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October 18, 2009

Ad-lider Packaging, SA:

Marketing Research for
Cord garbage bags in Brazil
Introduction
In July 2001, Lazlo Sved and his new partner, Emilio Figer, went once again to market research. The
two senior executives of Ad-leading Packaging Packaging, SA (Ad-lider Packaging, Inc.) were
carefully considering how the marketing research findings they had commissioned would affect the
launch of their new cord trash bag product line called Climp Fecha Facil (Easy Close). See Appendix
5 for a product photo. They sought information about consumer preferences, consumption habits,
and perceived competitive advantages that impacted prices, product size, and distribution decisions.
Having invested a million dollars for the new production machine, the two executives were eager to
"get it right" with regard to segmentation and positioning, and creating value for the consumer.

Lazlo was convinced that a successful release of Fecha Facil was of utmost importance. He
believed that the current Ad-lider product mix would not bring satisfactory profits in the long run.
He felt that Ad-lider needed to launch a new, different, modern product, and offered the market a
more favorable cost/benefit ratio than the products currently on the market.

Population and Economic Stabilization of Brazil

Brazil is one of the largest countries in the world, covering an area of 8.5 million square kilometers.
The country is divided into 24 states, two territories and a Federal District. The five regions of Brazil
and their respective population sizes are presented in Appendix 1. Of brazil's 170 million inhabitants,
almost 43% or 72 million live in the Southeast. The three largest metropolitan regions in Brazil are all
in the Southeast: São Paulo (20.2 million), Rio de Janeiro (12.15 million) and Belo Horizonte (5.3
million). 1st

In the mid-1990s, after a long period of high inflation and economic stagnation, the successful
Brazilian economic stabilization plan, known as plano real,restored the purchasing power of the low-
income segment of the population. This turnaround allowed many Brazilians to buy consumer goods
previously inaccessible to them. As a result, during the second half of the 1990s, numerous segments
of the economy, including various product categories, experienced fantastic sales growth.

Brazilians categorized in the Social Class C group were the most benefited by this economic
stabilization. The Brazilian Market Research Association, ABIPEME, has developed a social class
classification widely adopted by local researchers, marketers and advertising agencies. The scheme

1
http://www.worddiq.com/definition/List_of_metropolitan_areas_by_population.
 Copyright © Thunderbird 2004, The Garvin School of International Management. All rights reserved. This
case was prepared by Professor Rosane Gertner of Pace University; Teachers Dennis Guthery and Richard
Ettenson, Thunderbird, only for discussion purposes in the classroom, and not to indicate effective or
ineffective management.

combined income, education, and material goods to define five social classes —A, B, C, D, and E.
Class A and B members had the highest levels of income, education, and purchasing power, and
tended to be more sophisticated consumers. Classes D and E had no purchasing power and struggled
to pay for even the most basic goods and services. Class C consumers were described as typical
lower-middle class workers and constituted 12.6 million Brazilian households. The 30% of Brazilian
households classified as class C accounted for 28% of the total consumption in Brazil. On the other
hand, classes A and B represented 19% of Brazilian households and represented 52% of national
consumption. The lower classes D and E represented 51% of households, but represented only 20%
of national consumption.1

Another view of socioeconomic differences can be seen by examining income distribution. In

2000, the richest 10% of Brazilians received 47% of the national income. The next 40% received
39.5% of national income, while the lowest 50% of Brazilians received only 13.5%. 3rd

Ad-lider Embalagens, SA
Ad-Lider Embalagens, SA was founded in 1970. The company, based in the city of Tres Rios, Rio de
Janeiro, is one of the largest Brazilian manufacturers of plastic bags and packaging. A commercial
office is located in the city of Rio de Janeiro. The company controls Ad-lider Transportation, a
trucking company that distributes its products. The company sells directly to large accounts and uses
43 specialized distributors to cover other accounts throughout Brazil. Sales by region vary widely: the
Southeast accounts for 50% of sales, while the North and Northeast regions together account for an
additional 25%; The Midwest and the South account for 12% and 10%, respectively.

Total sales in 1998 were $21 million and were forecast for $25-27 million in 2001. The company
had three divisions: commercial products, industrial products and consumer products.

The commercial division, which accounted for 52% of the company's revenue in 1998, had two
primary lines, AD-ROLL and AD-SHOP. The AD-ROLL line consisted of plastic bags for
production and meat departments. The AD-SHOP line consisted of bags bought by retailers as
diverse as fashion boutiques and supermarkets for shoppers to take home shopping.

The consumer division sold three products to consumer and commercial companies. Limp-
OLixo, the main product, was a line of household garbage bags, sold in rolls, with individual bag
capacities of 15 to 100 liters. A second line, FREEZER, was sold to consumers to store food in
freezers. AD-LIDER BAGS (reinforced bags) have been sold to commercial companies such as
hospitals, restaurants and building maintenance companies.

The industrial division had three product lines: an automated packaging line for manufacturers
that packed products, such as beans and rice, in plastic bags for sale to consumers; packaging
materials for wrap pallets; and a line to package products to eliminate the need for cardboard boxes. 2

1 Gazeta Mercantil, February 2002

3
Ibid.
2 http://www.adlider.com.br.

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The market for household plastic garbage bags
In 1997, the Brazilian garbage bag market was estimated to move about 1.3 billion pieces and was
valued at US$ 120 million. 3 The product came in blue and black with capacity/sizes of 15, 20, 30, 50,
60 and 100 liters. The bags were packed as rolls or folded. The rolled bags came in a plastic bag, and
the folded bags were packed in plastic or cardboard boxes. Smaller bags for the kitchen and
bathrooms were also available.

There were three national brands of garbage bag rolls: Limp-o-Lixo, Dover Roll and Koleta.
The manufacturers of these brands were Ad-Lider, Fort-Roll and Colmag. These brands can be
found in all major supermarket chains in Brazil. In addition to national brands, there were regional
brands and many supermarkets carried their own brands of stores.

The three main national brands were sold directly to the largest supermarket chains.
Wholesalers and distributors were used to distribute the product to smaller supermarkets,
convenience stores and other small retailers such as meat markets and fruit stalls.

The big supermarkets were the most growing channel in retail. In relation to garbage bags, large
supermarket chains tend to work with a leading brand and no more than two other brands. Some
chains, such as Sendas, Bom Preco and Extra had their own private brands of garbage bags. In most
retail stores, garbage bags were located in the household cleaning products section. Typically, the
bags were on the bottom shelf and, given the fact that many were rolls packed in plastic bags, the
area was often in disarray.

Fort-Roll was the strongest competitor to Ad-lider. It was the manufacturer of Dover Roll, the
market leader and quality symbol for many consumers. According to the fort-roll website, Dover Roll
was targeted at class A and B consumers. The company also had products aimed at class C
consumers.4

Market Research - Focus Groups

In November 1999, Ad-lider commissioned Synergy, a respected market research firm, to conduct
focus groups related to the launch of the Climp Easy Close garbage bag. The focus groups were held
on November 24 and 25, 1999, in the cities of Rio de Janeiro and São Paulo. Three focus groups
were held, two in São Paulo and one in Rio de Janeiro. In São Paulo, one focus group consisted of
housewives who lived in apartments, and the other was housewives who lived in houses. In Rio, the
focus group consisted of housewives who lived in apartments.

The aim of the research was to evaluate the acceptance of the new Easy Close garbage bag,
learn about packaging preferences and determine how the easy closing feature (design chain) was
perceived by garbage bag buyers.

Participants were selected from social classes A and B. All participants were involved with
domestic responsibilities, including purchases in supermarkets for the family, and all plastic bags used
for garbage disposal.

The profile of São Paulo residents living in houses was married women, aged 28 to 40 years,
with children and a minimum of high school. Some women graduated from university and had a
professional career. The Paulistanos living in apartments had the following profile: married and single
women, aged between 28 and 39 years, most with a university degree. Most of the women in this
group were professionals with careers in areas such as clinical psychology, education, nutrition and

3 Datamark, Brazilian packaging industry, 1996.

4 http://www.Dover Roll.com.br.

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 small businesses. His family income was comparable to the other group from São Paulo. In both
groups in São Paulo, participants were removed from geographically dispersed regions of the city.

The participants from Rio de Janeiro were, in their first part, single and divorced women, aged
between 32 and 42 years, with or without children, and with complete high school. A minority were
professional women. Family income was comparable to são Paulo groups, and individuals were
removed from various areas of the city.

Lifestyle differences existed between the participants of Rio and São Paulo. The participants of
Rio worked in exercise programs, most of which belonged to a gym and/or regular participants of
sports or walkers. Almost none of the Paulistanos participated in exercise programs.

The Interview Guide for these focus groups is in Appendix 2.

Market Research - Individual Interviews in the Test Market

The Climp Fecha Facil garbage bag was placed in Sendas Supermarkets, in Rio de Janeiro, between
April and June 2001. Another consumer survey was conducted in May-June 2001 for:

• Determine the buyer's profile of the garbage bag (user) by gender

• Determine how often households purchase garbage bags
• Determining the relative market shares of the main brands
• Determine key drivers/concerns about buying garbage bags
• Determine how well the Climp Fecha Facil bag competed with the Dover Roll with a cable.

Purchase Intercept Interviews were conducted on seven consecutive Saturdays, from April to
June 1999. All interviews took place in 29 Sendas Supermarkets. A total of 528 interviews were
conducted, of which 495 were considered valid.

It is noted that during the time of these interviews, the Dover Roll brand was on sale for two
weeks. During the last week of the survey, the Limp-o-Lixo brand was for sale. The results of this
research are presented in Appendix 4.

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Appendix 1Brazilian population by region

Population % Region/Country
Region 2000 Census Population, 2000 Census
Southeast 72,297,351 42.6%
On 25,089,783 14.8%
North 12,893,561 7.6%
Northeast 47,975,416 28.2%
Mid-West 11,616,745 6.8%
Total 169,872,856 100.0%

Source: http://www.terravista.pt/Enseada/1347/mapado.htm, seen on June 1, 2004.

Appendix2Interview Guide for Garbage BagFocus Groups

1.HEATING (5 minutes)

• Introduction to the search process

• Presentation of the interviewed participants: name, age, profession, marital status
(married/non),children, etc.
• Presentation of the research theme: cleaning material

2.HABITS (10 minutes)

• The daily activities of the family

– What are the activities of each family member; what is their day-to-day agenda?
– What they like and don't like (take advantage or not) to do

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 • Domestic activities
– Do they depend on maids/contractors (monthly or daily rent)?
– Level of interest in the administration of the house
– Involvement in household chores, in what tasks, frequency and intensity – What are the household
chores that most and least like?

3.CLEANING MATERIAL/GARBAGE BAG (30 minutes)

• Presentation of the theme

"Now let's talk a little bit about cleaning materials, about grocery shopping and the use of
some of these products."
• Cleaning equipment/products that they use most; what contributes to these choices
• Who decides which cleaning products to buy, how often (weekly, twice a month, monthly), and where
do they buy?
• Behavior in relation to garbage storage/disposal- Do they buy garbage bags?
– Final use of plastic garbage bags (except for garbage disposal)
– How do they tend to store/dispose of household waste and what they use to store/dispose of the
many types of household waste: kitchen trash, office/library, bathroom, garden, maid's bathroom,
etc.?
– If a garbage bag is not used, what is used and why?
– If they've used garbage bags but don't use them anymore, why have they stopped using them and
what factors have encouraged them to go back to plastic garbage bags?
– If they use garbage bags, to what extent to what kind of garbage?
– What are the characteristics of garbage bags used in relation to thickness, color, size, brand, etc.?
• In relation to the purchase of the garbage bag
– Who decides and buys garbage bags, how often (weekly, twice a month, monthly), and where do
they buy?
– What are the decisive factors that define the purchase of plastic garbage bags; what do they value at
the time of purchase: brand (what), price, quality, packaging, thickness, etc.?
– Satisfaction with the garbage bags they currently use
• In relation to household waste
– Who is generally responsible for storing/disposing of each type of waste?
– What are the biggest problems noticed when using garbage bags?
– How long does the stored waste remain inside the house/apartment?
– Destination of the garbage: after storing the garbage, what is your destination (it goes to a set
place,waits for the garbage man, or is it collected by the apartment staff)?

4.TRASH AND YOUR ENVIRONMENT (10 MINUTES)

"Since we're talking about garbage, I'd like to hear from you all about garbage and your
environment."

• The group's perception of garbage and the environment/impact on the environment

• Regarding garbage recycling, do they know of any program and what is the group's position on this
topic (are they committed or not, do they believe in the success of the programs, etc.)?

5. MARKET/COMPETITION KNOWLEDGE (20 minutes)

• Perception of the various existing plastic bag products; how they see the products on supermarket
shelves (exhibition, visibility, attractiveness)
• What brands do they know?
– Images
– Features
– Strengths and weaknesses
– Closure

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– Size, thickness and color
– Preference
– Packing: economy and super saving
• Preferences
– What are the preferences?
– What is the relationship between price and quality?
– What are the similarities and differences between brands?

6. IDEAL PACKAGES (10 minutes)

• What is the ideal package; Expectations?

7. ANALYSIS OF THE PROPOSED NEW PRODUCT (30 minutes)

• Packing: show the carton packaging and plastic packaging, alternately, between the groups
– Reactions
– Understanding the product through packaging
– Perception/image sent
• Presentation of the new garbage bag
– Reactions
– Likes and dislikes
– List of packaging and product presented - What do they like and do not like the most?
– Benefits and advantages noted
– Use expectation and purpose
– Product perception in a kitchen: aesthetics, functionality and hygiene
• Once again, presentation of the product in box and plastic packaging
– Preference between them
– Strengths and weaknesses of each
– Transmitted image
– Roll vs. folded
• Economy and packaging of super
economy - Knowledge - know what it is?
– Do they buy it or not?
– Optimal quantity of garbage bags per pack
• Price
– Compare the packages present in the market — price relationship between them; How's the price?
Would they pay more for the new scholarship? How much?
– Present quantities of plastic bags in super economical packaging of 30L (50 units), 50L (50 units)
and 100L (25 units): are you willing to pay more for the packaging and less for the
packaging/relationship (single and total price)?

8. COLOR (5 minutes)

• Display the colors and preferences of questions and why

9.PRESENTATION OF THE REMAINING PRODUCT LINE (10 Minutes)

Depending on the arrangement or progress of the group, the other plastic garbage bags will be
presented to them to quickly check:

• Reactions
• Utilities
• Likes and dislikes

10. END OF SESSION AND THANK YOU

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 Appendix 3 Analysis of Garbage Bag Focal Groups

Introduction

The qualitative research was carried out on November 24 and 25, 1999, in the cities of São Paulo and
Rio de Janeiro. The objective of this research was to evaluate the acceptance of the new garbage bag "Fecha
Facil", and to know the packaging preferences and perceptions of housewives in relation to the closing system
of the new product.

In São Paulo, the research base consisted of two groups — one of housewives and one of wives of an
apartment, and in Rio, a group of apartment wives. The groups were composed of housewives (and apartment
wives) of classes A and B, who were involved in domestic activities and responsible for supermarket purchases
and the use of plastic garbage bags.

THE DAY-TO-DAY ACTIVITIES OF HOUSEWIVES

The similarities were found in the daily lives of the women interviewed. Their days were hurried, women
were very involved with the administration of the household, with the education/schooling of the children,
with the purchases, and, in addition, some of them had long commutes in their professional activities.

Most of the interviewees had some kind of help for domestic activities, either two to three times a week
or maids who worked six days a week. In the houses where the maid did not work daily, the housewives
performed some of the daily routines, such as cooking, cleaning the house and washing clothes. Housewives
liked to cook, but they didn't like cleaning and ironing. Of course none of them found gratification with their
domestic duties. Often these needs were imposed on them.

Interestingly, the housewives of Rio de Janeiro took care of themselves physically, were members of a
gym, played sports and walked. In São Paulo, with the rare exception, this daily routine was not part of the lives
of the interviewed housewives.

In São Paulo, housewives were more demanding with their maids and with regard to the house: "The
girl who works at home is good, but she [doesn't] [do the job] exactly the way I like it... so what I think is out of
place or not was done right to my taste, especially in the cleaning part, I go and do it" (resident of casa, São
Paulo).

In relation to monthly purchases of cleaning materials, most of the time, these were purchased by
housewives. In São Paulo, it was very rare when a husband was involved in this process. It was also noticed that
younger couples in São Paulo were getting involved together in grocery shopping.

In Rio, the husband or boyfriend was more involved in deciding which product would be purchased
than in actual purchases. However, some men did the shopping and even decided what to buy. "I am very
attentive because we have a large family. I know the right amount that needs to be bought and what's needed. I
practically play all the decisions, but my husband loves the supermarket" (apartment dweller, Rio). "My
boyfriend loves the supermarket. He gives me tips, he keeps talking and I keep buying" (apartment, Rio).

It can be noted that some housewives were loyal to some brands, such as Bom Bril (steel wool), Omo
(laundry detergent) and Sadia (chicken, noodles).

Women were more rational with shopping, while men were more curious—they liked to experiment
without taking into account the price. "The supermarket part is just me... he helps, it's up to me, he likes to try
more. He buys, I control" (apartment, SP).

Important factors in the decision to purchase cleaning material

Especially for the women interviewed who live in houses in São Paulo, practicality was the most
important factor in the decision to purchase disposable and cleaning materials. They also admitted that
advertising influenced them in the purchase.

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 Price, practicality and quality are fundamental attributes for housewives and understand quality as "what
works"; "that is good and efficient"; "this is the product that does what it really promises."

GARBAGE MAINTENANCE/STORAGE

In general, household waste storage was done with plastic garbage bags (of varying sizes, in blue or
black), in addition to using plastic bags from supermarket (this was done especially in apartments).

Behavioral differences of those living in apartments versus those living in homes related to garbage storage

1. Apartments

Regarding garbage storage, there was a notable difference between the residents of the apartments in
São Paulo and those in Rio de Janeiro. The difference was basically in the color of the plastic bags that
housewives used.

In São Paulo, there was predominant use of black color, as it was perceived as more durable than blue
bags. In Rio de Janeiro, black color was not present/available in the national market and, therefore, the blue
color was associated with garbage bags. When the black garbage bag was used, it went to large amounts of
garbage (100 L bags) for professional use or by the demand of the condominium.

However, in both cities, plastic grocery bags were also used for small garbage such as bathroom and
kitchen waste. It is noteworthy that the use of the plastic bag of the supermarket was higher in São Paulo than
in Rio.

The issue of cost, especially in São Paulo, was clearly not noticed as a factor for the use of plastic bags in
the supermarket, but the final purpose of the bag was clear: it was used to be thrown away. " The priority in my
house is the small plastic bags. What am I going to do with them? Throw [them] away? When I'm done, I have
the garbage bags" (apartment, SP).

In Rio, the use of the supermarket's plastic bag was more associated with the ease of closure due to its
handles. "The garbage bag needed to have an accurate measurement of space so I could tie it. [Garbage bag
manufacturers] haven't had that idea yet. Why do we love the plastic bag at the supermarket? Because you have
ears. We love it" (apartment, Rio).

Brands and Capacities of Garbage Bags Used by Apartment Residents

Sao Paulo, St. Paul

Brand: Interestingly there was no recognition of a brand in São Paulo. Only the Sacolimp brand was
remembered, with much uncertainty and resistance, by only one interviewee. Another interviewee mentioned a
certain garbage bag "with small handles."

Capacity: In relation to sizes, there were 20L, 30L, 40L, 50L, 60L and 100L. "I use the 30L and 50L bags
for bottles and kitchen waste. In the bathroom, I use a grocery bag. Now I look at the price" (apartment, SP).

Rio de Janeiro, Brazil

Brand: In Rio, the Dover Roll brand was quickly mentioned and remembered by almost all respondents.
At first, an interviewee said, "I use the 30L, small roll, and small handle", when she was quickly interrupted by
another interviewee introducing the name Dover to the group, which was the brand most purchased by the
participants.

Capacity: It was also noted that there was a certain uniformity of use in relation to the capacities: 15L,
30L and 50L. "I always use the Dover Roll. I use the 50L for the kitchen and the 15L for the bathroom. Of all
the ones I used, it's the one that tears the least" (apartment, Rio).

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 Sanito was another brand mentioned in Rio, preferred by only one participant. "I use blue (Sanito)... [it]
is tougher, and stronger than the others, it doesn't tear so easily. Sanito is a little darker, and I prefer the bag; I
think I got used to it"" (apartment, Rio).
The importance of a strong garbage bag was made clear in São Paulo as in Rio. In Rio, where the Dover
brand was the best known, when encouraged to relate its strengths and weaknesses, they said:

• It's practical.
• Toilet
• There's a thing to tie.
• "Dover Roll... already comes curled up, it's the only one.

On the other hand, the handle (as a closing system) and the roller, previously cited as strengths, were
factors that displeased the housewives. "When it's time to close the bag it's horrible. It has this handle, it's
horrible when you tie a stronger knot [and] it breaks. The handle should be stronger" (apartment, Rio). "When
it's time to take off the roll, if you're in a hurry, it doesn't cut, it rips" (Apartment Rio).

When the Carioca group was asked what differentiated Dover from the other bags, the answers were
color and handle. They noticed that the color Dover blue was more milky and resistant (strong).

Definition/purchase decision

When groups of apartment dwellers from both São Paulo and Rio de Janeiro shopped, the purchase
decision in São Paulo was more price conscious. Therefore, the issue of strength became secondary (they
wanted price with quality).

In Rio, the price was not much mentioned, since the choices were basically defined by the habits of
using certain brands. For example, Dover was perceived as the bag closest to the needs of housewives: it was
not transparent, sturdy, and had a closing system (however inefficient it was).

2. Houses–Sao Paulo

As garbage collection was not carried out daily, sometimes the large black bags of 100L were used.
Rarely were 100L bags bought at the supermarket. According to the group interviewed, garbage bags purchased
at the supermarket were perceived as of poor quality. "I used to buy black bags at the supermarket, but because
of [their] poor quality, I started buying them [them] in the warehouses. Black bags are cheaper, their quality is
better" (casa, SP). "The garbage man comes three times a week, so I use these black 100L bags; for the house, I
use the small plastic bags" (home, SP).

Regarding the brand of the black purse, there was no specific preference. The housewives believed that
there was no specific brand of better quality, and that they only came with a guarantee from the manufacturer.
"I buy from a supplier. I'm tired of changing brands, now I only buy them" (casa, SP).

The black 100L bags served as a dump for the other house's trash that was usually bagged in the blue
garbage bags. However, it was clear that if there was a smaller black bag on the market, "I would wear all
black." Black color was associated with good quality. "Black is good! The thickness of the black is better, you
can not see the garbage, [the black bag] is more resistant" (home, SP).

Garbage bags used inside the house, such as kitchen and bathroom bags, are used in the same way in
apartments. The blue bags of 20L and 30L were used as grocery bags — for the kitchen sink (to a lesser extent
compared to the apartments). However, in Rio, it was a little different; there was greater use of black bags of
lower capacity (60L) sold in mass goods or by sellers.

Regarding the blue bags, they reported: "the blue is horrible, and not even that little thing is strong, the
supermarket bag is much better". When they asked "What little thing?" they replied, "the little handle/handle
you have for us to tie it." "Honestly, the blue garbage bags, in my opinion, I'm not even going to buy" (casa,
SP). The question of price has barely been brought up. Strength was the main factor for the housewives
interviewed.

10 TB0141
 Another issue mentioned by the group, in relation to black 100L bags, was the difficulty in closing it due
to its thickness. "The only drawback is that it is difficult to close it. I even bought rubber bands for him"
(home, SP).

One of the interviewees mentioned having bought a garbage bag different from all the others, and how
she liked it and hoped to meet it again at the supermarket. When its characteristics were explained, the other
participants in the group quickly asked for the brand and the place where they could buy it. (Housewives
received referrals from third parties.) "The bag has a border as if it were folded, it's green, and I pull the sides
and close. There's no need to tie your mouth.

Brand recognition

When asking the interviewees the marks of the garbage bags, it was with great difficulty that they
mentioned Pro-Trash, So-Lixo, Pra-casa, Nips and So-Limpo.

Difficulties with garbage storage

The task of storing garbage was recognized as not easy by the interviewees. When they lived in houses,
there was a need to have to deal with large 100L bags, which were usually black and difficult to close.

When they lived in apartments, and usually black bags were not used, they handled blue bags, which in
their opinion were weak and torn easily. They scoffed, "When we need to move the trash, that woman doesn't
wonder if the bag will leak or tear!" (apartment, RJ). This was a question dealt with daily, not day, or two or
three days, depending on whether routine garbage removal occurred in a house or an apartment.

PURCHASE OF GARBAGE BAGS

When the housewives went shopping, they experienced the lack of package images, along with clutter on
the shelves and aisles of supermarkets. It was a unanimous perception. "They (the garbage bags) are well
hidden, usually completely disorganized and mixed. They are usually on the bottom shelf with cleaning
products, and the blue bag always stands out (SP and RJ). I think that's why no one remembers the brands"
(apartment, SP).

Regarding the exhibition of garbage products in the supermarket, the housewives had a suggestion to
facilitate the decision process at the time of purchase: "We look and have no idea of the size. The supermarket
should display the sizes of the bags."

1. Market Knowledge

Brands

There were numerous brands of bags in the markets, but were the brands known to housewives? Did
they buy it for the brand?

In Rio, housewives were more attuned to the garbage bag market than to buyers in São Paulo. Quickly
and without hesitation, some participants of the group identified the Dover Roll brand, followed by Sanito and
Lixito. The similarities of these bags are that they are all blue; the differences are in texture, or in other words,
in resilience.

The interviewees were asked to associate specific words with the marks, and answered:

• Lixito was associated with the word fragile;

• Rolo do have to work; And
• Sanite for cleaning.

The housewives of São Paulo, initially a little shy and quiet, ended up quoting Saco Limpo, Pro Limpo
and Pro Lixo. They were not able to clearly define the similarities, differences or even preferences between
brands. "I prefer the one with the little man's drawing." "There are many confusing packages, because there is
usually only printing on the front."

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 The housewives in Rio selected, without much conviction, Modeplast, So Lixo, Pralixo and Vulcao, but
could not distinguish between them. Some distinguished the products by packaging: "If it is a good package, it
catches the eye"
For the housewives of São Paulo, there was no difference or similarity with the blue markings; were
generally considered the same and of equally poor quality.

Packaging

Despite the preference of packaging in laminated bags, the housewives of São Paulo are not big buyers
of them, mainly because, in the market, the black bag (which was most used), came folded, not in rolls.

Regarding the packages, no comments were made on the terms "economy" or "super economy" garbage
bags in Rio de Janeiro or São Paulo. When asked, the participants did not seem to know even a supplier, or the
importance of such packaging. When even more stimulated, the answer was:
"It's the one that comes with more and you pay less."
"It's the size of the bag."
"That means I'm not going to use as many bags for the amount of garbage I have —I'm going to use
less."

It was confirmed that these terms were not part of the daily lexicon of housewives.

2. Important aspects for purchase

For all interviewees, resilience was a fundamental factor in the choice of garbage bags. "When deciding,
we know if the bag is of good quality and [strong], by its weight." This attribute was more valued by the people
of Rio de Janeiro, since in São Paulo, the force was identified with black bags.

In Rio, where blue bags were basically the norm, the differential was based mainly on the issue of
strength. According to the group, there were more resistant blue bags and others that were not.

Resilience was necessary for housewives from São Paulo who lived in houses, but this factor was not
verbalized as the first factor responsible for the purchase. By the time they decided to use black bags, it had
already been determined that resilience was important because they knew that the black bag was synonymous
with it. According to them, the price was chosen as the decisive factor of the purchase.

For all the housewives living in apartments in São Paulo, a garbage bag with ideal capacity/size was the
main factor in their purchase decision, although the issue of resilience, once again, affected their purchasing
decision, along with the price: "I see capacity first. It's not worth buying if it's not the right size."

In conclusion, resilience, garbage bag size and price were important factors in choosing a garbage bag.
The closing aspect of the bag was important; however, the participants did not mention it as the main factor.
Of course, an efficient closing system would have helped the housewife considerably.

Whether it was transparent or not, in addition to being connected with the resilience of the garbage bag,
color was also associated with privacy. A housewife from São Paulo was decisive in drawing attention to color
as an important factor in the choice of garbage bags: "A clean garbage bag is like transparent clothes — it takes
away privacy" (apartment, SP).

THE NEW GARBAGE BAG

As previously caught the eye, there was no garbage bag that completely satisfied the demands and needs
of housewives. But what would be the ideal garbage bag? What would be your specifications?

1. The ideal garbage bag

Basically, the ideal garbage bag would need to be "something easy to close, resilient, with a different
color from the others."

12 TB0141
 In São Paulo, in both groups, an efficient closing system was expected. The words "deal to close" have
been used many times. With the house group, this was an even more relevant attribute; after all, closing a
strong black 100L garbage bag is not an easy task, as mentioned. Resilience followed closely in importance after
the closing feature, which was followed by color/opacity.
In Rio, color and resilience came before the closing attribute. It was mentioned that Dover had the best
method of closure. Another color for the bag would have been ideal (mentioned by the group), as a way to
differentiate the bag from the others. But they wanted "a quality product with a low price."

In conclusion, the ideal bag needed to have a closing system, be sturdy, opaque and not very clear.

2. Packing appearance (plastic and carton)

Soon after the participants defined the ideal garbage bag, a package was displayed in order to understand
the product through this package.

In all three groups, without exception, the reaction was pleasant surprise and gratitude for having
designed a bag similar to the ideal. They exclaimed, "That [is] him, look at the garbage bag! Very interesting,
you pull, [it] closes, and you tie" (São Paulo and Rio, apartments). "They made a product exactly the way we
were talking" (referring to the ideal bag, RJ apartments). "If it were on the shelves I would pick up" (casa, SP).
"The bag is elegant, large, and the closure is great" (casa, SP).

It was observed that the participants defined, through the packaging, the closing system with a handle
and how to load the bag when filled. However, generally, they focused on the color of the bag, the texture, size
and quantity of the bags inside the package. In other words, they insisted on analyzing the package, not by the
concept of the scholarship, but by the information described in it. And they always made the move of closing
with their hands, showing how to close it. The cord was the great differential of the product.

Interestingly, in São Paulo, the first reference was made to Easy Close (Fecha Facil), in front of Rio,
where the first reference was to the brand name, Climp. "You can close with the handles and carry it by the
handle" (home, SP). "I thought it was [very] small for the outside and [very] big for the interior of the house. If
there were other sizes I would buy" (house, SP).

Packing preferences: carton or plastic

The plastic packaging was shown to the group of houses in São Paulo and to the group of apartments in
Rio. The packaging of the box was shown only for the group of apartments in São Paulo.

Sao Paulo, St. Paul

Interestingly, in São Paulo, with both groups, there was a division in preference in relation to carton
packaging and plastic packaging. Those who chose the box noticed it as more practical and beautiful. " Plastic
packaging doesn't work. The bag comes curled inside; to take it off, you need to take out the whole roll, pull
and store the whole roll again" (flat, SP). "The box is different, it is more [common] in the supermarket, it is a
differential, it is easier to take the bags" (apartment, SP).

Those who chose plastic packaging also described it as practical, but what determined their preference
was the perception of the box "as being more expensive". Those who preferred plastic argued that the
important thing was the ability to see the product.

When showing the packaging - plastic and box - at the same price, there was a slight tendency to favor
the box, especially with the group of apartments.

The residents interviewed of the houses did not perceive the cord bag as suitable for large capacities.
Almost always, they referred to the new bags simply for the use of small amounts of garbage.

Rio de Janeiro, Brazil

The cariocas (native residents of Rio) did not accept the box, saying it was "more expensive, could
wrinkle and get back." "The box is a love, but for everyday life, the other is better. The box is very chic"

TB0141 13
 (apartments, RJ). Rio respondents were more accustomed to using garbage bags that came on a roll, such as
Dover, and rejected any change with the packaging.
Packaging elements

Two box packs (green and blue) with different design elements were displayed. Preferences for color,
design, attractiveness, exposure and clarity were studied.

The residents of the apartments of both São Paulo and Rio de Janeiro responded similarly to the
different changes suggested, although there was no consensus. Some preferred the blue box; others, the green
box. However, it was noted that there was a tendency to mix the boxes, for example, drawing one like the
other, and mixing the colors from one to the other. But there was a consensus with the size of 50L, which was
more clearly identified as "appearing to have] 50 bags of quantity". The Easy Close in the blue package was
considered more attractive. Some suggestions of the interviewees were:

• "I would put all [amount of] garbage [that] can fit inside [the outside]"
• "I would put the capacity inside the trash [bag]"
• "Put that the bag has a larger capacity, because it closes from above, then you use more bag."

As for the group of the house, a certain confusion of preferences was noticed. There was no trend; they
mixed both packages in an antagonistic manner from the other two groups. It was not the new amenities that
prevailed; they mixed the colors. They preferred the same design, but had mixed preferences in colors: "It's
blue in green design." "It's green in blue design." The agreement was found with the attention of Fecha Facil as
in the other two groups: "Fecha Facil is what will make you want to know what it is".

3. The Presentation of the Climp Garbage Bag Closes Easily

After the analysis of the packages, garbage bags were distributed with the Fecha Facil system. The
objective was to evaluate whether the product presented had been well described in the packaging.

The members of the group seemed to be curious, and when the bags were distributed, the first reaction
was to test the handles. As the bags were empty, some of the reactions were negative/contrary: "I had the
impression that when you pull, they join alone" (apartment, SP). But in both groups of apartments, there was
one participant who explained how the handles worked and their efficiency when the bag was full of garbage,
which was automatically accepted by the other participants.

Again, color was very much related to resilience. When darker bags with handles were shown, they
associated them with a better texture, and when they tried the clean bag, the first reaction was "weak bag".

When motivated to analyze the other aspects of the bags, the apartment groups automatically favored
side stitching.

The group of the house of São Paulo reacted well to the new product, "it is practical", "seems to be
hygienic", but did not associate its use outside the home, that is, with the size of 100L. They would only use the
50L bags with the System Closes Easy.

The Perception of Resilience Prevails

"[He] is not [resistant]; if only it had the thickness of black!!! What if it's full? Will the handles manage?
(house, SP).

"The package gives the impression [that] the bag [is] better, from the packaging that [it] enters, we have
the idea that [it] is very [resistant], and that's not how it feels" (the bag presented—home, São Paulo).

For the participants of the house, closing the sturdy 100L black bag was difficult if it was full of garbage,
as already mentioned. Therefore, they can be expected to appreciate the closing system if the bag were
perceived as resistant. They were tired of picking garbage bags and were loyal to their door-to-door supplier.
They must be sure of their strength. They saw the new bags as hygienic and practical, even "beautiful", but

14 TB0141
bought them only if they were dark and resistant, since the ones presented were clear and transparent. "Bags
with darker colors, I wouldn't think twice, but I couldn't [they] be adopted in my house."
The participants' questions were constant. They wanted to know the price, the size/capacity of the bags,
the color. "If it has an affordable price, it would be wonderful, it will be the most purchased stock market"
(apartment, Rio). "Regardless of the price, I would buy, I [would] like to try [it]" (apartment, SP).

4. Advantages of the New Garbage Bag

Asked what advantages or benefits were noticed in the new garbage bags when compared to those
already on the market, they quickly replied, "the closing of the bag". "To close the trash and not let it leak... and
be able to carry it. "[The garbage bag} is not Bom Bril (steel wool pad), but has 1001 utilities."

Participants were willing to buy the bag because of the cord closure feature; however, for most, the
actual purchase was related to price: "I would certainly buy, depending on the price" "If the price is higher, I
will not buy."

The garbage bags with easy closes offered other uses mentioned by the participants, such as the storage
of sheets, shoes, dirty clothes, towels, books or clothes that they no longer use. And better yet, "you can be
hanged."

5. The Price

It is clear that there were different price perceptions between São Paulo and Rio. This difference
basically existed in the groupings of garbage bags on the market, i.e.:

• In Rio, the existing plastic garbage bags were divided into two groups:
– Most of the plastic bags on the market were simple and weak
– Dover Roll were more milky, thicker, and had a closing system ('wings/ears')
• In São Paulo, there was no differentiation. Blue bags were perceived as "all weak" and "with weak
handles". Housewives didn't believe the handle could be a differential. The groups are:
– The blue bags
– The black bags

Sorting them in the above order, the following price variety was found:

Sao Paulo, St. Paul

The price of a new garbage bag should not differ much from the blue bags, or be much more:
• Residents of homes in apartments would pay the same as for Dover, even if they had a different
closure system.
• The housewives admitted to being willing to pay a little more than for Dover.

Rio de Janeiro, Brazil

The price comparison was with Dover, the scholarship recognized by the group as the best quality. They
admitted the willingness to pay a certain amount/premium on Dover.

Anyway, participants from both groups believed that the scholarships were too expensive, especially the
blue ones, since they were not considered as a value of what they paid for them. Regarding the black bags, there
was not much complaint about their price. However, there was a declared preference for a green color, as it was
perceived as "prettier" and "different" and "easier to find on the shelf".

With regard to color vs. resilience, darker colors were declared as better, since the darker bags seemed to
be more resistant. This perception was even greater in São Paulo. In Rio, there was no distinction; both colors
could be sturdy.

TB0141 15
 OTHER BAGS

Even showing the Tie Tie (bags with ties — plastic or "twist-ums") and handle tie (bags like plastic bags
with "handles"), the preference was still the "bag with handle" (cord).
For tie tie, some respondents believed that the bag was tougher under the weight of garbage and that it
would be cheaper. As for the others, they believed that the method was more complicated due to the number
of edges.

For handle tie, the perception was the same as tie tie: there were those who liked and those who did not.
They believed it would be cheaper than the cord.

16 TB0141
Appendix4 Interviews ofthe Purchasing Intercept

1.Consumer Data

Purchases by sex:
• Women - 71.72%
• Men - 28.28%

During the study, it was found that 8.57% of the men who bought garbage bags bought the ones
their wives had ordered, so a more accurate proportion was:
• Women - 74.14%
• Men - 25.86%

2. Market Data: Purchasing

The percentage of garbage bags in rolls, with and without handles, was calculated:
• Garbage bags in rolls - 81.21%
• Waste bags with handles in rolls - 18.79%

The participation of the brand of garbage bags in the rolls was calculated:
• Limp-o-Lixo* - 48.12%
• Rolo do Dover – 19,05%
• Koleta** – 18,30%
• Paths - 14.53%

*All Limp-o-Lixo were considered in this line: supereconomy and multipurpose

**All Koletas were considered in this line: supereconomy, sink/ bathroom, condominium and black.

Garbage bags with roller handles:

• Climp Easy Date – 88,17%
• Dover roller with handle - 11.83%

Brand Share of major brands:

• Limp-o-Lixo - 38.79%
• Rolo de Dover - 15.35%
• Climp – 16,57%
• Koleta – 14,75%
• Paths - 12.32%
• Verwith handle roll - 2.22%

The table below shows the preference of the brand, according to the gender of the consumer:
Sex Climp Rolo de Dover roller with Koleta Limp-o-Lixo Paths
Dover handle
Female 18.31 17.18% 2.25% 14.08 39.44% 8.74
% % %
Male 12.14 10.71% 2.14% 16.44 37.14% 21.43
% % %
Market Share byManufacturer:
• Ad-Lider Embalagens, SA - 55.35%
• Fort-Roll Ind. Com. Exp. Ltda. - 29,90%
• Colmag Dist. Com. E Ind. Ltda. – 14.75%

Sales by Bag Capacity

Only the bags of 15, 30, 50 and 100 liters were analyzed; other types, such as bath bags and sinks,
were not considered:
• 15 Litres – 8.68%

TB0141 17
 • 30 Liters – 22.49%
• 50 Liters – 35.31%
• 100 Liters – 33.52%
The following table shows the percentage relative to the sale of each brand by size.

Size/Product Climp Dover Roll DR w/handle Koleta Limp-o-Lixo Sendas Total

15 Liter 20.45% 11.37% 11.37% 34.09% 22.72% 100% 30 Liter 16,,67% 13.16% 1.75% 11.40%
35.09% 21.93% 100% 50 Liter 17 32% 27.19% 1.68% 14.52% 34.64% 10.05% 100% 100% 1 15.88%
10.59% 3.53% 14.12% 50.00% 5.88% 100%

This table shows the percentage of sales for each brand relative to size.

Size/Product Climp Dover Roll DR w/handle Koleta Limp-o-Lixo Sendas

15 Liters 10.46% 6.49% 7.35% 7.43% 15.87%
30 Liter 22.09% 19.48% 18.18% 19.12% 19.80% 39.68% 50 Liter 36.05% 50.65% 27.27%
38.24% 30.69% 28.58% 100 Liter 31.40% 23.38% 54.55% 35.29% 42.08% 15.87%
Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%

Periodic purchases:
The following is an analysis of periodic purchases. In case of different period, it was considered the
closest.
• Weekly – 2.12%
• Every 15 days (twice a month) - 22.08%
• Monthly - 71.76%
• Every two months - 4.03%

The following table shows the percentage of total bags purchased, relative to the brand, for each period.
Period/Product Climp Dover Roll DR w/handle Koleta Limp-o-Lixo Paths To
tal
Weekly 10.00% 0.00% 10.00% 20.00% 20.00% 40.00 100
% %
Twice a month 20.19% 5.77% 0.96% 6.73% 56.73% 9.62 100
% %
Monthly 16.57% 18.93% 2.66% 15.09% 34.62% 12.13 100
% %
Every 2 months 5.26% 21.05% 0.00% 36.85% 31.58% 5.26 100
% %
Note: The weekly purchase was made by men 66.67% of the time.

In this table, the percentage is shown by sales period for each brand.

Period/Product Climp Dover Roll DR w/handle Koleta Limp-o-Lixo Paths

Weekly 1.27% 9.09% 2.99% 1.09% 7.14
%
Twice a month 26.58% 8.11% 9.09% 10.45% 32.07% 17.86
%
Monthly 70.88% 86.49% 81.82% 76.12% 63.58% 73.21
%
Every 2 months 1.27% 5.40% 10.45% 3.26% 1.79
%
Total 100.00% 100.00% 100.00% 100.00% 100.00% 100.00
%
From the data collected, it was also possible to find an average period for the repetition of the purchase
of each brand, better displayed below:

Average Time between Purchases

18 TB0141
• Climp - 26.01 days
• Limp-o-Lixo - 25.92 days
• Rolo de Dover c/handle – 26,55 dias
• Trails - 26.21 days
• Rolo de Dover – 30.41 dias
• Koleta - 30.88 days
Buying motivator
Reason/Product Gener Clim Rolo de DR Koleta Limp-o- Path
al p Dover c/handle Lixo s
Brand 27.68 8.54% 55.26% 45.45% 31.51 30.73% 1.64
% % %
Price 15.15 1.22% 18.18% 10.96 4.69% 90.16
% % %
Cost of Benefit 13.94 4.88% 3.95% 9.59 28.65%
% %
Quality 12.93 17.07% 25.00% 18.18% 6.85 11.46% 3.28
% % %
Practicality 10.71 59.76% 1.32% 18.18% 0.52%
%
Force 5.66 2.44% 26.03 3.65%
% %
No opinions 5.05 4.88% 5.26% 8.22 5.73%
% %
Promotion 4.44 3.95% 9.90%
%
Buy by order 2.42 5.26% 1.37 3.65%
% %
No mark set 0.61 1.37 1.04%
% %
Pia 0.61 4.11
% %
Color 0.20 1.22% 1.64
% %
Don't put too much weight 0.20 1.64
on % %
First purchase 0.20 1.64
% %
Garbage bag is not so important 1.64
0.20% %
100.00% 100.00% 100.00% 100.00% 100.00 100.00% 100.00
% %

TB0141 19
 Appendix 5

20 TB0141
Reproduced with permission of the copyright owner. Subsequent reproduction
prohibited without permission.