Studies have shown that of all luxury markets, beauty products industry is among the fastest growing markets in the world. Retailers and other industry players, such as designers have reported a booming demand for luxury beauty. United Kingdom is one of the countries with a well established luxury beauty products industry. Beauty products market segmentation in the UK includes, use of pictures, detailed company information, special offers, customer ratings and reviews.
There are many types of brands in UK beauty industry depending on the products attributes, benefits and symbolic dimensions. The consumers make decisions both rationally and emotionally, hence for retailers to achieve proper branding they have to combine both the rational and emotional components.
Two common types of brands used in beauty industry are: functional and symbolic. The functional brands focus on the visible benefit of the product. For example, Nivea products are functional, in that they are meant to care for the skin. Symbolic brands are emotionally dimensional because the customers consider the effect of the product in the future or on their health, For example, a mother will be very keen when buying cosmetics for her child.
Globalization of brands has been attained because of the fast growing communication links, transportation and easy flow of money. This has enabled greater access to larger markets, but there are also specialized brands for specific locations that are not global (L’Oreal International 2010).
The beauty market offers various categories of products, which include; First category, skin products, these are; body oils, creams and lotions. These products are used to make the skin smooth and cure skin conditions like stretch marks, cellulite, acne and spots. Facial creams e.g. cleansers, lotions and toners are used to make the face smooth give a uniform color and texture. Hair care products like; relaxers, hair oils, lotions and sprays are used to make the hair more strong, beautiful and natural.
Men’s products like shaving creams, toners and after shaves are also available in the market. This is new in the industry and has received positive regard from the men. There are also products for oral care like gels, pastes and mouthwash. They are used to strengthen the teeth, improve mouth breath and also some of them make them whiter. Bath and shower products; body wash, creams, gels and soaps for bathing. They help kill germs and treat the skin.
Second category are generalized as make ups, they are used to refine facial appearances. “These products include; lipstick, lip gloss, liner, balm, conditioners and boosters all for the lips.”
Other products are; foundation, which is used to level out the face, plaster spots and patchy skin shadow; mascara, a liquid, cream or powder, is used to dim, solidify and elongate the eye lashes; powders used to set the foundation giving a fine finish and conceals small flaws; “Rouge, blush or blusher used to reveal the cheeks’ color and also makes the cheek bones look more define. It comes in powder, cream and liquid forms.”
Other beauty products are deodorants. They are applied to the body to bring out a pleasant body smell. Though some people are allergic to deodorants and may experience skin conditions if they use them. Deodorants are divided into many types, including: antiperspirants that prevent bad odor and reduce sweating; eye liners, shadow and shimmer used to emphasize on the eye lids. They make eyes appear larger and give a youthful look; and other products like nail polish, concealers and emulsions, etc.
In the fashion industry products are identified with their brand name which distinguishes them from the other products in the market. A brand is the identity of a specific product or service. It is the personality of a product and how it relates to key constituencies. Brands are very vital in marketing of products.
A good brand will communicate the information distinctly, making the product look credible, connect to the target audience, motivate the buyer and build customers goodwill. The beauty products named above come in different brands.Some of these brands are Dior, Armani, Chasnel, Clarins, Clinique, Estee, Lauder, Guerlain, Kenzo Saint Laurent, Versace, Sisley, Shisedo, Lancome ,La Prairie Mac ,Borghese, Smashbox.
The price for these products ranges from low, medium to high depending on several factors like quality, quantity, availability, and demand of the product. There are sales offers to enable people to buy what they term as expensive to them. Most of the stores have assistants that help customers get what they want then pay at the cashier’s desk while others pay directly to the assistants.
Luxe corp says that “These beauty shops also offer other services to enable them meet their customers’ needs. The beauty shops offer other services like massage manicures pedicures, spas facials and body treatments.” An example of these shops is Beauty 2000: it offers acne and aging treatments, tattooing, facial care, skin care and others. The beauty shops are located in all types of locations both exclusive and commercial where they are easily accessible and discoverable (Luxe corp 2010).
The luxury beauty products industry has grown enormously all over the world. It has even been diversified by having products for men too and not focusing on women only like it was a few years ago. More men-targeting products should be introduced and marketing done to convince men to use them as some of them have not yet agreed to use of luxury products they argue it is gay.
The branding of products has been major element that has assisted in marketing of luxury beauty products Beauty products have been known to transform people and even build their self esteem; hence the industry has also helped solve psychological problems.
Some of the big beauty stores in London are Harrods on Brompton road Knightsbridge founded in 1813. It started as a linen store and later was bought by a distributor of branded goods. It is well known for its fashion and beauty accessories made by prominent designers. Other major store in the UK is the Selfbridges, a chain of department stores founded in 1909.
These big stores have faced criticism, for example Harvey was once accused of harassing a man who was selling a magazine that had bad information about the store. Selffridge was once accused of using rotten raw materials for enhancing the products which were health hazard.
Due to the culture and economy of UK, fashion has always flourished despite the economic crisis witnessed recently, as indicated by the many high end fashion stores emerging all over London in a bid to satisfy the ever fashion hungry capital. These stores have recognized that the world of fashion has changed significantly due to globalization and melting of once diverse cultures into one.
The London inhabitants shopping trends have also changed in relation to this. This has been due to many fashion options for them to choose from and also availability of major fashion houses in the world are located in the UK. In addition they are style cautious which is boosted by the healthy economy that allows them to spend on such luxuries. Hence for any shopper looking for high end fashion and style products, London is a city that avails this all at once.
The fashion industry is a major revenue source in the UK. It brings in revenue through the beauty shows, trade events, and expositions on beauty products. The Natural and Organic Products of Europe Conference was leading event on lifestyle products. It led to an increase in sales for organic supplies and personal care products sales went up by 53%London’s beauty industry is attractive and has great potential.
However, during the 2008-2009 global economy recession, worldwide luxury beauty industry sales fell by 8%. Luxe corp (2010) notes that “the recession was bad news for luxury brand owners, with consumer spending hit hard, with on online sale of luxury goods being one of the major contributors of the recession.” This led to an increase in digital marketing in the industry, but some brands are still reluctant due to fear of losing control of their brands. The recession led to a cultural drift in terms of consumers’ attitudes and preferences.
L’Oreal International (2010) shows that “luxury brand owners have become more relaxed on allowing people to talk about their brands in social media. This has created openness in the sector which was a rare trait before the recession. The brand owners were manipulating, protective and conservative, as a result tension existed between the desires to capitalize on digital platforms and hence the fear of losing control of their brands.”
The major drivers of the industry whom are the stakeholders, that is, the government, manufactures, the distribution stores and the designers should put more energy creativity and diversity in the industry. That way they can bit their major competitors since they have the advantage of trust that these products are safe for their health.
However, with the dynamism of the cosmetic industry in UK, improvements need to be made to match up to the bigger industries, such as the United States. Companies should diversify their products to a wider range in order to cater for the different needs of the customers globally.
The beauty industry in London needs to come up with pricing strategies, methods and models for their products, which meets the demand of the market and satisfy all customers exclusively. One of the strategies is the price theory. This theory emphasis that the business has to break even, that is, the price charged should cover both the fixed and variable costs.
From the price theory, a company can choose from the three ways of pricing; first, maximum pricing, this is setting the price a little above the breakeven point, make a small profit per unit but sell more. Secondly, skimming strategy whereby a firm sets the price as high as the customers can pay with hope of getting back the value of the costs incurred as soon as possible. This involves different prices for the products depending on their attributes (Kiehl, 2010).
Companies need to come up with an effective marketing strategy adaptable to their specific industry. The four commonly applied elements of marketing include: first, segmentation, this is dividing the markets into various groups.
Specific products should be sold with the consumer group attitudes and preferences in consideration; for example, some people shop to release stress, others to keep up with new trends or addicted to shopping, while others prefer advertisements that are informative not flashy or vice versa.
Secondly, targeting; this is identifying the audience of to whom the product targets. The retailers should know the spending capacity of the target group, and the age to avoid being irrelevant. Importantly, the products availability and price features need to be communicated to the group targeted.
Thirdly, are the channels of distribution, promotional tactics and mode of communication. A beauty products company can reach its target audience through advertisements on radio TVs, magazines billboards and the internet too; a company can also organize events like fashion shows and beauty pageants (L’Oreal International, 2010). Companies should also embrace online marketing as a means of reaching to their customers and boosting their sales volumes.
Types of digital media being used are social media like face book, Twitter and mobile phones service. Lóreal a major luxury beauty product distributor is one of the brands that have embraced digital marketing. “It has highlighted modes for digital marketing strategies for all its goods, by adopting a more integrated approach abandoning previously piecemeal strategies.”
Due to the vulnerability of the fashion industry to economic situations, companies need to adopt new, creative and more sophisticated ways to market their luxury and fashion products. There are mainly two means of approaching the industry situations: Firstly, the blue ocean strategy, which is aimed at improving creativity.
The economy is taking deviations and the players need to find new means of growth and remaining relevant in the market. Secondly, pull strategy, this is the main driver of the demand for luxury products and is aimed at holding the company’s clients even in cases where customer’s attitudes and preferences are varying.
For companies to meet the demands and challenges put across by the fashion cautious city, they need to catch up with the ever changing fashion trends and embrace flexibility in their production by diversifying their brands, mode of retail, marketing and service. This has been witnessed in the kind of products that the design and fashion houses are always producing, for example D & G has changed from the traditional production of colognes and taken up the current use of celebrities in naming and promotion of their products.
By so doing their products are associated with a certain status quo in the society. In addition, the fashion houses are spread all over the city making them quite accessible to the shoppers. However, these fashion houses are not sprawled all over the city but are located in high end streets and buildings. Hence majority of the fashion houses are found in grand buildings like the Harrods complex which has housed major fashion houses for very many decades (Allured Business Media 2010).
Apart from locality, these fashion houses need to anticipate expected trends in fashion and indulge in the production of more stylish products for the consumers in the city, thus they should always be ahead of their customers in the production of products therefore being able to retain their clients relationship.
Fashion stores in London have also embraced a new culture of service whereby each and every customer is normally given an attendant to assist them while shopping. This is usually found in large fashion stores or houses. In addition during the shopping spree, the customers are exposed to a wide display of current fashion items whereby they are spoilt for choice.
Furthermore to make the shopping experience friendlier, the shoppers are always served with refreshments giving them a friendly experience which the London shoppers value very much. This trend has been witnessed in fashion houses like Giorgio Armani, Marks and Spencer, among others.
In conclusion for the fashion houses to satisfy the customers’ fashion needs, they need to produce new high end products while embracing new strategies in their production structures.
In addition, they need to be more effective in their advertising, selling and after sales services since majority of these products are very expensive and delicate and thus need constant care, as seen in design houses like Christian Dior, where they have initiated new brand names for the market, other fashion houses should also take this up thus connecting with the fashion savvy costumers.
Furthermore, the stores should open up other branches in high end areas in order to cater for customers who do like the hassle of the city while doing their shopping which they usually while taking a lot of time. Another way is interacting with customers in a positive and friendlier way by offering customised and smart limited editions, second hand brands, offering renting options, giving customers a retail experience.
Reference list
Allured Business Media, 2010. Cosmetics & Toiletries. (online) (Updated 1st March 2010) Available at: https://www.cosmeticsandtoiletries.com/ .
Kiehl, 2010. My Kiehl’s. (Online) (Updated 14th February 2003). Available at: www.kiehls.com.
Luxe Corp April, 2010.The Luxury Business Magazine. (Online) (Updated 15th Jan 2009) Available at: http://www.luxe-mag.com/ .
L’Oreal International, 2010. L’Oreal USA. (Online) (Updated 10th July 2009) Web.