Parvaderm Case Analysis

1. The two decision problems that Phoebe Masters needs to address are as follows:

a. Phoebe Masters needs to decide whether 5 ½ ounce or a 10 ounce aerosol container should be introduced.

b. Phoebe Masters needs to decide whether she should approve additional funds for a market test

Phoebe's problems stemmed from deciding to whether or not to introduce a new package design for the company's Soft and Silky Shaving Gel.

2. Market Segmentation

a. Behavioral Segmentation

i. Women who work outside the home (shave more frequently)

ii. Women who do not work outside the home (do not shave frequently)

iii. Shaving frequency varies by season (summer months produce the greatest shaving activity)

1. In-store promotions and multipack deals were scheduled during the summer...which is a great move, considering this is when shaving gel is sold the most.

Note: the more women shave, the more shaving gel they consume/use and they will need to purchase more shaving gel frequently...especially if it were in 5.5 oz can...10 oz can will last the consumer approximately twice as long and they may not buy the product as frequently.

b. Benefits Sought Segmentation

i. Women want a shaving a gel that contains a moisturizer, reduces irritation, and makes shaving easier. (4 out of 5 women use a moisturizer after shaving)

ii. Parvaderm changed the ingredient formulation in 1995 to cater to consumers wants and needs. (media advertising and in-store promotions emphasized the product improvement.)

Note: this change was most likely made in order for women to choose this brand of shaving gel over other brands.

Question-Since we are focusing on one product that Parvaderm produces is it safe to say that this is a "segment of one"...Mass customization...or is this referring to something else?

Requirements for Effective Market Segmentation-the six fundamental buyer-related questions for each market segment:

a. Who are they? Women (work outside the home and do not work outside the home)..The women who work outside the home should be targeted the most

b. What do they want to buy? Shaving Gel; that contains a moisturizer, reduces irritation, and makes shaving easier. (4 out of 5 women use a moisturizer after shaving)

c. How do they want to buy? In aerosol cans; preferably the 10oz because it would require fewer purchases.

d. When do they want to buy? Year-around but peak season is in the summer

e. Where do they want to buy? Food or drug store; either next to the tube containers or stocked with women's toiletries.

f. Why do they want to buy? To shave their legs and because this product contains more moistures and satisfies their needs compared to other products....also could say that this product contains more (if 10oz) than it's gel competitors and is cheaper per oz. than their gel competitors (e.g. when compared to gillette's gel which is 7oz for .43 per oz; soft is silky is cheaper 10oz for the same .43 per oz.

4. Relevant fixed costs in the case-*most relevant information regarding the specifics in the case

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