strategic marketing plan and audit - burts bees
TRANSCRIPT
Burt’s Bees ‘Leaving The Hive’
Seánpaul WalshKenneth KiernanMaeve Mc Quillan
Case StudyOriginal vision is to reach ‘’ Everyone, Everywhere ’’By expanding into the mass market will Burt’s Bees run the risk of becoming too commercial?How can Burt’s Bees grow the brand without distancing itself from the people and values that made it successful so far?
OverviewAnalysis
ExternalInternal
Key IssuesStrategic Alternative (A)Strategic Alternative(B)Chosen StrategyCase Lessons
Competitor Analysis
Category Product Range Audit
CategoryNPC
PenetrationNPCGrowth
CurrentOffering
CompetitorOffering
NPCFeasibility
Cosmetics 2.2% 18.8% No No NoFeminine Hygiene 2.2% 12.6% No No NoNail Care 2.6% 7.2% No No NoFragrances/Aromatherapy 4.3% 14.3% No No Yes
Shaving 5.3% 13.4%No (wasoffering)
No Yes
Oral Hygiene 9.9% 13.5%No (wasoffering)
Yes Yes
Deodorant 10.4% 18.3% No No No
Haircare/Colouring 11.5% 17.1% No YesYes(ready to
launch)Baby Care 13.3% 14.4% Yes Yes N/ABath 23.2% 14.0% Yes Yes N/ABath/Toilet Soap 23.6% 13.5% Yes Yes N/ASkin Care 27.4% 13.4% Yes Yes N/A
Usage by Brand
Brand Jul-05 Jun-06 % DifferenceDove 57 56 1% lossOlay 33 36 3 % increaseNeutrogena 29 32 3 % increaseHerbal Essence 27 25 2 % decreaseL’Oreal 28 32 4% increaseChapstick 40 50 10% increaseBlistex 35 30 5% increaseAveeno 14 19 5% increaseNivea 12 9 3% decreaseGarnier 10 18 8% increaseAveda 7 8 1% increaseBurt’s Bees 13 19 6% increaseTom’s of Maine 6 6 Stayed the sameAvalon 1 1 Stayed the sameAlba 1 0 1% decreaseNatures Gate 1 1 Stayed the sameAubrey 1 1 Stayed the sameJason 3 3 Stayed the sameDr. Hauska 1 0 1% decrease
Brand Awareness
DoveOlay
Neutro
gena
Herbel
Essen
ce
L'Orea
l
Chapsti
ckBlist
ex
Aveen
oNive
a
Garnier
Aveda
Burts Bee
s
Tom's O
f Main
e
Avalon
Alba
Nature'
Gate
AubreyJas
on
Dr. Hau
ska0%
20%
40%
60%
80%
100%
120%
Brand Awareness June 2006
Brand Awareness
Strategic Mapping
Distribution Breakdown and Market Share
2002 2005 Growth ’02-05
Gift/Specialty Stores 39.9% 31.2% -8.7%
Health Stores 29.0% 15.2% -13.8%
Drug Stores 9.0% 29.3% 20.3%
Distributor 5.1% 12.8% 7.7%
Grocery 6.0% 6.9% 0.9%
Other 11.1% 4.7%` -6.4%% of Respondentswho consideredbrand natural
Annual Ad Spendas a % of revenue
2005 % MarketShare, NaturalGrocery
2005 % MarketShare, DrugStore Channel
Burt’s Bees 0 0 7.3 0.4
CBBE Pyramid
SWOT Analysis
Strengths• Effective Product• Customer Loyalty• Experienced Mgmt
Team• Organic
Weaknesses• Low Brand Awareness• Mixed Channels• Varied Image
Opportunities• Huge Growth Markets,
Low Penetration• Unique Competitive
Advantage
Threats• "Just Another Do-
Gooder"• Higher Price
Key Issues• Product Line
• Brand Strength
• Retailer Relationships
• Management Change
• Where Next
• New Competitive Environment
Strategic Alternative (A)Staying in the Niche Market
• Focus on natural personal care Niche Market
• Increasing Market Share to dominate the natural personal care Niche Market
• Continuing to use Gift stores, Health stores and Speciality stores as main distribution channels
Strategic Alternative (A) Implementation
• Improving Retailer Relationships– Continuing to Withhold Trade Terms
(E.g. No discounts from mass retailers)
• Spa Chain Partnerships– New, Specialised Distribution Channel– Professional Image and New Use for Burt’s Bees
Products– Spa Chain with similar core values (natural)
Strategic Alternative (A) +Advantages+
• Has worked in the past, and has led to the current success of Burt’s Bees
• Easy to implement, doesn’t require much change or expense
• Niche market retailers will fully utilize eye-catching “hive” merchandising
• By improving relations with niche retailers, recommendations and word-of-mouth will increase
Strategic Alternative (A)-Disadvantages-
• Limited potential for growth in niche market
• Limiting the potential for large-scale success
• Revenue is increasing in mass channels and decreasing in niche channels
Strategic Alternative (B)Joint Venture Into Mass Market
•Joint venture with Herbal Essence (pseudo natural, 97% brand awareness).
•“Smaller firms would seek alliances with bigger more powerful companies is because of the credibility boost, technology leveraging and access to a market which a larger player is likely to bring to the table” Sherman (2003)
•Another possible reason for joint ventures is to integrate product lines. Sherman (2003)
•Careful thought into choosing partnership
Strategic Alternative (B) What’s In It For Herbal Essence?
Pros+Expansion of the product portfolio
+Possibility of becoming a fully natural product line
+Acquiring a percentage of Burt’s Bees passionate and loyal customer base
+Dominant brand image on shampoo line
Cons-Complication of the product line which may cause brand confusion with the consumer
-Re-pricing strategy may need to be implemented if Herbal Essence are to go down the natural product route
-Herbal Essence already has high brand awareness why would it run the risk of compromising this
Strategic Alternative (B) What’s In It For Burt’s Bees?
Pros+Opportunity for shampoo line to reach the mass market
+Herbal Essence currently have a 97% brand awareness in the personal care market
+Increased capital and larger distribution channels available to Burt’s Bees
+Joint venture with a large player in the “pseudo natural”, at least its not a traditional personal care product company
Cons-Loosing the authenticity of their brand resulting in disillusioned customers
-They have just come up with their own natural shampoo range, do they want to jeopardise that?
-Herbal Essence bring limited knowledge to the joint venture e.g. hair care
Strategic Alternative (B) Overview
• The benefits of the strategy for Herbal Essence greatly out weigh the benefits for Burt’s Bees
• Burt’s Bees will be forced to give up a certain amount of control (Sherman, 2003)
• The risk of becoming too commercial
• Possibility of too much brand confusion, other strategies may need to be looked at
Chosen Strategy:Rebranding-Strengthen-Enter Mass
Market
Rebranding
Rebrand1.Niche Market
Campaign Build Up2. Selected Mass
Market3. Entry4.
Why Rebrand?
• Image Problems• Growth is possible without compromising• Use that loyal customer base more effectively• Sustain value whilst creating new value• Retaining core values of the product but
simply architecting a structured brand and product portfolio
Strategy Implementation I
1. Rebrand• New Logo
– Brand Personality
• New Value Proposition– Healer
• Differentiation• Increase Ad Spend
– TV, Online, Communities
• 6 Months
“embodiment of personality traits of the consumer in the brand itself”
(West, Ford & Ibrahim, 2006; P259).
Umbrella Brand
.
Hair care Skincare Men’s Baby Outdoor Body Face Care
Strategy Implementation II
2. Build Up Campaign• Niche Market Build• New Advertising• New Unified Packaging• Promotion
– Sample Days – Coupons– Television – burtsbees.com– Social Media
• Use Customers
Strategy Implementation III
3. Selection• Re-assess Consumer Awareness• Select Categories:
– Hair care, Nail Care, Shaving, Skin Care and Fragrances
– High Growth Rate, Low Penetration
• Select Channels:– Drug stores, Distributors and
Grocery– Most Profitable Revenue
Increase– Try keep Gift Stores but it will be
hard
Strategy Implementation IV
4. Entry & Future• Enter Selected Markets &
Compete• Monitor Performance• Don’t over-do it all at once• Gradual Long Term• Key is to sustain value• Future:
– Honey & Lemon Drinks– Certified Stamps
Will it Work?
Our chosen strategy is achievable and realistic because of recent consumer demand trends for organic natural products and because we are not compromising the core values of the product but simply architecting a structured
brand and product portfolio whilst sustaining and growing existing customer value
Case Lessons• A clear consistent Image is key• Business is about making a decision and implementing it, there
will always be consequences but it’s about weighing them up• Change can happen without compromising your values
“An idealist believes the short run doesn’t count. A cynic believes the long run doesn’t matter. A realist believes that what is done or left
undone in the short run determines the long run”
Sydney J. Harris (1917-1986), American Journalist.
“All growth is a leap in the dark, a spontaneous
unpremeditated act without the benefit of experience.”
Henry Miller (1891 - 1980),US Author.
Thank You For Listening