Alexander James-Gray

Johnson & Johnson in the Philippines

Problem: Currently J & J is only experiencing marginal sales and profits due to political
unrest, conservative marketing, and limited product introduction planning. Management
believes that initial modest sales and profits are sufficient in the short term, and that
improving confidence and acceptance of J & J in the Philippine marketplace through
strategic growth opportunities is most important to its success. The marketing team seeks
to grow the brand by developing new products and improving product line extensions.
Strategies:
1) Target urban females, 16 to 25 years old, from AB and C category households:
This course of action emphasizes that young adult women are using either talcum
or baby powder to freshen their faces. The data shows that 80% of talcum users apply it
to their face. Further, data shows that 60% of the population is under the age of 25. The
target distribution channel is supermarkets and key slogan is, “Because the baby is now a
lady.”
This is a limited strategy, because only 18% of the population falls within the 16
to 25 year old age range. Further, the AB and C economic classes only account for 7.8%
of the Philippine households. Without any understanding of who is making the
purchasing decisions, the slogan may be targeting the wrong audience. Young women
will not remember using baby powder as children, so will not be influenced to purchase
the line extension.
2) Target young adult & adult urban females from AB and C category households:
This course of action will broaden the reach of the product line extension to
include nearly 50% of the population. While the youth market is the most rapidly
growing segment, the opportunity to capture adults currently using baby powder in their
compacts offers a substantial growth opportunity. Further, mothers will not oppose the
young adults’ use of “cosmetic” face powder from compacts when they see the
compacts’ purposing for its face freshening characteristics over cosmetic uses.
3) Target all current baby powder users with rebranded “ face freshener” product:
This course of action would maximize current capabilities without requiring any
behavioral changes. Adult women are used to using less-expensive baby powder to refill
old compacts and young adult women are only upset with the branding of the powder as
a “baby” product. Through a slight repackaging and branding campaign, J & J could
market its new “face freshener” product and create a product category women are
familiar with while satisfying their needs. However, this strategy limits the growth
opportunities and margins within the compact category.
Recommendations and Implementation:
Option two is most in line with J & J’s goals of creating margins using innovation
and product line extension. They will have first mover advantage in the “face freshener”
category and can modestly generate sales and profits as intended. Point of sale displays
in the supermarkets coupled with proposed television campaigns will target the young
adult and adult urban female targets. The slogan can remain the same if mothers are
purchasing “face freshener” for their daughters. However, young adult purchasers will
require a different marketing appeal showing the convenience of a compact and how this
product makes their current powder-in-tissue behavior even easier. J & J could try a
slogan such as, “No more spills, just refills.”