B2B Marketing Report: Analyzing MAC Cosmetics' Strategy in Africa

This report delves into the realm of Business-to-Business (B2B) marketing, with a specific focus on MAC Cosmetics' strategic expansion into the African market. The analysis begins with an in-depth examination of the African market, including industry analysis, competitor assessment (highlighting L'Oreal and Revlon), and customer segmentation based on demographics and purchasing patterns. The report then explores MAC's marketing strategy, outlining its objectives, targeted segmentation, and the importance of understanding consumer behavior in the African context. The report also discusses distribution channels and the need for MAC to adapt its approach to effectively reach its target audience. The report underscores the significance of strategic planning in achieving long-term marketing goals, emphasizing the need for MAC to tailor its products, pricing, and promotional strategies to resonate with the diverse consumer base in Africa. Overall, the report provides a comprehensive overview of the challenges and opportunities MAC Cosmetics faces as it seeks to establish a strong presence in the African cosmetics market.

Business to Business
Marketing

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Analysing African market...........................................................................................................1
Marketing Strategy of MAC cosmetics.......................................................................................4
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................9

INTRODUCTION
Marketing is considered to be a vital goal of every organization for scrutinizing its future
objectives. It is basically a primary act of promoting the sales of an enterprise with a need base
formulation of either diversifying or expanding its business operations. Business to business
marketing which is also known as B2B marketing is a critical activity in which a particular firm
approaches another company with a specific purpose of selling its own goods and services to
them (Armstrong and et.al., 2014). It is regarded as a complex procedure with few numbers of
prospective buyers and a rationalised approach towards them. However, the buyers of B2B
marketing are considered to prolong for a substantially long term period. B2B marketing largely
relies onto maintaining a personal relationship among the dealers where there is a major
recommendation of illuminating certain innovative content.
It therefore signifies a prominent demanding factor of B2B marketing with more number
of research into the chosen arena. The present report is segregated into two major sections of
market analysis and market strategy of MAC cosmetics. It is because of its recent plans of
expanding into the markets of Africa. MAC cosmetics is a well known cosmetic brand of
Toronto which was primarily founded in the year 1984 (Baines, Harris and Lewis, 2002). It is
basically a manufacturing group of varied beauty products which is now planing to expand its
services into the existent market of Africa. It is therefore important for MAC to conduct a
primary investigation of Africa's prevailing market structure with a prominent consideration of
launching with a differentiated approach of its own.
Analysing African market
MAC is fully concentrated to build some apt beauty products for its largely targeted
segment of women. The market of MAC cosmetics duly offers its product to both the individuals
and some related organizations. It is therefore a renowned name in the global existence of
cosmetics with a popular recognition at almost every corner of the world. It has a unique brand
image of its own due to some relevant approaches of being a cruelty free range of products with
no harm to animals and no testing of its products on them (Blakeman, 2007). Another major
reason of largely being attracted towards its product is because of its highly experienced make up
professionals who are duly appointed at each of its stores of cosmetic ranges to priorly attend the
customers and clarifying their doubts and concerns.
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It also uses some highest quality ingredients in manufacturing their products with gives it
a prior opportunity to draw the attention of more number of users. Some other possibility of
MAC is to make an international expansion of its business operations where it can together
consider for a diversification of its existent products and services by duly addressing the trends
of its chosen market (Chikweche and Fletcher, 2012). This will together help MAC to precisely
understand the ongoing preferences of their consumers into its newer market arena with a
prominent consideration of fabricating some apt products to match those acknowledged needs
and demands.
MAC has thereby opted for Africa to internationally expand its business operations
within the additive scenario of Africa. It is however with a need base consideration of largely
improved system of urbanisation and regulatory requisitions of operating business. This is
constantly affecting the civilisation of Africa with high number of independent women and their
temperament of disbursing a large proportion of their incomes into some apt beauty products
(Christopher, Payne and Ballantyne, 2013). It is however due to another crucial reason of a large
exposure of western culture with an increased level of education into the major existence of
African youths. It is therefore important for MAC to primarily research the existent market
scenario of Africa. A superior market research of Africa recommends MAC to initiate with a
need base approach of evaluating two major aspects of analysing the African market.
From which, the foremost factor is to consider an industry analysis of Africa which will
duly regard to some major number of competitors to MAC with their varied segments of
customers and their several forms of buying goods. The next stage is to assess the distribution
channels of African market with their prevalent structure and types (Cronin Jr and et.al., 2011).
MAC is purely into the manufacturing sector of fabricating its varied range of cosmetics and
therefore a primary consideration of market analysis can be initiated by prominently examining
the prevailing industry of Africa into this peculiar stream of beauty products.
Industry analysis hereby refers to some crucial elements of research, as stated below-
Competitors- Contenders are a single challenging factor to MAC where it duly gets
weakens because of its high priced products. Presently, the two illustrious companies of L'Oreal
and Revlon are recorded to be the biggest rivals of MAC in Africa. It is however due to their low
priced strategy for which the consumers can duly alter their choice of brand (Czinkota and
Ronkainen, 2012). Revlon in 2015 has been recorded to be a leading player of colour range
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cosmetics in Africa and gain a firm market share of around 19%. It is also due to some of its
other strategies of promotion where it has duly appointed some celebrities of Africa to advertise
its product via varied channels of television and magazines, etc.
Therefore, it is hereby important for MAC to reconsider some dissimilar prospect of
fabricating its products for its newer segment of African consumers. This can be done by
implementing a distinguished strategy of marketing in Africa with its varied other components of
product, placing and promotions (Dibb, Farhangmehr and Simkin, 2001). However, MAC can
also modify its existent strategy of pricing products by dividing the overall market into few
separated portions and later fixing the price of a particular product as per the susceptibility of its
segmented groups. The major competitors of MAC in Africa has been ascertained as the two
renowned companies of Revlon and L'Oreal. An existent statistical data of Revlon has shown a
spectacular data of 19% of market shares in the cosmetics industry which is equivalently
pulsating the shares of L'oreal with a minimal ratio of 3%. Therefore, it gets vitally important for
MAC to gain a strategic positioning into the African market with a differentiated approach of
attracting people.
Customer segments- The customer segment of Africa into this particular track of
cosmetics is largely accumulated by a major number of female users. It is due to their prime
fondness of applying make up in almost all their life events with another concern of facing
numerous sort of challenges at their workplace with a discriminatory approach of appearance
(Egan, 2014.). Due to which, the women were often paid less than compared to the men which
was later resolved after a major involvement of governmental acts into it. However, this sort of
discrimination at the workplace has duly changed their mind states where the women now
largely prefers to wear make up at their work to look good.
They believe it as an aid to their prospective career and future growth by acquiring a
higher position at the workplaces. MAC can therefore use a similar strategy of parting the
customers with varied accessible alternatives of market segmentation (Fillis, 2010). A profound
market segmentation for MAC is to vitally opt for a demographic partition of customers that duly
represents their age, gender and income. Into which, the gender is preoccupied by the potent
category of women to effectively serve them with their prior consideration of a liable product.
Demographic segmentation has been considered to be a suitable form of segmenting the African
market by MAC where it largely relies on the income of its targeted customer's. As per the recent
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statistics, Africa is currently having a populated with around 1.1 billion people who are residing
in 54 major countries of Africa with a linguistic GDP of 1.80 trillion pound. It is therefore
considered to be a resourceful continent with near about 44.7% of per capita income. MAC can
thereby reference to some of its wealthiest countries of Africa where it can successfully launch
its advanced products with a proportionate fixation of price. For example, Namibia has a per
capita income of 7694.44 dollars.
Purchasing patterns- This relates to the assorted behaviour of clients in selecting a
particular product which duly signify their varied levels of making choices. It is therefore
regarded to a steady criterion of assessing some significant behaviour of the buyers in Africa.
Buyer's behaviour is usually considered evaluating the three main facets of buyers which duly
represents either their psychological, socio-cultural or economic aspect of purchasing goods
(Gordon, 2012). The psychological factor seemingly defines their own individual interest of
purchasing a particular product with a due consideration of their lifestyle and its major
preferences. The socio culture on another hand has been analysed to be a significant pressure by
the peer or family members to opt for a particular product which reflects the ongoing market
trend.
The economic factor is yet another element of choosing a particular product to match the
accessible income of the person. It is highly determined into the people with a low level of
income and thus with a foremost priority of saving funds. Therefore, the African consumers with
a similar conceptualisation are more likely to purchase a huge variety of colour cosmetics which
could be a prior advantage to MAC (Hanssens, D. M and et. al., 2014). It is because of their daily
custom of wearing loud make up that together raises their level of confidence unlike other areas
where a bright make up is usually carried on some leading occasions.
Another crucial analysis is to closely scrutinize the “distribution channels” of African
industries with their assorted structure and types. It is another major consideration of MAC to
duly investigate into the major requisition of allocating products into its expanded area of Africa.
Presently the African industries are using an indirect channel of distribution with a good number
of retail stores (Kotler and Armstrong, 2005). This particular agenda of indirect distribution
flows through certain specific channels of allocation which is defined as per the structure of a
business enterprise. Like for example, the similar industries like MAC are currently using a
mediate form of distributing its products to the consumers.
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Into which, the manufacturer is duly liable to allocate its products to their distributors.
The distributor is then obligated to assign the products into all their respective retail stores
through which the user can finally purchase it. Operating within an indirect channel of
distribution is a critical process into which the respective firms are likely to make a large
investment of funds to aptly pay their associated channels (Michman, 2006). MAC is therefore
required to opt for an applicable channel of distribution which will serve as the best possible
mean to reach out a maximum number of clients and customers by together coordinated with its
economic system.
Marketing Strategy of MAC cosmetics
A strategic approach always helps the firm to set a long term objective of timely attaining
its stated goals and targets. It is basically a long term planning for marketing goods and services
to achieve a sustainable aspect of future growth. Marketing thereby consists of some basic
elements for primarily assessing the consistency of a prevalent market which is then followed by
targeting a peculiar segment of consumers (Mothe and Thi, 2010). It later provides a strategical
advantage to the firm where it can easily address the differentiated needs and preferences of its
referenced client's. Marketing strategy of MAC therefore relies onto set a need base objective by
finely assessing the primary needs of its customers and making an apt plan to satisfy them.
Marketing objectives of MAC is however based on some of its predefined principles, as
stated below-
Targeted segmentation- It is the foremost objective of MAC after considering a profound
investigation on the ongoing trends of its expanded market of Africa. It has therefore decided to
opt for a demographic segmentation of women as its targeted clients. However, along with
people's gender, a “demographic segmentation” duly considers segregating the age and income
levels of the customers (Park, 2004). MAC is primarily introducing one of its existent range of
lip balms by approaching two several propositions of women into it. It is with two dissimilar
groups of young aged girls and adult women with a related product with different facets for both.
It is thereby parted to address their differentiated requisition of product. The primary
group of teenagers thereby refers to the school and college going girls within an age unit of 13 to
25 years. However, the another group of adult represents the working women from 26 to 45
years of age (Rust and Verhoef, 2005). Such targeted segmentation will priorly help MAC to
appropriately cover a major number of prospected customer's from the overall market with an
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equivalent response by them. It will also help the cited firm to make a fine allocation of its
budget along with a cost effective measure of fabricating its product.
Product differentiation- It is yet another cognition of marketing which duly helps the firm to
source numerous potential clients by duly differentiating the needs of its targeted service users. It
is also considered providing a strategic approach to MAC for launching a distinguished product
as compared to the similar offerings of the existent market in Africa. Product differentiation is
thereby considered as an advantageous method into which the firms duly creates an apt image or
value of their brand name with a loyal approach to its newer base of customers. It together gives
a prior chance of competing at a non priced area by considering some other alternatives of
designing a different product with higher quality (Zimmerman and Blythe, 2013). This will
effectively help MAC to competently beat its major rivals like Revlon and L'Oreal where they
may have a similar range of product but still won't be able to match its superior attributes.
Therefore, the cited firm with a similar cognition has duly analysed the above market scenario of
Africa where a most of the women are fascinated with coloured cosmetics, MAC has also
decided to launch a quite dissimilar product of lip balm for its two major segments of young
aged and adult age group of women.
The lip balm fabricated for young girls is made up of earthy ingredients with some
natural colouring agents and a strong flavour of assorted fruits in it. However, the lip balm
manufactured for adult age group comprises some major content of colouring agents for giving it
a firm touch of make up. It has been decided after considering the differentiated needs of both
the groups in which the primary group is usually school or college going girls and thence they
are not allowed to wear any sort of make-up (Chand, 2013). Contradictory to that, the secondary
group refers to office going women who often prefers to wear a good amount of make-up at their
workplaces and thence opts for a more number of colouring range of cosmetics. It is therefore
stated as an apt differentiation of products by MAC to crucially address the distinguished needs
of both its targeted segments of groups.
Benefits and Competitive positioning- An effective product development itself gives a
competitive advantage to the firms where it precisely addresses the differentiated needs of its
targeted segment of customers. On investigating the above market analysis of Africa, Revlon
was considered to be the biggest existing competitor of MAC with some of its prior strategies of
developing low priced products. However, MAC can effectually beat this rivalry factor of
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Revlon after determining a significant need of launching a new product by priorly identifying the
desires of its African clients (Impulsive buying, 2015). Into which it has already segmented a
proportionate target of service users to achieve the competent positioning at that particular
market. An apt pricing strategy can equivalently benefit MAC where it can formulate a different
method of pricing its newly launched product as per the income level of both the groups.
Marketing mix- It refers to build a perfect combination of a product with some of its other major
configurations of pricing, promoting and distributing to the service users. It is thereby referred to
another strategy of marketing with its four leading constituents of product, price, place and
promotion as mentioned below- Product- MAC has hereby launched a related product of lip balm with its different
attributes to satisfy both its targeted segments of customers (Marketing planning, 2015).
The product is then firmly differentiated on the basis of the existing needs and demands
of its prospected clients with a need base of fulfilling their several requisitions. Price- Fixation of price is a critical approach where the firm is duly liable to level its
expenditures by together attracting its clients. MAC has thereby fixed the price of its
product with a distinguished approach of satisfying the consideration of both its groups.
Into which, the cited firm has developed a comparatively low priced product for the
primary group of young age people. Contradictory to that, it has fabricated a quite high
range of products for its another group of adults. It is due to a varied income levels of
both its group into which the young age group earns a less income in form of pocket
money from their parents and thence considers buying low cost products. However, the
adult group on another hand mainly tends to purchase a quality product with no such
preference of price and thus they can afford a high cost product as well. Promotion- MAC has considered to approach an equivalent preposition of broadcasting
the presence of its newly launched product. It thereby uses some similar means of
advertisement via televisions and magazines to acknowledge its existent activities to the
targeted segment of customers (Baines, Harris and Lewis, 2002.). It also distributes
pamphlets and brochures at schools, colleges and the workstation of its referenced clients
which also includes various promotional offers and discount coupons for attracting a
larger segment of people to try its fresh product.
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 Distribution- It is where MAC has opted for both direct and indirect channels of
distributing its goods to the users. The indirect channel matches the prevailing market of
Africa where almost all sort of products are duly available at the retail stores of MAC. It
is especially for its another group of adult women who primarily prefers to visit the store
for buying a particular product by duly communicating to the assistants at the store. MAC
has specially appointed some skilled employees at its customer service department to
attend and resolve any queries or concerns of such customers at each section of its store.
A direct channel thereby refers to an online selling of goods where the clients can
directly place an order through the official website of MAC (Next, 2015). It is crucially
designed for its primary group of young age people who are seemingly active into such
varied sort of online activities. MAC also provides a free home delivery of products on
ordering for the first time and together gives an option of trying out their sample
products. The online participant can together check for the features of a particular product
before placing an order and can also place their own experience into its feedback column.
CONCLUSION
The above report articulated some crucial factors of marketing with a requisite
consideration of utilizing a strategical approach of plan. It thereby showcased a prominent study
of MAC cosmetics where it has effectively planned to make an international expansion of its
products and services. For which it opted for the prevailing market of Africa by primarily
investigating into its existent marketing scenario and later objectifying its own differentiated
strategy of marketing.
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