Burt’s Bees Lip Balm: Targeting and Segmentation
1. List the broad product market:
Lip care products
2. What homogenous products can be found in the broad product market? Lip balm, lip gloss, lipstick, petroleum jelly, lipstain, lip plumper
3. Name the homogenous product market:
Lip Balm
4. Market description:
Industry Statistics: • Skin care industry sales in 2007 for the US were 8059.2 million, with a growth rate of 3.1 percent from 2006.
• The skin care industry has had a compounded annual growth rate of 3.6% from 2002-2007.
• 88% of cosmetic products are sold through store-based retailing and 27.9% are sold in supermarkets.
• 75.8% of skin care products are sold though store-based retailing and 15.2% are sold in supermarkets.
• The skin care industry has a projected Compound Annual Growth Rate of .1% per year for 2007-2012, while the men’s care sector of the cosmetic industry has a projected CAGR of 1.8% for 2007-2012.
Industry Trends:
Consumers are more concerned with the environment and their health, thus looking towards natural and organic cosmetic products for their personal use. Consumers are becoming more cautious about the chemicals, synthetic preservatives, and fragrances that are used in some cosmetic products. This consumer trend has led to strong profit growth for companies that produce natural cosmetics. In order to keep up with the desires of this emerging customer base, even large national companies are expanding into the natural product market. L’Oréal and Estée Lauder have launched lines of natural products. In 2007, Clorex purchased Burt’s Bees for $925 million.
Driven by growing consumer demand, retail sales of natural and organic beauty care are likely to continue growing. In fact, industry representatives anticipate double-digit growth in natural beauty care in the United States, a figure that is far ahead of growth projections for standard cosmetics and toiletries.
Drugstores have become the second leading distribution chain for the cosmetics industry.
Lip care products
2. What homogenous products can be found in the broad product market? Lip balm, lip gloss, lipstick, petroleum jelly, lipstain, lip plumper
3. Name the homogenous product market:
Lip Balm
4. Market description:
Industry Statistics: • Skin care industry sales in 2007 for the US were 8059.2 million, with a growth rate of 3.1 percent from 2006.
• The skin care industry has had a compounded annual growth rate of 3.6% from 2002-2007.
• 88% of cosmetic products are sold through store-based retailing and 27.9% are sold in supermarkets.
• 75.8% of skin care products are sold though store-based retailing and 15.2% are sold in supermarkets.
• The skin care industry has a projected Compound Annual Growth Rate of .1% per year for 2007-2012, while the men’s care sector of the cosmetic industry has a projected CAGR of 1.8% for 2007-2012.
Industry Trends:
Consumers are more concerned with the environment and their health, thus looking towards natural and organic cosmetic products for their personal use. Consumers are becoming more cautious about the chemicals, synthetic preservatives, and fragrances that are used in some cosmetic products. This consumer trend has led to strong profit growth for companies that produce natural cosmetics. In order to keep up with the desires of this emerging customer base, even large national companies are expanding into the natural product market. L’Oréal and Estée Lauder have launched lines of natural products. In 2007, Clorex purchased Burt’s Bees for $925 million.
Driven by growing consumer demand, retail sales of natural and organic beauty care are likely to continue growing. In fact, industry representatives anticipate double-digit growth in natural beauty care in the United States, a figure that is far ahead of growth projections for standard cosmetics and toiletries.
Drugstores have become the second leading distribution chain for the cosmetics industry.