Garnier and Revlon in China
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[pic 1]1. OVERVIEW OF GARNIER & REVLON1.1 COMPANIES BACKGROUND 1.1.1 Garnier Garnier a French cosmetics brand under L’Oreal, was established in 1904 to the French consumer market (L’Oreal USA, n.d.). Offering a wide variety of beauty products, including skincare and hair products, Garnier is well-known worldwide, promoting young, healthy, and natural beauty. Garnier’s skin care products focuses mainly on face care and sun care, among other beauty products. Garnier’s BB Creams were a global success (Braizaz, 2014), for it was regarded as a smart skincare solution, with its all-in-one benefits of smoothing, brightening and evening the skin tone on top of other skincare benefits. Additionally, Garnier has also worked together with skincare professionals to formulate products catered to Asian skin and each range features a different core ingredient that has a unique set of beneficial qualities, like for instance, the Sakura White product line. 1.1.2 RevlonRevlon was founded in 1932 and has a worldwide image as a top trendsetter for cosmetics products (Revlon, n.d.). Revlon’s mission is “to emerge as a global leader in cosmetics and personal care” as well as to provide products that caters to the needs of women no matter the age range. For decades, Revlon has also maintained a cruelty free image. Revlon is known mainly for its color cosmetics, but also has products in hair colour, beauty tools, fragrances, skincare, antiperspirant and deodorants. Some of its successful colour cosmetics sold include foundations, lipsticks, mascara, eyeliner, BB creams and nail enamel which are often produced in tandem with global trends (Revlon, n.d.).1.2 MARKETS SERVED1.2.1 World Markets 1.2.1.1 Garnier Though Garnier’s home market is in the US, it has continued to branch into many foreign markets, mainly in Western countries but also Asian countries. As of 2013, it has operated in various Chinese markets like Taiwan, Hong Kong, and China. However, despite its variety of natural beauty products, Garnier took up only 1% of L’Oreal China’s sales worldwide in 2013 (Saigol and Waldmier, 2014), leading to L’Oreal’s decision to focus on its two leading brands, L’Oreal Paris and Maybelline New York (Reuters, 2014).1.2.1.2 RevlonSimilarly, Revlon has its base market in the US. Even though Revlon has broken into many foreign markets, the US still dominates Revlon’s worldwide sales by more than half. On the other hand, Revlon has limited presence in other emerging markets, particularly China. According to the statistics of the first quarter in 2013, Revlon’s market in US, Latin America and Canada has grown significantly in the second quarter, but other markets shows a nets sales decrease; with $5.1 million in Europe, Middle East and Africa, and a drop of $2.5 million in Asia in the same period last year (Revlon Annual Reports. 2013). Hence, despite entering the world’s largest personal care products market since 1996, its sales in China took up only 2% of its global sales in 2013 (Kaiser, 2014).
1.2.2 Chinese Consumer’s Tastes and PreferencesIncreasingly savvy Chinese consumers – particularly those of the middle class – are now looking past the prestige of Western brands and are more concerned about the quality of products and its value for money (Global Cosmetic Industry, 2014). Both Garnier’s and Revlon’s main consumer market can be generalized to the urban middle class in China, but while Garnier’s focus is more on the mass-middle class, Revlon narrows its target towards the female upper-middle class. 2. INTERNAL ANALYSIS OF GARNIER & REVLONTable 1 Strengths & Weakness SummaryGarnierRevlonStrengthsProduct: natural and convenientPrice: affordablePromotion: Consistent advertising theme.Promotion: Chinese celebrities endorsement in advertisements.Product: world-renowned brand with high quality cosmetic productsWeaknessPromotion: Utilize only traditional promotion strategiesPlacement: Sold only in supermarkets with other cheaper alternatives found.Placement: lack of penetration into e-commerce marketProduct: lack of diversification and does not pander to the tastes of Chinese consumers.Price: Not justifiable to consumers due to other more price-competitive brandsPromotion: failed to create a brand that is attractive to Chinese consumers, constrained by its consistent global image Placement: confusing brand placement in both high and mid-tier retailers; lack of penetration into e-commerce market 2.1 MARKETING MIX STRATEGIES2.1.1 Product Strategy in China 2.1.1.1 Garnier The brand is committed to naturalism, setting a vision of possessing ‘natural beauty’. Hence, its products are made of high quality and all-natural ingredients. They offer many unique products, incorporating a variety of natural ingredients such as sakura and grapefruit. Garnier’s product packaging also adopts an eco-friendly approach, utilizing 40% of recycled glass for their skin care line (Garnier, n.d.). All these form Garnier’s brand identity as a natural and convenient beauty brand. 2.1.1.2 RevlonIn comparison, Revlon is less committed to product innovation and customization. Most of Revlon’s China products are the same products found in Western countries, which fails to cater to the preference of Chinese consumers for organic and herbal ingredients. In a survey done by Mintel, Chinese women did not desire for Revlon’s colour cosmetics due to their preferences for natural products that were better for their skin (Petzinger, 2014). This is due to Revlon’s goal of “global consistency” in image, to prevent “inefficiency in using separate technology, sourcing and creativity” for every different market (Kagan, n.d.). Hence, Revlon’s failure to diversify their products to sui the Chinese tastes resulted in a loss in market sales.