Pricing

PRICING - Setting the right price is an important part of effective marketing . It is the only part of the marketing mix that generates revenue. Price is also the marketing variable that can be changed most quickly, perhaps in response to a competitor price change. 

HINDUSTAN  UNILEVER  claims  to  practice value-based  pricing in which the customers’ perception of the product’s price provides a starting point for developing the marketing mix of the product. The research department determines this price usually by using focus groups.

The price of Re 1 and 2 for Sunsilk shampoo sachets shows how the price also reflects a concern to make the purchase more convenient. Sunsilk is also available in Rs 45 and Rs 169 price bottles to cater to the demands keeping in mind the wants of this particular customer segment.

 The primary importance of this value-based pricing is that the product demand will be much higher if its price is in line with the customer’s perception of its value.

Setting price strategy of sunsilk-

The pricing strategy that UNILEVER uses is product pricing strategy in which they reduce the price of the product which is being sold more and increase the price of the product which is being sold less that is they use the demand price strategy to keep its monopoly in the market for the particular type of brand product so as they become the sole competitors in the market for that particular kind of product in the market,

 for instance they use sachets of the best selling product like the pink sunslik sachets and also cheap price for the bottles and for the various kind of size bottles present in the market. They try to use a monopoly state of market as to remain the only market player for the variety of same brand products they use and make and to be the sole market leaders. The internal factor that affects the pricing decision of sunsilk is based on marketing strategy, objectives and mix. The sunsilk Company mostly is working on the market of women’s personal care. 

Besides, sunsilk is also price maker and spends a lot of money in advertisements to convince their customers. Last but not least is the competitor’s strategies and price. The competitors of sunsilk are dove, Rejoice, Pantene, L’Oreal and so on. 

Setting Product Strategy

Value based pricing- is a pricing strategy which sets prices primarily, but not exclusively, on the value, perceived or estimated, to the customer rather than on the cost of the product or historical prices. One crucial concern for value-based pricing is strict management of cost in order to be able to make a profit at the value-based price.

Sunsilk is providing value based pricing to the customers. Sunsilk fix the price of products according to the areas. Like in the all countries the price of Sunsilk shampoos are not same, It is different in India and different in the New Zealand. So every type of customers are happy with the prices of its products. So with the valuable prices of the shampoos and conditioners Sunsilk is making customers happy and they also making profits by selling products more than its competitors

Product features and quality- Sunsilk is very conscious about its customers so, Sunsilk make quality products and the company has maintained good social and environmental standards in the market. Sunsilk offers a range of affordable, quality hair care products that suit individual hair types. With quality ingredients and innovative new formulations Sunsilk has created richer shampoos, thicker, creamier conditioners and an impressive range of styling products to provide simply beautiful hair.

Service mix and quality- A selection of services developed to offer customers a choice within a particular range. 

Sunsilk offers the service and quality of its product by providing soft &smooth shampoo for softening the driest and roughest hair

Product Mix and Product levels

PRODUCT MIX

Product mix or product assortment refers to the number of product lines that an organisation offers to its customers.

Product line is a group of related products manufactured or marketed by a single company. Such products function in similar manner, sold to the same customer group, sold through the same type of outlets, and fall within a same price range.   

Sunsilk is manufactured by Unilever. HUL is India's largest marketer of Soaps, Detergents and Home Care products. It has the country’s largest Personal Products business, leading in Shampoos, Skin Care Products, Colour Cosmetics and Deodorants. HUL is also the market leader in Tea, Processed Coffee, branded Wheat Flour, Tomato Products, and Ice cream, Soups, Jams and Squashes. Any company’s product mix has four dimensions:  we see the product mix width, length, depth and consistency.

Product width- The number of different product lines the company carries. HUL carries a wide variety of product lines. Home care,  personal wash, foods & Beverages. These are categories in which HUL sells its products through various items.

Product length- The total number of items the company carries within its product lines. 

Product Depth- Assortment of size, color and models offered in each item of a product line. 

Product consistency-  It refers to the relationship of various product line either in their end use, production requirement, distribution channel or other way.

for example- HUL manufacturer of various hair care products like Sunsilk, Clinic plus, clear, dove all of these have separate production requirement, have different distribution channel compared to Sunsilk. 

PRODUCT LEVELS

CORE BENEFIT- The core benefit that the sunsilk brings towards its customers is that it makes their hair clean and healthy and gives nourishment.

BASIC PRODUCT- This represents all the qualities of the product. It fulfils the core benefit.  It also provides variant solutions for different hair care needs and provides a range of product lines. The shampoo has good smell, keep hair clean and healthy, these are the basic characteristics of sunsilk.

EXPECTED PRODUCT- This is about all aspects the consumer expects to get when they purchase any hair care product according to their hair texture and requirements. Customers expectations from sunsilk shampoo that it gives smoothening of hair, to prevent hair fall, black shiny hair, to construct damaged hair.

AUGMENTED PRODUCT- This refers to all additional factors which sets the product apart from that of the competition. And this particularly involves brand identity and image.

The augmented aspect of it is the fact that the packaging is nicely integrated, assurance of proper hair treatment is guaranteed and an after-sales service which is observed to answer all the customers’ needs. 

POTENTIAL PRODUCT- This is about augmentations and transformations that the product may undergo in the future.

PRODUCT HIERARCHY -

Each product is related to certain other products. The product hierarchy stretches from basic needs to particular items that satisfy those needs. There are 6 levels of the product hierarchy:

1. Need family:

The core need that underlines the existence of a product family.

Need family for sunsilk- personal care

2. Product family:

All the product classes that can satisfy a core need with reasonable effectiveness. For example, all of the products like computer, calculator or abacus can do computation.

Product family- hair care

3. Product class:

A group of products within the product family recognised as having a certain functional coherence. For instance, personal computer (PC) is one product class.

Product class- Shampoo

4. Product line:

A group of products within a product class that are closely related because they perform a similar function, are sold to the same customer groups, are marketed through the same channels or fall within given price range. For instance, portable wire-less PC is one product line.

Product line- Sunsilk

5. Product type:

A group of items within a product line that share one of several possible forms of the product. For instance, palm top is one product type.

Type- variants like yellow colour- dream and soft sunsilk shampoo, pink colour- lusciously thick and long shampoo, orange colour- damaged hair reconstruction shampoo, blue colour- anti dandruff shampoo etc.

6. Item/stock-keeping unit/product variant:

A  distinct unit within a brand or product line distinguishable by size, price, appearance or some other attributes. For instance, LCD, CD- ROM drive and joystick are various items under palm top product type.

Items- SKU, 50ml, 100ml, 350ml etc

Marketing Mix Elements

The marketing mix refers to the set of actions, or tactics, that a company uses to promote its brand or product in the market. The 4Ps make up a typical marketing mix - Price, Product, Promotion and Place.

PRICE - refers to the value that is put for a product. It depends on costs of production, segment targeted, ability of the market to pay, supply - demand and a host of other direct and indirect factors.

The price of sunsilk shampoo sachets shows how the price also reflects a concern to make the purchase more convenient, since the rupee is denoted in this value. It is available from Rs 3 sachets to 200ml of Rs 95. Sunsilk has maintained its price reasonable and their prices are much lower than P&Gs.

PRODUCT - refers to the item actually being sold. The product must deliver a minimum level of performance; otherwise even the best work on the other elements of the marketing mix won't do any good. 

Sunsilk is one of the  widely preferred brand shampoo in India. Sunsilk consists of dream soft & smooth, stunning black shine, thick &long, anti dandruff.

PLACE - refers to the point of sale. In every industry, catching the eye of the consumer and making it easy for her to buy it is the main aim of a good distribution or 'place' strategy.

Sunsilk is available in super markets, sari-sari stores, convenience outlets, drug stores, market stalls, nationwide, pick up by customer

PROMOTION – This refers to all the activities undertaken to make the product or service known to the user and trade. This can include advertising, word of mouth, press reports, incentives, commissions and awards to the trade.

Sunsilk promotes its shampoo through various advertising in television, print media, music videos, internet rural campaign. Promotion of the products in the sunsilk range through movies such as “Fashion” Sunsilk has come up with a new promotional campaign GOOD HAIR DAYS in six major cities in collaboration with famous hair stylists of the country.

Product Life cycle

Product life cycle (PLC) is a portrayal of the life of a product in the market attempting to capture the dynamics of a brand from the perspective of business/commercial costs and sales measures. Product Lifecycle has 5 stages through which a product or its category bypass, from its development to introduction to the marketing, growth, maturity to its decline or reduction in demand in the market.

Sunsilk was launched in India in 1964 and it grew with the growth in the hair care industry, specifically the shampoo market, in India, launching a number of product variants.

Steps taken by Sunsilk at each stage

·         INTRODUCTION - The introduction stage of the product life cycle is where a new product is launched into a market.

Sunsilk was launched as a cosmetic beauty shampoo, and was positioned the same way during its initial years in India. Sunsilk began its publicity efforts in 1955 with an advertising campaign that focused on specific hair "issues".

OPPORTUNITY- In its early years in India as well, Sunsilk focused much of its marketing attention to position the product as a beauty shampoo.

·         GROWTH - In the growth stage of the product life cycle, the market has accepted the product and sales begin to increase.

In the early 1970s, Sunsilk was advertised with the punch line “All you need is Sunsilk”. In its growth stage, the communication of Sunsilk was focused on different product variants and promoting the use of Sunsilk conditioners.

Within ten years of its launch in India, Sunsilk introduced a tonic shampoo for dandruff, which was the first anti-dandruff shampoo in India. In the subsequent years, it launched many shampoo variants such as Sunsilk Silky and Straight Shampoo, Sunsilk Care & Repair Shampoo, Sunsilk Hydra, Sunsilk for Hair Damaged by Daily Wear and Tear. Sunsilk also came out with its range of hair conditioners such as Sunsilk Daily Repair Conditioner and Sunsilk Soothing Conditioner.

·        MATURITY- In the maturity stage of the product life cycle, sales will reach their peak.

Sunsilk attained maturity as a global brand, with its products being sold in 69 countries. To prolong the set in of the decline stage, Sunsilk went for Brand rejuvenation in 2003 and came out with “SUNSILK NATURALS”.

From 2009, Sunsilk has started working with a number of professional hair experts to develop new and improved products. Each hair issue variant has been linked to an expert with the relevant specialist hair knowledge. For example, Dr Francesca Fusco, a New York dermatologist, co-created a “hairfall” variant for the brand. Sunsilk created a new look with new variants, new packaging, new advertisement and a new tagline “Life can’t wait”.
Sunsilk has managed to stand apart from its rivals. Sunsilk understands that different girls have different needs and hence has created 7 products that cater to a variety of them.

On June 17, 2006, Unilever launched Sunsilkgangofgirls.com, India's first "online all-girl community" which quickly caught the attention of the target group as it was promoted through a 360-degree media communication blitz. The site was branded space to promote Sunsilk, while at the same time it provided a social networking platform for girls. The site offers its users access to a variety of local and global experts to address various hair care needs through its content, blogs and live chat room.

COMPETITION & CHALLENGES- Sunsilk faces tough competition from the ‘sachet’ market which accounts for 70 percent of the market. Also Sunsilk still neglects the rural market which is the major chunk of the shampoo industry in the present day scenario. Further, the brand is restricting its target to 20 something women only and in hence neglecting the middle aged customers. They have also lost a huge segment of male users by naming them ‘Desperate Guys’.

·        DECLINE- In the decline stage of the product life cycle, sales will begin to decline as the product reaches its saturation point. Most products are phased out of the market at this point due to the decrease in sales and because of competitive pressure. The market will see the product as old and no longer in demand.

SUNSILK is in its maturity stage, as it already made its impact on the market and is still far away from the decline stage.

CONCLUSION

In the early years, Sunsilk focused much of its marketing attention on gaining international presence. A new campaign was launched to recruit younger users. The new products focused on hair color, texture, feeling, dryness, etc. The updated Sunsilk campaign, "Get Hairapy", followed the same strategy, marking a bold move towards users in their 20s and upwards said to be in their "quarter-life crisis". Around 20% of the brand’s current users are new users after repositioning while 40% are brand loyal. The brand is also approaching the rural areas with “Sunsilk Sahelian”.

Competition

Competition is the rivalry in which every seller tries to get what other sellers are seeking at the same time: sales, profit, and market share by offering the best practicable combination of price, quality, and service. Where the market information flows freely, competition plays a regulatory function in balancing demand and supply.

Knowing who the competitors are, and what they are offering, can help to make the products, services and marketing stand out. It will enable to set your prices competitively and help to respond to rival marketing campaigns with their own initiatives.

Companies strive to increase sales volume by utilizing the 4 components of the marketing mix, also referred to as the 4P's: product, place, promotion, and place.

DIFFERENT TYPE OF COMPETITORS IN MARKET

DIRECT COMPETITORS -
A direct competitor is another company that offers the same products and services aimed at the same target market and customer base, with the same goal of profit and market-share growth.

The major competitor of Sunsilk in the rural areas is Bio Amla while in the urban areas, Sunsilk faces cutthroat competition with P&G.

 Head and shoulders,  pantene.  In urban areas, Sunsilk is acting as a market challenger against P&G.  Sunsilk has got the advantage of keeping their prices lower than P&G shampoos but P&G has captured a bigger share of the market due to its intense promotional activities.

Sunsilk shampoo is at par lower with major competitors in 200ml. Sunsilk cost Rs75, pantene Rs104, head & shoulders Rs 104, Dove starting Rs 129.

INDIRECT COMPETITORS –

Indirect competitor is another company that offers the same products and services, much like direct competitors; however, the same end goals are different. These competitors are seeking to grow revenue with a different strategy. Nearly every company is involved with some form of indirect competition.

Indirect competitors of Sunsilk –  clear, rejoice , clinic plus

REPLACEMENT COMPETITORS –

A replacement competitor is something someone could do instead of chooses your product. But they’re using the same resources they could have committed to your product.

Replacement competitors- Chick shampoo.

Buying Decision Making Process

BUYING DECISION PROCESS:

A buying decision process describes the process a customer goes through when buying a product. Consumer goes through various stages before buying any product or it could be that for some products which they start using it on regular basis doesn’t always pass through all five stages, they may skip or reverse some.

Consumer’s buying behavior and resulting purchase decision are strongly  influenced by many factors  such as -

Cultural factors include consumer’s culture, sub culture and social class. These factors are often inherent in our value and decision processes.

Social factors include groups, family, roles and status. This explains the outside influences of others on purchase decision either directly or indirectly.

Personal factors include variable such as age and lifecycle stage, occupation, economic circumstances, lifestyle, personality, self concept. These may explain why our preferences often change as our situation changes.

Psychological factors include affecting our purchase decision include motivation, perception, learning, beliefs and attitudes.

There are 5 stages which a consumer often goes through when he/she around their Purchase. These stages also exist because of normal human psychology.