilever Bangladesh Ltd. These distributers so provide the merchandise all over Bangladesh to a immense figure of retail merchants. Even though LUX targets the urban and sub urban center and upper in-between category people they are administering their merchandises all over Bangladesh because of a recent addition in demand of its merchandise to all sections of the population.

3.4 Promotion:

Unilever Bangladesh undertakes immense promotional activities to advance LUX which has topped the beauty soap industry of Bangladesh. It spends about 20 % to 25 % of its Net Returns from Gross saless ( NPC ) of LUX for promotional activities for LUX 1

It ‘s certain one-year promotional runs like LUX Channel I Superstar and LUX Channel I Annual Cinema Awards has made the merchandise a portion of the glamour universe. Since the 1930s, over 400 of the universe ‘s most arresting and sensuous adult females have been proudly associated with Lux advertizements. They do non merely advance LUX in Bangladesh for the beauty witting females, it besides promotes the trade name for males and the company proved that, by including universe celebrated male famous person Shahrukh Khan for their advertisement run.

Unilever Bangladesh Ltd spends a immense sum of money for advancing LUX through Television commercials, newspaper advertizements and hoardings. Furthermore it besides undertakes little promotional runs at different schools, colleges, universities and recreational Parkss with victors of its Zonal Beauty Contests. Till now promotional activities of LUX has ever been successful which has made it a family common name and helped it reach about one billion taka sale value in the twelvemonth 2004 2.

Chapter 4

Analyzing the Market for LUX

For better comprehension of Unilever Bangladesh, its selling scheme, merchandise quality, positioning and arrangement, we present here a comparative analysis of its rivals. This portion of the study illustrates the market portion of different companies in the beauty soap industry.

4.1 Market Share:

The beauty soap industry in Bangladesh consists of merely seven major manufacturers. Unilever Bangladesh Ltd is runing in the industry with its universe celebrated trade name LUX. Out of these elephantine companies Unilever Bangladesh Ltd is the market leader with a portion of around 43 % .

Figure 4.1 ( P-11 ) shows the market portion of all the companies in the sector. Unilever Bangladesh Ltd is taking the market. The other rivals are really competitory among themselves but they can non set a intense competition with Unilever Bangladesh Ltd, as they have market portion much less than Unilever Bangladesh Ltd.

Table 4.1 ( P-11 ) overleaf shows a elaborate description of the major rivals in the market, their operating trade name, estimated one-year gross revenues gross and market portion.

Other companies in the industry are non every bit large as Unilever Bangladesh Ltd but they are presenting menace to the company by a inclination of a gradual addition in their market portion. Kohinoor Chemicals which is runing with the trade name name Tibet is an highly celebrated trade name to the rural section of the population and possess a important portion in that section which is the largest population group in Bangladesh. Furthermore Keya Cosmetics Ltd runing with the trade name name Keya and Marks & A ; Allys Ltd runing with the trade name name Aromatic are besides originating trade names to both the rural and sub urban section of the population.

Furthermore a recent coup d’etat of Aromatic by transnational consumer merchandise giant MARICO who operates with celebrated trade names in other industries like Parachute Coconut Oil is presenting to be a menace to Unilever Bangladesh ‘s market portion.

Chapter 5

Decision

The beauty soap industry of Bangladesh consists of a few manufacturers in the industry. The demand for this merchandise is really much vulnerable in footings of pricing. Unilever Bangladesh is supplying LUX. at a monetary value which is low-cost to most of the people in the state. Beauty soap is an uprising merchandise in Bangladesh as a greater part of the population, both male and female, are now acquiring more beauty witting. As a transnational company Unilever Bangladesh with heavy promotional activities, has been able to perforate the market.

With six different aromas, three different sizes, international criterion and high quality design, as a merchandise, LUX has been extremely successful over the old ages. Its distribution procedure is extremely efficient. Its promotional activities, like the beauty competition has been a milepost in pulling a immense figure of clients. Overall with its selling activities LUX has been a successful trade name.

The lone topographic point where challenger companies are come oning is in giving clients salvation offers. Research revealed that Bangladeshi clients are extremely attracted to this kind of offers. These offers are non sustainable in the long tally but still it takes off a considerable portion of LUX ‘s sale in the short tally.

Chapter 6

Recommendation

In this chapter the squad would propose some recommendations to Unilever Bangladesh Ltd. to follow more successful operation in Bangladesh. Since a immense part of the rural hapless people is demanding LUX in recent yearss, Unilever Bangladesh Ltd should spread out their mark market besides towards the rural people. They should besides carry on different promotional activities in rural carnivals and socially responsible promotional activities to pull rural consumers and societal consciousness.Because Lux has different skin type soap so now if they provide different types of beauty soaps for male and female soapunder the same trade name name i.e. LUX it might increase their gross revenues. Last, as Bangladeshi civilization kids have a immense say in shopping so they should besides advance the merchandise to kids like their another trade name “ Dove ” . These are the recommendations suggested by teem members to Unilever Bangladesh Ltd. to follow for a more successful operation in Bangladesh with big market portion.

Appendixs

Urban Rich

Urban and Sub Urban Upper Middle and Middle Class

Rural Poor

( Figur2.1 ) : Market Segments 1.

Socio Economic Bunchs

A

Bacillus

C

Calciferol

Tocopherol

Income

High Income

Upper Middle Level Income

Mid Level Income

Lower Middle Income

Low Income

Education

High Degree of Education

Educated Slightly Less than Cluster Angstrom

Educated Slightly Less than Bunch B

Educated Slightly Less than Cluster C

Very Low Level of Literacy

( Table 2.1 ) : Socio Economic Cluster Segmentation 1

( Figure 2.2 ) : Positioning Map

Trade name

Lux

Aromatic

keya

Thibet

( Table 3.1 ) : Comparative scenario of soaps monetary value

Division

Location of Warehouse

Dacca

Dhaka City

Chittagong

Kalurghat Heavy I/A

Sylhet

Sylhet City

Rajshahi

Rajshahi City

Khulna

Khulna City

Barisal

Barisal City

( Table 3.2 ) : Location of Unilever Bangladesh Ltd ‘s Divisional Warehouses 1.

( Figure 4.1 ) : Market Share

Sl. No.

Company

Brand Name

Annually Market Share on Toilet Soap

1

Unilever ( BD ) . Ltd

Lux International Beauty Soap

Tk. 312 Core

43.33 %

2

Square ( Toiletries Division )

Meril Beauty Soap

48 Core

6.66

3

Keya Cosmetics Ltd.

Keya Beauty Soap

72 Core

10.00 %

4

Aromatic Cosmetics Ltd.

Aromatic Beauty Soap

48 Core

6.66 %

5

Lily Cosmetics Ltd.

Lily Beauty Soap

72 Core

10.00 %

6

Kohinoor Chemical Co.

Tibet Beauty Soap

72 Core

10.00 %

7

Marks & A ; Allys Ltd.

Camelia Beauty Soap

60 Core

8.35 %

8

Others

36 Core

5.00 %

Entire Market

720 Core

100 %

( Table 4.1 ) : Estimated Annual Gross saless Revenue and Market Share.

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