Natural Way Products' market expansion and brand repositioning strategy

Marketing Management

With the increase in awareness about health issues, many people are switching over to use of natural products from ordinary ones that use artificial methods of production. The same trend is rapidly increasing in the beauty industry. Natural Way Products is a beauty company that specializes in selling purely natural, herbal and organic beauty products. Currently the company is only targeting the female market segment, however it also plans to launch a men's line of product.

As pointed out by the firm's marketing research department, this report suggests that the company must switch its brand name from Zaras and must choose a name that helps in an overall brand image building for the product. The report also suggests that the company must launch its men's line using the same marketing strategy and brand name as for the women's line as this will save on marketing costs and will make it easier to attract customers.

Introduction

In the present post modern era, most businesses are adopting standardized mass production practices so that they can achieve economies of scale. This enables businesses to minimize their average costs and thus increases their profit margins. In order to achieve maximum returns to scale businesses are opting to move towards a flow production method using a heavily mechanized production process. These methods of production increase the firm's output by a significant amount. Unfortunately, like any other business in the corporate world, businesses dealing with beauty products are also adopting the same mass production practices in order to maximize their profits. This means that they want to have a maximum output within a minimum input.

Medical experts commonly associate various skin diseases, infections and allergies with the use of beauty products that are produced using artificial chemicals. The rapid rate of increase in consumer protection groups, awareness programs on electronic media and researches pertaining to beauty product production practices has forced many consumers to make careful choices when buying beauty products items. As a result many consumers have begun to prefer organic beauty products items over beauty products that are produced using artificial methods of production.

Organic or natural beauty products refer to the beauty products that are produced using natural production methods and are free of all artificial chemicals. The basic idea behind natural beauty products production is to restore the natural nutrients in the final product, encourage recycling of resources and balancing ecosystem. In order to achieve this objective, biological and mechanical processes are amalgamated in such a manner that the natural nutrients of the beauty products could be kept from damaging. This is done according to the standards specified by the government.

The growing concern regarding healthy living practices and health hazards associated with use of non-organic beauty products production have forced many people to reconsider their choice of beauty products items. This has created a new market for organic beauty products industry and businesses that are planning or existing in the beauty products production industry are opting for organic methods of production. Natural Way Products is a business that will be sells all manner organic and natural beauty products which is made purely from natural plant extracts

The Business

Natural Way Products is a company that sells all manner organic beauty products from locally grown produce. Natural Way Products is located in Auckland, New Zealand. All beauty products manufactured by the shop are ensured for their quality, freshness, and nutrition value. This allows the shop to position itself as a purely organic beauty products retailer and help create customer loyalty. Although currently Natural Way Products only one focuses on women related products, in future the company plans to diverse in other dimensions of beauty products as well. Natural Way believes that its business idea is lucrative and has a high success potential. This is because there are not many companies which sell purely organic beauty products. Natural Way itself checks for the quality and health standards of the brands it stocks before purchasing it from the producer and customers will be guaranteed that the product they are purchasing is completely natural and healthy.

Market Objectives

As mentioned earlier, the organic beauty products market has witnessed a significant growth after recent researches that have deemed consumption of ordinary beauty products unfit for human consumption. Natural Way Products plans to pursue an informative marketing strategy through which, the company plans to promote and encourage consumers to switch over to use of organic beauty products. Considering the fact that organic beauty products are pricier as compared to the conventional beauty products, Natural Way Products will promote the notion that it is a better idea to spend a little more in order to save your skin from long-term hazards.

Target Market

Natural Way Products portrays itself as a company that only promotes and sells beauty products that meet maximum health and hygiene standard. The target market for Natural Way Products is the local population of Auckland, primarily females. However, in long-term the business plans to expand into different areas of the New Zealand and therefore the target market will also increase. The company is also planning to diverse in to the male market segment. The major customer base of Natural Way Products consists of health conscious people. The market will be segmented according to geographical location, income groups and age groups. The company may also target dermatologists to recommend Natural Way products to their patients.

Marketing Mix

An effective marketing mix is necessary for the shop in order to inform the potential customers about its existence and what it is offering and to compete with the already established brands (Doyle & Bridgewater, 1998). The marketing mix focuses on positioning. The marketing mix of Natural Way Products is discussed under the following sections.

Product

Currently the company only deals with beauty products related to women under the brand name Zaras. Many shopkeepers feel that the name and the bright packaging don't go with the nature of the product and the targeted market. The major competitors which specialize in natural beauty products market have names that go with their overall concept and add to their brand image such as 'The Body Shop'. Natural Way must also think of a similar name that is in accordance with the overall brand image such as 'Botanicals'(Kotler & Keller, 2008).

It must be noted that since the brand name is the ultimate identification of the product a complete change of brand name might mean a complete re-launch of the product. In order to avoid doing so the company can use the parent company's name to sustain the familiarization and can give the product a name that proves is association with Natural Way such as Natural Way's Botanicals. The packaging must also be changed to elegant shades of greens and blues that indicate freshness and nature.

As far as launching the men's line is concerned, the same brand name as the women's line must be used. This is because since the brand image of the women's line is already established, it would be easier to win the trust of the consumers for trying out the new product. In order to familiarize it as a men's product, the company can add the tag "for men" with the main brand name.

Pricing

In general, organic beauty products are more costly as compared to ordinary beauty products items. This is because the yield of organic produce is much less than beauty products items produced using ordinary methods of production. This is because under non-organic methods, artificial chemicals are used to increase the yield of the produced. As a result, producers of ordinary beauty products items can achieve economies of scale, which helps them increase their profit margins even if they sell their produce at lower prices. However, since beauty products items produced using organic methods of production give their natural yield their output is less and therefore they are slightly more costly then the ordinary beauty products items.

Considering the economic constraints it will be difficult for Natural Way Products to price its products lower than ordinary beauty products items. However, there is one plus point that the company enjoys. All other major brands that deal in herbal beauty products such as the Body Shop are very high priced not only because of being organic but also due to its high brand image (Kapferer, 2008). Natural Way can price its products higher than ordinary beauty products but lower than competitor's price, thus still making a profit. This will attract consumers who do not use herbal products despite of their willingness to do so because of lack of affordability.

Place

Natural Way products must be stocked at all major beauty shops. The product can also be sold at major spas and beauty salons (Kotler, & Keller, 2008). This will be a good idea to increase the sales as one's personal beautician stocking a product might make a customer trust the product.

Promotion

Natural Way Products will be using a combination of promotion strategies including both above the line and below the line methods. Local television channels and newspapers will be used to promote the shop. Direct Mail will also be used.

As the primary marketing objective of Natural Way Products is to promote healthy skin care practices informative promotion strategies will be used to create awareness (Keller, 2003). Public Service Messages will be made part of Natural Way's advertisements that will be aimed to spread the awareness about health hazards of promoting conventional beauty products. This will be done with assistance of local dermatologists and medical experts. This will not only increase the revenues for the shop, but will also position Natural Way Products as a socially responsible entity. The shop's tagline, "Think Organic. Eat Organic" will also promote the idea that it is essential to consume natural beauty products in order to have a healthy lifestyle. Natural Way Products will promote the idea that it is better to spend a bit more amount of money on grocery to buy a healthy lifestyle. If health is compromise in order to save on pockets than one might end up incurring larger expenditures in the form of hospital bills.

Conclusion and Recommendation

Natural way although is dealing in product which has a limited number of competitors, the product however faces tough competition from few a couple of established firms such as the Body Shop. The Body Shop has used its name, packaging and all other promotional strategies that gives the brand a 'natural' image. With a name such as Zaras, Natural Way severely lacks that image and therefore will have to change its brand name. However, in order to save itself from the loss of identity, the new brand name must be associated with the parent brand name Nature Way. The advertisements can be used to suggest that the change in brand name and packaging is because of the product's new and much more improved formula. This will trigger more sales.

The men's line must be launched using the same marketing strategy and brand name as the women's line. This is because a new brand name would mean a complete re-launch of the company thus resulting in extra marketing costs (Toole & Donaldson, 2002). Moreover, using an already established brand name would help to easily convince the customers.