Page 21 - DMGT510_SERVICES_MARKETING

Services Marketing

Notes So while Lakme salons not only stock a range of products that go under its brand name, it
also showcases part of the HLL portfolio. In fact, it is this lifestyle change and the need to
‘look good,’ that has motivated Chennai-based CavinKare to set up a group company –
Trends in Vogue. The company is opening three separate chains, catering to assorted wallet
sizes that are all targeted at 20 to 35 years old. At the lower end is Fyne Cut, a budget salon
for men. Positioned as an ‘amazing value for money’ offering, it competes with the friendly
neighbourhood barber.
Green Trends will have a range of men’s and women’s salons aimed at the middle class.
The recently launched Limelite is the premium brand targeting upper crust men, women
and kids. To ensure that it offers ‘an international standard beauty care’, CavinKare has tied
up with German hair major Wella of Germany and Beaubelle of Switzerland.
Says Sanjay Gupta, general manager, Trends in Vogue, “We realized that there was a need
gap in the grooming industry. We use various brands of products at these salons, including
those that do not belong to us. The objective is to give the consumer a service suitable for
him. “That’s why even HLL is bonding with consumers through the Sunsilk salons.” The
objective is to build the event and the association of giving customized answers to Sunsilk
users. Consumers are moving from product to experience,” says HLL’s Shivakumar.
He denies that his company is making yet another attempt to bond with consumers, but
industry experts say that HLL would never invest in anything that didn’t have a long term
potential. So to woo customers, on offer are free haircuts and beauty treatments by Habib
and beauty specialist Samantha Kochhar. Marico’s Kaya trip is more an attempt to lessen its
reliance on cash cows Saffola and Parachute. Over the years, the brands, which have
gained market share, have also been milked dry with various extensions, many of which
have failed.
In fact, unlike other players where the service foray has synergies with their brand portfolio,
Kaya is absolutely out of sync with Marico’s platter. For Wella, it has been a year of
‘reinventing the wheel’ according to Sebastian Zachariah, head, creatives and
communication at European Haircosmetics, the wholly owned subsidiary of Wella AG.
After calling off its two-year-old marketing tie-up with J L Morrison of Nivea fame in
February, 2003, it is looking at the salon business with enthusiasm.
Wella, which has no retail division and sells only through the parlour route, has plans to
open 150 salons by this fiscal end. “We have to evolve given the scenario. That’s the only
way to penetrate the market,” says Zachariah. “For us, it is a perfect extension,” says
Vismay Sharma, general manager, professional products division at L’Oreal. Having tied
up with parlours three years ago to call them Prestige outlets, its recent foray into HFX is
a completely new initiative. “Salons as a channel are by far the most interesting,” he adds.

All the players echo similar views. But it could be slightly unfamiliar territory. But for
LBS, its strength might be that it was in the beauty business for over a quarter of a century,
tracking the aspiring Indian woman; its weakness could be that it was foraying into
experience and services which were intangible and difficult to measure for quality and for
maintaining consistency.
Questions
1. What advantages did Lakme Beauty Salons start with and what were its inherent
drawbacks?
2. Analyze the beauty industry completely, its opportunities and competition.
3. Enumerate the different rationale for Lever to extend its product brand to services.
Contd...

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