PROJECT 2

INTERNATIONAL BUSINESS

SUBMITTED BY:
PINKI BANERJEE 0201MBA061
VEDSHREE CHAVAN 0201MBA028
Satya Prakash 0201MBA032
PROJECT 2 Entering A Foreign Market International Business

DRY SHAMPOO

What is Dry Shampoo?

Dry shampoo is a product to absorb the dirt, oil and grease of your scalp without
washing it. Many people use it to freshen their hair after working out, a humid
commute, extend the life of a blowout, etc. It can also be useful for people with
disabilities who have a hard time taking showers without assistance.

How Does Dry Shampoo Work?

Commercial dry shampoos usually come in a spray bottle. They are made with a
base of alcohol or starch. When you spray the product into your hair, the alcohol
or starch soaks up oil and grease, making it look cleaner.

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PROJECT 2 Entering A Foreign Market International Business

Dry Shampoo vs. Washing Hair

Experts say dry shampoo is great once in a while, but it shouldn’t be a full-time
substitute for washing your hair with water. You can consider dry shampoo to be
more of a hair freshener than a hair cleaner. It does nothing to clean your scalp,
which collects dirt.

Many shampoos help moisturize your hair. If you use only dry shampoo, it can
actually dry out the strands so they’re more likely to break.

Dry shampoo may also leave residue on your scalp. Without regular shampooing
with water, that residue will build up. If you don't clean your scalp and use only
dry shampoo, you can get rashes and inflammation there. You can also get
dandruff if you use dry shampoo too often without properly washing your scalp.

Additionally, shampooing in the shower clears away bacteria and yeast. It can help
you avoid clogged pores in the scalp and washes away styling products.

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PEST ANALYSIS
Political-Legal Factors:
Product safety is a hot topic in the United States. It’s more openly discussed in
the cosmetic segment of the beauty industry since these products are designed
for skin-to-skin contact. A bill called the Personal Care Product Safety Act
allows the FDA to have a more “hands-on” approach to ensuring product safety.
Companies will need to report ingredient statements, recalls, and register
manufacturers.
The US doesn’t have any trade barriers as such for exporting to India. Also, as
the trade relations are quite good between the US and India.

Economic factors:
Unlike many others, the beauty industry is quite resistant to economic
recessions. It even survived the Great Recession of 2008. Sure, customers
became more price conscious, deciding to buy only what they need for survival,
but that’s the thing. Beauty products have become a necessity like eating or
having a roof over their head. People will always feel the need to have shampoo
and soap in their bathroom. But in 2015, The United States’ beauty industry
generated over $56 billion dollars, with hair care leading the way.

The economic stability of the country should also be considered while entering
a new market. Since, the UK has a good economy, entering it would be
beneficial.

Social factors:
The cultural and the social factors include the demographics of the country, the
consumer behaviour, the cultural beliefs of the people, their preferences, etc.
For our product, as the consumers are moving towards a fast lifestyle, it can be
really beneficial to us.

Technological factors:

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The internet really did revolutionize the beauty industry. You can buy almost
any product and get it delivered to your home in a day or two. Technological
factors

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PROJECT 2 Entering A Foreign Market International Business

play an important role in the business especially when it is into another country.
US is a developed country and it has good technological advancements that are
required for business such as good telecommunication facility, transportations,
etc.

The mode of entry chosen is Exporting.

As the product is dry shampoo, the manufacturing is to be done in India as
exporting is easier than other activities such as manufacturing in US. This
makes the production process easier and also the manufacturing costs are lower
due to the readily available ingredients. The exporting is to be done once the
production is completed in India. Exporting to the US includes the trade tariffs
and the taxes that are imposed by the US for the export of the goods.

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Product:

Dry shampoo has 3 main variants of dry shampoo to suit different types of
scalps which comes in different colours; for oily scalp, dry scalp and normal
scalp. The user can choose with respect to their needs. In order to reduce hairfall
and improve the quality of the product, advanced formulations have been used.
Thus, it will be a solution for hair care. The USP of the product is that it cleans
the hair in shorter time when compared to the existing shampoos in the industry.
The product has been packaged in such a way that it ca n be easily used when
washing hair.

Place:

The product has been manufactured in India. It will be distributed and will be
available in most of the grocery stores, major retail shops, cosmetic shops and
drug stores of US. In order to meet the demands of online customers, it will be
available in all the major e-commerce sites such as Amazon.

Pricing

Being the first player in the market, we have a substantial competitor edge in the
market. It’s strange how consumers use price as an indicator of all sorts of
factors, especially when they are in unfamiliar markets. Consumers might
practice a decision avoidance approach when buying products in a new market.
Based on this we choose the method of Psychological pricing, where price in an
indication of quality and feature.

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Promotion
Though the product is for the babies and children, our target customers will be
parents, especially mothers. The product will be positioned on an “Safe and cry
free” value proposition. This will allow for differentiating the product based on
features and benefits. The product advertisement and sales promotion are the
two keys ways to reach the customers. Product placement in the stores also
plays an important role in branding the product. The benefits of the product
should be stated explicitly.

From the above analysis, it can be said that the US market will be a good choice
to enter due to the technological advancements, good economy and growing
market of dry shampoo. Also, since the trade relations are good, it’ll be really
beneficial to enter the US market for dry shampoo.

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