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• The primary motive is to understand the branding strategies and of the

company to promote its No. 1 in cosmetic.

• The secondary motive is to understand how the company overcomes the

challenges put forward by the rival companies on competition promotion and
marketing strategies of its product.

• It was impossible to gather the current sales of ‘Lakme’ and the current
branding strategy applied by the company because as a part of secret
information of the company they have not disclosed it.

• It was also not possible to know the top position in the sales of cosmetics
this year, as the company has still not come up with its facts and figures.

The research is based on:-

Primary Data
1) Questionnaire

Secondary Data
1. Internet
2. Company Reports & Broachers
3. Magazines
4. Newspapers Articles & Journals

Data is also gathered by talking to the respondents (Target Audiences,

understanding their beauty needs, what aspire them to go for the brand.
Also the level of:-
1) Brand awareness
2) Price level,
3) Visibility of brand personality
4) Expectancy of communication

All these factors were the prime criterion for selecting (which brand), short listing
and ranking (level of trustworthiness or most favoured) which had helped us for
identifying the winner in cosmetics industries.
1) Help in building a positive association with people thereby enhancing brand
2) How to break the negative connotation of “BEING FASHIONABLE”.
3) Why has lakme missed out on promotional gauge despite roping in top brand
4) How can the brand retain its lost spot?


Our research is based on the Exploratory study.

Research is exploratory when you use no earlier model as a basis of your study. The
most usual reason for using this approach is that you have no other choice.
Normally you would like to take an earlier theory as a support, but there perhaps is
We have collected our data by drafting a questionnaire and thereby interpreted or
analyzed or result by using the Microsoft excel.

Sample design
• The sampling procedure used to produce any type of sample
• Sample size of 100 customers

In 1995, Lakme Ltd. And HLL formed a 50:50 venture Lakme lever that would
market and distribute Lakme’s product. In 1998, Lakme sold its brand (and 50% it
owned in the JV ) to HLL, renamed itself Trent and entered a different business
(retail). Only, the years between 1995 and 2000 saw HLL wrestling with several
issues with a bearing on Lakme’s future.

A brand that has over 5 decades talked of beauty is none other than Lakme.
Launched in 1952, it offered a range of cosmetics with nail polishes and lipsticks
from the early 80’s. Lakme also understands the importance of maintaining and
accentuating a women’s natural beauty, for this it has introduced a range of skin
care products from 1987. These ranges have been constantly innovated to bring
specialized beauty care and complete the range for the definitive women.


• Local brand of specific relevance to India.
• Strong R&D capability well linked with business.
• Integrated supply chain and well spread manufacturing units.
• Ability to deliver cost savings.
• Access to unilever global technology capability and sharing of best practices
from other unilever

• Price positioning in some categories allows for low price competition.
• Varying quality range in its products.
• Falling quality range in its products.

• Brand growth through increased consumption depth and frequency of usage
across all categories.
• Upgrading consumers through innovation to new levels of quality and
• Building brand image by collaborating with top designers in lakme fashion

• Aggressive price competition from local and multinational players.
• Spurious/ counterfeit products in rural areas and small towns.
• Non existence of brand image in long run.


Lakme daily wear soufflé, lakme perfecting liquid foundation – lakme radiance
compact, lakme flawless matte complexion compact.

Lakme enrich lipcolor – perfecting definition lip pencil – starshine lipgloss

From dramatic to natural look – a wide range of products are on offer to create the
perfect eyes.
1) Lakme Kajal
2) Lakme Insta Eyeliner eyelids

True wear nail enamel – nail enamel with lacquer – like finish. Contains resins and
silicone with colour lock technology that gives brilliant long lasting shine.
For radiant skin lakme is there to pamper your skin with specialized products for
the diva in you.

Lakme fundamental peach milk moisturizer skin.

High priestess of sacred Indian temple meets English army officer who’s unwittingly
strayed into holy ground. They fall in love.Her orthodox father vows vengeance….
That’s the story of Lakme, a 19th century opera written by Frenchman Leo Delides,
from which Simone Tata borrowed the name Lakme (French for lakshmi, the name
of the priestess ).

The current size of the Indian cosmetic market is approximately US $600 million.
Of this, the fastest growing segment is color cosmetics, accounting for around US
$60 million of the market. Growth has come mainly from the low and medium
prized categories that account for 90% of the cosmetics market in terms of volume.

Even with a 20% average growth rate, the per capita consumption is very low in
However, with changing lifestyle, higher disposable income, increasing advertising,
penetration of satellite television, awareness of the western world and growing
importance of beauty pageants, there has been significant changes and use of
cosmetics is on the rise.

Lakme, a brand originally introduced by the Tata Group of India, now bought over
by Hindustan Unilever (HUL) of the Unilever group, tips and toes, another domestic
Multinational’s, Revlon of the US and the Loreal’s Maybelline has a dominant share
of a small premium lipsticks and nail enamels market.

The skin care market in India is estimated at US $ 80million. Within the last decade,
this segment has seen many consumer’s slowly shift from the mass to the premium
end of the market. The penetration rate is high in the skin care segment as
compared to color cosmetics.

Penetration levels of international cosmetics brand in India are still low. Foreign
brands currently constitute only 20% of the market.

A market reason for low penetration of International brands can be attributed to

high prizing. Urban women in middle and upper Income groups in the age range of
23-50 is a target group for International brands, as this group looks for better
products and is willing to pay a premium for International quality products.
Industry estimates suggest that there are close to 10million such women in India.

Advertising and promotion is crucial for cosmetics and toiletries products, in order
to create an awareness of new products and build brand loyalty among consumers.
Advertisements in TV and the print media such as Newspapers and Magazines,
especially women’s magazine, are very common.
The market is saturated with many different types of products, and in the long run,
established brands that emphasize quality and service will have the edge.
A Product of Hindustan
Unilever Ltd.

Submitted by:
Ridhima Khattar
BBA (b&i) 1st shift 3rd SEM
Executive summary

About the project

Within a short span of the last five-six years, the use of cosmetics by Indian users
has increased significantly with more and more women and men taking greater
interest in personal grooming, increasing disposables incomes, changing lifestyles,
influence of satellite television and greater product choice and availability.

This cosmetics and personal care industry has been growing at an average rate of
20% for the last few years. The growing Indian cosmetics market offers promising
prospects for international brands. The growth rate in the cosmetics market reflects
an increasing demand for beauty care products in India. Perfumes and fragrances,
skin care and hair care products are some of the major segments with promising
prospects for US companies.

Penetration of most cosmetic and toiletries is very low in India. Current

consumption of many products is well below that of many countries in Asia.

India is a very price-sensitive market and mass-market products constitute the

major part of the cosmetics and toiletries market. India’s import of cosmetics and
toiletries and intermediate raw materials is around US$ 120 million, of which the
US has a share of approximately 10 percent.

Beauty is skin deep… and sure enough lakme understand it like no one does. Today
brand lakme stand strong as one of the 100most powerful brands and right fully
so,for its ‘THE’ brand that lights up the face of million people everyday.

It’s a brand that inspire, motivate and infuses confidence colours, shades, brushes
and tones to beautify, have been the core attributeof the products. The challenge
which the cosmetic industry has to break was the negative connotation of “being
fashionable”. Though the brand missed out on during the past year despite having
roped top brand ambassadors is that it scored low on promotional gauge.

In the following project we basically seeks to provide experiential marketing

solutions to a brand (Lakme). We also gauge into reasons that why lakme’s position
as market leader was threatened when international majors like Revlon and
Maybelline entered the fray in the mid-90s. The research process was entailed by
visiting lakme outlets in noida, which includes the response received from target
audiences(min age 19 yrs- max- 45yrs) via through questionnairefor deeper insights.

Hindustan Unilever Limited (abbreviated to HUL), formerly Hindustan lever

limited, is India’s largest consumer products company and was formed in 1933 as
Lever Brothers India Limited. It is currently headquartered in Mumbai India and
its 41000 employees are headed by Harish Manwani, the non- executive chairman of
the board. It is fast – moving consumer goods(FMCG) industry that includes
detergents, soap, shampoo deodorant, toothpaste, and other personal care items,
and cosmetics HUL’s personal care brands include soap brands such as Lux,
Lifebuoy, Liril, Breeze, Dove, Pears and Rexona.
Shampoos and hair coloring brands including Sunsilk naturals and Clinic.
Skin care brands Fair & Lovely and Ponds.
Oral care brands Pepsodent and Close-up.
The company’s cosmetic line is led by the lakme brand.

To earn the love and respect of India, by making a real difference to every Indian…
HLL follows its parent company’s mission to “ add vitality to life”. They strive to
meet everyday needs of nutrition, hygiene, and personal care productsthat help
people “feel good, look good and get more out of life”.

• Grow ahead of the market by leading market development activities.
• Leverage positive impact of growing Indian economy on consumer spending.
• Grow a profitable foods and top end business.
• Grow the bottom – line ahead of top line
• Strong commitment to sustainable development.
The current size of the Indian cosmetic market is approximately US $ 600 million.
Of this, the fastest growing segment is color cosmetics, accounting for around US $
60 million of the market. Industry sources estimate a rapid growth rate of 20% per
annum across different segments of the cosmetics industry reflecting an increasing
demand for all kinds of beauty and personal care products.

The Shahnaz and the Biotique brands dominate the premium herbal cosmetics
segment in India , estimated at USD 100 million.

Since liberalization , many international brands like Avon, Burberrys, Calvin Klein,
Coty, L’Oreal, Oriflame, Revlon ect have entered the Indian market.
The prices of most foreign brands have been fairly high, which has deterred average
Indian consumers. International brands cater to a segment that can broadly be
classified as the urban higher income group.

Cosmetics and toiletries are not just the domain of women any longer and Indian
men too are increasingly taking to the use of more and more body sprays, perfumes
and other cosmetics and toiletries. With rising demand from men, the Indian
market is getting enlarged and many players are coming out with cosmetic products
especially skin care products for men. The market size of men’s personal care
segment is estimated at approximately US $ 165 million, with Gillette having the
largest market share. Other major players in this segment include Godrej, JL
Morison and HLL. The growing demand for men’s cosmetics have made many
direct selling companies such as Modicare and Amway to launch new products for

In the last 5 – 6 years , there has been a renewed craze for herbal cosmetic and
personal care products, especially in the skin care segment with the growing belief
that chemical-based cosmetics are harmful. Shehnaz Hussain , Biotique, and lotus
herbals are the major players in this segment. Many companies also expanded their
range to include herbal variants…

The urban population in the major cities with increasing purchasing power is the
main force that derives demand for various cosmetic products in India. The advent
of satellite television and awareness of the western beauty and fashion world,
advertisements and promotions, increasing number of women joining the work
force is changing preferences, customs and cultures in India.

Costs for importing products are much higher than producing it in the country.
India allows entry of imported cosmetics without any restrictions but the average
import tariff on cosmetics products is currently very high at 39.2 percent. This
makes imported products very expensive for most consumers. Most foreign
cosmetics companies selling premium brands have had a difficult time developing
the low volume premium market in India. Many had to re-work price strategies
towards the mass segment. Price is not the only reason responsible for their
problems. Poor assessment of the size of the upper middle and high income groups,
and price sensitivity even within these groups had added to their problems.
According to estimates of industry experts and trade publications, India’s annual
imports of cosmetics and toiletries and intermediate raw materials are
approximately US $ 120 million. Countries like US, Europe, France, Germany,
Italy, Netherlands and Spain account for the major share. And Australia, China and
Japan account for rest of the share.

The Indian cosmetic market, which has been traditionally a stronghold of a few
major Indian players like lakme and ponds has seen a lot of foreign entrants to the
market within the last decade. Indian is a very price sensitive market and the
cosmetics and personal care product companies, especially the new entrants have
had to work out new innovative strategies to suit Indian preferences and budgets to
establish a hold on the market and establish a niche market for them.

Beauty counselors or advisors at retails outlets have been very successful in gaining
attention, creating product awareness and overcoming consumer’s lack of
familiarity with and fears about many cosmetics and personal care products such as
home hair permanents and color cosmetics. Some companies such as lakme have
even set up exclusive lakme beauty parlors at major cities in India through the
franchisee route.

Loreal markets its range of specialized hair care products exclusively through
salons and beauty parlors. Loreal currently is the only company in the market that
has a hair color range tailored exclusively for parlors…

A strong brand promotional campaign, good distribution network, constant product

innovation and quality improvement, and the ability to provide a variety of quality
products are some of the major reasons for the success of most companies.
The growing Indian cosmetics market offers promising opportunities for
international brands. The growth rate in the cosmetics market reflects an increasing
demand for beauty care products in India. The most promising segments for
international companies to pursue are perfumes and fragrances and specializes skin
care and hair care products. The fastest growing market is however color cosmetics
which account for US $ 60 million of the total market.

The rural market in India for cosmetics and toiletries remains is largely untapped.
Major domestic players have also not been able to penetrate this market. The urban
market itself for specialized cosmetic product remains to be fully exploited. The
Indian skin- care market is not yet fully tapped and offers promising prospects as a
growth area. Penetration of color cosmetics is lower than the penetration prospects
of the skin care segments.

To promote the growth of their products, a dominant player like Lakme has
embarked upon a business plan to establish their exclusive franchised beauty salons
across major metros in the country.

Imported cosmetics have had a major impact on the Indian market. Foreign
products have enhanced growth of the Indian market by attracting aspirational
consumers and increasing acceptance of color cosmetics, previously perceived by
many as harmful to skin. Indians generally perceive foreign brands as being of
superior quality.
• Promotions beyond fashion week.
• The brand should not lose its focus away from cosmetics. It can prove to very
• For vast reach unlikely, in the short-term. “Some sort of an alliance or co-
branding with the salons that already exist may, perhaps have been a better
• The general perception is that company-owned salons are expensive. Though
lakme beauty salons are reasonably priced, it has not been communicated
well enough.

I would like to acknowledge, the guidance & encouragement offered by Seema

Shokeen , it would not have been possible for me to undertake a project
of this nature without the able guidance, corporation & support.

I am thankful to Seema Shokeen for her valuable support and exceptional guidance
throughout my project. I express my gratitude for her continuous support.

I would like to thank the respondents who have spend there valuable time in filling
up the questionnaire.
Ridhima Khattar
Roll No. 06314901809
BBA (B&I) 1st Shift
3rd Semester


This is to certify that the project entitled “LAKME” made by Ridhima Khattar has
been completed under my guidance and I am satisfied with the work carried out by
her. The project is original and has not been submitted earlier to the other
institution. The project was successfully carried out by Ridhima Khattar in partial
fulfillment of BBA (B&I) Ist Shift, 3rd Semester required for leading to the award of
the degree of BBA from Maharaja Surajmal Institute.



• Kotler Philip, Keller Lane Kevin marketing, prentice hall of India, 2007
• S.P Gupta, Business Statistics, 14th edition, 2008
• Business Statistics, J.K Sharma, edition 2009
• Tata Mc graw Hill edition, Business research methods, Donald R.Cooper,
Pamela S.Schindler.


Market Survey for Lakme Products

Name :
Age :
Sex :
Address :
State :
Contact no. :
1. What inspire you to go for Lakme?
• Colour/ Shades
• Price
• Packaging
• Versatility
• Others

2. Are you brand loyal to Lakme or you switch to others too?

• Yes
• No

3. Do you think Lakme provides quality products to its customers?

• Yes
• No
• Cant say

4. For which purpose you usually use Lakme products?

• Eyes
• Lip Colour
• Face
• Nail Enamel
5. According to you what kind of promotional activities can make
Lakme reach customers in a better way which can increase their
market share?
• Lucky Draws
• Free Bonanza
• Free Sample Distribution
• Discount Coupons
• Others

6. What do you think about the price level of Lakme products?

• High
• Optimum
• Low

7. From where do you purchase your product?

• Departmental store
• Cosmetic store
• Drug/ Pharmacy
• Supermarket
• Beauty Salon
• Others

8. If not Lakme, then which other brand?

• Revlon
• Oriflamme
• Blue Heaven
• Loreal
• Lissome
• Others

9. Are you aware of the new range of Lakme products?

• Yes
• No

10. How would you rate the Lakme products?

• Good
• Very good
• Poor
• Average
• Cant say

11. Do the celebrity endorsements in the advertisements attract you

towards the product?
• Yes
• No

12. What changes you would like to see in the Lakme products?
• More product range
• More shades
• Better packaging
• All of the above

13. Will you recommend Lakme products to others?

• Yes
• No
Hypothesis testing using Chi square

Satisfaction Observed (O) Expected (E) ( Oi – Ei )2 X2 = { ( Oi - Ei )2 / E

Level }

Excellent 16 20 16 0.8
Good 20 20 0 0
Average 55 20 1225 61.25
Poor 5 20 225 11.25
Neutral / 4 20 256 12.8
Can’t Say

Overall Satisfaction
X2 = 86.1
Table Value = 9.49
Since the table value is less than X2, so the HO is rejected.

Satisfaction Observed (O) Expected (E) ( Oi – Ei )2 X2 = { ( Oi - Ei )2 / E
Level }
Loyal 18 50 1024 20.48
Not Loyal 82 50 1024 20.48

X2 = 40.96
Table Value = 3.84
Since the table value is less than X2, so the HO is rejected.

Satisfaction Observed (O) Expected (E) ( Oi – Ei )2 X2 = { ( Oi - Ei )2 / E

Level }
Recommend 40 50 100 2
Will not 60 50 100 2

X2 = 4
Table Value = 3.84
Since the table value is less than X2, so the HO is rejected.

Advertising / Communication Effect

Communication Observed (O) Expected (E) ( Oi – Ei )2 X2 = { ( Oi - Ei )2 / E

Level }
Effected 17 50 1089 21.78
Not at all 83 50 1089 21.78

X2 = 43.56
Table value = 3.84
Since the table value is less than X2, so the HO is rejected.
Price Level

Satisfaction Observed (O) Expected (E) ( O i – E i )2 X2 = { ( Oi - Ei )2 /

Level E}
High 30 33.33 11.0889 0.333
Low 5 33.33 802.5889 24.08
Optimum 65 33.33 1002.9889 30.09

X2 = 54.503
Table Value = 5.99
Since the table value is less than X2, so the HO is rejected.