LUSH Strategic Initiative by K Taylor Harman

a s tr ategi c i nitiativ e BY

Taylor Harman, Blair Salter, Tindal Anderson, Kate Walker, and Alley Walls

A STRATEGIC INITIATIVE

CONTENTS 04 12 20

EXECUTIVE SUMMARY

COMPANY OVERVIEW

MARKET POSITION

CURRENT COMMUNICATIONS

SIMILAR INITIATIVES

FUTURE COMPETITORS

LUSH COSMETICS

TARGET CONSUMER

PROPOSED LOCATIONS

COMMUNICATION PLAN

LUSHâ&#x20AC;&#x2122;S COMPETITORS

THE NEW STRATEGIC INITIATIVE

CURRENT INITIATIVES IN BEAUTY

FINANCIAL PLAN

CONCLUSION

A STRATEGIC INITIATIVE

APPENDIX

EXECUTIVE

SUMMARY

WHAT WE BELIEVE AT LUSH The LUSH company belief and motto is “happy people making happy products.”

The LUSH Cosmetics creators have been working together to create completely handmade products since the 1970’s. Originally, it was not under the name LUSH, but they recreated the company in 1994 and reopened their doors as ‘LUSH Cosmetics.’ The company was an instant success in England, and today we have over 600 stores in 43 different countries. The LUSH company belief and motto is “happy people making happy soap.” Our privately held company, based in

England, manufactures and has a market of personal healthcare products and gifts. Priding ourselves in the use of completely organic ingredients to make up our product lines, we strive to ensure our products are always fresh and always satisfy the customer’s needs. Our entire company is “green,” from our stores, to our offices and factories, to our ingredients and our packaging, and we strive to create a personal

LUSH COSMETICS

experience with our customers, even having our employees trained to personally handmake our products. With all of this, LUSH has decided to implement a new strategic initiative for our company, but more importantly, for our customers. We have created a digital app that can be utilized through the customers phone or tablet, and also in-store through a beauty bar we will be implementing

soon. Through the app, customers will be able to fully customize their products and what goes into them, based on their personal skincare needs. We feel that this will be a wonderful addition to our company and that it will reinforce our dedication to providing our customers with that personal experience.

A STRATEGIC INITIATIVE

“Priding ourselves in the use of completely organic ingredients to make up our product lines, we strive to ensure our products are always fresh and always satisfy the customer’s needs.”

COMPANY OVERVIEW

LUSH has become the leading example in natural products and has taken a new fresh take in beauty. However, it’s been a long road to get to where they are today.

“Social responsibility is continuing to grow as a movement; this growth is pushing beauty and personal care consumers to think more critically about how their beauty and personal care products are made and whether they ingredients are good for them and the environment”

1977: Liz Weir and Mark Constantine meet while working at the same salon. A few years later, they decided to branch out and start their own business selling natural hair and beauty products. They set to work in their homes creating products with fresh, natural ingredients for the hair and skin. Early 80’s: Together they created ‘Herbal Hair and Beauty Clinic’ which sold their products to The Body Shop. Eventually The Body Shop no longer wanted to license their products which left them empty handed. 1987-1994: Cosmetics To Go changed the way the two looked at business. They lavished all their money and attention on their latest business, and it was a very

One of LUSH’s promises is to say NO to animal testing.

LUSH COSMETICS

The typical consumer remains primarily feminine and continues to worry about aging, dry skin and damaged hair.

successful although complicated venture that ended up burning out. The company went into administration and sold to someone from Poole, who took the product formulas and the Cosmetics-To-Go name. 1995: LUSH waas founded and opened its first store in Poole. 2007: LUSH’s Charity Pot product was launched, a hand and body lotion that softens skin and warms hearts. 100% of the purchase price (every single penny minus taxes) goes into our Charity Pot fund, which is donated to environmental, humanitarian and animal rights charities. In the first five years, LUSH donated two million dollars to charities through the Charity Pot program. LUSH’s Promise • Say no to animals • Freshest cosmetics • Naked packaging • Ethical buying • Handmade • Vegetarian Revenue • 2014- $720 million in sales • 2015- $870 million in global brand sales • 2016- estimated to reach 1 billion • E-commerce- $80 million in 2015 A STRATEGIC INITIATIVE

TARGET CONSUMERS The typical consumer remains primarily feminine and continues to worry about aging, dry skin and damaged hair. The market demographic appears to be shifting though, and new groups are looking for new products. Now women as young as 25 are beginning to show concern for aging and are looking for products to prevent wrinkles. Men are continuing to become more interested and involved in the market. Social responsibility is continuing to grow as a movement; this growth is pushing beauty and personal care consumers to think more critically about how their beauty and personal care products are made and whether they ingredients are good for them and good for the environment. LUSH has positioned its retail locations in

markets

where

consumers

are

spending considerably on personal care and beauty products â&#x20AC;&#x201C; in high traffic shopping areas as well. With the products LUSH offers, the location of its storefronts and the style of its shops, LUSH has a specific consumer in mind. LUSH is targeting primarily women 18-45. While LUSH does have products for men and children, the majority of its line is directed towards women of this age group. With their locations, LUSH is targeting women of a higher socioeconomic

class,

specifically,

middle to upper class. Women who are beginning to or have already established themselves professionally.

LUSH COSMETICS

LUSH is targeting women of a higher socioeconomic class, specially, middle to upper class. Demographics • Gender – Female / Some male • Primarily women age 20-25 • Age - 18-45 • Income – Mid to High / spending between $15,000-100,000 on beauty care products • Education – College Degree • Location - City & suburban assessments/ living • Household size – 4-6 Psychographics • Lifestyle: • Middle to upper class • Live an organic, healthy and eco-friendly lifestyle, care about the environment • Both laid back & on-the-go lifestyles • Desire fresh organic beauty • Women who are beginning to or have already established themselves professionally Attitudes • Motivated by self-expression • Seek variety and excitement • Environmentally conscious

Now women as young as 25 are beginning to show concern for aging and are looking for products to prevent wrinkles.

Buying Behavior: Have heightened levels of agreement with most attitude statements. Including the likelihood of splurging on themselves when it comes to beauty and personal care products (72%), the desire to try new brands of beauty and personal care products (70%), and the willingness to pay extra for better quality beauty and personal care products (84%) --Avid & impulsive consumer

A STRATEGIC INITIATIVE

Accessibility

Price

LUSH COSMETICS

SWOT ANALYSIS STRENGTHS

WEAKNESS

OPPORTUNITIES

THREATS

-Developed a highly distinctive retail format that was highly inspired by groceries. -Gives back to the society with strong CSR campaigns. -The packaging expenses are kept at a minimum.

-Advertising is not very attractive and efficient compared to the global players. -High prices of the products makes them not affordable to the lower class. -Pure products always have the issue of keeping them in the fridge.

-Stronger and more cohesive social media and omnichannel presence. -Customization! -Implementing more technology throughout the business.

-More brands emerging into the sustainable cosmetics industry. -Availability of cheaper products.

PERCEPTUAL MAP & COMPETITORS LUSH’s two major competitors are The Body Shop and Origins Cosmetics. Additional competitors include Neutrogena, Burt’s Bees, and Aveda. The Body Shop International plc, known as The Body Shop, has 2,400 stores in 61 countries. The company, which has its headquarters in Little Hampton, West Sussex, England, was founded in 1976 by Anita Roddick and is now part of the L’Oréal corporate group. The Body Shop carries a wide range of products, like LUSH, for the body, face, hair and home. The Body Shop claims its products are “inspired by nature” and they feature ingredients such as marula oil and sesame seed oil and also like LUSH are sourced through the Community Fair Trade program. In March

A STRATEGIC INITIATIVE

2006, unlike LUSH, The Body Shop agreed to a £652.3 million takeover by L’Oréal. Origins was created in 1990 as a scientifically proven but natural skin care. Origins is one of the original brands of the Estee Lauder Companies and was established by Leonard Lauder, the son of the famous lady. Origins has tried to distance its ties to Estee Lauder but still remains under the same company umbrella.

“The global organic personal care products market witnessed steady growth in recent years due to increasing consumer concerns regarding personal health and hygiene.”

Ever since Origins launched its products it has kept its mission to stay committed to nature by using only organic ingredients, potent plants, and 100% natural oils. These products are also manufactured free of parabens, phthalates, mineral oil, petrolatum, DEA, PABA, propylene glycol, paraffin and animal ingredients. The company also places some emphasis on remaining green by its utilization of earth and animal friendly approaches to manufacturing, testing and packaging.

MARKET POSITION The global organic personal care products market witnessed steady growth in recent years due to increasing consumer concerns regarding personal health and hygiene. In addition, widening distribution channels and new product development are the other factors that contribute to the market growth. Skin care products dominated the demand in the global organic personal care products market in 2011, with a 32.1% share, followed by hair care and cosmetics segments. In terms of revenue, the market for organic skin care products is expected to grow at a rate of 9.9% from 2012 to 2018. LUSH has transformed itself from a single shop company in 1995 to a multi-million dollar company with 850 shops in 51 countries in a little over 17 years. LUSH has had so much success because of its practices that set it apart from competitors like The Body Shop and Origins. LUSH’s competitive advantage stems from its fierce commitment to remain independent, its environmentally conscious attitude, its unique production of fresh handmade products and limited but creative use of its marketing budget.

DISTRIBUTION CHANNELS Lush Cosmetics is sold exclusively in Lush stores around the world. Today, the company has over 820 shops in 50 countries across the globe. In addition, sales channels include both e-commerce and m-commerce through the Lush Cosmetics website and mobile app. Today, about $90 million of the company’s global annual sales of $1 billion come from North America, which includes manufacturing facilities along with the distribution of storefronts, malls, airports, and their 300 to 500 square-foot stores in the cosmetic departments of thirty-eight Macy stores.

LUSH COSMETICS

A STRATEGIC INITIATIVE

LUSH COSMETICS

CURRENT COMMUNICATION

& PROMOTION

LUSH creates aesthetically pleasing content that engages their customer and creates brand awareness through their promotional activities. LUSH’s catalog is a major promotional opportunity for the company. It is published two to three times a year and showcases specific products in the store in addition to gift guides for Christmas and other holidays. The e-newsletter is sent in order to educate customers on environmental issues and inform about exclusive offers on products. Furthermore, LUSH’s social media is a huge factor in promotion and communication to the customer. Social media outlets include facebook, twitter, youtube, instagram, pinterest, tumblr, and google plus. They do not purchase traditionally promotional activities, including advertisements and commercials, and as a result, they rely heavily on word of mouth and educated, quality employees in addition to sustainable campaigns and a highly informative website. CRM LUSH provides customer service through a consultant-based approach. Their sales associates are expected to teach each customer at least five product demonstrations per visit. The company values the education of their sales associates in order to provide an educational approach to their retail environment. The customer relationship exemplifies a hands on experience. Lush not only provides their customers with education on products and ingredients but also global environment issues.

SOCIAL MEDIA IS KEY: LUSH’s social media is a huge factor in promotion and communication to the customer.

A STRATEGIC INITIATIVE

THE NEW STRATEGIC

INITIATIVE

LUSH Cosmetics would create customization in their stores by allowing the customer to choose their own ingredients based on recommendations of specific skin types. A customization bar will be located in a few LUSH stores, where iPads will guide the customer in choosing their ingredients and product category. The product will be made in store and taken home with the customer immediately after. Additionally, they will be utilizing the new app launched in early May 2017 to provide the same opportunity for customers at home shopping. These products will be delivered to customers or have the option of pick-up in store.

OPERATIONAL PLAN

LUSH COSMETICS

THE APP

A STRATEGIC INITIATIVE

PROPOSED LOCATIONS LUSH will open one test location in the Westlake Area of Seattle, Washington. After a lot of research and analyzation this area best fits our granola customer. If the trial goes well we will have future locations in the New York City area, LA, Portland, Austin, Chicago, and Charleston.

LUSH COSMETICS

WESTLAKE AREA- SEATTLE, WASHINGTON 28% (majority) of population is 21-34 Young Digerati: • Wealthy younger families • Reliant on technology • Elite, highly educated (graduate+) Bohemian Mix: • Tend to be more eco conscious than the average consumer • Have money to be discernable about their purchases • Loyal to brands and well educated • Reliant on technology

ABOUT THE WESTLAKE AREA Westlake is a very narrow sliver of a neighborhood. Transport to and from downtown is easy, either via bus, car or bicycle. There are still 100 yr homes mixed in with more modern apartments and condos and even some town homes.

kids. But this location is closer to downtown than what you would think of actual Westlake Area.

Pine street leads up to the famous Pike Place Market - where they throw the fish! Despite its small size, Westlake is fairly crowded, with parking sometimes difficult on its crowded, narrow streets. It is also the land of urban condo/ apartment dwellers with very few A STRATEGIC INITIATIVE

SIMILAR INITIATIVE

LUSH COSMETICS

A STRATEGIC INITIATIVE

Beats is a leading audio brand that has introduced an entirely new generation to the possibilities of premium sound entertainment. They have created a music app that is featured on the ‘Made by Apple’ app store page. This subscription-based streaming app inquires what music the customer likes and doesn’t like, based off of genres and artists they have listened to, etc. The app also features a “Just for You” page where different music options have been curated based upon what the customer has previously chosen to listen to. Delectable Wines created the “Essential Wine App” which has many different features. By taking a photo of any wine label, the customer is able to instantly get access to ratings and descriptions with Delectable’s critically-acclaimed, free app. You can also keep track of your favorite wines with the ‘Wine Journal,’ have suggestions provided through this feature as well, read wine reviews, buy wine directly from your phone, and this all works for beer and spirits as well. ShopWell is a personal nutritionist in your pocket! This is a free app that helps over two million families shop smarter at the grocery store. ShopWell helps customers avoid allergies, manage weight, succeed at health challenges and manage conditions such as diabetes, high blood pressure and gluten intolerance. By downloading the app, customers can enter any food allergies, avoidances and requirements for each family member, and the app will create customized nutrition labels for your dietary needs. You can also connect your Apple Healthkit with ShopWell, and they will make sure we’ve got your personal stats and activity saved and on track.

customers are able to choose by jewelry type, color, gemstone, etc., and completely make their own customized design that they can take home that day, or have shipped to their home.

Kendra Scott is a jewelry brand that has implemented something called the ‘Color Bar’ into their physical boutique stores, as well as on their website. It is a customizable way for the customers to shop. Through the website or the touch screen TV in-store,

LUSH COSMETICS

FUTURE COMPETITORS Through our thorough research, we found that these companies would be the future competition for LUSH. Based on certain features such as being a beauty brand that sources fresh ingredients, using cutting-edge technology, providing personalized experience, and so on, these brands fit into our future competition category because they are similar to our brand and could potentially follow in our footsteps and implement our strategy later down the road. • The Body Shop • Origins • Benefit • Aesop • Fresh • BirchBox • Eco Materials

“...being a beauty brand that sources fresh ingredients, using cutting-edge technology, and providing a personalized experience...”

A STRATEGIC INITIATIVE

CURRENT INITIATIVES IN BEAUTY Sephora has an in-store app where customers can find exactly what type of product they are looking for. Through the screen, customers can search fragrances, for example, based on the scents and notes they prefer. L’oreal has an augmented reality app that converts your phone’s camera into a mirror. Through this feature, customers are able to virtually try out different L’Oreal products. Benefit has the brow genie where customers are able to upload a picture of their face, and through a 3-step custom brow mapping technique, it shows the customer their key facial features to determine exactly where your ideal brow should start, arch and end. Shelf Cosmetics has created a mobile app that is designed to make the process of selecting and purchasing nail polish and cosmetics more simple and convenient for women. Through the app, you can browse by color, brands and a feed, as well as create a personal profile, follow others and converse/read reviews to find the best fit. Eco Minerals has an app customers can use to choose their mineral foundation, blush, bronzer and illuminate. You are asked questions about your skin type and color, and the best ECO minerals products are chosen for you and saved as a shopping list on your iPhone or iPad.

LUSH COSMETICS

FUTURE IDEAS Customers want to be able to see what the products will look like on them before buying.

A STRATEGIC INITIATIVE

In the future, LUSH may want to incorporate virtual reality in the future for their makeup products to keep up with its competition that is implementing this strategy. Customers want to be able to see what the products will look like on them before buying. This way they can do that without having to even enter a store. Blush,however, can benefit greatly from the customization strategy. Many cosmetic brands are finding this beneficial, with there being so many different skin types out there.

COMMUNICATION

&PROMOTIONAL PLAN

PROMOTIONAL STRATEGIES Promotion of the strategic initiative will be focused around social media channels, as Lush Cosmetics has a strict protocol to traditional advertisements. The e-newsletter of the month will inform customers of the launch date and how the system works. Additionally, there will be an exclusive discount code in all email newsletters to give exclusivity to customers on the email list. Furthermore, the catalogs during prelaunch, launch, and post launch will incorporate the customization bar by informing the customers about ingredients they should choose for their skin type through compelling imagery and

content. During the launch, Lush Cosmetics will have a launch party in NYC. Sweepstakes and contest will allow customer participating in the new customization bar and bring winning customers back to redeem their prices. Post launch will include encouragement of Black Friday sales and holiday gifts by using the customization bar as well.

LUSH COSMETICS

SOCIAL MEDIA

DIRECT

Social media will be implemented as a promotional strategy to engage and inform customers on the launch of the customization bar. Content will include information regarding specific ingredients for certain skin types and reasons to use the bar. Additionally, the launch party will be advertised, and hype regarding sweepstakes and content will be shown. Content will be delivered in a timely manner in order to reach a wide range of customers.

Email marketing will be utilized to strategically send out to customers in order to inform subscribers of the launch and specific sweepstakes and contests. Pre-launch will announce information regarding the launch promotion. Launch e-newsletters will announce dates and contests to persuade customers to visit the store in order to experience the customization bar. Post-launch will announce promotions for Black Friday and Winter Holidays through the bar.

A STRATEGIC INITIATIVE

LUSH CATALOG

The lush catalog will feature the customization bar by informing the reader about the process, and which ingredients should be combined in order to create skincare results. The catalog, featured in April and August, will have an extensive section designated to the customization portion of the company.

LAUNCH PARTY

The launch will be located at the Lush store in the West Lake area of Seattle, Washington. During the launch, Lush will incorporate signage and balloons outside of store to grab the attention of people walking by. Inside of the store, employees would greet each person with a special sweepstakes card and center a conversation around the newly developed innovation of customization.

SWEEPSTAKES

The sweepstakes and contests incorporated in the launch will include free samples and a chance to win a free customization product. Each customer will be given the opportunity to enter their name into the sweepstakes. Another contest will include a scratch off that will allow the customer to come back during the post-launch and receive a discount on a product.

LUSH COSMETICS

â&#x20AC;&#x153;Instead of focusing on traditional advertising, the launch of the Beauty Bar for LUSH will focus on social media, the catalog, and a launch party.â&#x20AC;?

introducing

lush beauty bar Please join us for the launch event

Where: Westlake Center store, 400 Pine St, Seattle WA 98101 When: October 15th, 2016 at 5:00 PM *Special sweepstakes and giveaways TBA* Kindly RSVP to beautybarlaunch@lush.com

See you there!

A STRATEGIC INITIATIVE

FINANCIAL PLAN BUDGET

THE APP

HUMAN RESOURCES

We estimated that the app research and development would take approximately 3 months with a team of three people and take about $48,000. For tech sourcing, since they have all of the functions on the app it will be $22,000 to add to this initiative. Installation for this app should be approximately $15,000 as well as product testing will be $15,000. Since this app is big platform for Lush, maintenance will be approximately $200,000. The total for the app development is 300,000.

We estimated that that it would take approximately 8 hours of training for 10 sales people ($10/hour) and 4 managers ($20/hour) to give them the proper training to implement the customization initiative. We would also need 2 carpenters also taking 8 hours ($30/hour) to install the wall.

MARKETING We are having a launch party that we estimate to be $10,000. As well as $2,000 in prizes for 4 winners that each get $500 worth of product prizes. Social media will be $10,000.

LUSH COSMETICS

October

November

December

January

February

12%

14%

10%

$12,420,000

$14,490,000

$10,350,000

$8,280,000

$496,800

$724,500

$310,500

$248,400

$12,916,800

$15,214,500

$10,660,500

$8,528,400

March

April

May

June

July

$6,210,000

$5,175,000

$7,245,000

$4,140,000

$124,200

$103,500

$144,900

$82,800

$6,334,200

$5,278,500

$7,389,900

$4,222,800

August

September

TOTAL

10%

100%

% Sales 11% Forecast Company $11,385,000 Sales Forecast % Sales 3% Increase $341,550 Monthly Revenue Forecast Total Revenue $11,726,550

% Sales Forecast Company Sales Forecast % Sales Increase Monthly Revenue Forecast Total Revenue

$8,280,000

$10,350,000 $103,500,000

30%

$82,800

$103,500

$31,050

$8,362,800

$10,453,500 $134,550,000

A STRATEGIC INITIATIVE

CONCLUSION In conclusion, we feel that this new strategic initiative will be a great addition to our company and bring in more sales from the market as a whole. The app will interest our customers even more, giving them the opportunity to customize their skincare right down to the select ingredients that go into the product. The current estimated income for the store is around $1,046,000 annually, and the estimated m-commerce app annual income for the past year is $8,000,000, as that is 10% of the current e-commerce. Therefore, the combined annual income estimated at about $9,046,000. Currently, the annual income for Lush stores in North America is $90 million for the year of 2015. Within a year of introducing the Lush app, we expect to have a 30% increase in overall sales. Because we are launching in October, the percent increase in sales through the Holiday months will be the highest. After December, the increase in sales will be lower, eventually plateauing in the Spring and Summer months. Normally, Lush sees a 15% increase each year in sales, which projects that annual sales for the year 2017 will be $103,500,000.With the 30% increase in sales over a year, we project the total revenue for the year to be $134,550,000.

We feel that this will reinforce our personal experience with our customers and provide them with an even better cosmetic and skincare experience. Having the app on your phone, or coming into the store to utilize it at the beauty bar will provide customers with a new, exciting and different way to shop, and in turn, we believe this will ultimately benefit our sales and our company as a whole.

LUSH COSMETICS

A STRATEGIC INITIATIVE

APPENDIX

LUSH COSMETICS

OMNI CHANNEL AUDIT The Website

Overall, Lush’s website is easily accessible and easy to navigate. It utilizes a great use of media and imagery. It includes product reviews, videos, tutorials on how to use products, as well as a “Lushopedia” of ingredients. They are sure to have great customer care, including a reFresh program, ask us button, as well as making instore appointments.

linked to other pages and are high with customer engagement. Instagram shows off their products in an artistic way. Links directly to a “Social Shop” page on their site. Youtube offers different categories of videos so you can decide what you want to watch (how its made, charity work, get to know us, etc). Google + and Tumblr are actually updated regularly, uses GIFs and lots of interactive content to engage the reader.

Lush Catalog

Improvement Suggestions

Great option because their customers are obviously ecoconscious and this lessens their environmental impact by having a digital magazine/catalogue. This publication gives stories, product history, as well as what’s coming for the future of LUSH (product innovations.) It is easy to subscribe to and intriguing.

After lots of analyzation, we’ve concluded a few improvements that could be made to create a more omnichannel experience. The Lush blog is rarely ever updated and needs more engaging content. For such a visually pleasing company, LUSH needs to focus more of their efforts on Pinterest, it is very neglected compared to other platforms.

Social Media

Lush is present on Facebook, Twitter, Instagram, Youtube, Google+ and Tumblr. Lush’s Facebook and Twitter have a similar feel but still tailor to each platform. Both are

A STRATEGIC INITIATIVE

CUSTOMER PROFILES

KENDALL HARPER • • • • • • •

Age: 20 Gender: Female Occupation: Student / Sales Associate at a local boutique Income: $8/hour (not including her parents financial supply) Education: High-school graduate / currently in college Interests: Concerts/Music, Painting and Yoga Likely to buy: LUSH Scent; LUSH Bath Bombs

SERENA SMITH • • • • • • •

Age: 35 Gender: Female Occupation: Mother / Part-time Yoga instructor Income: Joint income with husband – $200,000 Education: Bachelor’s Degree Interests: Cooking healthy meals, attending cycling and Pilate’s classes and hosting dinner parties Likely to buy: LUSH Masks; ‘The Sacred Truth’ Mask

ANDY WALKER • • • • • • •

Age: 27 Gender: Male Occupation: Web Designer Income: $90,000 Education: Master’s Degree Interests: Music, hiking and camping trips and pottery Likely to buy: LUSH ‘Dirty’ Shaving Cream

STORMI ANDERSON (GRANOLA) • • • • • •

Age: 25 Occupation: Grad School Income: (Supplemented by parents) Education: Master’s - Dietitian Interests: Raw foods, Yoga, Hiking, Painting, Astrology Likely to buy: Customized Lush Products

LUSH COSMETICS

COSTING BREAKDOWN FIXTURES E15 table:$4,000 Floor shelving:$600 Floating shelves: $100 Screen(48â&#x20AC;? touch): $975 Basket displays:$300 Lighting:$1200 Table $700 I-pads:$1500 Ipad stands: $150 Total:$8,895+ LOGISTICS 2 carpenters- $480 (8 hours, $30/hr) Training: 8 hours 10 sales people at $10/hr= $800 4 managers at $20/hr=$800 TOTAL: $1,600

A STRATEGIC INITIATIVE

SOCIAL MEDIA & TECHNOLOGY “In one single day, millenials touch their phones an average of 45 times per day. Furthermore, 87% use two to three technology devices per day.”

After thorough research, we can confindently say that millenials connect better with people rather than logos. They are extremely brand loyal. In fact, 60% are often brand loyal to products that they have already purchased. Also, 62% say they are more likely to be loyal to a brand if they connect with them on social media. Throughout one single day, millenials touch their phones an average of 45 times per day. Furthermore, 87% use two to three technology devices at least once daily. 77% use laptops, 67% own game platforms, 72% use MP3 devices, 15% use tablets or computers, and 85% use smartphones.

Images taken from LUSH’s Instagram. 38

LUSH COSMETICS

Our customer is extremely informed with social media and technology and has been missing this experience when shopping for beauty products.

• •

1% say they trust brand advertisements 33% rely on blogs before they make a purchase

Five out of six millenials connect with companies on social media. • 87% use Facebook • 37% use Twitter • 53% use Instagram • 34% use Pinterest

A STRATEGIC INITIATIVE

KEY TRENDS •

•

The beauty industry is becoming more reliant on the augmented human. The line bewteen human and technological device is blurring as smart technology puts people in greater control of their individual health and beauty needs. Lots of beauty brands have collaborated with fashion houses to make their products more innovative and available to more customers. Beauty product prices are being driven down and down as more “affordable” product lines are released.

LUSH COSMETICS

THE BEAUTY INDUSTRY OVERVIEW The beauty industry saw tremendous growth in the past two years due to a productive stock market and increasing employment rates. Large, multinational companies continue to dominate the market. Small specialty brands have steadily increased, as well as natural beauty companies. Consumers are beginning to become more interested in the “natural look,” opting for more neutral palettes in makeup that can be worn year-round. With this, skin problems have always been a concern. As of now there is not one brand that allows the consumer to specialize their products on hand. Also, consumers are also more highly interested in multi-purpose products that feature various benefits while also reducing the need to buy several items, resulting in both saved time and money.

Sales Distribution • • •

Non-Retailing Channels 29% Non-Store Retailing 16.5% Store Based Retailing 80.6%

“The line between human and technological device is blurring as smart technology puts people in greater control of their individual health and beauty needs.” A STRATEGIC INITIATIVE

BIBLIOGRAPHY http://www.lushusa.com/ https://www.facebook.com/lushcosmetics https://twitter.com/lushcosmetics https://www.youtube.com/user/lushvideos https://www.instagram.com/lushcosmetics/ https://www.pinterest.com/lushcosmetics/ http://lushcosmetics.tumblr.com/ https://plus.google.com/103856845207610420702/posts?hl=en http://forum.lush.com/forum/ https://storify.com/kwilkison/lush-competitive-advantage https://storify.com/kwilkison/lush-target-market https://www.ukessays.com/essays/marketing/global-marketing- lush-ltdmarketing-essay.php http://www.cosmeticsandtoiletries.com/formulating/category/natural/Demandfor-Organic- Beauty-to- Grow-to- Over-13- Billion-by- 2018-Report- Says213160491.html http://www.retail-merchandiser.com/index.php/reports/retail-reports/94-lush-2 http://method.com/work/lush http://smbp.uwaterloo.ca/2012/02/lush-cosmetics-gets-the-word-out-using-social-media/ https://www.bluelabellabs.com/ideatoappster/how-much-does-it-cost-to-make-an-app-an-infographic/ http://savvyapps.com/blog/how-much-does-app-cost-massive-review-pricing-budget-considerations http://niackery.com/greenniackery/personal-care/lush-demystified/ https://www.bluelabellabs.com/ideatoappster/how-much-does-it-cost-to-make-an-app-an-infographic/ http://savvyapps.com/blog/how-much-does-app-cost-massive-review-pricing-budget-considerations http://seattle.findwell.com/seattle-neighborhoods/westlake/

LUSH COSMETICS

https://www.franchisehelp.com/industry-reports/beauty-industry-report/ http://www.mintel.com/beauty-and-personal-care-trends/ https://www.lushusa.com/Our-History/about-history,en_US,pg.html https://storify.com/kwilkison/lush-competitive-advantage http://www.bmmagazine.co.uk/entrepreneur-interviews/profile-mark-mo-constantine-co-founders-lush/ http://www.retailtouchpoints.com/features/retail-success-stories/lush-merely-scratching-the-surface-of-multi-bi llion-dollar-cosmetics-market http://beautybanter.com/best-natural-ingredients-for-every-skin-type http://www.lalineusa.com/blog/skincare-products-ingredients-to-look-for-by-skin-type/ http://www.thefitindian.com/homemade-natural-products-for-all-skin-types/ http://draxe.com/natural-skin-care/

A STRATEGIC INITIATIVE

LUSH COSMETICS