CONTENTS
EXECUTIVE SUMMARY COMPANY SUMMARY DISTRIBUTION CHANNELS COMPETITOR ANALYSIS SWOT ANALYSIS MARKET OPPORTUNITY POSITIONING IN MARKET CONSIDERATIONS THE NEW STRATEGIC INTIATIVE TARGET CONSUMER OMNI-CHANNEL STRATEGY COMMUNICATIONS & PROMOTION PLAN FINANCIAL PLAN
EXECUTIVE SUMMARY
Giella is excited to announce the launch of their new self-titled mobile app that would reinvent the way people shop for cosmetics. This app utilizes the br and’s specialty of customized cosmetics, constr ucting a new and innovative platfor m for user s to shop for makeup in a completely bespoke experience. Through the use of colour identification technology, user s would be able to upload a photo on to the Giella app, specify the exact shade of colour, and be able to create and order their own customized foundation, eye shadow lipstick and more. Customer s will be delighted to browse through the different photos uploaded by other user s and be able to like, discover and buy different shades from pictures captured from all over the wor ld. Not only will this initiative increase br and, product and ser vice awareness, Giella would also be able to gain insight into consumer preferences by obser ving the photos uploaded and best selling shades.
COMPANY SUMMARY
ABOUT GIELLA The name “Giella” means “Jewel” in Italian. It is also the name of the per son who has developed this product line through year s of wor king with the color and image conscious clientele of the exclusive Vidal Sassoon Salons. Within the Vidal Sassoon Salons, Giella has become synonymous with exper t custom blending solutions. Giella has also mar keted this concept in Henri Bendel in New Yor k City and is now in 15 locations in the US. Giella does not believe in animal testing. She stands behind her products as being the finest in quality, texture and shade selections. All GIELLA products are non-comedogenic, fr agr ance-free and allergy-free. They use a proprietar y Color Specific Analysis System to analyze and customize a suite of products selected to complement the hair, eye and skin color of each client. Their makeup can be blended with skin care ingredients to maximize benefits and to meet the needs of their clients.
MISSION “Strive to maximize the natural beauty inherent in each of us by enhancing natural colors and features with the perfect makeup blend. We strive to use the best, natural ingredients and custom blend skin care into our makeup.”
PRODUCTS GIELLA offer s custom blends cosmetics including eyes, lips and cheeks; a complete line of skin care; and a health-friendly nail enamel. They can create your perfect shade of lipstick based on your hair, eye and skin tone or they can match your favorite discontinued shades of cosmetics on the spot within minutes.
DISTRIBUTION CHANNELS
BRICK AND MORTAR Giella cur rently oper ates in 9 physical locations in 5 states across the US, all of which are par t of a bigger beauty and hair salon business. Salons have long offered the added ser vice of having a professional makeup ar tist do the customer’s makeup as par t of the idea of the customer needing to have their hair done for a special par ty and event. This way, the salon would be a convenient one-stop shop to get both hair and makeup done at the same time. Giella offer s a unique experience by tailor making cosmetics to suit the customer that they are wor king on. In these locations, the Giella makeup professional would be able to whip up a bespoke blend of cosmetics that would suit and flatter the customer perfectly within minutes. However, as they do not have their own physical storefront, Giella heavily relies on the salon’s existing customer s in order to spread awareness of their br and. One standout ser vice that the br and offer s is their discontinued match. This allows customer s to bring in any cosmetic (be it foundation, powder or lipstick), and Giella would be able to match it exactly.
E-COMMERCE In addition to their physical locations, Giella has a website that allows for online purchases as well. However, unlike the in store experience, there are no professionals available to match the perfect shade for your custom blend. Customer s are still able to customize their cosmetics on the website, with choices of shimmer, additives (oil control or moisturizing for example), cover age and aroma. With the online site, customer s would only get to choose from the existing shades in Giella’s product assor tment, and are not able to have a tr uly unique bespoke product. The online site also cater s for the discontinued match ser vice. However, customer s would have to send their original tube, container or bottle to their address, which would take a much longer time for customer s to receive the finished product.
COMPETITOR ANALYSIS
DIRECT COMPETITION Prescriptives launched in 1979 with progressive, precise and individualized skincare and make up products. The sleek packaging and science-bases positioning it revolutionar y. Prescriptive revolutionized the way women chose and wear make up with the couture, ultr a-per sonalized concept of Custom Blend. Foundation is customized by shade and cover age level, with additives for specific skin need. This ser vice is still available through registered their recipes at Prescriptives.com. The Custom Blend ser vice involves wor king with a makeup ar tist to create a precise foundation, concealer, lip-gloss and/or powder—specifically created to match your skin tone.
BESPOKE TREND In a wor ld where we are sur rounded by mass produced goods, with the same popular store br ands in ever y mall, it gets harder to differentiate your style from other s. That sense of individuality and uniqueness is exactly what has been missing from the high street offerings and designer goods that are copied as soon as they are unveiled. In the past few year s, customization has taken centre stage and customer s are looking for something that reflects them and their tastes.
Bespoke items are not a new concept, it has strong roots in one of London’s most prestigious streets for menswear tailoring: Savile Row. In the recent year s, bespoke products have been making a come back, with many br ands and stores jumping in on the bandwagon. Last year, London based depar tment store, Har rods, presented a series of exclusive products and bespoke ser vices in store to celebr ate the luxur y cr aftsmanship across various br ands. The ‘Made With Love’ campaign included ser vices such as monogr amming on Mulber r y bags, exclusive embossing for Gucci and featured the wor ld’s fir st La Per la made-to-measure lingerie collection. This year, the depar tment store held a 3-day celebr ation for customization called ‘Made To Measure Spring/ Summer 2015’. Open to menswear only, the event introduced 24 master s of customization from br ands such as Tom Ford, Br unello Cucinelli and Gieves & Hawkes. Fur ther more, Har rods has also debuted a bespoke fur nishings section in their stores, allowing customer s to order customized handmade cur tains, wall upholstering, r ugs, sofas and more.
In March 2015, makeup br and ‘Eyeko’ launched their new Eyeko mascar a ser vice in Har vey Nichols. The br and, which creates products only for eyes, and for the last few year s has teamed up with London’s fashion it gir l Alexa Chung, opened the fir st bespoke mascar a bar. Customer s would be allowed to discover and tr y different bristles and mascar a for mulas (to either grow, thicken, lengthen… etc) to find out which one suits their wants and needs the best. The bespoke mascar a bar offer s over 100 different br ush and for mula combinations, which comes packed in a special monogr ammed box. This bar gener ated a lot of buzz and press, creating an interest in bespoke makeup as women star t to realize that no two faces or skin are the same.
With a cur rent added interest in all things bespoke, especially makeup, Giella could capitalize on this and star t promoting their unique bespoke cosmetics ser vices – especially the ability to recreate any discontinued product from any br and.
“In a wor ld where ever ything is available, a tr uly handmade and bespoke product is ver y hard to find. A bespoke ser vice places customer s at the centre- their desires are handmade for them.” - Loredana Tar sia (Creative director of Lingerie d’Elia)
EYEKO BESPOKE MASCARA BAR
SAVILLE ROW TAILORS
BESPOKE FURNISHING AT HARRODS
MARKET OPPORTUNITY According to the multichannel merchant website, Chipotle was listed as one of the top excellent examples of omnichannel best pr actices. The food chain utilizes multiple channels to enable customer s to place order s wherever they are. Customer s are now able to make an order in store, online and on their mobile app to order on the go. Likewise, many successful omnichannel retailer s have embr aced the use of brick and mor tar stores, online sites and mobile apps as a sales channel.
Last year, Business Insider repor ted that mobile retail spending in the U.S. had increased 188% in 2013 to reach almost $60 billion. Comparing it to the over all online retail sales for that year, it was calculated that mobile shopping accounted for 23% or 1/4 of all e-commerce dollar s. Statistics show that by 2018, mobile retail commerce sales are expected to amount to $133 billion. Mobile apps have broken geogr aphical bar rier s and consumer s are star ting to enjoy a seamless buying experience with the many apps available for many brands today.
As technology and phones improved, the number of br ands creating a mobile app has increased. Today, the beauty industr y has numerous applications with meaningful and unique experiences. Big beauty companies such as Sephor a and OPI have launched their own apps, allowing user s to shop using their mobiles and tr y on new nail colour s on vir tual hand models with different skin shades.
A recent edition to the beauty app wor ld is NailSnaps, a kickstar ter funded app that allows user s to tur n their instagr am photos into nail ar t. The process is simple; user s are able to choose a photo from their phone galler y, instagr am or facebook accounts or take a photo on the spot and upload it to the app. From there, they would ar r ange the picture accordingly in order to create a unique customized set of nail sticker s. They then get the choice between the regular or petite size, and the order is placed in their car t. Each nail sticker set is priced at $19, which is equivalent to the price of getting nail ar t and decor ations done in regular nail salons. Creating your ver y own bespoke nail ar t, coupled with an over all easy usability and purchase, NailSnaps reached their kickstar ter goal within a few days and gained more backer s and money than they had originally set out to achieve.
While there has been a recent rise in beauty apps that scan the user’s face and vir tually tr y different shades or colour s on them, many of them are limited to only one br and or a few colour s. ModiFace, for instance, uses a sophisticated facial recognition technology and provides a variety of options, allowing user s to tr y out different hair styles, colour s and makeup looks. As stated, they are limited to the number of options available; fur ther more, the app does not have an in app purchase function. Additionally, not many br ands have the ability to make any shade under the colour of the rainbow for almost any cosmetic product. This is where Giella would enter the mar ket.
POSITIONING IN MARKET USER GENERATED CONTENT
beautiful me
modiface nail snaps
NO PURCHASE
L’oreal makeup genius
opi
think dirty
pretty in my pocket
PURCHASE
beautylish
keep shopping
sephora
glamsquad
beauty bar
NON USER GENERATED CONTENT For the perceptual map, the different apps were divided into sections based on whether or not it has user gener ated content and if there are any in app purchase ser vice available. As Giella is a cosmetics br and, only beauty apps were analyzed and separ ated to see which areas were the least satur ated. In recent year s, apps with user-gener ated content have been on a rise, mainly due to the vast improvement in phone technology. Apps such as Modiface and L’oreal’s makeup genius bar allows user s to scan their face and tr y on different shades of makeup in order to identify which shade would be more flattering towards their own skin tone. However, while these apps are ver y useful and enables user s to know which products they should purchase, buying from the application itself is not possible. According to the perceptual map, the least satur ated mar ket falls under the ‘user- gener ated content’ and ‘purchase’ section. With less competition, Giella would be able to focus on this area without much competition.
CONSIDERATION
Beyond the beauty industr y, it is impor tant to consider the best pr actices and failures of other apps in order to lear n from them and under stand what app consumer s are looking for. In this age where there are over 1 billion smar tphone owner s in the wor ld, mobile engagement is key to growing br and tr ust and value. According to an ar ticle about the best pr actices for mobile consumer engagement, app developer s should create a rich and cur ated experience with an emphasis on per sonalization.
A recent Forbes ar ticle on drug stores highlighted CVS Caremark and Walgreen as the highest regarded retail mobile apps. The two apps acts as an extension of the brick and mor tar store and allows users to get refills, make orders to collect and look at any in store deals. The highly convenient aspect of the two apps, allowing them to personalize their account and add information about their prescriptions in, makes it one of the top mobile retail apps today.
Another retailer doing well with their mobile application is Amazon, whose mobile site and app have been a huge success and is key to maintaining its dominance of e-commerce and extend its mar ket reach. One of the key reasons why their app has been such a success can be attributed to the ‘one shopping basket across all platfor ms’ str ategy. Amazon’s shopping basket is designed so that it synchronises across its desktop site and mobile platfor ms. When something is added to their shopping basket on the desktop site, it would immediately be added to the app as well. The company took into account the way people researched and switched between different channels while purchasing an item, and made this feature to allow for a smooth tr ansaction. In addition to that, their consistent design across mobile site and apps, as well as the ease of repeat purchases through their popular one click payment method has contributed to its huge success.
While there are many successful apps that almost ever y smar tphone user is sure to have on their mobile device, there are some that have failed and has affected the customer’s opinion and tar nished the br and’s reputation and image. Giant Eagle is one such example. GE is a super mar ket chain with stores in the U.S states of Pennsylvania, Ohio, West Virginia, Indiana and Mar yland. While the company hoped that their app would make refilling prescriptions and making check out easier, according to the customer reviews on the itunes store, the app doesn’t help to simplify or shor ten user experience. As Forbes stated in their review on the Giant Eagle app, “more connection points with a consumer doesn’t make their process easier”. The app itself was said to take up too much space on a phone, with a size of almost 40 MB (the aver age size of an app is 23MB). To add to user’s fr ustr ations, they had multiple password troubles, which made the whole process inconvenient and fr ustr ating.
With the new plan to enter Giella into the mobile retail area with an app, both the best pr actices and app failures of these companies should be taken into consider ation during the app planning and development stages.
THE NEW STRATEGIC INITIATIVE
NEW STRATEGIC INITIATIVE KEY OBJECTIVES -
To engage consumer s through user-gener ated content driven app
-
Increase br and, product and ser vice awareness
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Promote high levels of social media engagement
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To gain insight into consumer preferences by obser ving best selling shades
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To increase consumer loyalty through app
RATIONALE The new Giella mobile app initiative involves the integr ation of their unique ability to create any shade of cosmetics, as well as the bespoke trend of customer s getting to choose their own unique products. This results in an innovative social bespoke experience that puts user s in the seats of beauty professionals.
Giella’s custom blend cosmetics has been around since 2001. While the br and gained much press cover age in the fir st year of its release, hype around the br and has since died down, as evident from their social media channels, which lacks inter action between the company and their consumer s. Additionally, when searching under the tag words of ‘bespoke makeup’ on search engines, Giella does not appear within the fir st few pages of the search. The br and also lacks any press or media presence since it’s launch in the ear ly 2000s. With the introduction of the new and innovative Giella mobile app in the peak of the bespoke trend, the public would be reintroduced to the company.
The app wor ks as a user-gener ated content platfor m, allowing customer s to take or upload any photos on the app. From the picture, they would then choose which shade exactly they are looking for, before specifying if the colour is for a foundation, powder, eyeshadow, lipstick… etc. User s would be able to customize it even fur ther by choosing different proper ties for each product. For example, user s would be able to choose the cover age, aroma, shimmer or any additives they would want for their ideal tube of lipstick. Customer s are then able to purchase the product directly from the app itself. The photos they upload would be seen on their profile and on the public browsing area, where user s are able to see photos uploaded by other s and even choose to purchase the same shade as well. If a customer is looking for a gener al colour, but isn’t sure which exact shade they are looking for, they would be able to browse through these photos via the app’s search function. Any shades or products that the user is considering purchasing, but is not ready to buy it just yet, could be added to their wish list, which is easily accessible.
To cater to a greater audience, the app would be available for download in both the Apple itunes store and the Google play android store. Pricing wise, it would be free for download, to allow user s the oppor tunity to play with the app before making a financial commitment or purchase towards Giella.
CUSTOM MAKEUP APP
Upload your favourite picture to the App.
Choose a specific color you want from the picture.
Pick between face, cheeks, eyes, lips or nails.
If Giella has product in that shade, they recommend it. But if not: CUSTOM SHADE.
Zoe Sugg
Zoe Sugg
JOINED 1Y AGO
JOINED 1Y AGO
560 FOLLOWERS
560 890 FOLLOWERS
4444
LIKES
VIEWS
4444
890 LIKES
VIEWS
ITEMS
ITEMS
ORDERS
ORDERS
FOLLOWING
FOLLOWING
FOLLOWERS
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PROFILE SETTING
PROFILE SETTING
ACCOUNT SETTING
ACCOUNT SETTING
GIELLA Mineral Powder
GIELLA Eye Pencil
GIELLA Lipstick
GIELLA Mineral Powder GIELLA Nail Polish
GIELLA Nail Polish
GIELLA Eye Pencil GIELLA Mascara
GIELLA Mascara
GIELLA Lipstick GIELLA Eyeshadow
GIELLA Eyeshadow
View all the photos you uploaded and liked.
Need time to think about it? Put it to wishlist.
Browse and click like for color inspir ation.
Search for specific shades.
TARGET CONSUMER
THE MILLENNIAL The Millenial gener ation was bor n between 1980 and 1999 and is char acterized by their tech prowess and social connectivity. The focus of the App will be female Millennials, ages fifteen to thir ty-four, who are college educated .
- Young Diger ati - Up- and- Comer s - Innovator s - Experiencer s
As of Januar y 2014, eighteen to twenty- four year olds spent nealy two-thirds (64%) of their online time using smar tphones (54%) and tablets (10%). Women spent more of their online time accessing via smar tphones (54%) than PCs (32%). The eighteen to twenty-four age br acket emerges as the most mobile-only, at 15 % of the connected population. In addtion to being socially connected via their mobile smar tphones, Millenials are changing face of consumer purchasing behavior.
The Giella App intiative aims to strengthen Giella relationship with Millenials by providing an inter active, technology driven app which encour ages social engagement, mobile commerce and user- gener ated contentall key components which enable the Millenial shopping experience.
OMNI-CHANNEL STRATEGY
Omni-channel is a multichannel approach that seeks to provide the customer with a seamless shopping experience through all of its platfor ms. Cur rently, Giella has 9 physical locations in various hair and beauty salons across 5 states in the U.S., as well as an e-commerce website. All of these platfor ms would have to wor k together in order to provide the customer with a simple, cohesive and convenient shopping experience.
Though not exactly identical, Giella’s mobile app would share a similar design so that user s would be familiar and comfor table using either one. The main colour s and design of the app keeps with the ver y minimal look from the site. In addition to the layout consistency, the shopping car ts and purchase histor y between the desktop site and mobile app would be synched, making it more convenient for customer s to shop on either platfor m at any time. Fur ther more, user s would be able to easily save their custom blend product infor mation on their profile, which also synchs to ever y platfor m. They would also be able to go into the physical locations and show the Giella makeup professionals the blend infor mation, allowing them to create it in the store on the spot. With all of these platfor ms wor king seamlessly together, customer s would be able to tr ansition easily from the physical sites, online store and the mobile app.
SWOT ANALYSIS
S
trengths
- Access to new mar ket
O
ppor tunity
- Growing new mar ket
- Global availability
- Demand increase by new application
- Innovative idea
- Customer moving to online and
- Stay in touch with the customer
mobile shopping - Improving and developing the App
W
eakness
T
hreat
- Security issue
- Similar app features
- Lack focus on single platfor ms
- Large increase in beauty apps
- Developer need time to re-lear n
- Fast- changing, cosistent
as new oper ation system
technological advances
COMMUNICATION & PROMO PLAN
GIELLA APP COMING SOON...
In prepar ation for the Giella App to launch, Giella will implement extensive promotion across all social media platfor ms including: Facebook, Instagr am, Twitter, YouTube and Pinterest. These platfor ms will showcase sneak peeks of the soon to be released App in order to gener ate customer interest and excitement.
Newsletter, E-receipts, in-store receipts and shipping confir mation e-mails will feature a promotion to prepare pre-existing Giella consumer s for the release of the new App. This encour ages existing Giella customer s to experience thy new way to shop.
#Giellaapp launches tomorrow!! Be the rst to join the new custom cosmetic shopping experience. Sign up now at Giella.com to request an invite code.
FINANCIAL PLAN
Expenses (estimated) Development team Visual designer In app purchasing capability
$20,700 $1,350 $3,000 Amount comes from the complexity of the in-app purchasing Taking the content to a remote access point, which would allow you $3,000 to update your app with XML files instead of raw code changes Social media sharing sites such as Facebook, instagram and $500 pinterest $100 Ie: Google Analytics Additional costs due to different screen size and speed, which $940 requires new designs $99 Amount paid to Apple per year $99 Amount paid to Google per year
Web services Share capabilities SDK Iphone, iphone 6+ & ipad compatible Itunes store Google android play Total
$29, 788
To deter mine the estimated cost of the app, a look into an app’s financial str ategy with similar photo taking and purchasing functions was refer red to. We looked into Nail Snaps (mentioned previously in ‘mar ket oppor tunities’), and noted the financial steps they took in order to create their app. According to their site, the development team costs about $20,000, while the visual designer for the app cost around $1,300. We took both of these costs into consider ation for our own app as both Nail Snaps and the potential Giella app has similar ser vices and functions. The other costs were outlined from an ar ticle written by a professional app developer who briefly described the essential and add on ser vices that apps could offer, and how much they cost. In app purchasing, was specified to cost from about $1,000 to $3,000, depending on the complexity of it. Due to the many options that Giella offer s as well as the colour recognition technology, the estimated cost of developing this product totalled to almost $30,000 (USD).
Apple
Average revenue per app
$1,125
$4,000
Revenue per download
$0.19
$1
According to an ar ticle on Forbes, the aver age revenue an app gets is around $1125 for Google and $4000 for the Apple store. This, however, is only solely based on the number of downloads for the app itself, without the additional sales and profit to be made with Giella’s in app purchases. All products sold on Giella’s app would be the same as the physical locations and the online site. All custom blended shades would follow the same price point as Giella’s ‘discontinued’ ser vice. The following is taken directly from Giella’s website.
PRODUCT Foundation Powder Blush- cream Blush- powder Bronzer Nail Polish Lipstick Lip Gloss Eye Shadow Eye Pencils Lip Pencils
PRICE $50 $40 $30 $40 $40 $25 $30 $30 $30 $30 $30
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CLARA SIM JENNY CHU JOJO LIN FASM 415 NON-TRADITIONAL RETAILING