1. Introduction

1.1 Cosmetic Industry Review

The cosmetic industry has developed rather rapidly since these early days of limited products as the quest for beauty has become ever more important. In 2000 the cosmetic industry represented a $166.2 billion market worldwide. Between 1994 and 2000, the global cosmetics industry grew at a rate of 11.5 per cent (Euromonitor, 2001). In 2001, Cosmetic products constituted roughly 18% of total global market for Cosmetics and Toiletries where makeup solely contributed $22.5 billion (ScienceDirect, 2005). The cosmetic industry is very competitive with the presence of those largest global players. They are L’Oreal, Unilever, Procter & Gamble, Johnson & Johnson, Avon, Shiseido, Estee Lauder, Revlon, Mary Kay and Max Factor. (Drug & Cosmetic Industry, 2000).

2.0 Behaviour analysis

2.1 Internal

Consumers may choose products that can be used to express consumer personality, social status or to fulfil their internal psychological needs. Everybody is motivated by needs and wants to attain their desired goals. (Schiffman, Bednall, O’Cass, Paladino & Kanuk, 2005). Needs are defined as the basic forces that motivate a person to do something and wants are the needs that are learned during a person’s life (Weber & de Villebonne, 2002).

Meeting consumer needs is the fundamental goal of a marketer. Cosmetic products are generally marketed to appeal to three basic types of consumer needs; functional, social and experiental needs (Kim, Forsythe, Gu & Moon, 2002). A product’s functional attributes satisfy the consumer’s need to prevent or solve problems. For example, Amway strongly emphasises the functionality of their products where they clearly target consumers who are seeking the need to merely fulfil their functional need (Euromonitor, 2009). Next, social images satisfy social needs such as social approval, affiliation or personal expression and outward directed self-esteem. Consumers higher in social needs may value a socially visible product that provides prestige and exclusivity (Kim et al., 2002). Social status can be measured from a person’s occupation, income and education. For example, the price of different cosmetics may convey a different social status. In instance, people may perceive a person who buys a M.A.C comestic (a high end product) to have higher income than those who buys a lower end product such as AVON. Lastly, experential needs reflects consumers’ needs for novelty, variety, and sensory gratification (Kim et al., 2002). For example, many cosmetic companies such as Bobbie Brown offer different ranges of colours and flavours for their lipsticks and also different colours for eyeliners. These consumers may be those whose level of consumer dogmatism is low in which will be further discussed below.

Another important factor that would influence the formation of a marketing strategy would be the personality of consumers. The personality of consumers is defined as a unique, dynamic organisation of characteristics of a particular person, physical and psychological, which influence behaviour and responses to the social and physical environment. Two important specific personality traits that influence behaviours are consumer innovativeness and consumer dogmatism. High consumer innovativeness exists where consumers have the urge to try out new products. High consumer dogmatism on the other hand happens when consumers only have a small desire to try out new products (Schiffman et al., 2005).

In the cosmetic industry, this is evident where young consumers have high consumer innovativeness and low dogmatism as they would always try out new and more futuristic products such as more vibrant colours to give a different look to them as they are fashion conscious group(Bakewell & Mitchell, 2003). Besides, young consumers are also more easily adaptable to the changing business environment where they have accepted and practised e-commerce as a very reliable method of purchasing products (Bakewell et al., 2003). In contrary, older consumers tend to practise the trait of high level of consumer dogmatism and low consumer innovativeness. This is where they tend to purchase the same products (Schiffman et al., 2005) and they would also prefer the conventional way of purchasing product (Bakewell and Mitchell, 2003). This is evident on research, where older consumers tend to be correlated with a lower amount of online purchases (Black, 2005). Therefore, many cosmetic companies segment their market based on age where new different products are used when targeting younger consumers and similar products are used when targeting older consumers.

2.2 External

Subculture also plays an important role in affecting consumer buying behaviour. Consumers’ lifestyles are affected by group memberships within the society-at-large. These groups are known as subcultures, whose members share beliefs and common experiences that separate them from others. A consumer can be categorized under many subcultures such as age, race or ethnic background, place of residence, or even a strong identification with an activity or an art form (Burgh-Woodman & Brace- Govan., 2007).

An increasingly important consumer group are women of different races such as Black, Hispanic and Asian (Anonymous, 2004). Hence, an effective marketing strategy would be needed to reach different ethnic background mostly due to their differences in language used. For instance, Spanish, English and bilingual mix are programs for the Hispanic. Each of these reaches a potentially different sub segment of women, in terms of acculturation level. Asians on the other hand, are best reached using in-language media. It is important that targeted consumers understand the details of the products. Hence, it is crucial to have different language printed on the packaging so that details of products can be understood by many consumers from different ethnic backgrounds (Anonymous, 2004). This is shown in real cosmetic companies. For example, Estee Lauder in Malaysia has languages such as Chinese, English, Bahasa Malaysia printed on their packaging. These are the few common languages Malaysian understands.

Next, would be the traits of having consumers from different age groups as they differ in preferences. Generation X includes individuals born between years 1962 and 1980. Generation Y includes those born between the years of 1981 and 2002. It has been found that each of these generations have very different motivations for buying consumers goods. Generation X’s motivation in purchasing is functionality. Furthermore, need for comfort and fit is their main purpose of purchasing. Whereas, the generation Y’s motivation is to fit in the norm and to have and identity (Dias, 2003). For example, it is shown that many anti-aging product targeted on the consumer born between 1962 and 1980 normally emphasized on their functionality and not just mere cosmetics product that can enhance features. In instance, Procter and Gamble emphasize on functionality during their advertisement on their anti-aging product, Olay Total Effect where they introduce new functions and focus on results. Generation Y on the other hand, may buy cosmetics just because it fits into the norm. Hence, certain cosmetic companies produce cosmetics based on how a basic cosmetic would work. For example, Silkygirl’s main target is on teenagers, selling foundation that function as how a basic concealer would work, without any enhanced features for aging. This is evident from its advertisements which would only portray a good looking model without focusing on drastic before and after differences.

Next, would be the trait of social class. Social classes exist where members from a society are divided into a hierarchy of distinct classes, so that member of each class have relatively the same status and members of all other classes have either more or less status. One of the measures for social class is level of income, the higher the income the higher the social class (Schiffman et al., 2005). Besides basic needs, higher social class consumers purchase cosmetic goods to also satisfy social needs such as prestige and uniqueness. While the lower social class group would buy cosmetics just to satisfy basic need such as hygiene. It is believed that consumers might find the product is for lower social class group if the product becomes widely available and cheap. This is because, widely available and cheaper product does not reveal them as high income earners. Therefore, marketers targeting on higher social class consumer are advised to sell products exclusively with high prices (Amaldoss & Jain, 2005). For example, Estee Lauder and Christine Dior which are both high end cosmetic available over the counter at most of the departmental store in Malaysia (Asia- Pacific Cosmetics and Toiletries, 2006). This trait is also evident in real life situations where Christian Dior sued supermarkets for carrying its products because wide availability could hurt the firm’s strategy of targeting higher social class consumers (Amaldoss and Jain, 2005).From this explanation, it would be similarly applicable for consumers of a lower social class. They would only need to satisfy their basic needs such as hygiene. They desire for products that are widely available as these products would be perceived to be cheap.

Furthermore, reference group is another major factor of buyer behaviour. Reference group is defined as the importance of social group to consumer in which he or she compares himself or herself (Schiffman et al., 2005). Reference groups are found to be a source of brand associations, which can be linked to one’s mental representation of self to meet self-verification or self-enhancement goals. Self verification is someone who has the needs for self-knowledge. These people seek out and interpret situations and adopt behaviours that are consistent with their existing self-conceptions (Escalas & Bettman, 2003). For example, people who perceive themselves as an environmentalist purchases the types of cosmetics that they think is environmental friendly. Companies can position themselves as environmental friendly as shown by The Body Shop where the company is against animal testing and encourage the use of paper bags. These people can be greatly influenced by member groups. For example, Estee Lauder Group as company that concern about the environment used someone who is in the group of environmental friendly people such as Gwyneth Paltrow to advertise their products (Wright,2009).

Self-enhancement on the other hand includes those who are heavily influenced by the need to maintain and enhance self esteem. Cosmetic usage increases facial image (Cash and Cash, 1982, as cited in Guthrie, Kim, & Jung, 2008). These people can be greatly influence by aspiration groups and are more likely to attribute positive outcomes to aspects of self and negative outcomes to circumstances unrelated to self. (Escalas et al., 2003).One of the aspiration groups are celebrities. Normally, cosmetic companies may use celebrity endorsers whose present and idealisation of life instigates most people to imagine that they would love to live (Schiffman et al,. 2005). Celebrities give a perception to people that they beautiful, rich and famous. Thus, many cosmetic companies undertake what Maybelline did where they enlisted a Malaysian actress, Liyana Jasmay a beautiful and young lady as spokeswomen. Hence, this may depict that people who uses Maybelline product may perceive that after using a Maybelline product, they can be someone like Liyana Jasmay.