Cosmetics Giants Segment the Global Cosmetics Market

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1. How do women’s preferences for cosmetics and beauty care vary from country to country?

Women preferences for cosmetics and beauty care worldwide can be classified in four categories:

• Demographic – Purchasing Power: Chinese women are price sensitive, so spending on premium brands sometimes represents a status symbol. Rather more, Chinese women believe that pale skin brings wealth; hence, whitening creams are very popular there. Also, Brazil is the third largest market for cosmetics, since women spend a lot on beauty products as compared to any other part in the world. A variety of hair care products are in demand along with a high emphasis on physical attributes.
• Psychographic – Culture: In India, most of the population live on only $2 per day. Nowadays, the number of working women has increasing dramatically. Thus, these millions of women, starting from 20 years old, are worried about grey hair. In addition as we saw in Bollywood movies, Indian women with eyeliner, henna-stained hands and feet, and long, shiny hair has defined beauty for centuries.
• Ethnic – Religion: Women in Saudi Arabia cover up most of their faces except for their eyes. Therefore, eyes makeup is a necessity to these women (Dark kohl, mascara, eye shadow).
• Benefit – Climate: Russia is known for its cold temperatures in winter. Darker skin or tanned women are very unique there and are associated with health and wealth. Therefore, solariums and bronzers are highly demanded there. On the other hand, in Japan it is very hot and humid there. Thus, women prefer skin whitening products and compact foundations instead of the liquid ones for a longer and lasting coverage. (Curtin University 2014).

1. Assess Estee Lauder’s strategy for China, Does it make sense to focus on premium brands, or should the company launch a mass-market brand?

Estée Lauder is viewed as aspirational and future oriented. It focuses on luxury and prestige brands but at affordable prices such as Estee Lauser, Clinique, and MAC that are sold through upmarket department stores. One analysis critique was that Estee Lauder targeting and positioning may be too narrow for China. However, Estée Lauder has done market researches and found out that the demand for luxury cosmetics is growing rapidly in the whole of China not only in tier-one cities. Therefore, Estee Lauder is targeting new cities such as tier-two and tier-three cities. In addition, Chinese consumers are price sensitive but they are willing to invest in products that are relatively expensive because they are confident about the future. And Estee Lauder isn’t only providing high quality products, but also fulfils customer’s emotional satisfaction and socio-economic status. In conclusion, Estée Lauder should focus on premium brands, since the Chinese are changing their behaviour and their economy is growing rapidly. (Keegan and Green 2015, p.252).