ARAB ACADEMY FOR SCIENCE AND TECHNOLGY

GRADUATE SCHOOL OF BUSINESS

Revlon, Inc. 2007
Strategic Management Case Study
Prepared By: Mohamed Gaber Eldamati 3/30/2012

Submitted to: Prof. Tarek Abdeen

.................................. 3 Comments: ................................................................................................................................................................................................ 7 Internal Factor Evaluation (IFE) ................................................................ 3 Revlon Mission Statement.................................................................................................................................................... 3 Revlon Opportunities .................................................. 3 Current Mission Statement: .................................... 5 External Factor Evaluation (EFE).......................................................................................................................................................................................................... 3 Proposed Vision Statement: ................... 8 2 Revlon Vision and Mission Statements ...............................................................................................Table of Contents Revlon Vision and Mission Statements ...................................................... 6 Revlon Strengths .................................. 4 Revlon Threats .......................................................................... 5 Comments: ........................................................................................................ 3 Revlon Vision Statement .................. 3 Comments: .... 7 Revlon Threats ...................................................................................................................................................................................................................... 3 Current Vision Statement: ................................................................................................................................................................................... 8 Comments: .................. 4 Competitive Profile Matrix (CPM) .......... 6 Comments: .....................................................................................................................................................................................................................................................................................................................................................................................................................................................................................

Concern for employees—Are employees a valuable asset of the firm? 3 Revlon Vision and Mission Statements . Customers—who are the firm’s customers? 2. Concern for survival. excitement and Innovation through cosmetics quality products at affordable price. excitement and Innovation through quality products at affordable price. growth. Philosophy—what are the basic beliefs. Self-concept—what is the firm’s distinctive competence or major competitive advantage? 8. health conscious women (skin care). Comments: The statement is too vague. community. and elder women(1) with its variety of brands. and ethical priorities of the firm? 7. Comments: As per our model the Mission Statement should include the following Components 1.Revlon Vision and Mission Statements Revlon Vision Statement Current Vision Statement: To provide glamour. values. Markets—geographically. Revlon Mission Statement Current Mission Statement: To emerge as dominant(5) cosmetics and personal care(2) firm In the Twenty-First century by appealing to young/trendy women. Products or services—what are the firm’s major products or services? 3. aspirations. where does the firm compete? 4. and environmental concerns? 9. Technology—is the firm technologically current? 5. Concern for public image—is the firm responsive to social. and profitability—is the firm committed to growth and financial soundness? 6. it should reveal cosmetics industry Proposed Vision Statement: Provide glamour.

even the competition for African American market has increased with the entry of brands like Fashion Fairs and cosmetics lines launched by Patti Labelle) Some competitors of multinational companies are offering more than just skin care and makeup products Disposable income of Americans decreasing Consumers’ concerns about product safety and CSR activities 4 Revlon External Assessment . Commitment to providing secure & challenging work environment (9) and to a willingness to embrace new ideas and learn continuously (6) Revlon External Assessment Revlon Opportunities            Increase in US teen market 20 million by 2010 Asian markets still 60% uncovered by Revlon Increase in online retailing Women in China. India and middle East are rapidly growing interest in purchasing more cosmetics Sales of personal care products increased from 428 to 499.4 in 2006 which indicates a new trend Men also using the cosmetic products Expansion in Hair coloring market among youth The young migrants to America are increasing Latin America represents a growth opportunity Older age women entering into the cosmetic industry Baby boomers have high levels of disposable incomes Revlon Threats      Racial and ethnic changes in US market Intense competition (so many brands offering the same stuff.As we see Revlon mission statement covers only 3 components which are Customer. Product and concern for survival Proposed Mission Statement: To emerge as dominant (5) firm enriching women (1) lives all over the world (3) with unique innovative (7) cosmetics and personal care (2) products.

24 4 0.1 0.22 2. 4 = major strength.32 2 0.3 4 0.12 1 Note: The ratings values are as follows: 1 = major weakness.16 3 0.24 4 0. 2 = minor weakness.32 2 0.1 0.24 2.2 3 0.36 2 0.45 2 0.1 0.62 0.3 2 0.6 4 0.12 0.45 2 0.2 3 0.2 3 0.08 0.3 2 0.15 0.24 2 0.48 3 0.2 2 0.3 4 0.08 0.15 0.64 is above the average so it is doing partly well.45 4 0. Comments: Revlon total weighted score of 2.4 3 0.  Major retailers reducing inventory levels due to recession Decrease in the value of dollar Competitive Profile Matrix (CPM) Critical Success Factors Price competitiveness Global Expansion Product Safety Customer Loyalty Market Share Advertising Product Quality Product Image Financial Position Total Weight Revlon Rating Score 3 0.16 2 0.36 3. Revlon is the strongest on market share compared to its competitors 5 Revlon External Assessment .4 3 0.45 3 0.16 2 0. 3 = minor strength.64 Procter & Avon Gamble Rating Score Rating Score 3 0.

32 0.08 0. 6 Revlon External Assessment . 6.04 0.04 0. 5. Expansion in Hair coloring market among youth 8. Some competitors of multinational companies are offering 4.External Factor Evaluation (EFE) Key External Factors Weight Rating Weighted Score Opportunities 1. Racial and ethnic changes in US market 2. more than just skin care and makeup products Disposable income of Americans decreasing Consumers’ concerns about product safety and CSR activities Major retailers reducing inventory levels due to recession Decrease in the value of dollar Total Note: The ratings values are as follows: 1 = the response is poor.05 0. Men also using the cosmetic products 7.07 0.28 0.1 0. Increase in online retailing 4.7 6. Asian markets still 60% uncovered by Revlon 3.07 0. The young migrants to America are increasing 9.05 0.08 0.05 0.7 is above the average so it is doing partly well in terms of responding towards appropriate threats and opportunities.36 0. 2 = the response is average. Baby boomers have high levels of disposable incomes Threats 1. 7.15 0.06 0.15 0.15 0. Sales of personal care products increased 0.12 0. 4 = the response is superior. Increase in US teen market 20 million by 2010 2. Older age women entering into the cosmetic industry 11.04 0.06 0.04 0.05 0.09 0.04 0.08 2.04 0.16 0.04 0. Comments: Revlon total weighted score of 2.12 0. 3 = the response is above average.04 1 3 4 4 3 3 3 3 3 4 3 4 1 1 2 2 2 1 2 0.1 0.21 0.1 0.1 0.05 0. Women in China. India and middle East are rapidly growing interest in purchasing more cosmetics 5. Latin America represents a growth opportunity 10.12 0. Intense competition 3.

trendy. The brand was launched in 2006 but was discontinued as the customers didn’t respond to it. young. From the year 2006 – 2007. In 2003 Mac Andrews and Forbes Holdings Inc gave out $150 million. health conscious and older women Strong Social Responsibility programs Large mass merchandisers Great operating efficiency use of capital assets Continues new product development Big share of share of sales in the foreign market (43% in 2006) Net sale in 2007 increased from 2. later in 2006 an extension of $87million debt by Mac Andrews was made.6% after suffering a loss in 2006 The baby boomer chunk of the population tends to be brand loyal Joint venture of Revlon and Pacific World Corporation into establishing a new line of nail and nail care products Sales of products through internet Revlon Threats             Long term debt 2.4 million on R&D Aggressive Advertising worth 120 million Great operating efficiency and use of capital assets Quality manufacturing standards and having ISO-9000 certification Strong Brand recognition The company tries to introduce new products Produces products for all type of women.Revlon Internal Assessment Revlon Strengths                  $25 million was spent on CSR program Currently.2006) High net losses in 2006.3 billion. Negative impact of this product line was estimated to be $110 million Employ layoff by 8% during 2006 – 2007 Less diversified products compared with competitors Constant organizational restructuring Lack of financial resources Large amount of advertising expenses Decrease in current assets and increase current liabilities 7 Revlon Internal Assessment . $24. First there was a layoff of 15% before Kennedy in 2000 then another reduction of 8% when he took charge Higher prices than competitors Decrease in sales by 1 million (from 2005 . High restricting cost that amounted up to $29 million when David Kennedy was in command. which resulted because of the discontinuation of Vital Radiance and because of the long term debt Discontinued vital radiance in 2006.

06 0.03 0.04 1 3 3 4 4 4 2 3 3 3 4 1 2 1 1 2 2 1 1 3 0.03 0.04 0.07 0.08 0.4 million on R&D Aggressive Advertising worth 120 million Great operating efficiency and use of capital assets Quality manufacturing standards and having ISO-9000 certification Strong Brand recognition The company tries to introduce new products Produces products for all type of women Strong Social Responsibility programs Continues new product development 0.04 0.53 Weaknesses Extension of $87 million debt by Mac Andrews.3 billion High prices than competitors Decrease in sales by 1 million High net losses in 2006 Discontinued Vital radiance in 2006 cause $110 million negative impact Less diversified products compared with competitors Constant organizational restructuring Lack of financial resources Total Note: The ratings values are as follows: 1 = major weakness.Internal Factor Evaluation (IFE) Key Internal Factors Weight Rating Weighted Score Strengths $25 million spend on CSR program Spend $24.24 0. 2 = minor weakness.08 0. 3 = minor strength.12 0.24 0.12 0.36 0.08 0. Comments: Revlon total weighted score of 2.53 is almost equal to the average which indicates that there is definitely room for improvement in Revlon.2 0.14 0.08 0.04 0.06 0.09 0. 8 Revlon Internal Assessment .04 0.16 0. 4 = major strength.04 0.04 0.12 0.04 0.12 2.04 0.04 0.04 0.08 0.15 0. high restricting cost Long term debt 2.15 0.05 0.05 0.04 0.05 0.

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