1.

0 SUMMARY

Skin-Tique Corporation manufactures women’s personal care products. The products consist of;
facial creams, hand and body lotions, and a full line of women’s toiletries. Soft and Silky was
positioned as a high-quality women’s shaving gel since its introduction in 1988. Phoebe
Masters, the newly appointed Product Manager for hand and body lotions at Skin-Tique,
recognized that they face some problems. Also Heather Courtright, the Soft and Silky Brand
assistant suggested them it is time for new packaging.These factors made them think about
producing a new kind of packaging. But she is not sure whether to introduce a new package
design which is aerosol package (5-1/2 ounce or 10-ounce) alongside the existing tube
container for the company’s Soft and Silky Shaving Gel product or not.If they decide to
introduce the new design, the manager needs to decide if a test market is necessary to evaluate
the new packagingto enhance their decision making capabilities. Skin-Tique could choose to
continue only offering their current non-aerosol product. This decision would remove some
uncertainty from their decision making process, but would result in numerous negative
consequences. Skin-Tique’s market research has shown that many consumers prefer an
aerosol product. If they fail to meet consumer expectations, they may face problem in acquiring
new market share, also they may lose current market share.

2.0 PROBLEM IDENTIFICATION

There are two (3) primary problems have been identified for this case study. First problem was
whether to introduce a new aerosol package design instead of tube for company’s Soft and
Silky Shaving Gel. Decision also should be made whether the company should introduce a 5 ½
ounce shaving gel or a 10 ounce for new aerosol package. Besides that, Phoebe Masters also
need to decide whether she should approve additional funds for a market test.

As for secondary problem, there are two problems have been identified. First is cannibalization
of shaving gel in tube package will be happen if aerosol packaging introduce in the market.
Moreover, working relationship between Masters and Heather Courtwright would effects on
Masters decision either to proceed or not with the proposal that given by Courtwright.

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3.0 ANALYSIS

3.1 Product Packaging Analysis

Packaging includes all the activities of designing and producing the container for a product.
Product packaging is one of important element in products marketing and generally regarded as
an essential component of modern life style and the way business is organized. Packaging
have major significance such as it is can make a product more convenient to use or store and
easier to identify. Packaging also affects product experience when they to open the package
and use the product at home. Skin-Tique produced shaving gel in tube. However, this type of
packaging is not practical anymore because aerosol container seems will make users more
convenient on using shaving products. In addition, there are many Skin-Tique competitors are
introducing shaving products by using aerosol container and this is important for this company
to introduce similar packaging design.

3.2 Marketing Research Analysis

Marketing research is the systematic design, collection, analysis and reporting of data and
findings relevant to a specific marketing situation facing the company. As part of $35,000
budget to assess consumer response to new aerosol container, Skin-Tique conducted large
marketing research firm to form a focus group studies. Research findings revealed customer
and noncustomers have unanimously in favour on shaving packaging design as well the
preferred amount to buy either 5.5or 10 ounce. Factors that influenced noncustomers from not
buying Skin-Tique products also had been determined. Besides that, research done also
revealed the information about the customer preferences on the shaving products’ price that
should be offered by Skin-Tique

3.3 Product Differentiation Analysis

To be branded, products must be differentiated between what competitors are offered. Product
can be differentiated in form of size, shape or physical structure of a product. As for Skin-Tique,
there are many competitors offered similar products likes what they have. So that, it is
important to them to differentiate their product offered for example by using different packaging
or size offered. As for Skin-Tique Corporation, different packaging and size of shaving products
will create differentiation advantages between this company with other competitors. Previously,
they just offered shaving gel in tube which for 5.5 ounce. However, demand for aerosol

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packaging also keeps increasing and due to that, the company must take into consideration to
also introduce this type of packaging.

3.4 Customer Behavior Analysis

Determine a customer preference is very important for marketers because it is often indicate
how much they are satisfied with marketers’ products. The idea on customer prefers one
product over another is not new in marketing environment. Hence, determination on customers’
preferences on products offering is very crucial because customers’ preferences may change
time over time. As for Skin-Tique Corporation, they had identified the seasonality factors affects
the preferences on shaving products. For example, women are most using shaving during
summer season. Besides that, women which working outside home is more frequent used
shaving products than those who are not. Due to that customer behaviour, of course this will
affect the demand for the shaving product.

3.5 SWOT Analysis

STRENGTH WEAKNESSES
1. Have high quality of women’s shaving 1. Just only offered women shaving gel in
gel. tube.
2. Experience in industry the since 1988
OPPORTUNITIES THREATS
1.Women lifestyle affects the demand 1. Number of competitors in the same
towardsshaving cream and gel market.
products. 2. Price competitiveness
3. Dominant packaging for women’s shaving
cream or gel is the aerosol container.

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4.0 ALTERNATIVE

There were 3 alternative in Skin-Tique Corporation.

1) Phoebe Masters can maintain with the existing product without any changes. It means
that she discard the new aerosol package design.
2) She can introduce a new aerosol package design and perform the market test which
was shown in exhibit 5 (Forecast A, B, C and D). However, she has to think about the
size (5 ½ ounce or 10-ounce). Actually her estimated cost for the market test was
$30,000, which includes the cost if gathering marketing research data on the
cannibalization rate and incremental sales growth.
3) She can introduce a new aerosol package design with 5 ½-ounce or 10-ounce and do
not perform the market test.

5.0 RECOMMENDATION

We would like to recommend Phoebe master to choose alternative 1 and 2. Alternative 1 which
makes her to maintain the existing product which is 5 ½ ounce tubes until the products
completely sold it out. Alternative 2 which makes her produces a new aerosol package design
and performs the market test with both sizes (5 ½ ounce and 10-ounce). We suggest producing
both sizes because some customers are preferring 10-ounce because of the need of products.
Besides that, they also feel that they no need to buy frequently because 10-ounce is more
quantity with reasonable price which is $4.25 per can. We suggest 5 ½- ounce to those are
noncustomers who are not aware about this products with the price of $3.50 per can. We advise
her to do market test by choosing forecast D: High estimate for 10-ounce aerosol package
addition (Shown in Exhibit 5) because the ounce volume for 5 ½ ounce tube packages
(9,600,000 ounce) and 10-ounce aerosol package (Cannibalized 1,145,175 and net new volume
1,500,000) more compare to other forecast. Why she have to do market test? We feel that only
market test make her to identify the response of customers to the new products.

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6.0 PLAN AND ACTION

First is to communicate plans with retailer to ensure a smooth route for new packaging products
to the market. This alternative entail introducing the both sizedaerosol package that would be
presented at retail alongside the smaller sized tube. It is helps customer for easy access and
looking for the products. Another alternative that can be used is placing products in the targeted
stores. Next is by developing a marketing strategy to attack the noncustomers by preparing
samples of new product pack and size in the market. Estimated the total of 20,000 units of
sample test will be issued for the purpose of trial promotion. Last is to prepare a marketing
communication strategy to promote an aerosol can package through increased advertising
including by hitting all of the local newspapers, relevant magazine that related with the women’s
careproductsand news channel. Another option that can be used is by increase in-store
promotional activity especially before and during summer season.

7.0 CONTINGENCY PLAN

When the sales for the existing product are no longer growing and profit start to fall. Necessary
actions are should be taken to avoid the losses of reducing current market price and
cannibalization on sales for tube packaging.

“Buy one get something else free” or “buy one get one free”. It is an attractive way to target
customer by offering it “free” will undoubtedly attract attention. Most customers don’t see this as
buying two items at half price. Instead, their perception is that they bought one at regular price
and we generously gave them another. For example, bring together the larger sized aerosol
package (10 ounce aerosol package) with smaller sized tube (5.5 ounce tube package) in the
same box. In additional, run a contest to attract the customer buys the new product in order to
increase the sales for an aerosol can package. People love free things and they love contests.
Make the prize something desirable and related with the business. It could be a free gift basket
of Skin Tique product or something else. For exampleto participate, customers need to spend a
minimum price or purchasenew Skin Tique product.

8.0 CONCLUSION

As the conclusion, product packaging, product differentiation and customer preferences are the
crucial issues that should be taken into many markets. Keeping updating with the current

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customers’ trends and needs on products design gives many benefits to marketers. For
example, although Skin Tique shaving gel customers are seen to be loyal with shaving gel
offered by this company, there are tendency for them to switch to the competitors which offered
better products designed. Product cannibalization also tends to be happened if they decide to
introduce aerosol container. The way management tackle the problem determines the number
of market share captured by new product designed which aerosol packaging.