Marketing Research Proposal 4 Lakme Lipsticks

Submitted by: Group No.9 (Sec B) Kritika Baghel Kushal Parwani Indu J Nandini Sudheer Noopur Khare (12084) (12085) (12091) (12092) (12093)

Sulgadle Manjunath

(12112)

Table of Contents
1. Executive Summary ............................................................................................................................ 1 2. Industry Background ........................................................................................................................... 1 Cosmetic ............................................................................................................................................. 1 Lipstick ............................................................................................................................................... 1 Trends in Mysore ................................................................................................................................ 1 Size of the market ............................................................................................................................... 2 Lakme ................................................................................................................................................. 2 3. Organizational Context ....................................................................................................................... 3 Research Objective ............................................................................................................................. 3 Information Requirement Planning .................................................................................................... 4 4. Research Design.................................................................................................................................. 5 Type of research.................................................................................................................................. 5 Research Plan ...................................................................................................................................... 5 Research Approach ............................................................................................................................. 5 Research Methodology ....................................................................................................................... 6 5. Sampling Plan ..................................................................................................................................... 6 Sample ................................................................................................................................................ 7 Sample size ......................................................................................................................................... 7 6. Data Analysis ...................................................................................................................................... 7 Sample Table ...................................................................................................................................... 7 Dummy Table ..................................................................................................................................... 7 7. Cost and Time Estimates .................................................................................................................... 8 Time .................................................................................................................................................... 8 Cost ..................................................................................................................................................... 8

1. Executive Summary
Like all emerging markets, the trends of India's cosmetics industry are expected to follow those of the more advanced countries For example; an expected growth in natural and organic cosmetics will have an impact on the existing market scenario. Local players are dominating the natural cosmetics sector providing cheaper natural alternatives to standard beauty products and foreign brands, according to the recent market research. The cosmetics market has been growing at the rate of 15-20% for the last few years. The sector has witnessed growth mainly from medium and low priced category that accounts for majority revenue share of the cosmetic market. In this context, we are formulating a study on the market acceptance and consumer preference of a lipstick brand, Lakme. We plan to conduct the study in Mysore to know the various factors like customer purchase criteria and preference, their loyalty towards the brand Lakme and the potential customers and their purchase behaviour. Focussing on quantitative and qualitative approach on a representative sample, we expect to arrive at conclusions which can be recommendations or suggestions that the company can adopt.

2. Industry Background
Cosmetic
Any substance or preparation intended to be placed in contact with the various external parts of the human body (epidermis, hair system, nails, lips and external genital organs) or with the teeth and the mucous membranes of the oral cavity with a view exclusively or mainly to cleaning them, perfuming them, changing their appearance and/or correcting body odours and/or protecting them or keeping them in good condition.

Lipstick
Lipstick is a cosmetic product containing pigments, oils, waxes, and emollients that applies colour, texture, and protection to the lips.

Trends in Mysore
Lipsticks are available throughout Mysore. People usually buy these in malls, shopping areas like Devaraja Urs road and in few other exclusive outlets and saloons. Mysore being an educational hub, lot of students comes here to study. It has also started housing more number of industries where these students get jobs. The city being a cultural capital of Karnataka, lot of functions do happen in Mysore. On such special occasions, attendees of these functions tend to wear lipsticks. Hence, cosmetic products like lipsticks find its place in consumer market for office goers, college students and housewives.

Size of the market

The cosmetics market in India is valued at Rs.1514crore. The size of India's colour cosmetics market is Rs.250crore that of fragrances is Rs.85crore while the skin care market size is larger at Rs.400crore. While lipsticks account for nearly a third of the colour cosmetics market at Rs.90 - Rs.100 crore, the market for nail enamels is estimated at around Rs.110crore. The remainder consists of products such as mascara, eye-liners etc. The most selling lipstick brands in Mysore and their price ranges are as follows: Brand Name Lakme Loreal Maybelline Revlon Oriflame Price Range Rs.350 Rs.600 Rs.600 Rs.900 Rs.200 Rs.400 Rs.500 Rs.600 Rs.250 Rs.450

Lipsticks are usually sold in beauty shops (Health & Glow), fancy stores, supermarkets (Big Bazaar, More), branded retail outlets (Shoppers Stop). People also go for online purchase through websites like www.flipkart.com, www.ebay.com etc. In order to study the lipstick market in detail, we have chosen our brand as Lakme.

Lakme
Lakme is an Indian brand of cosmetics, owned by Hindustan Uniliver. Lakme started as a 100% subsidiary of Tata Oil Mills (Tomco), part of the Tata Group; it was named after the French opera Lakme, which itself is the French form of Lakshmi, the goddess of wealth, also renowned for her beauty. Indian cosmet Lakme was started in 1952. Lakme produces cosmetics as well as skin and hair care products. This leading Indian cosmetic brand has its own, Lakme Beauty Salons and exclusive Lakme product outlets all over the country. Lakme's share stands at 34 %. Lakme is the overall market leader in the colour cosmetic segment (lip care and nail enamel) with a wide range of products and prices, both. Lakme leads the market with sales of Rs.100 crore. Lakme has recently joined forces with Hindustan Lever Limited (HLL) and calls itself Lakme-Lever.

The recent trends in Lakme are the range of absolute products which also includes absolute lipsticks. The tag line of Lakme absolute products has caught the attention of many regular buyers. It says Make up which doesnt look made up. These products are at a slightly higher price as compared to regular Lakme products. Users go for this product because it finely blends with the skin.

3. Organizational Context
A study is to be conducted to help Lakme identify key drivers that make a difference on consumers brand choice and purchase behaviour and develop marketing tactics that lead to brand growth.

Research Objective
To examine the consumer preference and purchase behaviour of Lakme lipsticks versus other brands in Mysore city. We are primarily examining the users and non-users of Lakme lipstick. This will include measurements of awareness, attributes affecting customers choice, brand attitudes, perceptions and purchase intent of the women in Mysore city. These parameters can be measured as follows: Awareness: This can be tracked through measures of brand recall and recognition. Attributes affecting customers choice: This is captured through specific questions. Brand attitude and perception: This is captured through questions related to brand image and associations that consumers develop based on their experience with the brand. Purchase Behaviour- It includes the frequency of purchase and the purchase points.

Information Requirement Planning

Type of data Primary Data Respondents Information Measurement Scale Nominal Ordinal Interval

Students (college) Working Women Housewives Beauty Parlour (Beauticians) Shops (cosmetics)

Brand preference Attributes (personal and of product) affecting the choice Awareness among consumers Frequency of purchase Usage Place of purchase Occasions Brand perception Influential element Frequent users

Secondary Data

Recent Research report Websites (flipkart.com, lakmeindia.com)

Size of the cosmetic and colour cosmetic industry Names of various existing lipstick brands Price range Distribution channel Consumer statistics (age, income, etc.)

4. Research Design
Type of research
We are going by a partly exploratory research and a partly descriptive approach. It is exploratory because the market is new and emerging, and there is rarely any previous study done exclusively for lipsticks. We start with a preliminary notion of the objective of our study and of its context. During the exploratory research project, these provisional concepts gradually gain precision. It is also partly a descriptive approach as we have formulated certain hypotheses on a prior basis and the questionnaire etc. can be structured or planned beforehand. Focussed research will be done to explore and understand the attitudes of potential customers towards other brands.

Research Plan
We are planning to have In-depth interview which will help us to know or form a profile of consumers who uses Lakme lipsticks in Mysore.

Research Approach
We formulate hypothesis and conduct tests of significance. H0: Null hypothesis H1: Alternative hypothesis The hypotheses being tested in this report are: H0: Proportion of people using Lakme brand of lipsticks is same as proportion of people using other brands. H1: Proportion of people using Lakme brand of lipsticks is not same as proportion of people using other brands. H0: Respondents choose other brands over Lakme due to the price factor. H1: Respondents do not choose other brands over Lakme due to the price factor. H0: There is significant difference among different age groups attitude towards Lakme. H1: There is no significant difference among different age groups attitude towards Lakme. H0: There is a relationship between occupation and brand preference of the consumers. H1: There is no relationship between occupation and brand preference of the consumers.

H0: There exist a correlation between income range and frequency of purchase/usage. H1: There exist a no correlation between income range and frequency of purchase/usage.

The hypothesis testing will be done using chi-square tests. These hypothesis test results will give us ample information to come to a conclusion about the brand loyalty, overall satisfaction level etc. With this conclusion drawn, we can make recommendations to the company as to how to improve their brand recognition and acceptance and make changes if needed to the current promotion practices.

Research Methodology
We have decided to collect information mainly through following ways: Through questionnaires. Realising the immense potential of internet we are also planning to conduct an online survey as well, covering 10%-15% of the total sample size.

In addition to it, we will also be conducting a brand recall test which will enhance the value of our research.

5. Sampling Plan
We are doing sampling in two stages. Firstly, we are using random sampling, to select strata, which are: Colleges- SDM College for women Shopping malls- Mall of Mysore, Reliance Mart, MORE, Big Bazaar Residential Areas- Siddartha Nagar Offices- Infosys office Shops- DD Urs Road shops Beauty parlour-

After selecting our strata we will use convenient sampling to select our respondents. They will be selected on the basis of: Number of respondents required of particular age, occupation, salary, etc. People willing to respond Lipstick users Depending on the acquaintances

Sample Respondents Students Working Women Housewives Beauticians Shopkeepers Percentage 25% 35% 20% 10% 10%

According to our proposed research plan, our sample for consumers will be divided on the basis of income, age group and occupation. Our respondents will be from the urban Mysore.

Sample size
We have selected a sample of 100150 for our study, from the target population.

6. Data Analysis
Sample Table
The data collected through the survey will be analysed in the following ways: Descriptive statistics: weights and variance estimation Analytic statistics

Many different statistical tools will also be used for analysing the data.

Dummy Table
Brands Preferred Not Preferred Avon Lakme Mac Maybelline Revlon Others

Age Group\Occupation
Below 25 25-34 35-44 45-54 55 & above

Students

Working Women

Housewives

Beauticians

Shopping/Occupation
Students Working Women Housewives Beauticians

Malls

Fancy stores

Supermarkets/retail

E-shopping

Income

Number of consumers preferring Lakme

Number of consumers preferring other than Lakme

Below Rs.150000 Rs.150000 - Rs,300000 Rs.300000 - Rs.500000 Rs.500000 & above Income Below Rs.150000 Rs.150000 - Rs,300000 Rs.300000 - Rs.500000 Rs.500000 & above Frequency of usage Frequency of purchase

7. Cost and Time Estimates

Time
The research study will be conducted over the span of one month. We are proposing the activity schedule as below: Full-fledged Proposal Report : 6 Days ( 3 Hrs./Day) Data collection : 7-8 Days(6 Hrs./Day) Analysis: 2 Days(3 Hrs./Day) Reporting : 2 Days(3Hrs./Day)

Cost
The cost of doing research has been classified into the following heads Logistics Cost including the cost of printing questionnaires. Transportation Cost.

Below is the total project costing: Parameters Printing cost Transportation Cost Recreation Miscellaneous Employee Hours Total Media Paper Bike Snacks NA Timesheet Units Price (Rs.) Fuel(litre) Hours 150 3 18 NA 6 1 75 30 NA 50 NA 3 NA NA NA NA NA NA NA 12 Total Cost(Rs.) 150 675 540 250 3600 5215

Hence, total project costs 5215 INR.

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