Case Study Topic : Wrong Segmentation

Chathura Kovider is a fresh graduate from the Institute of Mass Communication. He

also possess a Masters degree in Marketing Management from a reputable university.

It was through campus recruitment that Faisal was picked up by Nova

Pharmaceuticals a reputed company, having a large market sharein my OTC (over the

counter) products.

Main among these being a fairness cream named Snowhite and an ointment for burns

and cuts branded "Sburns".

The company has an all Sirilanka Presence and plans to soon launch a pain balm-cum-

cold rub named N'Cold. N'cold would be in straight competition with "Vicks

Vaporub" and "Amrutanjan".

Perera Udana, the company's marketing manager, dreams to make N'Cold a leading

brand. He has contracted Orix Marketing the country's no. 1 advertising agency to

handle the account of N'Cold.

When Chathura joined Nova he was included in the Marketing team of N'Cold.

Looking at Chathura's qualifications, and interests he was given the task of liaison

with the advertising agency Orix Marketing. After a series of meetings between

Chathura and the Account Executive of Orix, in a few of which Mr. Udana was also

present, it was decided to position N'Cold towards the adult segment of the market

since all the three of them believed that the requirements of the adult segment of the

pain balm market were different from those of the children. They were also convinced

that N'Cold had all the ingredients to meet the requirements of the adult segment of

the market.

Accordingly, the first advertising campaign of N'Cold was released in July 2008 to

the media. The company decided to concentrate on TV and the national press to reach

its targetted customers. The TV spots showed N'Cold being used on the father of a

family who is down with cold and body ache. The focus of the advertising was on the

punch line " Cold rub for elders". The timing of launching N'Cold was perfect since

the rainy season was considered boom period for cold rubs.

The initial results were very encouraging and by the end of the rainy season N'Cold

had already become a brand to reackon with. After the rainy season Orix Marketing

proposed to change the campaign and accordingly a new campaign was prepared.

While the TV spots showed a young mother using N'Cold on her school going child

the earlier punch line was entirely missing.

Chathura was not very happy from the TV spots as he felt that the new campaign

went against the earlier positioning of N'Cold. This, he felt, would confuse the buyers

and the advantage of the positioning strategy would be lost. Since Mr. Udana was

very happy with the new advertisements Chathura decided to remain silent.

Q1. Evaluate N'Cold segmentation strategy.

Q2. Do you agree with Chathura's opinion on the new advertisements? Explain why

and why not.

Q3. What would you do if you were in Chathura's place?

Q4. Do you think the advertisement can be made in some other way? If yes then how

explain the advertisement you can propose to the N'Cold management and Orix.