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KORA Organics

Your Ultimate Organic Skincare
by

Nancy Tran

on 17 May 2011

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Transcript of KORA Organics

Your Ultimate Organic Skincare ..one of the Victoria secret angels You know her as.. ..ambassador for
portmans & david jones You've seen her in.. ..fashion & beauty shoots Reference The KORA Organics story.. "KORA Organics is a reflection of my passion for living a healthy, organic lifestyle." Miranda Kerr studied Nutrition and Health Psychology, at the Academy of Natural Living.

After trying products from all over the world, Miranda was not able to find an organic range of skincare that contained all the beneficial ingredients she wanted for her skin (Belfred, 2010). So in 2009, she launched her own organic skincare range, KORA Organics.

KORA is available exclusively at David Jones and online via www.koraorganics.com website. It features moisturisers, facial mists and cleansers. Current marketing situation Objectives & marketing strategy Action programs Market situation Product situation Competition Distribution channel The macroenvironment Current marketing situation Your ultimate organic skincare Reference Australian Bureau of Statistics (2008), Time spent on cultural activities, 26 May, viewed 16 April, <http://www.abs.gov.au/ausstats/abs@.nsf/Products/98DC120893DF9897CA2574520010720A?opendocument>.

AFP (2009), Study finds people still spending on beauty, 12 January, viewed 19 March 2011, <http://www.google.com/hostednews/afp/article/ALeqM5gzIB0qCYyZri5sYoCttmoFNAfMkw>.

Belfred, M (2010), Taking kerr of business, media release, 16 November, Fashion Quarterly New Zealand, viewed 19 March 2011, < http://www.koraorganics.com/press/detail/fashion-quarterly-new-zealand-taking-kerr-business/284>.

Datamonitor (2009), Global skincare, viewed 19 March 2011, < http://www.datamonitor.com/store/Product/skincare_global_industry_guide?productid=28DC86E3-27CF-447E-A579-4E3DEE8279A9 >.

IBISWorld (2010), Cosmetic and Toiletry Retailing in Australia, December, viewed 15 March 2011, < http://www.ibisworld.com.au/industry/default.aspx?indid=1879>.

Kotler, P, Adam, S, Denize, S & Armstrong, G (2009), Principles of marketing, 4th edn, Pearson, Frenchs Forest, NSW, p.349.

MacIntyre, A (2008), Organic skincare products take over supermarkets, 2 August, viewed 16 April 2011, < http://www.monstersandcritics.com/lifestyle/life/news/article_1421082.php/Organic_skincare_products_take_over_supermarkets >.

Nielsen (2010), Pharmacy state of the industry report, June, viewed 16 April 2011, < http://au.nielsen.com/site/documents/NielsenOTCReportRetPharmJune2010.pdf>. You know her as.. You've seen her in.. ..one of the Victoria Secret angels ..ambassador for portmans & david jones ..fashion and beauty photoshoots The KORA Organics story.. "KORA Organics is a reflection of my passion for living a healthy, organic lifestyle." Miranda Kerr studied Nutrition and Health Psychology, at the Academy of Natural Living.

After trying products from all over the world, Miranda was not able to find an organic range of skincare that contained all the beneficial ingredients she wanted for her skin (Belfred, 2010). So in 2009, she launched her own organic skincare range, KORA Organics.

KORA is available exclusively at David Jones. It features moisturisers, facial mists and cleansers. Current marketing situation.. Current marketing situation.. According to the Australian Bureau of Statistics, Australian households spent in excess of $6 billion on cosmetics, toiletries and other personal care items in 2005-2006 (IBISWorld, 2010). Despite the economic downturn, an international survey conducted by Synovate found that 41 per cent of people would still spend the same amount on cosmetics as they did before the downturn, while only 27 per cent would cut down (AFP, 2009). This shows that people are still willing to pay for the price of beauty. In today’s overcrowded beauty market, there are numerous range of beauty and skincare products available. The skincare market consists of facial care, body care, suncare, hand care, depilatories and make-up remover products. The facial care is the largest segment of the skincare market, as it accounts for 63 per cent of the market’s total value (Datamonitor, 2009). ..market situation Family life cycle and size are insignificant when it comes to target market. Traditionally, baby boomers were considered the largest consumers of skincare products. However, the expansion in eco-consumerism and celebrity products has seen a much more diverse range of ages interested in purchasing skincare products (IBISWorld, 2010). Consequently, the target market for KORA includes females of all ages, with an emphasis on people aged 25 and older as they are the major consumers of skincare products. The result of the mixed research conducted via surveying 50 people and holding two focus groups for people aged 16 to 30 and 31 to 45 supports this idea. The survey also shows brand name and the ingredients in the product were the main concerns, followed by price and the size of the product. ..product situation The pricing strategy used for KORA products is the value-based pricing where the
key to pricing is by using “buyer’s perceptions of value” to determine the price. Through the use of non-price variables in the marketing mix, the company is able to build up perceived value in buyers’ minds (Kotler etal, 2009, p. 349). KORA prides itself in using organic ingredients to formulate its product, giving rise to the same result as other expensive products but with fewer chemicals. Consumers are willing to pay more for organic products because of the perception that it is better quality (MacIntyre, 2008). Also, organic products are more expensive because the ingredients are more expensive as it is more labour intensive and has to confirm to more stringent regulations for it to be classified as an “organic product”. Breadth – 7 broad lines
Length – KORA carries 15 products
Depth – there is only one of each product therefore depth stays the same
Consistency – these products are closely linked in their end use. All their functions are to provide consumers with clearer skin. They all use the same distribution channel and can all be purchased at David Jones or online via the www.koraorganics.com website. Miranda Kerr herself is the brand of KORA. She lives a healthy organic life since growing up and continues to do so today. She encourages her family, friends and fans to also life a healthy life and as a result, KORA was developed to share this passion. “I grew up in a small country town in Australia, with a family that embrace and understand the importance of living close to the land and in balance with nature. It taught me about the benefits of a healthy, organic lifestyle. That's why I'm thrilled to be creating a certified organic product, which means, its best for the planet, best for me personally and best for you.” Current marketing situation.. Current marketing situation.. ..distribution channel ..competition KORA have the smallest number of product mix in comparison to the following direct competitors. However, the limited number of product range will allow KORA to focus more on each individual product to ensure the highest quality. In addition, Miranda Kerr’s involvement in developing the product will add to KORA’s brand image which will give KORA an advantage over the other competitors. Direct competition Indirect competition KORA products have featured in a number of magazines such as Cleo, Shop Til You Drop & Vogue Australia. There are also social network websites specifically for KORA via Facebook and Twitter. Despite these distribution channels, the survey and focus group indicates that many potential consumers are unaware of the product. Therefore, this area requires significant improvement as only 4 per cent of people surveyed purchase their skincare products online, while 24 per cent through department stores, 28 per cent through pharmacies and 38 per cent through supermarkets. Currently KORA products are available exclusively at David Jones and can also be ordered online via the www.koraorganics.com.au website. ..macroeconomic environment SWOT Marketing objectives.. The result of the survey and focus group indicated the following issues that KORA's marketing strategy needs to address: Lack of availability of product
Lack of awareness of product
High price in comparison to competitors (direct & indirect) As a result, the marketing strategy to be implemented will need to encourage consumer to experiment and upgrade their skincare product. Therefore, the objectives of KORA’s marketing strategy are: To increase brand/product awareness by 50% in the next year through promotion and additional advertising on television and via billboards
To increase product availability by 30% by expanding product channels
To increase sales by 20% in the next year Action plan.. The first issue to address is the of lack of brand/product awareness. Through: Promotional appearance at David Jones store on special days such as Mothers Day
Give out sample bags to fans during special events such as Melbourne
Television (TV) advertising
Billboards at busy bus and train stations TV is a powerful advertising medium. According to the Australia Bureau of Statistics, on a daily basis, 87 per cent of Australians watched TV for an average of just less than 3 hours (2008). Research has also shown that 38 per cent said advertising has influenced them to buy health and beauty products (Nielsen, 2010). This marketing strategy is currently used by indirect competitors such as Neutrogena & Dove and it is proving to be a success. The result of the focus group supports this idea, as majority of the respondents confirmed, TV advertising is most effective as that is how they became aware of those everyday known brands sold at supermarkets. The method of advertising via billboards across business locations such as the centre of each capital city in Australia and even at busy bus and train stations where students, workers of all age who uses public transport to get to work, ensures these target market will encounter the advertisement. Once consumers are more aware of the product and demand increases, the second part of KORA’s marketing strategy is to expand its product availability. KORA should open up its own store as oppose to making it available in supermarkets and pharmacies where indirect products are sold. This way, KORA can continue to uphold its product image as many respondents of the focus group confirms they see products in department stores and in its own store to be more superior in terms of quality then those sold in supermarkets and pharmacies. Such technique is used by a cosmetic company known as Napolean Finally, to retain new customers, KORA could offer membership or loyalty cards which gives discounts on the next purchase. This technique could also overcome the issue where the price for the product is too high in comparison to competitors. In addition, KORA could advertise special sale and promotion. According to the Nielsen’s Global Online Consumer Survey, 55 per cent of respondents said that an advertisement that announces a special sale or promotion is said to be the most influential factor in purchasing a product (Nielsen, 2009). Perdis. Like Napolean, KORA’s own store can include facilities that allows the customer to try the products before buying right there and then. Your ultimate organic skincare You know her as.. You've seen her in.. ..one of Victoria Secret angels ..embassador for portmans & david jones ..fashion & beauty photoshoots The KORA Organics story.. "KORA Organics is a reflection of my passion for living a healthy, organic lifestyle" Miranda Kerr studied Nutrition and Health Psychology, at the Academy of Natural Living.
After trying products from all over the world, Miranda was not able to find an organic range of skincare that contained all the beneficial ingredients she wanted for her skin (Belfred, 2010). So in 2009, she launched her own organic skincare range, KORA Organics.
KORA is available exclusively at David Jones. It features moisturisers, facial mists and cleansers. Current marketing situation.. Current marketing situation.. SWOT Marketing objectives.. Action plan.. Reference Australian Bureau of Statistics (2008), Time spent on cultural activities, 26 May, viewed 16 April, <http://www.abs.gov.au/ausstats/abs@.nsf/Products/98DC120893DF9897CA2574520010720A?opendocument>.

AFP (2009), Study finds people still spending on beauty, 12 January, viewed 19 March 2011, <http://www.google.com/hostednews/afp/article/ALeqM5gzIB0qCYyZri5sYoCttmoFNAfMkw>.

Belfred, M (2010), Taking kerr of business, media release, 16 November, Fashion Quarterly New Zealand, viewed 19 March 2011, < http://www.koraorganics.com/press/detail/fashion-quarterly-new-zealand-taking-kerr-business/284>.

Datamonitor (2009), Global skincare, viewed 19 March 2011, < http://www.datamonitor.com/store/Product/skincare_global_industry_guide?productid=28DC86E3-27CF-447E-A579-4E3DEE8279A9 >.

IBISWorld (2010), Cosmetic and Toiletry Retailing in Australia, December, viewed 15 March 2011, < http://www.ibisworld.com.au/industry/default.aspx?indid=1879>.

Kotler, P, Adam, S, Denize, S & Armstrong, G (2009), Principles of marketing, 4th edn, Pearson, Frenchs Forest, NSW, p.349.

MacIntyre, A (2008), Organic skincare products take over supermarkets, 2 August, viewed 16 April 2011, < http://www.monstersandcritics.com/lifestyle/life/news/article_1421082.php/Organic_skincare_products_take_over_supermarkets >.

Nielsen (2010), Pharmacy state of the industry report, June, viewed 16 April 2011, < http://au.nielsen.com/site/documents/NielsenOTCReportRetPharmJune2010.pdf>.

Sykes, D & Crawford, K (2008), HSC business studies: getting better results, RedPeg Publishing, Belconnen List. Group Members: Nancy Tran, Chanelle El-Indari, Andrea Boufrancis, Jade-Lee Mackney & Delora Chi ..market situation According to the Australian Bureau of Statistics, Australian households spent in excess of $6 billion on cosmetics, toiletries and other personal care items in 2005-2006 (IBISWorld, 2010). Despite the economic downturn, an international survey conducted by Synovate found that 41 per cent of people would still spend the same amount on cosmetics as they did before the downturn, while only 27 per cent would cut down (AFP, 2009). This shows that people are still willing to pay for the price of beauty. In today’s overcrowded beauty market, there are numerous range of beauty and skincare products available. The skincare market consists of facial care, body care, suncare, hand care, depilatories and make-up remover products. The facial care is the largest segment of the skincare market, as it accounts for 63 per cent of the market’s total value (Datamonitor, 2009). Family life cycle and size are insignificant when it comes to target market. Traditionally, baby boomers were considered the largest consumers of The result of the mixed research conducted via surveying 50 people and holding two focus skincare products. However, the expansion in eco-consumerism and celebrity products has seen a much more diverse range of
ages interested in purchasing skincare products
(IBISWorld, 2010). Consequently, the target market for
KORA includes females of all ages, with an emphasis on
people aged 25 and older as they are the major consumers
of skincare products. groups for people aged 16 to 30 and 31 to 45 supports this idea. The survey
also shows brand name and the ingredients in the product were the
main concerns, followed by price and the size of the product. ..product situation Current marketing situation.. The pricing strategy used for KORA products is the value-based pricing where the key to pricing is by using “buyer’s perceptions of value” to determine the price. Through the use of non-price variables in the marketing mix, the company is able to build up perceived value in buyers’ minds (Kotler etal, 2009, p. 349). KORA prides itself in using organic ingredients to formulate its product, giving rise to the same result as other expensive products but with fewer chemicals. Consumers are willing to pay more for organic products because of the perception that it is better quality (MacIntyre, 2008). Also, organic products are more expensive because the ingredients are more expensive as it is more labour intensive and has to confirm to more stringent regulations for it to be classified as an “organic product”. Breadth – 7 broad lines
Length – KORA carries 15 products
Depth – there is only one of each product therefore depth stays the same
Consistency – these products are closely linked in their end use. All their functions are to provide consumers with clearer skin. They all use the same distribution channel and can all be purchased at David Jones or online via the www.koraorganics.com website. Product map Miranda Kerr herself is the brand of KORA. She lives a healthy organic life since growing up and continues to do so today. She encourages her family, friends and fans to also life a healthy life and as a result, KORA was developed to share this passion. “I grew up in a small country town in Australia, with a family that embrace and understand the importance of living close to the land and in balance with nature. It taught me about the benefits of a healthy, organic lifestyle. That's why I'm thrilled to be creating a certified organic product, which means, its best for the planet, best for me personally and best for you” ..competition Direct competition Indirect competition KORA have the smallest number of product mix in comparison to the following direct competitors. However, the limited number of product range will allow KORA to focus more on each individual product to ensure the highest quality. In addition, Miranda Kerr’s involvement in developing the product will add to KORA’s brand image which will give KORA an advantage over the other competitors. ..distribution channel KORA products have featured in a number of magazines such as Cleo, Shop Til You Drop & Vogue Australia. There are also social network websites specifically for KORA via Facebook and Twitter. Despite these distribution channels, the survey and focus group indicates that many potential consumers are unaware of the product. Therefore, this area requires significant improvement as only 4 per cent of people surveyed purchase their skincare products online, while 24 per cent through department stores, 28 per cent through pharmacies and 38 per cent through supermarkets. Current marketing situation.. Currently KORA products are available exclusively at David Jones and can also be ordered online via the www.koraorganics.com.au website. ..macro-environment The result of the survey and focus group indicated the following issues that KORA marketing strategy needs to address: Lack of availability of product
Lack of awareness of product
High price in comparison to competitors (direct & indirect) As a result, the marketing strategy to be implemented will need to encourage consumer to experiment and upgrade their skincare product. Therefore, the objectives of KORA’s marketing strategy are: To increase brand/product awareness by 50% in the next year through promotion and additional advertising on television and via billboards
To increase product availability by 30% by expanding product channels
To increase sales by 20% in the next year The strategies can be discussed through the following P’s of marketing: ..promotion ..price ..product ..placement Promotion is about effective communication with customers (Sykes, 2008). Despite current marketing and advertising of KORA products, survey and focus group confirms there is still a lack of brand/product awareness.

To address this issue, Miranda Kerr should:
do promotional appearance at David Jones store on special days such as Mothers Day
give sample bags to fans during special events such as Melbourne Race
television (TV) advertising

TV is a powerful advertising medium. According to the Australia Bureau of Statistics, on a daily basis, 87 per cent of Australians watched TV for an average of just less than 3 hours (2008). Research has also shown that 38 per cent said advertising has influenced them to buy health and beauty products (Nielsen, 2010). This marketing strategy is currently used by indirect competitors such as Neutrogena & Dove and it is proving to be a success. The result of the focus group supports this idea, as majority of the respondents confirmed, TV advertising is most effective as that is how they became aware of those everyday known brands sold at supermarkets. Another method to increase awareness is advertising via billboards across business locations such as the centre of each capital city in Australia and even at busy bus and train stations where students, workers of all age who uses public transport to get to work will encounter the advertisement. Price is the payment required to purchase a product (Sykes, 2008). The survey shows that more than half the respondents are willing to spend $21-$30 on a moisturiser. Price is an important factor as considered by 47 per cent of respondents while 25 per cent said it was very important. It may not be feasible to reduce the current price of KORA products, however an alternative option is through the use of membership or loyalty cards, which gives discounts on the next purchase. Not only will this technique help retain new customers, it will also overcome the issue where the price for the product is too high in comparison to competitors. In addition, KORA could advertise special sale and promotion. According to the Nielsen’s Global Online Consumer Survey, 55 per cent of respondents said that an advertisement that announces a special sale or promotion is said to be the most influential factor in purchasing a product (Nielsen, 2009). A product refers to a good or service, idea or any combination of the three that can be offered in an exchange. The result of the survey and focus group highlights the product size issue, in which 56 per cent of respondents stated that size is an important factor. Therefore, one improvement that can be made on product is to produce various sizes for each product. While KORA’s current packaging may not stand out from the rest, restructuring its packaging is not necessary as 49 per cent of respondents confirms packaging is not very important. Once consumers are more aware of the product and demand increases, the second part of KORA’s marketing strategy is to expand its product availability and accessibility. KORA will negotiate with David Jones to improve the location of the product in the store to somewhere near the entrance where it is able to be seen by more potential customers. The shelf will also be turned into a stand where an assistant can help customers with any enquiries they have about the product. KORA should also open up its own store as oppose to making it available in supermarkets and pharmacies where indirect products are sold. This way, KORA can continue to uphold its product image as many respondents of the focus group confirms they see products in department stores and in its own store to be more superior in terms of quality then those sold in supermarkets and pharmacies. Such technique is used by a cosmetic company known as Napolean Perdis. Like Napolean, KORA’s own store can include facilities that allows the customer to try the products before buying right there and then.
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