SUBMITTED BY:

PAYAL MALIK
R. NO. 56
MMS MARKETING A
2
ND
YEAR
INTERNATIONAL BUSINESS
ANALYSIS- M.A.C
COSMETICS
SUBMITTED TO: PROF. KAVITA
KANABAR
Introduction to the World of the Make- up Art Company
MAC cosmetic, Makeup Art Company, is a brand of Estee Lauder and was founded in 1984.
MAC has been abe to ad!ertise itsef uncon!entionay by the company "i!in" away its products
to makeup artists who worked with ceebrities. MAC was in!ented specificay for the achie!ed
ook wanted of fashion modes in certain i"htin" conditions. #his makeup brand is considered to
be $%rand &ositionin" of Makeup for a a"es, a races,' and a skin types. $MAC makeup is
attitudinay hip, artfuy irree!ant, dedicated fuy to the art of sef(decoration and the
reai)ation of the indi!idua.' *n 1994 MAC was the first cosmetics brand to brin" a charity,
which was for A*+,, into the retai en!ironment. #his was the "reat be"innin" to the company
marketin" strate"y, as with the A*+, fund, whene!er anyone bou"ht their -*-A .LAM ipstick,
which first came in a uscious red of representation, they "a!e a of the profits to their charity
which heped ead their saes as we as rose up to /90 miion in charity profit. MAC aso "i!es
out their new products to be re!iewed to 1ou tube makeup "urus and beauty bo""ers. #his keeps
to the traditiona aways(works promotiona strate"y of word(of(mouth ad!ertisement. 2ew
products are "i!en out to be re!iewed e!ery coupe of months, especiay durin" seasons, and
new charity information is promoted at east once e!ery year.
Situation Analysis: Internal Environment
Current Marketing O!ectives" Strategy" and #erformance
#he current marketin" "oas and ob3ecti!es of MAC cosmetics as stated in their 4558 annua
report, is $maintainin" unwa!erin" commitment to brin"in" the best to e!eryone they touch
whie continuay e6pandin" into new re"ions, new distribution channes and new brands.' #he
CE7 of Estee Lauder, owner of MAC cosmetics, Leonard Lauder, states that his company can
and wi be abe to "row e!en durin" these economic troubes with $unparaeed muti(nationa,
muti(channe and muti(brand strate"y8' this meanin" their o!erseas retai estabishments and
onine shoppin". 9iiam Lauder hi"hi"hts the stren"ths that Estee Lauder currenty has, which
is their abiity to isten to their customers as we as their thirty(two thousand dedicated
empoyees. #hese marketin" "oas and ob3ecti!es are consistent with their corporate mission as
they are branchin" out to other sources, such as openin" muti(nationa stores around the word
in order to continuay open up their brand name to new paces and bein" abe to sti make a
comfortabe profit. Estee Lauder as the o!era company aso pans to $capitai)e' it:s stren"ths
by prioriti)e their in!estments, $e6ercise "reater financia discipine', and be"in to $operate in a
more cosey ai"ned manner across the business units and borders.'
Aready noticin" within the year of 4559, this marketin" strate"y has been a success.
$MAC continues to be the eadin" presti"e makeup ine in 2orth America and its "oba net saes
rose by doube di"its,' states 9iiam Lauder. 9ith makeup accountin" for thirty(ei"ht percent of
the net saes for Estee Lauder in the year of 4558, MAC is responsibe for two(thirds of those
saes.
Estee Lauder e6pects to see $doube(di"it "rowth' in %ra)i:s beauty market with MAC
and Cin;ue aone. #he makeup ine has aso raised /<1 miion in their A*+, fund and breast
cancer research charity for the year 4558. Make(up Art Cosmetics has e6panded into =orea and
*ndonesia keepin" to indi!idua retai ocations instead of the traditiona department store. As
with e6pandin", MAC has created specific foundations and bushes that are $carefuy desi"ned
to brin" out the natura beauty in *ndian skin tones.' MAC in *ndia refects the company aidin"
to its *ndian market trend, which is becomin" more tech(sa!!y and ade;uate towards better
;uaity makeup, 3ust as e!erywhere ese "obay. &acin" in second as $American:s Most
Admired Companies' by >orbes, it was a tremendous accompishment for MAC and they intend
to stay in the $tripe bottom ine' for the future. MAC has become more and more "obay aware
to new consumers with their saes constanty boomin" and e6ceptiona marketin" strate"y now
"oin" internationa.
Current and #otential Customers
Make(up Art Cosmetics: demo"raphic is simpe. *t:s for fashion forward women...and
men. *t is tar"etin" toward professiona make(up artists8 howe!er, most of it is sod pubicy so
anyone can buy the products. #here is a MAC &ro coection where ony professiona access is
a!aiabe, but their pubic ine has amost as many coors and toos a!aiabe to work with.
MAC:s purpose is !ery customer oriented and was desi"ned for a a"es, a se6es, and a races.
E!en thou"h MAC does not necessariy ha!e a set demo"raphic, bein" a MAC consumer, * the
a!era"e a"e of their consumer is, in my opinion, between twenty and thirty(se!en. * say this
because * ha!e ne!er seen anyone oder than their ate thirties in a MAC store, then a"ain, *:m
not incudin" the ceebrities or anyone that is famous that has been introduced to the product
before it is sod to the "enera pubic. * ha!e seen e!ery race and "ender in the stores so it pro!es
that their cosmetic coors can work for e!eryone with any skin type and tone. #he ma3or
infuences of me personay buyin" MAC ha!e been word(of(mouth and 1outube make(up "urus.
* ike that * can see what the coors ook ike on and know that there are a ot of peope who ike
the brand as we.
Customer #urchase #atterns and $ehavior
7ne MAC eye shadow is sod e!ery two seconds around the word ?Estee Lauder
Companies, 4558@. 7ne MAC ipstick is sod e!ery four seconds around the word, and ei"hty
percent of women wear it. E!ery time a person "oes into MAC e6pectin" to purchase one item,
they come out with three and spend an a!era"e of forty(fi!e doars. #he a!era"e customer who
shops at Make(up Art Cosmetics makes an a!era"e income of two(hundred and fifty thousand
doars annuay or more. 9ith statistics ike this, MAC must be doin" somethin" ri"ht. About
ei"hty(three percent of peope who come into a MAC store were referred to by a friend. 9hen *
"o into a MAC store for e6ampe, * assume that they ha!e "ood products because * ha!e ony
heard "ood thin"s about them8 howe!er, * want that persona one(on(one time with their beauty
consutants to see what they can do to my face, and too see if * can recreate it. %esides Make(up
Art Cosmetics ha!in" retai ocations word(wide, they aso ha!e an onine store with $i!e chat'
abiity for persona ad!ice. Makeup how(to !ideos ha!e become !ery popuar with cosmetic
companies today, howe!er MAC has been the first of its kind to ha!e the abiity to ha!e an actua
onine con!ersation with a makeup artist. 7nine shoppin" has become e6tremey popuar in
today:s society because it is easier for the consumer to see what the company has to offer in the
pri!acy of their own home, and with today:s society bein" on the mo!e a the time it is a much
faster process. E!en thou"h onine saes are boomin", in my e6perience of istenin" to beauty
1outube bo""ers and readin" onine bo"s about MAC, * ha!e come to notice that a ot of
customers prefer to "o into the store itsef, aone, because of the persona one(on(one contact.
Make(Ap Art Cosmetics is not your typica cosmetic company that has their associates battin"
with their commission "oa and is pressurin" you to buy their product, no, this wi not happen.
MAC:s consutants are paid a hi"h houry wa"e so they can concentrate on their reationship
with the customer and make sure they "i!e e!eryone their own $authentic artistic e6perience.'
#his $authentic e6perience' has ead to Estee Lauder openin" up more freestandin" stores
around the word and heped achie!e that persona pamper time that e!ery women o!es.
Customer Selection and #urchase Criteria
#he difference between MAC make(up and other cosmetic companies "oes as foowsB cruety(
free, a !ery ar"e !ariety of eye shadows and ipsticks, has make foundation shades for e!ery
skin coor, pro!ides ar"e portions of profit to charities, encoura"es recycin" their packa"in" ?so
much so that you can "et a free ipstick, ip "ass, or eye shadow if you brin" in si6 shoppin"
ba"s@, and has e6ceent persona consutin" without the purchase hasse. Many cosmetic
consumers ha!e troube findin" certain shades, whether it is foundation or eye shadow. ,ome
companies do this soey for the purpose of persuadin" their customer to buy two shades to up
their profit. Cowe!er, this does not sit we with most customers8 they want to be abe to know
that they can ha!e one shade that matches their skin tone. 7ther competitors such as 2AD,,
+ior, and Makeup >ore!er ha!e the foundation shades down(pat, howe!er ack in the eye
shadow coection. #he coor seection of MAC:s eye shadows is their stron"est sein" point
because there is so much that a customer can work with. Most cosmetic companies se their eye
shadows in a four coor paette. 2ow, this can be seen as a "reat idea or an irritatin" one. #he
idea of a paette, which usuay comes in four, is so that the customer can see what coors to
coordinate with. Most traditiona makeup companies make eye shadow paettes to coordinate
with the season:s coors, and MAC foowed this trend in the be"innin", howe!er it did not take
into effect !ery on" due to the company sein" sin"e eye shadow pans from the start of the
company. Make(up Art Cosmetics has traditionay sod sin"e eye shadow pans and has had a
ar"e back fifteen eye shadow paette a!aiabe for sae, howe!er ne!er had coordinated paettes
a!aiabe for sae unti recenty. #he "ood thin" about paettes is you can "et four eye shadows
that a coordinate to"ether. #he bad thin" about paettes is that you cannot aways choose
different coors if you wanted toEunti now. 9ith MAC:s new four shadow paettes a!aiabe,
you can buy the four coors a!aiabe or you can choose the four coors you want. Another "reat
thin" about the new four coor paette from MAC is that it ony cost thirty(si6 doars, which is
much cheaper than buyin" them indi!iduay considerin" each eye shadow cost around fourteen
doars apiece. Makeup paettes from +ior cost around si6ty doars which is the cost of a four
eye shadows combined.
#otential Customers and %heir &ack of #urchase $ehavior
#he basic needs of non(customers that MAC:s products and ser!ices do not meet woud
probaby ha!e to be price. ,ome peope 3ust simpy cannot afford their make(up. #here are "ood
dru"store brand cosmetics a!aiabe that they know they can "et for a cheaper price and coud
work 3ust as we. #hrou"h my e6perience, * know that L:7rea:s C.*.& eye shadow coection is
around the same ;uaity as MAC and that they use to cost around nine doars for an eye shadow
duo, howe!er, their marketin" team has reai)ed that their consumers know this and ha!e now
raised their prices to thirteen doars per duo to stay beow MAC:s pricin". &ersona option is up
in the air for "ood ;uaity make(up comparabe to MAC. *t is up to the consumer if they want to
pay for the persona ser!ice of MAC or they want to pay a itte under the same amount for a
somewhat cheaper route.
Situation Analysis: E'ternal Environment
Current Economic Conditions, Le"a, and De"uatory *ssues
9ith Estee Lauder takin" their brands into forei"n countries, this raises the issue of interest rates,
forei"n e6chan"e, and each countries indi!idua issue, such as terrorism and war. *nterest rate
contracts for Estee Lauder in the year of 4558 were thirty(one miion doars. Estee Lauder aso
had one miion doars to put towards currency forward contracts in which Euro:s were the most
e6pensi!e. Conse;uences that pose a threat to openin" up stores in the Midde East are $terrorist
attacks, retaiation, and the threat of further attacks or retaiation.' Cowe!er, accordin" to Estee
Lauders 4558 fisca annua report, saes were up by twenty(two percent throu"hout the Midde
East and amost haf of their net saes came from forei"n countries. #his increase in profit is
possiby due to the peope wantin" and bein" abe to ha!e their own persona pamperin". Aso
considerin" this increase in saes, the consumers of Make(up Art Cosmetics seem ha!e a !ery
optimistic opinion of the economy in its current condition and with this MAC has sti been
"rowin" financiay and re"ionay.
%echnological Advancements of Importance
9ith MAC ha!e tremendous success with their word(of(mouth strate"y8 boostin" their onine
en!ironment wi hep their saes si"nificanty. Accordin" to a study by Mc=insey F Co. GHupiter
Media Metri6 that was pubished in %a)aar-oice *ndustry ,tatistics, $users who contribute
product re!iews or post messa"es !isit sites nine times as often as non(contributors do.
Contributors aso make purchases neary twice as often.' 9ith more brand reco"nition MAC
coud ha!e more of a positi!e name and more abiity to ha!e a ar"er ran"e of free standin"
stores. ,ince MAC is aready known widey by word(of(mouth, addin" more onine
concentration wi be !ery beneficia for the promotiona aspects of the company. Ca!in" more
onine shoppin" a!aiabe, this wi mean more ad!ertisin" e6penses8 howe!er that shoud be an
in!estment that Make(up Art Cosmetics can make.
(IS%O)*
MAC Cosmetics, Makeup Artist Cosmetics, was founded in #oronto, 7ntario, Canada by >rank
#oskan and >rank An"eo in 1984 with the assistance of chemist -ic Casae. #he first A., MAC
store opened in 1991, in 2ew 1ork.
#he companyIs products were initiay specificay desi"ned for professiona make(up artists but
are now sod to consumers wordwide. Lon" before their company history, MAC cosmetics
founders directed their product ine towards professionas in the beauty and fashion industry who
had to rey on hea!y cosmetics, cake makeup, and sta"e makeup to create the !isua effects
needed to withstand bri"ht i"htin" durin" photo shoots. MAC cosmetics can be found
at department stores wordwide such as %ek,2ordstrom, MacyIs and +iardIs, as we as MAC
,tores. 2ordstrom was the first department store in the Anited ,tates to se the product
e6cusi!ey and was si"nificant in hepin" the company estabish a resoundin" financia success
in the A,. After a four year contract was up, MAC be"an e6pandin" to other retai stores and
!i"orousy be"an openin" industry stores.
EstJe Lauder Companies ac;uired a controin" interest in MAC in 199K, then competed their
ac;uisition of the company in 1998. 7ri"ina founder >rank An"eo died in 199L due to
compications durin" sur"ery.
MISSIO+
$A Daces, A ,e6es, A A"es' concei!ed to embrace a consumers. #o be the words eadin"
make(up authority amon" both professiona make(up artists and consumers. #o meet customers
need for superior ;uaity ser!ices and to pro!ide secure F chaen"in" work en!ironment for a
empoyees. As an or"ani)ation it commits itsef to hi"h standards and creati!e de!eopment with
an enterprise concept that a pains ha!e "ains.
,ISIO+
MAC cosmetics were founded with a creati!e !ision to fi the "ap between makeup artistry and
fashion photo"raphy. Lon" before their company history, MAC cosmetics founders directed their
product ine towards professionas in the beauty and fashion industry who had to rey on hea!y
cosmetics, cake makeup and sta"e makeup to create the !isua effects needed to withstand bri"ht
i"htin" durin" photo shoots
-O.) #/s O- I+%E)+A%IO+A& MA)0E%I+1
#)O2.C%S
MAC pro!ides a wide !ariety of products for the e!eryday consumer

such as eye shadows,
ipsticks, ip("oss, a types of foundations, conceaer, nai poish, sta"e makeup, and mascara.
Amon" a of these make(up products, MAC aso ses fra"rances, make(up brushes, and skin
care products
7n Hanuary 8, 4511, 9arner %ros. Consumer &roducts announced that +C ComicsI fictiona
heroine 9onder 9oman woud team up with MAC Cosmetics to create a 9onder 9oman
makeup coection that woud be a!aiabe in MAC stores in the sprin" of 4511. #he coection
incuded bush, eye shadow, eyeiner, ip "oss, ipstick, mascara, minera powder and nai poish.
Most MAC products are oi free. ,ome MAC products do contain natura ois which function
as emoients ?for e6ampeB oran"e oi, 3o3oba oi@.
MAC #)O
#he MAC &D7 &ro"ram is a!aiabe to cosmetic professionas. A MAC &D7 membership
appication is re;uired aon" with two forms of professiona identification. #he appication is
maied and appro!ed by a MAC &D7 representati!e. Cosmetic professionas and students who
"raduate from MAC &ro preferred schoos recei!e discounts on purchases.
#)OMO%IO+
M.A.C Cosmetics markets its "oods and ser!ices to both indi!iduas and or"ani)ations. *n the
eary de!eopment of the company M.A.C make(up was made purposey for professiona
makeup artists to with(stand ri"orous wear of make(up for modes durin" photo(shoot and
fashion shows. 2ow M.A.C markets to women of a a"es and ethnicities. Athou"h M.A.C
Cosmetics trade in the niche market where its tar"et market is ony femae.
SA&ES #)OMO%IO+
#ersonal Selling:
&ersona sein" is one of the odest forms of promotion. M.A.C Cosmetics foows this
strate"y and stands out as the wordIs ar"est make up company.
Advertising:
M.A.C. Cosmetics was initiay distributed amon" friends ony in the fashion industry
and ti today M.A.C. does not e!er ha!e to conduct any kind of ad!ertisin". #his is a
credited to word of mouth pubicity and ceebrity endorsements, which usuay incudes
modes, pro make(up artists and actresses.
Advertising ,iva 1lam
M.A.C uses ceebrities such as 2icki Mina3, Dicky Martin and Lady .a"a to
promote -i!a .am product ine.
#&ACE
Mac cosmetics uses e6cusi!e retai outet pace to se their product rather than choosin"
another distribution channe.
#)ICE
COM#E%I%I,E A+A&*SIS
MAC cosmetics are owned by parent company EstJe Lauder and competes directy with L:7rJa
brands Maybeine and De!on in the Canadian cosmetic industry. L:7rJa currenty hods the top
spot in cosmetics. De!on is another competitor in cosmetics.
De!on products are sod at competiti!e prices whie MAC is sod at !aue based prices.
Lorea and De!ons: ori"ina products are a!aiabe in oca market but ori"ina M.A.C:s products
are not a!aiabe. Compare to MAC products the prices of Lorea and De!on are much cheaper
and thus a!aiabe to the common peope, %ut howe!er how much costy the MAC products
may be but ;uaity of MAC products are much better than Lorea and De!on
SOCIA& )ES#O+SI$I&I%IES
MAC has fi!e socia initiati!e pro"rams currenty in pace
MAC Cruety(>ree %eautyB MAC formery "uaranteed that no anima testin" was
performed by them or their suppiers, howe!er MAC no on"er "uarantees its products are
cruety free. Current poicy is that M7ur products are not tested on animas e6cept when
absoutey mandated by aw'.
%ack 4 MAC Decycin"B offers free ip"oss, eyeshadow, or ipstick at any MAC ocation
?ipsticks ony at MAC counters in department stores@ with the return of si6 empty MAC
containers. #he ony items that can be obtained free throu"h %ack 4 MAC are ori"ina
Lip"ass ?e6cudin"B Lustre"ass, &ush"ass, Cremesheen .ass, &ro Lon"wear Lip"ass and
+a))e"ass@, sin"e ?non(refi, sma(si)e@ eyeshadows ?e6cudin" &ro Lon"wear,
Minerai)e, and &ressed &i"ments@, and ipstick in the ori"ina back and si!er buet
packa"in". -i!a .am, Minerai)e, ,heen ,upreme, and &ro Lon"wear ipsticks, as we as
ipsticks in specia decoration packa"in", are e6cuded.
MAC =ids Cepin" =idsB started in 1994 where kids affected or infected
by C*-GA*+, create ima"es that are reproduced as "reetin" cards. 155N of sein" price
"oes back to participatin" or"ani)ations.
#he MAC A*+, >undB
O9P
supports community or"ani)ations pro!idin" direct ser!ices to
men, women and chidren affected or infected by C*-GA*+,. #o date the foundation has
raised o!er /490,555,555 usd since its inception in 1994.
MAC -i!a .amB 155N of the purchase price of any -i!a .am product ?ipsticks,
ip"asses and hoiday sets@ "oes to the MAC Aids >und. Mutipe Ceebrities ha!e endorsed
the MAC -i!a .am products, such asB Du&au, Lady .a"a, Cyndi Lauper, Eton Hohn, 2icki
Mina3, Christina A"uiera, Dihanna, %oy .eor"e, Dicky Martin, +ita -on #eese, ,hirey
Manson, Mary H. %i"e and more.
Controversy
MAC was the center of contro!ersy when pubic offense arose o!er the anticipated ,eptember
4515 reease of the MAC Dodarte coection, a coaborati!e effort with the fashion
abe Dodarte. #he coection was based on the border town of Huare)

in which at east 455
women ha!e been kied in bruta sayin"s. MAC e!entuay pued the ine before distribution,
and instead set up /155,555 in a charity. #he charity has currenty raised o!er < miion doars in
4 years.
S(I##I+1
A orders are processed and shipped on business days ony, Monday throu"h >riday, e6cudin"
ma3or hoidays.
7rders paced on ,aturday and ,unday wi be processed on the foowin" business day.
,hippin" char"es start at /0.55 and increase with the !aue of your order. #he order !aue is the
subtota of customer:s order not incudin" ta6 or "ift wrap char"es.
*f the order ony contains MQAQC .ift Cards, customer wi be char"ed /0.55 for ,tandard
,hippin".
#he order tota used to cacuate ,hippin" and Candin" fees wi not incude the !aue of the
purchase of MQAQC .ift Cards or e.ift Cards.
R 4nd +ay orders wi be processed the same day the order is paced if one:s order is recei!ed by
<B55 pm E,#. 7rders recei!ed after <B55 pm E,# wi be processed on the ne6t business day. 4nd
+ay orders may re;uire a si"nature upon dei!ery.
RR 7!erni"ht orders wi be processed the same day the order is paced if the order is recei!ed by
<B55 pm E,#. 7rders recei!ed after <B55 pm E,# wi be processed on the ne6t business day.
7!erni"ht orders may re;uire a si"nature upon dei!ery.
M.A.C currenty ships to the foowin" A&7 G >&7 ocationsB
AA ( Armed >orces Americas
AE ( Armed >orces Europe
A& ( Armed >orces &acific
M.A.C currenty ships to the foowin" A.,. #erritoriesB
.A ( .uam
M& ( 2orthern Mariana *sands
-* ( -ir"in *sands
>M ( >ederated ,tates 7f Micronesia
MC ( Marsha *sands
&9 ( &aau
A, ( American ,amoa
&D ( &uerto Dico
Most items may be shipped to Aaska, Cawaii and the A.,. #erritories, but some restrictions
appy.
S(I#ME+%S %O I+%E)+A%IO+A& A22)ESSES
#hey currenty unabe to accept orders bied or shipped to destinations outside of the Anited
,tates.
&ease note, many MQAQC Cosmetics counters internationay wi process phone orders.
Complimentary Shipping
9hen pacin" an order, we make it easier with compimentary shippin". &urchase /105 ?after
discount@ of MQAQC products and we wi ship free of char"e by courier ?re"uar "round
shippin"@ within the A, and Canada. ,ome restrictions appy. Limit fi!e compimentary
shipments per year, per member.
$.SI+ESS #&A+
M.A.C cosmetics has a cear business ob3ecti!e to promote Make(up products and ser!ices.
#hese products and ser!ices ha!e been de!eoped o!er <5 years with a core focus on addressin"
the key customer probem and associated opportunities.
%he $usiness O!ectives
9hen as a key component of our "rowth strate"y we consider it critica to identify and outine
our business ob3ecti!es, and ai"n these ob3ecti!es with cear and measurabe de!eopment
miestones. 7ur key on" term business ob3ecti!e is to "row re!enue. Dapid re!enue "rowth is
considered the most critica and measurabe business "oa. At this sta"e of our de!eopment, we
consider this to be more important than profitabiity "rowth, athou"h both are important on"
term ob3ecti!es.
%he Customer
M.A.C cosmetics has been created with a cear focus on the needs of our customers. #hrou"h a
structured customer disco!ery process, we ha!e !aidated the key customer probem as #he need
for professiona makeup. #his is a critica issue for our seected tar"et market of Ci"h schoo
students.
%he ,alue #roposition
M.A.C cosmetics are uni;uey positioned to dei!er !aue to Ci"h schoo students. MMac
cosmetics wi Suick trendy poished makeup. *n order to be dei!erin" on this !aue proposition,
we are the makeup authority.' #his capabiity has taken considerabe time and resources to
de!eop and forms the cornerstone of our competiti!e ad!anta"e.
Competitors
#hey ha!e a number of competitors within the Make(up market. 9e consider our key
competitors to beB ,ephora. 7ur understandin" of these competitors has been used to refine our
strate"y and !aue proposition. 9e beie!e that we can compete effecti!ey with ,ephora by Ap
to date trend makeup.
0ey Strategies
7!er the ne6t K months our focus wi be to %uid successfu e!ents to create re!enue. #his task
wi be undertaken in the conte6t of our broader strate"y to &an after hours e!ents . #hese
strate"ies are a tactica impementation of our o!era business "oa as outined abo!e.
Milestones
Measurement of the successfu impementation of our strate"ies wi be "o!erned by measurabe
de!eopment miestones. #he miestones that wi be achie!ed o!er the ne6t 4 years areB 7btain
155 customers Deturn for future e!ents %uid cient profies
LA#E,# 2E9,T
*n the recent years, MAC has sowed down its spreadin" out around Europe and does not intend
any sae strate"y chan"es or new retai sae contracts. ,ince there is no onine sae throu"h
*nternet outside the Anited ,tates, Centra and East Europeans ha!e no possibiity to buy the
MAC cosmetics e6cept tra!ein" for it abroad. Additionay, weak promotion causes awareness
decine and ower saes for the ast fisca year. #he company uses ceebrities ?actress, sin"ers@ as
representati!es or modes for MAU cosmetics. Cowe!er, there is ack of ad!ertisements and
promotiona campai"ns that woud attract ordinary women to try the brand make(up.
Hustification for the probem:s causes
Decent sow e6pansion of the company is caused mainy by the imited ways of sae and by the
worries about the oss of contro in the case of penetratin" new markets. #he company does not
think about any other practices than retai contract saes and refuse the offers from abroad to "et
MAC products in there. $#he demand for MAC Cosmetics is there, but the suppy is not. 9hie
MAC is one the cosmetic ines hi"hest in demand, findin" discounted products is actuay not
that easy' ?-asen, 455L, p. 1 @ Moreo!er, there are no media ad!ertisement outside the Anited
,tates and peope often do not e!en know about the products and their ad!anta"es. #he statistics
show that the eadin" way to "et information about MAC products is !ia referras ?%ates, 455K,
p. 4@. ,ince there is a ack of promotiona campai"ns with no free sampes, the company can ony
rey on the e6istin" customers to spread the information about MAC products.
Aternati!e soutions
#here are se!era aternati!es how MAC can penetrate new markets, mainy Centra and East
Europe and aso how to make peope more aware of its hi"h(;uaity cosmetics. *t is "ood to
consider different ways of the sae strate"y, such as e6portin", franchisin", or retai sae !ia
contracted distributors.
>irst aternati!e that can hep the company to "et its products further abroad is e6portin".
E6portin" can be performed by the company itsef or it is sometimes "ood to use e6port a"ents
that work as intermediaries between the company:s home country and the forei"n country ?or
e!en more forei"n countries@ to which the company wants to e6port its products. #he foowin"
SWO% Analysis for E'porting
,tren"ths 9eaknesses
Deachin" new markets hi"h initia and administrati!e e6penses
Low fi6ed costs ad3ustments
Ci"her re!enues formaities
Corporate "rowth distributor contracts
7pportunities #hreats
*nno!ation tou"h competition
"oba e6pansion poitica and economica impediments
internationa awareness of the brand
MAC can benefit from e6portin" because of "ettin" its products e!erywhere at reati!ey ow
costs. #he products can be distributed by e6terna intermediaries and se at the wordwide
markets without any direct in!o!ement of the company. Cowe!er, it re;uires se!era
ad3ustments of the products to be made by the company itsef, such as packa"in", and some other
modifications that woud suit to different nations. Aso, there can be some administrati!e
obstaces that the company has to so!e in order to make "ood a"reements with the distributors.
7n the other hand, e6portin" can pro!ide internationa awareness of the brand connected with
the desire to inno!ate e!en more. #he threats that can occur in the case of e6portin" can actuay
occur aso in other ways of marketin" practices, that is tou"h competition or poitica and
economica impediments that make the product offerin" harder and more costy ?Ad!anta"es F
disad!anta"es..., 455L, p. 1@.
,econd aternati!e in order to reach new markets is franchisin". >ranchisin" is one of the most
widespread forms of cooperation between companies a around the word. A franchisor is the
founder of the whoe system and represents a core for the whoe network of franchisees. #he
parent company de!eops and mana"es the conditions at which the franchisees function and
actuay ses its business ob3ecti!e. *n the chain of franchisees, each one is an independent
business unit but its operation is partiay controed and imited by the parent company:s
marketin" conception. #herefore, franchisin" pro!ide both ad!anta"es and disad!anta"es for the
franchisor as we as for a franchisee.
SWO% Analysis for -ranchising
,tren"ths 9eaknesses
money infow hi"h marketin" costs
new market penetration ower fe6ibiity
cooperation with oca peope personne trainin"
7pportunities #hreats
creati!ity possibe oss of contro
"oba e6pansion cutura differences
internationa awareness of the brand worsenin" reputation
7ne of the "reatest ad!anta"es of franchisin" is money infow from the franchisees, which pay
for the ri"ht to se the MAC products, for the brand name, and know(how. %eside that, the
company can rey on the oca peope that know the oca market and can appy or ad3ust the
ori"ina marketin" strate"ies directy to the oca customers. #hat can brin" new inno!ati!e ideas
and su""estions for modification in order to fit the products to the oca market. Cowe!er, there
is a possibiity of faiin" in the case of appication the strate"ies that arose somewhere ese in the
word. #here can be present ow fe6ibiity whie communicatin" on the on" distances and aso
hi"her initia cost for trainin" the empoyees and make them do what the parent company wants.
*f the oca company does not fufi the re;uirements setted in the franchisin" a"reement, it can
threaten the company:s reputation e!en on the internationa e!e. Aso, it is ine!itabe to
consider the cutura differences and ad3ust the products as much as possibe to those different
needs and habits.
#hird aternati!e is to stay with the actua system, so to distribute the products !ia contracted
internationa perfumeries or own stores mana"ed from the centra office, but brin" a new
promotiona strate"y that can aso hep to penetrate new markets and aso increase saes in the
e6istin" markets.
SWO% Analysis for International #romotional Strategy
,tren"ths 9eaknesses
pubic awareness hi"h cost for ad!ertisin"
hi"her re!enues and saes +i!ersity
stabe business contro
7pportunities #hreats
new markets "rowin" competition
"oba promotiona campai"ns pubic "ut for ad!ertisements
#he new promotiona strate"ies can pro!ide not ony reachin" new markets and spreadin" out the
awareness of the MAC products but aso it can si"nificanty hep to increase saes and re!enues.
,ince the stores are the company:s ownership, and aso most of the empoyees or at east branch
mana"ers are directy from the centra office, there is a hu"e contro of prescribed marketin"
practices and not much space to break the re"uations. Decenty, ad!ertisin" is an ine!itabe part
of sae and do the promotion ony throu"h ceebrities and modes is not enou"h. &eope cannot
know much about the product ;uaity without interacti!e campai"ns and free sampes that they
can try and make their own opinion about MAC cosmetics. 2o doubt, ad!ertisin" is not a cheap
matter and carefu bud"et pannin" is ine!itabe but the costs can be paid back soon by the
increased saes. 7f course, "rowin" competition or pubic "ut for ad!ertisements can threaten
the saes and the company:s success but it woud be pointed on the whoe market, not 3ust one
sin"e company.
)ecommended solution to improve sales 3orld3ide
>irst of a, the company shoud $determine the tar"et audience' in order to know how to focus
the promotions ?C)inkota F Donkainen, 4554, p. 0<8@. Athou"h MACVs motto is $A races, a
se6es, a a"es', it woud be better to focus the promotions to women, especiay youn"er women
who can be the ar"est "roup of potentia customers ?MAC, 455L, p. 1@. Aso, youn" and midde(
a"ed women more incined toward different coors and are ikey to e6perience new te6tures and
o!era makeup. ,econd, it is needed to $determine campai"n ob3ecti!es', so to make a research
about the oca market and sette the "oas that shoud be fufied by the campai"ns ?C)inkota F
Donkainen, 4554, p. 045@. #he e6tent of the campai"n is aso determined and is infuenced by the
bud"et amount, so how much financia resources can be used for the promotions. *t must be
carefuy panned and ad3usted to the company:s abiities. *n the case of cosmetics, the best
$media strate"y' is to or"ani)e interacti!e meetin"s, workshops, and free sampes distribution
?C)inkota F Donkainen, 4554, p. 041@. 9omen can try the products by themse!es and find out
their hi"h ;uaity. Aso, ad!ertisements in the femae ma"a)ines are a "ood way to make women
aware of the MAC brand. *t is a we(known fact that women are wiin" to pay ar"e amount of
money for cosmetics if it is worth, so e!en the hi"her prices of MAC cosmetics are not an
obstace in increasin" saes and attractin" new customers. MAC shoud use some successfu
promotiona a"ency for the campai"n conduct. #he a"encies ha!e the e6periences and skis to
prepare a hi"h(;uaity campai"n e!en on the internationa e!e. #he company itsef woud not be
abe to mana"e a the important thin"s that an internationa promotiona campai"n re;uires. #he
financia resources in!ested to the campai"n can be ;uicky returned by hi"her saes and more
customers attracted by the promotion.
E,A&.A%IO+
,uccess of the new promotiona strate"y can be measured by se!era techni;ues. >or e6ampe,
$pre(testin" of copy appea and brand reco"nition, post(testin" of product or brand reco"nition,
and measurin" campai"n:s impact on saes' ?C)inkota F Donkainen, 4554, p. 008@. *t is a !ery
"ood measurement to compare the saes before and after the new strate"y appication.
Additionay, increasin" saes and increasin" number of re"uar customers are "ood si"ns of the
successfu campai"n. &ubic awareness of the MAC products can be aso measured by the
;uestionnaires and randomy asked ;uestions in the streets or beauty saons. &ropery panned
and conducted promotiona campai"n wi certainy hep the company to "et to the European
markets and increase pubic awareness of the MAC products.
-I,E -O)CES A+A&*SIS
1&O$A&
MA)0E% ,A&.E
MA)0E% A+A&*SIS
COM#E%I%O) A+A&*SIS
C(A++E& #E)-O)MA+CE
-I+A+CIA& A+A&*SIS
$I$&IO1)A#(*
%aentine, ,. ?4559, Huy 44@. -ain .orous, Dichard &hiips for MAC . # Ma"a)ine .
%a))ar-oice. ?4558@. *ndustry ,tatistics. Detrie!ed ,eptember 10, 4559, from
%a))ar-oiceB httpBGGwww.ba)aar!oice.comGresourcesGstats
%ri"hton, .. ?455K, March K@. MACIs Caime to >ame. &,>= .
Estee Lauder Companies. ?n.d.@. MAC. Detrie!ed ,eptember 10, 4559, from Estee
LauderB httpBGGwww.ecompanies.comGourWbrandsGourWbrands.asp
Estee Lauder Company. ?4558@. #he Estee Lauder Companies 4558 Anua Deport. 2ew
1ork.
Ca, C. A. ?4559@. %uyin" %eauty. 9omenIs 9ear +aiy .
Cudson, &. ?4558@. #he Mirror. Cate to be A +ra" MAC, %ut... , >EA#ADE, p".<4.
marketin"dope. ?455L, 2o!ember 9@. #he MAC Cosmetic ,tory. Detrie!ed ,eptember
10, 4559, from -ira Marketin"B httpBGGmarketin"dope.bo"spot.comG455LG11Gmac(
cosmetics(story.htm
,aks, +. ?455L, +ecember 19@. MAC Cosmetics. Mansueto -entures LLC .
9ison, E. ?4559, Huy 44@. MAC &itchin" *ts >ashion #ent +owntown. 21 #imes .