Mary Kay Cosmetics Products is a multi-billion greenback corporation, with over 1.7 million consultants employed in over 36 international locations worldwide. Founded in 1963 (with funding of solely $5000), this direct selling business enterprise has gradually developed into an essential aggressive pressure in today’s cosmetics industry. With a mission to “enrich the lives of women,” this business enterprise has utilized direct promotion to supply its personnel with limitless possibilities (Mary Kay Cosmetics). The purpose we selected to look up Mary Kay (Case study) is due to the fact of the company’s superb increase and success.
Here are the articles to explain, Mary Kay Cosmetics Products Essay
With over 200 beauty products and 5 exclusive product lines, this organization has performed its intention of catering to females of all while and pores and skin types. The following document focuses particularly on Mary Kay’s Timewise Collection. The cause we selected to look up this specific series is now not solely due to the fact it appeals to the company’s goal market of middle-aged women. It is one of the first strains the enterprise ever added and has always remained a high-quality vendor for Mary Kay. By making use of the advertising ideas of segmentation, the Marketing and advertising mix, SWOT analysis, and social accountability this file will explain how these techniques have contributed to the success of this business enterprise and the Timewise Collection.
The best Marketing and Advertising of Mary Kay Cosmetics MIX
Product
Mary Kay offers its customers an array of beauty and skincare products. All of which separate into product lines that target specific problem areas and skin types. At the heart of these product lines is Mary Kay’s anti-aging collection, Timewise. The Timewise Collection (which appeals to the majority of Mary Kay’s customers) consists of moisturizers, replenishing serums, eye-firming crèmes, and cleansers. The purpose of these products is to renew the look of the skin by decreasing lines and wrinkles. This achieves by the natural ingredients and formulas contained within each product. These ingredients include gliadin, pomegranate extracts, vitamin A derivatives, vitamin E derivatives, and Lucentrix complex (Mary Kay Cosmetics).
Collection Products
Products from the Timewise Collection contain gliadin, a rich source of amino acids, because of the ingredient’s ability to firm and tighten the skin. Pomegranate extracts and vitamins A and E use to neutralize premature aging caused by the sun and the environment. Finally, the Lucentrix complex is used because of its ability to reduce discoloration and age spots (Mary Kay Cosmetics). The Lucentrix complex is a formula developed and patented by Mary Kay’s team of dermatologists. This creates value for the company’s customers because this formula is exclusive to Mary Kay products.
Another way the company creates value for its customers is by offering a 100% satisfaction guarantee. By employing a team of board-certified dermatologists and scientists (who conduct over 300 000 tests a year), the company proves its commitment to delivering customers products of unquestionable quality and value (Mary Kay Cosmetics). In this case, the augmented product is the company’s 100% satisfaction guarantee and the ingredients are the actual products that all contribute to the core benefit of the Timewise Collection, which is to assist customers in reaching their full potential by instilling confidence by providing timeless beauty.
Place
Mary Kay’s various distribution channels are another way in which the company has created value for its customers. Although Mary Kay products can’t be purchased from retail outlets, they can be purchased via the telephone, through one-on-one consultations, online as well as group consultations. This method of direct selling has given Mary Kay a competitive edge over its massively distributed competitors. The benefits of this strategy include speed, convenience, access to comparative pricing information, and most importantly, customer relationship management. Rather than driving to a drug store to look for the product one needs, Mary Kay customers have their products delivered right to their doorstep.
Another benefit of this distribution method is the overall experience provided to customers. By conducting one-on-one consultations, customers are offered advice, informed of new products, and allowed to address any questions or concerns they might have. This is another factor that makes up the augmented product created by Mary Kay. Because consultants are provided training to fully heighten their product knowledge. The company has more control over how its products are presented and pitched to customers. This creates a competitive advantage for Mary Kay as opposed to their mass-distributed department stores competitors such as Revlon and Covergirl.
Price
One of the goals Mary Kay attempts to achieve when pricing their products is to fill their customer’s make-up bags without emptying their wallets. Of the 200 products the company offers, 100 of them are $18 or less. Although these prices are fairly inexpensive, the company considers Lancome, Estee Lauder, and Clinique (all of which consider to be “prestige brands”) as its main competitors. In terms of the Timewise Collection, Mary Kay’s target market is middle-aged women (30-49). At this point in the life cycle, individuals of this age are either advancing in their careers or getting close to it. This explains why the company can price its products between $20-$50.
Although this may seem excessive, compared to the “prestige brands”, Mary Kay utilizes the market share leadership strategy, by charging significantly less than its competitors. For example, the anti-aging moisturizer from Mary Kay’s Timewise Collection works out to $0.40/ml of the product while Cliniques works out to $1.17/ml, Lanacome’s $1.27/ml, and Estess Lauder’s $1.79/ml. While these prices are significantly high, there are other brands, such as Covergirl and Maybelline, who set their price significantly low. The cosmetics industry, is, therefore, under monopolistic competition.
Estee Lauder promotes their product as being high quality and effective, while Covergirl promotes its products as being highly affordable. In the middle is Mary Kay and the Timewise collection, this is an example of value pricing. This could also be a form of psychological pricing. By offering products for a price that is lower than the prestige brands but higher than the lowest brands, customers who can’t afford Estee Lauder or Lana-come may choose to purchase Mary Kay over Maybelline because of their perceived value regarding price.
Promotion
The first tool in the communication mix is advertising. Because Mary Kay is a direct selling company, television advertisements are scarce. All consultants work independently as their own business. Thus it is up to them to make their products known to the public. Mary Kay promotes primarily by word of mouth; the relationships between the consultant and the customer are, therefore, incredibly important. One form of advertising that the company did engage in was sponsoring the Country Music Awards in 2009. The reason is that the first Mary Kay location was established in Texas. Thus, some of the company’s oldest and most loyal customers reside there. This made the sponsorship an easy choice for the company.
The second tool
This tool in the communications mix is sales promotions. Mary Kay’s introduction of the “Mary Kay Rewards Visa Card”, is one way in which the company has provided. Its customers with an incentive to purchase their products. Customers earn points for every dollar they spend at Mary Kay, and are eventually rewarded with coupons and gift cards.
The third tool
This tool in the communication mix is public relations. Mary Kay is a big believer in giving back to the community. The “Mary Kay Charitable Foundation” donated over $5.8 million to women’s shelters and domestic abuse programs in 2009. The company’s “Pink Doing Green Foundation” planted over 200 000 trees in the Bitterroot National Forest (Mary Kay Cosmetics). Mary Kay does not condone animal testing and is a proud member of PETA.
The fourth and fifth tools
These tools in the communication mix are personal selling and direct marketing tools. As stated before, the company’s utilization of direct selling has allowed the company to build strong and profitable relationships with its customers. The company creates value for its customers by delivering products to their doorsteps and introducing new products and features. The company’s use of the telephone and internet as purchasing tools creates value for customers because of its convenience and speed.
Mary Kay SWOT ANALYSIS
Strengths
Mary Kay sells a wide range of products in 4 major categories. These categories include skincare, makeup, spa, and body and fragrance. They sell products for both people of all which has helped them in controlling the cosmetic market. The company develops and manufactures its products as well as performs its testing and packaging. Mary Kay sells products to fight aging, including the Timewise collection, which has become a major concern for older women. In the spa and body category, they have products including sunscreen, hand and body lotions, shower gels, and body washes. Mary Kay’s diverse portfolio, targeting customers of any age, allows them to cover almost all segments of its market.
One of the Only Privately Owned Family Companies That is Debt Free
Being debt free is a huge advantage for Mary Kay. Most privately owned, family-operated, companies remain in debt for most of their lifetime. Having the extra money, not going towards debt, means that they can spend it on other things like research and development, testing, and most important incentives for theirs. The ability to do adequate research and development and testing allows the company to offer the best quality product to fit the needs of all people in their market from teenagers to consumers 50 and older trying to enhance their image.
Through Enriching Women’s Lives they Enrich Families Lives as Well
Mary Kay started the company during the years of the Women`s Movement in the late 1960s. Her goal was to give women the opportunity to move up in the business world and enrich their lives by offering empowerment. This gave their company strength and advantage over other competitors. Women all over the world wanted to become part of this company to become independent beauty consultants and accomplish great things in their lives. Mary Kay now has over 1.7 million independent beauty consultants worldwide, which has attributed to the company’s success.
Highest Paid Commission Sales People in Direct Selling
Mary Kay’s consultants are the highest-paid salespeople in direct selling. This gives them an advantage over their major competitors. The company mostly uses word of mouth for advertising. So they save money and can pay a higher commission to their sales force. Having more consultants means more customers and more customers means more revenue. This allows them to also have incentives and bonuses that drive. Their consultants build loyal relationships with their customers and bring in as many as possible.
Weaknesses
Sells Men’s Products Without Advertising
Mary Kay has a full line of men’s products ranging from fragrances to skin care. Most men wouldn’t know this unless they checked out Mary Kay’s website or if they asked someone who purchases their products. Most men would never think of going to a website with the name Mary Kay. If for some reason they ended up on the website, the first thing they see is Mary Kay’s slogan, “Enriching Women’s Lives”.
Although the meaning of this slogan has nothing to do with the actual products. It is very discouraging if a man were to read it. By only advertising to women and having mostly women as beauty consultants. Mary Kay could potentially be losing half of the market they are trying to reach. When asked Mr. Patrick, the president of Mary Kay Canada, question his response was, “we are looking at improving men’s care line of products over the next 2 – 3 years”.
No Store to Sell Products – Everything is Door-To-Door
The company stands firmly against opening a retail store to sell its products. When asked why during a phone conversation, the president of Mary Kay Canada, Ray Patrick, said “If we are the best selling brand why would we complicate it by selling in stores” and it would “undermine our sales force and their opportunity if we started selling in a retail store”. This could be seen as a weakness but the president doesn’t seem to think so.
With the high demand from retailers and cost of advertising, it would take away from the incentives and bonuses offered to the huge sales force Mary Kay already has. The problem with not having a retail outlet is the possibility of catching the people that are just walking by. If the store is located in a shopping mall, imagine how many possible customers are just walking by on a day out shopping. They could be looking at losing hundreds of thousands of dollars in profit over a year.
Small Size Compared to Competitors
When compared to competitors, such as Avon, Mary Kay is small in terms of revenue. In 2008 Mary Kay’s revenue just exceeded $2.6 billion US. Avon’s revenue for 2008 was more than $10.6 billion US, which is almost five times more. The reason for the big difference in revenue is attributed to Avon’s wide variety of products that spread far from cosmetics. Its small size could make it hard to compete with its competitors.
Opportunities
People are Looking to Start Their Businesses
People around the world are becoming interested in becoming entrepreneurs and starting their businesses. Mary Kay gives people a great opportunity to accomplish just that. There is plenty of room for advancement if that’s what people are looking for. Because of the advancement opportunities, Mary Kay has the potential to grow bigger every year. They already have over 1.7 billion consultants worldwide, and that number is steadily increasing. Since the company is based on direct selling and independent sales consultants. This gives them a huge advantage to steal the market from their competitors.
Selling Products Targeted at the Baby Boomers and Generation Y
Mary Kay sells a wide range of products for consumers of all ages. They sell products to benefit the younger generation and those of the baby boomers. This gives them the potential to grab sales from a huge market known as the baby boomers. Most of the baby boomers are now around the age of sixty and older and may be looking for ways to look young again. Mary Kay’s Timewise collection is a perfect opportunity to place them in this market. The company also sells makeup and other cosmetic products appropriate for today’s generation. So that they can stay in the current market after the baby boomers pass away.
Threats
Little to No Advertising
Mary Kay Inc. has always been focused on the idea of personal selling. The only advertising done by the company would be through their website and the odd celebrity sponsorship. This becomes a threat because their products may not be visible to all demographics. The average person who has not been referred or been told about Mary Kay Cosmetics would have almost no idea the company existed and wouldn’t know about the products they offer.
Intense Competition
The cosmetic industry is a very competitive market worldwide. Mary Kay has to compete with companies such as L’Oreal, Avon, and Estee Lauder to name a few. Most of the competition has their products in retail stores with a huge amount of traffic on a daily bases. Because of Mary Kay’s direct selling approach and the research involved in their product. Their prices are a little higher than most competitors. Price has a huge impact on consumer buying behavior. The constant increase in competition could affect the demand for Mary Kay’s products.
Social Responsibility
As an influential leader in the cosmetics industry, Mary Kay Cosmetics has made social responsibility one of its top priorities. When Mary Kay Ash established her business in 1963, one of the founding principles she based her company on was the importance of giving back to others. Although Mary Kay passed away on November 22, 2001, her legacy and spirit have continued to change the lives of others.
Her life goal of enhancing the lives of women who lacked opportunity, self-esteem, and financial support has been realized and is as concrete today as it was when she first opened her business. Although “enhancing women’s lives” is the company’s mission statement, Mary Kay applied this to her customers and community as well. Mary Kay has been a proud supporter of several different charities, including the Salvation Army, the Red Cross, and the American Cancer Society (Mary Kay Cosmetics).
Mary Kay has its charities as well. “The Mary Kay Charitable Foundation” was founded in 1996 with a mission to “end women’s cancer and domestic abuse” (Mary Kay Cosmetics). In 1997, annual donations were $500 000 and in 2009, rose to $5.8 million (Mary Kay Cosmetics). These funds have gone towards several different things including funding for women’s shelters and community outreach programs for victims of domestic abuse.
In 1989, Mary Kay became one of the first companies in the cosmetics industry to introduce an extensive recycling program. The company has recycled over 300 000 compacts and has reduced its alcohol waste by ten tonnes. Mary Kay was also one of the first companies in the cosmetics industry to produce reusable product packaging. As a testament to their commitment to improving the environment, Mary Kay has collectively planted over 200 000 trees.
CONCLUSION
We recommend that Mary Kay begin looking into their advertising strategy. Direct selling is an important way to build strong relationships with many repeat customers. One problem is that repeat customers only bring in so much revenue each year. Mary Kay’s lack of advertising toward men could be losing them hundreds of thousands of dollars each year. We don’t expect them to change their slogan of ‘Enriching Women’s Lives. Because that would change the basis of Mary Kay’s beliefs when she started the company. We recommend an advertising campaign to increase awareness of the men’s products sold. Mary Kay should continue its direct selling approach without a retail outlet to keep costs down and sales bonuses and incentives up so they don’t undermine their consultants.
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