PRICE ELASTICITY ANALYSIS OF WOMEN SKIN CARE CATEGORY IN MINIMARKET CHANNEL AND ITS CORRELATION WITH SHOPPER DECISION TREE

• Main Author: Febrina, Fidiyanti
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/57666
• Institution: Institut Teknologi Bandung

Women skin care, a category that a few years ago was considered as luxury, is currently perceive as routine product and experiencing a rapid increase in the market, and even estimated that it will continue to grow until 2025. In Indonesia, there are several distribution channels for women skin care category: traditional trade, modern trade (minimarket, hypermarket, and supermarket), drug stores, department stores, and e-commerce. Currently, e-commerce is the channel with the highest growth and this had been predicted from the start of the pandemic. What interesting was the minimarket channel, which turned out to be one of the stable channels during the pandemic. The location of the store which is close to residential areas, large businesses size, and wide distribution, are the aspects that are able to attract the attention of FMCG companies in Indonesia to compete to be the best choice for consumers. One way that is always thought to be the most effective is to provide discounted promotions to consumers. The greater the number and the deeper the promotion ratio can result in low profits if the increase in the sell out is smaller than the cost of the promotion. Therefore, it is necessary to have an in-depth understanding of the changes in the quantity of product sell out in women skin care category to promotions and the order of shopper decision tree of women skin care products. The research method used in this study was carried out from a quantitative perspective through price elasticity analysis in each sub-category of women skin care, as well as from a qualitative perspective to determine the priority order of consumers in purchasing decisions for women skin care products at minimarkets through online questionnaires, field surveys, and short interviews with women skin care product buyers. The result of quantitative research shows that there are only 3 sub-categories out of a total of 6 sub-categories those have been analyzed, indicating that these sub-categories are elastic to price changes during promotions. These 3 sub-categories can result in a more significant increase in revenue than other sub-categories when there is a promotion. The 3 sub-categories are facial wash, micellar water, and serum. Meanwhile, the result of the online questionnaire shows that the promotion aspect is not on first or second priority when consumers are choosing women skin care products in minimarket. Product efficacy and brand name are the two main priorities. Like wise with the results of the author's brief interview with shoppers of women skin care products at minimarkets. From this, it can be concluded that not all product sales in the women skin care sub-category can be effectively promoted through promotions alone, but it must still be communicated more widely about the advantages of products and brand names.