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MAC Cosmetics Strategic Analysis

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Abbie Murray

on 30 June 2016

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Transcript of MAC Cosmetics Strategic Analysis

MAC was established in Toronto,Canada in 1984 when Frank Toskan and Frank Angelo cooked up their products in the kitchen and sold the line from a counter in a
department store. In 1995, Estee Lauder companies purchased a percentage of MAC's shares and by 1998 they had acquired the rest of the shares of the business.
PESTLE Analysis
Political - MAC production facilities are worldwide, one of which is in Markham, Ontario. Thus it has a duty rate of
Economic - In the Canadian economy, the consumer price index climbed 1.7% and faced an increase in core inflation of 2.2% compared to the year before

Porters five forces model
http://www.slideshare.net/zoeparisbrook/mac-makeup-marketingbrand-assessment slide 17
Overall, MAC has undergone controversy about the ethics of their testing in places like China, however they still remain one of the leading professional cosmetics brands that makes up a good part of Estee Lauders $11 billion net revenue in 2014.

MAC Cosmetics Strategic Analysis
Industry life cycle
Social - MAC targets people of all ages, sexes and races. The market is more conscious of Corporate Social Responsibility which negatively effects them due to involvement with Animal Testing.
Technological - MAC uses e-commerce to sell and distribute their products therefore benefiting the distribution channels of the business.

Legal - China requires all products imported to be tested on animals therefore MAC has to pay for this testing adversely affecting their ethics.
Environmental - MAC sells worldwide and therefore geographical locations are broad. MAC has 500 independent stores of which in the UK are based in and around city centers.
Mission, Aims and Objectives
“All Races, All Sexes, All Ages”
offer high quality, innovative products to meet the needs of all races, ages, and gender. To become a global brand and share the philosophy of M.A.C. around the world, by staying ahead of fashion trends and to consistently deliver trusted creativity. Viva Glam Lipstick is a collection that raises funds for M.A.C.'s AIDS FUND charity for men, women, and children with HIV/AIDS.

Estee Lauder Annual Report 2015
Market Mapping
Expand Product Range
Produce an app to compete with Loreal
Revamp old products
Expand into new demographics
Porters Value Chain
MAC is in the maturity stage as when sales decline they employ extension strategies to boost sales of certain products by revamping and relaunching some products.
Bowman's Strategic Clock
MAC falls between the Hybrid and Differentiation category. To the consumers the standard of MAC cosmetics is of a high value due to the variety of products and quality. However the Price of their cosmetics is relatively low compared to other brands of that quality.
Ansoff Matrix
MAC has been continually expanding their business's into targeting new markets in locations such as Africa and Latin America using their existing products thus meaning they fall into Market Development. However, in their existing markets they're also introducing new products by creating new collections such as collaborations with celebrities as well as exclusive products such as the vibe tribe collection thus meaning they're in product development as well.

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