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Classic Case Interpretation of Market Research in Cosmetics Retail Industry

2024-07-18 08:59:49 Source: Champu Consulting Visits:0

1. Introduction

The cosmetics retail industry is a dynamic and innovative industry. With the diversification and personalization of consumer needs and preferences, cosmetics retail enterprises are facing the continuous changes in the market environment and the continuous challenges of competitors. In order to stand out in the fierce market competition, cosmetics retailers need to have an in-depth understanding and analysis of the market in order to develop effective strategic decisions and marketing programs. Market research is an important means for cosmetics retailers to obtain market information and insight. By systematically collecting, sorting, analyzing and interpreting market-related data, market research can help cosmetics retailers identify market opportunities and threats, assess market needs and potentials, understand consumers' behaviors and attitudes, and analyze competitors' strengths and weaknesses, as well as testing and evaluating the effectiveness of the marketing mix of products, prices, channels and promotions.

The process and methods of market research vary according to different purposes and situations, but generally include the following steps: determining the objectives and scope of market research, designing market research programs and tools, selecting and implementing market research methods and techniques, collecting and processing market research data, analyzing and interpreting market research results, and writing and presenting market research reports. The methods and techniques of market research are divided into two main categories: quantitative research and qualitative research. Quantitative research refers to the measurement and analysis of large amounts of data through mathematical and statistical methods to obtain objective and quantifiable results. The common methods of quantitative research are questionnaire, experiment, observation and so on. Qualitative research refers to the description and interpretation of a small amount of data through non-mathematical and non-statistical methods to obtain subjective and in-depth results. The common methods of qualitative research are interviews, focus groups, case studies, etc.

In order to better understand and master the process and methods of market research, this paper selects three classic cases of market research in the cosmetics retail industry, namely, L'Oreal, Estee Lauder and Perfect Diary. From different angles and levels, it shows the purpose, method, process and results of market research, as well as the guiding role of market research in the strategic decision-making and marketing of cosmetics retail enterprises.

L'Oréal -2. market research case

L'Oreal is a French cosmetics company with a number of well-known cosmetics brands. The development history of L 'Oré al in the Chinese market can be divided into three stages: the first stage is from 1997 to 2003. L 'Oré al is mainly high-end brands, mainly for high-income consumers in first-tier cities, and sells through counter channels. The market share is low, but the profit is high; the second stage is from 2004 to 2010. L 'Oré al started to expand its market to second-tier and third-tier cities, selling through supermarkets and online channels, the market share has increased significantly, but the profit margin has declined; the third stage is from 2011 to the present, L'Oréal has focused on a multi-brand strategy, covering the Senior high school low-end market, covering all regions of the country, and selling through diversified channels, market share and profit margins Both maintain a leading position.

L'Oreal's success in the Chinese market is inseparable from its attention and investment in market research. L'Oréal has set up a professional market research department in China, investing tens of millions of dollars in market research every year, involving products, prices, channels, promotions, competitors, consumers and other aspects. L'Oreal's market research methods include quantitative research and qualitative research, of which qualitative research accounts for a relatively large proportion, mainly in the following forms:

(1) Home visits. L'Oréal's market researchers regularly visit consumers' families to observe and record consumers' living environment, family structure, buying habits, usage habits, inventory, satisfaction and other information to understand consumers' real needs and preferences.

(2) In-depth interviews. L'Oreal's market researchers will invite consumers to the company or a third-party organization for one-on-one in-depth interviews, through semi-structured or unstructured question and answer methods, to explore consumers' cognition, attitude, feelings, expectations and other psychological issues of cosmetics, in order to obtain the deep motivation and values of consumers.

(3) Focus groups. L'Oréal's market researchers will organize 6 to 10 consumers to participate in a topic discussion, and a moderator will guide and stimulate the communication and interaction between consumers, and observe and record consumers' words, expressions, body and other non-verbal information to capture consumers' emotions and attitudes.

(4) Neuromarketing. L'Oréal's market researchers will use EEG, eye movement, galvanic skin response and other instruments to measure consumers' brain activity, eye movement, skin conductance and other physiological reactions when exposed to cosmetics, so as to reveal consumers' subconscious and instinctive reactions.

L'Oréal's market research results provide strong support and guidance for its strategic decision-making and marketing in the Chinese market. The following are examples of the application of L'Oréal's market research results in its actual operations:

(1) According to the skin color and skin quality characteristics of Chinese consumers, L'Oreal has developed special products and formulas to meet consumers' needs for whitening, moisturizing, and anti-aging. For example, L'Oreal has launched a series of "water light needles" for Asian women, which uses water light needle technology to provide deep hydration and luster for the skin, which has been welcomed by consumers.

(2) In view of the consumption psychology and behavior characteristics of Chinese consumers, L'Oreal has adopted different market segmentation and positioning strategies to meet the different needs and preferences of consumers. For example, L'Oreal divides the Chinese market into four levels: high-end market, mid-to-high-end market, mid-end market and low-end market, corresponding to different brands and products. L'Oreal also carries out more detailed market segmentation and positioning according to the characteristics of consumers' age, gender and lifestyle.

(3) In response to the diversification of Chinese consumers' purchase channels and methods, L'Oreal has established a diversified channel system to cover different consumption scenarios and contacts. For example, L'Oreal has a layout in counters, supermarkets, online, social media, live broadcast and other channels, providing different products, services and experiences through different channels to attract and retain consumers.

(4) In response to the social responsibility of Chinese consumers and the improvement of environmental awareness, L'Oreal actively fulfills its corporate social responsibility to establish a good brand image and reputation. For example, L'Oréal has participated in the "Beautiful China" project, contributing to China's sustainable development through measures such as tree planting, energy saving, emission reduction, and recycling.

3. Estee Lauder's Market Research Case

Estee Lauder is an American cosmetics company with a number of high-end cosmetics brands. The development history of Estee Lauder in the Chinese market can be divided into two stages: the first stage is from 1993 to 2008. Estee Lauder is mainly high-end brands, mainly for high-income consumers in first-tier cities, and sells through counter channels. The market share is relatively high, but the growth rate is slow; the second stage is from 2009 to the present. Estee Lauder has started to expand its market to second-tier and third-tier cities based on multi-tier cities and through online and tourism channels, both market share and growth rate remain leading.

Estee Lauder's success in the Chinese market is also inseparable from its attention and investment in market research. Estee Lauder has set up a professional market research department in China, investing millions of dollars in market research every year, involving products, prices, channels, promotions, competitors, consumers and other aspects. Estee Lauder's market research methods include quantitative and qualitative research, of which quantitative research accounts for a relatively large proportion, mainly in the following forms:

(1) Questionnaire survey. Estee Lauder's market researchers regularly issue or send questionnaires to consumers to collect basic information, purchasing behavior, usage behavior, satisfaction, loyalty and other data through structured or semi-structured questions to understand the general situation and feedback of consumers.

(2) The experiment. Estee Lauder's market researchers regularly conduct experiments in the laboratory or in the field to test consumer responses to different products, prices, channels, promotions, etc. by controlling variables and observing results to assess the effectiveness of different marketing combinations.

3) Observation. Estee Lauder's market researchers regularly observe at the counter or in other places to understand the actual behavior and influencing factors of consumers by recording the purchase process, use process, communication process, etc.

Estee Lauder's market research results provide strong support and guidance for its strategic decision-making and marketing in the Chinese market. The following is the application of Estee Lauder's market research results in its actual operation:

(1) In response to the younger trend of Chinese consumers, Estee Lauder has launched brands and products for young consumers to attract and cultivate young consumers. For example, Estee Lauder launched the "Yueshi Fengyin" brand, which is specially designed for young consumers. The products include makeup, skin care, perfume, etc., the price is relatively close to the people, the style is relatively lively, and it is loved by young consumers.

(2) In response to the online shopping habits and preferences of Chinese consumers, Estee Lauder has strengthened the construction and operation of its online channels to increase the share and efficiency of its online sales. For example, Estee Lauder has its own flagship stores on Tmall, Jingdong, Xiaohongshu and other platforms to attract and retain online consumers by providing exclusive products, services and activities.

(3) In response to the growth of Chinese consumers' tourism consumption, Estee Lauder has strengthened the layout and management of its tourism channels to seize the opportunities and potential of tourism consumption. For example, Estee Lauder has its own counters or counters in airports, duty-free shops, cruise ships and other tourist places to attract and satisfy tourist consumers by providing professional products, services and experiences.

(4) In response to the use and influence of social media by Chinese consumers, Estee Lauder has strengthened its use and marketing of social media to improve its brand awareness and reputation. For example, Estee Lauder has its own official accounts on social media such as Weibo, WeChat, and Douyin. It publishes interesting content, interactive topics, and attractive activities to attract and influence social media users.

Market Research Case 4. Perfect Diary

Perfect Diary is a Chinese cosmetics company that owns a number of emerging cosmetics brands. The development history of Perfect Diary in the Chinese market can be divided into two stages: The first stage is from 2016 to 2018. Perfect Diary is mainly low-end brands, mainly for low-income consumers in third-tier and lower cities, and is carried out through online channels. Sales, market share is low, but the growth rate is fast. In response to the younger trend of Chinese consumers, Perfect Diary has launched brands and products for young consumers to attract and cultivate young consumers. For example, Perfect Diary launched the "Little Mustang" brand, which is specially designed for young consumers. The products include makeup, skin care, perfume, etc., with relatively low prices and relatively trendy styles, which are loved by young consumers.

In response to the online shopping habits and preferences of Chinese consumers, Perfect Diary has strengthened the construction and operation of its online channels to increase the share and efficiency of its online sales. For example, Perfect Diary has its own flagship stores on platforms such as Pinduoduo, Kuaishou, and Douyin. It provides preferential products, services and activities to attract and retain online consumers.

Aiming at the use and influence of social media by Chinese consumers, Perfect Diary has strengthened its social media use and marketing to improve its brand awareness and reputation. For example, Perfect Diary has its own official accounts on social media such as Weibo, WeChat, and Douyin. It publishes interesting content, interactive topics, and attractive activities to attract and influence social media users.

5. Conclusion

By analyzing three classic cases of market research in the cosmetics retail industry, this paper discusses the purpose, method, process and results of market research, as well as the guiding role of market research in the strategic decision-making and marketing of cosmetics retail enterprises. This paper finds that market research is an important means for cosmetics retail enterprises to obtain market information and insight, the methods and techniques of market research should be selected and adjusted according to different purposes and situations, and the results of market research should be applied and transformed according to different market environment and competitive situation. This paper hopes to provide some reference and enlightenment for the market investigation of the cosmetics retail industry.




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