Methodology
Preliminary observation research revealed a key –and somewhat astounding- insight that Kotex buyers are not restricted to merely the older, more mature women. In fact, Kotex’ customers come from a variety of ages and race, although only one gender stood out (we all know which!) Furthermore, through our in-depth interviews with customers, we noticed that the person who makes the decisions vary from time to time, depending on the needs at that point of time. Therefore, customer segments are determined based on psychographic assessments of consumers’ buying habits and behaviors, which we feel would give us a more distinctive and targeted understanding of Kotex’ customers.
Our primary research findings revealed 3 main customer segments – The “Caregivers”, “Independent stockpilers”, as well as the “Urgent needs” group. Earnings per segment were then estimated primarily from our survey findings in assignment 2B, and supported by in-depth interviews, diary and focus group interviews with some of our customers in assignment 2A.
Description
The largest segment and one of the most important decision-makers of sanitary protection in every household, the Caregivers steal the limelight with their love and tender care for their loved ones. They are the primary decision makers of the family when it comes to sanitary protection, and always have a multitude of factors to consider in their minds before making the purchase – reminds us dearly of our caring mothers! Price, comfort, or aesthetic attributes are certainly not independent factors for these Caregivers.
Relationship with Kotex: Best friendship
Relationship with KotexBest friendship – Caregivers have a long-term voluntary relationship with Kotex, the endurance of which is ensured through trust and continuous provision of positive rewards such as comfort and positive responses from loved ones Implication for KotexThe Caregivers are most loyal to Kotex because they need to make careful decisions that would affect the household, resulting in less brand switching. However, in order to keep them loyal and even make them brand ambassadors, Kotex needs to ensure consistent improvement of product quality, especially in terms of functional attributes such as comfort and security.
Implication:
The Caregivers are most loyal to Kotex because they need to make careful decisions that would affect the household, resulting in less brand switching. However, in order to keep them loyal and even make them brand ambassadors, Kotex needs to ensure consistent improvement of product quality, especially in terms of functional attributes such as comfort and security.
Caregivers: 58%
Description
The Independent Stockpilers are, as the name reveals, independent women who probably live alone or are married without children who have gone through puberty in their household. This group of women make up an almost equal portion of Kotex’ customers as compared to Caregivers, but contribute half as much to the sales in 2013. This is because they buy primarily for their own use. They still, however, make up a substantial portion of Kotex’ sales because of their habit of stockpiling for future use as they tend to prefer reducing the frequency of going to the store to purchase. They are also more price conscious because they buy for their own use, as compared to Caregivers who need to consider the needs and preferences of their loved ones. The Independent Stockpilers are also likely to buy Kotex when there are incentives to do so, such as convenience or sales promotions, hence justifying buying in bulk.
Relationship with Kotex: Compartmentalized Friendship
Similar to the Caregivers, the Independent Stockpilers have an enduring relationship with their brand of sanitary protection, but have a lower intimacy with the brand because of price and convenience. It is easier for them to switch brands, because they do not have to be accountable to others.
Implication:
As much as comfort and style matters, the Independent Stockpilers make up a substantial portion of Kotex sales, enough to warrant the need to keep up with sales promotions to keep this group of stockpilers committed to buying in larger quantities. The distribution of its products also matters, as convenience and speed is important to these busy stockpilers.
Independent Stockpilers: 28%
Description
Taking up the smallest proportion of sales and fraction of customer, the Urgent Needs segment is, however, a growth potential. This group of customers is characterized by women who need a quick fix, especially when the time has come and nature calls – “Oops” it’s an emergency! Another group of Urgent Needs customers are characterized by women who buy whenever they need. There is a noticeable gap in the market to cater for this specialized group, which the Kotex Team is interested to look into. This segment of customers are more likely than not to be very price sensitive, and their purchase decision guided by smaller package sizes.
Relationship with Kotex: Casual Friendship
Urgent Needs Kotex users are likely to be sporadic in their engagement, as they seek non-committal relationship with the brand. They pursue a non-threatening, low in intimacy relationship characterized by expectations of low reciprocity of quality or comfort.
Implication:
There is an opportunity for Kotex to fill up the market gap by catering to the Urgent Needs segment. A differentiated price point, an aesthetically pleasing yet not easily noticeable packaging would likely make the difference in capturing this market segment.
Urgent Needs: 8%
Earnings
We derived the NOPAT figures by obtaining figures from Kimberly Clark’s 2013 annual report as such:
Cycle Buyers: 6%
Description
Making up the smallest proportion of Kotex sales is the Cycle Buyer segment. These customers are characterized by women who buy pads for their period whenever they feel that it is coming or their period has come, and they do not have the habit of stocking up at home. They are also likely to be in their early 20s to late 20s, as they are financially independent and likely to make personal purchases on their own. They are also usually caught off-guard when their period comes, hence they are unlikely to buy large packs as it will not fit well in their bags. As they do not stockpile, they are unlikely to purchase large packs of discounted pads, but rather regular-sized packs that are sufficient to tide them over for that month.
Relationship with Kotex: Compartmentalized Friendship
Cycle buyers look out for pads that suit their needs the best at that point in time. They are brand-conscious as they know the differences between the products that various brands offer. This is likely because they have tried out different brands before, as their brand usage is dependent on which brands are available at their time of need. Hence their friendship with the brand is situational-based, and they may move on to buy another brand that suits their needs for that month that they have tried previously.
Implication:
Distribution, price, and product attributes is important to this customer segment, as they place more emphasis on needs satisfaction and availability of brand.
