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19th, December, 2012

Table of Contents
Company Background. 2
Macro-environmental Analysis PESTL.. 2
Political Factors. 2
Economic Factors. 3
Social Factors. 3
Technological Factors. 3
Environmental Factors. 4
Legal Factors. 4
Micro-environmental Analysis Porters Five Forces. 4
SWOT Analysis. 5
Strengths. 5
Weaknesses. 5
Opportunities. 5
Threats. 5
Segmentation Strategies. 6
Market Targeting. 6
Strategic Positioning. 7
Company Current Marketing Strategy. 7
Product 7
Price. 7
Place. 7
Promotion. 8
Proposed Marketing Mix the 7ps. 8
Price. 8
Product 8
Promotion. 9
Place. 9
People. 9
Process. 10
Physical Evidence. 10
Effectiveness of the Current CRM of the Body Shop. 10
Current CRM Strategy. 10
Ineffectiveness of Current CRM 12
New CRM Objectives. 12
How the objectives will be achieved. 13
Supporting the New CRM Strategy Using the 4Ps of Marketing Mix. 13
The Body Shop Marketing Plan. 14
Current Market, Customer, and Industry Trend. 14
New Market Objectives. 15
A Marketing Budget to Achieve the New Objectives. 16
Evaluating the Perfomance of New Marketing Objectives. 17
Conclusion. 17
Works Cited. 19

Company Background
Dame Anita founded the Body Shop Company, which is located in the United Kingdom, in
1976. Today, this company operates in 61 countries across the globe, with close to 2 500
outlets. The company mainly produces and sells a variety of beauty and cosmetic products,
which total to approximately 1 200. The Body Shop mainly targets males and females of
different age groups. In 2006, the ownership of Body Shop was transferred to LOreal, a
French cosmetics company. The mission of this company is to impart self-esteem in their
clients, protect the environment, be advocates against animal testing, while defending human
rights, and supporting the community trade (Mennen, 2011).

Macro-environmental Analysis PESTL

Political Factors
Different factors in the external environment of Body Shop continue to affect its market
operations. Most of these factors are beyond the control of this company, as it has less
influence on its external environment. Two major political factors have affected the
production and sale of beauty and cosmetic products by this company. First, political
instability in Guatemala limits the companys production of beauty products. Guatemala
produces Aloe Vera used in manufacture of beauty products by the Body Shop. Political
instability destabilizes major business processes and business transactions with foreign
countries. Secondly, Peru is also faced with political instability, yet it is the major producer of
the Brazil nut oil, used in manufacture of beauty products (Assenmacher, 2012).

Economic Factors
Body Shop Company utilizes the franchising policy as one of its
strategies for growth. The decreasing interest today makes the company
stands a better growth opportunity as this works in its favour. Secondly,
the global trend exhibits a decline of financial institutions, even as
countries are advised to brace for tougher economic times ahead. The
Body Shop, being a player in the global economy, will also feel a pinch in
case this happens in the future. In addition, the current exchange rate
indicates a gradual decline of the pound. Therefore, continued weakening
of the pound may result in increased prices on imports, including
products and product ingredients (Assenmacher, 2012).

Social Factors
Most social factors work in favour of the company. First, there is
increased awareness of the companys fair trade, as well as the nature of

products, which are natural, devoid of animal testing. Additionally, more

men are concerned with their appearances, thus will go for beauty
products. The company has registered an increase in the number of online
customers, considering that in 2008; approximately 65 percent of British
families had access to the internet. Finally, the willingness of the buy
anti-ageing products is a boost to the company (Mennen, 2011).

Technological Factors
Dangerous chemical and acidic components such as Kojic acid used in
beauty and cosmetics products may be harmful to peoples melanin count
in skin. This is according to the Scientific Committee on Consumer
Products. This makes preference for Body Shop products high, as they
are natural. In addition, technological advances such as internet boost
business operation and communication (Assenmacher, 2012).

Environmental Factors
The company ensures sustainable packaging of products and safely
disposes or recycles by-products. Additionally, the companys
responsibility in the deforestation issue raises concerns, since their
ingredients such as Brazil nut oil and palm oil are supplied from forests in
conserved places (Mennen, 2011).

Legal Factors
The EUs enactment of a chemical legislation in 2008, requiring all
imported chemicals in Europe to measuring 1 tonne per year, undergo a
registration with the newly set up body of European Chemical Agency
(ECHA). Additionally, from March 2009, animal tested products were
banned. This affects Body Shop differently (Assenmacher, 2012).

Micro-environmental Analysis Porters

Five Forces
The probability of new entrants in the market is low as there exists high

barriers to new entries in the market. This is because of the existing

beauty companies in the market, which are mature and strongly
established. The suppliers to Body Shop are small and limited. These are
mainly communities that engage in fair trade with the company for
provision of company ingredients. There is considerable rivalry between
Body Shop and other beauty companies. However, the main competitors
include Johnsons and Johnsons, Doy Soaps, Loreal Kids Shampoo, and
Himalayas Baby Care. These are mature markets, which are also niche
players. Apart from its retail outlets and consultants, Body Shop has no
specific group buyers. Finally, substitutes for Body Shops products are
mainly the homemade and other non-organic beauty products
(Kossowski, 2007).

SWOT Analysis
Niche positioning by Body Shop makes its products unique in the market,
and this helps differentiate them from those of competitors. The
company is also known for its ethical stand of against animal testing, as it
aims at providing natural products to its customers. In addition, the
diversified geographical presence is advantageous. This company has 61
branches across the globe. This is an opportunity for growth, even as
market risks are minimized. Finally, by practising fair trade with the poor
world communities, Body Shop incurs low costs of ingredients, while
maintaining an ethical image to the public (Assenmacher, 2012).

There has been a previously considerable decrease in Body Shops
profits. Between 2006 and 2008, profits dropped from 9.4 percent to 8.5
percent. In addition, there is weak performance, as the UK market has in
the past registered a weak performance as compared to other markets.
This leads to a decrease in market shares (Assenmacher, 2012).

The testing of different cosmetic products in 2007 established that they

used harmful Lead in their lipsticks. However, Body Shops products

were purely natural, thus, boosting consumer trust in Body Shop. In
addition, the online availability of Body Shop captures potential
customers in a cost-effective manner, as more people today search online
information on beauty products before buying (Kossowski, 2007).

Intense competition from other big and small cosmetics company has
forced Body Shop to reduce product prices for favourable competition in
the market. Clashing Ideology is another threat. Since LOreal acquired
Body Shop, its animal testing on products conflicts with Body Shops
stand against animal testing. This becomes confusing to clients. Finally,
the global unpredictability of the economy forces people to cut on
spending and save money for future use. This reduces companies market
share (Assenmacher, 2012).

Segmentation Strategies
Body Shop bases its market segmentation on two main aspects, which
include behaviour and demographics. Basing on demographic
segmentation, market segmentation involves age. This therefore falls into
two main categories of customers, including adults and young people.
In behaviouristic segmentation, customers are categorized into two
groups, including advanced users and beginners. Therefore, market
segmentation results in four categories of customers, including young
advanced users, middle-aged advanced users, young beginners, and
middle-aged beginners (Pahlavanzadeh, 2011).

Market Targeting
Body Shop targets more females aged16-55. These should be well
educated and with good computer skills. The kind of men Body Shop
targets are those aged 30-35, with a stable income. Men in the
cosmopolitan are also targeted due to their increased awareness of their
physical appearance. Nonetheless, the targeted customers are those that
are willing to spend more on beauty products, given Body Shops
considerably high product prices. These target customers are also those

that appreciate and show interest in beauty products that are

environmentally friendly. In return, Body Shop donates a percentage of
its profits to charity, and mainly construction of schools in India and

Strategic Positioning
The Body Shop uses various strategies to appeal to customers. Its stand
against animal testing and support for fair community trade shows
passion. The mission of the company to activate self-esteem, protect
human rights and the environment bring out the company as responsible
and natural, an appealing image to customers (Assenmacher, 2012).

Company Current Marketing Strategy

The Body Shop bases on its image of being natural and earthly to market
itself. Therefore, the brand messages carry this information. Most of the
marketing for Body Shop is done online as it is believes that most
environmentalists do not subscribe to newspapers.

Products include shaving, hair and body, face care, accessories, and Eau
de Toilettes. The company conducts annual research on relationship
between the product and market demand. These products come in
packages, which are considerably big. Generally, customers are not given
an opportunity to choose from a wider range of products, as these are not

The prices of Body Shop products are considerably high because of the
great differentiation and nature of branding, which is ethical and
environmental friendly. The big packages of products contribute to their
high cost. This is why the target market include the financially stable.

The Body Shop mainly sells its products in its different physical outlets,
at the Body Shop Home Scheme, and over the internet. However, this
company has invested more in its virtual presence. Its online distribution
channels help its clients to shop for products more easily.

Promotion of mens products is through monthly advertisements in
different periodicals that target men. In addition, products for men are
advertised for the whole year on Google Ads and other promotional sites
with high male viewing. Womens products are advertised through flyers
and other channels with high female audience throughout the year.
Additionally, promotion is through gifts and presents to specific females
four times a year (Assenmacher, 2012).

Proposed Marketing Mix the 7ps

Customer relationships are essential in the marketing strategy of
companies. Therefore, basing on customer relationships of Body Shop
Company, recommendations on a more effective marketing matrix can be
made. This new marketing mix could be effective, as the current one has
not managed to achieve the sales and marketing targets of this company.

For a better marketing mix for Body Shop, the prices of its products
should be considerate of the present economic climate. Therefore, pricing
should not be based on their branding, but be determined in relation to
their competitors prices. High prices make customers shy away from
buying products, considering the present harsh economy. Therefore,
lower prices, with competitors in mind, will attract more customers.


The company should consider product diversification. When products are

diversified, customers will have a lot to choose from, thus eliminating
limitation of their choice. In addition, region specific products will be
highly appreciated in the market. For instance, producing and selling
sunscreens in India will boost market shares of the company. Products in
smaller packaging will attract more customers as they are easily
affordable, compared to the big expensive packages offered today by the

Body Shop should improve its online channels of distribution by
venturing in the social media channels such as Face book, Twitter, and
You Tube for advertisement purposes. The Body Shop should launch a
page for each of these sites and invest more in social media
advertisements. Promotions on the social media will increase product
visibility as more people today spend a considerable time on Facebook,
Twitter, and YouTube. Additionaly, teaming up with media channels such
as MTV will help in the promotion of the existing products.

Exploring newer markets is essential for Body Shop to achieve its
business objectives. Investment in new markets will reduce the
companys operational costs, as the company will use the resources of the
host country. In addition, the company should make its in-store
experience for customers better. For instance, pictures in the stores should
be replaced with new ones, billboards and posters showing the months
theme should be introduced in the stores (Mennen, 2011). Enhancing the
in-store experience for customers will make shopping to be an exciting
procedure and not boring (Assenmacher, 2012). This new marketing mix
could be effective, as the current one has not managed to achieve the
sales and marketing targets of this company


First, the consultants and shop assistants working for the Body Shop are
influential in the marketing process of the company (Pahlavanzadeh,
2011). These should therefore, be given adequate training and enhanced
product information to deal with customers better.

On the process, body Shop must ensure a reliable online presence. This is
because most men prefer to shop for beauty products online and not
physically. Currently, Body Shop does not have a big brand awareness
due to its restrictive modes of public awareness creation. Its online
distribution channels are limited. Therefore, to solve low brand
awareness, further investment in its online presence is imperative.

Physical Evidence
Physical evidence for the company should include making the in-stores
favourable to men by including more male staff. This serves to suit the
needs of both genders. Additionally, the online-shopping experience
should be made easier and more exciting for customers.
Effective customer relationship management will retain customers and
develop their relationships. Therefore, the recommended marketing mix
ensures the integration of and balance between people, technology, and
process. The inclusiveness of these will result in profitability and
customer loyalty for the company (Pahlavanzadeh, 2011).

Effectiveness of the Current CRM of the

Body Shop
Customer Relations Management involves the strategies used by a
company to obtain customers and develop long-term relationships with

Current CRM Strategy

The body shop considers customer relations as one of the most crucial
aspect in its operations. This is because the management has realized the
long-term benefits of customer retention as well as customer
commitment. The current body shop CRM aims at developing and
managing the relationships between the company and the customers and
other stakeholders. The strategies entail use of mechanisms such as
technology in organizing and coordinating business processes particularly
those involved in marketing of the products. The aim of the Body Shop
CRM is to attract new customers, retain the existing customers, and
entice customers who have ever used their products to start using them
again. Moreover, the Body Shop hopes to make use of CRM in reducing
its operational cost by decreasing the need for excessive use of other

marketing strategies (Berndt & Brink, 2004).

The company has realized that the loyalty of customers is critical for the
success of their business. However, the company needs to dedicate their
business to meeting the companys financial needs and the needs of the
customers. Moreover, The Body Shop continues to protect the
environment to ensure that the needs of the current society are met
without compromising on the needs of the future generations. Other
strategies that The Body Shop uses to acquire and retain customer include
taking corporate social responsibility through its stand against animal
testing, supporting community trading, defending human rights, and
protecting the environment.
The Body Shop follows three phases in implementing the CRM. The first
phase entails acquisition of the customers. The Body Shop acquires new
customers through use of strategies such as contact management, webbased CRM, selling of quality products, and fulfillment. The second
phase entails enhancement. The Body Shop makes use of strategies such
as web-enabled CRM and other customer service tools to enhance the
quality of services. The company has hired sales representative and
specialists in different specialties to enable them identify and meet the
need of the current customers. Moreover, the company uses social
networks such as Facebook to offer consultant services on their products
(Berndt & Brink, 2004).
The third phase entails retaining the existing customer. The Body Shop
has CRM software and other databases that enable it to recognize and
reward those customers who have remained loyal for a long period by
giving those offers and discounts. The Love Your Body Rewards is one of
the groups through which The Body Shop identifies and rewards loyal
customers. Moreover, thee databases enable The Body Shop improve its
target market as well as develop appropriate marketing initiatives
(Berndt, & Brink, 2004).

Ineffectiveness of Current CRM

The Body Shop CRM is not working appropriately. Although the
websites attract several users who eventually start buying from The Body
Shop, The Company has not been making adequate profits especially in
the recent past. This is due to excessive use of activities meant to enhance
corporate social responsibility and excessive use of offers and discounts.
Moreover, the websites lack important information that cosmetic
customers seek for while deciding whether to buy a product.

New CRM Objectives

The current CRM requires improvement and alterations in some areas.
One of the objectives should aim at improving the rewarding systems.

The time sensitive offers by The Body Shop creates a notion that the
company is manipulating its customers. Another objective should be
improving on the time scale for the offers since the current period for the
offers is at times too short. Moreover, the discounts are at times too high,
and should be decreased to avoid the customers doubt the quality of the
products. Another objective should focus on changing the communication
strategies to increase the sales. Although The Body Shop has been using
emails to inform their customers of their existing products, the
descriptions given are too shallow. Moreover, their website lacks in-depth
descriptions of products. Most cosmetic companies use their websites to
teach different aspects on how the body functions, which has attracted
customers. The several offer messages sent to the customers through the
phones create a sense of desperation on the side of the company.

How the objectives will be achieved

The new of the company should focus on creating the idea of the unique
effectiveness of their products. Moreover, the company should increase
the use of media through advertisements. By enhanced use of emails, the
company will be able to connect appropriately with the customers,
identify their needs, and manufacture products that meet their needs.
Using emails and websites to educate the customers will make them
informed of the different products and increase their willingness to buy.
The company can reorganize their offer schedules and make offers during
certain periods such as festive seasons. (Lindgreen, 2004; Sumit &
Chaudhuri, 2005).

Supporting the New CRM Strategy

Using the 4Ps of Marketing Mix
The new CRM can be supported by the four Ps, which include Product,
Promotion, Place, and Price. By using websites to demonstrate the
effectiveness of their products, the Body Shop will be able to convince
customers that the price of the products is worth. This is more so in India
where people view the products as too expensive (Berndt & Brink, 2204).
Product: The Body Shop should ensure that the quality of their product
is retained. Moreover, the company should avoid overusing offers and
discounts to market its products. This is because this strategy is creating a
bad image of the company.
People: The Company should thus focus on educating the customers
about the products. This could be through use of their online consultants
who can post materials related to the companys products using simpler
language (Lau & Seetner, 2011; Lindgreen, 2004).
Place: The company can use google map to enable customers locate

places where their shops are located.

Promotions: Moreover, promotions should be used moderately especially
in areas with much competition. The promotions should be strategic and
aim at demonstrating the uniqueness of The Body Shops products as
compared to those from competitors (Mennen, 2011).

The Body Shop Marketing Plan

Business objectives can be defined as the stated and measurable goals
that a company comes up to enable it achieve its aims. The business
objectives depict the future of any company. Moreover, the objective
should be measurable, specific, time specific, realistic and agreed upon
by the major stakeholders in a company. The business objective of any
company can be considered as its statement of purpose (Epstein &
Yuthas, 2009).

Current Market, Customer, and Industry

The objectives of The Body Shop are mainly asked on the conviction that
the success of a business is determined by how a company treats the
environment and people, especially the less fortunate (Sumit &
Chaudhuri, 2005; Marsh, 2001). Currently, the marketing strategy focuses
on the products as being natural and earthly. The major customers are
women since most of the products serve the needs of women. However,
there are some products meant for men. The cosmetic industry is
becoming more diverse and competitive due to the increasing number of
cosmetic shops in the market. Moreover, the number of men using
cosmetics has increased. Most cosmetic companies are focusing more on
retaining their customers as opposed to creating new ones (Marsh, 2001).
One of the major objectives of The Body Shop is to involve itself in
activities aimed at bringing change to the environment and the social
lives of the society. This objective targets the society. Moreover, it will
enable The Body Shop gain an image of a caring company. Current
marketing objectives have not been very successful.

New Market Objectives

The new Objectives should focus on the 4Ps of the marketing mix. The
companys objective should be to meet the 4Ps in a way that attracts the
groups targeted by its products. The company should consider if their
products meets the needs of the target group. The company should focus
on attracting young customers and retaining them. Therefore, the
marketing strategies should be more youth-oriented. This is because the
company is making plans to expand its market in addition to increasing
the profitability of its business operations. The main objective here

should be ensuring that the products manufacture reflect the needs of the
consumers. The other objective should focus on the price. If product
manufactured is of good quality, it will be easy for the company to fix
competitive prices. The company should consider fixing the price
depending on location of the store. Moreover, the company should
identify the amount of money the target group is willing to pay and
beware of the competitors price (Lindgreen, 2004; Berndt & Brink,
2204). The overuse of promotions has created a negative notion about the
quality of The Body Shops product. Therefore, the company should
consider marketing strategies that attract the target group, which are the
Youths. The promotion should thus include activities such as sponsoring
beauty shows and sporting activities. Social Network is another
marketing strategy that should be used to attract young people. Moreover,
their websites should be more detailed to orient the customers to different
products. Additionally, advertisements using bill boards television and
magazines should be enhances (Lau & Seetner, 2011).
In the franchised shops, the company should enhance selective
distribution. Different people from different regions prefer varying
products. Therefore, the company should identify the varying needs of the
customers in different localities. Moreover, the company should carry out
a study to find out the distribution of their customers and locate their
distributors appropriately (Berndt & Brink, 2204). Hence, the company
requires improving on the strategies of making offers to avoid it
appearing too desperate. The offers should be reasonable and should last
for longer periods to ensure the customers enjoy them. Currently, the
offers are short lived and most customers complain that such offers are
unreasonable (Lau & Seetner, 2011).

A Marketing Budget to Achieve the New

To achieve the new objectives, The Body Shop should consider altering
its budget. The company should spend about 4% of its gross income on
the development and maintenance of the IT including the websites,
telecommunication, and databases. The databases should be used to
collect customers feedback. The company should consider reducing its
spending on offers and environment renovation programs. Though
corporate social responsibility is an appropriate tool for Marketing, The
Body Shop has been overspending on its projects aimed at improving the
environment. The company should thus spend about 3% of the gross
revenue. Moreover, some of the projects that are ineffective should be
disregarded. The promotions should be more logical. For example, the
company can use a strategy such donating about 1%, for every purchase

made at a certain price to the charity and environmental organizations.

This will enable the company make profits and conduct community
projects (Cathy & Caryn, 1999). This is because customers will be
willing to buy when they realize that their purchase contributes to
donations. This campaign should cost the company about 2% of the gross
revenue. Other forms of marketing should include billboard
advertisements, advertisements through the magazines, social networks,
television and sponsoring of activities should take about 3% of gross
revenue. Therefore, the company should focus on marketing strategies
that benefit both the company and the stakeholders (Pahlavanzadeh,
2011). During the sponsorship activities such as sports, the company
should use banners. The company should also consider organizing
conferences to create awareness on the environment, a method that
should not take more than 1% off gross income. Moreover, their website
should include educative articles on the environment. This will reduce the
cost use in environmental issues. The total revenue use in marketing
should not exceed 10% of the gross revenue (Berndt & Brink, 2004;
Epstein & Yuthas, 2009).

Evaluating the Perfomance of New

Marketing Objectives
After implementing a marketing strategy, it is important to measure its
effectiveness and make changes where necessary. The monitoring and
evaluation should entail analyzing the sales and comparing the changes in
sales with the marketing cost. The effectiveness of the new marketing
strategy can be assessed using various strategies. One strategy should be
through measuring determination of change in sales following
implementation of the different marketing strategies. Measurement
should entail comparison of the performance with the different marketing
strategies. Moreover, the management should collect data and analyzing
it. Analysis of the performance can also be done through numerical
counting and reporting. This can be through determining the number of
people visiting the company websites and the different stores. Moreover,
the performance can be measured through comparing data on the number
of people visiting the store and the sales made on daily basis. To assess
the online sales, the company can install software to analyze data through
comparison of the number of visit and the number of online purchases.
Moreover, the company can carry out online surveys to find out the
number of customers who are triggered to make purchases by the
different companys marketing strategies (Epstein & Yuthas, 2009).


Customer Relations Management entails the strategies used by a

company to obtain customers and develop long-term relationships with
them. Currently, The Body Shop Mainly depends on offers to attract and
retain customers. However, overuse of offers has created a negative
attitude about this company. The new marketing objectives should focus
on other strategies of attracting customers without appearing desperate.
Such strategies include positioning of their franchises, advertisements,
and customer education. The company can continue giving offers but they
should be logical and reasonable. This will make the customer realize that
the products are of quality and worth the price. The Body Shop marketing
budget should be considerate to ensure the company does not continue
reducing its profits. Moreover, focusing on creating environmental
awareness using online techniques such as websites will enable The Body
Shop spend fewer funds in conducting corporate social responsibility and
increase profits.

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