...1 2.1 Shiseido’s International Expansion Strategy 1 2.2 Shiseido’s Global Advancement Capabilities 4 2.3 Contemporary Adequateness of Shiseido’s Strategy 5 2.4 Re-structuring as a Means of International Value Enhancement 8 3 Conclusion 10 Reference List 11 Appendix 12 * List of Abbreviations CSR Corporate Social Responsibility R&D Research and Development U. S. United States * List of Figures Figure 1 - Internationalization Matrix 12 Figure 2 - Demography China 2025 13 Figure 3 - Urbanization in China Today 14 1 Introduction Founded in 1872 by A. Fukuhara, the traditional Japanese company Shiseido began to successfully produce westernized pharmaceuticals and cosmetics for national high-class consumers in 1878. The founders’ son, S. Fukuhara, studied and gained international experience in the U.S. and France, and thus, induced Shiseido to pursue an international strategy as to grow economically and enhance product recipes by embracing technological change. This strategy change was the initial step towards an internationally successful company which today is worth approximately €7.1 billion (Shiseido Company Limited, 2011a). In order to gain this prosperous status, the company pursued a specific international strategy, which will be elaborated in the first chapter and will be compared to prevailing industry conditions in terms of its adequateness in the third chapter. The second chapter conducts a comparison of Shiseido’s contemporary...
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...CASE STUDY REPORT INTERNATIONAL MARKETING SHISEIDO Shiseido is a Japanese cosmetics producer, market leader in its home country and one of the top ten players in the industry worldwide. Founded 1872 by Arinobu Fukuhara, Shiseido is also known for being the oldest cosmetics company in the world. COMPANY FACTS Net sales (consolidated): $ 7,024 billion Number of employees: 28,810 SHISEIDO group: 89 companies 29 domestic 57 overseas STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS Apart from being market leader in Japan, Shiseido is putting a lot of effort into research and development. Other important points are the strong focus on customer relationship management and environmental protection. But even though R&D is a cornerstone of Shiseido’s corporate philosophy, only 5% of the invented products are patented. This makes the company very vulnerable to competition. Another negative point is the limited other number of points of sale, thus making it hard to reach , customers. But there are also opportunities for Shiseido in the future. First of all, introducing the men’s cosmetics line opened the door to a new market with high potential. Second, forming strategic alliances, especially with foreign companies, can also lead the way to new markets (the same happened in the past when Shiseido formed alliances with Johnson & Johnson or Coca Cola Cola). Searching for new market chances is important because of various threats like for example the increasing competition in existing...
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...Shiseido Company, Ltd.: Facing Global Competition • 667 INTRODUCTION Shiseido was founded by Yushin Fukuhara as Japan’s first Western-style pharmacy in 1872, and has shifted its focus back and forth between cosmetics and pharmaceuticals since 1915. Its strength in both areas has enabled it to weather the Great Earthquake of 1923 and World War II. It leads the cosmetic industry technologically, and has offered Japan many “firsts’’ in products. It introduced Japan to its first toothpaste in 1888. In 1902, Shiseido introduced Japan’s first soda fountain/ drugstore. Three years later, it established the chain store system, which became the backbone of the firm and the standard distribution system for the industry. Shiseido began international expansion in 1957 and is currently represented by 17 subsidiaries and more than 8,700 outlets in 69 countries. Offshore production accounts for about 50 percent of its global sales, which amounted to 64.9 billion yen in fiscal 1997. In 1987, Yoshiharu Fukuhara, grandson of the founder, took over as president. The same year, Shiseido announced a 6 percent decrease in sales and a write-off in inventory worth $239 million; net income fell 34 percent to $72 million.The company also abolished separate sales volume budgeting for sales companies and retail outlets, which had been faulted for the tendency of salesmen to push sales to retailers in order to meet in-house quotas. The 1998 product mix consisted of cosmetics (74% of...
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...Shiseido ------------------------------------------------- Corporate Strategy Analysis Group D Shiseido ------------------------------------------------- Corporate Strategy Analysis Group D Contents Executive Summary 2 Company History and Background 3 Company Analysis 5 Primary Activities 8 Secondary Activities: 9 Strategic Problems 9 Expense Management 10 R&D Expenditures 12 Brand Value 14 Appendices 16 Executive Summary Shiseido is a Global Cosmetics Brand based in Japan, participating in the Beauty and Personal Care Market. Shiseido prides itself on the “Premium” status of its brand across the world, as well as a strong focus on both R&D and the superb training of its Beauty Consultants in properly creating a flagship brand that is beloved by customers. Also part of Shiseido is a broad portfolio of Cosmetics brands in various parts of the world – covering both global and niche target markets to round out the firm’s total product offering. It is these aspects that have driven Shiseido to a household name in its home Japanese market – but it is also these factors that have led it down a path of many problems. This study seeks to identify these problems and the strategic underpinnings responsible for them. To this end, the following line of investigation is used. First, a firm analysis identifies what Shiseido itself regards as core to its identity. Second, an industry analysis seeks to understand the environmental factors that...
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...C ASE 5 SHISEIDO COMPANY, LTD.: FACING GLOBAL COMPETITION INTRODUCTION Shiseido was founded by Yushin Fukuhara as Japan’s first Western-style pharmacy in 1872, and has shifted its focus back and forth between cosmetics and pharmaceuticals since 1915. Its strength in both areas has enabled it to weather the Great Earthquake of 1923 and World War II. It leads the cosmetic industry technologically, and has offered Japan many “firsts’’ in products. It introduced Japan to its first toothpaste in 1888. In 1902, Shiseido introduced Japan’s first soda fountain/drugstore. Three years later, it established the chain store system, which became the backbone of the firm and the standard distribution system for the industry. Shiseido began international expansion in 1957 and is currently represented by 17 subsidiaries and more than 8,700 outlets in 69 countries. Offshore production accounts for about 50 percent of its global sales, which amounted to 64.9 billion yen in fiscal 1997. In 1987, Yoshiharu Fukuhara, grandson of the founder, took over as president. The same year, Shiseido announced a 6 percent decrease in sales and a write-off in inventory worth $239 million; net income fell 34 percent to $72 million. The company also abolished separate sales volume budgeting for sales companies and retail outlets, which had been faulted for the tendency of salesmen to push sales to retailers in order to meet in-house quotas. The 1998 product mix consisted of cosmetics (74% of sales), fine toiletries...
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...products, including toiletries, health and beauty foodstuff, pharmaceuticals and fine chemicals. In addition to the flagship Shiseido brand, the company markets products under a number of other brands including Aqua Label, Benefique, d’ici la, Elixir Superieur, Integrate, Maquillage, Tsubaki and Uno. Shiseido has built a network of some 25,000 franchised cosmetics retail outlets in Japan, both stand-alone and within department stores and supermarket; additional retails outlets are located overseas, particularly in China. Going beyond company controlled outlets, Shiseido products are distributed through approximately 83,000 stores in Japan and about 39,000 overseas. The company also runs various salons, upscale boutiques and restaurants. Of Shiseido’s sales, about 79 percent come from its cosmetics division, about 9 percent from its toiletries division, which comprises soaps, hair-care products, mass market cosmetics, and fine toiletries and the remaining 11 percent from catch all others division which includes beauty salon products, health and beauty foods, pharmaceuticals, fashion goods and fine chemicals. In global, Shiseido now derives nearly 30 percent of its sales from outside of Japan. The company’s various products are manufactured at eight plants in Japan and a dozen abroad. BACKGROUND OF SHISEIDO Shiseido was founded in 1872 by Yushin Fukuhara and known as the oldest and fourth largest cosmetics company in the world. Arinobu Fukuhara, former head pharmacist to the Japanese...
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...Part 1 Project objectives and overall research approach 1.1 Introduction The topic chosen for the Research and Analysis Project is The Marketing Strategy of Shiseido China Co., Ltd (Shiseido) and its effectiveness. Marketing is essentially about marshalling the resources of an organisation to meet the changing needs of customers on whom the organisation depends. Organisations try to identify customers’ needs and develop products that will satisfy these needs through an exchange process (Palmer, 2004). 1.2 Reasons for Choosing the Topic Marketing is more than selling and advertising. It involves satisfying customer needs. The marketer should understand consumer needs; develop products and services that provide superior customer value; and price, distribute, and promote them effectively. Hence, marketing is the process by which companies create value for customers and build strong customer relationship to capture value from customers in return (Kotler et al., 2009). The main role of marketing in the organisation springs from the fact that marketing is the process via which an organisation creates value for its customers. Value is created by meeting customer needs. Thus, an organisation must define itself not by the product it sells, but by the customer benefit provided. Having created the value for its customers, the organisation is then entitled to capture a portion of that value through pricing. To remain a viable concern, the organisation...
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...Introduction Emerging markets are more important than ever in nowadays international businesses, they are increasingly making up a large share of many multinationals’ revenues and growths. Many multinationals believe their future success depends on how well they can master and win in these markets, they project share in their business based in emerging markets will increase 20-50% more in the next decade (Choudhary et. al., 2012). This study aims to reveal the motivations behind the multinationals and how multinationals succeed and fail in emerging markets with reference to relevant theories and examples. Theory of Multinational There are many theories analyzing why firms start to engage in foreign direct investments, the Eclectic Paradigm is a more integrated and general approach amongst the various, it explains how the multinational firms make their decisions and strategies by considering the Ownership Advantages (O), Location Advantages (L) and Internalizations factors (I). The theory incorporates ideas of market failure, location advantages and industrial organizations and is thus more holistic approach. The “O” paradigm explains why firms decide to start investing abroad because of possessing ownership-specific advantages relative to domestic firms, and the benefits can outweigh the transaction costs of operating in foreign markets and overcome the competitions of domestic firms, which lead to higher profitability with reduced costs. Examples of ownership-specific...
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...AY 2011 COMPARISON OF MARKETING STRATEGIES BETWEEN JAPANESE AND KOREAN COSMETICS COMPANIES IN THAILAND’S MARKET MATHAVEE REUNGSINPINYA Major in Business Administration GRADUATE SCHOOL OF COMMERCE WASEDA UNIVERSITY 35092351-8 C.E. PROF. GROSSBERG PROF. SUGIURA D.E. PROF. FUJITA Table of Contents CHAPTER 1. SECTION 1. SECTION 2. SECTION 3. SECTION 4. CHAPTER 2. SECTION 1. SECTION 2. SECTION 3. INTRODUCTION ................................................................................... 1 INTRODUCTION ............................................................................................ 1 OBJECTIVE OF THE STUDY........................................................................... 3 RESEARCH METHODOLOGY ......................................................................... 3 STRUCTURE OF PAPER ................................................................................. 4 INDUSTRY ANALYSIS .......................................................................... 5 THAILAND’S COSMETIC MARKET ................................................................. 5 JAPANESE COSMETICS IN THAILAND ........................................................... 8 KOREAN COSMETICS IN THAILAND ........................................................... 10 CHAPTER 3. MARKETING STRATEGIES OF MAJOR JAPANESE AND KOREAN COSMETIC COMPANIES ..............................................................................................14 SECTION 1. JAPANESE...
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...The Impact of Spokesperson Credibility on Product Favorability and Purchase Intention – A Study of International Cosmetic Brands with the Taiwanese Market as an Example University of Newcastle upon Tyne Business MSc International Marketing Chyi-wen Wang Supervisor: Professor Matthew Gorton 0 Dissertation Submission 2009 Student Name: Chyi-wen Wang Student Number: 098045495 Dissertation Title: The Impact of Spokesperson Credibility on Product Favorability and Purchase Intention– A Study of International Cosmetic Brands with the Taiwanese Market as an Example I do not give permission for this dissertation to be reproduced as a sample dissertation on Blackboard in future years. Signed:………………………………………………………………………………… 1 Abstract Taiwanese cosmetics and toiletries industries became prosperous, and the international cosmetics brands occupied most of the market shares. This research focused on the relationships between the source credibility and other variables. This is the quantitative research, and 301 participants received the questionnaires. All of the participants were divided into two groups: the low- and high-source-credibility group. In H1, the source credibility was proved to have positive influence towards the purchase intention and product favorability. H2 was investigated that the audiences’ favorability to the overall advertisements can influence the purchase intention. However, in H3, this research cannot prove the dominant...
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...MKTG203: Assignment 1 Thursday7.00_MR_17 New trends in consumer behaviour and brand personality have gained increased global attention, particularly in cosmetic products. This report will critically analyse the rapidly growing beauty and cosmetics market in China through the consumer behaviour concepts of consumer materialism and brand personality. Both of these aspects will be examined in relation to the similarities and differences present within the Australian and Chinese context. By exploring these two essential concepts of consumer behaviour, the report will highlight China’s growing interests and demands for imported skincare and beauty products, as well as a potential marketing opportunity for Australian cosmetic companies such as Aēsop. Background With an estimated worth of $19.49 billion, the cosmetic market is one of the largest industries stimulating the Chinese economy today (Datamonitor, 2013). A substantial growth of 18.7% in 2012 and a forecasted growth of 48.7% by 2017 (Euromonitor, 2013), has enabled the nation to become Australia’s largest trading partner including other Australian exports. Due to its dominant presence in the world economy, the general level of per capita income has increased progressively with minor improvements in chronic income inequalities between rural and urban populations in China. With higher disposable incomes and the endless choices in distinct cosmetics, many individuals are now seeking high-value...
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...Marketing Project Skincare Product Dermalogica’sClearingMattifier Cleanser Shiseido’s Purifying Cleansing Form Neutrogena’s Oil-Free Acne Wash 1. INTRODUCTION As we know, products can be classified as either business or consumer products, depending on the buyer’s intension and these products are marketed difference; they are marketed to different target markets and tend to use different distribution, promotion, and pricing strategies. In my paper, I choose the cleanser (Skincare product) as the consumer products to introduce and tell how they are different from each other as well as the Marketing Mix for all three products. Cleanser for acne skin ofDermalogica, Shiseido, and Neutrogena skincare products are three popular products that are sold at United State with larger market. First of all, as a brand, Dermalogica immediately upset the prevailing paradigm of beauty and glamour by classifying skin care as a health issue as opposed to a cosmetic concern. Just as it removed common irritants from the ingredient menu, Dermalogica also introduced a powerful new element into the brand identity: the specialized expertise of the professional skin therapist.Truly understanding your skin is the first step towards a lifetime of skin health. Start with a Dermalogica professional skin therapist: fortunately, with over 75,000 of them in over 50 countries, chances are you have a skin health expert just around the corner. Clearing mattifier cleanser of Dermalogica is a medicated...
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...Glinow: Organizational Behavior, Second Edition Part Four Organizational Processes Organizational Culture © The McGraw−Hill Companies, 2002 C H A P T E R 15 Organizational Culture AFTER READING THIS CHAPTER , YOU SHOULD BE ABLE TO : Learning Objectives I Describe the elements of organizational culture. I Discuss the importance of organizational subcultures. I List four categories of artifacts through which corporate culture is communicated. I Identify three functions of organizational culture. I Discuss the conditions under which cultural strength improves corporate performance. I Discuss the effect of organizational culture on business ethics. I Compare and contrast four strategies for merging organizational cultures. I Identify five strategies to strengthen an organization’s culture. McShane−Von Glinow: Organizational Behavior, Second Edition Part Four Organizational Processes Organizational Culture © The McGraw−Hill Companies, 2002 C arly Fiorina is taking Hewlett-Packard back to the future by reformulating the California-based technology company’s legendary culture, known as the H-P Way. “The H-P Way is about innovation; trust and respect and integrity; contribution to community; and performance,” says Fiorina, H-P’s first CEO hired from outside the company. The problem, she argues, is that employees have distorted these values over the years. “The H-P Way has been misinterpreted and twisted as a gentle bureaucracy of entitlement...
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...million. Cosmetics and toiletries generated four-fifths of sales (and green tea and health care the rest), placing the company among the top 30 worldwide. AmorePacific held a share of more than 30% of the Korean market for cosmetics, versus 8% for its leading local competitor, LG Household and Health Care, and 4% for L’Oréal, the world’s largest beauty products company and the leading multinational competitor in Korea.1 But although AmorePacific’s share of the Korean market had reached record levels and its overall operating margins of 15%+ ranked among the highest in the sector, its sales fell by 5% from 2003 to 2004—and its operating income by 7%—mostly because of the contraction and continued restructuring of the Korean market. International sales crossed KRW 100 billion (nearly $100 million) in 2004, after foreign direct investments of comparable magnitude, but continued to be unprofitable. Could AmorePacific fulfill its vision of becoming one of the top-10 cosmetics companies in the world, with $4 billion in sales by 2015,...
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...C H A P T E R Organizational Culture Learning Objectives After reading this chapter, you should be able to: • Describe the elements of organizational culture. • Discuss the importance of organizational subcultures. • List four categories of artifacts through which corporate culture is communicated. • Identify three functions of organizational culture. • Discuss the conditions under which cultural strength improves corporate performance. • Discuss the effect of organizational culture on business ethics. • Compare and contrast four strategies for merging organizational cultures. • Identify five strategies to strengthen an organization’s culture. 16 S I X T E E N 496 T o an outsider, PeopleSoft is one of the loopiest places on the planet. The Pleasanton, California, business management software company has nerf ball shootouts and minigolf tournaments in the hallways. Dress-down day is every day of the week. A white collar is usually a T-shirt. The bagels and gourmet coffee are free. Having fun is so ingrained that many employees—called PeoplePeople—say it’s the best place to have a bad day. PeopleSoft also values egalitarianism— treating everyone with respect and minimal status differences. Executives don’t have secretaries, special perks, or grandiose offices. “Don’t kiss up and slap down,” PeopleSoft cofounder Dave Duffield reminds everyone. In other words, give the bagel delivery guy the same respect as the company president. PeopleSoft is also extreme on...
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