Answer of 2

Culture is one of the most important factors that influence on the consumer behavior and
marketing environment. Business organization concerns deeply on the culture while researching
the target market of a country.

Country profile

Name of the country South Korea

Capital Seoul
Population 50,924,172 (as of 2016)
Population growth 0.53%
GDP (official exchange rate) $1.377 trillion (2015 est.)
GDP (purchasing power parity) $1.849 trillion (2015 est.)
GDP growth 2.6% (2015 est.)
GDP (per capita) $36,500 (2015 est.)

Unique characteristic of South Korea

K-beauty holds a very significant characteristic of South Korean culture (Teng, 2015). South
Korean culture is too much looks oriented. Most Koreans are giving their first attention to
external looks and skincare issues. As a result, both men and women are spending huge amount
to purchase cosmetics. South Korean women spend in beauty products twice of their income and
men spend more on skincare compared to other countries (BBC, 2016).

South Korean job market is so competitive so that wearing makeup is an important issue in the
game. Koreans are trying to show good facial impression in the job interviews by hiding their
original looks. South Korean men are spending $900 million in purchasing cosmetics a year that
makes the country most growing men cosmetics market (Fujjita, 2013).

Product
BB cream takes the special attention in the cosmetics industry of South Korea. Cosmetics
manufacturing companies of South Korea are innovating new types of BB cream for men and
women with a different skin.

Image: BB cream

Features of BB cream

BB creams are having the following features:

Offer different skin BB cream for men like as dry, oily skin and normal.
Light and easy-to-apply texture at any time at any place.
BB creams emphasize on conditioning skin that South Korean men and women prefer.

Price

Price is the amount at which a certain product or service is exchanged (Conkling, 2011). In other
words, price denotes the money value of a product or service. It reflects the worth of a product or
service and the amount of money for which it can be exchanged. Price is an important determiner
in the marketing mix. South Korea is very much price and quality sensitive (Teng, 2015). South
Korean people pay attention to low priced product. As a result, they purchase low price Korean
products instead of high price France or US brands.

Considering these factors the price of BB cream will set the penetration pricing strategy. It refers
setting prices low to attract new customers and win in the price wars to lead over competitors
(Hurd, Barcelona and Meldrum, 2008). South Korean beauty industry is very much competitive
so that penetration pricing strategy appropriate for BB cream product.

Promotions

Promotion is the marketing communication package used to make the offer known to potential
customers and persuade them to investigate it further (Blythe, 2009). For BB cream the
following promotion strategies will apply:

Social media campaign

Celebrity shows
Advertisement on TV, billboard
Face-to-face
Promotional gifts
Advertisement on the internet

Place

It refers the location where the exchange takes place (Blythe, 2009). South Korean people are
tech-savvy so that online shopping is very popular in the country. BB cream will be sold in retail
stores, face-to-face sales, and online shopping stores.

Answer of 3

Cellnique is Malaysian based cosmetics manufacturing company established in 2000. The

company is manufacturing and selling varieties of beauty products for men and women. The
company has the aim to expand its business throughout the world. To do so, the company first
requires conducting Ansoff matrix. This matrix Cellnique clarifies thinking about the dimensions
of the market and the brand position to help develop an appropriate strategy (Pringle, 2008).
 Figure: Ansoff Matrix

Ansoff matrix supports Cellnique determine its beauty products and probable market growth
strategy. Through this matrix analysis, Cellnique can understand whether the company should
expand with current products in new or existing markets or the company should expand with
new products in new or existing markets.

This Ansoff matrix suggests four growth strategies from which Cellnique can select best suitable
growth strategies for its products.

Market penetration: In this strategy, a company is focusing on current product for existing
markets (McDonald and Meldrum, 2007). The objectives of this strategy are increasing or retain
the current market share of existing products, ensure market domination and drive out the
competitors. Market penetration is very commonly used growth strategy used almost every
company because globalization eases firms entrance into the market. Companies use this
strategy where competition is very high, existence of substitute products, defeat competitors, and
create brand image into the customers mind.

Market development: Here, a company is looking forward to selling its current products into
new markets. The objectives of the strategy are introducing products into new geographical
markets, apply new pricing policies, and implement new distribution channels. Market
development is comparatively risky strategy compared to market penetration because it requires
market research of the new markets and it is unknown about customers response to the products.
Product development: In this strategy, a company focuses on developing new products for
current markets (Hiriyappan, 2013). This strategy is challenging for a company because it
requires achieving new competencies and modified products which create unique appeal to the
customers of existing markets. The company needs investing money in research and
development of products but the return of investment is good. Company can quickly place in the
top position.

Diversification: In this strategy, a company expands its business into new markets with new
products. This strategy is very risky and cost oriented. How the customers of new markets react
towards the new products is completely unknown or little known to the company. Diversification
strategy is merely adopted by companies. Initially, companies are not invested more to
implement the strategy.

Suitable strategy for Cellnique

After discussing the Ansoff matrix, the most appropriate business growth strategy for Cellnique
is market development. There are several reasons behind this selection:

Cellnique has a good brand name in South East Asia

The company is currently producing skincare products for men and women.
The company has capability keeps the price comparatively low than other European, East
Asian and American competitors.
The body massage service is growing popularity in Latin America, Europe, North
America and South East Asia. So, there has very good opportunity fo market
development by Cellnique.

Answer of 5

Departmental store Supermarket

A departmental store is a large store Supermarket is a self-service shop
selling, under one roof but in that offers people to purchase a
Amount of service physically separate departments wide range of different foods and
(Cox, 2006). household products.
 Departmental stores offer four or Customers can select their
more various types of consumer necessary foods in a shopping
goods. cart, bring to the payment counter
A departmental store is full-service and pay for each item.
retailer. Supermarket is not only offering
Each department carrying out its tinned goods and processed or
own buying, merchandising and semi-processed foods but also
stock control. fresh meat, fresh fruit, and fresh
vegetables.
Departmental stores set different Supermarket generally operates
price considering different market discount stores. This supermarket
segment. After increasing the keeps their products price
competition, most of the comparatively low compared to
departmental stores are turned into the typical market value.
discount stores. Though The competition in the
departmental stores use discount supermarket retail business is
price, there are different price very high. So that supermarket
Relative prices segment for different products. stores are keeping their products
Some departmental stores are high price at discount rate.
fashion specialty store (e.g. Aldi, Wal-mart Tesco etc. are
Nordstrom, Barneys etc.) offering operating discount stores globally.
upscale and exclusive products, Supermarket offers relatively low
some are mid-level (e.g. Dillards, price to the customers to pick
Boscovs etc.) offering moderately more customers and stay in the
priced products and some are price competition.
sensitive (e.g. Target, JC Penny
etc.) offering discount price
products (Petro, 2013).
The product lines of departmental Supermarkets are generally
stores are wide. Except for grocery involved with selling a wide
items, all sorts of products are variety of grocery items, foods,
 founded in departmental stores. The and households products into
product lines cover clothing, aisles. The product lines of
Product lines housewares, furniture, toiletries, supermarket typically comprise
home appliances, books, jewelry, baked goods, dairy foods, fresh
toys, cosmetics, baby products, vegetables, fruits, meat, fish,
sporting goods, electronics, and canned and packaged goods and
products for pets, stationery and household products such as
photographic equipment. kitchenware, pharmacy/medicine
goods, household cleaners,
festival items etc.

References

BBC (2016) The key ingredients of South Koreas skincare success. [Online]. Available at:
http://www.bbc.com/news/business-35408764 (Accessed: 9 July 2017).

Blythe, J. (2009) Key Concept in Marketing. London: SAGE

Conkling, R. (2011) Energy Pricing-Economics and Principles. Oregon: Springer Science and
Business Media.

Cox, R. (2006) Retailing-An Introduction. 5th Edition. New Delhi: Pearson Education India.

Fujjita, A. (2013) South Korean men cosmetics-crazed. [Online]. Available at:

http://abcnews.go.com/blogs/lifestyle/2013/05/south-korean-men-cosmetics-crazed/ (Accessed: 9
July 2017).

Hiriyappa, B. (2013) Strategic Management and Business Policy. Bloomington: Booktango

Hurd, A., Barcelona, R. and Meldrum, J. (2008) Leisure Services Management. Leeds: Human
Kinetics Inc.

McDonald, M. and Meldrum, M. (2007) Marketing in Nutshell. Burlington: Butterworth-

Heinemann.

Petro, G. (2013) Department store pricing-no easy task. [Online]. Available at:
https://www.forbes.com/sites/gregpetro/2013/01/10/department-store-pricing-no-easy-task-part-
4-of-4/#7b9c935d103a (Accessed: 10 July 2017).

Pringle, H. (2008) Brand Immortality. Philadelphia: Kogan Page Publishers.

Teng, A. (2015) The invasion of Korean culture. [Online]. Available at:

https://tengzeming.wordpress.com/category/cosmetics/ (Accessed: 9 July 2017).