Marketing Blog – Boots Vs Superdrug

This blog will focus on the marketing mix of Superdrug and Boots which will be compared against each other. These two companies are very similar in many ways as these are both health and beauty retailers on the British high street, however, Boots was originally created as a pharmacy chain in 1849 and developed into having a larger product line and Superdrug was just created as a health and beauty chain in 1964.

These companies are similar they both have a loyalty points card programme ‘Boots Advantage Card’ and Superdrug’s ‘Health & Beauty Card’ and an online websites, however, Boots does have its own pharmacy in their stores and have separate opticians which offer laser eye surgery and hearing care whereas Superdrug do not have a pharmacy within their stores or separate opticians but within their larger stores they have ‘The Perfume Shop’ inside and eyebrow waxing available within stores. These companies will have different target markets on certain products and by customer perception of the businesses as I believe that Boots target an older generation who are well off whereas Superdrug targets a younger generation.

These companies do have some differences within their marketing mix which will be discussed throughout this blog post. The marketing mix involves seven element; product, place, price, promotion, people, physical evidence and process which all need to be completed to have a successful business. This blog post will focus on the first four elements of the marketing mix; product, place, price and promotion and will discuss brand loyalty and acknowledgement.

Product
The product could be seen as the most important part of the marketing mix for a company as with no products then there would be no company. Boots and Superdrug will both have a product mix which will cover the width and depth of products, the width is the number of product lines and depth is how many products they offer in each line of products. Boots and Superdrug both have a wide range of products within their stores and online website.

Boots products range includes;

·         Pharmacy and Health

·         Fragrance

·         Beauty

·         Mother and Baby

·         Men’s

·         Toiletries

·         Electrical

·         Photo

·         Opticians

·         Toys

·         Gifts

Superdrug’s product range includes;

·         Make-up

·         Skin

·         Fragrance

·         Mother and Baby

·         Hair

·         Men’s

·         Toiletries

·         Electrical

·         Health

·         Opticians

Each product goes through the product life cycle and each product will only be successful through the marketing mix being successful. Both companies have their own brand pro

ducts which will go through their own product life cycle, they will start with introduction of the product, for example the introduction of own brand beauty line, at this stage the product will start off with slow sales until gradually moving into the growth stage, the product sales will grow and the products will have more recognition, the products will then move into the maturity stage where this is when sales are at their highest and the product is well known, this is the best stage for the product to stay in unless your product reaches the end of the product life cycle and goes into the decline stage where the products sales are low and the company may eventually have to take the product off the shelves.  

Even before the product goes through the product life cycle there is a product development process which needs to happen before introduction. This is the whole process of creating the product to ensure it doesn’t reach the decline stage.

Product development –

1.    New product development strategy

2.    Idea Generation

3.    Screening and Evaluation

4.    Business Analysis

5.    Development

6.    Test Marketing

7.    Commercialisation  

This process is extremely important before entering a product into the market which both Boots and Superdrug would have to go through before introducing their own brand products into their market. As both companies sell other brands they would have to go through some of these stages to ensure that their aimed customers would purchase the items and would gain a profit from such products.

A huge part of a product succeeding in the competitive market is brand name, products can be pushed into decline for not having the correct name for the product. Boots own brand product is simply named ‘Boots’ and under each product line it changes slightly such as skincare ‘Boots Essentials’ and mother and baby ‘Boots Baby’ Boots also have their own makeup brand ‘No7’ which is a huge success for the company. Superdrug’s has its own brand of premium skin care called ‘B’ which offers skin care and make-up which was launched in 2013, there other own brand products would be recognised with a star shape on the product which is products such as false eyelashes and sun care which is cruelty free.

When Boots first opened in 1849 as a pharmacy the medicines and prescriptions where extremely expensive but unlike anywhere else at the time the founder, John Boot, was able to get them straight from the manufacturer and sell them on for an affordable price. (Boots.com, 2016)

Place
Place is where the company locates their stores which could be a huge factor in the success or failure of a business which affects the whole process of the marketing mix. Boots was originally founded in Nottingham, United Kingdom 167 years ago, this was clearly a successful location for the business as it’s developed into over 2500 stores within the high street, shopping centres and airport terminals within the UK and Ireland making it the largest health and beauty retailer in the UK (Boots.com, 2016). With the growth of Boots the reputation grew and the company became better known. Superdrug was founded in 1964 in London, United Kingdom, within the four years there was a total of three stores within Putney, Croydon and Streatham, by 1970 there was over 40 stores with rapid growth and today there are over 800 store within the United Kingdom making them the second health and beauty retailer in the UK proving to be a success for the company.

There would be many factors which affect the location choice such as customers, would the location have many passing customers or would it attract customers to come to your location or is it convenient for customers, staff, the location would need to be able to supply the correct amount of staff for the store to open and run smoothly with staff with the correct skills needed, cost, is the business going to be able to afford the premises with still making a profit and being in a prime location. Other factors such as parking could affect as customers would need to be able to park near your store, also competition as the business would need to decide if they wanted to be around many competitors or not and stock rooms, as they would need to ensure they have a big enough stock room to hold all stock to get it out on the shelves on time (Bbc.co.uk, 2016). Both Boots and Superdrug have locations in Glasgow’s high street with a Boots store within Buchanan Galleries and St. Enoch Centre and a Superdrug store on Argyle Street and Sauchiehall Street, the stores are quite close to one another which shows that they strategically choose those locations to have a competitive advantage over each other.

The more locations that the company has the more the company would have brand recognition and gain a higher profit margin leading to a very successful business.

Price
The price of products would be set after the product development process as you need to have your product before you can set a price and this is the only element of the marketing mix that produces cash.

There are many different pricing strategies;

• ·         Price Skimming – setting price high at introduction then lowering the price as it goes through the product life cycle.
• ·         Special Event Pricing – prices put on promotion during different times of the year or if there is an event on.
• ·         Penetration Pricing – price is set low at introduction then once there is customer loyalty price is raised.
• ·         Premium Pricing – prices always set high to target a certain type of customer.
• ·         Economy Pricing – prices always set low to keep competitive advantage.
• ·         Promotional Pricing – price set on different items to sell the products such as 3 for 2, BOGOF etc.

The type of pricing strategy used will affect the success of the business as the price needs to be right for consumers to buy your product. The company needs to decide what kind of price they will sell at, if they have a luxury product then they will use prestige/premium pricing to target the right customers whereas a supermarket which sells a low prices all year round would use economy pricing. Boots and Superdrug would use many different pricing strategies such as penetration pricing which they would use on products such as makeup, economy pricing on products such as own brand which they keep low all year round, they would also use special event pricing for around holidays such as Christmas, Halloween, Summer holidays etc, this would encourage more customers to come into their stores and increase sales and profits at these times of the year, they would also use promotional pricing as they would use this to keep customers loyal and encourage customers to buy more products such as 3 for 2 or certain makeup brands and premium pricing on their more higher end products such as fragrance like Chanel or Gucci which would stay high all year round.

The company could go into the decline stage of the product life cycle before reaching growth or maturity if the price was set too high customers might not think it’s worth it or too low and the customer don’t buy as they think it’s not high quality so setting the price correctly is extremely important to the success of the product.  Companies could struggle with price strategies as they could sell a brand which wants their product to be sold a certain price to keep up a prestige image of the product which could lead to low profit margins with that certain product yet the company keeps the product to keep the prestige image within the business.

Promotion
This is every way the company decides to promote their product to gain brand recognition and brand loyalty which they can do through the promotional mix. Most people believe that promotion is always just about advertising the product but it’s not it’s so much more. They promote products by advertising, promotional deals, flash sales, loyalty points, coupons, competitions, price match promise, holiday promotions and email. Customers can also promote your products as they can change people’s opinions and give your business good or bad word of mouth. (Sparkpay.com, 2016)  

Advertisement is extremely important as this is how consumers find out about your product and how your brand becomes well known. The most popular ways to advertise products includes TV adverts, radio, social media/internet, posters/leaflets, newspapers, sponsorships and many companies use celebrity endorsements. Boots use many different advertisements to gain brand recognition and customer loyalty, they have many TV adverts on popular channels and have been a long time sponsor for ‘This Morning’, they also use social media to advertise products targeting young customers they have a following on ‘Instagram’ of over 370 thousand people and ‘YouTube’ with over 15 thousand subscribers, Boots is also well known for different campaigns such as using real women in adverts so customers can relate. Superdrug also uses TV adverts to advertise however are not well known for any sponsors of TV shows, Superdrug also uses social media and their ‘Instagram’ following reaching over 420 thousand people and doing competitions on Instagram promoting products, Superdrug have celebrity collaborations to promote products with YouTube sensation Zoella who has over 10 million YouTube subscribers.

Other types of promotion methods that are used from different companies are promotional deals such as BOGOF and 3 for 2, Boots and Superdrug both use these promotional deals on certain makeup brands such as ‘Rimmel London’ and ‘Maybelline’, health and beauty and around Christmas time. Also around Christmas both companies bring out gift sets on perfume which promote all the different perfume they sell encouraging consumers to buy and recommend these products. Both Boots and Superdrug use loyalty points which encourages customers to spend more money within the store to gain more points, Boots also send promotional points deals to your house based on your shopping habits to encourage going into the store to use them whereas Superdrug do not send out these points deals. Superdrug try and sell customers certain deals at the till to encourage impulse buying and both companies use flash sales to promote such as ‘Black Friday’ just before Christmas sales start. Both companies use their online website to promote products as they will offer different deals and promotions online that you may not get in store, also buy using a free delivery to store promotes products as you have to collect the product within the store and may lead to more purchases.

Coupons, competitions and price match promise are used mainly within supermarket stores to encourage high amounts of spending however, Boots do offer coupon deals once you have purchased your products at the till for money off their own make-up and beauty brand ‘No7’. Boots do not use celebrity endorsements to promote their own products however brands within their stores use celebrities with make-up brands such as Rimmel London, Maybelline, L’Oreal and Max Factor. Many companies stay away from celebrity endorsements as celebrities can have gain a bad reputation suddenly after doing something and it could damage the products and the brand could gain bad word of mouth. Companies will use email subscriptions to promote products and target customers to buy certain products and target people at different times of the year to encourage higher sales, this is a good way to get customers into the store on onto the online website.

References

Boots.com. (2016). History of Boots making medicines for more than 160 years - Boots. [online] Available at: http://www.boots.com/en/The-history-of-Boots-making-medicines-for-over-160-years_1133893/ [Accessed 18 Nov. 2016]

Sparkpay.com. (2016). The Top 10 Most Popular Types of Sales Promotions. [online] Available at: https://www.sparkpay.com/the-top-10-most-popular-types-of-sales-promotions [Accessed 18 Nov. 2016]

Bbc.co.uk. (2016). BBC - GCSE Bitesize: The importance of location. [online] Available at: http://www.bbc.co.uk/schools/gcsebitesize/business/environment/alocalcommunityrev1.shtml [Accessed 18 Nov. 2016]