Assignment on Marketing Strategy – Ariel

Program	Diploma in Business
Unit Number and Title	Assignment on Marketing Strategy – Ariel
QFC Level	Level 5

Introduction

The current assignment deals with the detailed study of an organisation that is in the marketing of detergent and is written under the guidance of Locus Assignments’ expert assignment helpers in UK. The detergent organisation chosen for the assignment is Ariel. The assignment consists of two parts. The first part describes the company’s marketing audit, SWOT analysis, competitive advantage in the form of USP, evaluation of the marketing strategy, and market position relating to other organisations. The second part of the assignment examines the organisation’s goals and objectives, segmentation, targeting, and positioning of the product in the market, marketing strategies, and marketing mix. The second part of this assignment also comprises the study of how to increase market share, improve profits, and enhance brand reputation and awareness.

 

Ariel

In the modern world, Ariel is considered one of the best detergents worldwide. Ariel introduced itself into the market in 1967 with a combination of an enzyme-based compound and encapsulated bleach, which was an innovation of that time. In the 1980s and 1990s, other detergents offered whiteness and brightness to clothes, but only for two or three washes. Then, in 1992, Ariel introduced a bleach-free detergent innovation, which brightened clothes while preventing them from fading. In 2001, to save time, liquitabs were introduced to deliver unbeatable results quickly and easily. Ariel is a brand of P&G, with its headquarters in Ohio, USA. (Ariel, 2016)

 

Situational Analysis

 

SWOT Analysis

Strengths

• It is a product of one of the leading companies, Procter & Gamble. P&G is the parent company of Ariel.

• In the detergent sector, it is the worldwide leader.

• Guarantees to remove stains, even the toughest ones, in a single wash.

• Utilises enzyme technology.

• Sweet smells and fragrances in detergents were first introduced by Ariel.

• Holds a strong market share.

 

Weaknesses

• The tactics and strategies involved in promotional activities are not robust.

• Promotional activity is irregular, with gaps in continuity.

• Pricing strategies are inconsistent, with fluctuations in product prices.

• Advertising is insufficiently effective, with limited recall value.

• A large number of competitors exist in the market.

 

Opportunities

• The detergent market is vast, amounting to nearly £5.7 billion.

• The rural market remains largely untapped.

• With a significant market share, it has the potential to become the undisputed leader in the detergent market.

• Opportunity to increase product awareness.

 

Threats

• Other strong players exist in the detergent market.

• Substitutes for the product are easily available, especially in rural areas.

• Intense price competition in the market.

 

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PESTLE Analysis

1. Political Factors

This refers to how the company is affected by political factors in the UK.
 

a. Positive Effects:

• Citizens are highly influenced by internal governance systems.

• Active government directly impacts the company positively.

• Stable political conditions foster organisational growth.

• Administrative division at national and local levels facilitates easier interactions.

b. Negative Effects:

• Corruption within the system.

• Decision making on Brexit. Uncertainty stemming from Brexit significantly affects the organisation.


2. Economic Factors

The UK’s economic position is relatively stronger than many other nations.

a. Positive Effects:

• Globally ranked 5th in GDP and 2nd in Europe.

• A large population allows small markets to generate good profits.

• Presence of both public and private sectors in the economy.

• Free market structure enables easy entry and exit of firms.

• High foreign direct investment (FDI).

b. Negative Effects:

• Slow recovery post-2008 recession.

• Extensive financial resources are allocated to public services and aids.


3. Social Factors

Social factors are crucial in PESTLE analysis, reflecting all-round performance.

a. Positive Effects:

• Numerous free public facilities.

• High population density, approximately 65 million.

• Openness to migrants, with around 13% of the population born outside the UK, reduces workplace costs.

• High living standards.
 

b. Negative Effects:

• Rising dependency ratio.

• Increasingly expensive education.


4. Technological Factors

The UK is well-equipped economically and technologically.

a. Positive Effects:

• High-quality innovation skills.

• Expertise in the IT sector.

• Effective enforcement of intellectual property laws.

• Competition fosters growth.

b. Negative Effects:

• Slower technological development compared to the United States.

 

5. Environmental Factors

Over the years, Ariel has maintained a strong reputation by effectively using renewable energy sources and prioritising sustainable development. Customers regard Ariel as eco-friendly.

 

6. Legal Factors

Different countries have varying rules and regulations for companies. Ariel must strategise and make decisions while adhering to UK laws, rules, and regulations. (Bush, 2016)

 

Competitive Advantage (USP)

USP stands for unique selling propositions. The advertising campaign for a company needs to be successful for its growth, and this theory plays a key role in determining or clarifying the success of an advertisement. Every company has a unique feature that helps establish its personal brand. USP is also used to describe a product in comparison to similar products or competitors' offerings.

The USP of Ariel is its longstanding presence in the market. Ariel is widely recognised as a detergent capable of removing even the toughest stains. Additionally, it was the first company to introduce fragrance in detergents.

 

Differential Advantage

This refers to the distinctive feature or advantage that a company or product has over competitors' offerings in the market. Consumers often have several options for a particular product. Differential advantage refers to how the targeted audience perceives a company's product as superior to competitors' products. This advantage enables a company to establish market leadership.

One of Ariel’s key advantages is its brand symbol, which is globally recognised as a mark of excellence in detergents. Ariel has established itself in the minds of its target audience as the detergent that excels at removing even the toughest stains. Additionally, corporate social responsibility initiatives play a vital role in enhancing Ariel’s competitive advantage. (The Economist, 2015)
 

 

Evaluation of Current Marketing Strategy

 

Growth

In the UK market, Ariel is regarded as one of the top-tier detergents, successfully positioning itself as a strong competitor. It has recently introduced medium-priced products to compete with rivals offering lower-priced alternatives. The primary aim of these medium-priced detergents is to compete with low-cost products and capture a larger market share. To foster growth, Ariel continuously engages in promotional activities, with its advertisements proving highly effective.

 

Sales Trend

The diagram below illustrates the intense competition in the UK detergent market. Other brands in the sector have an equal market share and pose significant competition. Moreover, these competitors often provide products at lower prices, which presents a considerable challenge for Ariel.

 

 

Profitability

There are many competitors in the detergent sector in the UK market, and Ariel has performed exceptionally well in terms of profitability comparison. Ariel is regarded as a product of the best quality. The prices are high, and customers associate the price of the detergent with its quality, yielding high revenues from sales. It is the best and leading brand in the detergent sector of all time. In the UK, Ariel's profitability is higher compared to that of its competitors. (Ariel, 2016)

 

Segmentation, Targeting, and Positioning

 

Segmentation

Customer segmentation is based on the value of the customer. Identifying potential customers is essential for any company, and Ariel segments its customers accordingly. Ariel operates in a market growing at a very fast rate. As the market already exists, segmenting the customers becomes a much easier task. Categorising customers is simpler in an established market.

The detergent market is predominantly segmented into two categories: psychographic and demographic segmentation. Market segmentation is a strategy of dividing customers with similar buying patterns and habits into groups. These groups consist of individuals with similar needs, who hence buy the same products. Ariel is a single product required by all segments of society, but the size of the packet purchased varies. The ways to segment the detergent market are as follows:

1. Demographic Segmentation: Ariel is mostly used by young and middle-aged women who wash clothes for their families. Married women consume the product in large quantities as they wash clothes for the entire family. Washing powder is used by all sections of society, regardless of occupation or educational background.

2. Geographic Segmentation: The major usage of premium detergent is in urban areas. Most sales come from large cities. In rural areas, people tend to depend on local detergents. The company markets its premium products in urban areas and its low-range products in rural regions.

3. Psychographic Segmentation: Washing powder or bars is an essential requirement for everyone, irrespective of personality or lifestyle. The upper-middle class is brand-conscious and prefers expensive products.

4. Behavioural Segmentation: The usage of detergent is not influenced by people’s behaviour. Most people lack brand loyalty when it comes to FMCG products, focusing instead on the benefits provided by the goods. (Mindtools, 2016)
 

 

Targeting

Ariel is an FMCG product required in every household for washing clothes. Ariel targets all sections of society, including the upper, middle, and lower classes, as everyone needs to wash their clothes. For the lower-income segment, Ariel has launched small sachets that are more affordable. Most sales come from large cities, where the major targets are household ladies who aim to keep their clothes clean and in good condition.

When targeting a specific group of customers, their needs and desires must be identified. The size and capacity of the target market must also be understood. Marketing efforts should address all market segments, with promotions aimed at increasing market share. Large, premium products are sold to niche markets, while smaller and less expensive detergents and bars are marketed to smaller segments.

The company must also identify the services it can offer to customers and understand the barriers affecting the targeting process. Strategies should be implemented to overcome these barriers, gain a competitive advantage, and identify threats and opportunities that could affect the company. (Anand, 2009)

 

Positioning

Ariel is a trusted detergent brand found in most households. It is well-known for customer satisfaction and is perceived as better than competitors, fostering brand loyalty. Ariel simplifies customers’ lives, making it a strong brand in their minds. Customers often buy Ariel without hesitation.

The strong positioning of the product is enhanced by its brand name and packaging, which also contribute to its sales. To attract customers, Ariel’s positioning must remain stronger than that of its competitors. Improved packaging and effective advertising can bolster its market position further. (Bhasin, 2016)

 

Recommended Objectives and Goals (SMART)

SMART goals and objectives can be adopted by the team, organisation, or individual to enhance efficiency.

1. Specific: This category answers all the "Wh" questions: who, what, when, why, and where. The basic goals of the business must be identified. Questions include: Who are the investors? What is the purpose of the business? Where is it located? When should operations begin?

2. Measurable: The progress of the business must be measurable within a specific time frame. It is important to estimate how far the business has come in achieving its goals. Employee experience and achievements can also be measured.

3. Achievable: The practicality of achieving the company's goals must be assessed. It is essential to evaluate the feasibility of the company’s objectives and plan the steps needed to achieve them. Strategies should be adjusted as the company progresses towards its goals.

4. Relevant: The goals of the company must be realistic and achievable. Managers and employees must work collaboratively to make these goals a reality. The objectives should guide the company towards success.

5. Timely: Goals must be attained within a specified time frame. Keeping tasks on track and meeting deadlines is crucial for improving the company’s performance. (Bright Hub, 2016)

 

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Recommend Marketing Strategies Based on the Application of the Marketing Mix of Ariel

Ariel is the washing detergent sold under the parent brand Procter and Gamble. The marketing mixes of Ariel are as follows:

 

Product

Ariel is a premium quality detergent mostly popular for removing stains from clothes. The detergent is suitable for use in washing machines and also for washing clothes manually. Ariel has been in demand in the market for a long period of time. The product does not have any bleaching action on clothes and does not spoil their colour. Ariel has introduced a lot of innovation in the product, such as introducing fragrance and power bristles. Ariel has been introduced in bar and gel forms to gain a competitive advantage over similar brands in the market. (Nawaz, 2011)

 

Price

The price of Ariel is a bit higher than its competitors as Ariel delivers quality detergent. Ariel is known for making clothes white in a single wash. The pricing strategy of Ariel is in accordance with the premium range of detergents available in the market. P&G has a separate team dedicated to deciding the price of the product. The price of the detergent is a bit higher compared to its competitors, but Ariel is dedicated to providing premium-quality powder. Ariel has become the favourite product of housewives as children often create a lot of stains. People are willing to pay a higher price for the detergent as it does not harm the quality of clothes. The target market of Ariel is mainly the upper-middle class, who can pay higher prices for quality. For lower-middle-class people, Ariel has launched a small sachet. For rural areas, Ariel has launched low-price products, which have expanded the company's reach into rural areas too. (Mokgata, 2013)

 

Place

P&G introduced Ariel to the UK market in 1967. The company has extended its market to many countries such as Japan, India, China, Peru and Brazil. The distribution network of the company is very strong, supplying its products even to remote areas. The incentives provided to distributors are also very high in the company. In every country, there is a national centre from which products are distributed to remote areas. The company owns many warehouses from which the product is supplied directly to retail stores. Ariel adopts a penetration policy for distribution so that the detergent is also available in remote locations. Every superstore we visit has Ariel in stock. The company has many associations with superstores in urban areas to adopt placement strategies. Ariel has started its online store and is also available on leading sites on the internet.

 

Promotion

Ariel has a very strong promotion strategy to increase the market share of the product. Ariel uses many channels to promote the product. Ariel employs the use of the latest technology in making its detergent. It becomes essential for them to promote their new innovations to increase brand awareness of the product.

Ariel adopts the strategy of mass marketing to market on a large scale. Very attractive advertisements are made on television and radio to attract new customers. The packaging of the product is made attractive to increase sales. Ariel also advertises its detergent on the internet. There are many campaigns launched by P&G to promote Ariel. (Aperio, 2016)

 

Conclusion

The present assignment describes the marketing strategy of Ariel, a flagship company of P&G. The SWOT analysis helps in determining the strengths and weaknesses of the company. PESTEL analysis identifies the various legal, environmental, social and technological factors attached to the marketing of the product. A proper business strategy must be selected for promoting the product.

The competitive advantage of Ariel is gained by providing superior quality detergent. Segmentation of the market is done to target potential customers. Positioning of the product is carried out to attract customers.

The SMART objectives of the company are decided by the company to achieve its goals. SMART stands for specific, measurable, achievable, reliable and time-oriented. The marketing mix of the company can be achieved by choosing the proper marketing strategy. The 4Ps of the company are promotion, place, price and product.

 

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References

• Anand, G., (2009), 4ps and STP, [Article], Available: http://www.slideshare.net/anandganpaa/ariel4ps-and-stp [Accessed 04 November 2016]
• Aperio, (2016), washing powder wars, [Article], Available: http://aperio.co.za/index.php/classic-clashes-washing-powder-wars [Accessed 05 November 2016]
• Ariel, (2016), evaluation of the current marketing strategies, [Article], Available: www.ariel.co.uk [Accessed 31 October 2016]
• Ariel market penetration strategy, (2016), SWOT analysis, [Article], Available: https://www.google.co.in/search?=swot+analysis+of+ariel+UK&espv=2&rlz=1C1NHXL_enIN714IN714&tbm=isch&tbo=u&source=univ&sa=X&ved=0ahUKEwjt6PLo2pDQAhUIsY8KHfzXAc8QsAQISw&biw=1366&bih=662#imgrc=dpUrQBLYeH02cM%3A [Accessed 28 October 2016]
• Bush, T., (2016), PESTLE analysis, [Article], Available: http://pestleanalysis.com/pest-analysis-of-the-uk/ [Accessed 27 October 2016]
• Bhasin, H., (2016), marketing mix of Ariel, [Article], Available: http://www.marketing91.com/marketing-mix-of-ariel/ [Accessed 05 November 2016]
• Bright Hub, (2016), explaining the concept of smart goals, [Article], Available: http://www.brighthubpm.com/methods-strategies/79127-explaining-the-concept-of-smart-goals-with-examples/ [Accessed 01 November 2016]
• Mokgata, Z., (2013), Unilever and Proctor & Gamble, [Article], Available: http://www.financialmail.co.za/business/media/2013/07/18/unilever-and-procter-gamble-war [Accessed 03 November 2016]
• Nawaz, M., (2016), launching Ariel, [Article], Available: http://maliknawaz.blogspot.in/2011/04/case-study-launching-ariel.html [Accessed 04 November 2016]
• Pilley, M., (2014), SMART goals, [Article], Available: http://www.brighthubpm.com/methods-strategies/79127-explaining-the-concept-of-smart-goals-with-examples/ [Accessed 02 November 2016
• Tushar, A.M., (2016), competitive advantage (USP), [Article], Available: http://www.academia.edu/12952433/marketin66g_strategy [Accessed 01