INTRODUCTION BACKGROUND The body Shop is one of the most famous retail brands in the world, noted for

its range of naturally inspired skin and hair care products and ethical values. The name behind the famous cosmetic shop, is Anita Perella Roddick, who used to be a part-time teacher. Anita Parella Roddick traveled to different places like Madagascar, Mauritius, Australia and Reunion; she was mesmerized by the organic products that women in the Polynesian islands use to nurture their bodies. When she went back to England, she married a Scotsman poet and traveler named Gordon Roddick in 1971. During the 1970s, when Anita and her husband Gordon-Roddick were visiting San Francisco, they came across a store in Berkeley, which was called “The Body Shop” and founded by two locals. The two locals was also publicly promoting environmental concerns, they even offering price cuts to customer to encourage them to bring their own bottles instead of buying new ones. The right to the name “The Body Shop” was then sold to the Roddicks in the early 1980s, while the original store continuing their business in the Bay Area under the name “Body Time”. In the mid-1970s in United Kingdom, The very first Body Shop was established and offering products made using natural and exotic ingredients, without testing on animals. The Body Shop experienced rapid growth, expanding at a rate of 50 percent annually. The stock was then given a nickname “the shares that defy gravity” as the price increased by more than 500%. In March 2006, L‟Oreal took over The Body Shop. The Body Shop operates as a distinct entity, with its own Board and Executive Committee within the L‟Oreal Group. The business continue to expand, till year 2010, the total number of locations for The Body Shop exceeds 2605, trading in 61countries.

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The number of stores in different areas. Loreal 2010 Financial Statement 2 . year 2005.

when Anita used the window of The Body Shop store to campaign to “Save the Whale”. they are “Stop HIV”. And only 8 who do”. “Stop Sex Trafficking” and “Stop Violence in the Home”.Besides being well known for the rapid growth. they ran a now famous headline: “There are 3 billion women who don‟t look like supermodels. The Body Shop is also well recognized for social responsibilities programs. being the first retailer to speak out on selfesteem issues. and won a UK-wide ban against animal testing on cosmetic products and ingredients with a largest petition in history against animal testing. Today. The Body Shop have also campaigned for. The Body Shop campaigns focus on three of the greatest challenges of our time. In 1997. MISSION STATEMENT 3 . The first major campaign for The Body Shop is in years ago.

This is to ensure that the business will live by the mission statement. They stay on top of the latest developments in order to provide the highest quality of product possible. The Body Shop will be entering a market that is well educated on environment issues and desire for organic products. 89% of The Body Shop Loyal customers think that it was very important to source in a responsible manner. due to the sustained commitment to animal welfare. The Body Shop was twice the winner for the Royal Society for Protection of Cruelty against Animal (RSPCA) Good Business Award. Values Based on the mission statement. According to a survey conducted. Besides that. it will also act as a practical guide for decision making at all level in the company. The Body Shop were awarded a Big Tick by Business in the Community for our Community for their Community and Ethical Trades Programs. In 2007. The Body Shop will retain customer.The mission statement of The Body Shop shows their deep dedication to their customers and also the environment we live in. The profits have to be made by principles. The Body Shop created 5 core values. 4 . they believe that as long as the quality of the products remain consistent with fair pricing. treating people in the company‟s supply chain with dignity and respect.

Some experts have warned about the potential adverse effects on the skin of some of the synthetic ingredients. For example. 5 . it was later discovered that The Body Shop products contains chemicals that was made in laboratories.CENTRAL PROBLEM The main problem that The Body Shop faces is the unethical conduct of The Body Shop top management and its policies which resulted loss. The main problem for The Body Shop is the unethical conduct of the founder. As the essence of the products is the unique selling point. The Body Shop has assured that they only used natural ingredients in their products. SUB PROBLEMS 1. It was not only that. As a result.radiation is generated from dangerous non-renewable uranium which cannot be disposed of safely. In the year 1993. the company was plagued with numbers of controversies. protesting against the testing on animals. fragrances and preservatives. However. The Body Shop no longer focus on the “ethical business” aspect of generating revenues as indicated in the mission statement. between year 1995 and 2000. synthetic colors. The Body Shop did not mentioned the original sources of the ingredients used on the package as other marketed products did. and in many of their products they use only tiny amounts of botanical-based ingredients. However. 151bottles of contaminated Banana Shampoo were sold to consumers in the USA. campaign against human rights abuse. Besides that. In fact like all big cosmetic companies The Body Shop make wide use of nonrenewable petrochemicals. even there were reports stating that Body Shop was selling contaminated product supplies to the consumers. environmental protection and social uplifting activities. Claims on the natural ingredients used in The Body Shop products. the organic or natural sources were not mentioned. The Body Shop also regularly irradiates certain products to try to kill microbes . The main reasons for the brand recognition are their programs related to social problems and environmental issues.

3. like those of all multinationals. Furthermore. plant in 1992 which then caused problems at a water treatment plant back to The Body Shop plant. have a detrimental effect on the environment. Body Shop has been embroiled in a furor over its 'green credentials' since it emerged that a US ethical investment fund had sold 50. this program is but one part of a portfolio of income sources available to the Kayapo. The Body Shop has also run into regulatory problems at its new plant in Wake Forest. Critics on the environmental issues towards The Body Shop. The Trade not Aid Program by the Body Shop. But behind the green and cuddly image lies the reality The Body Shop's operations. who are unnamed.000 of its shares because of concerns over its environmental record. it is in fact a wage labor relationship whereby the Kayapo are not compensated for the real product they provide The Body Shop: their photographic image. North Carolina. The Body Shop has successfully manufactured an image of being a caring company that is helping to protect the environment. was responsible for two spills of shampoo and shower gel from its Hanover. and does not prevent them from engaging in environmentally exploitative contracts with loggers and miners. A former US Body Shop environmental officer has accused the company of hypocrisy and putting manufacturing priorities before environmental concerns. instead of flowing into the city sewer system. There were few critics made towards The Body Shop on its trade not aid program. The FDA documents said the allegations were made by 'former and current employees at this firm (who) contacted the informants'. New Jersey. which was visited by US Food and Drug Administration inspectors. The Body Shop's new US headquarters are on a site whose groundwater is contaminated from emissions by a previous owner. Its drainage is handled by a septic system. The Body Shop. Even though the “Trade Not Aid” program undertaken by The Body Shop in Kayapo communities has been touted as the realization of the “Rainforest Harvest” approach to conservation. which prides itself on its green credentials.2. and so should not 6 . The FDA officials recommended the firm correct certain practices after finding problems with product samples and plant-cleaning records.

which in spite of the real differences between them applies in some measure to both. however. Stephen Corry of Survival International.000 in damages. The Body Shop‟s “Trade Not Aid” program has come in for a good deal of cogent criticism. The Body Shop‟s policy. Animal testing done by The Body Shop. "They accept ingredients tested on animals before 1991. has distinguished between straightforward “fair trade” projects designed to help local communities produce for local markets. Claims on charity issues. However. the battle had focused attention on the Body Shop‟s ethical record and inspired additional criticism. The most trenchant of the critics.5% of its pre-tax profits for charity. while responsible charitable organizations such as Patagonia and Ben & Jerry‟s contribute 10% and 7. required rejecting all ingredients that had been tested on animals in the previous five years. Though the Body Shop was against the testing of products on animals. Although the company won the suit. charged the company with using ingredients that had been tested on animals.be seen as an exclusive alternative to environmentally damaging land use practices. they are facing counter evidence of their extensive use of ingredients that have been tested on animals by other companies. One fierce attack came from a British television program entitled “Body Search” which accused The Body Shop of misleading customers with its “Against Animal Testing” product label. The Body Shop's animal-loving image is still under suspicion. The critics claim that. The TV program. Some Body Shop products even have animal parts such as gelatine (crushed bone). The reputation of the Body Shop for charitable giving had been an issue among the critics. 5. or those tested since then (if they were animal-tested for some purpose other than for cosmetics)". on terms that guarantee them a fair return for their products (which he supports). it was found out according to an internal memo of the company in 1992 that almost 50% of the company‟s products were tested on animals. Although the Body Shop identifies their products as "animal-testing free". the Body Shop is contributing around 3% of its pre-tax profits. the figures do not take into account 7 . 4. The Body Shop brought a suit against the television station 1993 and won £276. designed as an incentive for companies to eliminate their animal testing. In one word.

environmental protection and socially uplifting activities. By meeting the customers‟ needs through the provision of high quality. These charity supports lead The Body Shop being the second trusted brand in United Kingdom and the founder Anita was popularly know.the voluntary activities undertaken by the employees of the Body Shop and the contributions made by the customers. the niche marketing in The Body Shop also one of its strengths. had received numerous awards as well. Different fund raiser activities such as sale of red ribbons during World Aids Day and collection of funds from the customers in „Violence Against Women‟ campaigns also contributed to the charity activities conducted by the company. on other hand. home fragrance. 8 . Through narrowing the market away from the mainstream. The founder. Besides that. SWOT ANALYSIS STRENGTHS One of the strengths for The Body Shop is brand loyalty. bath. Anita Roddick can successfully build up the business of The Body Shop was through protesting against the testing on animals. but. The essence of the products which is made of natural ingredients is the main selling point for The Body Shop. campaigns against human rights abuse. aroma therapy. good value products with exceptional service and relevant information will let the customers felt of the sincerity of The Body Shop and stay turn with their products. it is never an easy task to satisfy every customer needs or wants with a sole product line. Since every customer has different expectation. it may be included less potential customers. skin care. fragrance. There are several of product lines offered by The Body Shop such as body care. The strength in The Body Shop is the charity support. make up. Loyal customers are important as they provide continuous profit to a company and it also provides the basis for brand development and improvement. hair care. men‟s and accessories. it is actually benefit to the company because can satisfy various types of customers in market.

9 . The Body Shop also weak on their restructure strategy. The action taken by Patrick Gournay had lead to the losses of the company. OPPORTUNITY One of the opportunities for The Body Shop is the pioneer of using natural ingredient in cosmetic product. For instance. but at least in an appropriate way. Therefore. The Body Shop will gain the competitive advantages as a pioneer over those starts later because it already builds a customer base and benefits from the economies of scale as well. One of them is The Body Shop emphasis on social issues rather than business. This unsuccessfully restricting attempt shown that when the wrong decision is made. Besides that. products of The Body Shop is made by the natural ingredients which is totally different with others cosmetic product in market. The larger market in cosmetic line also consider as opportunity for The Body Shop.WEAKNESSES There are few weaknesses in The Body Shop. the combination of beauty and healthy concepts in the Body Shop products do really provide a potential market for it to grow since the products of the Body Shop is made from zero chemical ingredients. ladies are willing to spend their money in the pursuit of beauty. The global sales of cosmetics and toiletries are increasing every year and this show that cosmetic line is a potential market to be grown although there are lots of competitive brands in market. he immediately implemented a retrenchment of 300 staffs in order to cut off the cost of operation in company. No one even voice out their opinion of dissatisfaction on how The Body Shop operate their business. poorly motivated shareholder also is one of the weaknesses. therefore The Body Shop should not just emphasis on social issues rather than its business which may hurt company especially their shareholders. this may bring a negative impact to the company. This leads to tremendous loss of sales and everyone just mind their own business. Nowadays. It is always benefits to be the pioneer in a market which can gain the firstmover advantages. It was not to discourage the companies from caring on social issues. The existence of every business in market is to earn profit. Other than that. After the Patrick Gournay ascent to power.

THREATS The first threat faced by Body Shop is the public propaganda. For example. environmental protection. it may influence the business of the Body Shop itself. Trade not Aid program. The company had involved itself into activities which had ultimately led the company into clashes with political factions. This is to prove that The Body shop not only sell products but also care about social issues as well and repositioning its brand as the corporate socially responsibility. However. 10 . political involvements also consider one of the threats faced by the Body Shop. the company started to buy back the franchised outlets and offer them a job as the employees in the parent company. in the late of 1990‟s. outsiders claim that many of the products in Body Shop contain chemicals where the source was not mentioned. When these kinds of incidents keep happening. The actions taken by Body Shop towards the franchisees that are not willing to sell off their business turn negative impacts to his own. For instance. In addition. Next. This might be given an opportunity for its competitive brands to take over their business. The particular issues in which the Body Shop was challenged included its claims of natural ingredients. de-motivated franchisee also is the threat for Body Shop.The opportunity to reinforce the brand image is always there as we can see The Body Shop work tirelessly to win support from customer with its participation in the charity drive events. animal testing and the charity issues. The Body Shop used to operate with franchisee model in the beginning of business. Public might be influenced by the negative rumor and lose confidence towards the Body Shop‟s products. the Body Shop started a protest against the oil multinational Shell which had destroyed the natural habitats of the Ogoni tribesmen in Nigeria. Due to that. hand inventory started to accumulate and on the hand the Body Shop lost revenue and customers.

King described the new brand image as “masstige” that is it exist between mass market and prestige. in order to enable consumers to make preferences. 2. Repositioning The Brand Image In order to be a unique proposition. Unilever Group. This new design is often required to satisfy loyal customers when the visual appearance of a product has become tired on their mind while appeal to new audiences. the increasing competition and changing consumer attitudes. Being a green retailer is the core value at The Body Shop. have been significant factors in the company's struggle to realign and update its brand. The Body Shop took on a massive repositioning activity in early 2005. Colourful and bulging shelves had been replaced with attractive glass counters. Andy King (King) advocated that the need to reposition the brand to carve out a differentiated position in a crowded cosmetics market. Colgate-Palmolive. Apart from that. and having effectively created its own retail category. The company avoids excess packaging whenever possible. Several changes had been taken place in this strategy. L‟oreal Group. the new 'invent your scent' perfume counter and luxurious „Spa Wisdom‟ range had been designed to tempt those customers who would usually shop at the counters of a department store. The Body Shop‟s direct competition is from the brands name like Procter & Gamble. The Body Shop also made changes on its product packaging. They are 11 . The shop interiors had been changed from the traditional dark floors and walls to neutral tiles and hemp-coated backlit screens. The strong association between the company and its campaigning founder. It always has and always will be. Packaging A brand differentiates the attributes and benefits of products or services by their distinctive visual merchandising and promotion. The global marketing director of the company.ALTERNATIVES 1. Positioning is about the position a brand occupies in a market in the minds of consumers. The Body Shop has appeared slow to evolve its brand identity. Esteen Lauder and so on.

had been replaced with 'Boston round' containers with white caps which came only in large sizes.also creating the most Earth friendly packaging possible for their products. member‟s birthday special offers. Introducing Loyalty Card The Body Shop aims to expand its customer base in all the outlets through its world class customer loyalty program “Love Your Body”. free gifts and access to the kinds of perks and privileges in a whole year. all of our tubes and bottles are made with a minimum of 30% recycled plastics. These included the black-topped bottles. The company offered customers to sign up for 'Love Your Body' loyalty card with purchase a £5 (RM21. The membership card had been successful in attracting customers proven when the program was launched in the UK in 2004 after a successful five-year run in the US.60) loyalty card which can be used online and at any participating store. 12 . For instance. and therefore encourage. 3. and had amassed half a million members by mid 2005. "The Boston Round" gives it a fresh look and feel to reflect this innovative merchandise offer. The global cosmetics and toiletries industry which was growing at a healthy rate from 2000 also acted as a catalyst in this process. which used to come in three different sizes (fitting every pocket). The loyalty card rewards customer with an unlimited 10 percent discount. loyal buying behavior.

It is all about how the company merges as an outstanding Cosmetic and Toiletries Company among the competitors and became popular among the consumers. This is because after suffering from periods of losses. The new 'invent your scent' perfume counter and luxurious Spa Wisdom range. they come up with numerous changes made in rebranding the Body Shop's new brand as 'masstige' . Andy King. The change more apparent than in Body Shop's newly refurbished store in London's Covent Garden. offering the company the opportunity to compete with prestige brands. The Body Shop have to determine the needs. coupled with poorly motivated shareholders. wants.DECISION Based on the 3 different alternatives available. once a mecca for teenagers browsing for sweet-smelling bargains. the global marketing director of the company emphasis on repositioning the brand to create a differentiated position in this saturated cosmetics market. will get the same treatment. and 250 globally. It is one of 18 outlets across the world that has been given a facelift to prepare for the brand repositioning. erode into The Body Shop's traditional niche. Thus. After almost three decades.somewhere between prestige and mass market. Meanwhile. de-motivated franchisees. 13 . introduced in March. and interests of target markets and to deliver the desired satisfactions more effectively and efficiently than competitors in a way that preserves or enhances the consumer‟s and the society‟s well-being. Colourful and bulging shelves. Dark floors and walls have been replaced with neutral tiles and hemp-coated backlit screens. This is due to the high street stores such as Boots and newly emerging Lush Cosmetics have developed their own successful natural beauty products in recent years. we decided to choose repositioning the brand image. have been replaced with sleek glass counters. the trademark dark green 'box' has gone. unsuccessful restructuring attempts and public propaganda against the company. This year between 75 and 80 stores in the UK. are also designed to tempt customers who would usually shop at a department store beauty hall. there is a strong need for The Body Shop strives to reposition their brand image.

trade but not aid program. 14 . The Body Shop was still considered as prestige brand in Middle East and Asia which comprises of 25% of the global cosmetic and toiletries market which is supposed to leverage the brand needs. Increase in Sales and Profits Repositioning helps in make the sales and profits soars as a strong corporate image allow the company to charge more for the products. But due to some controversies in the mid and end of 1990 has badly affected the company image and affect the customer trust of this brand. as The Body Shop tried to restructure the internal company operation and also repositioning it brand image. the winning of Royal Society for prevention of cruelty to animals (RSCPA) was the life changing event for The Body Shop as it fights its survival. At the same time. Thus. customers become more confidence about the Body Shop products and they feel they have made the right decision by purchasing the products after the brand repositioning. 2. differentiate itself from other cosmetic line and proved that they really employ the best practice in terms of treatment to animals in the cosmetic. fashion and food industries. Most customers believe that they “get what they pay for”. Better quality often associate with higher price. Provides confidence regarding purchase decision The Body Shop has been advocating about the social issues such as natural products. environmental claim.IMPLICATION 1. 3. This can lead to improve mark up margins and profits of the firm. Good time seems to be back for The Body Shop and customer loyalty increased after The Body Shop successfully reposition its brand. Customer loyalty to the brand As the brand champion in few social and charity issues. global cosmetic and toiletries was growing at a healthy rate starting from year 2000 also acted as a catalyst in the process of repositioning The Body Shop‟s brand. animal testing and charity issues.

a fact emphasized on the mission statement. As a result. The company no longer focused on “ethical business” aspect for generating revenues. Its products we considered at the time "natural". Finally in March 2006 The Body Shop agreed to a £652. 15 . campaign against human rights abuse. the restructuring was in vain and it leads to more sales loss and the top management had to do massive repositioning activities in order to build its brand image again in 2005. the business during Anita reign had to suffer from tremendous loss and the Body Shop has restructured the company operations. The Body Shop company spark controversies on how ethical is the company to its commitments to the issues. the Body Shop is headquartered in Littlehampton. with much public and media interest.3 million takeover by L'Oréal. The Body Shop did not visibly market itself as committed to social causes. environmental protection and social uplifting events. including from petrochemicals. Unfortunately. England. West Sussex. The social activism dimension of the company begins in 1986 when The Body Shop proposed an alliance with Greenpeace in the UK to save the whale. The Body Shop regularly featured posters on shop windows and sponsorship of local charity and community events. however. Roddick began launching other promotions tied to social causes. criticizing what she considered the environmental insensitivity of the industry and traditional views of beauty. a Brazilian company. Roddick blossomed into a full-time critic of business in general and the cosmetic industry in particular.CONCLUSION From a small stall in Brighton England to 2400 stores in 61 countries and second largest cosmetic franchise in the world following O Boticario. Despite of protesting against animal testing. was founded in 1976 by the late Dame Anita Roddick and is now part of the L'Oréal corporate group. Over time. and aimed to change standard corporate practices. In its earliest years. which were also used as preservatives. the bright colors and strong fragrances were created by chemicals.

edu/TED/bodyshop. (2007). from The Body Shop Global Official Website./Inspection_copy_ICFAI2007.com – The Body Shop Introduction.my/ The Body Shop International PLC Values Report 2009.html.wikipedia.guardian. from http://www.thebodyshop.aspx The Body Shop Malaysia Official Website.com/_en/_ww/index. from 29 September 2011.oikos Encyclopedia of leadership. Retrieved 29 September 2011. Georgia Jones Sorenson. Rajiv Fernando. from www.org/. Retrieved 29 September 2011. The Body Shop: Social Responsibility or Sustained Green washing? Retrieved 29 September international. Retrieved 29 September 2011. from www.com/_docs/us/2010-annual-report/LOREAL-2010-AR-volume2.com. WHAT'S WRONG WITH THE BODY SHOP? Retrieved 29 September 2011. Retrieved 29 September 2011..htm The Body Shop (2011) Retrieved http://en..REFERENCES Debapratim Purkayastha .american.pdf 2011.com/essays/The-Body-Shop-Introduction/359360 16 .pdf Mc Donald‟s.uk/business/2006/nov/03/ethicalliving.org/wiki/The_Body_Shop Retrieved 29 September 2011.org/beyond/companies/bs_ref. Retrieved 29 September 2011. from http://www. Retrieved 29 September 2011 The Guardian – Interview with Anita Roddick. Retrieved 29 September 2011.oppapers. James MacGregor Burns L‟oreal 2010 Financial statements.loreal-finance. Goethals.co. from http://www. from http://www. TED Case Studies Is The Body Shop www1.mcspotlight. from Volume 4 edited by George R.environment OP Papers.thebodyshop. from http://www.

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