Target Market 8 Social Media Promotion Assignment

MARKETING

Table of Content
Part 1- Introduction- About MAC cosmetic..............................Page 2
Part 2- Environment Analysis ............................................. Page 2
Part 2.1 General Macro External Environment...........................Page 2
Part 2.2 General Micro External Environment............................Page 4
Part 2.3 Stakeholder Analysis................................................Page 5
Part 3 Segmentation, Targeting, Positioning..............................Page 6
Part 4 Marketing Mix..........................................................Page 7
Part 5 Recommendations.....................................................Page 8
Part 6 Gibbs Reflection ......................................................Page 10
Part 6 References..............................................................Page 12
Part 7 Appendices ............................................................Page 21
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Part 1- Introduction – About MAC Cosmetic
MAC cosmetic was founded by two male artists in Toronto, the brand has now established
for 38 years since 1984 (MAC Cosmetics, 2019) and consider as No 1 among the other 19
competitors including NARS, HUDA beauty and many more. MAC cosmetics offers more
than 7000 products globally including eye shadow, lip liner, different shades of foundation
and many more (Matusow, 2020). It is also regarded as the most searched beauty brand on
YouTube and the most followed beauty brand on Instagram, with 55.6 million followers on
both platforms(Statista Research Department, 2018). The assignment will now investigate its
macro external environment, micro and internal environment, stakeholder analysis. Then,
make recommendation for the MAC cosmetics segmentation, targeting and positioning to
achieve a sustainable competitive advantage. Moving forward, the assignment will then
discuss the marketing mix for MAC cosmetic and lastly there will be recommendations made
for MAC cosmetic.
Part 2- Environment Analysis
2.1 – General Macro External Environment
A Pestle analysis is used for this macro external environment analysis because is a suitable
framework and a strategic planning tool used to explore various factors affecting a
companies or organizations market environment (Yüksel, 2012). The Pestle analysis
(Appendix 1) will cover the political, economic, social, technology, legal and the
environmental issue for MAC Cosmetic.
2.1.1- Political Issue (Law)
MAC cosmetic will need to follow the rule set by FDA under the right of Federal Food,
Drug and Cosmetic Act (FD&C Act) and the EU Cosmetic regulation by not using forbid
ingredients in its cosmetic such as silicon, paraben or dimethicone in order can continue to
sell their product in the UK (M.A.C, 2022b).
2.1.2- Economic Issue (Price Inflation)
Based on Statista, food prices increased by 5.9% in the UK between March 2021-2022
because of the Brexit and COVID-19 pandemic (Wunsch, 2022). Consumers choose to
spend on more necessities such as groceries and entertainment rather than spending on
cosmetics (Jones, 2020). There is a survey conducted by Deloitte had also proof that
consumer are more likely to spend their money for leisure, travelling or savings rather than
spending on non-necessities products after the Covid-19 pandemic (Barua, 2021). This also
proves that MAC cosmetic has a higher probability of losing their consumers since make up
products are not necessities and the product itself is not cruelty free and consumers might
consider natural and cheaper cosmetic brands, which will negatively impact MAC cosmetic's
finances.
2.1.3- Social Issue (Cruelty Free)
The social issue of cruelty-free is a serious concern for MAC cosmetic due to the high
number of brands working in this area and gaining many customers' satisfaction. According
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to a survey conducted by the cosmetic business, 36% of women prefer to choose cruelty-free
cosmetic companies over non-cruelty-free cosmetic brands, and the younger generation is
considering cruelty-free when purchasing cosmetic items (King, 2018). On the other hand,
consumers born between the early 1980s and early 2000s are members of Generation Y, who
seriously consider cruelty free, sustainable, and ethical factors when purchasing cosmetics
(Arli et al., 2017). The Generation Y is considered as a group of powerful consumers
(Marton et al., 2020) and MAC cosmetics is ranked as the favourite cosmetic brand for
Generation Y (aged 25-40) according to a survey conducted by a data journalist (Ibbetson,
2020). This has also proofed that if MAC cosmetic lost the group of Generation Y
consumers, it will cause negative financial impact for its organization. Next, we will be
looking into the economic issue which might affect MAC cosmetic.
2.1.4- Technological Issue (Vegan Beauty Products)
According to Forbes, the demand for the vegan beauty market is rising and seems more
robust (Larson, 2021). It is estimated that the revenue of the natural and organic cosmetics
market will reach 339 million pounds in 2025 in the United Kingdom (Statista Research
Department, 2021). Vegan beauty debuts have nearly doubled in the last five years,
according to Mintel's Global New Products Database (GNPD), expanding by 175 percent
from July 2013 to June 2018. (McDougall, 2018). As vegan beauty trends continue to grow,
consumers are highly demanding it; Generation Y also considers natural, vegan beauty
products when shopping for cosmetics (Chior, 2018). Thus, MAC cosmetics should
therefore consider making their cosmetics vegan to avoid losing their largest potential
Generation Y customers.
2.1.5- Legal Issue (Counterfeit Issue)
There is a report by professional beauty shows that 17% of the UK women knowingly
purchased counterfeit product online, and the counterfeit beauty products are on the rise
since the beginning of the COVID-19 pandemic (M. M. Macleod, 2022). Counterfeit
products always seize opportunities for growth especially for those popular and well-
established best-selling products (Schiffer, 2020). As MAC cosmetics have become
enormously famous and iconic, products sell extremely quickly on the internet. This leads to
stock running out, giving counterfeit products an advantage. According to the Global Brand
Counterfeiting Report 2018, luxury businesses lose $30.3 billion per year owing to online
counterfeit items, and counterfeit products are now on the increase, making even more
income since the e-commerce and Covid-19 pandemic began. (Soto, 2021). Therefore, MAC
cosmetic will need to take this in serious consideration because counterfeit products will
negatively impact on its brand image and revenue.
2.1.6-Enviromentalle Issue (Sustainable Products)
According to a survey by the marketing technology, consumers aged between 16-64 which
includes the Generation Y would pay more for the cosmetic if the packaging is
environmentally friendly (Stagia, 2020). Sustainability is an important issue in 20th century,
the most successful cosmetic company Lush had commitment to a 100% eco-friendly
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