Executive Summary
Reckitt Benckiser Group PLC has successfully introduced and marketed the Dettol with Oud product as a localized soap with medical benefits to users. The company has used competitive advantage strategies such as high quality, customization, and a well-established reputation through endorsements medical professional bodies. Despite having been in the market for more than ten years, the company still faces stiff competition from Uniliver, Pz Cussons, Procter and Gamble, and other local brands.
These companies have a similar catchment area. To survive the competition and penetrate the UAE market further, the company has concentrated its marketing strategies to capture all market segments since the product can be used by everyone daily. From the PESTEL analysis, the political, economic, technological, social, and legal factors are positively skewed to the advantage of the company. The SWOT analysis reveals the strengths of the company and the Dettol with Oud products such as customization, brand acceptance, unique market as a result of series of corporate social responsibility initiatives, which doubled up as self-marketing strategies.
Since Reckitt Benckiser Group PLC intends to initiate a critical focus on the most reachable market and strategically increase ambiance without appearing as a copy cat of the main competitors, the recommendation of engaging other distribution networks through partnerships, improved product packaging, and localized advertisements are expected to facilitate market penetration into the rural regions in the UAE. To achieve this, the company may position its Dettol product as the first of its kind in the UAE market to use the Oud as one of the major ingredients. This will fit into the perception map of increasing sales and further market penetration.
Introduction
The Reckitt Benckiser Group PLC is a global company that retails several products in the hygiene, health, and home product segment. The company has its headquarters in Britain but has penetrated different markets such as the UAE. In the case of this assignment, the report will concentrate on the company’s Dettol with Oud product that has been customized to fit in the UAE market. This product was chosen because it is relatively new in the UAE market but has become an instant success.
This marketing audit plan aims to carry out a comprehensive situational analysis of the Dettol with Oud products in the UAE market. The report will be based on secondary research that summarizes the performance of the product in the region. However, the findings in the report will be limited to reports and existing literature about the company and the product within the UAE.
Context and Environment for the Reckitt Benckiser Group PLC
PESTLE Analysis
Political Environment
In the UAE, the government regulations, taxation strategies, directives, and norms of leadership are highly flexible for business. The UAE is one of the most promising business places with remarkable expansion in the corporate world. The Reckitt Benckiser Group has taken advantage of the favorable US economic condition to expand its market niche (Roberts 2005). This trend is rated third with a weighted score of 0.2. The statistic for this trend is 0.6/2.25 multiplied by 100, which is equal to 26.7%.
Economic Environment
Through combining the increase in government expenditure with vibrant tourism, transport, and trade, the outcome is a favorable environment for trade in the UAE. An increase in government expenditure implies that there is more money in circulation and people can afford to buy the Dettol with Oud (Stokes 2011). This trend is rated first with a weighted score of 0.3. The statistic for this trend is 0.3/2.25 multiplied by 100%, which is equal to 11.9%.
Social Environment
Heritage and culture are valued by the targeted market. The United Arab Emirates is a diverse, multi-ethnic, and multicultural society, which makes it a perfect destination for the customized Dettol with Oud product (Jin, Suh, & Donavan, 2008). The rising need for medical soaps in the UAE means that demand for the Dettol with Oud is on the rise. Considering that Islam is the main religion in the UAE, the product is expected to register success. The nature of Islamic religion requires Muslims to be clean, which is why the customized and medicated Dettol with Oud will fit well in the region. This trend is rated second with a score of 0.25. The statistic for this trend is 0.5/2.25 multiplied by 100, which is equal to 22.2%.
Technological Environment
The advent of computer scanners at retail checkout counters in the UAE means that the supply of the Dettol with Oud products is accompanied by barcodes. This has ensured strategic product positioning in all the supermarkets and retail stores in the region (McKinney 2005). This trend is rated fourth with a weighted score of 0.15. The statistic for this trend is 0.6/2.25 multiplied by 100, which is 26.7%.
Legal environment
As a legal requirement, companies in the UAE are expected by the regulatory authorities to be tax compliant (Liu, Liao, & Peng 2005). The Reckitt Benckiser Group PLC complies with the above laws. This has created an easy environment for the Dettol with Oud products. This trend is ranked fifth with a weighted score of 0.05. The statistic for this trend is 0.25/2.25 multiplied by 100, which is equal to 11.1%.
From the Pestle analysis, it is apparent that Reckitt Benckiser Group PLC has a high chance of penetration and expansion of the market since all the values derived are positive. This means that the market forces will positively influence the Dettol with Oud product penetration in the UAE market.
Organization Overview
Mission Statement Analysis
The mission of Reckitt Benckiser Group PLC is to attract and maintain customers through the provision of convenience and high-quality medical Dettol soap with Oud that surpass the expectation of the clients (Reckitt Benckiser Group PLC 2015).
The experienced team at Reckitt Benckiser Group PLC, excellent locality, special and distinctive services, as well as strategic management team, has been critical in the business’ undertakings (Ira 2002). The marketing environment in the UAE for the Reckitt Benckiser Group PLC has been amenable to the affordable Dettol with Oud product. Product marketing has also been rolled out through social media, local media, and the company website. In the next five years, the company targets to increase product visibility, distribution, and diversification in the UAE market.
Performance Over the Years
For over a decade, Reckitt Benckiser Group PLC asserted and expanded its position as a major global player in the hygiene, health, and home product segment market in fulfillment of its mission. The company successfully used flexible sourcing, retail distribution, and product-focused differentiation to survive the impact of competition (Harris & Dennis 2007). As a result, the annual sales increased by 40% from the year 2006 to the year 2015, that is, growth in annual sales from $155 million to $420 million (Reckitt Benckiser Group PLC 2015).
Reckitt Benckiser Group PLC’s Marketing Strategies
Reckitt Benckiser Group PLC utilized retail distribution in the past to further expand its presence in the UAE market and beyond. Reckitt Benckiser Group PLC’s scope of operations was characterized by retailing different products to target men, women, and children market segments. For instance, Reckitt Benckiser Group PLC applied a series of grand strategies to expose its Dettol with Oud product in the UAE market as the most competitive brand (Farris, Bendle, Pfeifer, & Rebstein, 2010).
Marketing Objectives
As a prerequisite for sustainable organization performance, the strategic issues that Reckitt Benckiser Group PLC is currently facing pivot around the most appropriate market that the company should focus on or neglect to survive competition (Reckitt Benckiser Group PLC 2015). Under this strategic issue, Reckitt Benckiser Group PLC intends to initiate a critical focus on the most reachable market, sustain the stratified UAE market and the best strategies of increasing ambiance without appearing as a copy cat of the main competitors (Farooq & Jan 2012).
Corporate Social Responsibility
Reckitt Benckiser Group PLC strives to factor in the three Ps management strategies comprising of the Planet, Profit, and People in its CSR activities to market the Dettol with Oud in the UAE (Reckitt Benckiser Group PLC 2015). For instance, the company’s annual healthy living day and other health initiatives are part of the company’s management philosophy meant to ‘create shared value’ between the business and customers.
During the annual healthy living day, the company gets the opportunity to market the Dettol with Oud as a product that fights germs associated with many illnesses. This initiative has been very effective in the growth of the client base and enhancement of customer loyalty for the Dettol with Oud product. However, there is a need to organize the event at a localized level in different regions to reach more customers.
Market Profiling
Key Target Market
The customers for the Dettol with Oud product fall in the youthful, middle-aged, and old customer segments besides health institutions across the UAE. These groups are spread throughout the UAE and are active users of medicated soaps. To remain relevant, the company has established a unique way of marketing the Dettol product to these customer segments through tailored optometry and active television marketing. These customers need high quality and affordable medicated soap products for daily use that guarantees fighting germs (Cone 2011).
Major Competitors and Characteristics
The UAE hygiene, health, and home product industry have experienced steady growth as more customers embrace renowned brands from Uniliver, Pz Cussons, Procter and Gamble, and other local brands. Specifically, Pz Cussons has a market share of 15% with the most affordable product in the market. This is followed by Uniliver with a market share of 11% as a result of selling multiple products in the market.
The third position is held by Reckitt Benckiser Group PLC at 9% while the fourth position is held by Procter and Gamble at 7% through concentration on the children market segment. The promotional services adopted by these companies have spurred the growth of their products in the UAE market (Reckitt Benckiser Group PLC 2015). Based on the annual growth and market share estimation at 10%, the incumbents are positioned to benefit in the future because the industry is highly attractive.
Key Success Factors
The first success factor in the UAE market for medicated soaps is the establishment of a brand image that enables a company to attract customers with less effort as opposed to most of its less established rivals. The Reckitt Benckiser Group PLC has also been active in conducting market research to ascertain customer thoughts and changing demands (Bythe 2006). This has given the Reckitt Benckiser Group PLC sufficient time to learn from its weaknesses and develop long-term strategies that will anchor it through the future of the market.
SWOT
Strengths
Reckitt Benckiser Group PLC has several resources that have contributed to its success in the global market over the years. To ensure business sustainability, Reckitt Benckiser Group PLC has concentrated the focused strategy through a clear definition and targeting of the specific market segment. Besides, Reckitt Benckiser Group PLC offers the most competitive prices for its quality Dettol with Oud product. The company’s product differentiation through innovation and product reliability has been successful in ensuring that its Dettol with Oud brand remains unique and visible in the market (Cone 2011).
Weaknesses
The company has more presence in urban centers than in the rural regions in the UAE. Specifically, unlike its main competitors, the Reckitt Benckiser Group PLC has few partnership distribution stores beyond the major cities in the UAE. Thus, the Reckitt Benckiser Group PLC does not enjoy the substantive demand in the local market as its customer catchment area is restricted to the urban centers (Blythe 2006).
Threats
Despite the success of the marketing strategies, Dettol with Oud is threatened by its competitors with a more or less similar approach in doing business within the UAE market. For instance, Uniliver, Pz Cussons, and Procter and Gamble threaten to reverse the gains that Reckitt Benckiser Group PLC has made in the market (Al-Jenabi 2008).
Opportunities
The company has an opportunity of sustaining its current market through effective supply chain network, middle-income customer segment targeting, and attractive display in the stores. Its value chain can also be modified to commence with the development of products through own factories, autonomous producers, and partnerships with licensed distributors (Al-Jenabi 2008). These factors will reverse the current weakness into strength since the partners will help the company penetrate the rural market.
Testing the Marketing Objectives
Since Reckitt Benckiser Group PLC intends to initiate a critical focus on the most reachable market, the strategic partnership with distributors will guarantee increased market visibility for the Dettol with Oud product and encroach into the markets of its competitors. With the company’s value proportion of quality and customized medicated product in the local UAE market, it is easy to achieve the above marketing objectives. However, the company is faced with the issue of how to equally customize marketing strategies such as language and media platforms to reach clients in urban and rural regions in the expansive UAE market.
Positioning and Perception Map
How the Company Wants to be Perceived
The company wants the customized Dettol with Oud product to be perceived as a local product made for the locals by the locals as compared to the substitute products that do not share the local Oud culture (Dagnino & Rocco 2009). The local market has embraced the Dettol with Oud product as a local brand that is of high quality and relatively affordable as compared to the products of some it competitors as presented in the perceptual map and positioning map below.
Recommendations
Positioning strategy
This Dettol with Oud product can position as the first of its kind in the UAE market to use the Oud as one of the major ingredients. As the first player for this kind of medicated soap, it is easy to project a steady market share gain within six months for the proposed marketing approach. Also, a series of market research on customer demands will be carried periodically to improve on satisfaction, desires, and expansion to new market territories (Al-Jenabi 2008).
Perceptual map
The current perceptual map is to make sales across the major towns in the UAE. Specifically, the targeted sale will be informed by research and a thorough review of the existing medicated soap products offered by competitors. The long term perceptual map will be to roll out the Dettol with Oud product to other regions and make sales to a tune of six times the current sales projection (Cone 2011).
Conclusion
Reckitt Benckiser Group PLC has successfully introduced the Dettol with Oud product as a customized medical soap in the UAE market. To survive the competition and penetrate the UAE market further, the company has concentrated its marketing strategies to capture all market segments, since the product can be used by everyone daily. The established brand image has enabled the Reckitt Benckiser Group PLC to cut on its cost and get increased levels of profitability.
To survive the force of competition, the company has a series of product promotional initiatives and endorsements by medical professional bodies in the UAE. The company should introduce a strategic positioning and perception map to reverse the threats of stiff competition. The positioning statement will identify the company as the first in the market to introduce a medicated soap that incorporates the Oud as a major ingredient. As a result, the locals will perceive the product as localized and increase their purchase of the soap.
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