STUDENT NAME: EELYNN YONG

SID: 1960

Establish and Adjust the

Marketing Mix
BSBMKG502 TASK 2
 CONTENTS

Company Overview.............................................................................................................................................................. 2
The Product’s Key Characteristics................................................................................................................................ 2
Pricing Policy........................................................................................................................................................................... 2
Analyse the significance to market outcomes......................................................................................................... 3
Marketing Mix.......................................................................................................................................................................... 3
External Environmental Factor........................................................................................................................................ 4
Consumer priorities, needs & preferences................................................................................................................ 5
Evaluate New Products or Services............................................................................................................................. 5
Analyse the appropriate marketing mix....................................................................................................................... 6
Monitor the performance of the organisation’s products and or service.....................................................6
Evaluate the implications of altering one or more components of the marketing mix..........................7
Adjust components of the marketing mix................................................................................................................... 7

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 COMPANY OVERVIEW
The Body Shop values natural ingredients, animal-free testing, environmentally friendly
practices and a commitment to company values. The Body Shop was founded in 1976
in Brighton (UK) by Annita Roddick. The Body Shop prides its natural and eco-friendly
line of skin and hair care products. Purchased by L’Oreal in June 2006, The Body Shop
currently operates about 2,550 stores across 60 countries with a range of over 1,200
products.

Mission Statement:

 To dedicate our business to the pursuit of social and environmental change.

 To creatively balance the financial and human needs of our stakeholders
employees, franchisees, customers, suppliers and shareholders.

THE PRODUCT’S KEY CHARACTERISTICS

The Body Shop markets over 1200 products, which can be classified into seven broad
groups:

• Skin products: body lotions

• Body products: deodorants
• Makeup products: lipstick, foundation, mascara
• Fragrance products: perfume oil, eau de toilettes, eau de perfume
• Hair products: shampoo, conditioner, scalp treatment
• Aromatherapy products: massage oil, relaxing body treatments
• Hands and feet products: foot scrub, cooling leg gel, foot spray, hand cream

PRICING POLICY
In order to get the suitable price The Body Shop seeks to establish economic
partnership with indigenous suppliers, thereby making them economically self-
sustaining and not dependent on the shops’ largesse resulting in low cost products.

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 ANALYSE THE SIGNIFICANCE TO MARKET
OUTCOMES
a. Promotion Method
 Public Relations – sensitize customers, bonding, creating value
relationships with their consumers, collaboration with charitable
foundations, United Nations, MTV, create awareness campaigns, posters.
 Inform Public – Best sellers, Members Special, Best Buy, Discounts,
Newsletters, Winter treat offers, E– brochures, On facebook, Mobile
Coupons
 Love your body - is unique members club that rewards you with
discounts, free gifts and access to the kinds of perks and privileges only
club membership brings

b. Customer base
 Middle to upper-class women who live in a city or suburban area due to
store placement being near major cities.
 The Body Shop’s consumers consider themselves well informed, and
knowledgeable about the environment, politics, and new health trends

c. Channel of Distribution
 International location
 Website for selling the products and home delivery
 Run on franchising basis

d. Level of customer service provided

 The Body Shop provides a high level of customer service that if customers
are not satisfy with the product, they can ask for refund or change to other
products within 30 days after purchase date.

MARKETING MIX
Product, packaging and promotion are the most important factors which has helped the
Body Shop in creating its brand equity.

 Products
The product profile of the Body Shop includes more than 400 body care products
and approximately 500 sundry items. They also provide customized care
products as per the requirements and preferences of their customers. Natural

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 elements such as fruits, vegetables, flowers and the herbs are the main
ingredients used in their products. Perfume bar that can be used for scenting oils
and lotions are provided at every store without charging anything extra for the
same. Services like making gift baskets, free makeovers and foot and hand
massages are also provided at their stores.

 Price
The prices of the products of the Body Shop fall in the price range of low to
medium depending upon the product. However, most of the products falls in the
affordability of majority of the users.

 Place
The company has the more than hundred stores in Australia. These stores have
been opened with the aim of connecting with the consumers belonging to young
age group.

 Promotion
The Body Shop has never supported the idea of promoting their products. They
just believe in informing people and provide information about all their products
on their internet site. Excessively thin or young models are never a part of the
promotional activities of the body shop.

EXTERNAL ENVIRONMENTAL FACTOR

Political factors

• Unstable political situation in Guatemala from where the cosmetics companies

source Aloe Vera
• Unstable political situation in Peru: the country is a source of Brazil nut oil from
the Amazon forest in Peru

Economic factors

• The falling interest rates play in the favour of the company’s franchising policy as
growth strategy.
• Exchange rate

Social factors

• Raised awareness regarding fair trade

• Raised awareness regarding natural products/animal testing.
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 • Ageing population (willingness to spend on premium-priced products claiming
anti-ageing properties)

Technological factors

• Dangerous chemical and acidic components such as some acid used in beauty
and cosmetics products may be harmful to people’s melanin count in skin.

Environmental factors

• Recycling/disposal of by-products
• Concern for deforestation (Supply of palm oil and brazil nut oil from forests in
conserved areas)

CONSUMER PRIORITIES, NEEDS &

PREFERENCES
Customer care therefore has become a crucial part of the trading policy. The Body Shop
customers demand not only high quality, value for money products, but also recognise
the need for environmental responsibility. The customer needs to be well-informed in
order to make responsible choices.

EVALUATE NEW PRODUCTS OR SERVICES

As the men, become more conscious of their appearance, and grooming, there is a
trend developing in the cosmetic industry and market. These individuals are tag as the
Metro sexual market. Based on research, male grooming products such as body wash,
deodorant, hair gel, shaving cream, razors, moisturizer, etc., make up one of the
markets that now lead the overall cosmetic markets in many regions of the world,
despite the present economic down turn. This provided an opportunity to expand the
market of Body Shop and increase in market share.

Body Shop’s increasing online activity in the light of rising online sales, should reduce
its operating margins by reducing operating cost, leading to greater profitability.

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 ANALYSE THE APPROPRIATE MARKETING MIX
The most appropriate marketing mix is

 Product
o Increase the target customer’s perceived value for protecting the
environment and the strength of natural ingredients
o Issue a marketing campaign with celebrities who stand for natural beauty
 Emphasize the importance of saving the planet
 Improve the trust in natural products
 Price
o Give more test samples to compensate for the high prices and show the
good quality of the products
 Promotion
o Establish a friend referral program so that friends can send “free trial
vouchers”
o Provide the membership card for getting more loyal customer and give the
special promotion for the members.
 Place
o Arouse customers to buy the product from website in order to reduce
operation cost.

MONITOR THE PERFORMANCE OF THE

ORGANISATION’S PRODUCTS AND OR SERVICE
To monitor the performance, the company can use questionnaires and surveys to get
the feedback in order to know their satisfaction of the products and what the products
that they need the company to develop or improve. Getting customers to put their
thoughts in writing on a questionnaire or survey is one of the most well-established
feedback techniques.

Placing a new product in selected stores to test customer response under real-life
selling conditions can help the company make product modifications, adjust prices, or
improve packaging. Small business owners should try to establish rapport with local
store owners and web sites that can help them test their products.

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 EVALUATE THE IMPLICATIONS OF ALTERING
ONE OR MORE COMPONENTS OF THE
MARKETING MIX
The Body Shop was the first brand to have all natural, organic body care products. This
is a distinct strength, because it shows that The Body Shop was creating such products
for the intent of pure benefits and not just because it’s a hot commodity in the industry.
This proves to customers that The Body Shop is true, authentic, sincere, and knows
what making all natural products is all about.

Another noted trait is that The Body Shop is very communicative on its social media
pages. For example, when people post complaints/comments on its Facebook page, a
Body Shop representative always comments back with an added personal touch. In
addition to responsiveness, the shop is consistently promoting contests and giveaways,
which is a great way to encourage interaction among users and with The Body Shop
itself.

Furthermore, in relation to one’s in store experience, everything is kept very clean and
simple. All of The Body Shop stores keep the signature dark green and gold color
scheme with the company logo.

ADJUST COMPONENTS OF THE MARKETING MIX

a. Budget requirements
The Body shop required the overall budget that is $500,000 per year. It has been
set aside for social media advertising through Facebook and Twitter providing
updates on new products that are movie theatre advertisements, elevator screen
displays, in-store promotions, and inserts in Sunday newspapers.

b. Organisation strategic objectives

Body Shop has already developed a niche market for itself, with its wide range of
naturally made products. Niche marketing is one of the strengths of the company,
and for it to improve its market share and sales figure, it has to continue to drive
these products in the markets it has already established. Maximization of this
strategy can be gotten by the right manipulating the marketing mix, aimed at the
right market segment.

c. Operational marketing objectives

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 The operational marketing objective is to move into new market regions, with
shops opening in places like Russia, Jordan, India, and Poland to mention a few.
This growth in cosmetics and toiletries is expected to be catalysed by the rising
level of personal hygiene and beauty awareness due to changing lifestyles,
increasing incomes of people, greater media exposure in form of advertisement,
and more better improved product ranges. This strategy will augur well for growth
in company.

d. Desired market positioning

The Body Shop is actor in one of the fastest growing business industries. The
company is a global operation with people working towards sharing common
values, which has given the shop a campaigning and commercial strength
approach towards the cosmetic industry. Although there has been no significant
changes in their marketing strategy the store has had to adapt to its consumers
at a time where the economy has been at its worst

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