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                     Bachelor of Business
                   (Business Management)


                            MKTG1052
                      Buyer Behaviour
                                   BBMFT
                   Lecturer: Patricia Lui Wai Yin



Done by:
Tan Sim Kiat, Eric, 3188844, S8535790E
Liao Chengyu, 3189143, S8503174J
Wee Song Lee 3189118, S8529991C
Chua Kim Chan, Steve, 3178996, S8502502C
Tay Boon Hao, Roderic, 3188934, S8402258F
Kor Wee Kiat, 3179364. 8400581I
                                                      Words Count: 5187




Buyers Behaviour                     Page 1                   MKTG1052
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                                 Table of Contents


Item                                                     Page


i) Cover Page                                               1

ii) Table of Contents                                       2

iii) Introduction                                           3


1) Market                                                   3, 4


2) Competitor                                               4, 5


3) Identification of Target Market                          5–9
       3.1) Primary Target Segments                         5-9
       3.2) Potential Target Segments                       9


4) External Influences                                      11- 13
       4.1) Culture and Subculture                          11
       4.2) Demographics                                    11, 12
       4.3) Group Influence                                 12, 13


5) Internal Influences
       5.1) Needs and Motives                               13, 14
       5.2) Perception                                      14, 15
       5.3) Learning                                        15, 16
       5.4) Lifestyle                                       16, 17




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6) Consumer Decision Making Processes
      6.1) Information                                      17
      6.2) Consumers evaluative criteria                    17, 18
      6.3) Retail Outlet Selection                          18
      6.4) Post Purchase Behaviour                          18
      6.5) Product Disposal                                 18, 19
      6.6) Loyalty                                          19


7) Marketing Strategy                                       19 - 26


8) Recommendations and Evaluation                           26 -


9) Conclusion                                               30


10) References                                              31, 32


11) Appendices                                              33 - 37




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Introduction


Electronic Healthcare Products has gained popularity for the working adults and elderly
in recent years as consumers seek ways to relax and take care of their body. This report
aims to critically analyse consumers‟ behaviour with relations to OSIM‟s latest uPAPA
Hug with comparison to their leading competitor, OTO‟s Power Tap PT 708.


1. Market


Market Size and Market Share


Singapore has a population of estimate 4.8 million, of which estimate 3.6 million are over
age 25 (Singstat 2009), reflecting the major group of consumers and the market size for
electronic healthcare products in Singapore. As there is limited sales information for
electronic healthcare products in Singapore, the market share for OSIM is
undeterminable. However OSIM believed that they are the market leader based on its
latest survey done by Synovate (Brand OSIM 2009).


OSIM’s product range and principal products


OSIM provides a variety of electronic-products that are inter-related to health and body
care. Other electronic products such as vacuum cleaners are introduced and they served
as complementary products as these products are designed with the improvement of
lifestyle (such as better well being of health) in mind, such as the sanitising function for
the vacuum cleaner. Its principal products comprise of the various electronic massagers
such as the uDream, a massaging chair and also uPAPA Hug (OSIM 2009a), the focus of
this report.




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Focus on OSIM uPAPA Hug

uPAPA Hug was a innovative step up creation of snug-fit from the older product of
uPAPA which has been in the market for approximately half a year. The focus on uPAPA
Hug is still ongoing on their main website which proves that OSIM is still active in
pushing the product to their consumers, informing them of the latest version that is
relatively different from the older version of uPAPA, with reviews and comments at their
websites by current users, it allows inquisitive and potential consumers to understand
how uPAPA Hug can also help them with their back relief.


Product Life Cycle

The OSIM uPAPA Hug is considered to be still in the growth stage of the product life
cycle. uPAPA back massagers are already a known product maintained in the healthy
lifestyle market with uPAPA Hug as a new design of the uPAPA with a competitive
price. uPAPA Hug is already a recognised product with customers giving constant
positive review.




2. Competitors


Major competitors marketing similar product as OSIM within the electronic health care
category is IPS Brothers Enterprise Pte Ltd‟s OTO and OWELL BodyCare Pte Ltd. In
terms of establishing their local presence, both OTO and OWELL currently operates 17
and 8 outlets respectively, while OSIM has 37 outlets island wide. Base on these figures,
OSIM is perceived as being more established than the former 2 companies. Moreover,
although the companies are seemed to serve the same niche market, they differentiate
themselves in terms of product offering; Both OTO and OWELL concentrate on its
product functionality and features with the latter providing a much limited range of
product offering whereas OSIM focus on innovating its user friendliness, designs and
quality.




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Furthermore, the existence of other indirect competitors poses a substantial threat to
OSIM‟s market position. These include numerous spa treatment centres, registered and
unregistered massage parlours which altogether aim provide customized services suited
to each individual needs. These services acts as a form of substitutes towards OSIM
which offers limited functions to each individual needs.




3. Identification of Target Markets


3.1 Primary Target Segments


Both OSIM uPAPA Hug and OTO PowerTap have identical design and shared similar
purpose of massaging and release aching stress targeting in the shoulder region. Both
products also demonstrated the flexibility to massage other areas such as the back and the
thighs. However with their marketing antics and branding, uPAPA Hug and PowerTap
may have slightly different competitive primary markets.


Demographics – OSIM uPAPA HUG


  Demographic     OSIM uPAPA Hug                                Remarks

 Age Group        25-35                It focuses on providing a relaxing experience as well as
                  (Generation Y) &     a stress remover which young working adults are
                  50 years old         facing in the fast paced lifestyle. As the society
                  (Generation X)       advances, young adults are often suffering from muscle
                  onwards              discomfort due to their work nature (such as being
                                       deskbound for a long period of time), thus enhancing
                                       OSIM UPAPA Hug attractiveness. In addition, OSIM
                                       UPAPA Hug was also advertised as a perfect present
                                       for the elders.




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Gender          Male and female   As seen on their advertisements, a young lady with
                                  toned figure was portrayed. It displayed the „gentle‟
                                  side of the product, symbolising that it is suitable even
                                  for female usage. The male models playing the drums
                                  symbolised that the product has a „male dominant side‟
                                  too. OSIM attempted to attract such consumer by
                                  emphasising that UPAPA Hug not only can be used on
                                  the neck and shoulder, it can also be used to target
                                  buttock and thigh area.


Income level    Middle-high       People with spending power and are particular on
                income level      enhancing their lifestyle.




Demographics OTO PowerTap PT 708


  Demographic      OTO PowerTap                             Remarks

Age Group       45 years old      Older people tend to suffer from muscle aches more
                onwards           often compared to the youngsters. OTO focus more on
                                  the ability to heal and cure “elderly” problems, such as
                                  body ach. (seen through their advertisement- a Old
                                  celebrity telling her experience after the used of the
                                  PowerTap. As mentioned by their slogan: Bodycare)


Gender          Male and female   The targeted market resemblance a mixture of both
                                  genders as their focus is on elders in general.


Income level    Middle-high       People who are more educated and are willing to spend
                income level      the money to purchase the equipment



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Psychographics


             OSIM uPAPA Hug                            OTO PowerTap
Attitude     By having a portable and stylish          It has proven testimonial from users
             device at home, it saves space yet        that the products does help to solve
             enables the consumer to enjoy a great     aching problems. The health care
             massage to relax and release stress       products provide the consumers with
             from work. Moreover it is more            value for money as it can be used for
             convenience and cost saving               other parts of the body.
             compared to going for regular
             massage session


Values       UPAPA Hug consist of several              The PowerTap on the other hand
             functions and usage method to provide focuses on providing percussive
             total body relief to resolve stiffness    rhythm improves blood circulation
             and muscle aches arising from daily       and relaxes tense muscles. They
             routines. It emphasize on stress          emphasis on improving lymphatic
             removal and body energising               flow, immune system and nerve
             (tangible). It also allows one to feel    function, thus helping you sleep better,
             good/relaxed and gain a sense of          providing a more customised
             satisfaction (intangible). More are       experiences by having 8 intensity
             pursuing it, as it is convenient          levels and 32 rhythmic cycles to cater
             (compact and portable) for personal       to individual needs
             and family usage.


Activities   Consumers may use the products at         Consumers may use it as a solution to
and          work or home at their convenience         a problem that they are facing
interests    timing. As for the ladies it serve as a   currently. They are targeting elderly
             alternative to a healthy slimming         who usually sits around for long hours
             session.                                  and are experiencing from numbness
                                                       due to low blood circulation.


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Media         The products have been advertised on      The products have been advertised
patterns      the website and daily media such as       widely on the website and daily media
              newspapers, public transports and         such as newspapers and magazine.
              magazines. Occasionally they hold         The main difference between OTO
              road shows at town area to capture the    and OSIM advertising media pattern
              attentions of working adults in the       is, OTO advertise on radio FM such as
              regions.                                  958 whose audiences are mainly age
                                                        50 years old and above.
Usage         Consumers can use it freely without       Consumers can use it daily to improve
rates         having to worry about the availability    their overall well-being. Alternatively,
              of the product/service after purchase.    use it when they are experiencing
              A consumers‟ testimonial commented        from body numbness or pain due to
              that such massaging equipment is          low blood circulation.
              good and he uses it 3 times a day
              during the intervals of his physical
              demanding job (e.g. driving cab for
              long hours) to help him relax better
              (Purba 2009).




Behavioural


Deal proneness is a function of both consumers‟ buying behaviour and the frequency
with which a given brand is sold on a deal basis (Frederick, 1965). OSIM leveraged on
the usage of powerful marketing strategies at the right time to promote their products. For
instance, OSIM advertised their uPAPA Hug product as an ideal father‟s day gift, as it
simply means give your father (PAPA) a Hug. Being Asia‟s number 1 most preferred
healthy lifestyle brand, OSIM‟s uPAPA Hug tend to attract consumers who are more
brand conscious and susceptible to marketing influences (OSIM, 2009)(AppendixA).
Whereas, OTO‟s PowerTap attracts consumers who are more performance orientated. It


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offers 32 functions and 8 speeds manufactured in Korea as compared to uPAPA Hug‟s 4
functions and only 2 speeds manufactured in China (OTO BodyCare, 2009)(Appendix
B).


3.2 Potential market Segment for OSIM


Currently OSIM target audience are identified as 2 major groups
      1. Young working adults 25+ to 35 (Generation Y)
      2.   Elderly that are in their 50s+ (Generation X)


Potential new markets will be to extend their demographics and identify characteristics
such as newly weds and new parents. Thus OSIM can leverage on these new target
segments as;


          Increased stress and workload from the additional family member
          Change in purchasing pattern, males is more willing to get products for their wife
           and family.
          Socially conscious about their image, especially females after childbirth.
          Particular about having a healthy and balance lifestyle
          More females entering the workforce and have the spending power as compared
           to the past
          Health become less of a luxury and more of a necessity issues


Moreover OSIM is perceived as a lifestyle product in the eyes of the consumer; OSIM
can leverage on that perspective and promote it as being cool to be seen as unique by
having OSIM products at home, as compared to the OTO brand.


The following sections will analyse how external and internal influences impact upon the
targeted segment that consist of young working adults (Generation Y) aging from 25-35.




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4. External Influences


4.1 Culture and Subculture


Singapore is a multiracial country with the main population being Chinese; certain key
oriental values (other-oriented values) are being abided such as filial piety and
collectivism. uPAPA Hug served as an ideal gift for the Generation Y to their parents or
to friends, which will boost sales during festive seasons and celebrations.


Even though oriental values are being preserved, the western cultures also heavily
influence Singapore as globalisation takes place. Generation Y are being more
technological savvy and often relied on technology to perform their daily tasks. Instead of
visiting a traditional massage parlour, uPAPA Hug offers the ease of massage anytime
anywhere at an affordable price, another key issue as the pace of life of Singaporeans gets
heavier and faster. Generation Y also exhibits self-oriented values such as seeking leisure
and sensual gratification as they are getting more work stress.


Being a highly competitive society, Singapore indicated traits of a status-oriented society
and established brand names are being sought after by the rich and famous. Being a
market leader in the electronic healthcare products, OSIM is able to carry its brand name
and reputation of quality and style to the product, enhancing the value consumers
perceived.


4.2 Demographics


Age and Income


The Generation Y represents the large dynamic workforce of Singapore. As discussed,
Singapore‟s Generation Y is increasingly becoming knowledge workers, which in turn
increased their income that is directly related to their purchasing power. With the




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discussed, its shows that majority of the Generation Y are capable of purchasing and own
a unit of uPAPA Hug.


Gender


The percentage of males and females in Singapore are 49.5% and 50.5% respectively
(Singapore Statistics 2008). Gender has been a long-established segmentation variable,
not only in the sense of there being products for men or women, but rather that
traditionally most consumer goods were bought by women (Evans, Mountinho & Raaij
1996). Women tend to be more modern and are more willing to spend on relaxation and
shopping while men tend to splurge on technology gadgets. uPAPA Hug compresses of
relaxation and stress relief with the latest technology in build, which is suitable for both
genders.


Socioeconomic


The population in the 21st Century is mostly educated and has at least 94.2% literacy rate
(Singapore Statistics 2008). With the above discussion, it signifies that the Generation Y
today is more knowledgeable and tends to make more high-involvement purchase. Thus
the usage of advertisements for uPAPA Hug to educate and attract this segment (as it can
be easily communicated) is critical in its marketing campaign.


4.3 Group influence


Reference Group influences the control that a group may have over an individual. It
affects the product type/category/brand used; the medium which consumers communicate
and learn from each other. By understanding how groups think, it enables us to
understand consumer behaviour better.


Informational influence occurs when an individual uses the behaviours/opinions of
reference group members as potentially useful pieces of information. One example would



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be online forums (e.g. hardwarezone.com). Young working adults frequent such sources
to search for the information they required, so as to get the best deal available. Many
senior members of reliable sources (such as hardwarezone forum) vouched for OSIM
uPAPA Hug, as they had good experience with it. With the positive comments to boost
consumers‟ confidence (Hardwarezone 2009), consumer will have an increase in
tendency to purchasing it over other brand similar product (e.g. OTO PowerTap).


Furthermore in an independent survey conducted by international market research
company, Synovate, and supported by International Enterprise Singapore (IE Singapore),
OSIM came up as the Number 1 Healthy Lifestyle products brand in consumers' mind
across Asia (Brand OSIM 2009). Based on this noteworthy information, consumers
(young working adults) would be enticed to purchase OSIM brand products over other
brands.




5. Internal Influences


5.1 Needs and Motives


The first factor affecting consumers‟ purchase behaviour is motives. A motive is often
triggered by the perception of a discrepancy between a desired state and an actual state
that is both sufficient to arouse behaviours and relatively important to an individual.


Maslow‟s hierarchy of needs is a theory designed to account for most human behaviour,
depicting a natural progression from physiological needs to high/self-actualisation needs
(Maslow 2000). We would see how purchasing and/or using the product are fulfilling
social and self-esteem needs of the targeted market segment.


Young working adults nowadays often seek good health to meet and overcome the
challenges in their life, especially in their work, because of the fast paced society. They
have longer hours and are demanded the flexibility and agility to meet with demands,



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much more than compared to the past. This multiplied their stress level and lessens the
time for them to relax. Hence, it creates a motive/desire in them for all these issues to be
relieved.


uPAPA Hug is launched in a way that satisfies the above motives by helping young
working adults to relieve stress and tensions by means of loosening their muscle tissues
to improve blood circulation. This enabled them to fulfil their desire for relaxation and to
feel more energized at work, to readily face and overcome any future work challenges.


Purchasing the product enhances the good health and well-being of this target segment.
As such, their overall image and work productivity is always at the peak, thereby
fulfilling their esteem needs. Also, since the product is reflected upon positively in the
minds of young working adults, it is likely the product would be purchased as a gift to
their love ones, or be given as a gift by their love ones, thereby fulfilling the target
segment‟s social needs.


5.2 Perception


Perception is a critical part of the human brain‟s information processing system, which is
triggered by consumers‟ 5 senses. By understanding the information-processing model,
we will be able to influence consumers in their decision making of a product.


Exposure


OSIM uPaPa Hug has been advertised through various mediums such as TV, radio
commercials, newspaper and posters/boards on public transports. The advertisements are
often presented in full colour and are of substantial size (Appendix C, D). This initiative
will ensure that uPaPa Hug stands out among the rest and sub-consciously stimulate the
consumers‟ sight to project the product in the consumer‟s brain.




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Attention


OSIM holds various road shows at major shopping malls (Appendix C) to inform public
of their new product launch and celebrity endorsement are often involved to capture the
attention of the crowds. OSIM advertisements focused on presentation and usage of
innovative technology, such as eastern acupressure points theory and western sports
science.


The positioning of a drum beside the uPaPa Hug draws an attention in relating the
effectiveness and power of the product. The simple and straight forward presentations of
a well tone lady using the uPaPa Hug helps to draw the readers in visualising the usage of
the massager and individuals will naturally be grazing by the smooth and soft colours
used in uPaPa‟s advertisement as the visual images are the richest and most stimulating.
A short 30 seconds commercial of uPaPa Hug in the radio or television also increased
the attention of the consumers by focusing on the main usage of the product (YouTube
2009a). The compressed messages will stimulate the brain in processing the product in
the consumers‟ mind.


Interpretation


The advertisement creates a relaxing and relieving atmosphere after a long tiring day.
Individuals will relate the power and strength of the drum to OSIM uPaPa Hug (YouTube
2009a) which delivers powerful punch to provide soothing and effective relief for neck
and shoulder and other body areas.


5.3 Learning


Marketers of OSIM may use operant conditioning to help our selected potential target
segment (young working adults) to learn more about UPAPA Hug. In this application of
learning theory, it proposed that consumers require to be engaged in an initial trial of the
product before the product can become rewarding for them. Therefore, marketers often



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encourage consumers to engage in that first trial experience by using different appealing
approaches.
One useful approach would be for OSIM to organise marketing campaigns in the Central
Business District (CBD) area, where the majority of the target segment are located. In
doing so, OSIM marketers can capture the attention of these people more successfully,
and hence providing them with the opportunity to test out the effectiveness of uPAPA
Hug. The target segment would have little resistance to trial the product, because it is
perceived as an ideal way for them to relax during their break time (desired response). To
make it even more enticing; it is free of charge. During the trial out session, the young
working adults are able to gain real life experience and a better knowledge of how the
product functions.


As such, if the product is found to be pleasurable (positive reinforcement) , the chances
of them repeating the behaviour will be increased in the form of purchasing it. Therefore
in buyer behaviour context, the consumers‟ positive conditioned response to the try out
has reinforced them to purchase the product, so as to enjoy the product continuously
without limitations.


5.4 Lifestyle


Generation Y have a preference towards western culture which adopts a work life balance
lifestyle due to their exposure to western culture since young, They are identified by Roy
Morgan valve segment as the young optimism category that comprises of young
professionals who are career oriented and ambitious. uPAPA Hug particularly appeal to
consumers with such lifestyle as individuals utilise it for relaxation after their stressful
schedules and OSIM‟s brand name symbolises their individual identity.


However uPAPA Hug can also be associated with other diversified forms of lifestyles. As
abovementioned, Generation Y are status oriented and are heavily influenced by others
approval and opinion. Consumers influenced by such lifestyle tend to have high regards
for social and esteem needs, and feels the need to be associated with „high-class‟ status.



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Supported by VAL‟s system, innovators group, such consumers purchase UPAPA Hug as
it reflects their “high class” image. For that reason OSIM attempted to align their
customers‟ values to their own values and had portrait themselves to be a lifestyle brand,
which can be see through their slogan -inspiring life.


Consumers of UPAPA Hug also exhibit characteristic that strongly supports a healthy
lifestyle as one of their priorities, inline with the lifestyle pursued by most consumers that
are age 50 years old and above (Generation X); closely resembled the thinkers and
believers group under the VALS segment. These strongly illustrate that uPAPA Hug is a
solution for stress relieves for people experiencing different lifestyles.




6. Consumer decision making processes:


6.1 Information


Potential consumers will sought after information such as 1) the existence of similar
product from various brand, 2) the performance level of each brand and 3) characteristics
of the product under each brand. A consumer typically will undergo high level of
purchase involvement and undertake extended decision-making in the purchase of
uPAPA Hug because it involves a complex evaluation of multiple alternatives (such as
purchase of an electronic-massage chair or other traditional options versus uPAPA Hug)
and it involves some form of risk (financial and personal). As OSIM is the market leader
for electronic healthcare products, the brand presents a high possibility to be in
consumers‟ evoked set upon decision-making.


6.2 Consumers evaluative criteria


Consumers often evaluate electronic-health care products based on awards won (design
award etc.) and certifications (such as ISO certification) of the products. The main
evaluative criterion for UPAPA Hug includes 1) functionality, the basis of solution for



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consumers‟ problem, 2) price and 3) brand, whereby both served as surrogate indicators
as the higher price usually indicates a higher quality and leading brands (such as OSIM)
are associate with quality as it is well known for a wide range of high quality products.


6.3 Retail outlet selection


uPAPA Hug‟s is well known as OSIM has a strong brand name in its reputation for
quality lifestyle electronic health-care products. This exhibits that consumers shopping
for this product will seek for the 1) brand and follow which the 2) outlet to make their
purchase as they will seek for a brand they trust first, after which select an outlet that is of
relevance to the consumer (such as outlet that is most convenient or friendliest staff).


6.4 Post Purchase Behaviour

After the purchase of uPAPA Hug, some consumers might face post-purchase dissonance
such as faulty components or unsatisfactory results over a period of time. As it involves a
high level of purchase involvement, a high degree of commitment and importance is
attached, implying that the magnitude and probability of dissonance occurring is high.


To reduce the likelihood of post-purchase dissonance, OSIM can tailor its advertisements
for recent purchasers such as using positive statistics (such as most sought after) or
testimonials from satisfied customers. Also, post-purchase surveys and follow-ups can
reassure them that they have made a wise purchase. Lastly, extended warranties can be
offered to illustrate the confidence of quality in the product by OSIM.


6.5 Product Disposal


Consumers have three alternatives in disposing products; keeping it or convert it into new
use, get rid of it permanently or temporarily, and giving it to other people or selling it.
Study had shown that a higher value product would result in consumers to choose a




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disposal method that will allow some returns compare to a lower value product (Mowen
& Minor, 2001).


uPaPa Hug can be considered costly to the majority of its target segment (a mixture of
low and middle income mix) and the components maybe hard to disintegrate (compound
materials with electronic chips). Therefore when a disposal occurs, consumer may choose
to give it away to family and friends or donations or sell it to Cash Converters for some
cash returns instead of simple disposal.


6.6 Loyalty


The potential segments may have different purchasing power and segments with lower
purchasing power might choose for a cheaper alternative with similar features.


Brand-loyal purchases should be encouraged, as this initiative will increase the brand‟s
popularity and provides consumers with a feel of superiority. Newsletter can be sent to
consumers to create awareness and ensure customer‟s there is little or none post purchase
dissonance through follow up calls to understand if the products are satisfactory. OSIM
can also increase brand recognition via fulfilling corporate social responsibility and
donate to charitable organisation for every product purchased. Consumers who purchase
products from OSIM will indirectly form an attachment with the brand and will stay loyal
to them.




7. Marketing Strategy


The following section shall examine the marketing approach engaged by uPAPA Hug
and PowerTap to determine its market position and its success.




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Marketing
                               OSIM (uPaPa Hug)             OTO (Power Tap PT-708)
Mix
PRODUCT        Specification     1. Thermal enabled           1. Thermal enabled
                                    (situated at the rear        (situated at both front
                                    portion only)                and rear) massager
                                    massager.                    with ventilation.
                                 2. 4 rhythmic                2. 32 Unique rhythmic
                                    massage cycles and           massage cycles and 9
                                    2 different intensity        different intensity
                                    levels of tapping            levels of tapping
                                    massage.                     massage.
                                 3. Product made in           3. Product made in
                                    China.                       Korea.




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               Support         1. 1 Year Warranty      1. 1 Year Warranty
                               2. 7 days 1 – for – 1   2. 7 days 1 – for – 1
                                  exchange policy         exchange policy for
                                  for any                 any unserviceable
                                  unserviceable           units.
                                  units.               3. Customers are able to
                               3. Customers are able      return faulty product
                                  to return faulty        at any available retail
                                  product at any          outlets.
                                  available retail
                                  outlets.




PRICE          Product Price   1. $238                 1. $298
                                  (promotional         2. Enable credit card
                                  bundle excluded)        holders to pay by
                               2. Enable credit card      installments *only
                                  holders to pay by       with every $500 and
                                  installments.           above purchases.




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PROMOTION      Advertising     1. Advertising using     1. Advertising using TV
                                  TV advertisement,        advertisement, flyers
                                  flyers and banners.      and banners.
                               2. OSIM blog             2. Elder Celebrity is
                               3. Road shows &             engaged.
                                  Newsletters           3. Road shows &
                               4. Health talk forums.      Newsletters


               Promotional     1. Bundle promotions     1. Free OTO ear
               offers             with other OSIM          thermometer or Neck
                                  products at a lower      Snuggler (both worth
                                  price. (i.e.             $68 each), plus
                                  uSqueeze Foot            Sweet Spot S-100
                                  massager [save           (worth $18) with
                                  $78] or uPaPa ).         every purchase.




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PLACE                                 1. Available in 37            1. Available in 17
                                          shopping center               shopping center
                                          island wide (both             island wide (both
                                          major shopping                major shopping
                                          centers and                   centers and
                                          residential malls).           residential malls).
                                      2. Internet website           2. Website with product
                                          with product                  information.
                                          review and                3. Retail outlets with
                                          information. Also             less vibrant color
                                          equipped with                 themes such as grey
                                          online shopping               and white.
                                          option.
                                      3. Retail outlets
                                          brightly furnished
                                          with vibrant lime
                                          and white color
                                          themes.




Product


Both uPAPA Hug and PowerTap are creative innovations designed to aid their targeted
segments to better their lifestyles. uPAPA Hug is positioned as a lifestyle product to its
target segment (Generation X and Y) whereas PowerTap has positioned itself as a
healthcare product to its target segment (Generation X). Inline with its positioning as a
healthy lifestyle product innovator, OSIM sought to continuously innovate its brand,



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designs, technologies and concepts; the main appeal to Generation Y. Whereas
Generation X are known for their conservative and traditional cultures and they focused
heavily on capabilities over designs, thus PowerTap offered more functions and has air
ventilation pockets that prevents the system from overheating.


However, more functions require a higher educated individual or further instructions and
product training to use the product efficiently. Thus PowerTap might be perceived as a
complex product with difficulty in usage, forming less appeal towards the Generation X
who might appreciate the simpler and easy-to-use uPaPa Hug. This might also further
discourage those who wish to purchase Power Tap product for their elderly parents or are
less technology savvy. These characteristics implied that uPAPA Hug‟s diffusion process
would be smoother as compared to the Power Tap as uPAPA Hug‟s acceptance level is
higher.


Price


As mentioned, price is an important evaluative criterion when consumers seek to
purchase such electronic healthcare products. In comparison, uPapa Hug is selling at $60
cheaper relative to Power Tap which is critically important as Singaporeans sought
tighten their wallets during the current recession which has crippled their financial
capacity to sustain a luxurious lifestyle. This also implies that a price reduction or a
discount will enhance the desirability of uPAPA Hug. However, noted from needs and
motives, this product is a pathway to seek esteem and social needs, if the price reduction
was too huge, it will be viewed as a „lower-class‟ product as price are often used as a
surrogate indicator for quality and status with relations to the purchase.


To aid consumers with lower financial capabilities, OSIM allows its consumers to pay by
credit card installments for all its products whereas OTO requires a minimum $500
purchase before its installment scheme could be activated. OSIM stands advantageous in
this area as consumers are incentives towards such readily installment schemes which
eases them financially.



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Promotion


In promoting uPAPA and Power Tap, both companies have communicated different
values to their individual targeted segment. As mentioned, both products are positioned
differently; uPAPA focused on lifestyle and vibrancy, thus the engagement of bright
colours and young female model in their various modes of advertisements (Appendix A,
C) to communicate the value of importance of a quality lifestyle to their target segment of
Generation Y. However, Power Tap engaged in dull colors and older models for their
advertisements (YouTube, 2009b)(Appendix B, C) as their goal is to communicate the
benefits of PowerTap to their target segment of Generation X and such materials can
relates to them better.


Both companies engaged similar marketing channels such as advertising through the
Internet, magazines, flyers, TV advertisements, road shows and sporting events. In
addition OSIM also engaged in other forms of marketing campaigns; Health talks were
conducted by OSIM, in hospitals to promote and educate patients and visitors the benefits
of using OSIM products such as the uPapa Hug (OSIM 2009b). This aids OSIM to
promote its products more efficiently and positively; especially to those who might resist
new technologies (i.e. elderly). The endorsement by reviewers and hospitals could
provide the „seal of approval‟ that consumers will accept as indicative of quality.


Furthermore, point of purchase displays such as promotional board is utilised (Appendix
D), which displayed product information, pricing, bundles and instalments plans. This
form of advertising, increases the possibility of spillover sales; the sale of other products
such as OSIM uSqueeze. For bundle promotions, consumers are able to purchase
complementary equipments at a discounted price coupled with instalments options;
whereas OTO‟s free gifts are subjected to availability and consumers are required to
perceive it as something beneficiary rather than an inferior gift that might reduce OTO‟s
efforts of projecting high quality image.




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Place


Both products have comparable channels of distribution despite their difference in
positioning and difference in focus of target segment identified.


The traditional brick and mortar business format that utilises a shop front for consumers
to browse physical products are strongly engaged by both companies for both target
segments (Generation X and Y) by both companies. However, OSIM possessed
additional 20 outlets that served as a competitive advantage as consumers may perceive
OSIM to be more popular. It can also serve as a psychological advantage as consumers
may perceive it as a convenient attribute regardless of purchasing or servicing uPAPA
Hug.


In addition, as Generation Y increasingly becoming more “time poor” due to their hectic
lifestyle, there has been an increasing trend towards online shopping. OSIM‟s website
offers an addition channel for distribution compared to OTO; online shopping that is
inline with the hectic professional lifestyles of Generation Y identified previously.


Marketing Strategy


In examining the marketing mix engaged by both products, they have effectively utilise
their marketing mix to formulate marketing strategies, such as OSIM‟s preference
strategy with information provided at point of sales as it is under consumers‟ evoked set,
(Appendix A, D) to affirm their market position and these images have been embedded
into consumers beliefs, influencing the individual‟s purchasing decision process.


8. Evaluations and Recommendations


With review to the above accessed marketing mix for uPAPA Hug and PowerTap, we
can conclude that OSIM has a comparative advantage in Price, Promotion and Place
whereas PowerTap has emerged stronger in the Product category. With this conclusion



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we can determine that OSIM can better exert influence on consumer decisions upon the
purchase situation.


Although product is key in every consumer‟s purchase, consumer behaviour largely
depends on other appeals more often (such as emotional appeal). Price is an important
evaluation criterion and equipped with a clever usage of colours and details compared to
OTO (to capture the attention of consumers and influencing their perception) (Appendix
C), OSIM will be presented under the consumers‟ evoked set, contributing to the overall
success of the uPAPA Hug.


The following recommendations are made in the attempt to better influence consumer‟s
purchase decisions, to ensure the continuity of success of uPAPA Hug.


Product Positioning


OSIM should maintain its positioning strategy for uPAPA Hug as an innovator. This is
strongly related to its vision, „inspire life‟ by improving the product through continuous
improvement in its employee and work processes. Moreover, by being innovative, OSIM
engages in a differentiation strategy that implies that competitors might find it hard to
imitate and compete against, and consumers will perceive uPAPA Hug as „unique‟. Thus
defending OSIM leading position within the market.



Product (goods and services) Enhancements



The current uPaPa Hug comes with a 2-meter wire and may be inconvenient if there is no
power plugs around. OSIM could develop one with portable chargeable battery to
facilitate the movement and usage of uPaPa for the consumers. As the product is
targeting at General Y consumers, OSIM can improve the physical appearance of uPaPA
by having a wide range of color skins for consumers to choose from. This will blend in
with their home decorations and create a unique style of theirs. Beside the color



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enhancement, OSIM can build in a mp3 player with uPaPa so that it can serve two
functions of entertainment and relaxation for consumers while consuming the product.


Improved Marketing Communications


OSIM could amend its current media advertisement to emphasize its focus on quality
lifestyle concept. This could include a scene where working adults and their parents using
the Upapa Hug thus allowing consumers to appreciate better the usefulness of uPapa Hug
better than their current usage of theme for uPAPA Hug.

In addition, uSqueeze foot reflexology units are currently placed in several major
locations such as shopping malls and the airport for public usage. This „shaping‟ process
emphasize on inducing partial positive response from consumers by allowing them to test
on OSIM‟s products, leading to final desired response such as purchasing OSIM
products. OSIM should employ similar tactics to its uPapa Hug by installing uPapa
sampling units in populated areas such as shopping malls, cafes (i.e. Starbuc). However,
it should be noted that these sampling test units should be functional at all times, as a
non-functional unit would generate negative consumer feedback, leading to negative
consequences such as poorer sales and reputation. Other similar „shaping‟ techniques
could also include OSIM renting its uPapa Hug to major consumers (such as B2B) at a
low fee, which helps build a closer relationship with its potential segment and also
advocates OSIM‟s quality standard through public endorsement.

Lastly, OSIM could alias with telecommunication companies and its retailers to engage
in location-based advertising (LBA) SMS service (Said 2007). This allows OSIM‟s
retailers to tailor and send specific marketing messages via SMS to shoppers (at no cost
to consumers) who are in the vicinity of their shops; allowing shoppers to gain real time
information on the latest promotions, inducing them to patronise OSIM outlets that may
lead to increased unplanned purchases.




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Improved Purchase Experience


OSIM can introduce In-store touch screen catalogue in every outlets to facilitate
information to consumers, providing them convenience to check out the information of
desired products that they are interested in. This can maintain consumer‟s attention if the
outlet is overcrowded and when in-house staffs are occupied. In order to uphold the idea
of better living and comfort and to enhance the purchase experience of consumers, the
outlets can be designed in a manner whereby it simulates a „homey‟ feeling, such as the
utilisation of quality home equipments (tables and chairs) and decorate a „home‟
scenario, to make consumers feel at home. And to further enhance the purchase
experience, in-house promotions such as „bundle pricing‟ along with complementary
products can be offered to consumers to make them feel satisfy and that the money is
well spent.




Identifying Potential New Customers


Apart from the potential target segment identified in part 3.2, additional new potential
market segment which OSIM can target on to further enhance the sales of uPAPA Hug
have been explored. Using the business-to-business approach (B2B), the business sector
is an area where OSIM can consider promoting their products to.


For example, by promoting their uPAPA Hug product to luxurious lifestyle organisations
like Shangri-la Hotels and Resorts, where their number one ranked credo is to always
provide customers with rewarding lifestyle experience during their stay with them
(Shangri-la 2009). By placing uPAPA Hug in their suite rooms, there is a high possibility
that it would further value add customers‟ stay experience, and thus accomplishing the
hotel‟s credo. As such, by purchasing the product, it becomes a win-win situation for
both parties. To trigger sales, OSIM may also consider giving some bulk purchase
discounts to these potential clients.




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Enhancing Customer Satisfaction


The enhancing of customer‟s satisfaction is critical as it symbolises repeat purchase
(brand loyalty). One way is to offer on-site servicing in addition to its 1-year warranty.
This saves consumers the hassle of sending the faulty equipment to their outlet, and
reinforces OSIM‟s confidence in their product. Membership cards that include discounts
for future purchase and participating outlets (such as cafes or Yoga centres and Gyms)
can also be offered to reinforce the „lifestyle‟ concept for consumers. Lastly, OSIM can
offer trade-in options where rebates will be given for. By doing so, it aids in the disposal
of consumer‟s old equipment and ensure that OSIM remains in their evoked set.




9. Conclusion


This report established an in-depth understanding of consumer behaviours factors that
contributed to the success of OSIM‟s uPAPA Hug with a clear comparison to the
competing OTO PowerTap. As consumer behaviors is product, person and situation
specific, section 1 to 6 provided critical insights to analyse the factors that exert
influences (external and internal) on consumers.


The analysis of marketing mix (4Ps) in section 7 established what shapes the perception
of consumers on both uPAPA Hug and PowerTap and aided in the determination of the
products and markets‟ position and its overall marketing campaign‟s effectiveness. This
analysis, in addition to the discussion of section 1 to 6 enables us to make a concrete
statement that OSIM uPAPA Hug can better influence consumers decisions due to its
product/market positioning and the various marketing strategies employed to their
targeted segments. Recommendations at the end of the report attempts to sustain the
success of OSIM‟s uPAPA, but bearing in mind with the ever-changing consumer‟s
behaviour, only constant innovation that meets to resolve consumer‟s problem will enable
OSIM‟s uPAPA continuity of success in the future.




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Reference(s):


   1. Brand OSIM 2009, „OSIM Asia No.1’, viewed 13th September 2009,
      < http://corporate.osim.com/SG/brand_osim.html#asiano1>


   2. Hardwarezone 2009, „Anybody own an OSIM UPAPA Hug or OTO Powertap?‟,
      viewed 12th September 2009,
      <http://forums.hardwarezone.com.sg/showthread.php?t=2464126>


   3. Maslow, AH 2000, „A Theory of Human Motivation’, Psychological Review, vol.
      50, pg. 370-396.


   4. Purba M, S 2009, „OSIM‟s UPAPA Hug Review‟ viewed 21st July 2009,
      <http://www.osim.com/SG/product/upapaHug.aspx#review>


   5. OSIM 2009a, ‘Inspiring Life OSIM‟, viewed 22nd August 2009,
      <http://www.osim.com/SG/product/upapaHug.aspx>


   6. OSIM 2009b, „OSIM Events’, viewed 5th September 2009,
      <http://osiminspiringlife.wordpress.com/category/osim-events/>


   7. OTO BodyCare 2009, ‘Relaxation: OTO’s Power Tap , viewed 22nd August 2009,
      <http://www.otobodycare.com/sg/english/product.cfm?productid=55D6E120-
      D0B7-89BE-2A13DA5B333D3ADB


   8. Said, MA 2007, M1 partners SPH to offer S'pore's first location-based SMS
      advertising service, Singapore Press Holdings Ltd, viewed on 15 Sept 2009,
      <http://www.asiaone.com/Digital/News/Story/A1Story20071016-30430.html>


   9. Shangri-la 2009, ‘Our Mission’, viewed 25th September 2009,
      <http://www.shangri-la.com/en/corporate/aboutus/mission/ourmission>



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   10. Singstat 2009, „Population in brief‟, viewed 15th August 2009,
      <http://www.singstat.gov.sg/stats/themes/people/popinbrief2009.pdf>


   11. Tandurust 2008, ‘Massage Rollers: Self Help, Handy, Anytime, Anywhere,
      Massage’, viewed 21st August 2009,
      <www.tandurust.com/massage-therapy/massage-rollers-self-help-anytime-
      anywhere-massage.html>


   12. YouTube 2009a, „OSIM UPAPA HUG’, viewed 31 August 2009,
      <http://www.youtube.com/watch?v=0DtN9KxrMZM>


   13. YouTube 2009b, „OTO POWERTAP 30TVC’, viewed 31 August 2009,
      <http://www.youtube.com/watch?v=4f4wx9mdLtw&feature=PlayList&p=2FAA5
      B67BC98C261&playnext=1&playnext_from=PL&index=9>




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