Options available:

 Introduction of new brand (4th one after the existing 3)

 Product improvement in the existing brands
 Increasing the marketing expenditure on the existing brands.

Analysis:

 Optn 1:
o New brand can be introduced in all 3 segments. Well positioned new brand was
expected to capture 60% of its share from competitors.
o Con: It requires $20mn as capital investment for production stuff. Also, it needs
$60mn for first-year introductory marketing expenses…. costly.
o In performance segment: H-80, new formula
o In Mildness segment: further differentiation, as most customers preferred milder to
hands more than any other benefit…. but the segment is in decline.
o In Price segment: No presence in the fragmented market. Profit margins falls from
32% to 14% as it is low price… reducing margins… can they?
o Time required: 2years, Plus a year in test market.
 Optn 2:
o Less investment than new brand intro. $20mn capital costs remain. But marketing
costs only $10mn as it is an existing brand (Dawn or joy… preferably dawn)
o Can use H-80 formula here as well!
o Joy also had “no spot” formula. It reduced COGS of joy by $3mn per year. No capital
investment required but relaunch would require $10mn marketing expense.
o Time required: 1year, worst case (test market) 2 years.
 Optn 3:
o Low growth potential in LDL category. Should he avoid any capital investments?
o Focus only on marketing to increase volume sales.
o Limited funds, Ivory requested $4mn additional funds to support extra advertising
and promotions.
o Time required: immediate approval possible, worst case (Test market needed) 6-
12mnths