FALL 2016

STRATEGIC MARKETING (MKT 460) SEC: 04

INSTRUCTOR: NARMIN TARTILA BANU (NTB)
SCHOOL OF BUSINESS & ECONOMICS
NORTH SOUTH UNIVERSITY
Date: 01 DECEMBER 2016

SBU: Keya Soap

Team Members:

NAME #ID
1. Bashu Biswas # 1310099030
2. Imrose Hussain Pranto # 1230547030
3. Syed Irfan Waky # 1230297630
4. Subra Sen # 1230031030
5. Ryad Uz Zaman # 1321073030
6. Md. Ekramul Haque # 1330620630
1st December, 2016
Narmin Tartila Banu
Lecturer
North South University
Department of Marketing & International Business

Subject: Submission of Project report on Keya Soap Declining Sales and Corrective Measures.

Dear Madam,

This is to inform you that our assigned project on MKT 460 is completed and we are presenting this
completed report on Keya Soap declining sales and the corrective measures should need to be taken.

In this project, we have tried to implement our learning from this course. We gathered information that we
believed is appropriate to complete this project work. Despite many limitations, we have tried our best to
make this report accurate and reliable. This report is mainly focused on the problems that’s are facing by
the Keya Soap and the corrective measures that Keya Soap need to consider. For this project, we try to
analyze three frameworks to understand about the industry and the current scenario of Keya Soap those are
Pestel Analysis, SWOT Analysis, and Porters five forces. After analyzing those framework, we try to come
up with some of the recommendation strategies for Keya Soap to increase the sell.

We are grateful for the opportunity that allowed us to have this interactive learning experience which
allowed us to put our learnings and experiences into real world applications.

Yours Sincerely,

NAME ID Signature
Bashu Biswas # 1310099030 ………………………….......
Imrose Hussain Pranto # 1230547030 ………………………….......
Syed Irfan Waky # 1230297630 ………………………….......
Subra Sen # 1230031030 …………………………........
Ryad Uz Zaman # 1321073030 ………………………….......
Md. Ekramul Haque # 1330620630 ………………………….......
Table of Contents
Introduce the industry .............................................................................................................................. 1

Introduce the company ............................................................................................................................ 1

Introduction of the SBU: ......................................................................................................................... 1

Micro and Macro Environmental Factors ................................................................................................. 2

Macro Environmental Factors: ................................................................................................................. 3

SWOT Analysis: ..................................................................................................................................... 4

Porters five forces model Analysis ........................................................................................................... 5

STP: ........................................................................................................................................................ 6

Segmentation: ...................................................................................................................................... 6

Target customer: .................................................................................................................................. 7

Positioning: ......................................................................................................................................... 7

4P’s ......................................................................................................................................................... 7

Product: ............................................................................................................................................... 7

Price: ................................................................................................................................................... 7

Place: .................................................................................................................................................. 7

Promotion:........................................................................................................................................... 8

Problems Keya Soap is facing: ................................................................................................................ 8

Solutions Recommended Strategies: ........................................................................................................ 9

SWOT (TOWS) Matrix Strategies: .......................................................................................................... 9

References............................................................................................................................................. 11
Introduce the industry
The soap industry in Bangladesh is Booming and it belongs to the Growth stage in the product life cycle,
but it is advancing towards the Maturity stage. The total size of the industry worth 720 crores of taka. There
are various companies that are providing beauty soap in the market such as Lux, Meril beauty soap, Keya
beauty soap, Aromatic Beauty soap and others. Among them Lux is the market leader worth about 320
crores of taka and has more than 50 percent of the total market share. Keya on the other hand, has 10 percent
of total market share and it worth 72 crores taka. The industry also has some of the foreign brands which
are imported and sold in the market and occupies 5 percent of the total market share. The presence of so
many competitors both Local and Foreign companies makes the market more competitive. And the firm
operating in the current market should offer better quality product and gain more market share.

Introduce the company

Keya Group started its jorney in 1983 as a small company named Khalque and Co. Mr. Abdul Khaleque
Pathan the owner started this business with only one product offering which is the Keya super beauty soap
and today the company operates six industries and has about 10000 employers working diligently to offer
customers with the best quality product. The others industries Keya operates in are cotton industry, the
knitting and garments industry, agro based product industry, the yarn industry and the cosmetic industry.
Keya Cosmetics industry was established in 1996.Keya cosmetics ltd after its establishment have been
working hard to serve its customers with the best quality product and create a brand image in the minds of
the customers and has been successful to become one of the leading cosmetics industry of the country. Keya
cosmetics offers a wide variety of products to its consumers like toothpaste, shaving foam, shampoo but
their most popular product is Keya soap. Keya beauty soap captures about 11% of the market share. Keya
cosmetics ltd from the beginning was able to create brand awareness in the minds of the customers through
its advertisements and promotions.Keya was the first to sponsor and still continues to sponsor the popular
Bengali entertainment program Ityaddi and all these promotions and advertisements have helped to make
a household name among the consumers.

Introduction of the SBU:

One of the SBUs of Keya Group is Keya soap that falls under Keya cosmetics Limited which is one of the
leading cosmetics manufacturing companies in Bangladesh located at Kona Bari (Gazipur) covering an area
of 28800sft incorporated in 1996. The company has started as Private Limited Company but converted into
Public Limited Company in the year 1999. Keya Soap was a renowned brand in Bangladesh and quite

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popular among the customers because of its attractive packaging and advertisement during 2000-2005.
When it came to the market, it mainly focused towards woman and beauty and came with lots of variety of
their product. Huge exports of Keya soap were being made in India, Malaysia and Middle East. Keya soap
contains 100% vegetable fat, 8% glycerin and it its 100 percent halal soap which satisfies the need of Islamic
minded people. But now days the sales of Keya soap are somewhat less due to the arrival of the competitors
like Lux, Dove, Tibet Beauty Soap and Lifebuoy and also due to the lack of advertisement of their product.
Some of their variants are now hardly available in the market which can be the cause of lower demand from
the consumers.

Micro and Macro Environmental Factors

Customers:
Keya soap from its inception has been trying hard to satisfy the needs of upper to lower middle class people
earning low to moderate income. The industry has come up with various variants of soap to cater to the
needs of the consumers and have provided the best quality products for its customers.

Competitor:
Keya soap faces stiff competition from both local and foreign competitors in our country. Local competitors
are Meril, Tibet, Lily while Lux captures about 50% the market share in the country. Keya is always aware
about the competitors’ strategic and marketing plan and thus able to compete in the market along the lines
of these tough competitors. The pricing has been kept at an affordable rate to compete in the market but
recently Keya has been lacking behind with their print and social media advertisements than its competitors.

Suppliers:
Keya soap has always promised to provide best quality product for its customers and to continue doing that
they need the best quality raw materials to produce the product. Without these raw materials it is impossible
to provide best quality soap and thus suppliers play a huge role in the manufacture of the product. Keya

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beauty soap is 100% halal without any animal fat and the main raw materials come from suppliers of
countries’ like Malaysia, Japan, Indonesia, Italy, Germany, Singapore, England, Switzerland and USA.
Distributors:
Keya cosmetic’s products are moved straight to warehouse from their manufacturing plant. From there the
soaps are sent to the distributors who then sell it to wholesalers and retailers. From there the products reach
the hands of the consumers.

Macro Environmental Factors:

Political and legal factors:
Bangladesh’s political system is not that stable. Here in Bangladesh political strikes occur most of the time
and as a result it is very difficult for the suppliers of the soap company to supply the raw materials and most
of the raw materials of Keya come from foreign countries. So one day of strike could make the company
go towards huge loss due to the stop of their production. On the other hand, the positive fact is that there
are no strict regulations on the marketing of the product and no hard rules and regulations for the company
from the government.

Economic Factors:
If we see the current stats of our county we can see that overall GDP of the country is increasing and also
the inflation of the country is moderate. On the other hand, the income of individuals is also increasing. As
a result, the consumption of the soap is increasing. Those who used to bath using laundry soap in rural areas
also moving towards the beauty soap which is a positive site.

Social Factors:
Social factors include the cultural aspects and health consciousness, population growth rate, age
distribution, career attitudes and emphasis on safety. Education level of Bangladesh is getting higher and
higher as a result people get to know more so they know the benefit of using soap even the people from the
rural areas. On the other hand, most of the woman in our country is very much obsessed of beauty and Keya
promotes them as beauty soap.

Technological:
In the last 10years the technological environment of Bangladesh has improved and it is continuously
accelerating. Companies can reach its target customers very easily and even the customers who live in rural
areas. They belong to socio-economic class D and E. They are basically poor and uneducated people. These
people can’t read newspaper or magazine. As a result, these people cannot be pursued through print ad in

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newspaper or in magazines. Instead they can be attracted through the advertisement on Television, Radio
and mobile phone.

As per the table you can see that most rural people have Mobile Phone as compared to other forms of media.
So, the Keya Soap should concentrate on this form of media. Because using this media will bring greater
exposure to the message. On the other hand, the rural also has television and Radio for their entertainment.
So, the company can design effective radio and TV commercials to attract the customers. Specially Radio
because in most villages there are no electricity and people listen to radio the most. And for the TV
advertisement the company should choose Bangladesh television because in rural areas they don’t have any
other TV channel accept BTV.

Environmental:
When it comes to the environmental factor it means the Nature from which the raw material is extracted.
Extracting resources from the nature causes serious damage to the environment and there the government
of Bangladesh has given rules and regulation which the industry has to follow these

1. Through protection and improvement of the environment ecological balance and development has
to be maintained.
2. Identify and regulate the activities which pollute and effect the environment.
3. Ensure environmental friendly sound in all sectors.
4. Ensure long term, sustainable and sound use of natural resources.
5. Actively remain associated with international environmental associative to the possible extent.

As far as the environmental factor Keya Soap does not violate any of the following rules. Keya import all
of its resources from countries like USA, Malaysia and does not cause any harm to the environment. And
also when it comes to the pollution created from manufacturing plants, Keya produces minimal amount of
waste and the pollution level does not go beyond the standard set by the government.

SWOT Analysis:

Strengths:
• Many Variants (Keya lemon soap, Lifeguard, Natural Soap)
• Strong distribution channel
• High skilled employers.
• Quality control department for maintaining the quality
• Improved machinery from USA to manufacture soap.
• Conglomerate business advantage

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Weakness:
• Lower Brand equity
• Mainly positioned towards woman
• Very few promotional activities
• Less demand of Keya Soap in the market
• Hardly available in the market
• Negative consumer perception towards the brand

Opportunities:
• Large amount of demand in the market
• Lots of male customer
• Easy access of raw material
• Large amount of suppliers
• Many new TV shows airing everyday related to female beauty.

Threats:
• Lots of competitor in the market
• Highly competitive market
• Intensive promotional Activities from the competitors
• Political unrest
• Increasing Raw materials cost
• Technological changes can replace the industry

Porters five forces model Analysis

Competitive rivalry:
For Keya soap, competitive rivalry is very High, because the soap market in Bangladesh is full of players.
Where brand like LUX, Dove, Dettol are dominating the market. Lux being the market leader has majority
of market share. There is no switching cost for this soap market so that consumer can easily switch any
brand. There is also very low customer loyalty which makes the industry more competitive.
Threat of new entrants:
Because of no government restriction and less entry barriers threat of new entrants is High. The raw material
required for manufacturing soap is palm oil which can be easily accessible from our neighbor’s country.
The need of capital to join the industry is also not high and easily accessible to the distributors and all the

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necessary inputs. So, that the industry is very attractive and more attractive the industry higher the threat of
new entrants.
Bargaining power of suppliers:
Low bargaining power of suppliers as the raw material is not differentiated. Easy to get supply material
from the plenty of supplier. Due to lots of supplier in the market there is an internal competition between
the suppliers so the companies have power over the supplier. The switching cost of suppliers is very low
company can go with the supplier offering cheaper price.
Bargaining power of buyers:
Bargaining power of buyers is high as consumer has so many options to select from. Soap is not a
differentiated product consumer treat it as a commodity. Consumer don’t think much before buying soap.
Consumer always want to purchase this kind of product at cheaper price with quality so they can easily
switch from one brand to another brand. There is no switching cost for consumer. So, the buyer has high
bargaining power in buying soap.
Threat of substitutes:
For soap market, there is a High threat of substitutes. Different types of liquid soap like body wash, Face
wash are the main substitute for soap. Those substitute products are also in similar price range of soap. Face
wash and body wash already expanding their market share in the soap industry. There is also no switching
cost for consumer which also increase the threat of substitutes.

STP:
Segmentation:
Bases Sub-category

Geographic Area Urban Sub urban Rural

Demographic Age 0-15 15-30 30-45 45and above

Gender Male Female
Income Below 3k 3-15k 15-30k 30-70k Abov
e 70k
Socio A B C D E
economy
Psychographic Lifestyle Success- Beauty- Health Trendy
oriented concern
Personality Sincerity Excitement Sophistication Competence
Behavioral Loyalty level Brand Split Shifting No loyalty
loyalty loyalty loyalty

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Target customer:
Geo unit: Urban, sub urban, rural
Age: 15-45
Gender: Female
Income: from 3-30k
Socio economy: B, C & D
Lifestyle: Beauty concern, Success oriented
Personality: Sophistication & Competence

Positioning:
Female, who are concern their beauty, Keya offers three different beauty soap that contain ingredients like
cocoa butter, sandalwoods and natural oil to take proper care of their skin. Serving that purpose Initially
Keya beauty soap used Bangladeshi young rising stars to position their brand, who are glamorous, ambitious
& confident. For example: Nobel, Mou, Mim. Young generation found those advertisements catchier as
those are based on romance. Later, they focus on the feminine superiority, that every girl is special.

4P’s
Product:
Keya beauty soap is oval shape; simple but gorgeous, without any picture on the packet. It came into three
colors, white, green and pink. They use vegetable oil to produce Keya beauty soap. As per their RTB on
packaging; rose, fruits, cocoa butter, sandalwoods, tube rose and natural oil are the other key ingredients.
Price:
Keya beauty soap, as a challenger brand fall into price sensitivity scenario. Initially For 90gm of Keya
beauty soap they charged only 20tk, though their producing cost was below 20tk, but it didn’t help to
generate sufficient revenue for the company. In addition, every season there used to offer some price
discount or gift item with a bundle of soap purchase.

Place:
As Keya beauty soap target their customer from all over urban, suburban & rural area, they started with a
strong distribution channel. They made their product available in almost every store, from super shop to
small grocery store; consumer can easily get Keya soap of any possible size. In the rural area it was also
going available as in urban area.

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Promotion:
Keya beauty soap used to promote their product by every possible medium. They made a few
advertisements with a rising model of Bangladesh. It was successful to grab attention of the consumer. Then
they had a strong public relation tactics, by sponsoring ‘Ittadi’. Ittadi was a famous TV show that time, in
the break Keya’s advertise used to play, guest participants of that show used to receive gift hamper, which
is full of Keya cosmetics products. Then Keya used to do sales promotion by offering to its consumer that
with purchase of every 72-piece soap, 8-piece soap is free.

Problems Keya Soap is facing:

Less Promotional Activities

There was a time when Keya cosmetics used to promote their products with advertisements, billboards and
various other mediums but nowadays a Keya ad or billboard is rarely to be seen. They have cut down on
promotional cost to earn profit which has affected the business badly as Keya’s competitors are using
various promotional activities to retain brand awareness and improve brand image

Consumer perception regarding the brand

If consumers now have to a soap between Keya and Lux or Meril they will go for Lux as people now has
this perception that Lux is better than Keya. Even though Keya is providing the same products but
consumers still prefer Lux or Meril over Keya. This is causing Keya to lose market share in the soap industry
to its rivals and the only reason is their failure to make consumers aware of the high-quality product Keya
offers.

Lower product quality

Keya Has been in the soap industry for many years and during this time Keya has not done much
improvement with their product or its packaging. The quality of the product according to consumers is
lower than its competitors. Even though Keya has advanced machinery and skilled employers working in
the R and D department the company has failed to bring about any change in its product in terms of quality
or packaging or even fragrance. This is yet another problem which has caused Keya soaps to lagging behind
its competitors.

Lack of demand for Keya soap in the market

Keya soaps market demand is low among the consumers. After the product is manufactured it is taken to
warehouse. From there the distributors sell the products to retailers and wholesalers but as the demand of
product is low most of the retailers and wholesalers refuse to buy the product from distributors. Most of the
time it is because they already have Keya soaps in stock brought previously that are not sold due to low

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popularity among consumers while others times retailers already have bought a whole stock of competitor’s
soap because of its higher demand in market and are not willing to buy another soap.

High competition
Keya is facing a very stiff competition from its rivals and Keya is facing difficulty handling this competition
due to their problems in distribution channel and marketing strategy. While competitors of Keya are using
various promotional activities, and investing in social media marketing and distribution channel Keya has
failed to take corrective measures and actions to remain competitive in the market. In such competition
industry companies need to stay one step ahead of their rivals to be successful but Keya is falling short.

Solutions Recommended Strategies:

To come up with the solution recommendation at first, we need to understand the situation. There are two
scenarios at the market either consumer is not aware of the Keya Soap or the consumer are renown with the
Soap but they are not likely to buy this soap. From our analysis, we believe that Keya Soap has both the
problem there are some customer are not informed with the brand and others are not likely to buy this
product. So, keep in that mind we suggest some of the following strategies to overcome the problems.

SWOT (TOWS) Matrix Strategies:

SO Strategies:
 Introduce new variant for male segment by utilizing advance machineries and easy excess of raw
materials as market has high demand of male oriented Soap
 Enhance the product quality by access to quality raw material and using quality control department.
WO Strategies:
 Endorse more beauty related programs like beauty tips program, beauty contests model hunting
programs to increase the brand equity.

ST Strategies:
 Ready to adopt any kind of technological change by taking action with improved machineries and
skilled employees.
 Start intense promotional activities by utilizing resource and finance of Keya Group to stay in the
comparative race

WT Strategies:
 Repositioning the brand to change the negative consumer perception towards the brand and survive
the comparative market

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Rebranding though New IMC
From our analysis, we find that one of the key region behind Keya Soap failure is less promotional activities
which make the brand invisible to the customer so it is high time for Keya to rebrand the product with a
new IMC. The objective of the IMC will be rebranding the Keya soap and provide the consumer a whole
new experience. To make this IMC Keya Soap need to start intense promotional activities by using digital
marketing, billboard add, printed media add, TV Radio advertisement. Keya Soap also can endorse current
popular celebrities to make the adds. And run the TV and Radio advertisement most frequently at pick
hours and different popular TV shows. Change in packaging can give new experience to the customer.

Repositioning
We suggest Keya Soap should reposition the brand towards consumer mind to improve the consumer
perception towards the brand. Keya beauty soap is already started a campaign, which is a TVC, showing
that ‘You are special’. They tried to focus on feminine superiority. But where they lack, is their promotional
channel. They run this TVC only on online media and YouTube video streamer, but not even that much
viral. This is where they lack; they didn’t use other major channel, like television broadcasting, print and
billboard. So, they fail to reach the message to max number of target customer. They should’ve gone for
360 marketing for this repositioning activity.

Push strategies at the rural area

In the rural area people have less brand preference than urban areas. Rationally where city people are more
conscious people from rural area are less conscious about the brand there are using. So, Keya Soap can take
the opportunities and took the market by push selling though the retailer. Keya Soap can increase the profit
for the retailer from Keya Soap and force the retailer to keep only Keya Soap.

Improve product quality

Keya already have improved machinery and they also buy raw materials from USA to manufacture soap.
But despite of having these and also the Quality control department they are unable to provide high quality
products because their quality control department is not that strong. So, what Keya must do to ensure quality
is that they need invest more on this department.

Increase the target market

Keya needs to increase their customer base. So far, Keya’s main target customers were female. They were
trying to attract the female customers with their beauty soap. Now Keya should also include male as one of
their target customers and bring out soap specially formulated for the men’s skin using their hi-tech
machinery strong R and D and skilled employers. Nowadays men are very much conscious about their skin
and a skin care soap for men can prove to be successful for Keya.

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References
keya Group. (2016, November 28). Retrieved from Keya Group BD Web site:
http://www.keyagroupbd.com/

Keya Soap Chemicals Ltd. (2016, November 24). Retrieved from tradenote:
http://keyasoapchemicalsltd.tradenote.net/

West, D., Ford, J., & Ibrahim, E. (2015). Strategic Marketing: Creating Competitive Advantage, 3rd
Edition. Oxford University Press.

World famous Japanese Cow beauty soap brand enters BD market. (2015, August 1). Retrieved from daily
sun: http://www.daily-sun.com/printversion/details/63199/World-famous-Japanese-Cow-beauty-
soap-brand-enters-BD-market-

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