Dermavescent
Dermavescent Laboratories, Inc.
Dermavescent Laboratories, Inc.
I. Summary of Facts
A) Market – Dermavescent Laboratories, Inc. manufactures women’s personal-care products
1) Two primary markets
a) Drug stores
b) Food & Drug stores
c) Sold through rack jobbers who receive a margin of 20% off the sales price to retailers
2) Dermavescent Laboratories, Inc.
a) Sales of $258 million in 2005
b) Sales for Soft & Silky Shaving Gel were $3,724,000 at 1,960,000 units in 2005
c) Downward trend with a 0.32% decrease if no new packaging is introduced
3) Competition
a) Oligopoly – As of 2005, several competing brands existed in the women’s shaving cream or gel category.
B) Products
1) Women’s personal-care products
a) Soft & Silky Shaving Gel introduced in 1991
b) Other women’s products such as facial creams, hand body lotion, and a full line of women’s toiletries sold under different brand names.
2) Benefits
a) High-quality women’s shaving gel
b) Added moisturizer, lanolin and vitamin E to help moisten, reduce irritation, and make shaving easier
3) Product life cycle
a) Maturity/Decline – unit sales volume for Soft & Silky Shaving Gel have slowed and then plateaued.
C) Price
1) Premium priced at $3.95 per 5 ½ ounce tube
2) Retailers receive a 40% margin on the suggested retail selling price
3) Rack jobbers receive a margin of 20% off the sales price to retailers
4) Elasticity – elastic; as price changes, consumer demand changes
D) Promotion
1) Positioned as high-quality women’s shaving gel
2) Sold by drug and food-and-drug stores through rack jobbers with product placement in the women’s personal-care section minimizing direct price comparison
3) Added moisturizer emphasized on packages and in-store promotions and media advertising
4) Brand loyalty; none of the current customers had used a competing brand in the past two years
E) Place
1) Drug & food-and-drug stores
2) Channel: rack jobbers (wholesalers) that set up and merchandise retail displays
I. Problem/Opportunity
A)
Dermavescent Laboratories, Inc.
I. Summary of Facts
A) Market – Dermavescent Laboratories, Inc. manufactures women’s personal-care products
1) Two primary markets
a) Drug stores
b) Food & Drug stores
c) Sold through rack jobbers who receive a margin of 20% off the sales price to retailers
2) Dermavescent Laboratories, Inc.
a) Sales of $258 million in 2005
b) Sales for Soft & Silky Shaving Gel were $3,724,000 at 1,960,000 units in 2005
c) Downward trend with a 0.32% decrease if no new packaging is introduced
3) Competition
a) Oligopoly – As of 2005, several competing brands existed in the women’s shaving cream or gel category.
B) Products
1) Women’s personal-care products
a) Soft & Silky Shaving Gel introduced in 1991
b) Other women’s products such as facial creams, hand body lotion, and a full line of women’s toiletries sold under different brand names.
2) Benefits
a) High-quality women’s shaving gel
b) Added moisturizer, lanolin and vitamin E to help moisten, reduce irritation, and make shaving easier
3) Product life cycle
a) Maturity/Decline – unit sales volume for Soft & Silky Shaving Gel have slowed and then plateaued.
C) Price
1) Premium priced at $3.95 per 5 ½ ounce tube
2) Retailers receive a 40% margin on the suggested retail selling price
3) Rack jobbers receive a margin of 20% off the sales price to retailers
4) Elasticity – elastic; as price changes, consumer demand changes
D) Promotion
1) Positioned as high-quality women’s shaving gel
2) Sold by drug and food-and-drug stores through rack jobbers with product placement in the women’s personal-care section minimizing direct price comparison
3) Added moisturizer emphasized on packages and in-store promotions and media advertising
4) Brand loyalty; none of the current customers had used a competing brand in the past two years
E) Place
1) Drug & food-and-drug stores
2) Channel: rack jobbers (wholesalers) that set up and merchandise retail displays
I. Problem/Opportunity
A)