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Assessment International Marketing “Alvin Connor Introduction into Asian Market”

Vikas Gurudev, ID NO: 11010560


0 Sec 4.0 Sec 6 Sec 7 Introduction Company’s Information Cosmetic Industry Cosmetic Market In Asia Comparing Two Country’s India China Competitor and Market Entry Strategy Hindustan Unilever Ltd Conclusion Reference Page 03-04 04-05 05 05-07 07-10 11-12 13 13-15 16 17-19 This case study analyses and discuss the internationalization process of the “Alvin 2 .Content Sec 1 Sec 2 Sec 3 Sec 3.0 Sec 4 Sec 4.1 Sec 5 Sec 5.

The company has ambitions to ultimately take the Alvin Connor brand across the world (www. Luxembourg. Italy.thisismanufacturing. As Muhlbacher. it hosts 60% of the world's current human population (www. the largest economies in Asia are China. Japan. It covers 8. (2002) the international market goes beyond the export marketing and becomes more involved in the marketing environment in the countries in which it is doing business.879 billion people. managers concentrate on product markets. groups of customers seeking shared benefits or to be served with the same 3 . Based on Global Office Locations 2011. They are becoming increasingly popular overseas with regular exports to European countries including Sweden. but the largest when measured in purchasing power parity.Connor Ltd” a leading eco-friendly body care product it has been successful in the UK . Tokyo. London and Shanghai. Asia dominated the office locations with 4 of top 5 were in Asia. South Korea and Indonesia. Asia has the second largest nominal GDP of all continents. France. This research will focus on a company called Alvin Connor Ltd. established in October 2002. 2001). Asia is the world's largest and most populous continent. As of 2010. the Netherlands. Singapore. that is. it involves the firm in establishing manufacturing facilities overseas and coordinating marketing strategies across the globe (Doole and they are becoming universally available through independent whole food shops. Helmuth. international marketing involves the firm in making one or more marketing mix decisions across national boundaries. At its most complex level. Global marketing refers to marketing activities coordinated and integrated across multiple country markets (Johansson. Turkey and Cyprus. the differences due to the physical location of customers groups. Around 68 percent of international firms have office in Hong Kong. According to Keegan. Belgium. and Dahringer (2006) suggest rather than focusing on country markets. 2000). Hong Kong. India. So this case study analyses and discusses the internationalization process of how the Alvin Connor Ltd can successfully establish its products in Asian market.7% of the Earth's total surface area (or 30% of its land area) and with approximately 3. Introduction: At its simplest that is. after Europe. located primarily in the eastern and northern hemispheres.economist.

Then the case study will discuss about the competitor of the selected country. external analysis of both the country. which produces a range of natural. They have chosen to become a Green Ambassador as they feel it’s important to show people that companies like them exist in Liverpool. their products are accredited by the Vegan society. They are also the only company to produce and manufacture crystal deodorants in the UK. Company’s Information: Alvin Connor which is based in the Liverpool and has positioned itself as one of the country’s leading eco-friendly body care product manufacturers established in October 2002.ourcityourplanet. They produce sustainable products that last far longer than chemical alternatives (crystal stick deodorant lasts for over 6 months). then case study will describe the ethical profiles of the two companies (Alvin Connor Ltd and its competitor) and finally the conclusion. They have worked extensively to promote the green agenda and demonstrate that natural alternatives in skincare are much better for our health and our environment. They believe that having good environmental and ethical policies in place is something that many companies can achieve with a little effort (www. which country market is potential. The Company mainly produces and markets a complete range of natural body care products. emphasizing their similarities regardless of geographic areas in which they are located. *Natural Body Stick In the case study I have chosen two Asian countries which is India and China the case study will discuss between the two countries. what are the strategy used by competitor when he introduced his product. 4 . which foreign market is perfect to introduce Alvin Connor’s They are an ethical company. paraben free and aluminium free products. Alvin Cooney is the founder of Alvin Connor Ltd and the companies Managing Director. chemical free. the Vegetarian Society and the BUAV (British Union for the Abolition of Vivisection). Alvin Connor is a skincare company. position of product in each country. *Natural Body Spray Deodorant.

China." This broad definition includes. with focus on Japan. India.S. Cosmetic Industry: Cosmetics are substances used to enhance the appearance or odor of the human body. deodorants.*Natural Foot Powder. promoting attractiveness. but the distribution and sale of cosmetics is spread among a wide range of different businesses. Cosmetics include skin-care creams. perfumes." which refers primarily to colored products intended to alter the user’s appearance. as well as receiving a host of other great reviews from fashion and beauty industry magazines (www. *Natural Lavender Scented bath soak. The report also profiles the top cosmetic companies. beautifying. It analyzes the market butters and many other types of products. baby products. hair colors. Cosmetic Market In Asia: This report analyzes the cosmetics market in Asia. or altering the appearance without affecting the body's structure or functions. towelettes. Alvin Connor Natural Body Stick Deodorant was voted 10 out of 10 by the Sunday Times Style Magazine. Food and Drug Administration (FDA) which regulates cosmetics in the United States defines cosmetics as: "intended to be applied to the human body for cleansing.The Japanese cosmetics market is in a stable condition but with continuous 5 . hair sprays and gels. as well. competitive landscape and market trends in each of the major regions. hand sanitizer. A subset of cosmetics is called "make-up. and Korea. any material intended for use as a component of a cosmetic product. eye and facial makeup. The manufacture of cosmetics is currently dominated by a small number of multinational corporations that originated in the early 20th century. The FDA specifically excludes soap from this category (www. *Natural Unscented Bath soak and Unscented Body Polish. bath salts. fingernail and toe nail polish. permanent waves.womenshealth. The U.alvinconnor. lipsticks. powders. *Natural Rose Scented Bath soak. colored contact lenses. lotions. bath oils. bubble baths. Japan . with a discussion of their key business strategies.

realignment of distribution channels. Hindustan Unilever is India's largest cosmetics company. the level of development of the market is still very low. In Vietnam and Indonesia. Another notable trend is the rising demand of the male consumer segment. all cosmetics producers need to enhance and restructure the management of their sales channels. In India. Skin care and color cosmetics have witnessed solid growth for the last few years.Skin care products dominate the Taiwanese market. This suggests a huge growth potential for foreign cosmetic producers.China's cosmetics market. The modern. In Thailand.India is being targeted by global cosmetic giants due to its favorable demographics. with more than half of the skincare market comprising of skin lightening creams. India . have transformed traditional stores into their self-owned retail channels. South Korea . Kose. Specialty stores are the leading channel due to consumer convenience and low prices while sales through department stores is slowing down. is witnessing increased demand due to improving lifestyles and rising disposable income of the Chinese population. L'Oreal has the largest market share in China. and Pola dominate the cosmetics market in Japan. urban Indian women are becoming increasingly conscious about their style and looks. foreign companies dominate the market. There is a clear trend of the market heading towards premium cosmetic products. followed by L'Oreal. In Singapore. Although several domestic firms are present. followed by color cosmetics and hair care products. Kao (and Kanebo). China . small pack sizes are very popular as they offer a lower cost and the chance to try new products. Shiseido. Taiwan . the second largest in Asia Pacific after Japan. Lip products form a majority of the color cosmetics market. However. skin care products and perfumes lead the market. Amorepacific and LG H&H.South Korean cosmetics market is growing at a faster rate than developed regions. The younger populace is looking for general skin care and hair care products while the older generation has more specific needs for their cosmetics products. domestic cosmetic producers cater to the middle 6 . the leaders in the Korean cosmetics market. with great emphasis on lightening of skin tone. sun care products and men's grooming product has been the growth engine.

the Indian economy is nominally worth US$1. as of 2011. it is the tenth-largest economy 7 .2 billion people. It is the seventh-largest country by geographical area. economic environment.843 trillion. stability of currency and political stability. (www. here we discuss about the countries population size. the second-most populous country with over 1. import volume of goods and service is good compared to other three countries. China.and low-end market segment while imported cosmetics dominate the upper strata of the market ( Korea and Taiwan may be its better to compare India and Chain as both the country has market gap for Alvin Connor products even the population size. sustainability of currency. Comparing Two Countries: This section analyzes the comparison of both the countries China and India.reportbuyer. India. economic After the report analyzes of Japan. and the most populous democracy in the world. According to the International Monetary Fund. political stability. India: India is a country in South Asia.

at US$4. brand positioning.469 trillion. According to a 2011 PricewaterhouseCoopers report. the total Indian beauty and cosmetic market size currently stands at US$950 million and showing growth between 15–20% per annum.pdf) Cosmetics Market In India: This section analyzes the cosmetic market in India like costumer segments.8% over the past two decades. product The report highlights key growth factors: a young and rapidly growing working-age population. India's GDP at purchasing power parity could overtake that of the United States by market exchange rates. During the next four decades.imf. Indian GDP is expected to grow at an annualized average of 8%. and sustained growth of the consumer market driven by a rapidly growing middle class (www. making it potentially the world's fastestgrowing major economy until 2050. the third largest by purchasing power parity with its average annual GDP growth rate of during 2010 (www. The Indian cosmetics and toiletries market has seen major changes both in terms of user perception and product availability over the past five years. and growth The overall beauty and wellness market that includes beauty services stands 8 . According to figures given by the Confederation of Indian Industries (CII). growth in the manufacturing sector due to rising education and engineering skill levels. India's GDP against US GDP at Market Exchange Rates (MERs) (Source: http://www. and reaching 10. and is.

Nasreen and Ravichandran. In fact CII organized its first beauty B2B event Beauwell India 2005 in Chennai in March. which slowly is evolving in the Indian market (Priyanka. Brand Positioning: Branding is about establishing relationship with “consumers” on the basis of personality or human-like characteristics and emotional values (Bernard. 2008). it has become very important for the cosmetic and skin care companies here to develop the right brand positioning and create the right product and brand awareness. Customer Segments: According to a CII The middle market price can range from Rs 200 up to Rs 800. As older women have more cash and are more conscious of their appearance. according to CII estimates. with the result that a woman from such social strata now is more conscious of her appearance and is willing to spend extra cash on enhancing it further (www. 2012). 2008). which might be lower than some other countries. The other not so obvious one is the corporate dressing culture.hindu. especially skin. With increasing awareness among customers. which attracted foreign participation especially from Europe (www. First obviously is the television and media exposure they have today. women in the age group of 30 and above are getting very selective about the type of products they choose. pricing can range 9 . but this indicates a growing awareness among consumers. they are willing to spend more on separate sets of creams and lotions that target problem areas. US$0. These women also are more open to buying higher-priced products (Abdullah.gcimagazine. Pricing of the product and the nature of product usage are the two criteria that define brand positioning. The steady growth rate in the Indian cosmetic and beauty service market has made the Indian government see it as a source of potential revenue for the country.680 million. There are two major factors that are swaying the buying decision among women According to a source at L’Oreal India. In the high-end market. The increasing market size is the direct result of the changing socio-economic status of the Indian consumers.68 per capita is spent for cosmetics. Higher paying jobs and increasing awareness of the Western world and beauty trends there have served to change the tastes and customs of the middle class and higher strata of the society. For instance products falling under the price range of Rs 45 to Rs 200 are in the mass-market category. especially about US$2.

while presenting a market potential. Finally there is the premium range of products where the pricing can touch up to Rs 35. 2008). Growth Opportunity: According to industry watchers. Despite the new value added taxation regime. it came to light that some major European cosmetic vendors were looking for distributors and third-party manufacturers to set up joint ventures in the country. This in turn reflects in the pricing of the products. need more customer education before they can grow (Priyanka. other specialized products such as anticellulite lotions or nail creams and nail care products. there is no organized cosmetic industry body that can take up the issue with the government. India is being seen as a strong manufacturing hub and a good source for natural ingredients (Priyanka. the most popular are anti-wrinkle. where pricing can vary from 30-70% from Indian product pricing (Priyanka. 10 . 2008). there are hurdles that impede growth. In Beauwell India 2005 event. where the duty has been reduced to 12. However. In fact this leads to the biggest threat the unorganized or grey channel. There are small retailers in the market who directly import from markets such as Dubai. In fact after China. 2008). Most vendors add the duty to the product pricing to generate the right revenue. The Indian duty structure on imported products can pose a major deterrent to multinational vendors. In skin care. the overall duty on the product still comes to about 40%. the Indian market is ready and is just waiting for the right spur. anti-blemish and skin-whitening products followed by sun care and bathing products. In fact some even expect the market to show 25% growth as they anticipate a boost in the retail segment.000 (Priyanka. However. The big opportunity where India is being perceived to have a good scope is manufacturing.5%. Challenges: While the market seems impressive. Today these product segments are showing impressive growth rates. while presenting a market potential.from Rs 800 to about Rs 5000. Product Preference: India presents a big opportunity for global cosmetic vendors selling color cosmetics and specialized skin care products in the market. 2008).

listofcountriesoftheworld.9 trillion (US$1. the People's Republic of China was a Soviet-style centrally planned economy. It shares 90% as nation while sales value is above 60%. and Cuba).chinadaily. 11 . North Korea.000) has reached more than 100 million as of 2011 while the number of super-rich individuals worth more than 10 million Yuan (US$1. China's middle-class population (defined as those with annual income of at least US$17.7 million square miles) in total area and is the world's second-largest country by land area and the fourth largest in total area. although it is only ranked 135th among the 179 countries measured in the Index of Economic Freedom. According to insiders. reproductive rights. The PRC government has been variously described as communist and socialist. freedom of China's retail market was worth RMB 8. with 27. and is growing at 16. skin-care products is topping the list sharing 35%.000. others being perfumes.5 million) is estimated to be 825. Laos. The preponderant manufacturers in China are located along the Eastern Costal line and inland The East Asian state covers approximately 9. but also as authoritarian. China now ranks 29th in the Global Competitiveness Index. with heavy restrictions remaining in many areas. and freedom of religion (www. hair-care products sharing 28%. China is also now the world's second-largest consumer of luxury goods behind Japan. although this had decidedly mixed economic results (www. Mao Zedong instituted the Great Leap Forward in the early along with Vietnam. Among 300 brands.China: China is the world's most-populous country with a population of over 1. 20 of them have taken the leading position and joint venture took 80% of market share.historylearningsite. depending on the definition of total area (www. total sales will reach to RMB 80 billion and level up at 12. without private businesses or capitalism. From its founding in 1949 until late 1978. industrialized communist society.302 trillion) in 2007. In respect of types. the To propel the country towards a modern.6 million square kilometers (3.5% of the global share (www.8% annually. Cosmetics Market In China: Cosmetic industry has been evolving into full-fledged market in which flourishing brands emerged. make-up products sharing 29%. The People's Republic of China. is one of the five remaining Communist states in the world (Randall 2007).9% annually.3 most notably on the Internet.

12 . Last decade has proved highly beneficial for the market as it underwent rapid transformation and expansion phase. 2011). the country still possesses immense growth potential. consumer behavior are better than china. Although the market has been registering impressive growth rates. After the report analysis of two countries may be its better to choose Alvin Connor to enter Indian market as compare to China the Indian cosmetic market has a more gap even the government stability. Even the Indians are very much fascinated towards foreign brands rather than Chinese. Owing to the extremely low penetration level and vast consumer base. growth opportunity. the State Food & Drugs Administration (SFDA) has tightened control on various fronts to better guard the interest of consumers (RNCOS. Chinese cosmetics and toiletries market is the second largest in the Asia-Pacific region after Japan and third largest in the world. As Alvin Connor is an eco-friendly body care product manufacturers Indians are very much attractive towards eco-friendly products because of this may be it will be easier for Alvin Connor to create their own market. cosmetics and toiletries market in China is expected to grow at a CAGR of over 12% during 2011-2014 the market is currently lead by international such as P&G and L’Oreal.htm) China represents one of the most dynamic and untapped cosmetics and toiletries markets in the world. During the last few years.(Source: http://www.acunion.

detergents. Lifebuoy.000 13 . France. Clinic Plus. Fair & Lovely. Hong Kong. the UK and the U. Lakme. skin care. Hindustan Unilever Limited: Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods Company with a heritage of over 75 years in India and touches the lives of two out of three Indians. With over 35 brands spanning 20 distinct categories such as soaps. Sunsilk.Competitor and Market Entry Strategy: In this section will compare and contrast the Indian market entry strategy and will discuss about the competitor and their entry strategy then will critically evaluate analysis in light of appropriate international marketing theory or research and will discuss ethical principles of both the companies. packaged foods. Knorr. Kissan. Germany. look good and get more out of life with brands and services that are good for them and good for others. Kwality Wall’s and Pureit. the Company is a part of the everyday life of millions of consumers across India. and greater product choice and availability are the main drivers of demand for imported cosmetic products. India allows entry of imported cosmetics without any restrictions. The emergence of a young urban elite population with increasing disposable income in cities. which was traditionally a stronghold of a few major players like Lakme and Pond’s. Brooke Bond. Hindustan Unilever is India's largest cosmetics company.S. followed by L'Oreal (www. toothpastes. Surf Excel. Its portfolio includes leading household brands such as Lux. mounting aspirations. Bru. Indian consumers tend to look towards international brands as lifestyle enhancement products (Lovejeet. Thailand. HUL works to create a better future every day and helps people feel good. have been the traditional suppliers with imports gradually increasing from China. an increase in the number of working women. and Israel in recent years. Dove. tea. increased affordability of lifestyle-oriented and luxury products. Vaseline. Axe. ice cream.researchandmarkets. Closeup. has seen a lot of foreign entrants to the market within the last two decades. increasing appetite for Western goods. coffee. Imported cosmetics have had a major impact on the Indian market. Malaysia. changing lifestyles. Pepsodent. cosmetics. Rin. The Company has over 16. shampoos. The Indian cosmetics market. Wheel. Pond’s. influx of satellite TV. and water purifiers. 2011).

employees and has an annual turnover of around Rs.hul. They will inspire people to take small everyday actions that can add up to a big difference for the world. followed by Lever Brothers India Limited (1933) and United Traders Limited (1935).2011). began an era of marketing branded Fast Moving Consumer Goods (FMCG).675 individual shareholders and financial institutions (www. HUL Market Entry Strategy: In the summer of 1888. one of the world’s leading suppliers of fast moving consumer goods with strong local roots in more than 100 countries across the globe with annual sales of about €44 billion in 2011. They help people feel good. being the first among the foreign subsidiaries to do so. As their business grows. Unilever has about 52% shareholding in HUL (www. visitors to the Kolkata harbor noticed crates full of Sunlight soap bars. so do their responsibilities (www. With it. embossed with the words "Made in England by Lever Brothers" look good and get more out of life with brands and services that are good for them and good for others. The rest of the shareholding is distributed among about 360. Vision of HUL: The four pillars of our vision set out the long-term direction for the company – where we want to go and how we are going to get there: • • • • They work to create a better future every day. HUL offered 10% of its equity to the Indian public. Unilever set up its first Indian These three companies merged to form HUL in November 1956.19. HUL Sustainability Strategy: 14 . Unilever now holds In 1931.10% equity in the company. HUL always believed in the power of their brands to improve the quality of people’s lives and in doing the right thing. They will develop new ways of doing business with the aim of doubling the size of their company while reducing the environmental 401 crores (financial year 2010 . Hindustan Vanaspati Manufacturing Company. HUL is a subsidiary of

hence addressing sustainability issues is a high priority. the environment and the society that they operate in.hul. HUL have a very strong and trusted position in India and they can leverage this to their competitive advantage.In Hindustan Unilever Limited (HUL). The three cornerstones for CR integration with business at HUL will be: • Growing markets responsibly: HUL will address issues related to hygiene and nutrition through product innovations and awareness. customers. communities. and stakeholders can help them to identify opportunities for innovation at the category. (Source: http://www. the principle of Corporate Responsibility (CR) is an integral part of their commitment to all their stakeholders – consumers. HUL need to establish sustainable sources for raw materials. • Ensuring sustainable practices in their operations: To secure a thriving future.aspx) By this report we come to know that HUL applied joint venture strategy to enter Indian Gathering information about the concerns expressed by consumers. and marketing plan level. agriculture could be under pressure. • Building a good reputation through responsible leadership: CR is one of the key components of reputation and trust. HUL must plan now for a future in which water could be scarce. So it’s clear that if the Alvin Connor Ltd wants to enter Indian market may be its better to establish their business through joint venture. lt. 15 . Being a company that is heavily dependent on water. and fuels will be expensive. A good reputation can be a major competitive advantage and can build employer brand and consumer loyalty. brand. fuels and petrochemicals. employees. Their consumers add up to twothirds of the Indian population.

Turkey and Cyprus.e. The company has ambitions to ultimately take the Alvin Connor brand across the world. France. Section three is all about cosmetic industry and also a report on Asian cosmetics market then the report analyzes the Asian market by comparing two Asian countries India and China. competitors vision.Conclusion: Strategic management is an ongoing process that assesses the business and the industries in which the company is involved. In section two is all about company information. market entry strategy. or a new social. where we come to no that company has entered international market through direct export strategy. financial. sustainability strategy. 1984). new competitors. a new economic environment. the Netherlands. growth opportunity. Reference: 16 . assesses its competitors and sets goals and strategies to meet all existing and potential competitors. Luxembourg. From the comparison we come to know that India has a better market for Alvin Connor to establish their business as the India’s cosmetic market has a more gap even the government stability. Belgium. or political environment (Robert. and then reassesses each strategy annually or quarterly [i. In the section one it’s all about introduction of Alvin Connor Ltd as the company becoming universally available through independent whole food shops. their products and awards from the section two analyses we come to know that the Alvin Connor is an ethical company. consumer behavior are better than china. the major competitor. new technology. The overall case study analyses and discuss the internationalization process of the “Alvin Connor Ltd” a leading eco-friendly body care product manufacturers. Italy. They are becoming increasingly popular overseas with regular exports to European countries including Sweden. the strategy used by the competitor to establish their market in India for example company background. Then the report is researched on the Indian cosmetic market. From the whole research process it is clear that may be through joint venture it will be easy for Alvin Connor to enter Indian market. regularly] to determine how it has been implemented and whether it has succeeded or needs replacement by a new strategy to meet changed circumstances.

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