best in france case study …an english company in france l u s h cosmetics research by: regina...

Best in France Case StudyBest in France Case Study

……an English an English company company in Francein France

L U S H Cosmetics

Research by:Regina CordovaMaria Isabel Le MeurGiusep Derleth

Best In France: LUSH Cosmetics Best In France: LUSH Cosmetics 22

Presentation OutlinePresentation Outline

1.1. Company overviewCompany overview History and locationHistory and location The LUSH BusinessThe LUSH Business LUSH PositioningLUSH Positioning

2.2. Presentation of Lush FrancePresentation of Lush France

3.3. ConclusionsConclusions


LUSH History and LUSH History and LocationLocation

HistoryHistory– 1978 : Supplier of The Body Shop1978 : Supplier of The Body Shop– 1994 : Creation of Lush in Poole (UK) 1994 : Creation of Lush in Poole (UK) – 2005 : Still a small team but increasing sales : 120 M 2005 : Still a small team but increasing sales : 120 M

poundspounds

A worldwide A worldwide companycompany410 shops in more than 40 countries :UK : 83 shopsJapan : 80 shopsCanada :

4 factories:UK, Japan, Italy, Canada

History LUSH in France Conclusions


The LUSH BusinessThe LUSH Business

Strong ValuesStrong Values– Handmade and fresh ingredientsHandmade and fresh ingredients– No test on animalsNo test on animals– No or simple packagingNo or simple packaging

Products: A complete range of cosmeticsProducts: A complete range of cosmetics– More than 600 different productsMore than 600 different products– Skincare, Hair care, Bath products …Skincare, Hair care, Bath products …

Customer relationshipCustomer relationship– Quality customer relations / Advice / CustomizationQuality customer relations / Advice / Customization



LUSH PositionningLUSH Positionning


Customer relationship

quality

EthicalValues

L’Occitane

Lush

Bodyshop

Garnier

L’Oréal Paris

Chanel

Fresh LineYves Rocher

Dior

GivenchyGuerlain

Vichy

EssentialsSabby’s

LUXURYRETAIL

NATURALCosmetics

HANDMADECosmetics


Presentation OverviewPresentation Overview

1.1. Company OverviewCompany Overview

2.2. Lush In FranceLush In France

Why France ? Why France ? Paris history and performanceParis history and performance Difficulties FacedDifficulties Faced Adaptations ImplementedAdaptations Implemented

3.3. ConclusionsConclusions


Why France ?Why France ?A strategic marketA strategic market

France reputation: « the spiritual home of France reputation: « the spiritual home of cosmetics »cosmetics »

Paris = second worldwide cosmetics marketParis = second worldwide cosmetics market Constant new products: 300 launches yearlyConstant new products: 300 launches yearly French French

Cosmetics MarketCosmetics Market

No direct competitor in France No direct competitor in France

A great opportunity for LushA great opportunity for Lush 2005 skin care sales in France: €3.3 billion2005 skin care sales in France: €3.3 billion 2010 forecast: €4.2 billion2010 forecast: €4.2 billion Retail Sales of Skin Care by SubsectorRetail Sales of Skin Care by Subsector**



France Cosmetic MarketFrance Cosmetic Market

Retail Sales and forecast of Skin Care by Subsector: Value 2000-2005

EUR million 2003 2004 2005 2006 2007 2008

Facial care 2,118.5 2,277.0 2,427.9 2,520.7 2,618.4 2,735.2

Body care 576.8 660.1 740.2 810.9 887.4 968.9

Hand care 87.5 93.7 98.3 100.8 103.4 106.2

Skin care 2,782.8 3,030.8 3,266.4 3,432.5 3,609.2 3,810.3Source: Trade associations (FIP, PLMA), trade press (Cosmétique Magazine, FaireSavoirFaire, LSA, Linéaires, Points de Vente), company research, store checks, trade interviews, Euromonitor International estimates

Cosmetics (US $ mln): France 2001 – 2011 Year France % of Region % of Globe

2003 654.22 11.52% 3.44%2004 667.52 11.57% 3.43%2005 683.92 11.60% 3.40%2006 717.82 11.57% 3.37%2007 756.32 11.53% 3.33%2008 796.87 11.49% 3.30%

Source: Philip M. Parker, INSEAD, copyright 2005, www.icongrouponline.coma moment when

http://www.icongrouponline.coma/

http://www.icongrouponline.coma/


Why France ?Why France ?The « natural » trendThe « natural » trend

Booming natural cosmetics market in FranceBooming natural cosmetics market in France– 40% increase from 2004 to 2005 (40% increase from 2004 to 2005 (Organic Monitor Study)Organic Monitor Study)– « The French market for natural cosmetics is the fastest growing in « The French market for natural cosmetics is the fastest growing in

Europe »Europe »

Increasing awareness of the dangers of cosmeticsIncreasing awareness of the dangers of cosmetics– March 2005, Television documentary : possible dangers of substances March 2005, Television documentary : possible dangers of substances

used in cosmeticsused in cosmetics– Best seller in France : « La vérité sur les cosmétiques » from Rita StiensBest seller in France : « La vérité sur les cosmétiques » from Rita Stiens

A comer marketA comer market – 23% of adults would pay more for environmentally-friendly products 23% of adults would pay more for environmentally-friendly products

and never buy toiletries and cosmetics tested on animals.and never buy toiletries and cosmetics tested on animals.



French StoresFrench Stores

History of Lush FranceHistory of Lush France– Creation in 2004Creation in 2004

– Only 2 shops :Only 2 shops : Paris (65th shop worldwide) = 6 800K € Paris (65th shop worldwide) = 6 800K € Lille = 450K €Lille = 450K €

Lack of a specific company strategyLack of a specific company strategy– No plan for the futureNo plan for the future– Little knowledge about the french marketLittle knowledge about the french market– No target clients, no marketingNo target clients, no marketing



GreatGreat PerformancePerformance

Simple Strategy ImplementedSimple Strategy Implemented– Educating the marketEducating the market

Free samples, word of mouth marketing, customers resturnedFree samples, word of mouth marketing, customers resturned

Established strong customer baseEstablished strong customer base– Strong Revenues (Paris = 6 800K euros)Strong Revenues (Paris = 6 800K euros)– Customer Customer satisfaction

Moisturizing Cream Buvard (Cream day/night)Moisturizing Cream Buvard (Cream day/night)– ““I (…) realized its effectiveness and I do not drop it any more, I'm sure I will I (…) realized its effectiveness and I do not drop it any more, I'm sure I will

buy it again!!”buy it again!!” Raz-de-maréeRaz-de-marée

– ““I like this rubbing-out very much because I really think it is efficient. (…) a I like this rubbing-out very much because I really think it is efficient. (…) a real effectiveness on my skin (…)”real effectiveness on my skin (…)”

French forum : « Lush addicts blog »French forum : « Lush addicts blog »



Difficulties faced Difficulties faced & relative costs& relative costs

DIFFICULTIESDIFFICULTIES COSTSCOSTSFinding the right location

Paris Store: 1.5 years Lille Store: “the right price at the right time”

Location search costs Delay costs

Customers’ specificities Paris Market: « exigent customers » Customers are well educated

Training costs

Legal constraints

Key money Seasonal employees Hiring process Franchise

Legal fees for hiring seasonnal employees Employee releasement costs Franchises legal fees Franchises delayed process opportunity costs

Cutural differences

Finding the right lawyer Search for a new lawyer cost


Adaptations implementedAdaptations implemented

Few adaptations has been made :Few adaptations has been made :

– No specific strategy has been implementedNo specific strategy has been implemented

– Stores and InternetStores and Internet 2 stores and a french website2 stores and a french website

– The products are very similar to the english ones:The products are very similar to the english ones: Same products for all storesSame products for all stores Few adaptations on names and packagingFew adaptations on names and packaging



Presentation OutlinePresentation Outline

1.1. Company OverviewCompany Overview

2.2. Lush in FranceLush in France

3.3. ConclusionsConclusions The LUSH FutureThe LUSH Future Advice from LUSH FranceAdvice from LUSH France


The LUSH Future The LUSH Future

Future Plans for LUSH in FranceFuture Plans for LUSH in France– Franchise ExpansionFranchise Expansion

« 30 to 40 new stores »« 30 to 40 new stores »

Risks identified for LUSHRisks identified for LUSH More and more competitorsMore and more competitors Increasing costsIncreasing costs Some products may be inadequate in the french marketSome products may be inadequate in the french market



Advice From LUSH FranceAdvice From LUSH France

Get information about the businessGet information about the business– Distribution networkDistribution network– MarketMarket

Flexiblility is keyFlexiblility is key

The need for strategy The need for strategy

- Have a set idea of where you are going- Have a set idea of where you are going



Thanks & bibliographyThanks & bibliography

Thanks to Emilie (Communication Director of Lush France)Thanks to Emilie (Communication Director of Lush France)

BibliographyBibliography– http://www.beaute-test.comhttp://www.beaute-test.com– http://www.lush.comhttp://www.lush.com– Data MonitorData Monitor– www.icongrouponline.comawww.icongrouponline.coma– Organic Monitor StudyOrganic Monitor Study– Euromonitor International Euromonitor International

best in france case study …an english company in france l u s h cosmetics research by: regina...

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