Good Example Of Essay On Marketing
For over a decade between 1999 and 2012, Avon Products, Inc. lost 50 percent of its revenue and sales. This owed to underperformances, an increasingly weakening financial base and disappointed stakeholders. However, the company has since picked itself up, with the CEO recognized among Fortune’s 50 Most Powerful Women in Business 2013 and Fortune’s Most Powerful Women 2014. Regardless, Avon does not just look to avoid the challenges that saw it deteriorate in the first decade of the millennium, but also rise as global business superpower. This marketing plan is a vital part of the strategy for that pursuit.
The marketing plan aims to take Avon back to a strategy for which it is traditionally known, that is, door-to-door direct sales approach. This is the company’s effort to remain true to its customers. However, the plan will also involve adopting other novel strategies, including: innovation, new products and the use of newer technologies (including the use of social media).
But most importantly, Avon looks to enter new markets, especially in the emerging markets. This plan focuses on how Avon could enter the Kenyan Cosmetics market.
Current Marketplace and Competitive Environment
Kenya’s cosmetics market is increasingly growing. Many consumers are increasingly investing in color cosmetics, deodorants, hair and skin care products, bath and shower products, etc. Competition is increasingly intense. Just to show this, many global cosmetics companies are targeting the country’s consumers. L’Oreal is the leading player in the market and holding 10 percent market share in hair care products. Another global player that has since entered the market is Revlon which made a US1 million franchise deal with the country’s retail chain Nakumatt Holdings Limited. Other global players include Proctor and Gamble, as well as other local players. However, the completion is not stiff enough to deter entry. This is a billion dollar market without including the potential for growth. Moreover, projections show the market for beauty and personal care cosmetics is likely to grow in volume and value. Most importantly, the country offers a central hub for reaching out to other near markets (in East and Central Africa, etc.).
The health of the economy is an important factor for consumer spending. To confirm this, one only needs look at the 2007/2008 financial crisis and the recession that followed and how they impacted consumer spending. Apart from the fall in 2008 (like in all countries globally), Kenya’s economy has been growing steadily since the end of the Daniel Moi’s regime in 2002. In fact, the growth in cosmetics spending coincides with this period of relative economic stability and growth. Projections show the country’s economy is to enjoy remarkable growth in the years to come.
The culture of cosmetics was not major in Kenya. However, over the past two decades, the Kenyan market has grown increasingly sophisticated and the consumers are demanding equally sophisticated cosmetics and cosmetic care. The country has in recent years recorded increased culture of spending, and beauty and personal care (including manicure, pedicure, etc.) are some of the areas in which the people like to spend.
It is not only women that go for cosmetics. More and more, men are also becoming key cosmetics consumers, many now also going for manicure and pedicure. However, women are the majority, especially from 18 to 50 years of age. Most of them are working women.
Although many strategies work, the best way to enter the market for a first-timer would be through a player that has been in the market and understands it. This would require a B2B (business to business) positioning involving major cosmetics outlets and retail stores in the country, including cosmetic-exclusive companies and retail stores (like Nakumatt Holding Inc. and Uchumi).
Price is also an important entry factor in emerging markets. However, the consumers are also brand aware. For example, Nivea is a most-preferred brand for many despite the relatively higher- albeit slightly- prices.