An Exploratory Study into Cosmetics Extension Advertisements Impact

This report presents an exploratory study investigating the influence of cosmetics extension advertisements on consumer attitudes and behavior, particularly within the luxury market. The research explores the impact of advertising on purchase intentions, brand loyalty, and overall consumer perception of cosmetic products. The study delves into the concept of brand extension, consumer buying behavior, and the role of advertisement in shaping consumer attitudes toward luxury cosmetic products. The methodology involves a combination of primary and secondary data collection methods, including semi-structured interviews and focus groups, to gather insights from consumers aged 18-30. The report examines the effectiveness of various advertisement strategies and their influence on consumer choices. The findings offer valuable insights for luxury fashion brands seeking to leverage advertising to support their cosmetic extensions, providing managerial implications and recommendations for successful advertisement strategies within the competitive market.

An exploratory study into how cosmetics extension
advertisement influence consumer’s attitude and
behaviour towards the extension product

TABLE OF CONTENTS
CHAPTER ONE.............................................................................................................................................................4
INTRODUCTION..........................................................................................................................................................4
1.1 Background of the study ...............................................................................................................................1
1.2 significance of the study................................................................................................................................3
1.3 Research aims and objectives........................................................................................................................3
1.4 Research methodology ..................................................................................................................................4
1.5 Research structure..........................................................................................................................................4
CHAPTER 2...................................................................................................................................................................6
LITERATURE REVIEW...............................................................................................................................................6
2.1 Introduction....................................................................................................................................................7
2.2 Brand extension concept................................................................................................................................7
2.3 Concept of brand extension for luxury goods ...............................................................................................8
2.4 Consumer buying behaviour .........................................................................................................................9
2.5 Luxury brand extensions and consumer buying behaviour ........................................................................11
2.6 Role of advertisement on consumer attitude for luxury cosmetic products ...............................................12
2.7 impact of informational and emotional advertisement on brand extension.................................................13
2.8 Consumer knowledge..................................................................................................................................14
2.8 Conclusion...................................................................................................................................................14
CHAPTER 3 RESEARCH METHODOLOGY...........................................................................................................16
3.1 Introduction....................................................................................................................................................1
3.2 Research design.............................................................................................................................................2
3.3 Research philosophy......................................................................................................................................3
3.4 Research approach.........................................................................................................................................3
3.5 Research choice and strategy.........................................................................................................................4
3.6 Research technique........................................................................................................................................4
3.6.1 Data collection......................................................................................................................................4
3.6.2 Sampling...............................................................................................................................................5
3.6.3 Data analysis.........................................................................................................................................5
3.8 Ethical consideration .....................................................................................................................................6
3.9 Limitation of the study ..................................................................................................................................6
3.10 Summary......................................................................................................................................................6
REFERENCES................................................................................................................................................................8
APPENDICIES.............................................................................................................................................................11
A1 Sampling details ..........................................................................................................................................11
A2 Primary data collection details.....................................................................................................................11

A2.1 Phase one: Semi-structured interviews with cosmetics shoppers ......................................................11
A2.2 Phase two: Consumer focus groups....................................................................................................12

CHAPTER ONE
INTRODUCTION

1.1 Background of the study
Fashion industry is one of the most dynamic and volatile industry of the economy. The impact of
consumer choices and attitude is directly linked with brand loyalty and growth prospects of the industry.
Globalization has enhanced competition for businesses and product choices for people at large (Iglesias,
Singh and Batista-Foguet, 2011). This has created intense market situation for the fashion and cosmetic
industry. UK beauty industry is growing efficiently in the present era. The market is worth £17 billion, it
is forecasted to grow 16 per cent by 2016. The impact of recession was also low on the industry as UK
beauty market grew at the rate of 15.5% during economic slowdown as well (The value of UK fashion
Industry, 2016). It reflected market growth from £6.1 billion in 2008 to an estimated £7.1 billion in 2013
(Jara and Cliquet, 2012). Thus, on the basis of the given figures it is visible that the trend for cosmetics is
developing in the UK market. Makeup segment reflects highly growing demand in UK. The figure
reflects a positive relationship between disposable income and demand for fashion products in the market.
The stated figures draw a clear picture of industry strength and consumer loyalty.
Figure 1.1: Contribution of Different fashion segments strength and consumer loyalty
Source: The value of UK fashion Industry (2016)
Consumer attitude and behaviour has a direct impact on the success and growth of business units.
Companies in the present competitive era adopts innovative measures to develop consumer loyalty
towards different products and services offered (Solomon, 2014). These days, the luxury market is no
longer enjoyed by only the affluent society, it has become more accessible to audience. This phenomenon
1

is supported by the thesis of Khraim, (2011), who refers to the democratization of luxury significantly
influencing consumers’ spending habits and social trends. Driven by the increasing demand in luxury
goods and higher spending power of the middle class, luxury brands keep expanding their brand portfolio
to attract new customers (Gucci launch its cosmetics line in NYC, 2015).
Brand extension is one of the common and effective strategies adopted by luxury brands at large to create
an effective and well developed impact on sales maximization and brand loyalty. Fashion brands have
particularly frequently been using brand extension as a key strategy to stimulate growth. It is a cheaper
and less risky way of extending existing product line rather than creating new brands all the way
(Solomon, Russell-Bennett and Previte, 2012). This strategy has helped companies in enhancing market
share within the global market. Companies such as Gucci, Burberry etc. has successfully adopted this
measure in order to provide wide variety of products analyzing their specific needs thus developing high
trust for the company. The strategy has helped fashion brands to anticipate consumer needs and meet
them efficiently though brand extensions to attain positive perception for products in the market. Müge
Arslan and Korkut Altuna, (2010) however examined that the success of brand extensions is uncertain
and unpredictable as it is widely dependent on consumer attitude and perception. The figure reflects a
clear picture of brand loyalty in different industry. Brand loyalty in skincare segment is high because
consumers are sensitive towards the products and its result to them. Associating with one brand makes
them unwilling to try new products or brands in the market.
Figure 1.2 Brand loyalty for luxury products
2

Source: Beauty is big business for Britain (2016)
Hence, in order to ensure the successful implementation of the strategy and to develop a competitive edge
within the market, companies have adopted effective and innovative advertisement strategies for the
buyers. The above figure represents a clear picture of consumer loyalty for luxury product categories and
range as well. Choi and et.al., (2010) stated in a research that advertisement helps in communicating mass
audience about product availability and existence which helps them in enhancing brand loyalty and
demand for the products. Advertisements are the source of enhancing consumer knowledge about the
product availability, usability and features. It helps companies in converting non users into users. In
addition to this advertisement also enhance perceived fit as it helps consumers in developing positive
relations between products and parent brand (How Not to Extend Your Luxury Brand, 2005). In the
present competitive era companies are developing advertisement to influence the purchase intentions of
the buyers for extension products. The study will focus on analyzing whether advertisements influence
their purchase intentions toward the extension product or not.
The aim of the present study is “to explore the effectiveness of cosmetics
extension advertisement in influencing consumer's purchase intention towards the extension product”.
The dissertation has developed an in-depth analysis of different aspects of the topic such as consumer
perception about product extension advertisement along with evaluation of its impact on buying
behaviour of consumers. Extensive study has been undertaken to investigate a valuable analysis of the
research topic. To conduct the study well developed industry analysis and individual behaviour of
3

consumers attitude has been evaluated in order to analyse the impact of advertisement for luxury product
categories in the market.
1.2 significance of the study
The demand for luxury products and services are increasingly developing in the competitive market.
Consumer demands and needs are changing widely in the economy which has created an indefinite
impact on business growth and success (Anwar and et.al., 2011). Given a practical relevance for brand
extensions within the luxury sector it has been analysed that there are not many known studies addressing
this topic. It is significant to understand the managerial process involved in the extension and examine
key determinants influencing the cosmetics brand extension’s success along with the impact of
advertisement on consumer attitude and behaviour (Wang, and Sun, 2010). The outcomes of this research
will provide useful insights for luxury fashion industry when managing brand extensions, with a better
understanding of consumers’ attitude and behaviour. Hence, the study will develop an in-depth
understanding on how luxury fashion companies could utilize advertisement to support their cosmetic
extensions and will understand the application of the same in practical business situations. It will develop
a detailed analysis about the concept of brand extension and its relevance for luxury product range of
cosmetics. It will consider different aspects of consumer behaviour and attitude towards luxury brand
extension and impact of advertisement on consumer attitude and behaviour for the products. The study
will also focus on analyzing whether advertisements influence their purchase intentions toward the
extension product or not.
1.3 Research aims and objectives
The aim of the present study is “to explore the effectiveness of cosmetics extension advertisement in
influencing consumer's purchase intention towards the extension product”. In order to attain the stated
aim researcher will conduct an in-depth analysis of the topic and attain well developed results from the
same. The objective developed to attain research aim in an effective manner has been discussed
henceforth.
 To understand the concept of brand extension for luxury cosmetic industry
 To analyse consumer buying behaviour for luxury cosmetic products
 To examine the impact of cosmetics extension advertisement on consumer buying behaviour for
product extensions
 To provide managerial implications and recommendations about successful advertisement for
cosmetic extensions of luxury fashion labels
4

1.4 Research methodology
The present study had adopted inductive research approach as there is no specific theory to test for the
research. In addition to this, researcher applied constructivist paradigm for analysing interpretivist
epistemological view. This is because the theory is based on contribution of participants for the study.
Both primary and secondary means of data collection has been used for the study as it helps in attaining
valid and reliable research results. Primary data has been collected by conducting 4 semi- structured
interviews and 2 focused group administration from a group of 12 consumers belonging to age group of
18-30 years. This age group has the most dynamic and frequent buyers with different characteristics
hence it helped in enhancing reliability and reducing biases in the study. Researcher used multi-method
qualitative approach to increase the credibility and trustworthiness of the research. It helped in analysing
the data effectively from different perception triangulation was used in the study which helped in
removing possible biasness. The technique of photo elicitation for cosmetics advertisements from those
fashion brands who extended in cosmetics has been applied in the research to attain effective results.
1.5 Research structure
Research structure helps in developing clear and effective means of setting format for forming a research
study. This thesis is organized into five chapters. The overview of the dissertation structure is as follows:
Chapter 1: Introduction- This introductory chapter presents the background of the study with an
explanation and justification of the research aims and objectives. It develops a clear overview and
understanding about the research topic.
Chapter 2: Literature review- This chapter gives critical review on the prior literature related to the
concept of brand extensions. It carried an extensive secondary research for analysing and implementing
different theoretical models for the present study to analyse the social behaviour of consumers and
business strategies. The concluding section subsequently draws the research gap and limitations on prior
research of brand extension.
Chapter 3: Research methodology- This section will focus on analysing different tools and research
techniques in order to effectively attain the research objectives and develop a structured means of
undertaking research. It will focus on analysing research design for undertaking research study to analyse
qualitative aspects of the research.
Chapter 4: Analysis and discussion of data- This section of the study will focus on analysing the
research findings and results for overall analysis. The research results will be delivered in a structured and
presentable manner using thematic analysis for data.
Chapter 5: Conclusion and recommendations- This chapter of the study will focus on analysing the
overall study and relate it with the set research objectives. This part of the study will analyse the
5

successful analysis of the research objective. In addition to this recommendation regarding consumer
attitude towards luxury brand extension and impact of advertisement on consumer attitude and behaviour
for the products. The recommendation will be limited to luxury brands and cosmetic industry specifically.
6

CHAPTER 2
LITERATURE REVIEW
7

2.1 Introduction
This section of the study is crucial for developing a well developed base for secondary
research analysis in order to attain in-depth knowledge about the subject and topic such as in
the present case “to explore the influence of brand extension advertisement on consumer’s
attitude and behaviour towards luxury cosmetics extension”. Majority of the studies undertaken
of the topic were associated with non luxury brands, based on hypothetical extensions (i.e.
extensions not introduced in the market) or on fictitious brands (e.g. Lynch 1999; Winer 1999;
Klink and Smith 2001). These researches contributed efficiently in enhancing the conceptual
understating on the subject. However, analysing the real market situation it has been evaluated
that customers are exposed to a lot of information about the product extension.
It has also been examined that consumers are sensitive to the external factors such as
decisions of retailers (Collins-Dodd and Louviere, 1999), competitors actions (Czellar, 2003)
etc. Furthermore, the overall evaluation of the reseaches contributed in analysing that fictitious
brands are unable to reflect consumer feelings for brand extension appropriately, hence
generalization is referred for real-life decisions and consumption contexts is debatable.The
present study is significant for providing a detailed analysis regarding social perception and the
impact of advertisement of consumer buying decision. It will develop a detailed analysis about
the concept of brand extension and its relevance for luxury product range of cosmetics.
Consideration of different aspects of consumer behaviour and attitude towards luxury brand
extension, and impact of advertisement on consumer attitude and behaviour for the products will
be analysed in the research.
2.2 Brand extension concept
Figure 2.1 Brand extension categorization
Source: adapted from Pitta & Katsanis, 1995; Farquhar, 1989
8