Company Profile: Slendertone is a company that specializes in Electronic Muscle Stimulation (EMS). EMS was originally created for medical purposes, particularly for the rehabilitation of muscles after accidents or strokes. It mimics the effects of regular muscle exercise. Slendertone was designed specifically for individuals who want to “exercise” their muscles without actually having to engage in physical activity. By simply remaining seated, lying down, or even doing minor tasks, users can still reap the benefits of a strenuous workout. The development of Slendertone dates back to 1968 when it was first created by BMR.
In that year, the company relocated from England to the tax-free zone in Shannon. Kevin McDonnell, who had supplied the BMR with printed circuit boards for four years, was a creditor of BMR. He expressed interest in purchasing the remaining assets of the company, which had gone into liquidation. This included acquiring ownership of the brand names Neuro Tech and Slendertone. Afterward, McDonnell established the business once again, this time in an old factory located in the industrial estate outside Bunbeg. He had a strong determination to achieve one of his greatest goals: “to develop Slendertone into a world-class brand.”
Within a few weeks, McDonnell and five employees began production. The company recently adopted a new marketing strategy devised by Brian O’Donohoe, the managing director of Slendertone. Slendertone, a world leader in improving muscle tone and body shape, produced the first toning belt approved by the United States Food and Drug Administration (FDA). All products are classified under the European Medical Device Directive and won the Irish Consumer Goods Export Award in 2005. Slendertone has sold over 2 million toning belts worldwide. The products are designed, manufactured, and marketed by BMR (Bio-Medical Research) Ltd, an international company headquartered in Galway, Ireland. BMR has two divisions – Slendertone and Neurotech. BMR NeuroTech focuses on treating muscle disorders and addressing medical needs, while Slendertone caters to cosmetic needs. With over 40 years of experience, BMR constantly assesses and expands its product range for electrical muscle stimulation equipment.
McDonnell constantly reinvested his earnings back into the business, dedicating much of his limited investment resources to conducting research in biomedical technology in order to develop new products. Additionally, the company was in the process of upgrading its production facilities and had recently acquired a larger factory at the Bunbeg industrial estate. McDonnell firmly believed that the development of new products was crucial for future growth. To make the most of his limited resources, he utilized distributors to expand into export markets while simultaneously improving the quality of their products.
Legend has it that Kevin McDonnell moved the company from Shannon to Donegal by loading everything onto a lorry. Today, Slendertone’s range is manufactured in Donegal. The company offers six types of products, categorized into Male and Female options. The product lineup includes:
Male:
System Abs Male – €169.99, delivers results in 4 weeks
Flex Max Male – €149.99, delivers results in 6 weeks
Flex Male – €79.99, delivers results in 8 weeks
Female:
System Abs Female – €169.99, delivers results in 4 weeks
Flex Max Female – €149.99, delivers results in 6 weeks
Flex Female – €79.99, delivers results in 8 weeks
Slendertone is a subsidiary of Bio-Medical Research Ltd (BMR), which holds over 40 years of experience. BMR specializes in manufacturing medical device quality electrical stimulation products with strong clinical evidence and controlled product trials.
Every day, thousands of doctors and physiotherapists rely on BMR products to benefit over 200,000 patients each year. These products undergo a rigorous research and development process, ensuring that Slendertone products meet the highest standards. Multiple clinical trials have proven their safety and effectiveness. A dedicated team of scientists and R&D experts work closely with local and international universities to conduct advanced clinical trials.
The University of Wisconsin, the University of Limerick, Loughborough University, the University of Ulster, Jordanstown, and University College Dublin are included in the team of researchers and developers who have expertise in exercise science, electronics, mechanical engineering, and embedded software. BMR has worked closely with local and international universities in sophisticated R&D programs, bringing many patented products to market. Initially, McDonnell started his production with only 5 employees. Slendertone is manufactured in Bunbeg in Co Donegal, employing 150 people.
Additionally to the 60 individuals employed at BMR’s headquarters and research and development facility in Galway, the company also has staff of 80 in Germany, 60 in the US, and 25 in the UK. As BMR grows rapidly, it intends to expand its workforce to approximately 420 employees. Notably, McDonnell became the primary investor in 1991 when they acquired Slendertone after the company faced liquidation. Hence, McDonnell’s investments were crucial in saving the company from obsolescence and turning it into a profitable enterprise. Presently, Slendertone is an exceedingly successful company boasting a strong mission statement.
Their goal is not only to become a renowned brand but also to dominate the market. Currently, Slendertone is most popular in Britain, where it is available in 1,300 Boots stores and other locations. France and Spain follow as the next top markets, while Ireland ranks lower on the list. Mr. Kennedy, the chief operations officer of BMR, an Irish company and international success story, emphasizes that the focus at Slendertone has shifted from research and development to being market-driven.
Kennedy comments. Marketing Strategies : Slendertone was initially created by BioMedical Research Ltd. (BMR), a company that specializes in direct marketing. BMR’s Marketing Department in Galway is responsible for new product development and market expansion. BMR has a substantial investment in direct marketing campaigns in Ireland and the UK. The company primarily utilizes TV (short form and long form), retail, catalogues, direct press, and database marketing as their main distribution channels. Additionally, BMR has distribution subsidiaries located in the US, Germany, Japan, and France.
Slendertone’s global sales were managed by various small local distributors and companies with different product focuses. Slendertone introduced its first new product, Gymbody8, in 1993. To market Gymbody8 for home use, they utilized strategies such as mail order catalogs, small print media advertisements, and a limited number of retail outlets. However, these efforts resulted in below-par sales performance. In an attempt to improve sales, the French distributor adopted an American-style Direct Response approach known as an “Infomercial.” This involved a 30-minute chat show featuring interviews with celebrities and regular individuals, which immediately yielded positive results.
The French promotional strategies involved extensive utilization of direct response (DR) advertisements in print media. Except for domestic markets, Slendertone’s sales were all conducted through distributors. These distributors believed that retail sales would require excessive explanation from sales staff, so retail was primarily limited to pharmacies and sports stores. As the direct response approach proved successful in France and Ireland, the company shifted its sales strategy focus from developing local distributors to exploring opportunities in DR television.
Then they chose to focus on “Home shopping” companies that purchase TV airtime in multiple countries and air various direct response programming. Additionally, Direct shop aired the infomercial along with car care products, kitchen gadgets, and most importantly, fitness products and exercisers. The infomercials were primarily aired late at night or early in the morning. Direct shop also had a generous customer returns policy. One significant success factor attributed to the direct response approach was its ability to enable company representatives to effectively explain the product’s functionality.
Direct response has also enabled the company to create a large customer database, which can be utilized for marketing future products. Their promotional tactics involve magazine advertisements, distributing “Bounty bags” containing baby products in maternity wards, providing money off vouchers, and supplying brochures explaining how EMS works on the body. Upon reaching their 30th year of operation, the company included a special 30th Anniversary logo on their promotional materials to assure buyers of their long-term marketing support.
They used various questionable methods, such as showcasing topless models and making exaggerated claims about their products using the term effortless exercise. They also relied on endorsements. However, sales began to drop in France after 1996, leading to the decision to lay off some temporary workers. To combat this decline, DR activities and Public Relation activities were initiated in the UK. Recognizing the need for more marketing efforts after these slow sales, they decided to approach the problem from the customer’s perspective and presented the product as “the most effective and convenient appearance solution”.
The managing director of the company, O’Donohoe, emphasized that Slendertone is primarily concerned with appearance rather than health. He underscored the importance of looking good and expressed the company’s efforts to distance itself from the perception of being just a gadget. This repositioning was encapsulated in the new slogan, “Living life and loving it.” By 1999, as sales continued to decline and overall conditions worsened, the company decided to stop targeting specific market niches such as prenuptial and postnatal customers. Instead, they opted to keep Slendertone’s message focused and unified across all market segments.
In order to promote their brand Slendertone, they implemented a Branded house strategy by giving their individual products the corporate brand name. This resulted in Gymbody8 being renamed as Slendertone Body, and Face Up becoming Slendertone Face, among others. They also prioritized expanding their retail channels. However, they still recognize the importance of direct marketing for entering new markets. They are not interested in competing on price with lower quality producers; instead, their goal is to offer customers greater overall value at a higher price.
Slendertone faced problems with their marketing strategies as they tried to expand their market. They used specific techniques to maintain their market position, but these techniques ended up creating a negative impression and hindered their goal of establishing a superior brand image. We will discuss these issues based on different criteria, focusing on the case sectors. In terms of location, Mr. Mcdonell relocated the factory to an industrial state outside Bunbeg.
It was located in a remote area near a coastal village in the Gaeltacht region of northwest Dongel. This location was so remote that it was likely very challenging for any company to maintain their supply chain and distribution chain. As a result, they probably had to deal with high transportation costs because of its distant location. Vision: • Mr. McDonell had a lofty vision to transform Slendertone into a world-renowned brand. He aimed to make Slendertone as popular as diet Pepsi.
The brand faced a negative perception of being ordinary under the name “Gadget” according to their vision. However, Mr. McDonnell’s focus was solely on improving product quality through research and investing in biomedical technology to develop a new product. While this was a good initial step, it could lead to future issues as discovered through further study.
In terms of products, Slendertone has only produced one so far, known as Gymbody 8. They also manufactured two other products, Minibody and Intone, but these do not feature the Slendertone logo due to their low price point.
This was an inappropriate move made by Slendertone as they should have focused on increasing their brand popularity by introducing umbrella brands, regardless of the market situation they were facing. Even though they introduced Gymbody 8, the sales were initially low due to a lack of brand awareness and promotional activities. There was also uncertainty regarding the use of units and correct placement of pads, which caused inconvenience for customers during attachment. Distribution:
After reestablishing the company BMR, they continued to use their existing distribution channel but also added new distributors. During this process, they discovered some factors that had a negative impact on their distribution channels.
One important factor was that all sales of Slendertone were handled by distributors, except in the home-market. Due to limited marketing resources resulting from investments in research and production, BMR believed it would be more cost-effective and efficient to develop new markets for Slendertone themselves. Some distributors operated from their homes due to the small-scale nature of their operations. However, BMR was accommodating and allowed them to do business with diverse product interests such as an oil importer and a garden furniture dealer.
The distributors faced challenges when trying to invest on a large scale for market development. Instead of improving their sales performance, they tried to attribute their lack of efficiency to legal restrictions and cultural factors.
Furthermore, there was a lack of secondary data available for the EMS product class. Additionally, distributors were hesitant about sharing their sales data with Slendertone. This made it difficult for BMR to determine the market share held by different companies in this industry segment.
Assessing the market size of EMS products in each company was challenging due to a lack of data. Additionally, the French distributor had requested higher margins, product development, and a pricing strategy. However, they were also using unauthorized self-promotion methods such as tacky advertisements featuring topless models and making sensational claims about the effectiveness of the products. These claims included phrases like “effortless exercise” and “the equivalent of 240 sit ups in just 40 minutes, while watching TV”.
One issue we observed with the distributors was their lack of interest in the professional market. They made minimal attempts to develop this market, even though the retail price of a single Slendertone product exceeded 4000 pounds. Additionally, management considered direct marketing as a solution, as it could generate immediate response. However, direct response activities were limited in certain countries, such as Germany, preventing them from accessing many markets.
Infomercials were successful in some countries but their production costs limited their global reach. There was a perception that direct response (DR) activities worked well in Ireland and France, leading to a switch from local distributors to securing DR television opportunities. A contract was then made with Direct Shop to promote the product. However, Direct Shop maintained high profit margins like other home shopping companies, causing Slendertone’s outcome to be less than 25% of Gymbody 8’s retail price. The timing of the show, which aired late at night or early in the morning, also played a significant role as many users were not notified due to the awkward timing. Direct Shop also aired the infomercial alongside car care products, kitchen gadgets, and fitness products. Additionally, Direct Shop had a very lenient customer returns policy, resulting in a high product return rate of 35%. It was often found that purchasers had not even opened the outer packaging.
Direct Shop returned a large number of unsold products when they were not selling. During times of turmoil, Direct Shop started broadcasting across Europe at a lower price than local distributors. While many people found the infomercials interesting and entertaining, some felt that they had a misleading presentation. In terms of the retail market, Slendertone’s distributors were not effectively securing individual users.
The retail market had low outcomes due to a lack of securing retail distribution and not following a clear strategy for developing retail channels. Only pharmacies and sports shops were included in their retail market list. Customer feedback indicated both positive and negative issues, including some dissatisfaction with the product’s effectiveness.
Many customers chose not to provide feedback. Some found the presentations to be exaggerated and artificial. The low number of replacement sales indicated that the product had limited long-term use. The customer concerns included uncertainty about using the unit, difficulties in placing the pads correctly on the body, and the hassle of attaching the pads to the unit. Some customers perceived Slendertone as being outdated compared to its competitor Ultratone, which claimed to offer newer, faster, and more effective technology. However, the main issue was that customers were conservative during the buying process and did not engage in buzz marketing. They remained silent about using Slendertone to enhance their appearance, indicating a desire for privacy.
The target market of Slendertone initially was defined as women aged 25 to 55. However, this approach had some critical issues. Firstly, they failed to properly divide the market into segments, such as young-youthful, young affluent, elderly affluent, or elderly middle class. Secondly, they considered men as a niche segment for their product, when in fact they could be a significant segment for Slendertone. Lastly, they overlooked the group of individuals who frequent gyms and fitness centers, primarily muscle builders.
Also, they aimed to avoid targeting individuals who were already physically fit but had a keen interest in improving their body tone. They strategized to assess the potential demand in each country by considering the size of the target market and its niche segments. When the target market was not defined accurately, any calculations based on it would not yield accurate results. In terms of positioning, Slendertone’s image was ambiguous as it was sometimes linked to dieting, exercise, weight loss, health, fitness, toning, and body shaping.
The company did not succeed in establishing a distinct brand positioning in the minds of consumers. It was wrongly believed that Slendertone was the leader in the market, but research showed that its market share was much smaller than previously thought, accounting for only a fraction of the home used EMS market. The company’s managing director, O’Donohoe, stated that Slendertone is focused on appearance rather than health, which could create negative associations and raise concerns about credibility and assurance in consumers.
The statement that “most people work out to look good rather than to be healthy” contradicts the fact that the majority of people exercise and reduce weight for physical and mental fitness. Repositioning the brand with the slogan “living life and loving it” can create a stereotyping image if being toned is equated with living and loving life. The infomercials and other promotional strategies have failed to remove the gadget image from the Slendertone brand. The management of BioMedical Research Ltd. (BMR) is primarily focused on producing Electro Muscle Stimulation (EMS) units and reinvesting earnings into developing new products. This approach neglects the importance of satisfying customer wants and needs and fails to properly market their products. The company needs to focus on a unified message instead of having different messages for different market segments. By continuously focusing on their products rather than identifying underlying customer needs, they are too product-oriented and facing marketing myopia despite their efforts to address it.In the product development department, Slendertone introduced several products under their brand, including Slendertone Minibody, Slendertone Intone, Bustyler, The Face up, and Celluforme.
The company did minimal market research while developing these products, instead relying on the criteria set by the French distributor. This decision seems unnecessary and costly. The competition has been increasing, putting pressure on prices. Competitor products are often of poorer quality, though not necessarily cheaper. To compete with lower priced, lower quality EMS products, the company lowered the retail price from 1993 to the beginning of 1996. They also produced some products without the Slendertone logo to meet the demand for cheaper options by distributors. Slendertone faced issues with its products, target market, position, promotion, distribution, and brand awareness. Improving strategies in these areas can help improve or regain the company’s image and market position. Some alternative solutions include implementing promotional strategies.
In order to overcome the limitations of their direct model marketing approach, Slendertone can implement integrated marketing communication strategies. Firstly, they should create general television commercials to complement their infomercials. These commercials will help build a strong brand image and inform viewers about the core benefits of their products. They can also continue using infomercials to drive direct sales. Additionally, placing billboard advertisements and print media ads near fitness centers and in fitness magazines will target health-conscious individuals who are interested in maintaining a toned physique.
To increase brand awareness, Slendertone can utilize product placement strategies. Furthermore, they can incorporate sales promotion techniques such as offering premiums, free trials, and warranties. These tactics will not only develop a strong relationship with customers but also enhance their understanding of the product.
Moreover, sponsoring fitness programs that promote the use of Slendertone products after workouts will further increase brand recognition and highlight their effectiveness in toning the body.From a public relations standpoint, Slenderton can effectively communicate with beauty salons and fitness centers, providing them with knowledge about the product and encouraging its use for better physical fitness. This can be done through press conferences, speeches, and direct marketing initiatives such as point of purchase centers where free trials and product demonstrations are offered. Additionally, an excellent internet service allows customers to customize and purchase the product online. Infomercials serve as a means for direct marketing and facilitate customer purchases. By blending these promotional activities, Slenderton can create a strong brand image and effectively reach their desired target customers. In terms of target marketing and positioning, Slendertone can expand their market and secure a place in consumers’ minds by segmenting geographically, considering the importance of geographical segmentation in international marketing.After selecting geographic segmentation, the company can choose to segment by demographics. They can target both male and female individuals between the ages of 18 to 60. Additionally, they can opt for psychographic segmentation. They would target achievers and experiencers from high-resource zones, as these individuals seek achievement and new experiences. They can also select strivers from low-resource categories, as these individuals tend to be more fun-loving and open to taking chances in order to better their lives when they have some material wealth.
Alternatively, the company can focus on targeting individuals who are already in good shape but want to maintain a well-toned physique as a niche market alongside their general target market. From a positioning perspective, they can position their product as a way to achieve a good physique without the need for heavy exercises.
Furthermore, they can position their product as an efficient way to maintain a toned body with minimum effort. Many individuals who have already achieved a good shape become highly aware of how to maintain their physique in order to continue looking good.
Another positioning strategy they can employ is positioning Slendertone’s products as essential exercise instruments that help tone the body. By utilizing points of parity and points of difference, the company can emphasize the superiority of their products and enhance their market position.Slendertone can enhance their position in various ways, including timing of use, product effectiveness, method of use, and packaging. Implementing this positioning strategy will allow them to regain market share and rapidly increase sales. However, Slendertone needs to address their distribution strategies. Applying effective promotional techniques can encourage customers to request the product from retailers and prompt intermediaries to order it. Since Slendertone aims for high brand loyalty and consumer involvement, a Pull Strategy would be more appropriate. To determine the supply chain, Slendertone should identify their target market first and then work backward from there.
This approach to demand chain planning does not simply focus on pushing the product through the system, but instead prioritizes understanding what solutions customers are seeking, rather than just what products the company is attempting to sell. Rather than relying solely on distributors, the company can consider utilizing retail stores and other direct response activities. Telemarketing or internet platforms could be particularly beneficial for marketing highly involved products, as they provide a more personal touch. Even if distributors are used, exclusive distribution should not be relied upon in the manner seen with Slendertone; instead, selective distribution should be pursued.
They relied solely on exclusive distribution but were unable to sustain exclusive relationships, resulting in their distributors expressing interest in selling various product markets. Since Slendertone is an established company, it has the opportunity to enlist several intermediaries who are willing to distribute their product. • It is crucial for the company to manage the conduct of these intermediaries by utilizing their legitimate power- meaning that the manufacturer expects specific support and actions from the intermediaries as outlined in the contract.
One important behavior that a company should exhibit is to not advertise their product on their own. They should refrain from empowering intermediaries to make decisions about advertising their product. This is necessary to prevent the dissemination of tacky or irrelevant advertisements and negative promotions. Additionally, Slenderton has conducted numerous studies and found that they have very little brand equity in the minds of their consumers. As a result, they are facing significant barriers in their objective of establishing themselves as an international brand and creating a superior brand image.
In order to increase their brand loyalty and image, they can utilize the following methods:
– Firstly, they can leverage the Brand Asset Valuator (BAV) model to build their brand equity. Through this model, they can differentiate themselves by developing product strategies that align with their promises. Additionally, they can enhance their brand’s presence in the minds of consumers by improving the esteem value and ensuring clear knowledge of their brand. By employing the AAKER model within the Brand-as-product theory, they can establish a distinctive brand identity by highlighting Slenderton’s scope, attributes, quality, uses, users, and origin.
– They can also consider the BRANDZ technique to raise awareness. This technique involves creating a strong presence, demonstrating relevance, performance, and competitive advantages. By doing so, they can foster a strong connection with their target audience.
– Another approach is to enhance their brand image by utilizing the six brand building blocks. By consistently implementing these blocks, they will be able to create a superior brand resonance and successfully achieve their objectives. They can also redefine their position by modifying certain brand elements such as logos, symbols, slogans, etc.
– Further, opting for brand extension can help them gain a larger market share. By bringing their other products under the Slendertone umbrella, they can leverage the recognition already associated with the Slendertone name and encourage customers to explore additional offerings.After conducting thorough research, it has been determined that Slendertone has encountered numerous significant challenges in their marketing efforts. Despite the availability of multiple potential solutions, Slendertone’s management must implement a single solution to address these issues. The current situation of Slendertone indicates that their brand is under severe pressure to not only survive but also maintain their market position.
Slendertone needs to prioritize the development of their brand image in order to rebuild their market share and enhance brand equity. In order to achieve this, they should implement a comprehensive approach to marketing activities that considers all aspects of the brand experience. Holistic marketing activities focus on creating meaningful brand contact and recognition for every organization involved.
