Bobbi Brown's strategy for entering the anti-aging market

Bobbi Brown

Industry Environment

Bobbi Brown is the eponymous cosmetics company of a New Jersey-based make-up artist. The company has existed since 1990, and today is owned by Estee Lauder, and represents around 10% of that company's total revenues (Buck, 2012). Growth in the Bobbi Brown line has come with the launch of branded stores, and a series of brand extensions into fragrances and eyewear. The bread and butter of Bobbi Brown remains the make-up business, however, and that is where the next idea is going to be launched. Bobbi Brown is seeking to capture the anti-aging cream market. This paper will explain the strategy and how it fits within the prevailing industry conditions.

The macro trends in the industry are generally positive. The cosmetics industry worldwide is growing rapidly, at a rate of around 8.5% per year. This growth is fueled by rising per capita incomes, combined with greater access to emerging markets (Sena, 2014). Skin care and lotions are a major growth area for the industry and competition in this market is intense. Another factor in the rapid growth of the industry is the aging baby boomers in many Western markets, including the U.S. And UK. They are driving growth because of their desire to maintain a youthful appearance. This is why anti-aging products offer such strong potential, because of the large demographic that is 50-70 years old right now (Lopaciuk & Loboda, 2013).

There are a few other trends that contribute to the external environment as well. The first is a trend towards luxury products. This is driven by Asia-Pacific markets in particular, as rapidly-rising disposable incomes are creating large new consumer markets in China and the Middle East in particular (EY, 2013). This trend is opening up opportunities for new premium brands to emerge, though it should be noted that the drive for anti-aging products is not as strong in these regions as it is in the West, because the demographics are different.

Target Consumer

The current market for Bobbi Brown is quite broad at the moment, something that has helped to enhance the brand's strong growth and ability to support its own retail outlets (Logarta, 2002). The market for the anti-aging line therefore can appeal to a fairly broad demographic. The strategy that will be utilized will be to include products in the line for both younger women and older. Younger women are also fairly interested in anti-aging products, especially when they see their first signs of aging. By targeting the company's traditional broad range, Bobbi Brown has the opportunity to capture consumers in their 20s and hold them as customers over the long run. Baby boomers tend to maintain their desire to look good, and so there will not be the same negative connotations for wearing the same anti-aging products as one's mother -- the Bobbi Brown image and market is actually inclusive of multiple generations, something that is relatively unique in the cosmetics industry.

The anti-aging products will at first be marketed in the major markets with the most pronounced baby booms -- the U.S., UK, Canada and Australia being the major focal markets, the UK being especially promising. While there is growth in Asia, selling anti-aging products to that audience is not exactly the same as to English-speaking markets so there is a learning curve and the same demographic opportunity does not exist. Furthermore, while male cosmetics is a growing market and anti-aging products are most certainly a bridge into that growth opportunity, it cannot be done within the context of the Bobbi Brown brand or stores, because those are far too closely associated with women. The company can certainly explore that possibility, but will need a new line and distribution strategy in order to sell to the male market.

Ps

The product has been discussed above, noting that there will be a variety of complementary products within the line of anti-aging products Bobbi Brown will be releasing. The line is necessary because it drives more sales, but also because this is what consumers want. They do not want an anti-aging product, they want an anti-aging strategy, something that is comprehensive and compelling. Thus, the line-up will feature anywhere from 3-4 to 9-10 anti-aging products, depending on the creativity of the R&D team. The biggest challenge will be to offer compelling products that steal customers away from other companies' anti-aging lines, rather than simply cannibalizing existing Bobbi Brown business.

The price point for this new line will be at a slight premium to existing Bobbi Brown products. While the existing products command a strong mainstream market, the anti-aging market tends to have more disposable income. Furthermore, 'anti-aging' is considered to be value-added relative to conventional cosmetics. There are higher ingredient costs as well. With these factors combined, higher prices are needed to maintain margins but they also reflect the buying power of the target market and the value-added nature of the product.

The place reflects the distribution. Bobbi Brown has strong distribution. They sell in their own branded stores, and in department stores like Debenhams and other high street regulars, leveraging the distribution capabilities of the Estee Lauder company. The new anti-aging line will piggyback on this, being sold wherever Bobbi Brown products are sold. In addition, channels will be opened for online sales, enabling broader distribution of the products. However, the existing distribution network for Bobbi Brown products will suffice because it is built to attract the same target market as the anti-aging products.

The promotional strategy is going to need to do two things. The first is that it needs to create market awareness of the line. Remember that the market is going to seek out these products at Bobbi Brown stores and department store counters. This means that there needs to be awareness so that consumers who are seeking anti-aging products will think to look at the Bobbi Brown outlet. So the promotional program needs to spend money, taking out ads in magazines, possible on television, and online, aimed at the target market. Online, both Google and especially Facebook are able to reach this market very effectively, but many magazines reach this demo with a high degree of accuracy as well. The comprehensive program is valuable because exposure it key to people trying out the product. Social media other than Facebook is probably not going to be a big part of the promotional policy, since the target market skews older. They might use FB, but otherwise are not big on social media.

The other element of promotion is that the message has to convey that this line is a total anti-aging strategy. The appeal have to be that these products add distinct value, especially over conventional cosmetics and especially when they are combined. The marketing needs to convey that Bobbi Brown is going provide you with all of the tools you need to slow down time, and seek to differentiate even from other anti-aging lines in this regard, trumpeting superior performance and leveraging the reliability and goodwill of the Bobbi Brown name. Ms. Brown herself can be a good spokesmodel, since she fits this demographic and looks younger than she really is -- and who better to endorse the product that the person whose name is on it?