table of contents - econunivpm · table of contents company description ... swot analysis ... all...

Version 1.0

10/16/07 Clinique Confidential

Table of Contents Company Description and Location…………………………………….….. 2 – 4 Strategic Plan and Focus………………………………………………………. 5 – 8 Mission Statement……………………………………………………..……… Product Mission Statement…………………………………………...…..….. Corporate Goals…………………………………………………..………...… Corporate Values…………………………………...…………………...…..... Core Competency and Sustainable Competitive Advantage……………..

5 5

5 – 6 6 – 7 7 – 8

Situation Analysis…………………………………………………..…………… 9 – 14 SWOT Analysis……………………………………………………………...… Industry Analysis………………………………………………………….…... Competitor Analysis……………………………………………………...….... Company Analysis…………………………………………………………..… Customer Analysis…………………………………………………...……..…

9 – 10 10 – 12 12 – 13 13 – 14

14

Marketing Product Focus………………………………………………….…... 15 – 19 Marketing and Product Objectives………………………………………..…. Target Markets……………………………………………………………….... Product Positioning….…………………………………………………….….. Product Differentiation...………………………………………………….…...

15 – 17 17 18

18 – 19

Marketing Program………………………………………………………..…….. 20 – 22 Product Strategy.….……….……………………………………………..…… Price Strategy……………………………………………………………..…… Place Strategy…….……………………………………………………….…... Promotion Strategy……………………………………………………….……

20 20 21

21 – 22

Financial Data and Projections………………………………………………. 23 Implementation Plan…………………………………………………………… 24 Evaluation and Control………………………………………………………... 25 Resources…………………….…………………………………………………. 26

Version 1.0


Company Description and Location Clinique Laboratories, Inc. (Clinique) is one of the world’s leading manufacturers of prestige skin care, makeup and fragrance products for women and men, first introduced by the Estée Lauder Companies, Inc. in 1968. Clinique products are created with the assistance of dermatologists and extensive research, insuring that they are allergy tested, 100 percent fragrance free and designed to address individual skin types and needs. The company’s signature 3-step system of cleansing, exfoliating and moisturizing is the basis of all Clinique’s skin care products. In 1996 Clinique became the first brand in the cosmetics industry to launch a company website, and in 1998 it became the first prestige brand to offer an e-commerce site. Clinique is sold in more than 9,000 doors in more than 80 countries and territories. Successful Clinique product launches include: Stop Signs Visible Anti-Aging Serum, Acne Solutions, Superfit Makeup, Super City Block SPF 25 and Body Clinique. Dramatically Different Moisturizing Lotion, launched as part of the original system in 1968, remains the number one selling moisturizer in the world, selling one bottle every four seconds. Another successful Clinique product is the Clinique Happy fragrance line. Clinique Happy for women was launched in 1997 and is now the number one prestige fragrance in the country. Following its success, Clinique Happy for men was introduced in 1999 with rapidly escalating sales. Being an innovative leader in the cosmetics industry, Clinique launches several new products each year, including the 2001 projected number one seller Clinique Anti-Gravity Firming Eye Lift Cream. One of Clinique’s focuses is to maintain long-term, loyal relationships with its customers. Clinique was the first member within the cosmetic industry to devote significant times and resources to consultant training. Also, Clinique was the first brand to support the need for everyday sun protection.

Clinique’s parent company, Estée Lauder Companies, Inc., was founded in 1948 by Estée and Joseph Lauder. The Lauder’s chose New York City for its corporate headquarters and it remains there today. Over the years, Estée Lauder has built a family of brands with a unique balance, owning numerous brands that appeal to different consumer groups. The company’s products are sold in over 120 countries and its portfolio of brand names include Estée Lauder, Aramis, Clinique, Prescriptives, Origins Natural Resources, M•A•C, La Mer, Bobbi Brown essentials, Tommy Hilfiger Toiletries, jane, Donna Karen Cosmetics, Aveda, Stila, Jo Malone, and Bumble and bumble. Currently, Estée Lauder employs approximately 17,000 full-time employees worldwide.

Version 1.0


The company has been at the forefront of technology by investing millions of dollars in Research and Development each year. In general, approximately one third of Estée Lauder’s sales volume in a year comes from products developed internally within the previous three years. Approximately 300 skilled chemists, biologists, microbiologists and physicist are currently on staff. These research facilities are located in New York, Minnesota, Ontario, Belgium, and Japan. Financially Estée Launder Companies Inc. has had much success. For fiscal year 2000, net sales were $4.4 billion and net earnings were $341.1 million. The company has recorded more than 45 years or consecutive annual sales increases. The Class A Common Stock of the company is listed on the New York Stock Exchange under the symbol EL.

Estée Lauder Company Inc. Corporate Timeline

1946 Joseph and Estée Lauder found Estée Lauder in New York City.

1948 The first department store account is

established with Saks Fifth Avenue.

1960 International operations begin, launching products in the United Kingdom.

1964 Aramis, a line of prestige fragrance and grooming products, is launched.

1967 Mrs. Estée Lauder is named one of ten Outstanding Women in Business in the United States.

1968 Clinique Laboratories, Inc. is founded.

1979 Prescriptives is founded.

1985 Mrs. Estée Lauder 's autobiography, ESTÉE: A SUCCESS STORY, is published.

Version 1.0


1990

Origins is founded.

1993 Aramis Inc. signs a licensing agreement with

Tommy Hilfiger. This marks the company's first licensing venture.

1994 Estée Lauder Companies Inc. acquires a majority interest in M•A•C Cosmetics.

1995 The Estée Lauder Companies Inc. acquires Crème de la Mer and Bobbi Brown essentials.

1996 Clinique launches Website on the Internet, www.clinique.com.

1997 Clinique launches a new fragrance, Clinique Happy. Estée Lauder Companies Inc. acquires 100% of Sassaby, Inc., owner of the color cosmetics brand jane, as well as Donna Karen and Aveda beauty products.

1998 Clinique launches interactive e-commerce

site at www.clinique.com, becoming the first prestige cosmetic brand to sell its entire line of cosmetics over the Internet.

1999 The Estée Lauder Companies Inc. acquires Stila Cosmetics, Inc. and Jo Malone Limited.

2000 Estée Lauder Companies Inc., Chanel and

Clarins announce the development of a relaunched www.gloss.com with brands of all three companies to be represented on the site in 2001. Acquires Bumble and bumble.

Version 1.0


Strategic Plan and Focus The following five sections describe in detail the corporate strategy used in designing this marketing plan: (1) the corporate mission statement, (2) the product mission statement, (3) the corporate goals, (4) the corporate values, and (5) the core competencies and competitive advantages. Corporate Mission Statement Our mission at Clinique is to be the world’s leading manufacturer and marketer of prestige skin care, makeup and fragrance products. Clinique strives to always meet individual skin care needs through innovative products that are allergy tested, 100 percent fragrance free, and designed under the guidance of dermatologists and research. Clinique products are never tested on animals. Product Mission Statement Clinique’s Anti-Gravity Firming Eye Lift Cream produces firmer, less lined, brighter skin all around the eyes. Its patent pending formula renews the skin’s elasticity by boosting natural collagen, building a supple cushion back into time-thinned skin and reducing the signs of aging.

Corporate Goals For the subsequent three years, Clinique will recognize the following goals: Non-Financial Goals

Continue to develop innovative products in accordance with our mission statement, adding three new products each year.

Version 1.0


Establish a presence in Latin American countries.

Launch www.gloss.com website with Chanel and Clarins by December 2001.

Develop e-commerce websites for Aramis, Prescriptives, La Mer, Tommy Hilfiger

Toiletries, and Stila brands.

Explore entering a new product line, possibly in nail care or deodorant, that would further enhance Clinique’s position as a prestige cosmetic company.

Financial Goals

Increase sales by at least 15% per year for the next three consecutive years.

Increase revenue growth by at least 15% per year for the next 3 years.

Increase Return on Investment by 20% per year for the next 3 years.

Budget $10 million for Research and Development of new products and product lines each year for the next three years.

Corporate Values

“

At Clinique, we develop and create high-quality prestige products with individual consumer needs in mind. All our products are 100% fragrance free and allergy tested, as we understand the importance to maintaining healthy skin and everlasting beauty. We believe that understanding and aiding consumers is fundamental in maintaining positive relationships and thus sales growth. We also believe in the need to help people who are less fortunate then ourselves and have incorporated this belief into our corporate values. Clinique Laboratories, Inc. is dedicated to the idea of “Bringing the Best to Everyone We Touch.” We have joined forces with our parent company, Estée Lauder Companies Inc., to initiate a philanthropy program that supports the growth of numerous organizations dedicated to health and human services, education, the environment and the arts. We strive to be responsible business people and citizens in every community that we serve. Our corporate fund drives help sustain local public school and charities. We work to preserve the environment through recycling programs and we strongly endorse employee volunteerism.

Version 1.0


Some of our community involvement projects include:

The Estée Lauder Companies’ Breast Cancer Awareness Program – introduced in October 1992 this program aims at drawing public attention to breast cancer and helps spread the message that early detection saves lives.

First Step Job Readiness Program – an intensive, sixteen-week job readiness

program that helps homeless and low-income woman gain the skills and confidence needed to obtain economic independence.

Dear Santa Holiday Program – each year, Clinique volunteers “adopt” many

hundreds of children’s letters written to Santa and fulfill their wishes.

Partnerships with School, including:

The Murry Bergtraum High School for Business Careers.

P.S. 20, a New York City public elementary school.

Roberto Clemente High School – Clinique supports this school through donations of computer equipment and office supplies.

P.S. 811X, a Bronx school that offers a unique environment for disabled

students. Core Competencies and Competitive Advantage Clinique Laboratories, Inc. has established a reputation as one of the world’s leading manufacturers and marketers of prestige skin care, makeup and fragrance products. As we realize no two people have the same beauty needs, we provide high quality products that are tailored to meet individual preferences. We receive moderate to premium prices for our products, as trained scientists and dermatologists extensively researched to produce them. We have incorporated a “product differentiation” strategy, in order to distinguish ourselves from competitors who do not spend as much of their revenue on developing products that are the safest for consumers and that meet their individual needs. Clinique’s Anti-Gravity Firming Eye Lift Cream will benefit from these highly developed core competencies. We can position this product as a premium product and market accordingly, as this product holds true to the idea of creating products for individual customer needs and is free of harmful chemicals. Clinique has achieved a sustainable competitive advantage in the cosmetic industry by creating an expectation in the minds of consumers that products are free of fragrances and chemicals causing allergies are of superior quality to the less-researched option

Version 1.0


from our competitors. Our limited distribution channels complement the premium image associated with our brand. These upscale department stores and specialty retailers offer a limited amount of space on their floor to what they deem to be respected cosmetic manufacturers. After distributing in these stores for over 30 years, it would be difficult for our competitors to take over our position. An important advantage of the Anti-Gravity Firming Eye Lift Cream is that it has a unique, innovative formula, with U.S and International Patents pending. We will use a penetration pricing strategy, as the products by our competitors are currently overpriced and of lesser quality. By doing this, we believe we will be able to gain a considerable amount of market share.

Version 1.0


Situation Analysis SWOT Analysis Figure 1 below shows both the external and internal factors that influence the market opportunities for Clinique. The SWOT analysis will summarize the strengths, weaknesses, opportunities and threats that Clinique is currently facing. Figure 1. SWOT chart Internal Factors Strengths Weaknesses Management

Over 30 years experience overseeing the design and initiation of new products and product lines.

All members of Clinique’s Board of Directors are from its parent company, Estée Lauder Companies, Inc.

Offerings

High-quality, tailored products that are free of harsh chemicals. Our products are never tested on animals.

Competitor products are offered to public at a higher price, making Clinique’s products appear to be of lesser quality.

Marketing

Aggressive, well-funded marketing programs aimed at building brand equity.

Products are rarely discounted.

Personnel

Believe strongly in the quality of our products and in our corporate philanthropy initiatives.

Employees at the customer sales level are often inexperienced.

Finance

Financial support from Estée Lauder Companies, Inc., who have recorded more than 45 years of consecutive sales increases.

Large portion of funds spent on Research and Development of new products and product lines.

Manufacturing

Numerous manufacturing facilities in the United States, Belgium, Switzerland, the United Kingdom, Canada and Australia.

Suppliers of chemicals are often late with shipments.

Research & Development

More than 300 chemists, biologists, and microbiologists, currently on staff.

Extremely costly to develop products free of fragrance and allergy inducing chemicals.

Version 1.0


Figure 1 continued External Factors Opportunities Threats Consumer/Social

Product is marketed toward upper-middle class market as a prestige product that is extensively researched, better for your skin, and personalized to individual preferences.

Customers feel they are paying too much for a product that they feel they can find a cheaper alternative for at a discount store.

Competitive

Anti-Gravity Firming Eye Lift Cream has a unique, new formula, with US and International patents pending.

Competitors are rapidly developing similar products with additional features and benefits.

Technological

Customers can buy products online at www.clinique.com and can be delivered anywhere in the United States.

High website start up and maintenance costs.

Economic

Currently the United States has just gone through a period of rapid economic growth, and thus consumers are wealthier.

Economy is expected to level off, making consumers more conscious of their purchase decisions and less willing to purchase premium products.

Legal/Regulatory

Clinique products are extensively tested to ensure that they meet all safety and regulatory guidelines.

Clinique’s products are not tested on animals and therefore use more expensive methods to ensure they meet safety standards.

Industry Analysis The cosmetic industry is a $26 billion per year industry at the sales level in the United States alone. Because of the opportunity for extensive sales and revenues, there are numerous manufacturers throughout the world. As a result, no single supplier holds a market share greater than 17%. Estée Lauder Companies, Inc. holds an 8% market share. Other leading manufacturers include: Unilever, Proctor and Gamble, Cosmair. Colgate, Revlon, and Bristol-Myers Squibb. There are such a large number of manufacturing firms tapping into this market that potential entrants would have tremendous difficulty raising the revenues necessary to enter the market or to continue

Version 1.0


in Research and Development to gain any portion of the incredibly competitive market share. Key societal trends that will impact cosmetic products sales throughout the world include:

An increase in the number of middle aged customers, as the Baby Boomer generation has grown up.

A paradigm shift to an industry that is focused on “relationship marketing.”

Increased concern for consumer safety.

Popularity of buying from firms who are socially conscious.

Clinique’s Anti-Gravity Firming Eye Lift Cream will benefit from these trends. This product will be targeted at middle-aged consumers worried about the signs of aging and thus, as trends indicate, has an extremely large potential target market. Clinique is also a leader in relationship marketing, as they were the first in the cosmetics industry to devote significant time and resources to consultant training, and were the first to introduce “one-on-one” consultations to consumers. We use natural chemicals that are free of any harmful toxins and our products are never tested on animals. Finally, Clinique’s corporate values are well known. Clinique also needs to analyze the outside forces affecting the cosmetics industry by using Michael Porter’s Five Forces Model. Porter suggests that each industry analysis should include the following: (1) potential entrants, (2) suppliers, (3) buyers, (4) substitutes, and (5) industry competitors. Potential Entrants As mentioned earlier, entrance into the cosmetics industry is extremely difficult. This is due to high start up costs in Research and Development and limited accessibility to market share. Clinique has strong brand recognition and a very loyal customer following. With the support of one of the country’s founding cosmetics corporations, Estée Lauder Companies, Inc., we do not perceive that any possible new entrants would be of significant concern at this time, however, we will continue to regulate this. Suppliers Maintaining a positive relationship with our suppliers is crucial to Clinique’s success. Our products are created using specific chemicals that are proven to not be of harm to the skin. There are a limited number of suppliers for these chemicals, giving them significant bargaining power. The power of the suppliers, however, does not exceed the power of Clinique and its parent company, Estée Lauder Companies, Inc. Estée

Version 1.0


Lauder Companies, Inc. has a large amount of financial backing and could feasibly develop their own supply company if need be. Buyers Clinique products are sold largely in upscale department stores and specialty retailers and retain a prestige image and premium pricing. Buyers have a limit on the places they can buy these products and substitutes are often of poor quality. Also, brand preference for the Clinique name is very strong. As a result, buyer power of our products is very limited. If one of the major stores in our distribution channel decided to pull our products from their stores and replace them with another brand in which they have more influence, buyer power would increase. Substitutes Our target market demands products that are of premium quality and not harmful to their skin. Clinique is a brand name that has a strong consumer preference backing it. There are no equivalent substitutes for our products that provide the same remarkable results. Our products are patented and confidentially developed in our labs. Because of these facts, it is reasonable to assume that the threat of substitutes is unsubstantial. Industry Competitors Our major competitor in the cosmetics industry is Lancôme, a cosmetic retailer of makeup, skin care, and fragrance products based in Paris, France. Our major advantage over Lancôme is that we have a greater distribution of our products worldwide. Also, Clinique has the backing of its parent company, Estée Lauder Companies, Inc., a very strong and influential member of the industry. Lancôme, on the other hand, is its own corporation and has more limited financial resources. Lancôme does, however, have one major advantage over Clinique: it charges a slightly higher price for its products, making Clinique’s brand appear to be of a lesser quality. Competitor Analysis Our industry analysis described the cosmetics industry’s major manufacturers. This industry is very competitive, as there are currently several well-established firms in the market. Because there is such a large market, products have been segmented into smaller, specialized groups, such as makeup, skincare, sun and body care, and fragrances. Many members of this industry produce products for both men and women, further segmenting their product lines. There are also three main types of cosmetic lines: professional products, used in the entertainment business or for reconstruction purposes, salon products, manufactured by different salons, such as Aveda or Paul Mitchell, and finally retail products, including both premium products, such as Clinique, or products sold in discount stores, such as Revlon.

Version 1.0


Our leading competitor, as mentioned in the five forces analysis, is Lancôme. The products they market are also considered high quality and have strong brand recognition. Lancôme distributes their products in the same retailers and upscale department stores as Clinique. Lancôme currently has a product that is similar to Clinique’s Anti-Gravity Eye Lift Cream, however, this product is relatively outdated, highly priced, and does not produce the same remarkable results that Clinique’s Anti-Gravity Firming Eye Lift Cream produces. In this marketing plan we will also consider our other sources of competition in the premium product cosmetic industry: Aveda and Shiseido. Please note: Aveda is one of Clinique’s main competitors, however, it is also owned by Estée Lauder Companies, Inc. The following is a list of our product and our competitors leading products: Clinique’s Anti-Gravity Firming Eye Lift Cream $28.50 Lancôme’s RÉNERGIE EYE Anti-Wrinkle And Firming Eye Cream $45.00 Shiseido’s Eye Revitalizer $49.00 Aveda’s Pure Vital Moisture Eye Cream $32.00

At Clinique we are striving to be competitive in our pricing of our Anti-Gravity Firming Eye Lift Cream, while at the same time offering a prestige product that is of extreme quality and true to our mission. By offering our product at a lower price, we will be able to penetrate the market quickly. Company Analysis Clinique has existed in United States for more than 30 years as a leader in quality, prestige cosmetic products. Over the years, Clinique has expanded and is now a competitor in the global market. Currently, Clinique is sold in over 83 countries and territories. Clinique is a member of Estée Lauder Companies, Inc., one of the world’s leading manufacturers and marketers of quality skincare, makeup, fragrance and hair care products. Clinique has been a very profitable branch for Estée Lauder and will

Suggested Retail Price

0

20

40

60

Clinique Lancome Shiseido Aveda

Company

Pric

e (In

Dol

lars

)

Version 1.0


continue to be so in the future through the strength of existing brands and the development of new products. At Clinique we focus on quality products that are fragrance free and do not consist of chemicals that would stimulate allergies. We have created many different versions of our product lines to suit individual customer needs. We have over 300 chemists, biologists, and microbiologists on staff to help create our patent-protected products. At Clinique we have a strong corporate philosophy to help our communities. We donate resources to several organizations, such as schools with underprivileged children. We also volunteer to raise awareness of political issues, such as our Breast Cancer Awareness Program. Over the years, we have supported numerous activities dedicated to health, human services, education, the environment, and the arts. We are committed to “Bringing the Best to Everyone We Touch.”

Customer Analysis With a wide variety of product offerings and lines, we have a fairly large customer base. Typical customers range between the age of 22 and 55. Our consumers are mainly women, however we do offer male product lines. Clinique customers are professionals, earning incomes that would distinguish them as members of the upper middle class. They typically live in urban areas or suburbs, where fashion trends are more prevalent. These customers are concerned about their skin, looking for a more natural approach to beauty. Also, the majority of customers are loyal Clinique shoppers and seldom purchase a different brand of cosmetics. In accordance with the Value and Lifestyles (VALS) analysis, Clinique consumers would typically fall into the actualizers grouping. Our customers typically have a large amount of financial resources, a common trait of an actualizer. Also, they enjoy the “finer things” in life and purchase premium products. Actualizers are receptive to new product technologies.

Version 1.0


Market-Product Focus This section describes the three-year marketing and product objectives for Clinique’s Anti-Gravity Firming Eye Lift Cream. It includes a description of our target markets and our product positioning and differentiation strategies.

Marketing and Product Objectives The following are the market objectives that Clinique Laboratories, Inc. hopes to accomplish through the marketing of its Anti-Gravity Firming Lift Cream: Non-Financial Goals

Launch product by March 2001, with distribution primarily in upscale department stores, specialty retailers, upscale perfumeries and pharmacies, as well as online at www.clinique.com.

Gain a 5% market share among existing anti-aging products, with a 10% market

share among prestige brands.

Sell a minimum of one million units in the first year, with at least a 25% increase in sales in the next two consecutive years.

Continue our global marketing strategy by entering markets in Latin America.

Financial Goals

Generate at least $10 million in profits during the first year.

Increase revenue growth by at least 10% per year for the next 3 years. Our specific market strategy will be that of “market development.” The cosmetics industry is crowded with many different manufacturers all striving to make their products successful. At Clinique we are determined to continue our growth in the marketplace and believe that our development and distribution in Latin America will provide us with the potential to substantially increase our earnings. Due to the defining characteristics of our Anti-Gravity Firming Eye Lift Cream, we have developed a “product differentiation” marketing strategy. Our product is made from ingredients that are allergy tested and fragrance free, designed to lift up and firm skin around the eyes that have been affected by time and gravity. The Clinique difference is that the Anti-Gravity Firming Eye Lift Cream is made from a patent-pending formula that renews elasticity by boosting natural collagen, thus building supple cushion back into time –thinned skin, a feature that can not be matched by our competitors.

Version 1.0


Figures 2, 3 and 4 show how Clinique is moving in the right direction for future growth and development. Figures 2 and 3 show where we currently stand in the cosmetics market and Figure 4 identifies the strategy we will take in the future. Figure 2. Market Attractiveness Attribute Weight x Rating = Value

Overall Market Size .05 5 0.25 Market Growth Rate .05 1 0.05 Historical Profit Margin .10 3 0.30 Competitive Intensity .15 4 0.60 Technological Requirements .20 4 0.80 Environmental Impact .25 5 1.25 Social/Political/Legal .20 3 0.60

Market Attractiveness

1.00 3.85 Figure 3. Business Strength

Attribute Weight x Rating = Value Market Share .05 2 0.10 Share Growth .05 2 0.10 Product Quality .15 5 0.75 Brand Reputation .10 5 0.50 Distribution Network .05 5 0.25 Promotional Expenses .05 3 0.15 Production Capacity .10 4 0.40 Production Efficiency .10 4 0.40 Unit Costs .05 3 0.15 Material Costs .05 3 0.15 R & D Performance .20 5 1.00 Managerial Experience .05 5 0.25

Business Strength

1.00 4.20

Rating Legend

1 Very Unattractive 2 Unattractive 3 Fair 4 Attractive 5 Very Attractive

Version 1.0


Figure 4. Portfolio Classification Market Attractiveness 5.0

3.85 3.67

2.33

Business Strength

0.00 5.0 4.20 3.67 2.33 0.00 Figure 4 above shows us that we are in a “protect position.” Clinique has established itself as a prestige cosmetics company and has been very successful as a result. The cosmetics industry will always be open to potential entrants and competitors trying to force us out of this position. Because of this Clinique must continue to grow through Research and Development, and continue to promote our products competitive advantages over the rest of those in the industry. Target Markets For our products, we focus on targeting the end user, as these consumers make the decision to purchase. Our target market is professional people over the age of 35 and will most likely be women. These women are concerned with the signs of aging and trust Clinique, as they believe Clinique is devoted to quality skin care products. These professionals earn middle to upper class incomes and live in urban and suburban areas. They are buyers of fashionable clothing, premium products, and shop in upscale department stores. Also, these customers are often socially and naturally conscious and are drawn to Clinique.

Protect Position Invest to Build Build Selectively

Build Selectively Selectivity/ Ltd. Expansion Manage Earnings or Harvest Protect & Refocus Manage for Divest Earnings

Version 1.0


Product Positioning Proper product positioning can either lead to the success or failure of a new product. At Clinique, we understand this statement and are committed to finding the right niche for each of our product lines. We have developed our products with the belief that each person is different and as a result has different beauty needs. It is our mission to provide these consumers with the products to fit those needs, ones that are allergy and fragrance free, never tested on animals, and are backed by years of Research and Development to prove that they are of exceptional quality, “Bringing the Best to Everyone We Touch.” Clinique’s Anti-Gravity Firming Eye Lift Cream is designed to provide for its users firmer, less lined, brighter skin all around the eyes. This densely hydrating cream actually lifts and firms skin, addressing the effects of time and gravity. Our product is positioned as a cream that will combat the signs of aging through its patent pending formula that renews elasticity by boosting the body’s natural collagen and thus building supple cushion back into the skin. It provides results that go above and beyond.

Product Differentiation Product differentiation is the significant other half of product positioning: the two must work together to achieve success. Many manufacturers offer creams that are designed to reduce the signs of aging around the eyes. Thus, it is detrimental to the success of a product that it carries additional benefits and features that make it more attractive to the consumers than the industry alternatives. Clinique’s Anti-Gravity Firming Eye Lift Cream differentiates itself from its competitors through the advantages listed below:

Patent-pending formula that renews elasticity by boosting natural collagen.

Version 1.0


A price that is considerably lower than its major competitors. We provide a high-

quality product with a price that is more suitable and desirable.

Allergy-tested and 100% fragrance free.

Never tested on animals.

Strong brand equity.

Backed by years of research from Clinique’s notable Research and Development department.

Easy to obtain through upscale department stores and retailers, as well as on e-

commerce website. Lancôme is the only other major competitor that currently has set up such a website.

Backing from strong parent company, Estée Lauder Companies, Inc.

Version 1.0


Marketing Program The section below will describe how Clinique plans to utilize the four components of the marketing mix: (1) product strategy, (2) pricing strategy, (3) place strategy and finally (4) promotional strategy. Product Strategy Our product strategy for Clinique’s Anti-Gravity Firming Eye Lift Cream is “product differentiation.” Products designed by our competitors to reduce the signs of aging have over and over proved to be ineffective and overly priced. At Clinique, we have changed this notion. The Anti-Gravity Firming Eye Lift Cream firms and brightens the skin surrounding the eye, making your skin vibrant and more youthful. Our product uses a well-researched, natural approach to do this: our formula boast collagen, a natural ingredient in the skin that visibly reduces the signs of aging. The Anti-Gravity Firming Eye Lift Cream is a revolutionary fountain of youth for your skin. Price Strategy In order to establish ourselves in this anti-aging products market, we are offering the Anti-Gravity Firming Eye Lift Cream at a moderate price point. The suggested retail price for this product will be $28.50, a price that is slightly less than our major competitors. We are currently trying to penetrate the market with a high quality product at a moderate price, as shown in Figure 5. The perceived benefits of our product is high with respect to the price, therefore Clinique is taking on a value-pricing strategy. Figure 5. Price/Value Map for Clinique’s Anti-Gravity Firming Eye Lift Cream High Price Low Inferior Value Superior

Skim Premium

Average

Version 1.0


Place Strategy Our customers can purchase our products through a couple of different channels. These channels consist primarily of upscale department stores, specialty retailers and perfumeries and pharmacies. Examples of these channels would include Sax Fifth Avenue, Macy’s, Nordstrom’s, Neimann Marcus, Dayton’s, Hudson’s, and Marshall Fields. Clinique is sold to a lesser extent at freestanding company stores and spas, stores on cruise ships, and in-flight and duty free shops in airports and cities. Our products are sold in over 83 countries and territories. The Anti-Gravity Skin Firming Eye Cream will also be available at www.clinique.com, Clinique’s interactive online shop. Customers in the United States can order from this site and have shipping timeline options, depending on their own personal preference. Clinique uses a limited distribution channel to establish itself as a prestige cosmetic company. Our company will distribute the Anti-Gravity Firming Eye Lift Cream through these sources beginning in March 2001. By doing so, Clinique can charge a premium price for its high quality product. Promotional Strategy In order to gain market share for our product, we will have to implement a strong promotional effort, advertising externally, in-store, as well as on our website. We will implement a pull strategy for the Anti-Gravity Firming Eye Lift Cream, directing the promotional mix at ultimate customers to encourage them to ask the retailer for the cream. For our external strategy will be to launch an aggressive national ad campaign. Magazines such as Cosmopolitan, Glamour, Allure and Martha’s Stewart’s Living will display a full-page advertisement with large colorful pictures of the cream. We will also display an ad monthly in the Sunday edition of the New York Times. We will advertise on billboards, such as the electronic billboard at Times Square, New York. Finally, the Anti-Gravity Firming Eye Lift Cream with be advertised via commercials on the Lifetime television station, as well as during the Oprah show, hosted by Oprah Winfrey. This external advertising initiative will be in effect for 3 years. We will also launch an aggressive in-store marketing strategy to gain customer exposure and demand for the Anti-Gravity Firming Eye Lift Cream. In March 2001, we will distribute smaller, sample size versions of the cream through our “Clinique Bonus” program, which is designed to attract customers by giving them sample sizes of a few of our products when they spend over $20.00. The Anti-Gravity Firming Eye Lift Cream will also be coupled with other Clinique skin care products and then sold as a bundle package. We will send each of our distribution sites large color advertisements to display in their stores, as well as small brochures explaining our product and its

Version 1.0


features. In addition, we will train our consultants to suggest the product to potential customers when they are giving individual facials or selling behind the counter. After launching our product in March 2001, we will display a specialty advertisement for our product on the homepage of our website. In addition, we will purchase banners on different well-traveled websites, such as www.yahoo.com or www.netscape.com, leading to our company’s homepage.

clinique gift center

great skin guaranteed

which products are right for you?

foundation finder

acne solutions

going, going, gone.

great dates start here

lash personality quiz

clinique beauty buzz

simple hair care system

registering with clinique

breast cancer research foundation

product directory

shop online

counter locator

bonus time

special event workshops

destination world

love clinique? sell clinique

frequently asked questions

corporate info

legal

privacy policy

feedback

home | shop online | world of clinique | for men only | sitemap | register | sign in/my profile which products are right for you | feedback | privacy policy | faq´s | need help shopping

Version 1.0


Financial Data and Projections This section provides an overview of our past sales data and our three-year projected sales revenue. Past Sales Data Ever since Clinique’s establishment in 1968 sales have increased between 15% - 20% each year. The following are the financial statistics for 2001: Total Gross Income From Sales $5.2 million Less Cost of Goods Sold ($1.0 million) Less Operating Expenses ($2.6 million) Profit Before Taxes $1.6 million Clinique should make approximately $1.2 million after tax expenses. This gives us a profit margin is of about 23%. Three Year Projected Sales Revenue The projected sales will increase by 15% to 20% for the next three years. We will be increasing our Research and Development in order to meet our goal of producing three new products each year. Also, we will be spending large portions of our revenue on advertising and further development of our website. As a result, net profits will go down. 2002 2003 2004 Total Gross Income from Sales1 $6.0 $6.9 $8.3 Less Cost of Goods Sold $1.8 $2.6 $2.9 Less Operating Expenses $3.2 $4.0 $3.8 Profit Before Taxes $1.0 $0.3 $1.6 We believe that with the introduction of our Anti-Gravity Firming Eye Lift Cream, our expansion into Latin America, and our continual development of new products, Clinique should be able increase its profits before tax from $1.0 million to $1.6 million in the next three years.

1 All sales figures are in millions

Version 1.0


Implementation Plan The implementation plan shows how Clinique plans to turn its marketing efforts into results. The following Gantt Chart will show an overview for our projected plans. Figure 6. Gantt Chart

Activity Timeline 2002Q1 2002Q2 2002Q3 2002Q4 2003Q1 2003Q2 2003Q3 2003Q4 2004Q1 2004Q2 2004Q3 2004Q4

Expand into New Markets Latin America ****** ****** ****** ****** ****** ****** Build and Expand Increase Number of Retailers

****** ****** ****** ****** ****** ****** ****** ****** ****** ****** ****** ******

Launch New Products

****** ****** ****** ****** ****** ******

Other Build Strong Relationships with Retailers

****** ****** ****** ****** ****** ****** ****** ****** ****** ****** ****** ******

Increase R & D Spending

****** ****** ****** ****** ****** ******

Develop Product Lines

****** ****** ****** ****** ****** ******

Increase Advertising

****** ****** ****** ****** ****** ******

Version 1.0


Evaluation and Control Through this marketing plan, Clinique has strategically defined its three-year marketing outlook for both its company and for its new product launch, Clinique’s Anti-Gravity Firming Eye Lift Cream. Our corporate and product missions and goals have been projected and our methods for achieving these goals defined. It is now our mission to implement this plan. To guarantee success, Clinique will need to re-evaluate our progress towards these goals each quarter to determine if our marketing mix is working properly and profitably. To do so, we will assess both our Gantt Chart and our sales figures. If it appears we are not meeting our goals each quarter, we will need to analyze our marketing plan and make adjustments if we determine that we have set unreasonable goals. The final authority for implementation and evaluation of this marketing plan is the project Marketing Director.

Version 1.0


Resources

www.clinique.com

www.elcompanies.com

Estée Lauder Companies, Inc. 2000 Annual Report

www.lancome.com

www.aveda.com

www.shiseido.com

table of contents - econunivpm · table of contents company description ... swot analysis ... all...

Documents