EXTERNAL AND INTERNAL FACTORS

The external and internal factors in a company’s marketing environment form its strengths,
weaknesses, opportunities and threats. a company has control over its internal environment
which consists of the company, suppliers, consumers, marketing intermediaries, competitors and
public. So, any advantage that a company gains by controlling any of these factors is considered
as its strength. Similarly, failure to control any one of these factors results in a weakness for the
company.
The external factors facing a company like, demographic factors, technological factors etc.,
cannot be controlled by the company and pose threats as well, as opportunities for the company.
In Safeguard’s marketing environment, its strengths, weaknesses, opportunities and threats are
determined by the following factors:

S WOT ANALYSIS OF SAFEGUARD

STRENGTHS:
 Adequate financial resources
 Product innovation skills
 Acknowledged market leader
 Advertising effectiveness
 Ahead on experience curve

 Adequate Financial resources:

Safegaurd is brand of P&G, so it has strong financial backing, it possess plenty of funds to to
finance its marketing strategies and to bear losses
 Product Innovation Skills:
Innovation skills are being used on optimum level for marketing Safeguard, in the past which has
enable safeguard to introduce many variants and added features to its product line since 1995.

 Acknowledged market leader:

Safeguard is holding the position of successful market leader by acquiring highest market share
in anti-bacterial soap industry which is its biggest strength.

 Advertising Effectiveness:
From past year results, The advertising campaigns launched by Safeguard have been very
effective and have positioned distinguished place in the minds of its consumers.

 Ahead on experience curve:

Safeguard has been the most prior brand of good-quality anti-bacterial soap that was launched in
Pakistan so they are considered to be the pioneer and intiator of health concept.

WEAKNESSES:

 Price

 Price:

The main and the only weakness of Safeguard is its higher prices relative to its competing
products. A 125 grams Safeguard soap bar is available for Rs.21 whereas the same size bar of
lifebuoy is available for Rs.13. s the price factor is considered to be the most critical for
safeguard.

OPPORTUNITIES:

 Serve additional customers

 Enter new market segment
 Diversify into related products

 Serve additional customers:

One of the opportunities for safeguard lies in market penetration which is still yet to be
uncovered. It can serve more customers through market penetration. Safeguard can increase its
market penetration by promoting its use in hospitals and such other places where anti-bacterial
soaps can be used.

 Enter new market segment:

Not only through market penetration safeguard can expand itself by increasing its product line
horizontally. This can be done by modifying anti-bacterial soap into a beauty soap which
promises germ protection and can enter in the beauty soap market.

 Diversity into Related products:

To tap the urban market through new and sophisticated way Safeguard can also introduce a new
product line of liquid cleaners and other related products not only to increase its growth but can
also fulfill the demand for urban market.

THREATS:

 Increasing competition
 Growing bargain power of customers & suppliers

 Increasing competition:
The biggest threats posed to safeguard from the external environment include increasing
competition. Numbers of anti-bacterial soaps have been introduced in the market and they have
been heavily and continually investing on marketing efforts. Safeguard is facing increasing
competition from other anti-bacterial soap brands like lifebuoy, treat and dettol.

Lifebuoy has launched an aggressive promotional campaign against Safeguard by the name of ‘
Lifebuoy Germ busters’ which is based on a similar format as ‘Commander Safeguard
campaign” launched by Safeguard. They have used celebrity endorsement in their campaign with
Inzamam-ul-Haq against Safeguard’s celebrity endorsement of Shahid Afridi. Lifebuoy is
attacking the brand positioning of ‘Commander Safeguard’ by calling it a fake super hero.

 Growing bargain power of suppliers & customers

 With increased influence of supplier over anti-bacterial soaps in the market, another threat
that is posed to safeguard is the growing buying power of its suppliers and customers. As
they have increased available alternatives of anti-bacterial soaps.

P EST ANALYSIS OF SAFEGUARD:

It is very important that an organization considers its environment before beginning the
marketing process. In fact, environmental analysis should be continuous and feed all aspects of
planning. In this regard, PEST analysis for safeguard soap is of pertinent importance. PEST
analysis is important for scanning the environment and look out for possible opportunities and
threats.
Soap is a major consumer market and there is a huge customer demand and potential market
particularly in anti-bacterial segment. The anti-bacterial market segment has grown year on year
by more than 7% due to increased consumer awareness and education on the benefits of anti-
bacterial soaps. As a result, pie is growing bigger every year.
There are some uncontrollable situational factors that are faced by Procter & Gamble and
Safeguard Soap. We would be analyzing all these factors as follows.

Political Factors:
The political situation in Pakistan has been very volatile during the last decade. The country was
facing the drastic changes in the shape of terrorist attack in various cities of the country. Bearing
not only the bomb blasts Pakistan has been hit by financial turmoil in the form of global financial
recession which has in turn the working of government in adverse way. Although government
policies about taxes are very clear and to some what extent are efficiently implemented in case of
multinationals. Government policies regarding economy have been encouraging but due to
recession the economic condition of the country has been badly hit. Constant political instability
has affected the company in terms of building new relations with the government.

Economic Factors:
Economic factors in the country have also not been encouraging in the recent past. Interest rates
on borrowing have gone soaring high in the country. Consequently the rate of unemployment is
also on the rise which adds up to bad economic condition of the government. Inflation has also
increased in the recent past with is another indicator of bad economic condition in the country.
But despite all these factor safeguard has been doing reasonably well in the country for the past
few years.

Socio-cultural Factors:

Though Pakistan is progressing at a very fast pace still the masses of contry has conservative
approach towards new ideas. So for implementing any new and unusual idea or theme in
promotional activities the company has to be very careful to avoid resentment in general
audience since the sociocultural environment of Pakistan is very conservative and any suggestive
usually face lot of negative reactions on part of consumer. Although the people’s perception
about international brands is very promising, this is a great advantage for Safeguard and Procter
& Gamble. Secondly there are two other important factors which must be kept in consideration is
language and perception towards health issues. . Country’s dominant language is Urdu; therefore
Brand’s communication regarding brand and health awareness has got to be in Urdu. Women are
mostly responsible for doing grocery in this part of the world. Therefore, Safeguard’s target
market is very obvious. Due to low literacy rate, awareness regarding environment and health is
not common among the masses of the country. Therefore, it is important for Procter & Gamble to
first create awareness about health and then cash on it.

Technological Factors:
Technology is imperative for competitive advantage, and is a major driver of globalization.
Technology has been on the rise in Pakistan. technology has been producing results in octagonal
dimension.Due to information technology and other technological advancements in the country
has enabled companies to run promotional and advertising campaigns in an entire versatile
fashion. Latest technology has also enables companies to make cost effective products. Due to
advent of latest technologies, the distribution network has been completely revolutionized.

S.M.A.R.T Objectives setting for Safeguard Pakistan

 Increase the antibacterial soap market with a growth of 10% by end 2010 as compared to
7% last year with increased awareness and education such as “sehat and safai” program
and “global hand washing day” on the benefits of using antibacterial soaps.
 Current market share for safeguard Pakistan is 22% (end 2009) Increase the market share
to 30% by end 2010.
 Current Children equity is 60%.Increase the children equity to 70-75% by the end of
2010 through safeguard’s school education programs across Pakistan to instill the
importance of hand washing.
 With the increase in demand increase in production is must. Investment of $2.5 Million
on the existing 7 acre production facility to double the production by end 2010.
 Brand extension with the launch of the 8th variant of safeguard i.e. anti-perspiring soap
for men by end 2010.
 Direct competition with Lifebouy which has a market share of 15%. Bring down their
share to 13% by customer interaction and awareness programs.
 Current target social class is upper-middle and middle class in urban and sub urban areas
of Pakistan. To attract children of lower middle class to adopt safeguard as primary soap
through school awareness programs.
 25% increase in marketing budget to further carry on the commander safeguard campaign
and instill brand loyalty in children which are the main target market.
 Focus more on the penetration strategy by increasing the distributers and sub distributers
from 300 to 400 and using PUSH strategy to increase the reach of products to smaller
cities such as Muzzafarabad, Shahdra, Sukker, Gawadar etc.
 Increase the Rural Deployment force by 25% for exploring new markets for potential
market penetration.
 Increase promotional budget by 15% as a part of PUSH strategy to provide key accounts
such as Al-fatah, HKB, Metro, Makro, Hyperstar to provide better shelf space.
 Increase the price by 1 Rupee to Rs 39.00 (115 gms) and Rs. 27.00 (70 gms) before the
end of fiscal year July 2010 for cost recovery.
 To make safeguard soap a Rs. 3 Billion brand from Rs. 2 Billion brand by the first
quarter of 2011.