MKTG1205 Marketing Principles Situation Analysis Report Obagi Medical ( Obagi Toner) PDF

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MKTG1205 _ MARKETING PRINCIPLESSITUATION ANALYSIS REPORTOBAGI MEDICAL (OBAGI TONER)STUDENTS:Thai Thao Nguyen S Trinh Yen Van S Tran Tan Phat S Le An S Nguyen Duy Minh SDo Quoc Nam SDue date: 6PM, 18.Lecturer: Hua My Sang **TABLE OF CONTENT: I. SITUATION ANALYSIS: 1 Description: 1.1: 1.2 Statement: 1...

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MKTG1205 _ MARKETING PRINCIPLES SITUATION ANALYSIS REPORT OBAGI MEDICAL (OBAGI TONER)

STUDENTS:

Thai Thao Nguyen Trinh Yen Van Tran Tan Phat Le An Nguyen Duy Minh

S3911923 S3885976 S3878775 S3880884 S3878298

Do Quoc Nam

S3877016 Due date: 6PM, 18.04.2021 Lecturer: Hua My Sang

TABLE OF CONTENT: I. SITUATION ANALYSIS: 1.Company Description: 1.1.History: 1.2.Mission Statement: 1.3.Vision Statement: 1.4. Obagi executive - Steve Carlson: 1.5. Obagi in the Vietnamese market: 2.Product Description: 2.1.Function & Features: 2.2.Style & Design: 2.3.Market II.

III.

IV.

V.

2.4.Brand Awareness: MICRO ENVIRONMENT: 1.Competitors: 2.Suppliers: 3.Public: 3.1. General Public: 3.2. Media Public: 4.Customer: 4.1.Consumer market: 4.2.Retailer market: 4.3.International market: 5.Intermediaries: 5.1.Reseller: 5.2.Marketing Agency: 6.Company MACRO ENVIRONMENT: 1.Demographic: 2.Economic: 3.Natural: 4.Technology: 5.Political: 6.Culture: SWOT: 1.Strengths: 2.Weaknesses: 3.Opportunities: 4.Threats: STDP:

Share:

VI. VII. VIII.

1. Segmentation: 2. Targeting: 3. Differentiation: 3.1: Image: 3.2: Distribution: 3.3: Product: 3.4: Service: 4. Positioning map: CONCLUSION: REFERENCES: APPENDIX:

I. SITUATION ANALYSIS: ( Nam ) 1.Company Description: Obagi is a cosmetic brand originating from the USA and was established in 1988. After more than 30 years of research and development, now the brand has many outstanding products and is exported all over the world. The founder of Obagi is Dr.Zein Obagi-a pioneer in finding the optimal solution for many skin diseases and combating harmful agents to recreate healthy skin. At the same time, he was also the first in the world to research a formula for hyperpigmentation and chemical skin peels. The treatment principles that he put forward are still evaluated as the “gold standard" in the cosmetology industry. 1.1.History: Obagi - the brand was born in 1988 by the world’s leading dermatologist Dr, Zein Obagi and a team of auxiliary dermatology specialists.Through more than 30 years of research and development, Obagi cosmetics are increasingly innovating in production technology, enhancing features and quality suitable for all skin types in many different lands. The Obagi brand is very popular in many countries with products tailored to Asian women’s skin. 1.2. Mission Statement - A Leader in Skin Health: According to Obagi Company, they want their customers to be more confident and fearless in the future by making their customers feel better about themselves and have a good look at the first time. All of their products are designed to minimize the skin damage, sunburn, many types of acne and other skin care professionals. 1.3.Vision Statement: Obagi Company has 6 main targets to achieve: ● Absolutely do not use animals for testing. ● Using the most modern, patented technology to quickly and safely affect the skin. ● Research and develop separately each product line to best suit the mechanism and biological structure of the skin. ● Create products based on in-depth knowledge, tested and clinically tested with absolute safety.

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Publicly and transparently everything about product ingredients usage schedules and effectiveness of use in each stage. ● Absolutely do not put unclear information. The advantages if Obagi Company has achieved that target: They will have the trust from their customers by not using any animal resources and contribute hands to protect the environment. The Company will be kept an eye on because they use the highest technology with high quality to help the people be younger and more beautiful. The trust is the most important in business and Obagi is the leading company that they publicize their process and ingredients usage schedules and effectiveness of use in each stage. Always show all of the information to the customers and the government. 1.4. Obagi executive - Steve Carlson: Steve Carlson joined Obagi Medical Company in March 2005 as the President. He became the CEO of Obagi with a treasure of knowledge about the combination of outstanding strategic thinking, manager skill of an expert, and deep industry experience, particularly for bringing new products to market. 1.5 Obagi in the Vietnamese market: Obagi Medical started in Vietnam on July 28, 2018 with the mission that is the scientific solution of the skin touch. This company has more than 200 experts about skin care and many medical teams with high experience. Coming to Vietnam, Obagi Medical wants to create a sustainable, long term development through focusing on research and customer oriented advertising strategy. 2. Product Description - Obagi Medical Toner: In Vietnam, environmental pollution is the biggest problem that we are facing. That issue also affects our health, especially our skin. No matter how good a facial cleanser is, it can not remove all of the dirt deep in the pores. To solve this problem, Obagi Medical has produced Obagi CLENZIderm Pore Therapy, it is a special treatment that helps deep clean pores, cleanse your skin. 2.1. Function and features: The exfoliating ingredients in Obagi CLENZIderm Pore Therapy gently exfoliate the dead cells that clog pores, preventing the skin’s recovery process. Using the product after cleansing helps the skin to effectively absorb the next step of acne treatment. That product can be appropriate to every age and every gender. 2.2. Style & Design: The design of Obagi CLENZIderm Pore Therapy is the basic one. In other words, it is minimal and easy to recognize. The bottle is wide to contain enough 148mL liquor and have an intrusion paper behind the bottle to guide customers how to use it.

2.3. Market Share: Based on a 2011 study by Kline & Co. Obagi is a leader company in the skin care area in the physician - dispensed channel, with an estimated 30,1% market share compared with other companies, nearly two times the market share of the next largest competitors. 2.4. Brand Awareness: According to Vietnamnews, Obagi is becoming one of the thriving companies in health and beauty, especially in skin care and facial. With a variety of models and types of body care, Obagi gradually builds trust among users with evidence that Obagi is popular in all regions and many other countries. II. MICRO ENVIRONMENT ( Le An ) 1. Competitors Competitors are companies that manufacture and sell the same product or service. If the company’s performance is unsatisfactory, competitors could take their market share. 1.1 Direct competitors In Viet Nam, the biggest competitor of Obagi is Estée Lauder which is a well-known premium beauty brand. Obagi and Estée Lauder have many similar points such as originated from the USA, focused on premium quality products with higher-price. Moreover, Estée Lauder took approximately 5.5% of the total market and ranked second position for premium beauty brands in Viet Nam ( Appendix 1 ). Nonetheless, a supreme advantage of Obagi Medical compared to Estée Lauder is the online purchase website. In fact, the official website of Estée Lauder doesn't allow consumers to buy their products online (Appendix 2). 1.2 Indirect competitors In addition, some functions of toner are minimizing the appearance of pores, moisturizing your skin , removing oil and refreshing your skin. However, some products that could satisfy the similar functions are mineral spray, moisturizer and creme cleanser. Compared with premium beauty brands in Viet Nam, Vichy mineral spray and Clinique moisturizer are very common. Also, Vichy held about 1,7% and Clinique took almost 4,1% for brand shares premium beauty ( Appendix 1 ) 2. Suppliers Supplier relates to partners of companies which supply materials and ingredients to manufacture and launch products. Sirona Biochem is a company that provides innovative skin lightening compounds ( TFC-984 ) for Obagi. This compound is developed by Sirona’s scientists in France. Furthermore, several tests have been conducted to verify the efficiency of TFC-984 (Sirona Biochem 2014). Rohto also sells and produces products with ELASTIderm's technology for Obagi. Moreover, Obagi-branded products which contain vitamin C, Triple Peel and platinum are manufactured and distributed in Rohto ( Thepharmaletter September 2008 ) With potential and credible suppliers, Obagi can guarantee the safety and quality of

their products which could enhance their market share significantly. 3. Public Public include customers, staff, journalists, … that can impact the company’s image directly and indirectly. 3.1 General public As a skin-care and beauty brand, Obagi focuses on the difference in beauty and inclusion. As a result, Obagi Medical associated with the International Cultural Diversity Organisation (ICDO) and Project Implicit to launch an worldwide initiative ( Aesthetic 2019 ). The aim of this initiative is to elevate the global dialogue about diversity and inclusion, and recognizing our own unconscious biases ( ICDO 2019, para. 1). Moreover, Obagi Medical has provided a site called Skin Tone Implicit Association Test (Cision 2019) and donate $150,000 for ICDO with the hashtag #SKINCLUSION. Thus, this campaign has attracted people around the world who have different skin tones. Additionally, Obagi also partners with Grace Strolbel who is a model with down syndrome. Their mission is to motivate disabilities to feel strong, be fearless, stand up for others and feel the beautiful in their own skin ( ICDO 2020). Thus, the partnership gained positive support and attracted many disabilities 3.2 Media public After 12 months, SKINCLUSION initiative with the contribution of Obagi Medical has been succeeded. The initiative received huge attention from reputable and worldwide newspaper headlines such as Forbes, People Magazine, Elle, Harper’s Bazaar, Nowadays, Show, Yahoo and many others ( ICDO 2019 ) In addition, Obagi can utilize social media and TVC platforms for promoting their products. Indeed, Obagi facebook fanpage has 169 thousand likes and receives positive feedback from customers. Furthermore, on Obagi website, it provides a Skin Analyzer Quiz for customers to easily choose the proper products (Appendix 7). 4. Customer Customers could be people or organizations that purchase company products and impact the company’s profit. 4.1 Customer market Due to Euromonitor, premium beauty brands could grow strongly in Viet Nam. People are willing to pay and trust for the quality of premium products ( Euromonitor, 2020). Obagi products consist of cosmetics and skin-care products with higher-price compared to its market but it offers credible and quality experiences. Therefore, it is matched with customers from middle-class to upper-class. According to Euromonitor, the proportion of people who are above 60 years old surges from 9.9% in 2011 to 12.0% by the end of 2018. Consequently, anti-aging products are anticipated to rocket significantly and will reach 25% in 2049 (Euromonitor, 2020). Recognizing the current trend, Obagi has launched anti-aging products for elders from 40 to 60 years old (Appendix 3). In recent years, Vietnamese customers tend to trust and purchase foreign products with the belief that international products could offer

more quality than local products, despite higher price (Euromonitor, 2020). As an American beauty brand, Obagi has potential opportunities to develop and sell their products in the VietNam market. 4.2 Retailer market In general, Obagi is well-known for skin-care and clinical testing. Thus, Obagi products could be found in most Skin centers, Pharmaceutical stores and Spas where they can evaluate and consult the condition of the customer's skin. Customers can also find Obagi’s products on e-commerce platforms (Appendix 4) Q&Me( 2020) 4.3 International market Obagi product is sold in plenty of nations around the world such as Jordan, Algeria, Bahrain, Brunei, Cambodia, Caribbean, Colombia, Costa Rica, Democartic Republic of the Congo & Ghana, Ecuador, Egypt, England, Guatemala, India, Indonesia, Ireland, Italy, Kenya, Kuwait,Lebanon, Malaysia, Mexico, Morocco, the Netherlands, Norway, Oman, Panama, Philippines, Poland, Qatar, Scotland, VietNam, Singapore, South Africa, South Korea and many other countries. 5. Marketing Intermediaries Marketing intermediaries are also known as brokers which help the company to promote, sell or distribute the products more effectively. 5.1 Reseller Obagi toners are available in plenty of skin care centers, spas and pharmaceutical stores in urban areas. Some of them are Hasaki Beauty and Spa, Quang Thuy Pharmaceutical store and ED Beauty Skin Center. Moreover, Obagi toner can be purchased on e-commerce platforms such as Shopee, Lazada and Tiki. 5.2 Marketing agency Obagi has recognized the importance of collaboration with celebrities. Therefore, Priyanka Chopra has been chosen as Obagi ambassador for their initial advertising campaign ( luxurylaunches 2019 )(Appendix 5). Priyanka Chopra who is a beautiful Indian actress, singer and the national and global UNICEF Goodwill Ambassador for child rights in 2010, 2016 ( Wiki n.d ). With the participation of an Indian Miss World, Obagi could raise the customer trust and their sales. With the development of social media platforms, Obagi also takes advantage of Facebook, Instagram and Youtube. On the Obagi youtube channel , they have conducted a consultation about presenting skin-care products with Dr.Vo Thi Bach Suong (Appendix 6). She is known as an experienced doctor of dermatology at Medical and Pharmaceutical University Hospital. Consequently, customers could have sufficient knowledge about Obagi products. 6. Company Obagi Medical is a pharmaceutical company that develops, markets and sells, and is the

leading provider of proprietary topical aesthetic and therapeutic clinically-proven skin care systems in the physician-dispensed market ( Linkedin n.d). Besides, the company expanded their operation through distribution partners in over 42 countries. Obagi principal strategies for development are developing clinics to validate skin health products, systems for dermatology, plastic surgery and improving common, visible skin conditions ( Linkedin n.d)

III. MACRO ENVIRONMENT: ( Thai Thao Nguyen ) The macro marketing environment consists of elements, major social forces that affect the entire micro-marketing environment, business sectors and on the Marketing decisions of the businesses. The corporations cannot change these environmental factors. All information on Macro Environment influences in Vietnam on Obagi with the CLENZIderm M.D.® Pore Therapy product is analyzed below. 1.

Demographic factor

At the end of 2020, Vietnam's population was estimated at nearly 97.8 millions people according to the latest data from the United Nations. In 2021, it is expected to reach 98.5 millions citizens. Vietnam is ranked 15th in top countries which has the largest population in the world, accounting for 1.25% of the world's population with a growth rate of 0.91%. Furthermore, it has half the population of women, most of them aged between 15 and 64, which includes the target customers of the CLENZIderm M.D.® Pore Therapy Asm (Dan So, 2021). It is observed an continuous increase in Vietnam female population, which may gain demand for the products and create a potential market for Obagi products to grow. In addition, the number of women who are white-collar and living in the urban area is gradually increasing. They tend to pay more attention to body care; thus, it leads to the growth in demand of the beauty industry. According to a survey conducted in January 2020 by Q & Me, with 458 women aged over 16, providing an overview of the situation of Vietnamese cosmetic consumption (Brands Vietnam, 2020). It proved that the number of people doing skincare has been rising every day, in which 79% of them use skin care goods once a week or more often and over the half do skin care as a daily routine (To, 2021). Those numbers have seen a non-stop rise and significantly contribute to the development of the skin care industry. 2. Economic factor In 2020, there are plenty of great challenges and difficulties for the global economy including

Vietnam. Due to the negative impacts of the Covid-19 epidemic, it is forecasted that the whole world economy will suffer the most serious recession, with the dramatic and severe decline of some major industries. However, Vietnam's economy is predicted to maintain a sustainable development with GDP growth rate estimated at 2.91% (General Statistic Office, 2021). It helps the Vietnamese to maintain a more stable life than many other countries. Thus, Vietnamese citizens still are able to afford daily necessities and easily adapt to changes of the economy when going back after social distancing in 2021. In the cosmetics industry, while hair care, makeup, and perfume products suffered a lot during this period, the skincare ones did not (Tomorrow Marketers, 2020). Hence, participating in the Vietnam market is a worthy investment of Obagi. Furthermore, the faster Vietnam's economy grows, the more income and higher living standard Vietnamese citizens earn. With higher income, Vietnamese tend to spend more on self-care products and even more expensive ones. Therefore, it may be an opportunity for Obagi. 3. Natural factor It is proposed that products made from eco-friendly ingredients will be favored by consumers, so in order to keep up with this trend, the cosmetics industry needs to integrate sustainability. (Tomorrow Marketers, 2020). Vietnam customers tend to buy more skincare products made from natural ingredients with affordable prices. However, CLENZIderm M.D.® Pore Therapy almost contains no natural ingredients. A high price for a not really ecofriendly skincare product is such a big obstacle for Obagi to attract Vietnamese users. 4. Technological factor Since the beginning of the epidemic, ecommerce has been a burst phenomenon and it is a potential for suppliers to boost skincare products for sale on this platform. However, with some global companies like Obagi, it is such a risk as customers may face fake product channels on online shopping with lower prices. Not only does Obagi reduce in revenue, but it also may lose trust from customers if there are any problems with them when they are using fake products. With the development of digital, ecommerce is a good opportunity for Obagi to reach potential customers but also a major challenge if they do not use it in proper ways. Furthermore, those ecommerce platforms also create a fierce competition for all skincare as well as cosmetic companies as they need to adapt to those market campaigns. Although it is a cooperative relationship, cosmetic companies, including Obagi, still significantly depend on ecommerce platforms. It is harder for them to advertise themselves and they have to generate promotion to boost sales in some specific flash sales campaign. However, with the huge

numbers of users on online platforms, ecommerce sites can provide Obagi its customers data, which is similar to Obagi target audiences, to run advertising campaigns. It may reduce Obagi's cost of researching while advertising. 5. Political factor Vietnam government has established many policies to encourage direct investment from MNC. It is such a chance for Obagi to participate in the Vietnam market. Those policies include financial incentives, tax, import and export tariffs, etc. 6. Cultural factor Beauty is a natural need of humans in general and of women in particular. It is obviously right for Vietnam females as well. Vietnamese women have had beauty habits for a long time (Truong, 2013). In the past, Vietnam women only paid attention to beauty treatments with teeth and hair such as dyeing teeth and long hair. However, the current concept of women's beauty is relatively diverse and complex. Today, they have opened their mindset with whole body care, not only a particular part. They increase demand on skin care, especially the facial skin. Because of the influence from the old habit and the application of medical knowledge, the Vietnamese woman has formed a daily skin care routine. Wit...