Scope is a mouthwash product of Proctor & Gamble. This product positions itself as a mint-tasting mouth washer that reduces bad breath. Holding 32% of market share, Scope has always been considered as a Canadian market leader. The competitors in the sphere are Listerine, Listermint, Plax, etc. Scope has been sure in its position at the Canadian market until Plax has presented its new product and gained 10% share of the mouthwash market. One of the main dangers Scope feels from Plax is that it has decided to occupy an absolutely new niche.
Problem definition
Scope positions itself as the one which has two main benefits, it offers its customer fresh breath and germs killing. Having been working for many years in this sphere, Scope was shaken by Plax who has positioned itself around an absolutely new benefit, it promises its customers to fight with plague. One more danger is that other competitors in the sphere have decided to promote the same benefit. Thus, the company should develop the strategy for ensuring that the product is going to be profitable within the mentioned threats and prepare a marketing plan for mouthwash business in Proctor & Gamble for the nearest three years.
Problem justification
To justify the problem, some research has been conducted. Having many different competitors, Plax is considered to be the most dangerous one as it offers a new product and can substitute Score in its properties. One of the main statements is that Plax has managed to gain 10% share within a year and continues to grow. The research has shown that 40% of people use mouthwash as a part of their hygiene (e.g. germs killing, mouth cleaning, plague removing, making teeth and gums healthier). So, it is important for the customer to keep hygiene in mouth, but do not have fresh breath. This proves that Plax may become a serious competitor in the next years.
Furthermore, have conducted a research among all the customers of mouthwash products, it has been identified that people rate Plax as more than average in the following attributes, ‘removes plaque’, ‘healthier teeth and gums’, and ‘recommended by doctors/dentists’. Plax has received one negative feedback in the relation to the reduction of bad breath. Scope has been affected by the same research at none of the attributes was ranked as more than average; at the same time people rated negatively Scope’s ability to kill germs, make teeth and germs healthier, and remove plaque. Therefore, the general opinion of people who might have never used any mouthwash products about Scope is lower than about Plax.
The brand users of Plax and Scope have also considered their mouthwashes from the same perspectives. Thus, it is possible to understand why people buy the mouthwashes of the definite brand. It has been concluded that people buy Scope to reduce bad breath. Plax is bought for the doctors’ recommendations, it makes teeth and gums healthier, and removes plaque. It should be mentioned that those who use Listerine buy it in a number of reasons, because it reduces bad breath, kills germs, removes plague, makes teeth and gums healthier, is considered to be good for preventing colds and is recommended by the doctors. So, Scope has the heights to reach and for its purpose it should choose one of the alternatives mentioned below.
Alternative Courses of Action
Procter & Gamble has an opportunity which strategy to choose as it has at least three main alternatives. First, the company may leave everything as it is and watch what is going to be with the market share. Second, the company may develop the product and change it according to the new tendencies. Third, the company can extend the line and offer an absolutely new product, have left classic Scope as a mint-tasting mouth washer that reduces bad breath.
Discussion Criteria
The alternatives mentioned above should be discussed on the basis of two main criteria, qualitative and quantitative. Quantitative criteria includes the level of market share, its loss/gain or other influences, different kinds of risks, and the level of predicted profit. Referencing to the qualitative issues, it is important to check the predicted level of customer satisfaction, brand awareness and target group. All these criteria should be referred to within each of the alternatives to make sure that the decision is correct. It should be mentioned that seven teams are going to be involved in the discussion and analysis of the alternatives.
Evaluating Alternatives
Having chosen the alternative of non-interference and leaving the product as it is without any changes in the strategic marketing, the company may be sure in failure experience any financial risks. The implementation of either of other alternatives requires financial expenses on equipment and raw materials. If Scope remains as it is, and the company just observes the situation at the market, nothing is going to change. Customers’ satisfaction with the product is going to remain, as buying Scope for removing bad breath customers will have this opportunity. But, there is a danger that the offers of the wider range of options with other brands may reduce the number of Scope buyers. Furthermore, people are already aware of the brand and they should not be offered a new advertising campaign for familiarizing them with a novelty. Nevertheless, there are a lot of disadvantages within this alternative. The analysis of the mouthwash market shows that Procter & Gamble is going to lose its share in the favor of competitors. This is going to result in profit reduction. The best development of the scenario predicts that profit may remain as it is.
If the company chooses the development of a new product by means of implementing new attributes, like plaque removal and adding new flavors, the company is going to benefit in many reasons. First of all, the customer satisfaction may increase as being offered the classic options they are going to get additional benefits. Second, the target market is going to increase as new opportunities are going to be offered. Third, having implemented the same attributes as those which the competitors have, Scope may remain at the head of the competition. The brand awareness may increase as a result of increasing the properties of the product. Though, the disadvantages are numerous as the change of the attributes in Scope may be considered as classic product cannibalization from 2 up to 9%. The income risks are considered to be middle and in some cases even high. A changed product may confuse the customer, who will switch to another brand.
The last alternative which has been discussed is the extension of the line by means of creating a new product which is going to respond to the innovative ideas in the mouthwash industry. The advantages of this alternative are as follows, the product is going to have a new identity and customers like when new products of the well-known brand appear at the market. Moreover, this alternative will help to create a more focused target group. Still, the disadvantages should also be counted. A new product may lose market share as a variant of cannibalization, the customers may be confused and refuse from buying a new item, the line extension requires high investments and involves high risks.
Conclusions and Recommendations
Having considered all three alternatives, their advantages and disadvantages, it may be concluded that line extension is the best way out for Scope. This option will help Scope remain the market leader and have a strong strategy against competitors. Only this option allows Scope to target new customers that is considered one of the main ideas for increasing the market share. As a result, the profitability is going to increase. Except for the advantages mentioned above, Scope is going to develop, it will offer its loyal customers something new along with the remaining of a classic product, and some switchers will have an opportunity to pay more attention to this brand and choose it as their preferred. It should be mentioned that the new advertising campaign may be inserted in the previous one to make customers understand that this new product has some additional attributes, but still leaves its initial qualities.