Analysis And Evaluation Of Rimmel's Market Strategy In The UK Cosmetics Industry

The task is divided into two parts (Part 1 & Part 2) and candidates are expected to address both.

Your task is to identify a brand of facial cosmetics and then analyse, evaluate and prepare an report addressing the following issues.

• Using appropriate sources undertake a full marketing audit of your chosen category and brand. Include an evaluation of the current marketing strategy and position in the market.
• Provide a critical evaluation of the brand’s competitive edge (USP) with comparison to the main competitor brands in the marketplace. Demonstrate the brands effectiveness by providing an evaluation of their current market performance in relation to their competitor’s. This should include relevant market performance data to underpin your evaluation, for example market growth, sales trends, profitability etc.

• Based on your Part 1 analysis provide the rationale for the introduction a new product to the range.
• Outline the features / benefits of the new product.
• Identify target segment/s.
• Set clear marketing objectives(SMART) to launch a new product with the aim of increasing brand awareness, market share, sales and/or profitability.
• Recommendations - with application to the marketing mix, recommend a relevant marketing strategy to addressing the marketing objectives.

These suggestions should be your own ideas but may include marketing tactics and strategies used by other successful organisations or companies.

Your arguments, findings and recommendations should be supported by theories, facts and figures published within academic books, journal articles, recognised business magazines and market intelligence reports.

Despite economic uncertainties, the UK personal and beauty care market continues to hold a strong market position as it maintains another year of solid business growth in 2017 (Euromonitor.com 2018). Global players such as L’Oreal and Estee Lauder continues to dominate the cosmetics industry. These global brands are increasingly growing with their concerns for an improved consumer experience. As a result, these brands are trying to improve both their online and in-store service quality. L’Oreal, for example, acquired ModiFace in the earlier part of 2018 to enhance its online presence. The driving trends behind global brands heading to online presence and the development of a range of new products are technology and premiumisation; the influence of Millennials and social media; wellness and health; and transparency and natural claims. However, the Brexit could have its impact on sales and slow down the growth of few cosmetics categories like colour cosmetics (Euromonitor.com 2018).   

Rimmel is being chosen for this report, which is headquartered at London, UK. It is now owned by Coty, Inc. It prepares a variety of beauty care products like Mascara and Fresher Skin Foundation (Rimmellondon.com 2018). Rimmel’s products hold good reputation and fan following in the UK. The highest selling Rimmel’s products in recent years are eye make-up products, lipsticks & lipglosss and nail care & nail varnish (Statista 2018).

The main purpose of this report is to evaluate the facial cosmetics industry in the United Kingdom and the Rimmel’s current market strategy. It also analyses the Rimmel’s competitive advantage in comparison to the industry’s leading brands.  

SWOT analysis

Strengths	Ability to identify its target audience Range of beauty care products that are a big attraction for girls Rimmel is very effective at distribution of products Rimmel focuses on female beauty products that are increasingly growing in demands in the UK Rimmel’s products are available in various parts of world It makes the high quality products
Weaknesses	Uncompetitive products’ packaging Unsuitable to people having kinds of skin allergies
Opportunities	The booming beauty care industry in the UK Driving trends such as growing interest of Millennials in cosmetics products, incrementing online purchase of beauty care products, premiumisation and technology etc.
Threats	Rising dominance from global leaders of cosmetics products such as L’Oreal and Estee Lauder Political threats in the form of Brexit as it can expectedly slow down the growth of few cosmetics products like colour cosmetics

Table 1: SWOT analysis of Rimmel

(Source: Twigg and Majima 2014)

Rimmel needs to work on products’ packaging as it is one of the factors that influence the consumers’ perception. Considering that the gap between premium and mass products have broadened with customers mostly liking the premium products, it is an urgency to focus on packaging (Yeo, Mohamed and Muda 2016). Considering that global cosmetics brands have dominated the UK cosmetics industry in recent years, it is important for Rimmel to work towards improving its value chain operations to remain solid in market (Yeo, Mohamed and Muda 2016). 

Political	Taxation can either have a positive or negative impact Political stability may get affected from Brexit Minimum labour  wages
Economic	Economic growth rate of the UK is slowing down Cosmetics industry is expected to witness a slight growth Premium products are in demands
Social	Consumers expect a variety of cosmetics products from their chosen brand Rise in the consumption of organic cosmetics Rising trends for online purchase
Technology	E-commerce market has generated substantial sales in recent years. It is expected to go much higher than this. An incrementing use of innovative technologies to produce the eco-friendly and environmentally-friendly products
Environmental	Rising trends towards ‘greener approach’ to support a reduced or no harm to skin Rising concerns to avoid the usage of artificial substances like toxins, parabens and petrochemicals
Legal	Labelling and branding are regulated The UK regulations determine the safety standards of cosmetics items

Table 2: PESTLE analysis

(Source: Prakash and Sharma 2016)

Political scenario post Brexit can bring the uncertain outcomes for beauty and skin care industry. Operational costs will be a key area to work considering that labour wages is uncontrollable. A cost-effective and quality-oriented approach is mostly needed to avoid the impact of economic instability. A focus is also needed to improve the employment rate to boost and encourage the purchasing capacity of consumers. An effective existence in the online shopping will hold the key considering that global competitors like L’Oreal has been extremely effective with its online and in-store shopping. Rimmel needs to work towards ensuring an adherence to regulations for labelling and branding and also improving its packaging quality. The ‘greener approach’ is trending. It must be taken care with effective strategies.

Marketing Strategy

Rimmel is an established brand name in the cosmetics industry in the United Kingdom. Apart from operational excellence, it also has been very effective with its marketing strategies. One of its strengths is to appropriately identify its target audience. It has usually divided its customers into segments such as primary and secondary. Girls aged 16-24 have mostly been kept under the primary groups whereas women from 25 to 34 in secondary groups. Nevertheless, Rimmel’s products are extensively popular among girls. It shows Rimmel’s ability to effectively identify the potential consumers (Rimmellondon.com 2018). ‘Maslow’s hierarchy of needs’ can help to understand why it is important to identify the target audience. Maslow classifies employee satisfaction broadly into five levels such as follows:

• Physiological needs
• Safety needs
• Social needs
• Esteem needs
• Self-actualisation

At the physiological level, stable employment and salary is the minimum requirement, which employee needs to survive. The next level is related with physical and environmental issues such as pension, benefits, fair work practices and safe work environment. The next level requires the fulfillment of social needs like social acceptance, cooperative colleagues and friendship workplace. At the fourth level, there is a need for the fulfillment of esteem needs like positive self-image, respect and recognition issues like job titles, impressive job assignments and nice work spaces. At the final or fifth level, ‘self-actualisation needs’ are required. These includes like autonomy, status of subject matter expert on a job and challenging work (Lee and Hanna 2015).

The above section just shows the kinds of needs and wants, which employee need or expect from its employer. Maslow’s hierarchy of needs is valid in marketing as well. Marketers believe that a fulfillment of wants and needs of consumers can be used to influence the selling. An extensive research on segmentation, target market and positioning statement is always a part of marketing campaigns. A several number of factors like demographics, geographic, social class and others are followed during the market segmentation. These factors actually help to have a specific brief of who the target customers are and prepare the marketing strategy accordingly (Ba?ík, Štefko and Gburová 2014). Moreover, it also shows the validation of Maslow’s hierarchy of needs in marketing.   

Online videos, sponsoring of events and large number of girls have always been a part of Rimmel’s advertising campaigns. However, few of these marketing stunts can now be skipped to adopt the ‘Influencer Marketing’. ‘Influencer marketing’ is an emerging marketing trend in cosmetics industry where influential people such as celebrities are endorsed for advertisements (Bokunewicz and Shulman 2017). The need to adopt the ‘Influencer Marketing’ can be understood from the ‘Marketing Mix’ theory. The theory says that equal importance needs to be given to each of its four elements such as price, place, product and promotion (Datta, Ailawadi and van Heerde 2017). Considering promotion is an integral part of marketing mix theory, the adoption to influencer marketing can be suggested to Rimmel. 

Competitive Advantage of Rimmel

Rimmel’s competitive advantage can be analysed by using the ‘Competitive Advantage Model’. According to the model, competitive advantage can be measured along two variables- cost advantage and differentiation advantage. Cost advantage means offering products at the market price; however, keeping the operational costs low to attain a higher profit margin. Rimmel unlike its competitors in the UK like L’Oreal and Maybelline aims to offer affordable products. However, it is not as good as L’Oreal and Maybelline in terms of offering quality products. Rimmel mostly targets the middle-income section of society. Despite these facts, Rimmel is one of the three top selling cosmetics brands in the UK (Rimmellondon.com 2018). These facts suggest that Rimmel is effectively placed with its cost-advantage strategy; however, it might not continue holding the similar reputation in long-term. This is due to the emerging trends in the cosmetics industry like the ‘gender neutral beauty products’. Such products can effectively reduce the costs of manufacturing, operational time span and also the wastages. These variables are required to offer quality products at the most competitive prices and to cut down on carbon footprint impact of companies (Ramli 2015). Since ‘gender neutral products’ are unique products, it is more feasible to companies already adhering to the differentiation strategy. Hence, it is important for Rimmel to adapt to the differentiation strategy to sustain the already gained reputation in the UK market.   

Rationale

As earlier stated in the aforesaid section, there is a need to match up with emerging trends in order to retain a strong market reputation. One of the emerging trends is the rising popularity of ‘gender neutral products’ (Nählinder, Tillmar and Wigren 2015). The trend should attract industry leaders towards it considering the booming cosmetics industry in the United Kingdom. Industry leaders must eye on gaining the competitive advantage by producing a more diversified products. This is where Rimmel lags behind to its competitors like L’Oreal and Maybelline. L’Oreal, in particular, offers a diversified range of products at premium pricing. Notably, customers respond to the differentiation strategy being adopted by L’Oréal (Asgari and Hosseini 2015). Rimmel probably has no other ways than to go with a new product development to remain successful in long-term considering the rapidly emerging industry trends. The importance to innovate and adapt to the differentiation strategy can be understood by seeing how other competitors are extensively focused on doing innovation. L'Oreal, for example, feels that innovation is for good times not when change becomes critical (Loreal.co.uk 2018). Therefore, emerging trends and Rimmel's competitors like L'Oreals' aggressiveness towards innovative strategies collectively create the necessity for adapting to the differentiation strategy.

Specification

Innovative Strategies and Emerging Trends

The new product will be a ‘Facial Cleanser’, which will be suitable for both men and women. Daily facial cleanser is a face wash cream, which is suitable both for men and women. The product is sulphate-free and contains a cleansing agent to help impurities extract out and also rinse off. The presence of hyaluronic acid ensures that skin stays hydrated.

Segmentation

A number of variables can be used for market segmentation. Those variables are as follows (Gengler and Mulvey 2017):

• Demographics: Segmentation is done based on factors like age, gender, education, income, ethnicity, marital status etc.
• Psychographics: It includes emotions and personality based on different behaviours like attitudes, lifestyle, risk aversion, hobbies, leadership traits etc.
• Behavioural: It refers to the pattern of consumption, usage rates, benefits etc.
• Geographics: Different countries, area, region, population density, climate and other factors are considered.

Segmentation for the new product ‘Facial Cleanser’ should be done based on demographics. The product is chosen to suit the rising trend for gender-neutral products. Gender-neutral products are one of the emerging trends, which are beneficial for both consumers and cosmetics making brands. Such products will effectively shorten the space in bathrooms, which were initially required to keep cosmetics products separately for each of the family member. Now, their needs will converge to common products with the help of the chosen new product and the growing manufacturing of gender-neutral cosmetics. Moreover, this will effectively reduce the space required to keep the cosmetics items and will also enrich the interpersonal relationship between married couples and the families.

Targeting

According to Bruwer and Li (2017), target market positioning is an essential activity of marketing, which requires a thorough study of consumes data for identifying their behaviours. An effective targeting requires a large-scale data collected through various means like online surveys, consumer opinion polls and others. With regard to a large-scale data, it is important for Rimmel that it is working or about to adapt to the ‘big data’. Additionally, Rimmel should also be aware of how to appropriately utilize such a huge data as a meaningful utilisation of data is rarely done by companies across the globe. A meaningful utilisation of big data can be attained by applying the big data analytics and artificial intelligence to the system.

Target market for Rimmel are mostly the men and women above 18 years. Men and women who are concerned with their skin texture and belong to middle and high-income groups are mainly targeted. Rimmel wants that men and women believe that they are beautiful and attractive the way they are. In particular, consumers who are employed or are into academics and have little time to spend on their facial makeup are also being targeted. Nevertheless, these working and studying men and women have comparatively more purchasing capacity than the others. Their schedules are generally very hectic as they are needed to get prepared for long working hours, client presentations, hectic work schedules and deadlines. The chosen ‘Facial Cleanser’ is very suitable especially to these people who are packed with hectic daily routines.

Conclusion

Marketing goals

“Be able to reach to the target population and to influence their purchasing behaviour for the proposed facial cleanser” 

Marketing objectives

Marketing objectives for the new product launch will be as listed below:

• To reach to the target consumer group
• To identify and use effective marketing tools to be able to communicate with the target population
• To be able to communicate and answer possible queries of audience
• To use effective social media tools to communicate with people

This section covers a marketing mix for designing appropriate marketing tactics to launch the proposed product. Four Ps will be used here as a marketing mix.

The proposed product is a “Facial Cleanser”, which can be used by people of both genders. Rimmel holds a reputation in the UK cosmetics industry of offering budgetary products. Rimmel’s need to use the differentiation strategy appropriately to make its products look different from of others. Differentiation is attainable by doing differentiation in products, price or packaging (Datta, Ailawadi and van Heerde 2017). In case of Rimmel, there are the needs to improve the packaging of products, as its products have looked uncompetitive in terms of packaging on being compared with L’Oréal in particular. The chosen product is a unique approach towards introducing the ‘gender neutral products’. There are trends emerging for such products. Major players in the United Kingdom will most certainly take the advantage of the trend. The product will be a step towards innovation for Rimmel.

This is another very important segment of a marketing mix plan. Pricing like the products’ selection needs to look competitive. However, it does not mean offering products at cheaper rates but rather at a most competitive price (Fan, Lau and Zhao 2015). Rimmel has an earned reputation of offering budgetary products. Now, the company need to think the other ways of it, which is to offer the product at the most competitive price. Market price for a ‘non-gender specific facial cleanser’ of 100 ml is around 18.42 GBP. Rimmel will look to offer the product somewhere around 18 GBP in order to have the competitive edge.

Since, Rimmel has always followed an indirect distribution strategy, this time also the same strategy will be followed. Rimmel follows an indirect distribution of products, as it does not own a store. Unlike L’Oréal and other major players in the United Kingdom, Rimmel instead sells its products through variety of channels. It collaborates to supermarket stores to sell its products. This is indeed a good way to reach to a wider consumer base considering that the supermarket industry in the UK have been a booming sector (Fan, Lau and Zhao 2015). Rimmel also goes to pharmacies and chemists to sell up its products. The proposed ‘facial cleanser’ will also be sold at supermarkets, pharmacies and chemists.

This is perhaps one of the most vital aspects of a marketing plan considering that it helps to reach to the target audience and that it establishes an effective communication between employers and consumers. This is necessary to earn consumers’ trust in the product and the products’ brand. Promotion now is not only restricted to using potential platforms of promotion but also connecting with the target population (Khan 2014). With regard to the stated fact, promotional campaigns that engage audience with it finds a wave reception of the audience (Khan 2014). Rimmel has already done it through a campaign targeted on ‘brand evolution’. These campaigns are trending because Generation Z and millennials consumers do also want to be a part of such campaigns. It means they value co-creation campaigns (Khan 2014). Considering the trending changes in marketing campaigns, Rimmel will also go with a campaign that engages audience and make them a part of it.

Apart from this, establishing a communication with followers on Twitter and Facebook is always a good way to be connected with them and respond to their queries. This is a good way to communicate the reason why this product was selected. Moreover, an informative discussion in this way can also influence the purchasing behaviour. These social media channels are also the source to access to feedbacks, which followers share on the page. It gives an opportunity to the employer to consider these feedbacks and amend these changes into the product.       

Conclusion 

In summary, this can be concluded that the proposed product a ‘facial cleanser’, which is non-gender specific should be a success considering that these products are trending. However, the success will lot depend on how Rimmel takes care of the marketing mix. Rimmel has always looked less competitive from its competitors in terms of products’ packaging. Rimmel needs to work on its packaging strategy and the branding of product. Apart from this, the company needs to work on promotional campaigns to make it much livelier for the audience.

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