ASE BUCHAREST

FAC U LTY O F B U S I N E S S AD M I N I S T R ATI O N

Internationalization of S.C.
FARMEC. S.A.
International Marketing Project

Coordinator: Prof. Moise Daniel

Constantin tefania Cristina

Dinc Iuliana
Dinc Mariana Mirabela
Al-Rassi Sama
Ruan Meng Ying

2014
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Table of Contents
Overview................................................................................................................ 2
SWOT Analysis....................................................................................................... 3
SWOT..................................................................................................................... 4
Marketing Plan........................................................................................................ 5
Market structure, segmentation.............................................................................5
Market demand...................................................................................................... 7
Issues and obstacles.............................................................................................. 7
Market characteristics and trends..........................................................................8
TRENDS.................................................................................................................. 8
COMPETITIVE LANDSCAPE...................................................................................... 8
Farmecs advantages............................................................................................. 9
The attractiveness of Italy by using the 4 Ps........................................................10
CONCLUSION........................................................................................................ 11
Bibliography......................................................................................................... 12

Overview
Farmec is a Romanian company founded in 1889 , it is the first and most important Romanian
company of cosmetic products when Molnar Moser laboratories are created in Budapest , then
in 1943 A small laboratory - Mol-Mos stands out and carries its activity in Cluj-Napoca.
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In 1965 Doina Milk is produced for the first time. Started more than 120 years ago, FARMEC
activity is well-known nowadays, both in Romania and worldwide, the companys products
being exported in countries from Europe, Asia and North America.
The care for beauty and the respect towards tradition, health and environment, completed by
the continuous research, originality and attention to its clients have turned FARMEC into a
highly esteemed producer over the years.
Nowadays, the companys portfolio sums up hundreds of products, the most famous ranges of
products being GEROVITAL H3 prof. dr. Ana Aslan, GEROVITAL H3 EVOLUTION,
GEROVITAL PLANT, ASLAVITAL, FARMEC, ASLAMED, DOINA, ATHOS and
OBSESIE.
Farmec company got many awards among them in Certificate -1st place- big enterprises in
2009 and has recently obtained the certificate of good manufacturing practice
We would like to introduce Farmecs products in Italy .Focusing mostly in their most
successful skin care products. like make up remover , tonic lotions , day creams , night
creams,anti - wrinkle creams , anti-age creams , demo cosmetics products , lift creams , skin
serum and ampoules , masks and exfoliants , eye and lip care and whitening creams from
Farmec , ASLAVITAL MINERALACTIV and Doina Milk.

Famous products of FARMEC

The product ensures delicate cleansing of sensitive skins. It remineralizes,

energises and soothes the skin thanks to its unique complex of natural Clay and
organic GojiB extract. Ferulic Acid has anti-age effects, it fights against free
radicals, soothes erythema and prevents oxidative aggression at cellular level.

It delicately removes the make-up and impurities on the skin surface, and has a
moisturizing effect at the same time. The combination of Calendula Oil and
Cocoa Butter in the formula plays an essential role in emolliating, regenerating
and moisturizing the skin.

The cream ensures and maintains a constant moisture level of sensitive,

couperose, wrinkled skins all day long, and protects against the harmful
effects of pollution and UV radiations. (Farmec, 2014)

SWOT Analysis
Besides the fact that the SWOT Analysis is based on knowing the Strengths, Weaknesses,
Opportunities and Threats, it involves a lot of research, brainstorming and the strong
knowledge regarding the market that the services or, in our case, the products would be
introduced on. It also includes some parts of statistics that can help the researcher, as it helped
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us, analyze and compare its vision and mission, values and main goals with the ones of the
competitors.
Before knowing this, we, as the main managers, should first collect information about the
competitors, both direct and indirect ones, to establish their position on the cosmetics market
and take a look at their evolution (presented in the part). All these things contribute to the
creation of a well defined, complete and correct SWOT Analysis.
As presented below, Farmec, with the participation of all the departments gathered
information, made a SWOT Analysis, which is focused on our main goal: to place our
products on the Italian cosmetics market.
This was made, as any other SWOT Analysis, at the beginning of the project, after studying
the market, with the purpose of contributing to the settlement of the whole plan. This process
has as main managerial goal, after presenting it, to develop the strengths, eliminate the
weaknesses through the implementation of the best measures, get the ability to exploit the
opportunities and get far from the threats, actions that would best contribute to the
development of Farmec on the Italian market and also on the International market.

SWOT
Strengths
-

The experience achieved among its development on the international market

The fact that Farmec has already built a name, it is widely known as a successful
brand at an international level
Strong and well defined Vision and Mission
The experience and the professionalism that the group has been showing in the
industry
The large range of products
The well trained, informed and motivated personnel
The coherence of the main marketing strategy
The high quality and low price that define the product.

Weaknesses
-

The lack or little capacity of production in Italy

The lack of a partner that would support the company and protect our brand on the
Italian market
Different legislation than in our country for the cosmetics and taxes
No past experience regarding the consumers behavior in Italy.

Opportunities
-

Launching a new range of anti-age products that are very well sold all over the world
in the last decades
The high demand for this type of products in Italy (see the 4Ps part)
A very wide market, which allows the development and penetration and targeting
numerous segments

Threats
-

Competition of the local and national brands in Italy, that are well perceived and
already have loyal customers
The reluctance of people living in Italy for using the products of a Romanian brand
The influence of the Italian prejudices regarding Romanian people on their choice

Marketing Plan
The assumptions of the marketing plan represents the estimation key drivers which
depends the success of the company. In case of Farmec range that could be:

Assumption 1: The anti wrinkle and natural cosmetic products are searched permanently for
their rapidly actions, especially in Italy
Assumption 2: Due to low prices products compared with the ones in Italy, that could be an
advantage for helping sales
Assumption 3: Brand, traditionally from Romania, will attract many Romanians settled in
Italy, those being among to the final consumers
Segmenting cosmetics products using benefit segmentation
Marketing segmentation is regarded as one of the core elements of marketing,with benefit
segmentation often is referred to as the most meansingful form of segmentation.
The aim of this study is to:
Explore the benefit associated with cosmetic products from the Italian consumers
perspective.
Analyse the comparative effect of the target group on consumers satisfaction.
Evaluate the usefulness of benefit-based segmentation in understanding cosmetic-related
behaviour among consumers in Italy.

Market structure, segmentation

In order to understand and satisfy the wants of the customer, the companies have to
develop a complex market analysis. The market analysis investigates both the internal and
external business environment. It is vital to carefully monitor both the internal and external
aspects regarding the business.
Every marketing strategy is based on expected customer behaviour in a certain market.
In order to know the customer and its expected buying process, each company has to segment
the market, to target the most appealing customers and to position, deciding on how to create
an identity or image of the product in the mind of the customer.
A market segment composes of individuals, groups or organizations with special
characteristics that incline them to have similar product needs. It allows the companies to
provide better demand satisfaction. The main segments are defined based on the following
criteria: socio-demographic, economic, psychographic and behavioural.
Socio-demographic segmentation consists of dividing the market into groups based on
variables such as age, gender, family size, income, education (demographic variables)
and also social class, groups, family (social factors). The company's products are designed
for female with law to medium income, with secondary and higher studies. The target age is
between 20 and 50years, 50 + extended. The products in the portfolio reach a fairly wide
audience, as follows: Mortifying moisturizing cream with Aloe Vera has the target age 2035 years. Regenerating Soft cream with marigold and Soft nutritional cream with Argan
is for women between 20 and 45 years; Wrinkle Cream has the target age 35-65 years;
Farmec Company is aware that family members can strongly influence the buyer behaviour,
especially because there are lots of families that are shopping together. Marketers are also
interested in the roles and influences of the husband, wife and children on the purchase of
different products and services. Thats why Farmec target women between 20 and goes over
65 years old, Farmec Company has a various products for all skin types, starting with soft
skin, mixt skin and dry skin. In the future it is possible to develop products for teenagers also,
like acne skin. (Farmec, 2014)
Psychographic variables have been a popular segmentation variable. In psychographic
segmentation, buyers are grouped according to variables such as Social Class, Lifestyle, or
Personality. Peoples interest in various products can be determined by their lifestyles, and
people can express their lifestyles through the goods that they consume. The main target,
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represented by young women 20- 35, consists of physically active women, interested in
fitness and health. They have a busy life and are either working, in school, or both. Moreover,
they have a pleasant personality, they socialize a lot because are fun lovers and entertainment
loving individuals and are always connected to the rest of the world. To promote the idea of
friendship, fun and happiness with their healthy skin, the Farmec Company has special
campaigns and commercials, to promote a healthy skin.
Behavioural segments can group consumers in terms of occasions, loyalty and
benefits. The Farmec Company segments different manifestations which are celebrated in the
country. They offer products not only for special holidays, like Christmas and Easter, but also
for different festivals. Every product has more or less loyal customers. The Farmec Company
is well known in this field, because they have valuable customers which buy their Gerovital
products, which are on the Italian market since 2009. They do not like only the cream texture,
but they enjoy their perfume and the feeling when they lie it all over the face. Benefit
segmentation puts marketers in the position to understand what the main benefits are
customers look for their product. Besides the texture and the feelings, customers think that the
products offer a good balance between quality and price and they know that they buy an
original ingredients on the market.
In terms of socio-demographic segmentation, the company aims to law and medium
customers, with secondary and higher studies, with ages between 20 and 50 years old, 50 +
extended. We can say that the firm targets the same category of consumers as the
GerovitalBrand. Depending on the products, there can be made the following segmentation.
Mortifying moisturizing cream with Aloe Vera targets people with age between 20 and
35years; Regenerating Soft cream with marigold and Soft nutritional cream with Argan
has the main target female persons also between 20-35 years; Wrinkle Cream addresses only
to female with age between 35 and 55 years old; Regenerating Soft cream with marigold
and Soft nutritional cream with Argan is an unique combination of the market that targets
women over 20 years old and has no limit of age
These products use a psychological segmentation strategy similar to its main
competitor, dividing customers according to Social Class, Lifestyle, and Personality and
trying to offer products that suit them best. Although they produce facial care products that
address to all kind skin female, like Regenerating Soft cream with marigold and Soft
nutritional cream with Argan, they have certain products that target mainly the active
female. Therefore, the lifestyle of consumers is essential in this process of segmentation. For
example, those from Farmec Company produce Mortifying moisturizing cream with Aloe
Vera, which addresses to single and not only, young and active female, passionate about
healthy life, sports and outdoor activities Regenerating Soft cream with marigold and Soft
nutritional cream with Argan is another alternative, because is also designed for singles and
not only, young and active female passionate by a healthy life style.
The behavioural segmentation is also a good method of dividing consumers. Like their
competitors, they offer products and special offers for different occasions which are
celebrated in the country. To keep its customers satisfied and to win their loyalty, the products
is involved in numerous campaigns and supports numerous events. (Sport and healthy)
Consumers appreciate the products not only for the texture, but also for the benefits that they
get through their natural and original ingredients. They can receive free tickets to some
favourite beauty salons and gyms sponsored by the company and being involved in many
urban activities.

Market demand

Italy has a sophisticated and well-developed cosmetics market. Approximately 9 billion of

cosmetic products are sold in Italy every year, making it the fourth largest market in Europe.
Although highly competitive, there is potential for growth in several sectors. Body care, hair,
face and hygiene products continue to dominate the cosmetic industry and account for 60 per
cent of all cosmetic sales. The most positive forecasts are for raw materials, naturally derived
products and innovative or unique products. Naturally derived products are an expanding
market segment within Italy. Italian consumers are becoming increasingly attuned to a
wellness culture and products derived from natural active ingredients are progressively
popular.
As Italy imports almost all its raw materials, it is possible to supply Italian manufacturers with
ingredients such as aloe Vera, lavender and essential oils. There is an increasing market for
mens products as men have discovered the pleasure and the benefits of dedicating more time
and energy to their wellbeing. There are also good prospects for products that distinguish
themselves from what is already available on the Italian market e.g. Tea tree and eucalyptusbased products. A key factor is the packaging of the product. Italians prefer products that are
nicely packaged and with a creative design, therefore it is recommended that the casing and
wrapping are of a high quality, with time and effort put into product presentation. (Farmec,
2014)

Issues and obstacles

In order to be competitive in the Italian market companies should be prepared to heavily
invest in promoting their products and brands. Companies must successfully promote their
image and appeal to Italian tastes and fashion preferences. Packaging is also a key
component. Products should be packaged in a well-presented, eye-catching manner. In
addition, to sell cosmetic products in Italy, a company must have an Italian representative (a
subsidiary, representative office, an agent, a distributor and/or importer) whose company is
correctly registered in Italy.
All ingredients used in cosmetic products are subject to stringent European and Italian
regulations, which are designed to guarantee consumer protection. The Italian consolidated
text of laws of the EU directive n. 2002/34 concerns production and commercial distribution
of cosmetics products in Italy. The decree laws are important, as they provide not only a new
set of rules regarding production and distribution, but also a new definition of cosmetics. This
definition allows for cosmetics to be recognised as playing a role in the protection and
maintenance of the wellbeing of the skin and related areas. It is mandatory for a company
importing Australian cosmetic products to maintain a file or dossier containing all the
information needed to evaluate the safety of the cosmetic product and prove its effectiveness.
Italy imports nearly all its cosmetic ingredients. Substances such as Aloe Vera, lavender and
essential oils are used in the production of locally made products. Demand for raw materials
will increase as Italy continues to sell its products abroad. Italian exports have been growing
at an average rate of five per cent per year over the past 10 years.
Opportunity still exists in the Italian cosmetics market. Despite its competitiveness, there is
still room in the marketplace for innovative products of high quality and good design.

Market characteristics and trends

In 2010, body products experienced the highest increase in sales value compared to other
cosmetic categories. With 16.2 per cent of total sales, this category reached a value of almost
1,270 million.
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Products for the face, with sales of 1,180 million and a growth of almost 1 per cent,
represents the second most important category. Apart from facial wipes (which, with sales of
43 million, increased by 4.1 per cent) and anti-ageing, anti-wrinkle creams (which grew by
three per cent to a value of more than 465 million), other segments experienced a reduction.
This included the eye area and zone-specific products which, with sales of 125 million, fell
by almost two per cent and the moisturising and nourishing creams which, with 269 million
in sales, experienced a contraction of 1.4 per cent.
TRENDS
Skin care in Italy is a highly competitive category in which developments are generally driven
by the development of new concepts and ongoing technological innovation. In line with the
consistent ageing of the Italian population, the major trend in skin care in Italy during 2013
was the shift towards anti-ageing products. Sun filter, anti-wrinkle, skin nourishment and
radiant complexion were all key words used in the marketing of skin care over the course of
the year.
The categorys leading manufacturers thus introduced various new combination products
which promise total skin repair, UV protection and intensive care. Within facial care,
concentrated serums played a more important role towards the end of the review period due to
the higher concentration of active ingredients, although serums still comprise a niche segment
in skin care. In general, Italys skin care manufacturers are taking an even more scientific
approach than they have ever before as they seek to include an increasing number of cuttingedge medical and cosmetic ingredients in their skin care products.
However, skin care in Italy is a category which is increasingly threatened by the rise of BB
creams and CC creams in colour cosmetics, which perform a much wider range of functions
than merely decorating ones cheeks or lips. Indeed, the myriad of colour cosmetics which
were launched in Italy towards the end of the review period hold much more promise with
products which offer functions such as hydrating the skin, minimising wrinkles and
diminishing lip lines placing more pressure on existing skin care products.

COMPETITIVE LANDSCAPE
LOral Italiana Spa maintained its leading position in skin care in 2013 with a 15% value
share, followed by Beiersdorf with an 11% value share. However, Beiersdorfs Nivea Visage
was the categorys leading brand during 2013 with a 5% value share, followed by Vichy,
Shiseido, LOralDermo Expertise and Clarins, each with a 4% value share. Beiersdorf has
consistently invested substantial resources in the promotion and advertising of its Nivea brand
across all beauty and personal care categories and in addition to its status as a well-recognised
and longstanding beauty and personal care brand in Italy, Nivea continued to benefit from
Beiersdorfs sustained investment in innovation, which continues to drive demand for skin
care to a great extent. 2013 also saw the introduction of the Cellular Anti-age product line,
which is available in various formats including a night cream, a day cream, an eye zone cream
and various serums, all of which contain hyaluronic acid and magnolia extract. The range of
products offered under the companys existing product line Q10 Plus was widened in 2013
with the addition of a serum and an Energising version of its day cream.
Farmecs advantages
Started more than 120 years ago, FARMEC activity is well-known nowadays, both in
Romania and worldwide, the companys products being exported in countries from Europe,
Asia and North America.

The companys modern history begins in 1967, when FARMEC became the first
manufacturer of Gerovital H3 prof. Dr. Ana Aslan creams and emulsions in Romania.
The products were addressed to women in their 40s, when the skin shows the first signs of
ageing. Today FARMEC produces over 400 cosmetic products, covering a large range of
usage.
The originality and quality of FARMEC products was officially recognized in 2002 when
the company was granted the International Quality Certificate ISO 9001:2008.
The active principles that they use mainly come from nature: nourishing fruits rich in
vitamins, not only tasty but also good for the beauty, autochthonous medicinal plants that you
thought you would find only in teas but which regenerate your skin and hair, clay from the
mountains which would have been only dirt if we hadnt found out what miracles it can do.
Last generation ingredients are added to all these, tested and combined by our specialists so
that you receive the best for your beauty and health.
The care for beauty and the respect towards tradition, health and environment, completed by
the continuous research, originality and attention to its clients have turned FARMEC into a
highly esteemed producer over the years. Nowadays, the companys portfolio sums up
hundreds of products, the most famous ranges of products being GEROVITAL H3 prof. dr.
Ana Aslan, GEROVITAL H3 EVOLUTION, GEROVITAL PLANT, ASLAVITAL,
FARMEC, ASLAMED, DOINA, ATHOS and OBSESIE. (Statistics, 2014)
In order to reach its performance objectives and to maintain a top quality standard,
FARMEC has concluded partnerships with various famous partners: the Romanian
Society of Cosmetology, Iuliu Hatieganu University of Medicine and Pharmacy of ClujNapoca, the Dermatology Clinics of Cluj-Napoca and Bucharest, Clinics for testing the
products efficiency, Dermscan Laboratories form France and Evic International Romania.
The company has a huge potential to enlarge the Italian market due to all this advantages,
which are offered to the Italian women.

The attractiveness of Italy by using the 4 Ps

We choose to penetrate the Italian market because in Italy we identified an important segment
of potential customers, more exactly, women with principal age of 65 years old and more than
that.
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Italy is the European country with the highest percentage of old people, according to Eurostat
Statistics, which published a study which shows that Italy is the European country with the
highest percentage of the population of 80 years. Over 6.1% of Italian population is old, while
the average age in this country is 43.8 years.
The legislation in Italy is allowed and we decided to penetrate this market. The environmental
conditions also made us to decide on Italian market. The unfavorable environmental
conditions lead the skin aging effect, like air pollution, water pollution. These factors favor
the consumption of the anti-age product, in order to protect the skin, for skin hydration.
For launching on the market the Farmec products, we take into consideration the 4P:
1.
2.
3.
4.

Product policy
Price policy
Distribution policy
Promotion policy

Product policy
The product that we launch on Italian market, will be an unique product which is designed to
resolve two essential problems at the women with 65 years old and more than 65 years:
dehydration problem and the appearance of wrinkles. The products are going to respect the
provisions of European Union. The product addresses to women with age between 35 and
more than 65 years. The types of the product is represented by day cream, night cream and
extensions of product, such as toning lotion, eye contour cream. (scribd.com, 2014)
Price policy
It is known that the product with highest prices gives a guarantee of product quality, so the
Farmec product will apply for a competitive price at the level of the direct competitors from
Italian market. It is about 15-20 % lower than the price practiced by LOreal.
Distribution policy
The Farmec products can be find especially in pharmacies, in the area dedicated to cosmetic
products. We choose pharmacies because in this way we can create in the mind of the
potential customers the association with idea that the products have a high quality for healthy
and body care. The supermarkets are other efficient channels, because the supermarkets
provide large coverage of the market. Also here the product will be placed in special area
designed for cosmetic products. A strong point is that the Farmec product will be placed in
stores that are specialized in cosmetic field.
Promotion policy
For promotion we not chose the TV channels because of their high costs in Italy. We apply for
newspaper dedicated to women. Also we apply for promotions and possibilities of testing the
products. Another point is the fact that we will distribute the catalogues with information
about the products in stores, pharmacies. (Wikipedia, 2014)

CONCLUSION
Just like artistic currents, beauty is transposed over years, in more and more expressive forms,
according to the century when they are shaped. Beauty canons change at an extremely rapid
pace but there are things that resist over times, just like precious art objects. The tradition of
more than 120 years of existence of Farmec, as we are known by the friends of our products
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has shown that there are some things beyond beauty. Charm may be expressed in thousands of
ways, it pushes through all the rules and it does not want to be defined as everyone finds his
or her own meaning. From the fascination of a smile, of a glance, of a warm voice to a colour
or a colour palette and an amalgam of perfumes. When we created Farmec products, we didn't
think of rules, of how to get fuller lips, darker skin and perfect symmetries, weve thought
about customer and their natural beauty. Weve chosen to show everyone that they are
beautiful and to put forward those small details which make them different from the other
women.
We believe that the Italian market will be very successful. Because we share the same cultural
background, our female friends in Italy also have similar skin characteristic, various
conditions has been explained theoretically that enter the Italian market will be a bright future,
but our theory is not just on paper , we will use our actions prove FARMEC product has its
unique charm, the effect of the product can explain everything.
We also think that natural skin care products will be prevalent worldwide, Italy is only a small
beginning, when the concept of nature slowly spread to the world, our work will be more
simple, but the analysis of the market is essential, with a fast and efficient way to let everyone
know FARMECs qualities, and choose FARMEC as a daily skin care. At the same time, we
will not stop learning, studying the competitors and run over.

Bibliography

Farmec. (2014). http://www.farmec.ro/. Retrieved 2014, from

http://www.farmec.ro/: http://www.farmec.ro/
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Green, C. (2014, 07). http://www.independent.co.uk/news/uk/home-news/boozyignorant-intolerant-but-very-polite--britain-as-others-see-us-9633967.html.

Retrieved 11 2014, from http://www.independent.co.uk/news/uk/homenews/boozy-ignorant-intolerant-but-very-polite--britain-as-others-see-us9633967.html
scribd.com. (2014). http://ro.scribd.com/doc/89806683/Referat-Sc-Farmec-Sa.
Retrieved 2014, from http://ro.scribd.com/doc/89806683/Referat-Sc-Farmec-Sa.
Statistics. (2014).
http://epp.eurostat.ec.europa.eu/portal/page/portal/statistics/farmec. Retrieved
2014, from http://epp.eurostat.ec.europa.eu/portal/page/portal/ statistics/.
Wikipedia.
(2014).
http://ro.wikipedia.org/wiki/Farmec_%28companie%29.
Retrieved 2014, from http://ro.wikipedia.org/wiki/Farmec_%28companie%29.

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