Presented by – Group 2 Jasveen Kaur (14) Neha Shaw (29) Prath Pr athamesh amesh Nar Narkar( kar(37) 37) Shal Sh alvi vi Sh Shar aran an (4 (48) 8) Shuaib Raza Sheikh(54)
QUICK FACTS Founded in 1969 by Antonio Seabra 2004: went Public 2009: 1.2 Million direct sales consultants Market: Latin America & France Market share: 21% Brazil, 8.6% Global Growth B Corp Certified Most Sustainable Companies in the World 2017 : Forbes
Unique fragrances combining the wealth of the Brazilian forest with essential oils and the tradition of its communities
Altogether 223 perfumes in fragrance base. Produced using organic alcohol from sugarcane
Market leaders in Brazil with market share of 21% in 2016.
EKOS – For women 5 fragrances (eau de toilette) Price range – 38-40 €
KAIAK – For men 4 fragrances (eau de cologne & eau de toilette) Price – 40 €
Country to Enter?
Hong K ong 11th
worldwide in terms of GDP/Capita Market size :HKD1.5 billion in 2016 11th worldwide in terms of most visited countries Foreign brands are major player compared to local brands No custom tariff on goods imported to Hong Kong. Premium fragrances are forecasted 7.5% value growth from 2016 to 2021. Hong Kong & Brazilian customers have similarity for fragrances in terms of quantity and quality. Natura produces oriental fragrances more which is likable by customers in Hong Kong.
Porter’s 5 forces (1/2) • Bargaining power of Supplier (Low) •
Competitive Analysis- L’Occitane and Kiehl’s Distribution
30 retail stores of L’Occitane in Hong Kong 23 retail stores of Kiehl’s
Oriental fragrance, premium product in affordable price range, online presence
Price L’Occitane starting from 485 HKD (100ml) Kiehl’s starting from 365 HKD(50 ml)
Market share L’Occitane leading brand in 2016 with 4% market share, Kiehl’s market share - 1%
Age group: 30-49
Customers: Who prefer natural product and care about sustainability
Experience: Belief that perfume you wear is more than just a scent, it’s a way to communicate
Global shoppers: They shop everywhere; where they live, while they are travelling and at their final destination
Pricing Strategy Beta testing : Free samples
Share established Price adjusted upwards to maximise profit
Pricing: 500 HK$ for 100 ml bottle
Trial and switching Penetration Pricing Market: Fast growing Share: low
How Natura distributes
Direct Selling (Offline) - Natura uses a network of consultants for dire selling in Brazil, Columbia, Chile and Mexico - There are about 500000 consultants internationally - We have employed this method since 1974 Direct Selling (Online) - Natura also has its own website which sells it products - This channel is available in all countries in which Natura is present - We normally ship through UPS Retail shops - Natura is trying to diversify its distribution channels - We have opened a store in France and a conce store in Brazil -A synergetic effect is expected to take place between these two channels as customers are striving for convenience and this will enable the reach products through different means.
Distribution Strategy in Hong Kong
- During the initial launch
period we will set up our own retail / experience shops in the 3 biggest malls in HK - We will also use the existing distributors of Body Shop - These stores will be similar to the stores in Brazil and France
-We will increase the number of retail outlets - Along with this we will design a site for HK which will also be an online sales platform, as the cost of leasing retail outlets is very high in HK
- We won’t employ the offline direct sales in HK - HK is a tourist destination , mainly tourists from mainland China come to visit - They want to experience the brand as 60-70% of buyers buy perfumes for the purpose of gifting.