The Body Shop: Comprehensive Marketing Strategy and Analysis Report

This report presents a comprehensive marketing strategy analysis of The Body Shop, a UK-based cosmetics company. It begins with an executive summary and introduction, followed by an environmental analysis using PESTLE and SWOT frameworks to identify internal and external factors influencing the business. The report then examines The Body Shop's current marketing strategies, including Porter's generic strategies (cost leadership, differentiation) and intensive strategies (product development, market penetration, market development, diversification). A detailed analysis of the company's competitive advantages, assessed through Porter's Five Forces, is provided, alongside discussions of product rationale, segmentation, targeting, positioning (STP), and the marketing mix. The report concludes with recommendations on marketing objectives and goals, offering a complete overview of The Body Shop's marketing approach.

Marketing strategy

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................3
INTRODUCTION...........................................................................................................................1
PART 1............................................................................................................................................1
Environmental analysis of “The Body Shop”.............................................................................1
Current marketing strategy of “The Body Shop”........................................................................3
Competitive advantage of “The Body Shop”..............................................................................5
PART 2............................................................................................................................................6
Product rationale and specification of New products along with their benefits to an
organisation.................................................................................................................................6
Segmentation, Targeting and Position (STP) of “The Body Shop”............................................7
Recommendation objectives and goals.......................................................................................8
Marketing mix of “The Body Shop”...........................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

EXECUTIVE SUMMARY
Marketing strategies is an essential part of decision-making process made by the
management of an organisation which assist in promoting brand awareness in the market with an
intention of achieving huge customer strength. Marketing strategy deals with evaluation and
analysis of strategic initial position of a firm which help company in achieving desired goals and
objectives within pre-determined time period. The project describes the environmental analysis,
current marketing strategy, analysis of competitive advantage etc. Apart from this, introduction
of new product and identification of targeted people are also explained under this report.

INTRODUCTION
Marketing strategies play an important role in growth and success of an organisation which
requires marketing managers having effective skills and knowledge to analyse market situation
and needs through conducting marketing research and survey. It allows company to promote its
existing as well as new products into the market so as to aware its targeted customers and
influence their buying behaviour in favour of company's offerings. Without marketing strategies,
the organisations are failed to achieve huge customer strength as well as recognition in
competitive market. “The Body Shop”, a UK-based company which deals in providing
cosmetics, skin care and perfume products in the market is selected for the purpose of preparing
this report. It currently has owned more than 1000 products which it sells in over 3000 stores in
66 countries. The project includes evaluation of their current marketing strategy and position in
market. In addition with this, evaluation of brand's competitive edge (USP) in comparison with
the main rivals brands are discussed under this report. The project also explains environment
analysis, product rationale and specification, segmentation targeting and position (STP),
Marketing mix and proper recommendation on marketing objectives and goals of an organisation
(Baker, 2014).
PART 1
Environmental analysis of “The Body Shop”
Environment analysis is very important to conduct for a firm in order to identify internal
as well as external influencing factors which can affects the growth and expansion of business in
competitive market. For this, management of “The Body Shop” need to conduct PESTLE to
analyse external environment and SWOT to analyse internal environment. It can be further
discussed as under:
PESTLE Analysis
Political factors: It includes factors related with fluctuation in government rules and
policies that need to be comply by organisation to run their business operations. “The Body
Shop” is operated in UK where lobbying practice is much affected the UK market. The
regulations related with a list of forbidden ingredients is more strict in UK as compared to other
nations. Along with this, government stability is also less in UK due to which its affects of
supplying of products by company into market.
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Economical factors: Changes in the global economy influences the buying power of the
customers. In addition with this, exchange rates and taxes on products either increases or
decreases the prices of products which can affect the sales figure of company as well. Therefore,
“The Body Shop” are much affected in relation with selling of its cosmetics products if
economical conditions are not in favour of company (Banerjee and Soberman, 2013).
Social factors: The product sales of “The Body Shop” are affected by the changes of the
type of customers for example, teenager will not purchase the same product than a old lady. For
this, “The Body Shop” need to segment the market and accordingly add unique value to product
according to the needs and preferences of targeted people.
Technological factors: The post-consumer recycle plastics bottles which are full recycle
in one of the new technologies that can make huge impact on the product packaging.
Furthermore, “The Body Shop” should invest more in R&D department of the cosmetic
laboratories so as to discover new active ingredients from plants. It will help company in
attracting new and retain loyal customers for longer period time.
Legal factors: Environmental regulations is one of the important factor of legal
regulations which can be applied to the product associated with natural resources as plans and
animals. To control the use of chemicals in the production process, chemical regulations are also
important so that “The Body Shop” can motivate to produce healthy facial products without
using of chemicals.
Environmental factors: Animal testing is not prohibited yet but should be prevented
from the PETA's act. In addition with this, control over using toxic ingredients is not done
everywhere which allows company to use such ingredients in their cosmetic products. Thus,
“The Body Shop” need to protect environment though avoiding such ingredients in their
products (Crowther, 2011).
SWOT Analysis
Strengths Weaknesses
 “The Body Shop” have huge franchisee
network of over 2600 franchised stores
operated in more than 60 countries.
 Offering wide range of products of over
1200 and making continuous
 Low investment in marketing of its
products and services.
 Less control by the proprietors due to
franchisee system.
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innovative changes in its product
variety.
 Owned well designed store layout and
ambience which can easily attract large
number of customers.
 Attained high brand value
 Strong supplier network which assist
company in reaching their offerings to
maximum number of people.
 Attaining limited number of retail
outlets which makes impacts on their
sales volume.
 Opportunities  Threats
 To create awareness about natural and
eco-friendly products support company
to achieve growth and expansion.
 Using online platforms to sell their
cosmetics products and offering free
delivery increasing sales figure of
company due to having strong presence
of online buyers.
 “The Body Shop” offers cosmetic
products contains some exquisite raw
materials supplied from different
nations thus legislations of different
nations in respect of trad with supplier
have impact on its operations.
 High competition in the cosmetic
market as new brand products by rivals
are launched in market everyday.
 Economical downturn can affect the
sales revenue of company.
Current marketing strategy of “The Body Shop”
“The Body Shop” is most popular brand in UK offering cosmetics, skin care and perfume
products at global level with the help of franchisees. Due to this, they uses porter's generic
growth and intensive strategy in order to achieve growth and success (Geisler and
Wickramasinghe, 2015). Both strategies drives company to achieve competitive advantage and
attain strong position in market for longer period of time. Such strategies are briefly described as
under:
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Porter's Generic strategy: It forces company to pursue competitive advantage in chosen
market. It includes three generic strategies such as cost leadership, differentiation and focus. The
company either choose reducing product prices or differentiate itself from the rivals to achieve
competitive advantage. It can be further understood as under:
Cost leadership strategy: This is the strategy which is widely used by reputed
organisation such as “The Body Shop” for the purpose of achieving competitive advantage.
Using such strategy, “The Body Shop” prefer to reduce cost of their cosmetic products through
minimising the cost of production and selling prices. It enhance the profitability of company.
Due to offering products at lower prices than their rivals then it makes easy for “The Body Shop”
to them ahead in the competition among their rivals. Using such strategy assist “The Body Shop”
to compete with their numerous rivals such as Avon, Revlon, Clinique, Estee etc. through
maximising the buying power of targeted people by reducing cost of their cosmetic products
(Harrigan and Hulbert, 2011).
Differentiation strategy: Such strategy forces an organisation to bring new and unique
products through which they can differentiate itself from their rivals in market. Therefore,
adoption of such strategy is more useful for “The Body Shop” to attain strong brand identity in
market which can be possible through bringing innovation in their existing cosmetic products or
launch new products that cannot be introduced by any rivals into the market. It help “The Body
Shop” in achieving huge customer strength and achieve high profitability.
Intensive strategies of “The Body Shop”: It includes various elements of marketing
strategies which are explained as under:
Product development: The major strategy of “The Body Shop” is to achieve growth and
expansion of business at global level. For this, intensive strategy support “The Body Shop” to
introduce new cosmetic products containing unique ingredients that were not used by any rivals
earlier. It help company to capture large market share through offering them developed or new
product.
Market penetration: Using such strategy directs “The Body Shop” to achieve extra
growth with the existing cosmetic products in the current market segment in order to increase its
market presence through increasing number of retailers at different locations.
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Market development: Using such strategy directs “The Body Shop” to achieve further
growth through targeting its existing products to new market segments. For example, targeting
India to supply their cosmetic products increases its sales and revenue (Clow, 2013).
Diversification: Using such strategy directs “The Body Shop” to grow by diversifying
into new businesses through introducing new products into new market. For example, starting
beauty parlours where they can use their existing cosmetics creams for the customers.
Competitive advantage of “The Body Shop”
“The Body Shop” can achieve competitive advantage among their rivals through selling
unique and innovative products as compared with their rivals existing products. It is also called
as Unique selling propositions (USP). To achieve competitive advantage, “The Body Shop”
should make continuous innovative changes in their cosmetic products or can launch new
products containing unique ingredients so that it help them in attracting large number of targeted
customers as well as compete with rivals in more effective and efficient manner (Jobber and
Ellis-Chadwick, 2012).
Competitive advantage of “The Body Shop” can be analysed through applying Porter
Fiver Forces which are discussed as under:
Threat of new entry: The threat of new entry in cosmetic industry is low due to having
huge cost of entry. In addition with this, developing unique cosmetic products requires huge
amount of resources which are utilised under R&D and manufacturing process. High competition
is also one of the factor which restricts new firms to enter such as Avon, Revlon, Clinique etc.
have attained large market share. Therefore, “The Body Shop” has facing less difficulties from
the new entrants in similar market.
Bargaining power of Buyer: The bargaining power of buyer is high due to having large
number of rivals and availability of similar cosmetic products. In addition with this, such
products have more substitutes as well which forces existing companies such as “The Body
Shop” to reduce their product prices. If not reducing, then the targeted customers may shifted to
their rivals products such as Avon. Thus, “The Body Shop” is required to identify the buying
behaviour of targeted people and accordingly set pricing strategies so as to chive their loyalty
with company for longer period of time (McCabe and Meuter, 2011).
Bargaining power of supplier: The bargaining power of suppliers is high due to high
number of market players. For example, if the manufacture increases the product prices or if the
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countries increases tax then it forces cosmetic companies such as “The Body Shop” to reduce
their margins. Thus, the profitability of “The Body Shop” is very much depend on the behaviour
of suppliers and policies of government.
Competitive rivalry: There are huge number of rivals in cosmetic industry such as Avon,
Revlon, Clinique, Estee etc. which are concentrated to expand its business to developed
countries. Therefore, it may affect the sustainability and profitability of “The Body Shop” which
requires an effective decision and planning to develop its products in order to sustain brand in
competitive market for longer period of time.
Threats of substitutes: The threat of substitutes are high due to many competitors as well
as many number of substitutes. The people are nowadays are more rationale due to which they
prefer to buy substitutes products. Therefore, it must required for “The Body Shop” to provide
cosmetic products that to be innovative so as to tackle the risk of threat of substitutes.
PART 2
Product rationale and specification of New products along with their benefits to an organisation
Product rationale: “The Body Shop” is operated its business on large scale and has
owned a range of 1000 products which it sells in over 3000 stores in more than 66 countries. In
the year 2017, the company has generated approx. 387 million British pounds through sales in
Europe and the Middle East (Revenue generated by The Body Shop in 2017, by region, 2018). In
addition with this, “The Body Shop” has served its cosmetic products to more than 4.1 million
people in the UK itself which is huge in figures. Therefore, “The Body Shop” are much
financially capable to launch new product for their huge amount of customers which maximises
the chances of achieving huge profitability.
New product and its specifications:
“The Body Shop” is decided to launch new cosmetic product named as “Rejuvenating
Herbal Cream” containing various features such as unique blend of emollients, humectants and
vitamins hydrates and nourishes skin which help users to protects the skin against the moisture-
loss and alleviates the look of dry lines and softens the skins. The company claimed that it is
more effective for the both men and women ages over 30 with dry skin.
Features and Benefits of New product:
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“Rejuvenating Herbal Cream” includes unique ingredients which provides lots of benefits
to the skin of users. Each ingredient has bring some benefit which are given as under:
Hyaluronic acid: It is a moisturising compound found naturally in the skin and capable
of binding moisture to the skin’s surface (McHugh and Krukonis, 2013).
Aloevera: It is well recognized for its soothing and conditioning properties. It promotes
the removal of dead cells and replenishes it with new ones, giving the skin a radiant glow. It
improves the skin elasticity. Thus it refreshes the skin and makes it vibrant and young looking.
Sodium PCA: It binds water to the skin to help maintain an optimal moisture level.
Segmentation, Targeting and Position (STP) of “The Body Shop”
Market segmentation:
Every business organisation is required to segment its market so as to identify the needs
and preferences of each segment and plan accordingly to fulfil as quickly as possible. As
different customers have different attitude, beliefs and norms which can impact the sales figure
of company therefore grouping people of similar characteristics and needs in one segment makes
easy for “The Body Shop” to analyse their needs carefully (Pomering, Noble and Johnson,
2011). It consists of four types of segments which are given as under:
Geographical: Under this segmentation, the people are divided on the basis of their
locations such as region, state, country etc. It allows management of an organisation to make an
effective marketing strategies so as to attract them towards company's offerings. “The Body
Shop” is engaged in providing cosmetic beauty products in North America and the Eastern
Europe due to which they are having limited market share. It can be expand through supplying
products to Latin America and Asia pacific BRIC such as Brazil, Russia, India and China where
the cosmetic products are more in demands thus it seems profitable for “The Body Shop”.
Demographic: Under this, population is segmented on the basis of their characteristics
such as age, gender, income etc. Cosmetic products are mostly used by female customers thus
“The Body Shop” has mainly targeted them to achieve their sales target. But due to increase in
the number of male customers using cosmetic products, the profitability of company are more
favourably affected. According to the reports, men's make up industry will be of 2.4 billion
pound (Demographic market segmentation, 2018). Thus, launching “Rejuvenating Herbal
Cream” by “The Body Shop” which is more effective for both men and women will be profitable
for company.
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Psychographic: Under this, population is segmented on the basis of class, lifestyle and
personal needs. “The Body Shop” is offering cosmetic products which are more in demand due
to high preferences of female customers. According to the report, approx. 86% of women find
that wearing make up enhances their self-image. Therefore, it is important for “The Body Shop”
to put needs and preferences of female customers on main priority
Behavioural: Under this, the population is divided on the basis of their knowledge,
buying pattern, attitude etc. The people of urban area are more aware and prefer to use cosmetic
products as compared with rural areas thus the buying behaviour of urban people are in favour of
products offered by “The Body Shop”. Thus, it must required for management to invest more in
adoption of marketing tools to influence buying behaviour of urban people (Stachowski, 2011).
Targeting:
With the new product “Rejuvenating Herbal Cream”, “The Body Shop” has targeted both
men and women ages above 30. Apart from this, there are developed nations such as Korea
where men are equally willing to groom and use the products. Thus, it is important for company
to reach its products to such nations where demand is high. In addition with this, more
interactions with loyal customers through collecting feedbacks from them help company in
knowing their needs and fulfil them within limited period of time.
Positioning:
Every organisation is focuses on building good image and reputation on consumers mind
in order to attain strong position among their rivals in market. It can be done through investing
more money to advertisement and producing innovative products, more efforts to maximise the
interest of stakeholders etc. Therefore, “The Body Shop” need to make such kinds of decisions.
Through this, the company can easily recognised by the people across different nations which in
turn increasing sustainability and profitability of company.
Recommendation objectives and goals
SMART Goals: Marketing Goals which are designed by “The Body Shop” for their new
product “Rejuvenating Herbal Cream” should be specific, measurable, achievable, time bound
and relevant that will be further discussed as under:
Specific: Goals should be clear and specific for targeted people which can be created to
achieve high profitability and large market share. “The Body Shop” is set a goal of marketing
new products into market through using cross selling, up-selling and direct marketing strategies.
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It attracts both male and female customers thus bring more profitable outcomes which in results
higher profitability within limited time period.
Measurable: The goals must be measurable that means the management of “The Body
Shop” should ensure that expected outcomes can be achieved within allotted time period. For
example, expecting sales figures of new product reached to minimum 60% within 6 months.
Achievable: Marketing goals should be achievable which required proper resources such
as skills, personnel and finances. For this, the management of “The Body Shop” required to set
timeline to promote and sell new product into market to reach expected sales. For example,
employees must have skill-set in selling techniques as well as direct marketing initiatives so as to
attain goal within pre-determined time period.
Results-focused: Marketing goals should measure outcomes instead of activities
performed in launching new product. To launch and promote new product more successfully,
“The Body Shop” should hire new counter sales person which in results increasing sales revenue
of company.
Time Bound: The marketing goal should be linked to a time frame that creates a practical
sense of urgency. “The Body Shop” is expecting to have sales figures of new product reached to
minimum 60% within 6 months
Marketing mix of “The Body Shop”
The different type of objectives which are required to achieve through analysis of
marketing mix includes brand awareness, market share, sales and profitability. In this regard,
marketing of Body Shop with emergence of new product is defined below:
Product: “The Body Shop” should ensure first that launched product is healthier for user
and accordingly decide to sell in the market. The company has currently introduce new cosmetic
product named as “Rejuvenating Herbal Cream” containing unique and beneficial features such
as Hyaluronic acid, Aloevera, Sodium PCA etc. which protects the skin against the moisture-loss
and alleviates the look of dry lines and softens the skins (Zemlickiene and Maditinos, 2012).
People: “The Body Shop” should focus on educating the customers about the new
products which can be possible through use of their online consultants who can post materials
related to the company's products using simpler language.
Place: “The Body Shop” may use google map to facilitate its targeted people to locate
places of shops where are new products are easily available. The stores layouts of “The Body
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