Harvard Case - Dettol: Managing Brand Extensions
"Dettol: Managing Brand Extensions" Harvard business case study is written by Anand Kumar Jaiswal, Arpita Srivastava, Dhwani Kothari. It deals with the challenges in the field of Marketing. The case study is 32 page(s) long and it was first published on : Aug 19, 2007
At Fern Fort University, we recommend Dettol implement a strategic brand extension strategy focused on leveraging its strong brand equity in hygiene and health to enter new, adjacent markets. This strategy should prioritize product innovation, targeted marketing, and a multi-channel approach to reach new consumer segments while maintaining its core brand values of trust, safety, and efficacy.
2. Background
The case study focuses on Dettol, a well-established brand known for its antiseptic and disinfectant products. Facing declining sales in its core market and seeking new growth opportunities, Dettol is considering expanding its product portfolio. The case highlights the company's need to navigate the challenges of brand extension, balancing brand equity with consumer expectations and market dynamics.
The main protagonists are:
- Dettol Management: Facing declining sales and seeking new growth avenues, they are tasked with deciding on the best brand extension strategy.
- Consumers: Dettol's target audience, who are increasingly seeking health and hygiene solutions in various aspects of their lives.
- Competitors: Other brands in the hygiene and personal care market, posing a threat to Dettol's market share and brand positioning.
3. Analysis of the Case Study
To analyze the case, we can utilize the following frameworks:
1. SWOT Analysis:
- Strengths: Strong brand equity, established distribution network, trust and familiarity among consumers, expertise in hygiene and disinfection.
- Weaknesses: Limited product portfolio, potential dilution of brand image with inappropriate extensions, reliance on traditional marketing channels.
- Opportunities: Expanding into new product categories like personal care, home hygiene, and baby care, leveraging digital marketing and e-commerce platforms, entering emerging markets.
- Threats: Intense competition in the hygiene and personal care market, changing consumer preferences, potential regulatory changes, economic fluctuations.
2. Porter's Five Forces:
- Threat of New Entrants: Moderate, due to the established brand presence and high barriers to entry in the hygiene and personal care market.
- Bargaining Power of Buyers: Moderate, as consumers have various choices and can switch brands easily.
- Bargaining Power of Suppliers: Low, as Dettol likely has multiple suppliers for raw materials and packaging.
- Threat of Substitute Products: High, as consumers can choose alternative products from various categories for specific needs.
- Competitive Rivalry: High, with numerous established and emerging brands competing for market share.
3. Ansoff Matrix:
- Market Penetration: Focus on existing products and markets, potentially through price promotions or product improvements.
- Market Development: Entering new markets with existing products, targeting new geographic locations or consumer segments.
- Product Development: Introducing new products in existing markets, leveraging Dettol's expertise in hygiene and health.
- Diversification: Entering new markets with new products, potentially venturing into unrelated fields.
4. Recommendations
Based on the analysis, we recommend Dettol pursue a strategic brand extension strategy focused on product development and market development. This approach leverages Dettol's existing strengths and minimizes risks by focusing on adjacent categories with strong consumer demand.
Specific recommendations include:
- Develop new product lines: Focus on hygiene and health-related products within adjacent categories like personal care (hand washes, body washes, soaps), home hygiene (surface cleaners, laundry detergents), and baby care (baby wipes, baby lotions).
- Leverage existing brand equity: Maintain the core brand values of trust, safety, and efficacy while adapting product formulations and packaging to appeal to new target markets.
- Target specific consumer segments: Conduct thorough market research to identify specific consumer needs and preferences within each new category.
- Utilize a multi-channel marketing approach: Integrate traditional advertising with digital marketing strategies, including social media, influencer marketing, and e-commerce platforms.
- Develop a clear pricing strategy: Balance premium pricing with competitive pricing to attract new customers while maintaining brand image.
- Invest in product innovation: Continuously develop new products and formulations to stay ahead of competition and meet evolving consumer demands.
- Monitor brand performance: Track sales, market share, and consumer feedback to ensure the brand extension strategy is successful and adjust as needed.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core competencies and consistency with mission: Dettol's core competency lies in hygiene and health, and the recommended extensions align with this expertise while expanding its product portfolio.
- External customers and internal clients: The recommendations address the needs of both existing and potential customers by offering new and relevant products while maintaining the brand's trusted image.
- Competitors: The recommendations aim to differentiate Dettol from competitors by focusing on specific consumer segments and offering innovative products.
- Attractiveness ' quantitative measures: The potential for growth in the chosen categories is high, with strong market demand and potential for significant revenue generation.
6. Conclusion
Dettol's brand extension strategy should focus on leveraging its strong brand equity in hygiene and health to enter new, adjacent markets. By prioritizing product innovation, targeted marketing, and a multi-channel approach, Dettol can achieve sustainable growth while maintaining its core brand values.
7. Discussion
Other alternatives not selected include:
- Market penetration: While focusing on existing products and markets might offer short-term gains, it could limit long-term growth potential.
- Diversification: Entering unrelated fields could dilute the brand image and pose significant risks due to lack of expertise and market knowledge.
Risks associated with the recommended strategy include:
- Brand dilution: If the product extensions are not carefully developed and marketed, they could negatively impact the brand's image.
- Competition: The hygiene and personal care market is highly competitive, requiring Dettol to continuously innovate and adapt to maintain market share.
- Consumer acceptance: New products may not be readily accepted by consumers, requiring effective marketing and communication strategies.
Key assumptions:
- Consumers are willing to trust Dettol in new product categories.
- Dettol can successfully develop innovative products that meet consumer needs.
- Dettol can effectively reach new target markets through a multi-channel marketing approach.
8. Next Steps
To implement the recommended strategy, Dettol should:
- Conduct thorough market research: Identify specific consumer needs and preferences in each new category.
- Develop a product roadmap: Define new product lines and timelines for product development and launch.
- Develop marketing campaigns: Design targeted marketing strategies for each new product and market segment.
- Establish partnerships: Collaborate with retailers and distributors to ensure effective product distribution.
- Monitor brand performance: Track sales, market share, and consumer feedback to ensure the strategy is successful.
By taking these steps, Dettol can successfully navigate the challenges of brand extension and achieve sustainable growth in the hygiene and personal care market.
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Case Description
This case is about the evolution of a parent brand and its subsequent extensions into different product categories. Dettol, as a brand, had earned immense trust and loyalty from consumers. From the time it was introduced in India in the 1930s, Dettol occupied a distinct position in the mind of its consumers. To accelerate growth and leverage the strong brand equity of Dettol, Reckitt Benckiser India Limited (RBIL) rolled out a number of brand extensions. Some of these extensions, such as Dettol soap and Dettol liquid hand wash, became phenomenal successes, but most of the others failed to perform. The case deals with the question of why some extensions achieve great success while others fail miserably.
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