Kitty-final Bisiness Strategy

Business Strategy

Competitive advantage

The body shop has held the advantage over rivals on social wise. For many years, its campaigns about human right issue and protection for animal and environment have become as famous as its product. The customer get involve with the brand by sharing the believe which is not only the quality of natural product they buy, but the believe and philosophy as well.

Cost Advantage

The body shop has been supporting community-based enterprises. It aims to help build livelihoods and introduce educational and health benefits to many suppliers and their communities, also to explore trade-based approaches by supporting sustainable development through sourcing ingredients and accessories from socially and economically-marginalised producer communities.


The benefit from this social-sustainability building is The body shop could have plenty of exotic raw materials in lower average cost and also lower labour cost.


Moreover, The Body Shop has another strategy to cut the cost of packaging, which is offering its customers a refill service. But fewer than 1% of customers globally brought their bottles back. Instead, The Body Shop is turning its attention to producing recycled packaging, even though there is energy cost during the process,
the overall benefits are still positive.



Market dominance

The Body Shop has achieved the market dominance through 2 factors, the internal growth and acquisition:

Internal growth

All of the body shop’s staffs believe in the ethical idea behind the brand, which help holding the whole organization together. However, The Body Shop’s employees are encouraged to speak out on issues that concern them. This process of staff consultation enables the Body Shop to survey and test its mission statement against its company performance, as well as identify employee needs and future company initiatives


Acquisition

Since The body shop has been taken over by L’Oreal, there has been more opportunity for the brand growing more quickly and widely. However, the brand has won the fight to convince customers the brand’s standards have remained the same by an announcement that L’Oreal has not tested finished products on animals.


Jean-Paul Agon, Chief Executive of L’oreal, was quick to dismiss any idea of not being as dedicated to the cause as their new venture, Body Shop, stating: "The big ambition in terms of animal testing is to make animal testing disappear completely forever in the beauty industry" *(*Financial Times interview)

Citing the way around animal testing as researching alternative ways of testing the chemical ingredients, L'Oreal are at present looking into a technique to use artificially produced human skin and have stated that they will continue to "invest like crazy on alternative methods in the future".




New product development

To keep ahead of rivals, The body shop fights back by investing in new product development, store design and marketing approach. Body Shop is launching new product aimed at a variety of categories, new series of body product, for example, the body butter, which have been launched since 2008, has been a big hit in the market. The body shop “ new design” has been implemented on the appearance of the stores, the changes gave more contemporary look, flexibility that help promoting products more effectively, the idea minimum the cost by recycling old shop’s furniture. Moreover, in order to get closer to targets, the direct sales arm called the body shop at home has been launched. Lastly, to keep customer’s loyalty, “Love your body” customer card has been promoting since 2004.




Expanding

After L'Oreal taking over, The Body shop has still, been focusing on maintaining the brand’s core competency, also looking for more global expanse.

There are plans to develop the Body Shop brand in countries such as Brazil, Argentina and China, which are fast growing environment consumer market.
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The Chinese cosmetic and toiletry sectors has recorded sales growth into double figures. This gives China one of the largest industry growth rates in the world and has helped secure a position as a world-wide hub for the cosmetics industry.

Likewise the Brazilian beauty market looks set to become the world's third largest beauty market by 2007. And in Latin America as a whole, like-for-like sales growth came in at 16.2 per cent to reach €481m in the first 6 months of this year

Having recently launched in India, L'Oreal is hoping that the Body Shop brand will more than double in size in the coming years, estimating that the number of stores will rise from 2,000 to 5,000 in over 100 countries. .*

(*http://www.cosmeticsdesign-europe.com/Financial/L-Oreal-announce-Body-Shop-expansion-into-international-markets)


The company also concerns the proposal to have more store in South and North Asia and Eastern Europe.