CEO Challenge Phase 1 Brand Manager Challenge

BRAND MANAGER CHALLENGE BRIEF Feb. 24

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Copyright © 2014 Procter & Gamble Gulf FZE ALL RIGHTS RESERVED This CEO Challenge Brief contains which are created by/ and or for Procter & Gamble Gulf FZE and are protected under Copyright Laws and Treaties. Any unauthorized reprint or use of this material is strictly prohibited. No part of this CEO Challenge Brief may be reproduced or transmitted in any form or by any means, whether electronic or mechanical, including but not limited to photocopying, scanning, and any information storage and retrieval system without the express written permission of Procter & Gamble Gulf FZE.

Disclaimer:

All data presented in this document is fictional, and created for the purpose of the P&G CEO Challenge 2014.

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EXPECTED OUTCOME: 1) Submit solution to P&G on [email protected] by Mar 3rd, 2014 11:59 Jeddah, Saudi Arabia (GMT+3). 2) Base format is PPT but is not restricted to. (Be Creative!)

ALL ABOUT THE RULES: Winning Criteria There is no Right or Wrong Answer! In the Brand Manager Challenge Phase of the CEO Challenge, we would like you to have the chance of being a P&G marketer bringing to life your strategic thinking, and creative ideas. We will be assessing the team’s outcome, based on the following criteria:

Clear Logic Feasibility & Relevance Creativity Holistic Plan

30% 20% 20% 30%

Ground Rules: 1) Each team will compete fairly and uphold business ethics. Unfair and unethical acts will be noted and be grounds for disqualification. 2) Each team must send in deliverables by specified deadlines. Failure to do so will be subject to disqualification.

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CEO CHALLENGE 2014 HUGO Boss energise

CASE OBJECTIVE: You and your team are Brand Managers within the P&G Prestige division. You are tasked with responsibility launching Hugo Boss energise, a new product in the P&G Fine Fragrance business. You need to prepare for your meeting with the General Manager and present your launch plan for the Pakistan. You will need to determine the following for Pakistan: 1) Launch Timing & Pricing 2) Provide a description of your target consumer (where they shop, their interests). Include an overall description of your core target and then focus your time on understanding your prime prospects. 3) Marketing Plan and its expenses. Marketing plan should include the activities you plan to conduct during the first year, the budget required and how you will reach your awareness target. 4) Detailed Description of marketing ideas to target your prime prospects 5) Detailed Plan for YouTube Video Campaign

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BACKGROUND: Background Information on P&G: In the 19th century, William Procter and James Gamble immigrated to America and both settled down in Cincinnati. In 1837 the candle-maker Procter and the soap-producer Gamble founded a new enterprise: Procter & Gamble. Within less than 25 years, Procter & Gamble's sales revenues reached 1 Million USD. After 100 years, Procter & Gamble had expanded its product range to soaps, detergents, and paper products. Already at that ti me the marketing concept was based on competing brands not only outside the company but also within Procter & Gamble. Today, Procter & Gamble operates in the following categories: Fabric & Home Care, Baby Care, Family Care, Feminine Care, Beauty Care, Health Care, Snacks & Beverages. This includes leading brands such as Ariel, Pampers, Pantene, and… HUGO BOSS fragrances.

Background Information on P&G Prestige: P&G Prestige is a sub-division of Procter & Gamble covering mainly the fine fragrances products. Within the fine fragrance category P&G Prestige is honored as a strong partner with strong global brands and highly successful marketing strategies and concepts. The brand portfolio developed fast over the years and now takes top ranks on global bestseller lists.

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GENERAL INFORMATION ON FINE FRAGRENCES: Fine Fragrances is a category where functional product benefits do not really exist but it is more related to image. One needs to connect a brand with its target group via attitude and clearly defined brand characteristics, in order to build long-term loyalty. Fragrance is about creating dreams not selling functional benefits.

Background on HUGO Boss: The Hugo Boss Fashion House was founded in 1923 by Hugo Boss. It became a private limited company in 1948, and went public in 1985. This was the start of a very strong growth phase. In 1987, annual sales were approx 250 million $, and by 1990 this had already doubled. Gruppo Marzotti S.p.A acquired a majority stake in 1993. Procter & Gamble is the licensee for cosmetics & fragrances. The “World of Hugo Boss” consists of 3 brands:   

HUGO: urban, trendy, irreverent – “Your fragrance, your rules” BOSS: self-confident, stylish and mature. BALDESSARINI: the luxury brand from HUGO BOSS introduced in 2002.

Currently, the Hugo Boss brand portfolio is as follows:

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HUGO Equity: HUGO is all about doing things your own way. I t’s urban, trendy and irreverent. I t’s for people who live by their own rules, not others ’. Hence the brand selling line “your fragrance, your rules”. It draws its roots from the HUGO fashion which is all about dressing to express your own individuality.

HUGO Portfolio: HUGO BOSS has different fragrance for different consumers and to meet different needs. Within the HUGO brand 2 male fragrances are already in-market: HUGO Man launched in 1995 which is one of the success stories in the fragrance market and is still the cornerstone of the brand today. Dark Blue was launched in 1999. Fragrances is a news driven category and HUGO energise is the first HUGO male launch since Dark Blue, therefore it is planned to be a big, blockbuster launch with full support.

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THE HUGO energise LAUNCH: The Concept: HUGO energise brings to life the active side of HUGO! The concept is derived from the growing global trend of ‘feel your energy’ – the thirst for different, riskier, more exciting ways of expelling your energy. Attitude meets energy

“Move on your own term s”

Design Themes: Key design themes to ensure a truly holistic initiative:   

Energy – key to bring to life the Hugo energy in every element from bottle to copy to execution in-store. The Red color – men associate the bright red chosen for this initiative with speed and adrenalin. The Red line – used consistently throughout all consumer touchpoints, the red line is a key executional equity.

Design Elements: The design themes are translated throughout all design elements:

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Primary pack and outer carton

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Energising, spicy and woody. Blind test winner with consumers Fit to concept “energising” and “masculine”. Strong ‘Partner rating’ – good for gifting from women. Fragrance

Key Visual


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CONSUMER MARKET KNOWLEDGE (CMK): CMK Role and Responsibilities at P&G: 

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CMK is the voice of the world ’s consumers and shoppers, leveraging their needs and dreams to grow the brands they love. CMK inspire teams to maximize new and established brand projects by acting on the integrated knowledge of: o Consumer and shopper decision processes. o Market and retailer dynamics. o External influences. CMK is responsible for Targeting Work: o Identify segments and choose target group. Engage in target’s life. o o Confirm business potential. o Select Prime Prospects. CMK is responsible for all equity and design elements qualification such as: o Define the strategic equity with Marketing. o Qualify with consumers each element to create a HOLISTIC proposition (pack, fragrance, name, price, advertising)

What are the key elements to determine your CMK Plan? 1) Targeting: a. Core Target: 18-28 years old men, who are on the move and live life to the full. b. Prime Prospects: Within the overall core target we have identified a particular group of consumers who are an attractive target for this initiative- the prime prospects. These are male university students. c. Concept idea to be brought to life: The energetic side of HUGO – “move your own way” 2) Volume Forecast: a. Consumer research of the idea, pack and fragrance estimate that in year 1 the number of consumers globally that will buy the product is 4 million men. Past launches have shown that 60% of these consumers will buy the 75ml and 40% will buy the 125ml. The test was based on a price for the 125ml of $45.

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3) WHAT- The Price: a. Key Principles: i. 75 ml should be priced at 80% of the 125 ml. b. Consumer Test Results for price of 125ml: i. $45 is the tested price that would lead to 4 million consumers buying the product in year 1. The indices below show how purchases would increase / decrease dependent on price

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Consumer Price per bottle ($)

Purchase (index)

50 45 40 35

88 100 108 135


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MARKETING: The key mission of Marketing is to delight the consumers we serve so that they will choose and buy our brands. Our ultimate objective is to develop and build a brand in terms of profit, volume and share. Your Role and Responsibilities: You are the Pakistan Brand Manager for HUGO Fragrances and your task is to develop and propose an appropriate Marketing plan for the first 12 months of the launch for Pakistan, including: 

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Launch Timings: Start of shipments Pricing: energise should be positioned as a high value fragrance, which needs to be reflected also via the consumer price. Similar positioned competitors have prices of around $45 for a 125ml bottle, which you don ’t want to undercut. Further, going below this price could potentially hurt the whole Hugo Boss brand equity. Marketing Budget: You will need to work with your team to agree on your marketing budget, but you know from past experience you need $3 - 4 million for a good year 1 support plan including prime prospect targeting. Pakistan can spend 18% of the global marketing budget. Communication Plan: you need to develop a holistic communication plan for the launch of your new fine fragrance, which will allow you to achieve your awareness objectives. To this end, you need use the most appropriate combination of media tools (see below tool box) in order to launch your fragrance. Awareness: especially in the first year, it is important to create brand awareness rather quickly in order to build up market share. Objective of your plan is to reach 70% awareness rate within your target group 12 months after launch. You will need to develop a strategy (TV, radio, print advertising, YouTube Video, etc.) in order to achieve this awareness target. o The media department informs you that in order to reach 70% awareness you have the choice between TV and other channels. (See toolbox below for details on awareness impacts and costs on each channel). o For simplicity you can assume the costs are for 1 years’ worth of support. o You can assume you add awareness e.g. 40% TV awareness + 20% print awareness = 60% awareness. Up to a maximum of 100% awareness. Prime Prospects: Develop marketing ideas to target your prime prospects. o How can you effectively reach them and convey the message of HUGO energise (think about how to bring the concept of energise to life) and drive them in-store. 2ml samples of the fragrance are available to you (see more details on sampling below). Work o with CMK to understand the best places to reach your prime prospects.

You should assume that $585,000 of your marketing budget should be spent against your ideas defined here and covers all the ideas you have to reach your prime prospects. Disclaimer:


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What are the Key Elements to determine your Marketing plan? 

The target audience: Whom are you communicating to? (Consumers characteristics, demographics and psychographics profiles…). You will need the expertise of CMK (market research) to determine your target audience. How do you effectively target your prime prospects?

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Seasonality/ timings – peak seasons, holidays, new product launch, events …

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Communication goals – media choice, awareness goals

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Budget priority – proposed actions and priorities if budget is cut or increased.

Sampling: Sampling is an excellent promotion tool as this gives you the opportunity to offer your product for testing at a strategic place. This can be a key tool to build trial and you can combine it to: 

Generate purchase: with in-store sampling.

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Build on your image: with sampling at specific events (concerts, parties…).

There are 4 main ways of sampling: 1) Broad scale sampling: national free distribution organized via specific stores or places (cheaper, enables high reach/ # of contacts, but less effective on image building). 2) Events sampling: targeted free sampling via teams and/ or branded areas (expensive, very effective in image building, lower reach/ # of contacts). 3) In-store sampling: national or targeted in-store sampling (expensive, lower reach/ # of contacts, effective in driving purchase). 4) Internet sampling: register on the Internet to get a sample, purchase is higher because consumer requested the sample, creates database for future contacts, enables to trigger a relationship with the consumer. Assume sampling costs are covered in your budget for prime prospects.

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The Toolbox:

Media    

TV 

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Print

Disadvantages

Advantag

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Excellent for national coverage Fast awareness builder. Good for image building. Quality of your message (audiovisual). Given P&G’s buying power with TV stations (based on the high volume of airtime bought for all P&G brands) High theoretical reach. Targeted medium (magazines). Local to national coverage. Multiplicity of contacts (several readers). Print is more in line with the prestigious image of Deep Red.

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Outdoor

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Good for image building Local & national coverage.

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Radio

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“Targeted” medium. Local & national coverage.

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Cinema

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Ideal for targeting 14-34 year old. Good for image building. National to local coverage. Captive audience. Quality of your message (audiovisual). Low level of duplication.

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Difficult to target specifically. Expensive. Foreign channel competition. Low audience focus (zapping).

The Costs & Awareness Rates

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Awareness 30% = 1,200,000$ Awareness 40% = 1,700,000$ Awareness 50% = 2,350,000 $ Awareness 60% = 3,200,000 $

Complex to run national campaign Expensive. Static message

Awareness if done on top of TV. Awareness 10% = 300,000 $ Awareness 20% = 650,000 $ Awareness 30% = 1,500,000 $ Awareness 40% = 2,200,000 $

Expensive. Static message Need simplicity of message. Low audience focus

Awareness if done on top of TV. Awareness 10% = 500,000 $ Awareness 20% = 1,100,000 $

Complex to run national campaigns. Low attention Audio message .

Awareness if done on top of TV. Awareness 10% = 500,000 $ Awareness 20% = 1,100,000 $

Low level of contacts. Expensive. Low awareness builder. Limited beyond 14-34 year old target.

Awareness if done on top of TV. Awareness 10% = 350,000 $ Awareness 20% = 650,000 $

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CEO Challenge Phase 1 Brand Manager Challenge

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