Brand Recognition In Trash Bags Marketing Essay

This case deals with the research analysis of the market conducted by the company Ad-Lider Embalagens, SA to determine the variables that would impact the launch of the new drawstring trash bag product named Climp Fecha Facil. In this research the company was looking for the consumer preferences, consumer habits and the perceived competitive advantages. The research was in two steps: (1) Focus group interviews and (2) Individual Interviews in the test market.

What we can analyze from the observations is that the company through this new product is actually targeting for an 18.79% market share of trash bags with handles. The company instead of going for all the sizes the company must choose the heavier/larger volume bags for this product because lighter bags with handle will not add the sufficient utility to the product. The color being the prime perception for the resiliency of the bag should be black (or anything dark but shouldn’t be transparent at all).

Finally the distribution (place) and price are two major factors the company must look at. The promotion and advertising programs must be carried out in order to communicate the value of the product effectively. Furthermore sales should be carried out in the supermarkets as well as with the help of door to door mass merchandisers.

STATEMENT OF THE PROBLEM

In the year 2001 the company (located in Brazil) Ad-Lider Embalagens SA, is planning to launch a new product for the trash bag market named as “Climp Fecha Facil (Easy close).

Management Problem: The main problem of the management is to identify the key attributes that will impact the “Launch of the new product”. Furthermore, the management thinks that the current products mix of the company will not bring Satisfactory Profits in the Long Term.

Short Term Management Goals: Successful launch, with the right marketing mix for Climp Fecha Facil trash bags.

Long Term Management Goals: Add diversification to their trash bag product line which will help them attain long term profit goals.

To cope with the problems above the company decided to go for a market research survey. The reason behind the market research is to analyze what pricing, packaging, distribution and promotion the company must follow to make this product a big success. The trash bag product has a big market of around 1.3 billion pieces valued at US$ 120 million. The customers are widely dispersed and understanding their behavioral aspects regarding the use of trash bags is of vital importance to the company. The company is already having many trash bag products in the consumer market and one bad product launch can hurt its brand equity in long term and vice versa.

Also for the management, the current product mix is not sufficient and diversified enough to attain long term profits but the addition of this product, which is different, modern and has high cost-benefit relationship, will surely help in attaining that long term profit goals.

Marketing Research Problem: The Company through this marketing research is actually planning to evaluate the consumer preferences, consumer habits and perceived competitive advantages that would impact the launch of the product (includes pricing, size, distribution, packaging and promotion).

CAUSES OF THE PROBLEM

The reason behind this research is the customer centric approach; the company wants to incorporate in this product. Also the consumers are widely distributed and understanding their preferences and usage behaviors will definitely help the company make this product launch successful.

Consumer Preferences are related to the environmental factors the consumers are facing and this have a strong effect on their consumption habits. As seen in the case that the market research done in two metropolitan cities shows great variation in terms of size of the trash bags, the usage frequency, color and packaging. Without correct knowledge of this pattern, even a product with a marvelous idea will fail. For every customer the cost to benefit ratio is very important and he or she will not waste money on a household item (non-luxurious) until and unless the relative benefit is fully justified. Trash bag is a less-involvement buy for most of the consumers, so understanding the niche within the product for the customers will help the company customize the new offering for the consumers.

MARKETING RESEARCH (Theories and Processes)

Before getting into the detail of the marketing research process, first of all we will look at the economic classes with the help of which the company designed the research.

Economic Social Classes: This is the secondary data of the customer social classes developed by the Brazilian Market Research Association (ABIPEME). Following is the classification with the pi-charts to understand the distribution of population, their relative consumption against the total national consumption and their respective income against the national income.

Social Class

Population (In terms of % of total)

% to Total consumption

A&B

19%

52%

C

30%

28%

D&E

51%

20%

Total

100%

100%

As we can see in the pi-charts that class A&B even with the lower population has the highest %age of the total consumption. According to ABIPEME Social Class A&B possessed the highest levels of income and that is why they contribute towards the total consumption more.

Wealth Distribution

%age to National Income

Upto 10%

47%

From 10% + to 50%

39.50%

From 51% + to 100%

13.50%

As seen in the Pi-charts that top 10% (class A&B – not motioned in the case) comprised of the 47% of National Income and is of prime concern for any product marketing plan. All these facts will become the prime basis for the formation of procedures of the market research.

Marketing Research Process: The process of research is done in two ways. (1) Focus group interviews with open ended questions – Exploratory Research (2) Individual Interviews in the test market – Confirmatory Research.

(1) Focus Group Interviews – Exploratory Research: Three groups of women (targly.et audience) are interviewed, out of which two are from Sao Paulo (Population: 20.2 million) and one from Rio De Janerio (Population: 12.15 million). Sao Paulo women are living in apartments (one group) and houses (one group) while the women in Rio live in apartments. The women (Houses – Sao Paulo) were aged 28-40 with children, having min high school education (some having professional careers as well). Women (Apartments – Sao Paulo) were aged between 28-39, mixtures of married and single, having university degree (most of them) and have a professional career. The women (apartments -Rio De Janerio) aged between 32-42, mixtures of single/divorced and married, having high school education (majority of them) and only minority of them have a professional career. The income structures of all the 3 groups are approximately same. Hence the diversification in choosing the focus group is good.

The women were selected from the Social class A & B because this class accounts for 52% of the total consumption. The two cities chosen were the largest metropolitan cities in Brazil so the focus groups were chosen from the right cities where the usage behavior can be studied quiet accurately. What is missed in the focus group is the study of the social class “C” that accounts for 28% of total consumption or the company might have decided to target the A & B social class people only. Houses in Rio are also not taken into account as well. Following are some key finding their interpretations and their implications.

Groups

Wives (Apartments, Rio)

Category Evaluated

Findings

Interpretations

Implications

Day to Day Household activities

Quite Involved

Women are looking after the house keeping and trash bags usages

The women are the target audience and their needs are to be catered first.

Color of Trash Bags used

Mostly Blue and sometimes black.

The black color isn’t available (other than 100L) that’s why the women are using the blue color.

The core need behind this color for them is opacity which needs to be translated into the new product design.

Brand Recognition in Trash Bags

Yes, but only Dover roll brand is recognized.

Dover roll must have been running the advertising and promotion campaigns

To get in this market the company must run a promotion and advertising campaign for awareness.

Capacity of Trash Bags Used

15L, 30L & 50L. Small supermarket bags used as well but not very often.

Not all the sizes are used in Rio.

Analysis is required to know why above 50L volume trash bags aren’t used. Also the problems relating to different volumes of bags.

Brand Loyalty

High

–

Promotion and Advertising are required to convey the utility of the new product.

Price Sensitivity

Low

–

–

Problems in Handling the Trash Bags.

Difficulties in tying and handling when full (fear of getting bag ripped)

Women need some mechanism to tie and move the trash bags easily.

Product design is right but analysis is required whether this is the main problem of the product or not.

Why Dover Rolls and Supermarket Bags are used.

Dower rolls (w/handle) and super market handles are preferred because they can be tied easily.

Tying and handling are definitely posing problems to the customers. Dover rolls (w/handle) have problems in unrolling and tying (weak/brittle ears).

This can be the USP (Unique Selling Proposition) for the new product the company is planning to market.

Purchase of Garbage Bags

From Supermarkets mainly.

–

In the super markets the placement and the display of the trash bags are the most important concerns.

Purchasing Motivators.

Resilience, Size and Price of trash bags

Handling of the bags isn’t mentioned but the resilience strength issue is directly related to handling of the bags. Resilience being the most important aspect for buying.

The company must evaluate the strength of the bags available in the markets and offer a better one with the most used size and best price.

What is an Ideal Package of Trash Bags for Consumers?

What an Ideal Package should have?

(1) Easy to Close (2) Resilient (3) Not transparent at all.

These are three important factors according to the women the ideal bags must have.

Since the company has the information about what the women (end customers) are expecting they can design and market the same.

Ideal Trash Bags Packaging.

Folded not preferred.

Folded aren’t preferred at all because they are considered expensive, would wrinkle and get wet.

Price is the issue with the packaging.

Colors of Ideal Trash Bags.

Must be opaque.

Color blue is preferred but opacity is the most important concern.

Transparent bags must be avoided and dark colors are to be used.

After: Climp Fecha Facil Presentation

Likeness of the new article.

Liked the concept

–

–

Color of Climp Fecha Facil

No Consensus in color but for sure they didn’t want it to be transparent.

–

–

Sizes of Fecha Facil

30L – 50L + Trash bags is preferred.

Since the 50L bags are considered heavier to handle that is why they are preferred.

The company must analyze the waste loading (in kgs/lbs) in all volumes of the bags and then decide which sizes require this drawstring arrangement.

Other Uses of the bags

For Storage purposes.

Storing old and dirty clothes, shoes and towels.

This utility can be used for marketing low capacity Climp Fecha Facil trash bags.

Price Sensitivity with Fecha Facil.

Willing to pay a little premium for this bag.

–

–

Groups

Wives (Apartments, Sao Paulo)

Category Evaluated

Findings

Interpretations

Implications

Day to Day Household activities

Quite Involved

Women are looking after the house keeping and trash bags usages

The women are the target audience and their needs are to be catered first.

Color of Trash Bags used

Black Color only

Black color is a sign of strength and resilience, other colors are considered weak and inferior.

Black color is the main criteria for deterring strength so the product should be marketed in black color

Brand Recognition in Trash Bags

Not really

They aren’t bothered by the brand they are buying only the resilience and color is looked upon.

Earlier in the case women do believe that advertising will influence the buying decisions, so advertising needs to be carried out.

Capacity of Trash Bags Used

20L, 30L, 40L, 50L, 60L to 100L trash bags are used. Small Super market bags are also used more often.

Almost all the sizes are used.

Thorough analysis is required regarding the problems with different volumes of bags.

Brand Loyalty

Low (switchers)

–

The utility of the new product must be conveyed in terms of cost benefit ratio.

Price Sensitivity

High

–

–

Problems in Handling the Trash Bags.

Difficulties in tying and handling when full (fear of getting bag ripped)

Women need some mechanism to tie and move the trash bags easily.

Product design is right but analysis is required whether this is the main problem of the product or not.

Why Dover Rolls and Supermarket Bags are used.

Super market bags are easy to tie.

Tying and handling are definitely posing problems to the customers.

This can be the USP (Unique Selling Proposition) for the new brand the company is planning to market.

Purchase of Garbage Bags

From Supermarkets mainly.

–

In the super markets the placement and the display of the trash bags are the most important concerns.

Purchasing Motivators.

Size, Price and Resilience of trash bags.

Resilience is the least important because the perception of the resilience and strength is directly related to the black color.

Black color bags are to be marketed with the most used size and best price.

What is an Ideal Package of Trash Bags for Consumers?

What an Ideal Package should have?

(1) Easy to Close (2) Resilient (3) Not transparent at all.

These are three important factors according to the women the ideal bags must have.

Since the company has the information about what the women (end customers) are expecting they can design and market the same.

Ideal Trash Bags Packaging.

Rolls aren’t preferred.

Because trash bags are ripped when unrolled in hurry and also the handling of the rolls are difficult. Boxes though look expensive but are easier to handle.

Folded Boxes are helpful in differentiating the brand from the others and are easier to handle so the company should use this packaging.

Colors of Ideal Trash Bags.

Black Color only

Strength is related to the black color of trash bags.

Black color trash bags are to be marketed because it exhibits strength.

After: Climp Fecha Facil Presentation

Likeness of the new article.

Liked the concept

–

–

Color of Climp Fecha Facil

No Consensus in color but for sure they didn’t want it to be transparent.

–

–

Sizes of Fecha Facil

30L – 50L + Trash bags is preferred.

Since the 50L bags are considered heavier to handle that is why they are preferred.

The company must analyze the waste loading (in kgs/lbs) in all volumes of the bags and then decide which sizes require this drawstring arrangement.

Other Uses of the bags

For Storage purposes.

Storing old and dirty clothes, shoes and towels.

This utility can be used for marketing low capacity Climp Fecha Facil trash bags.

Price Sensitivity with Fecha Facil.

Can pay the same as Dover Rolls with handles.

–

Pricing are to be matched or the higher price must be communicated via advertising

Groups

Wives (Houses, Sao Paulo)

Category Evaluated

Findings

Interpretations

Implications

Day to Day Household activities

Quite Involved

Women are looking after the house keeping and trash bags usages

The women are the target audience and their needs are to be catered first.

Color of Trash Bags used

Black Color only

Black color is a sign of strength and resilience, other colors are considered weak and inferior.

Black color is the main criteria for deterring strength so the product should be marketed in black color

Brand Recognition in Trash Bags

Not really

They aren’t bothered by the brand they are buying only the resilience and color is looked upon.

Earlier in the case women do believe that advertising will influence the buying decisions, so advertising needs to be carried out.

Capacity of Trash Bags Used

20L – 30L bags are used as supermarket bags. 50L (inside house) and 100L (outside house) trash bags are mostly used as trash is collected thrice weekly.

Almost all the sizes are used.

Thorough analysis is required regarding the problems with different volumes of bags.

Brand Loyalty

Are loyal to their door to door mass merchandisers.

–

Mass merchandisers are to be contacted for the sales and promotion of the bags.

Price Sensitivity

No Info

–

–

Problems in Handling the Trash Bags.

Difficulties in tying and handling when full (fear of getting bag ripped especially for 100L Bags)

Women need some mechanism to tie and move the trash bags easily.

Product design is right but analysis is required whether this is the main problem of the product or not.

Why Dover Rolls and Supermarket Bags are used.

Super market bags are easy to tie.

Tying and handling are definitely posing problems to the customers.

This can be the USP (Unique Selling Proposition) for the new brand the company is planning to market.

Purchase of

Garbage Bags

Door to Door Trash Bags Merchandisers are mostly preferred.

Since Super market trash bags are weak therefore door to door mass merchandisers are preferred.

In addition to the super markets the company must contact with these mass merchandisers and sell their products through them as well.

Purchasing Motivators.

Size, Price and Resilience of trash bags.

Resilience is the least important because the perception of the resilience and strength is directly related to the black color.

Black color bags are to be marketed with the most used size and best price.

What is an Ideal Package of Trash Bags for Consumers?

What an Ideal Package should have?

(1) Easy to Close (2) Resilient (3) Not transparent at all.

These are three important factors according to the women the ideal bags must have.

Since the company has the information about what the women (end customers) are expecting they can design and market the same.

Ideal Trash Bags Packaging.

Rolls aren’t preferred.

Because trash bags are ripped when unrolled in hurry and also the handling of the rolls are difficult. Boxes though look expensive but are easier to handle.

Folded Boxes are helpful in differentiating the brand from the others and are easier to handle so the company should use this packaging.

Colors of Ideal Trash Bags.

Black Color only

Strength is related to the black color of trash bags.

Black color trash bags are to be marketed because it exhibits strength.

After: Climp Fecha Facil Presentation

Likeness of the new article.

Liked the concept

–

–

Color of Climp Fecha Facil

No Consensus in color but for sure they didn’t want it to be transparent.

–

–

Sizes of Fecha Facil

Preferred in 50L but not in 100L

Since 100L are too heavy and the material is hard and brittle and also the concept is not yet tested by them at their houses therefore the women don’t trust this drawstring for 100L trash bags.

The company must analyze the waste loading (in kgs/lbs) in all volumes of the bags and then decide which sizes require this drawstring arrangement.

Other Uses of the bags

For Storage purposes.

Storing old and dirty clothes, shoes and towels.

This utility can be used for marketing low capacity Climp Fecha Facil trash bags.

Price Sensitivity with Fecha Facil.

Willing to pay a little premium for this bag.

–

–

Hypothesis from the Focus Group Studies – Exploratory Research: Following are some of the key factors noted from the focus group studies. The hypothesis is purely qualitative and it can vary after the confirmatory research.

Marketing Mix (4P’s of Marketing): The marketing mix product, price, place and promotion are the most important tools when determining the product/brand offering. Following are the details of the marketing mix relationships to consumer behaviors and their implications the company should act on.

Attributes for Ideal Climp Fecha Facil Trash Bags

Relationship with Consumer Preferences

Implications

PRODUCT

Capacity

More is better

The ideal package should have a larger capacity, as seen in the interviews people want this bag to be in 50L and more capacity mostly.

Color

The darker the better.

Dark Colors are to be chosen (most preferable is black). Anything transparent will not work at all.

Packaging

The easier to handle the better it is.

The packaging must be chosen keeping in mind what market segment the product is going to sell. The packaging must be differentiated from the rest, easy for the customer to handle and must have all necessary attributes of product mentioned on it.

Handling

Directly proportional

This product is marketed catering this specific need of the customer. The company must promote this USP in its promotion and selling campaigns.

Resilience

Directly proportional

The company must do one more research regarding the average loading per unit volume the customer is currently putting in. This will give the company a better insight what strength of the material they should use for different capacities.

Other Usage

The more the multipurpose use, the better it is.

The company should also look in for other usage of these bags in the houses like storing dirty clothes, shoes, towels and old books. Smaller volume bags with different texture might help. This should be the part of their promotions as well.

PRICE

Price

The lower the better

The product is not new but it has some great benefits over others. Moreover the product is catering to the main problem of women i.e. handling, closing and tying. Starting with a competitive price in the introduction period and increasing it gradually in the growth period might help.

PLACE

Purchase of Garbage Bags

The easier the access, the better the availability, the better it is.

Visibility in super markets is to be taken care of. Also more distribution channels are to be engaged with this product.

PROMOTION

Brand Recognition – Promotion

The more the promotion the better.

As accepted by all the women in focus groups accepted that advertising does impact their purchase decision so a fair amount of advertising budget has to be allocated for this product.

Cost-Benefit Relationship

The higher the better.

This is what the company should promote in its marketing campaigns aggressively.

(1) Individual Interviews in Test Market – Confirmatory Research: This research was conducted at the Sendas Super Market in the city of Rio De Janerio. The research was conducted in May-June 2001 and individual interviews were conducted on every Saturday. 528 interviews were conducted of which 295 were considered valid.

There are some flaws in the research though. First of all, the metropolitan city should be Sao Paulo not Rio De Janerio because of the larger no. of consumers in the market. Secondly, the data before the product placement in the market is missing hence we can neither compare the market share gain by the product nor the cannibalization effect of Climp Fecha Facil on Limp-o-Lixo. Moreover, there were discounts going on in the first two weeks for Dower Rolls and in the last week for the Limp-o-Lixo brand, hence these figures will not be a representative of actual facts and also it is not mentioned in the case that how much discounts did the companies give on their related products and what impact it had on the sales of that product. Finally the performance motivators are purely qualitative converted into quantitative (through individual interviews) by whatever means no mentioned in the case.

Even with some flaws in the market test, the results were quiet encouraging and some of them really confirmed the data we got through focus groups interviews. Following are some pi-charts and bar charts for the data mentioned in the case.

# 01: Women are the main purchasers of the trash bags. Hence it is confirmed that the focus group sampling is correct.

# 02: The drawstring or w/handle trash bags have a market share of 18.79%. This will change eventually because people will switch from trash bags without handles to w/handles.

# 03: Out of the 18.79% of the w/handle trash market share, Climp (as a brand) has a share of 88.17% while Dover roll w/handle has only 11.83% market share. Climp even at the launch became the market leader due to its practicality and ease in use/

# 04: Limp-o-Lixo (Ad-Lider Embalagens) is the leading brand followed by Climp (Ad-Lider Embalagens) and then Dover Roll (Fort-Roll Ind. Com. Exp. Ltda). The Dover roll w/handle in terms of market share is far less than Climp.

# 05: In terms of company share in market Ad-Lider is the leading company with a share of 55.35%. So, Ad-Lider is the market leader by all means.

# 06: Limp-o-Lixo is the leading brand both in males and females. Climp is the leading brand in the w/handles trash bags. The only prominent difference we can among their buying behaviors is that male customers are buying more Super market trash bags (Sendas) as compared to the female customers. So, women customers aren’t the one buying the Super Market Bags, it’s the male customers that are.

# 07: Customers are buying Climp in all the capacities as compared to Dover Rolls w/handles (where buying is done in sizes of 30L, 50L and 100L only). In all the capacities sales of Climp trash bags are higher than Dover Rolls w/handles. The major competitor for Climp trash bags in 15L and 30L capacities are the Sendas Supermarket trash bags (as mentioned in the case these super market bags have ears for tying and closing).

# 08: From the chart above we can say that the biggest motivator for buying Sendas Supermarket bags is the price (low price). The best purchase motivator for DR w/handle is the brand name followed by quality, price and practicality. Finally the best purchase motivator for the Climp brand is it practicality, followed by quality, brand, benefit cost and price. So, the company needs a little promotion to increase its brand awareness.

RECOMMENDED SOLUTIONS, IMPLEMENTATIONS AND JUSTIFICATIONS

After reconciling the findings in both exploratory and confirmatory research, we came to the following solution.

The company should produce the Climp Fecha Facil bags in the sizes of 50L+ to 100L but not in 15L and 30L, because the utility of the drawstring handle will not be justified in smaller capacity bags and therefore people will not pay a premium price for it.

The color for the bags should be black, because this shows resilience. During the focus groups interviews, when price sensitive customer were showed two trash bags (one with blue and other with black color), they didn’t find the black one expensive. For the drawstring green color as mentioned by the women in focus group can be used.

No confirmatory data for folded bags were given in the test market interviews, so I assume that Climp Trash bags were introduced in test market in rolls. Since boxed/folded trashed bags are perceived expensive so the Climp bags should be marketed in the roll forms. Care has to be taken that packaging must differentiate the product from the rest and it must have all the necessary data about size and usage.

The company can charge a price with a justifiable premium, the drawstring utility adds to this product. As seen in the confirmatory test market interviews, that people aren’t price sensitive for this product and hence can pay a premium for this product.

The distribution has to be carried out through supermarkets as well as door to door mass merchandisers. The visibility and ease of access factors are to be taken care of, for the super markets. Since confirmatory data for the houses of Sao Paulo is not given, so I infer from the focus group studies that door to door mass merchandisers can be contacted to cater the Housewives customers.

Promotion should be carried out for this product for two purposes. (1) To make people aware about the utility of this product and also other usages, (2) To increase the brand equity of this product. This action will definitely boost sales and more people will start using this product.

REFRENCES

1. Malhotra, N. K., & Dash, S. (2010). Marketing Research, An Applied Orientation. (6 ed.). Pearson Prentice Hall.

2. Kotler, P., Keller, K. L., Koshy, A., & Jha, M. (2009). Marketing Management, A South Asian Perspective (13 ed.). Delhi, India: Pearson Prentice Hall.