Sephora Body Care Centers Marketing Plan 2011

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1 Sephora Body Care Centers Marketing Plan 2011

2 Table of Contents Part One : STRATEGIC PLANNING 1. Analysis of the Current Situation 2. Achievable Marketing Objectives Part Two : ACTION PLAN 3. Yearly Action Plan & Marketing Budget 4. Control Procedures & Criteria of Success

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4 Profile of the Company TYPE : Division of Holding Company LVMH INDUSTRY : Consumer Goods FOUNDATION : 1969 by Deeba Abrishamchi HEADQUARTERS : Paris, France PRODUCTS : Cosmetics & Beauty PARENT : LVMH Louis Vuitton Moët Hennessy S.A. WEBSITE :

5 1.1. Macro environmental analysis Political Environment legislation for the health of the nation and the quality of products and services Social Environment Changes in social trend, lifestyle; the population has been ageing and demand for cosmetic products and services has increased, norms and values: to be beautiful; 1

6 1.2. Market Analysis Substitutes Natural products, Cosmetics and fragrances sold in retail stores Barriers of entry Image of a brand internationally known, Organization and logistics, Width of ranges, Marketing force of the existing companies See Appendice 1.2 Bargaining power of suppliers Suppliers need Sephora to sell their products and touch the target market they aim at, they have to sell at the same price everywhere Bargaining power of customer The customer has a stronger bargaining power than the suppliers, since they can decide to buy what they need at the competitor s 2

7 1.3. Direct and indirect competitive analysis INDIRECT COMPETITION Qualitative competitors: Drugstores, supermarkets, Reserve Naturelle DIRECT COMPETITION Marionnaud, Nocibé, Douglas, Yves Rocher For more details, see Appendice Market Segmentation First, Sephora s target is women between 18 to 60 years old, belonging to a middle class (monthly wage from around 1200 to 2200 ) or upper middle classes (2200 to 3200 ). Sephora s second target is men between 20 and 55 years old, belonging to both classes. 3

8 1.5 Marketing Mix Our actual marketing-mix is composed of: 30% of the offer mix: Sephora proposes a complete range of products 35% of brands: products sold at Sephora belong to famous and well known brands 15% of service quality: salespersons follow customers in their choice 15% of physical attributes: good product quality 5% price: prices fixed by beauty stores are quite the same Our actual promotion-mix is composed of: 60% of Direct Marketing 30% of Advertising 10% of Public Relations For More Details, see Appendice 1.5 4

9 1.6 SWOT Sephora is located downtown Troyes where there are a lot of competitors. New trends on the market, but competition seeks for the same goals. For more details, see Appendice 1.6 5

10 1.7 Positioning USP: - Diversification of products - Own brand products - Customer services quality - Store presentation - Packaging -Atmosphere Sephora s main competitors: Marionnaud, Nocibé, Douglas Sephora s best perceptual map is the one including the diversification of the products and the own brand products. This means that Sephora is the leader on those two points. Fore more details, see Appendices 1.7 6

11 1.8 Sources of Information QUESTIONNAIRE See appendice «Questionnaire» COMPANY S WEBSITE WEB

12 2.1 Marketing Strategy Next year, Sephora is going to launch the project of a body care center in Troyes. The Spa will provide massaging and waxing services. 2.2 Desired Marketing Segmentation The first market is women living in Troyes and the suburbs, between 18 and 45 years old, and who belong to the middle class or the upper middle class. The second market chosen for the new service is men living in Troyes and its suburbs, aged between 20 and 45, belonging to the upper middle class. 8

13 2.3 Desired Marketing-Mix Next year, we will improve both price and quality of service of 5%. We will put all our efforts on public relations to improve it of 10%, organizing an opening event and others. For more details, see Appendices Marketing Objectives - SWOT The Beauty market is influenced by new trends and Sephora can offer such treatments. For that, it may: Attract costumers of main competitor Yves Rocher. Set up a satisfied or refunded policy to reassure clients. If this project doesn t work, it might be hard on Sephora s finances. For more details, see Appendice 2.4 9

14 2.5 Positioning The best situation for Sephora is the one mixing «own brand products» USP and «diversification of products» USP. Next year, we will improve both of them. To do this, we have to invest money on developing Sephora s own brand products. For more details, see Appendice Yearly Sales Forecast Combining the two kinds of services proposed, we evaluate the yearly sales forecast at To reach this result, Sephora would have to fill every single day, with appointments. For more details, see Appendice

15 3.1 Main Cooperative Bodies (1+1 > 2) We have decided to cooperate with Yves Rocher : Shops in the same area Sephora transports a luxury image (famous brands) Yves Rocher has a family and biological spirit. Combine our strategies to attract new costumers New model that Yves Rocher will support through its experience in natural products. We will increase their revenues by offering their natural products Cooperation will be detailed on Sephora s Homepage. 11

16 3.2 Retaining Marketing Activities Sephora should continue : Selling its own brand of makeup and body care lines, to keep its advantage on competitors Focusing on seasonal promotion (Christmas, Mother s Day ) Giving samples to customers Its advertising campaigns (through website, posters ) 3.3 Developing New Offer We could start the project by : offering massages and waxing building 2 rooms for treatments keeping the same schedule as for the shop (10 a.m. to 7 p.m.) hiring professionals beauty therapists (and train beauty counselors at the shop if we break even) middle range price (40 for a 30 min. massage) promote through posters, website, newsletters 12

17 3.4 Marketing Promotion (7 P s) Free gifts Point of sales materials Information points Loyalty cards Word of mouth Magazines / Newspapers Social Networks Special Offers & Competitions For more details, see Appendice

18 3.5 Enhancing Service Marketing Principles (3 P s) Employees: Sephora could first hire professionals to come to the Spa and perform the massaging according to the registered appointments. When services are developed, Sephora could use trained employees. They should however wear the Sephora uniform. Location: The Spa could take place in two rooms, at the back of the actual store. One room for massaging and another for waxing. See Appendice GANTT Scheme 3.7 Marketing Yearly Budget See Appendice

19 4.1 Control Bodies Meetings between Marketing Manager and regional managers every 3 months, regarding marketing action plans. 4.2 Control Tools 1. Surveys would be conducted to study the level of customer satisfaction. It can be oral or by filling questionaires in the stores. 2. Sales promotion activities 3. Store managers have to submit monthly reports to the regional manager. 4.3 Control by Milestones Special offers in weekends. Launching of new products in weekends. 15

20 APPENDIXES

21 Appendix 1.2 Barriers of entry Estimated to 0,3 Bargaining power of the customer Bargainin g power of suppliers Estimated to 0,2 Estimated to 0,4 Substitutes Estimated to 0,1

22 Appendix 1.3 Critical Success Factors of Sephora Diversification of products, + own production Customer Service + samples Products/store presentation Marrionaud s Less salespersons, freedom of the customer More samples given Advantages with membership Nocibé s Warm atmosphere, colors Quick payment, not much time to wait at the cash register Quality of products Product packaging Slightly lower price Bio products Atmosphere/ smell Products sometimes less expensive

23 Appendix 1.5 Quality of services 15 % Physical attributes 15 % Offer Mix 30 % Price 5 % Brands 35 % DIRECT MARKETING 60 % ADVERTISING 30 % PUBLIC RELATIONS 10 %

24 Appendix 1.6 Strenght Weakness Shop situated in Downtown Troyes Eye catching decoration and lighting Products in self service Once there were two Sephora shops in Troyes the other one had a high clientele that sought for advice. Since it closed, the high clientele goes to Marionnaud Opportunity New trends : men, organic, black skin tones People spend a lot into cosmetics (250 / year / person) Threat Very hard concurrence (Marionnaud, Nocibé, Douglas), similar products and pricing Numerous regulations (Environment and Health)

25 Appendix 1.7 Atmosphere Customer Service quality D S S D Packaging N Store Presentation M M N Douglas Nocibé Marionnaud Sephora

26 Appendix 1.7 Own Brand Products S N D This perceptual map is the best for Sephora. Diversification of products M Douglas Nocibé Marionnaud Sephora

27 Appendice 2.3 Quality of services 15 % Physical attributes 15 % + 5 % Offer Mix 30 % Brands 35 % Adaptation of the marketing mix Price 5 % + 5 % New marketingmix Quality of services 20 % Price 10 % Offer Mix 25 % Brands 30 % Physical attributes 15 %

28 Appendix 2.3 ADVERTISING ADVERTISING DIRECT MARKETING 30 % DIRECT MARKETING 25 % 60 % 55 % PUBLIC RELATIONS 10 % PUBLIC RELATIONS 20 %

29 Appendix 2.4 STRENGHT WEAKNESS OPPORTUNITY THREAT O into S: Nowadays beauty care is influenced by new trends (men, pregnant women, organic treatments). Sephora could offer such treatments to its potential clients (massage with only organic products). T into S: Yves Rocher is a recognized Beauty Center in Troyes and main concurrent of Sephora. If we have an appropriate eye-catching decoration and people pass by the Shop going to Yves Rocher across the street, we could attract more customers. W into O: Sephora has never provided such services before and could be considered as novice. Maybe it would reassure its clients if Sephora put in a «satisfy or your money back» policy. W into T: As said before, Sephora is new on the Beauty Care Centers market and if it is not efficient and enough competitive, it could go bankrupt. Group ESC Troyes 29

30 Appendix 2.5 Own Brand Products Next year we will move from to N D Diversification of Products M

31 Appendix 2.6 Massage 30 minutes: 40 2 massages per hour, opened from 10am to 7pm 18 massages per days: 720 per day. 540x6=4 320 per week 3240x52= per year Waxing Face 20 minutes: 15 : 405 per day : per week per year Legs 30 minutes: 30 : 540 per day: per week per year Bikini 15 minutes: 30 : 1080 per day : per week per year It is impossible to perform several waxing services at the same time. The yearly sales forecast is thus impossible to plan in a exact way. Actually, we can forecast an average result of per year. Total Yearly sales Forecast: =

32 Appendix 3.4 Free gifts a free 15 minutes-face-massage when contracting more than 2 another services Point of sales materials posters, displaying stands in the store present the product/service to the customer Info points we will present our new service with experts and trained staff so that customers can get information Loyalty cards a customer fills up a card and is rewarded with a free treatment. Word of mouth - the best form of advertising because 70% of consumers trust peer recommendations and only 18% trust advertisements. Flyers distribution to get recommendations to get a positive effect on the business. Encourage people to talk about us. Magazines / Newspapers they are effective - magazine advertising would be better value for money. Younger people of our market through magazines. AIM : raise our sales by 10 % within 6 months. Lower television advertising in exchange for magazine advertising and to keep within the same budget, whilst increasing exposure Social networks are one of the best opportunities on the Internet - Facebook users provide information such as their age, gender, location and interests. Target our ads directly to the demographic we want to reach. - we will also use our marketing list people who have expressed interest in knowing when we offer new services. We have segmented our list so that we can send appropriate s to media and our customers. Special Offers & Competitions we offer our customers free «beauty tips» after the massage therapy to attract their attention - this special offer can convince unsure customers to make a purchase.

33 Appendix 3.6 What? Start When? Finish Who? How much? Comment Sales Promotion Mothers day A week after father s day Assistant of manager in collaboration with head office See 3.4 Advertising 3 weeks before starting date A week after fathers day Marketing team of head office See 3.4 Public Relations 3 weeks before starting date A week after fathers day Marketing team of head office See 3.4

34 Appendix 3.7 Resources in % Expenses in % Loan 70 Promotion: 25 Free gifts > 2 Equity 5 20 Point of sales materials Info points Loyality cards Advertising: 30 Interest Income 5 Word of mouth Magazins / Newspapers Facebook 15 Special Offers Marketing Research: Analyst fees Publich Relations: PR campaign support Non allocatd funds: Total budget 100, ,000

35 Questionnaire (Translated to English) 1. What is your role within Sephora-Troyes? 2. What do you think about adding a body-care service in the store? 3. Do you think it would suit the company s vision? 4. Why could it be an advantage for the shop? 5. How could the company promote this new line of services? 6. According to you, how could Sephora compete with companis like Yves Rocher, already providing waxing and massaging? 7. How much do you think customers would be ready to pay for a 30-minutesmassage? 8. Would you be ready to receive a professional training to perform massaging and/or waxing? 9. How long have you been working in Sephora-Troyes? 10. Could Sephora develop and add a line of massaging products ot its own brand products?

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