Analysis of Australian Market for Himalaya Lip Balm

This report analyzes the external environment in Australia that affects the business operations of Himalaya lip balm. It also examines the competition and market trends in Australia. The target market for the lip balm is teenagers and adults. The report includes a SWOT analysis and a PESTLE analysis of the Australian market.

MARKETING MANAGEMENT

Introduction
The company produces health care products in the name of Himalayan healthcare products,
which includes Ayurveda ingredients. The company provides products related to
pharmaceutical, personal care, wellness, nutrition, baby care, and animal care. Himalaya
herbals is planning to expand its market and launch its Himalaya lip balm in Australia
(Himalayan since 1930, 2018). This report undertakes the analysis on Australia`s external
environment that affect the business operations. Further, this report analyses the three
competitors who have their business in Australia and affect the Himalayan lip balm. The
report analyses the demand and forecast the market trends of the Australian market. The
demand forecast is the prediction of the demand for the next two years in the area of business.
The product demand will be analysed under the micro and macro environmental analysis.
Product description
Himalaya herbals is an Indian based company established in 1930. Products related to
personal care include lip balm that shine with naturally glossy strawberry lip care (Himalayan
since 1930, 2018). It consists of a moisture retention formula, which has skin soothers that
can make the lips smooth and glossy. The balm consists of anti-oxidants and other natural
actives care for the lips that in turn protect from environmental pollution.
Meso analysis
The competition in the industry is very high as there are number of organic lip balm
producers in the world. While entering the Australian market, the Himalayan lip balm should
have some competitive edge to penetrate the market. The existing competition in the market
are-
Carmex- it is a brand of lip balm that is being produced by the Carma producers. The product
consists of benzocaine, menthol, camphor, phenol, and also the salicylic acid. Further, it is

made up of inactive ingredients such as lanolin, paraffix wax, cocoa butter, and petrolatum.
Although, the company has certain brand loyalty but it is clear that it does not have organic
ingredients. Camex has irritating ingredients, which can cause inflammation near the lip area
especially with the people who have sensitive lips. Brand loyalty is the major factor that can
be diverted with the help of proper advertisement by Himalayan lip balm (Bohari, Hin, and
Fuad, 2017).
Vaseline lip balm- this lip care is formed with 100% natural petroleum jelly that protects the
dry lips for long lasting moisturization. It is a triple purified solution that feels gentle on the
on the lips. This product can give smooth and long lasting moisturisation to avoid dryness. At
the same time, this product to be the competitor of Himalayas lip balm, which enforces the
company to create such an effective marketing strategies to grab the Australian market
(Bohari, Hin, and Fuad, 2017).
Blistex- it is an America-based company, which produces, develops, and markets the
personal care products. The company focus to develop lip care products in US. It provides a
medicated lip ointment healings that serve dryness and relieves the cold stores. This company
is the private subsidiary of fresh breath limited. It is said that carmex works faster than blistex
but at the same time, blistex is lighter and good for kids and especially for the sensitive lips
(Blistex, 2019).
The research report reveals that Australian skin care market has earned a revenue of US $
1720.3 million. In regards to total population of revenue, it is expected that market will grow
by 1.5% in the near future. Apart from skin care, it is seen that revenue derived from personal
care and cosmetics amounts to US $5,997 million in 2019. It is expected that the sector will
grow by 1.7%. the market growth straightforwardly considers that there is a huge scope for
growth of Himalayan lip balm in Australian market (Statista, 2019).

Target market
The target segment will be teenagers and adults. The Himalayan lip balm is enriched with
100% natural colour, peach shining lip care that is free from preservatives, antioxidants,
mineral oil, silicon, and petroleum jelly. Some of the main ingredients are peach kernel oil
that is a good nourishing agent and even rich in antioxidants that rejuvenate the lips. The
segmentation of the market is done to remain useful of the specific 7Ps for the Himalayan lip
balm in Australia that would be the teenagers, middle aged people and adults because they
strongly are aware of organic ingredients and are concerned too for the product they are using
for skin care (Bohari, Hin, and Fuad, 2017). It reflects that the demand for the Himalayan lip
care is higher than in case of age groups. Another segmentation is based on the social class
and income groups, under this targeting middle and upper level group.
SWOT analysis
Strengths
Location adds advantage to the business operations as India is quite rich in organic and
Ayurveda ingredients.
The mane of the brand itself creates a sense that the product is manufactured at the foothills
of the Himalayans. This company enjoys the advantage of first mover as it serves leapfrogged
in the series of which industry provides frozen foods (Fisher, Pan, and Wood, 2017).
Weaknesses
The company needs huge capital investment as it needs continuous flow of cash in the
company.

It highly depends on the raw material that it uses or that are seasonal in nature. Unavailability
of raw material act as a hindrance in the manufacturing process Fisher, Pan, and Wood,
2017).
Opportunities
Global expansions- the company has the potential to explore more and expand according to
organic products. As preferences of the customers have started on organic products and
benefit to the o in it. The business rubs on the basics grilling with the positive of under
greater organic product.
Threats
The inventory cost is as increasing lot of research development where a lot of global players,
who are entering the market (Fisher, Pan, and Wood, 2017).
During the financial crisis, products have become a little costlier.
Macro analysis
Pestle analysis
Political factors-
In Australia, personal care companies often face various regulatory associations such as
product safety Australia, strict competition with 1000 grammatical offers.
This provides and Australia`s safety, and Australia`s and natural industrial chemicals and
assessment share can get the regulations of newly beauty products. Green washing is one of
the major, which is within the organic industry. For example- emission reduction fund
provides incentives to the project so that where the projects are paid because of reducing the
emissions (Racz et al., 2018).

Economic factors- while evaluating the economic trends, it can be seen that discretionary
income reflects the same which the customers will carry to spend for an organic cosmetic
product. With the increase in more spending capacity and other, more skin essentials of
higher as well as the middle-class marketing plan. The GDP of the country is equivalent to
1.32 lakh crores USD in 2017 as it the 14th largest economy of the world. It grows with a pace
of 6% per annum. Agricultural sector contributes nearly 2% to the total GDP and
manufacturing sector contributes 6% (Fisher, Pan, and Wood, 2017).
Social factors- by understanding the socio-cultural factors of Australia in relation to organic
industry effectively positions and target the potential market. As the customers have become
aware of results of the daily purchases in the environment, increasing steadiness and
increasing natural cosmetics have grown the sale of new products (Song, 2017). With the
increase in environmental concerns and pollution, health consciousness have been increasing
among the customers and has identified the important drivers of organic product such as
which products and ingredients are beneficial for skin. The trend of organic driving often
applied increased environmental awareness and other health consciousness in order to create
customer value. Purchasing power of the customers living in Australia has increased in recent
years. It is seen that the people prefer organic products (Fisher, Pan, and Wood, 2017).
Technological factors-in technology-driven world, organisations must confirm that it remains
to innovate and advance with the use of technology. For personal care industry, technology
advancement plays an important role in outsourcing natural ingredients, general technology
and packaging programs during the business operations. For instance- recycling the plastic
and the company will ensure the using of recycling, and packaging procedures. An increase
in social media advertisements, the business gets and chance to communicate to its customer
and receive the feedback as soon possible (Racz et al., 2018). Technological ways will save
the money such as printed magazines, flyers, brochures, and advertisements. Most

importantly, technology has enabled particular product to deliver to home in a day or two.
Many sellers directly sell with the help of e-commerce with no plans to keep their products at
the store (Song, 2017).
Legal factors- Australia`s legalities are influenced by FDA regulated without even being
proved by the FDA –approved. Some of the leading laws include federal food and cosmetic
Act and fair packaging labelling product; these laws are the leading laws which beauty
industry has to follow (Song, 2017).
Environmental factors- ecological environment has various number of threats not only
limited to organic industry but as a whole. Increased industrialisation and regular burning of
fossil fuels that has caused numerous environmental issues (Gheibi, Karrabi, Mohammadi,
and Dadvar, 2018). Other issues relates to depletion of ozone layer, acid rain, carbon release,
melting glaciers, adverse weather conditions and rising sea level will affect the production of
Himalayan lip balm in Australia. The beauty industry focuses more on go “green” and the
packaging should be equally eco-friendly material (Song, 2017).

Demand analysis
(Source: Businesswire, 2019)
According to the research report with the help of industryARC 2018-2023, the demand for
emerging personal care products have been increasing. It is seen that with the advent of
technology, a business is able to a launch an efficient product in the name of lip balm of
Himalayan. Increasing people`s concern to buy the product has induced them to purchase
product as people started believing in the use of organic products rather than using the
chemical products for the personal care. People have started investing in buying the organic
product for their skin. These demand drivers motivate the organisation to grow its sales
(Businesswire, 2019).
The light balm of Himalayan can cover the major part of Australia`s professionals which can
would suggest for natural extracted lip balm so that the revenue generation can be paced up.
Consumer that can darken the often choices the colour of the company. Some of the offers lip
balms are related natural activities and other reset sources such as Economic factors- litchi,

cocoa, peach vanilla and strawberry. It is seen that people have become very conscious in
regards of choosing the personal care products as they wants to focus more on organic
because maximum usage of chemicals on skin and lips can spoil the skin (Source:
Businesswire, 2019).
(Source: Abnewsire, 2018)
The above graph reveals the size of organic market size, which is expected to grow to 25.1
billion until 2025 (Read, 2013). According to new report by the grand view research exhibits
9.5% CAGR in the particular period. The growing demand of the organic, skin care, cosmetic
products, and natural health care is anticipated to augment market growth in a particular
projected time. After the approval from the health and safety regulation bodies such as US
department of Agriculture and FDA to maximise the use of organic products in some of the
personal care products such as creams, facewash, lip balm, and hair products to pace up the
growth of industry. Various technological innovations aims to develop cost effective product
lines by certain organisations such as Himalayan, body shop and Amway. This organic factor
in the products are expected to become critical success factors in the industry (Abnewsire,
2018). The perception of the customers have changed to a great level by coupling the

increasing utilisation of environment sustainable products that has increased the growth of
organically produced products. Form the above graph, it can be said that skin care products
have gained a considerable attraction in a forecasted period and the segment is estimated to
grow more in future for nearly 10% from 2016 to 2025 (Abnewsire, 2018). Organic and
natural ingredients in the lip balm provides anti-oxidation, improves the skin quality, gloss
the lips with maximum moisture, and prevent them from not getting black due to sun. It is
observed that different companies are responsible under various strategic initiatives that
increase their presence in the market. This signifies that there is greater scope of Himalayan
lip balms in Australia (Pyka, 2017).
2019 - 2020
2020- 2021
0 5 10 15 20 25 30 35 40 45 50
Demand (In million)
Column1
Column2
Conclusion
Form the above discussion, it can be concluded that demand forecasting of a newly launched
product is extremely important because it considers many factors such as audience and
pricing. This demand is evaluated under the micro, macro and meeso analysis in the host

nation. The main three competitor of the company are Vaseline, Carmex and blistex that can
influence the demand of the Himalayan lip balm.

References
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