Friday, July 12, 2013

MAC Company Review - Business

Company: Product: Luxury cosmeticsCompetence: Professional make-up products Image: M.A.C is the only professional make-up brand that comes to mind of the customer. It is associated with glamour. One can consider it as a charity company because they don??t test on animals, and donate the revenue from Viva Glam products to help people with HIV. The company is also popular with its environmental efforts. Customer returns lipstick packages to be recycled; in return she gets free products, too. M.A.C does not invest in mass advertising and word of mouth endorsement makes the company more reliable. The brand name is straight forward and clear: M.A.C =Make-up Artists Cosmetics. The customer does not get confused with pompous names. Experience: Founders were make-up professionals. Culture: Salespeople don??t push the products to customer, they approach like friends, train the customer on make-up. M.A.C is generous, too. Customers are given gifts next to purchases as well to charit y. Customer: Needs: Customer wants better look that lasts long. She wants to hide undesired zones and look like the beautiful, popular, attractive stars. She needs the assurance of a glamour look after make-up. Market size/growth: The company addresses ??all ages, all races, all sexes, all M.A.C?? as its motto suggests. But mainly fashionable women with middle/upper middle income from all over the world are targeted. Apart from every day customer there is a product line for makeup professionals (makeup artists, aestheticians, cosmetologists, hairstylists, models, photographers, e.g.) as well as students in this field. The target market is thus great in volume and expanding as beauty is gains higher importance in people??s lives. Benefits sought: Apart from the improved appearance the customer gains self confidence with M.A.C cosmetics in her daily life. Intangible assets outweigh greatly tangible assets of M.A.C products. Channel: M.A.C can be found in retail stores as well as in its own stores in different shopping malls. Decision maker: The customer itself decides to purchase the product. This buying process is rather an impulse than a careful comparison. The customer gets influenced by the color or the effect of the product and rarely compares it with other brands. Frequency of purchase: It differs from product to product. Usually women don??t wait until current products are totally finished. Different colors of a lipstick can be used at the same period for example. Seasonal trends may affect slightly buying frequency of a particular product. A customer buys mostly one unit from a product. Loyalty: In cosmetics customer loyalty plays crucial role. Once the customer is satisfied by a product, she repeats buying from the same brand. Indeed it is difficult to satisfy a customer as women always want the better look. Customer may use products from different cosmetics brands, for instance foundation brand may be different than the mascara brand. C ompetitor:Although M.A.C is considered the only brand in professional makeup products, Dior, Chanel, Lancome, e.g. are some competitor brands that also offer luxury cosmetics. Strengths of these companies are as follows: They invest greatly in mass advertising and increase brand awareness. There are frequently new launched products with high promises. Compared to these companies some of which has 70 years history, M.A.C is a new firm. As population gets older, these brands are more advantageous since they stand out with anti aging product lines. Weaknesses of the competitors can be summed up like this: First of all their prices are much higher. As they spend heavily on ads they have high costs, too. The most important thing is that cosmetics is not the only business they are in. They are involved even in fashion which shadows that they are associated with cosmetics at first.

BIG PICTURE Business ObjectiveCorporation:M.A.C Cosmetics Business Division Unit: Makeup productsM.A.C (Makeup Art Cosmetics) was founded by two men in 1984 with the aim of meeting specific makeup needs under studio lights. Later they were available to public and became known as a luxury cosmetic line that offers quality makeup products such as products for skin and hair care, beauty products, and cosmetics, created for everyone at reasonable prices in order to let everyone afford the experience of wearing professional makeup products.Core Competence: They offer the ultimate professional makeup experience at reasonable prices with an opportunity of high variety of color options.Goal: Their current primary goal in Turkey is to increase market share in professional makeup sector by attracting stylists and artists and provide superior quality makeup products to the fashion industry in Turkey. They are also trying to acquire non-professional customers but this is their seconda ry goal. Marketing Objective:Our marketing objective is to acquire new customers and the former customers. As related to our marketing objective, we aim to educate the target market in terms of the specifications of the M.A.C make-up products and lead them to try these products. There is a prejudice about the price of the M.A.C products. Most of the women think that it is one of the most expensive cosmetics brand. If we become successful about making them try the products, they will actually see that prices are lower than the competitors. Also, there are some customers who have tried one of the products of M.A.C but haven??t made repeat buying. They are also our target for the marketing objective. We will try to remind the brand to them and make them buy other products of the M.A.C brand. Source of volume: As part of acquisition strategy aim to steal share from our competitors. We are not going to stimulate demand for which is not appropriate for make-up industry and M.A.C?? s market share. STP:Segment: The segment can be divided into four segments according to ages and lifestyles. First segment is young women between 18-25 who are students or recent graduates. They are energetic, like going out with friends, follow movies theaters as well as concerts. They make up mostly when they go out. Second segment can be also called yuppies, women with successful career. They make up almost every day when going to work. They are single or newly married. They are open minded, pay attention to self development. Next group is composed of older women who need professional make-up to cover flaws on their body. They are from medium, upper medium income and their make-up share of valet is greater than the other segments. Last group is makeup professionals such as makeup artists, aestheticians, cosmetologists, hairstylists, models, photographers. They need long lasting, effective make-up with a wide choice of color. Make-up determines the quality of their busines s. They follow up latest trends and new launched products. Target: M.A.C??s acquisition strategy should target young business women, who like to socialize and pays attention to their style. That is the second segment mentioned above. They like to explore and test new products, thus fit to acquisition strategy. Positioning For young business women, the M.A.C Cosmetic make-up products is the best way of expressing their energy and beauty because it has the best quality make-up products with a wide range of color options.Promotion Matching with our marketing objective we are trying to inform our target segments and change their buying behavior. We will inform them not through promotion campaigns but with commercials, magazine ads and billboard ads. Our commercials should emphasize the quality and the wide color options of the M.A.C make-up products which bring the inner beauty of the women out. M.A.C Cosmetic products are associated with inspiration and the television commercia ls should be as colorful and shiny as possible which will give the feeling of stylish cosmopolitan women. Since our target segment is young business women, an image of a business woman who is confident about herself and successful in her life will attract them. She should use the make-up products at all the times during a day, at work, outside or at a party. Also, a foreign celebrity may be used in the commercials. Young business women follow the trends and the stylish people worldwide so if they see a foreign celebrity on the ads, they will feel like a celebrity themselves. On the other hand, the celebrities should not just emphasize the brand. They should be shown as a young business woman during a film shot or in the runway. Also, they should be shown as they use the product in their own daily lives.Magazine ads should be more informative about the brand. The quality and the affordable price should be emphasized on the magazine ads. Also, the concepts launched by the M.A. C Cosmetics such as ??Hello Kitty Collection?? should be covered in the ads. Also, the celebrities used in the commercials should be on the billboards. They should remind the commercials and emphasize the brand name. Also, the color options should be used as the main component of the billboard ads.

Creative BriefM.A.C??s Problem: In the Turkish cosmetics market, M.A.C does not have the reputation it deserves since still most of Turkish women are not aware of the M.A.C cosmetic products. Although most of women know the brand, they are not aware of the product specifications. So Awareness about the brand should be created and the make-up products of M.A.C in the market. They are not as well-known as their competitors such as Dior, Guerlain, Lancome, Max Factor among their local customers in Turkey. Mostly when Turkish people think of makeup, M.A.C Cosmetics is not the company that comes to their minds first. The Target Audience: Since they are already a recognized cosmetics firm in the fashion industry in Turkey, They should focus on acquiring young, middle-aged business-women who prefer luxury professional makeup products.Consumer Insight:The target market is constituted of young-middle aged business-women that are willing to pay more for the ultimate makeup experienc e. They like to feel beautiful and confident about themselves and they are not very price-sensitive when purchasing quality makeup products that make them feel good about themselves. They care most about the quality of the makeup product, then the reputation of the brand, its match with their skin and the variety of colors that are offered. Most young business women in Turkey are not aware of the wide color options of M.A.C and even though they heard before about the brand, most of them prefer other professional brands. The Brand Position:The most important features of the M.A.C Cosmetics products are the quality, wide range of color options and the compatibility of the product with all types of skin (e.g. dry or oily skin). The competitive advantage of M.A.C Cosmetics is that it offers professional, quality products at affordable prices as well as the experience of professional makeup in the stores by the makeup artists. They feel confident and beautiful since they are trea ted like celebrities. Since make-up artists and stylists also use M.A.C. in professional settings, customers tend to buy the products to feel like a celebrity.Brand Imperatives: M.A.C Cosmetics is a truly innovative company that has products that are professional, high quality, inspiring, colorful, joyful that reflects passion and fun. M.A.C offers not only a high variety of quality products but also the ultimate experience of a professional makeup in its stores since its salesmen and saleswomen are also makeup artists. They are closely connected with their customers and they are willing to make their customers look and feel good on the outside and on the inside. Their image is associated with celebrities such as Madonna and Gisele Bndchen who are considered as always young and dynamic, beautiful and confident. Proposition: Every business woman who takes care of herself and use make-up products will feel confident about herself and feel like a celebrity at all the times at a ll the places. Support: Celebrities are the people who are loved and appreciated by others. They are the successful and famous ones. The business women of today are more confident about themselves and want to be appreciated by others as well. So, the celebrity image attracts them and by using this image we aim to position the M.A.C products as attractive as a celebrity.Communication Objective: By touching the beauty motive of the women and leading them to try the product.Communication Strategy:Their future primary strategy in the short term should be to create awareness among the young businesswomen in Turkey. They are already well-known among professional artists and it is a profitable firm considering their sales to stylists and makeup artists but their aim should be to spread this success among the individuals that prefer luxury makeup products. M.A.C does not rely on advertisement since they believe word-of-mouth is a sufficient powerful tool to be recognized as a succes sful firm and they never tried to target a certain group, but however considering the local market in Turkey, since they are not as much well-known as their competitors such as Lancome, Dior, YSL among Turkish women they should focus on creating brand awareness and establish loyalty. Therefore they should target a specific segment and in order to educate the market about the quality and variety of M.A.C Cosmetics products they should use commercials on TV since it is the most preferred medium in Turkey that helps to reach much more people compared to the other mediums

Exhibit 1: Official spokespersons in the past

? Sandra Bernhard, a former M.A.C model (Pool Party collection), inspired the 'Sandy B.' lipstick? Diana Ross, M.A.C Beauty Icon 2004? Liza Minnelli, M.A.C Beauty Icon 2005? Catherine Deneuve, M.A.C Beauty Icon 2006? Amanda Lepore, starred in a feature length M.A.C lipstick and *Heatherette bag ad? Raquel Welch, M.A.C Beauty Icon 2007? Paulina Rubio, collaborated with M.A.C to create "Rubia" lipstick? Barbie, as part of their 2007 line "Barbie Loves M.A.C"? Eartha Kitt, for their 2007 pre-fall "Smoke Signals" color collection? Alexander McQueen, collaborated with M.A.C to create "M.A.C for McQueen" collection for his fall runway collection? A-mei, collaborated with M.A.C to create "M.A.C for A-MEI" collection 2008? Fafi, collaborated with M.A.C to create "M.A.C Fafi!" collection 2008? Heatherette, collaborated with M.A.C to create "Heatherette" collection 2008? Wicked, uses M.A.C ChroM.A.Cake in Landscape Green for character Elphaba? RuPaul, the first spokesmodel for M.A.C and for Viva Glam I? K.D. Lang for Viva Glam II? Lil' Kim for Viva Glam III? Mary J Blige for Viva Glam III and IV? Shirley Manson for Viva Glam IV? Elton John for Viva Glam IV? Christina Aguilera for Viva Glam V? Boy George for Viva Glam V? Linda Evangelista for Viva Glam V, and also helped (unofficially) promote "Spice" Lip Pencil in the '90s? Chloe Sevigny for Viva Glam V? Pamela Anderson for Viva Glam V? Missy Elliott for Viva Glam V? Eve for Viva Glam VI? Debbie Harry for Viva Glam VI? Lisa Marie Presley for Viva Glam VI? Dita von Teese for Viva Glam VI, and also was the model for the "Nocturnelle" collection visual? Fergie, for Viva Glam VI Special Edition Lipglass? Lacey Moseley of Flyleaf, used M.A.C Cosmetics for Flyleaf's "Sorrow" music video.? Emanuel Ungaro, collaborated with M.A.C to create "Emanuel Ungaro collection" for fall 2008? Dame Edna, collaborated with M.A.C to create "Dame Edna collection" for winter 2008? Manish Arora, collaborated with M.A.C to crea te "M.A.C for Manish Arora" for fall 2008? Hello Kitty will be a "spokesperson" for M.A.C in spring 2009? Madonna is said to have inspired "Russian Red" Lipstick? Radio City Rockettes, all Radio City Rockettes wear 'Russian Red' lipstick for performances? The Saturdays, currently sponsored by M.A.C on their official website.

Exhibit 2: Survey results

The survey conducted to 15 women, who are on average 24 years old, reveals that quality and reputation of the brand come first in make-up product choice. Next important criteria is the product??s compatibility with the skin. It is seen that price sensitivity is low. The competitor firms like Chanel, Lancome and Dior stand out M.A.C in the reputation. Again, Chanel is the top ranked firm from quality point of view followed by M.A.C. On the other hand, M.A.C stands out with the variety of the colors. The brand is mostly associated with beauty, glamour and professional. As celebrity personality Madonna and Gisele Bundchen are selected most (equal).





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