Case: Consumer reactions after launch of Velvet shampoo

Our Client is a manufacturer and marketer of Personal Care products. It has two established
soap brands in the market. Very recently, it has launched a shampoo brand – Velvet, which is for
the ‘Mid-priced’ segment of the market. The shampoo has been launched for rural and less than
1lakh population towns across 5 states of India – Maharashtra, Gujarat, Tamil Nadu, Karnataka
and Haryana. The company plans to launch Velvet shampoo in the other states of India, in the
next few months. The ‘Mid-priced’ segment of shampoos, across rural and less than 1lakh
population towns in India, constitutes 33% of the market at a national level.

The brand Velvet has been launched in the following SKUs – 100ml bottles, 50ml bottles, 8ml
sachets, 5ml sachets. However, in the initial months of the launch, all SKUs may not be
available across all the 5 states where it has been launched.

High GRPs were spent on the advertising campaign of Velvet, for which a TV ad was made.
During the month of Velvet launch, 50% of the ad spends were in national TV channels (DD +
other national C&S channels like Sony, Zee, etc). Rest of the 50% of the ad spends were in
regional TV channels with an equal split of 10% each in the states of brand launch – Maharashtra,
Gujarat, Tamil Nadu, Karnataka and Haryana. In addition to this, some advertising in
newspapers, magazines and outdoor media were also done in each state.

After a month of Velvet’s launch our Client has received internal Sales figures (not ‘Consumer
Off-take’!) and a subjective feedback from users of the shampoo through the Sales force. The
feedback has been positive from some of the states. At this stage, the Client has commissioned
/ subscribed to two market researches:
1. Subscription of ACNielsen’s Retail Sales Audit (A Syndicated product) figures for
Shampoos in mid-priced segment. This will give the distribution figures and estimated
consumer sales off-take data for Velvet vs competition.
2. A customized research among consumers of entire Shampoo market with special
emphasis on the ‘mid-priced’ segment.

The first data point of ACNielsen’s Retail Audit will be available 3 months after Velvet launch.
However, the data will only be ‘indicative’ as the coverage of the Client’s launched geographies
does not match with ACNielsen’s coverage. Thus, the results of the customized research are
going to be of utmost importance for taking immediate decisions regarding changes in the
marketing mix of Velvet.

For the customized research, a reputed market research agency was been approached to
conduct a brand health research. The study was being conducted in 3 important states –
Maharashtra, Tamil Nadu and Haryana – across a wide coverage of rural and less than 1lakh
towns. In each state, a sample size of 800 was covered and of this, at least 250 was from ‘mid-
priced’ segment Shampoo users. The important metrics to be covered (for Velvet vs
competition) in this research were:
a) Brand Awareness (Top of Mind, Other Spontaneous and Aided)
b) Trial
c) Repeat purchase
d) MOUB (Most Often Used Brand), i.e. Regular Usage
e) Intention to try in future (among aware non-triers)
f) Intention to repeat buy (among triers)
g) Brand imagery and Product perception (on several parameters)
The fieldwork of the customized research was started at (D+45), D being the launch date of the
shampoo brand, Velvet. The Client has asked for a ‘Top-line Finding’, to draw initial conclusions
on the performance of Velvet, on the following four metrics – Awareness, Trial, Repeat
Purchase and MOUB.

The following table shows the scores of Velvet on the above four metrics:

BRAND HEALTH – VELVET

Tamil Nadu Haryana Maharashtra

Base: Mid-priced segment of shampoo 413 252 270

users
% % %
Awareness 24 78 40
Trial 9 11 12
Repeat 1.8 2.2 4.5
Most often used brand (MOUB) 0.4 0.5 2.2

Based on this, you have to answer the following questions of the Client:

Q1. Haryana has very high awareness levels, but the scores on usage related parameters are not
that good. What could be the possible reasons for this? Give at least 4 reasons.

Q2. What has mainly gone wrong for Velvet in Tamil Nadu? Why?

Q3. After seeing this data, what actions will you take in Maharashtra? Why do you say so?