principles of marketing assessment durex

Durex provide customers with a lot of condoms made from several material - Natural latex- Synthetic - LambskinBesides that, Durex offers their buyer condoms with special benefits- Textur

Group Written Report

Nguyễn Ngọc Kim Dung

SITUATION ANALYSIS REPORT

b Feature & Design

1915: Durex was founded by by London Rubber Company (LRC) 1929: First Durex condoms were introduced.

1999: LRC was merged with another company to form SSL International 2010: Durex was sold to Reckitt Benckiser.

2017: Durex was preferred the most by Vietnamese single men and best seller in Vietnam

b Mission statement:

Durability, eliability, and RExcellence

Every single condom is electronically tested, to confirm freedom from holes

International standards demand that a condom can contain 18 liters of air, our condom expend to hold 40 liters of air.

“if one sample doesn't pass any of our tests, the whole batch of up to 432,000 condoms doesn't leave the factory.”

2 Product description: a Product function:

Durex has released many different products, including condoms, pleasure gels, massage gels and devices However, condom and pleasure gel had been being recognized as core products of Durex, which made a huge profit, especially condom From this point of view, Durex had come out with many different lines In fact, based on different factors of each region, Durex released different lines with different sizes and purposes In term of Vietnam market, Durex has came out with various choice for customers; these products below is some of the most popular products in Vietnam.

i Durex performance: Due to Durex web page, Benzocaine 5%, contained as a special lubricant so that this product can help men delay climax for longer lasting pleaser ii Durex pleasuremax: This product is treated with a gentle lubricant Moreover, it has

special design with dots and ribs on itself, which helps maximize stimulation iii Durex Fetherlite Ultima: This product is the thinnest latex condom that Durex have

ever made (25% thinner than standard condoms) It provides ultimate sensitivity while still providing the same level of protection.

iv Durex Tingle: A special tingling pleasure gel is coated both inside and outside of this condom, for heightened sensation, which help either woman or man can get that extra thrill.

b Feature & Design:

Durex has brought to its customers a wide range of design and feature to target differentiated segmentation with various demands.

Durex provide customers with a lot of condoms made from several material - Natural latex

- Synthetic - Lambskin

Besides that, Durex offers their buyer condoms with special benefits

- Textured condom: include studded and ribbed, which can provide extra sensations to both partners

- Adolescent condom: product that pay more attention to adolescent boys and girls - Others: anti-raped condom, collection condom, ….

c Market share:

Being one of the most well-known condom brands in the world, Durex holds 26% of the global market share and supplies more than one billion products every year However, the average number of Vietnamese customers who uses Durex as a pregnancy prevention method for a safety sexual experience just seizes at 16% of the total market share of condom Additionally, Durex is the second well-used condom with 5.89 million American users in 2018 before September

d Brand awareness:

Durex condom is one of the most well-known ways to prevent pregnancy and protect sexual health in Vietnam In fact, 85% of the Vietnamese is familiar with Durex condom Instead of choosing other solutions such as coitus interruptus, contraceptive pill, etc men prefer using condom while having sex with partners in choosing other options It is widely believed that condom is a convenient and easy protection to use with highly effective result In contrast, condom is thought as a product for sex workers or disloyal lovers whereas the main use of it is not considered correctly Because of that believes, Durex is a well-known condom brand but not well-used in the Vietnam market B Marketing Environment

1 Micro environment

a Company: + Board of Directors:

Durex was first founded in 1915 as The London Rubber Company by LA Jackson and officially registers as Durex brand in 1929 Started as selling imported condoms and barber supplies, Durex is one of the most well-known condom brands in the sexual health industry Over 80 years of

manufacturing and developing, Durex succeeds in creating high-quality products for enhancing sexual experience of customers It has widened their sales network to over 150 countries with a commitment to become not just a condom brand but also a sexual wellbeing brand This prosperity of Durex is contributed by the work of a Board of Directors, including:

- Christopher A Sinclair: Chairman of Reckitt Benckiser Group plc - Rakesh Kapoor: CEO of Reckitt Benckiser Group plc

- Adrian Hennah: CFO of Reckitt Benckiser Group plc

Durex first appeared Vietnam in 2005 by the main distribution of DKSH Vietnam Co., Ltd which is the authentic source of Durex Providing more information, DKSH Vietnam Co., Ltd is the subsidiary of DKSH Management Ltd in the Vietnam market They are working as the Marketing Expansion Services helping the international companies enter the market of Vietnam which has been contributing significant impact to the economy of Vietnam

+ Financing:

According to the annual report of Reckitt Benckiser Group plc in 2017, the total net revenue of the company has reached £11,5 billion with a huge distribution of the health and hygiene brands at £5,090 million, increased £1,758 million compared to the net revenue in 2016 The growth of these brands holds at 53% compared to the growth of 2016 was 16% These statistics provide a powerful picture of Durex due to using a large number of right strategies

b Suppliers:

The achievement of Durex nowadays is contributed by one of the key factors of a company which are the suppliers Founded in England, Durex has successfully built 17 factories around the world such as America, Thailand, India, China, etc in ability to produce more than one billion condoms every year For instance, SSL Manufacturing (Thailand) Ltd., placed in Bangpakong Chachoengsao, is a part of the Reckitt Benckiser business empire producing Durex condom This is the main source of Durex condom imported for Vietnamese customers Moreover, Durex chooses to cooperate with one of the largest condom manufacturers in the world Reckit in Malaysia to maintain the quality and quantity of products

c Marketing Intermediaries:

Nowadays, Durex has been distributing their products widely For instance, in the Asia-Pacific area, they have several selling channels in many countries such as Singapore, Thailand, Taiwan, China, Hong Kong, Malaysia, etc They have large online distribution channels some of which are eBay, Amazon, Alibaba, etc and official online website for customers to purchase high-quality products Durex also uses physical distribution to capture attention like placing them at cashiers at the eye level of customers The frequency of seeing Durex condom increases at pharmacies, convenience store, adult stores, gas station, etc

Unlike other countries, Durex has not officially expanded into Vietnam It has one representative office in Ho Chi Minh City which is Reckitt Benckiser (Thailand) Ltd for supporting contact, researching Vietnam market, conducting marketing, etc However, the main source of Durex products comes from DKSH Vietnam Co., Ltd After almost 100 years from their first encounter and facing the failure, in 1991 DKSH Vietnam Co., Ltd re-entered opening a new page of Vietnamese industry Realizing Vietnam is a potential market, it has been using various strategies to capture customers attention making Durex one of the most well-known condom brand It is regular for buyers to see Durex condoms at supermarket, convenience store, pharmacy and other retail outlets Percentage of Durex covering in the Vietnam market holds at 95% due to a huge growth of convenience stores and mini markets Moreover, several online shopping websites such as Tiki, Lazada, Shopee, etc distribute important impact in expanding the image of Durex in customers mind They have also built a website www.durex.com.vn developing an additional channel for customers.

d Customers:

Due to the simplicity of the product, segmentation and targeting of Durex was not complex Durex uses differentiated targeting strategy and primarily focus on the urban working class, and upper middle class as their target consumers They are almost from 16-35 years old (dominantly men) who are in need of sexually active and at risk in terms of sexual behavior Most of the targeted customers are the young all around the world who have no access to other contraceptives and want to protect themselves against sexually transmitted diseases (STDs) Because of the global customers, company has to tailor its brand campaigns accordingly since public attitudes towards sex differ from country to country As a high-involvement product, Durex has customers who are conscious of the value they seek in products, are able to compare between similar products from competing brands and are willing to pay “more for more” Consequently, Durex establishes itself as a sexual wellbeing brand instead of just a condom brand

e Competitors:

Durex’s sales are being greatly influenced by both indirectly competitors and directly competitors, which will be analysed clearly below.

i Directly competitors:

This section will mainly focus into those brands that are participating in condom industry In fact, Durex have different competitors from country to country In term of Vietnam market, Okamoto and Sagami are the most two biggest competitors of Durex The table below illustrates differences between Durex and these condom brands.

Brand awareness

Most popular condom throughout social media.

- Can be seen in sex shop, convenient store, and pharmacy.

Medium

-Mostly seen in sex shop and pharmacy.

- Only appear in sex shop and big pharmacy.

Core Value Durability-reliability-excellence Reliability-Comfort-Prosperity High quality – unique products and services

ii Indirectly competitors:

Based on the development of technology, more and more protecting against pregnancy had been coming out such as: pills, patch, IUD, birth control shot,etc

f Public:

Citizen-action publics : Citizen-action of Vietnam has strong voice among society, which may put a huge pressure on Durex

Durex users publics : This public group usually affect Durex by sharing and leaving comments about their experience with Durex product through many communication channel Their comments are generally believed by other consumers

Media publics : Vietnam press play a vital role that could either help build up brand equity or put a huge pressure on Durex This group including television outlet, magazines both online and offline, social media,etc

Government publics : This publics group including Ministry of health, which organization have a great influence on consumers mind about product safety

2 Macro environment:

a Demographic:

Durex strategies focus on young adults aging from 18 to 30 years old, coming from middle class and living in urban areas In Vietnam, adults from 25-45 accounted for 48% of the population (HKTDC research) Moreover,over the first 17 years of the 21 century, Vietnamese living standard has st

significantly risen as a result of the mass increase in GDP (from 31,17 to 223,9 billion USD) (Global bank), as well as that, more and more people are aware of contraceptives.

On the other hand, inferred from Geert Hofstede’ 6-dimension research, customer loyalty is quite high in Vietnam as it has low uncertainty avoidance rate, which is only 30% Therefore, once Durex successfully seduces Vietnamese customers with its satisfying condoms, it would flourish dramatically in the Vietnamese market.

b Economic:

Vietnam is rated to be one of the “fastest growing emerging markets in the world” (WorldAtlas) by 2020 with a GDP of 436 billion USD.

Moreover, Vietnam’s condom market has been growing dramatically, benefiting from favorable government policies and regulations and widespread access.The Vietnamese government has urgently stimulated the use of contraception not only to improve maternal and reproductive health, but also to attribute to the family planning program.

c Natural environment:

Located in the Southeast of Asia, Vietnam is a tropical country with high population rate, therefore it is facing lots of environmental challenges nowadays, including deforestation.

To reduce deforestation and natural resources’ exhaustion, Durex only use the best quality latex that is responsibly sourced Moreover, the waste water from manufacturing is even being safely reused in local schools

d Technological

The new male condom product which was made from polyurethane and went on the market in 1994 is said to be just as strong but only one-tenth as thick as the latex condom This product is recommended for people who are sensitive to latex condoms Durex also discovered the way to produce condoms made from plastic which is friendly-environment and it didn’t happen for any kind of health

Nowadays, condoms are viewed as a good way to reduce the probability ofpregnancy or a sexually transmitted infection (STIs) So, government recommends the people using condoms to minimize the sexual problems That is the reason Durex can introduce their products in many countries without difficulty However, there still restrictions from the government on advertising condoms in some countries

g Social

This element could become central to the work of Durex since their target is to change attitudes and behaviors that impede safer sexual practices Social marketing uses the same techniques as commercial marketing but applied them within a social and health context to encourage people to change their behaviors.There are plethora of social campaign that Durex operates to engage their targeted customers.

· The Durex #DoNotDisturb campaign, challenged couples to give up their phones and technology on holiday to teach them a lesson about how it might negatively impact their levels of intimacy

· The ‘When It’s On, It’s On’ campaign also featured groups of young men and women talking about safe sex and misconceptions when it comes to using condoms.

C SWOT Analysis 1 Strength:

+ Experience in the industry : At the beginning, started as London Rubber Company in London in 1915, Durex was named after being trademarked in 1929 Having experienced with over 80 years in manufacturing, Durex has built 17 factories worldwide able to supply over one billion condoms every year Through many years of developing and

improving, Durex has appeared as a market leader.

+ Product portfolio : Durex satisfy customers needs with wide range of products with commitment to enhance experience as well as protect users Providing various categories of size, flavour, texture, etc Durex succeed in meeting customers demands Their products produce based on three main elements which are pleasure, comfort and fun Understanding the needs of their customers, Durex has emerged as a well-used condom in a large number of condom brands.

+ Wide-spread Channels: Availability in over 150 countries, Durex demonstrate as a strong sale network condom brand by using physical distribution to capture consumers attention They uses POS through many channels such as Pharmacies, Convenience Store, Health Clinic, etc to attack their image to customers mind leading to the increase in using

2 Weakness:

+ Ethical issues: It is shown that Durex use various forms of television advertisements which are not only capture attention of viewers but also cause controversy in many countries with sensitive thoughts about condoms and sexual products.

+ High price: Durex have higher price comparing to competitors which also offer good quality products with more reasonable price In some regions like Vietnam, the price of Durex cause a barrier to consumers due to the low income of the people

+ Huge efforts put on promotion of sexual health can be advantage for competitors: Durex put money and efforts into creating awareness and enhance knowledge of consumers in sexual care by running a large number of advertisements and campaigns This strategy leads to the increase in consuming of the whole condom market but not only Durex, which is huge advantage for competitors.

3 Opportunities:

+ High growth in sexual awareness: People get more and more awareness in Sexually Transmitted Diseases (STD) leading to the increase in usage rate and consumers demand in order to create a protection in sexual experience

+ Advancement in technology: High technology machine in manufacturing is an advantage of Durex in producing more efficiently and lowering costs Additionally, Durex launch several apps to provide new forms of sexual experience helping their users to get closer to each others.

+ Maturing Needs: Sexual experience is one of the most basic human needs in nowadays It is acceptable for people to consider sex plays a significant role in human life There is a continuous growth in sexual care products because of the demands of consumers in having sexual experience

4 Threats:

+ Huge number of competitors: Durex have a lot of competitors in all range of products such as condom (Sagami, Volcano, Trojan, OK, etc.), sexual lubricant (Uberlube, Astroglide, Shibari, etc.) with lower and competitive price

+ Other sexual protection: There are many forms of sexual protection such as oral contraceptive pill, implants, IUDs (intrauterine devices), etc causing huge threat in the business of condom sales