Where Does It Hurt?


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Published in GCI Magazine, January 2010

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Where Does It Hurt?

  1. 1. MARKETING n BY ALISA MARIE BEYERMATTERSWhere Does It Hurt?An exclusive study takes a look at the top concerns of today’s leading beauty executives.W ith reports that the value of the beauty market sank in 2009, it’s no surprise that industry executives are An in-depth analysis of what wentcasting their eyes to the future. Deciding howto grow a company in a changing economy wrong and what wasn’t embracedinvolves creative thinking, strategic planningand a little bit of moxie to come out on top by your consumer is the necessarywhen the dust settles. What worked a yearor two ago to get her into your store or using first-step toward finding the missingyour brand isn’t necessarily going to compeltoday’s consumer, as the sad demise of both link and creating a multichannelPrescriptives and Max Factor illustrates.And although consumers continue to spend platform that will be successful.a bit more money on personal care items ingeneral, they have scaled back on spending,period. Accordingly, beauty brands need to across the board. What’s the next big idea? this missed opportunity, how to keep what isadapt and implement strategic campaigns How can social networking be leveraged currently working for them working and tothat reach across ever broader platforms. to grow market share? And how can their retain current consumer loyalty. Fi y-four Like you, e Benchmarking Company brands gain her loyalty and trust? Beauty percent of executives listed “knowing morewanted to know how these changes are executives are always saying they want about how frequently she is purchasing theira ecting the industry, so it asked more than to reach “nirvana” with their brand: that brand” as one of their top 10 most important130 beauty executives—founders, CEOs, untapped distribution channel or that one research concerns, which directly links to whypresidents, senior vice presidents, marketing amazing product that would put them closer she may have rejected a certain channel.directors and managers—to take a survey and to solving all their business concerns, but An in-depth analysis of what went wrongshare their thoughts on their biggest research, the survey clearly revealed that regardless and what wasn’t embraced by your consumerstrategy and branding concerns. Every sector of how it might appear, there is no nirvana. is the necessary rst-step toward nding theof the industry is represented. Top 20 brands, Every channel struggles with the same missing link and creating a multichannelprestige, mass, home shopping, infomercial, questions, every brand faces the same platform that will be successful.and small entrepreneurial indie brands all concerns and the industry as a whole is onchimed in: Estée Lauder, SkinCeuticals, the same page about how to meet the futureJohnson & Johnson, April Rain, Chanel, Audit Her Medicine Cabinet of beauty.Alchimie Forever, Besame Cosmetics, MaryKay, Remede, Fusion Labs, Yes to Carrots, Getting back to basics and looking insideGuthy-Renker, L’Oréal, Avon, Matrix, ree Just the Facts her medicine cabinet, purse and makeupCustom Color, Coty, Joico, Molton Brown bag are also important research areas forand dozens of others provided input on the Knowing why consumers rejected certain executives. Of research services purchasedbiggest business and branding concerns in the retail channels was the number one research for their companies, 25% were brand trackingbeauty biz. All responses were anonymous concern for all executives; more than and consumer insight studies, and a full 26%and con dential. 67% listed it as their primary focus. With of that research was used for new product So, what did they have to say? e survey such abundant retail channels available to visibility. What is her current routine? Whatrevealed that no matter what brand the consumers today, it is critical for executives are her attitudes toward beauty products inexecutives worked for or what channel and companies to know what didn’t work in general and how do they earn a place in herthey worked in, concerns were consistent order to understand how they can capture daily regimen?24 Marketing Matters GCI January 2010
  2. 2. By leveraging what you know about yourconsumer’s beauty routine now againstwhat you can give her in the future, youposition your brand to ll a void that she By leveraging what you knowmay not yet even know exists. It’s no secretthat consumers are trading both up and about your consumer’s beautydown these days when shopping. Brandname items are replacing certain expensive routine now against what you candesigner brands in order to allow consumersto continue to a ord that Chanel compactor Gucci fragrance. Focusing on what she is give her in the future, you positionusing, and continues to a ord in spite of theeconomy, will let you tailor your o ering in a your brand to fill a void.way that will both meet her needs, as well asallow for innovation. by October 2009—all during a time of ve years? Will she still be trading up andThe ‘It’ Hit recession. Neutrogena didn’t re-invent the down for the same items? wheel with this product (it is an acne line With 26% of research dollars spent onWith more than 50% of respondents ranking made with ingredients typically found in focus groups, many executives seem to agree.new product concepts as their biggest other acne products); instead, Neutrogena By utilizing complementary business tactics,strategy concern, it’s clear that merely having cleverly capitalized on how its consumer such as social networking or alternative retailgood ideas for your brand isn’t enough— wants to and is shopping, and embraced a channels, and accessing target consumers’product concepts need to communicate new “it”—an online only distribution model brains with focus groups and outreachthat unseeable, oh-so-sexy “it” factor and with a personalized twist. studies, your brand can get a pulse on whatanticipate what consumers are going to Don’t re-invent the wheel; instead, give consumers want in order to generate conceptswant. But how does this translate in an consumers the innovation they can’t live that will win her.economy where tried-and-true brands, once without.on the cutting-edge of trendy, are now gone?Even when brands take steps to nd these It’s Still Who You Knowanswers—trend reports are the top research A Wrinkle in Timeservice purchased (36%)—answers aren’t It has been estimated that more than threealways forthcoming. As Jeremy Gutsche, Product concepting was another big strategy million messages are tweeted on Twitterauthor of Exploiting Chaos: 150 Ways to problem for executives, and more than everyday. Imagine if just a third of thoseSpark Innovation During Times of Change, 57% declared “knowing product concepts messages mentioned your brand. A half?notes, “ e upbeat impact of crisis is that for the next ve years” as a top concern. Factor in Facebook, MySpace, YouTube,competitors become mediocre, and the In any economy, long-term plans for new MySocial 24x7, FriendFeed, Blogger, Tumblr,ambitious nd ways to grow.” concepts are obviously important. But in LinkedIn and any one of the dozens of other To illustrate, Neutrogena only just today’s economy, envisioning what those rapidly evolving social media outlets and it’slaunched the SkinID brand in 2009, concepts might be for a consumer who is clear to see the potential to reach untappedhowever; the line had already taken a reinventing how she shops is a tall order. consumers through social networking islarge portion of the online acne business What economies of scale will be in play in enormous. Of companies that purchasedwww.GCImagazine.com Marketing Matters 25
  3. 3. MARKETINGMATTERSbrand development services, 68% of serviceswere Web collateral and design combined.Clearly, social media is here to stay, andsmart brands are eager and ready to explore If you give your consumer what shethis channel. Where online marketing might have been wants before she’s had a chancean option two years ago, today it’s a necessity,and 52% of executives agree that a powerful to look elsewhere for it, you willonline presence is key to building an evenmore successful brand. In fact, social media keep your brand fresh in her mind.plans and online networking are the thirdbiggest strategy question for executives. Luckily, it is a question that can beanswered with relative ease and almostlimitless creativity. Tap into (or create) to look elsewhere for it, you will keep your With so many brands available to them,an online community that targets your brand fresh in her mind, and on her lips. consumers are seeking results as theirdemographic, create interactive and engaging ultimate litmus test, and they want to feel anfan pages, and host customer appreciation emotional attachment to their products. Wecampaigns or contests on your company’s How Do I Trust Thee? are nally seeing sales driven click by click. Ifhome page—and you can reach a vast you build that foundation, they will come.consumer segment. Not only are consumers Executives are concerned with brand loyaltybecoming accustomed to getting real-time and trust factors, and 23% of executives have or would purchase consumer awarenessnews and information via these channels, it is research to help map out this process. Who A Rose by Any Other Namerapidly becoming their preferred method ofcommunication. If you give your consumer earns her loyalty? How do you gain (and Knowing what she thinks of your brand inwhat she wants before she’s had a chance keep) her trust in your brand? relation to others is the sweet spot all marketers Figuring out the answer to want to own, yet for 53% of executives, it’s the this formula is a bit like solving a number one branding problem. More than just Rubik’s cube: there are many ways testing advertising or teasing out messaging, WHO PARTICIPATED IN THE to approach the solution, and, discerning intimately how your brand although it may not seem so, the compares to others in target consumers’ minds EXECUTIVE SURVEY? solution is quite possible. e most illuminates white space and opportunity. Most important factors are that your 52% Brand Owners products connect to her emotionally marketers agree, it’s not the rst purchase that counts but rather the lifetime value of 13% Vendors and Consultants while also di erentiating your continued purchases that matter. brand from competitors seeking to If you had a crystal ball and it could tell 8% Retailers do the same thing: claim her loyalty. you exactly what she was thinking when 4% Beauty Associations For example, does your lip plumper she held your product in her le hand, and really plump her lips or does it your competitor’s product in her right, 2% Magazines and Publications work just like every other lip gloss wouldn’t you want that information? Today, on the market? you are closer to bridging this gap than26 Marketing Matters GCI January 2010
  4. 4. TOP BRANDING CONCERNS FOR BEAUTY EXECUTIVES Knowing how my brand compares to others in her eyes: 53% Connecting on an emotional level /differentiating my brand: 49% Finding my brand’s real ownable position: 47% Telling her my brand story more effectively: 46% Refreshing my brand/product offering: 34% TOP RESEARCH CONCERNS FOR BEAUTY EXECUTIVES Which retail channels were rejected and why: 67% Brand loyalty and trust factors: 66% Her perception of my brand: 63% Her attitudes about beauty: 63% Her beauty routine and habits: 62% Sources and publications she uses for beauty knowledge: 61%ever before. Social media sites allow you rather only certain areas needed attention—to communicate with your consumers in not the entire brand, which is a good sign.real-time, and online tra c metrics can give e industry has recognized that a newyou deep insights into how your consumers consumer has emerged, and rather thanare navigating the Internet (including fragmenting, the industry is instead rallyingcompetitor’s sites), virtually allowing you to behind this new metric synergistically toread her mind. meet her needs and lay the foundation for continued future growth. O en, the industry studies consumerWhat’s Next? preference for brands, however, with 85% of purchases still made at the store level, theAs executives brainstorm next steps in focus should shi to getting more insightsthis economy, some ideas simply didn’t on the shopper. She is still going to the storeresonate. Traditional outlets for reaching and mentally comparing your brand o eringthe consumer, such as print collateral to the one next to it, or the one that shecampaigns took a backseat in magnitude to currently has in her mind. n GCIcreating robust social marketing platformsor funding research into the next “big thing.”Ditto for training expenses and launchplans, which ranked at the bottom (14% and ALISA MARIE BEYER is the founder8% respectively) for brand marketing service and creative director of The Benchmarkingneeds. Importantly, executives overall still Company (TBC), a global beauty consultinghave con dence in their brands and in firm offering business, strategy, consumertheir brand’s ability to meet all of these intelligence and branding. As publishers of the “must read” Pink Report and WomenTrends,new challenges. In fact, more than 54% of TBC keeps its fingers on the pulse of the industry and offersexecutives were so con dent in their brands unparalleled consumer insights and intelligence.they felt a total brand audit was unnecessary, E-mail: alisa@benchmarkingco.com; www.benchmarkingco.comwww.GCImagazine.com Marketing Matters 27