1.1 Introduction
KIKO Milano was established and founded in 1998 by Percassi, as it is an Italian professional cosmetics brand in which features a range of cutting-edge makeup, as well as face and body treatments (KIKO Milano was both established and founded in 1998 by Percassi, it is an Italian cosmetics brand which provides a variety of advanced cosmetic products, appearance as well as body products). Where this consists of safe and effective products of the highest quality, which are created to satisfy the beauty requirements of women whom are of any age. KIKO’S identity root is “Made in Italy” values of which are related to the world of the capital for fashion, art and design. The research into original textures and colours combined with research into quality formulas with guaranteed performance, for a perfect fusion of quality and creativity. The result of this cutting-edge scientific discoveries and the latest fashion trends, KIKO continuously provides itself and to their customers with products that are always new and closer to the multiple ideals of beauty. KIKO’s aim is to provide customers with professional luxury for every budget therefore making it affordable for many people.
KIKO Milano is a new brand to the whole makeup scene, mainly to the United Kingdom. Over the past couple of years, the brand has expanded to having over six thousand stores that exclusively sell their products. Unlike other brands such as Too Faced, NARS, Tarte, KIKO don’t put their products into stores such as Sephora or House of Fraser for them to sell their products, all of their products are either sold online, or on their website, or in a KIKO store, which helps build the brand as all the stores are of the same style (worldwide) creating an identifiable store, and all of the employees are employed by the brand itself, meaning that they have a high knowledge and understanding of the brand and the makeup in which they are selling would provide the customer with trust in the brand.
KIKO Milano and their marketing mix, all company’s use the marketing mix to establish how they will market their product, as well as the fact that the marketing mix can consist of seven variables. Product can be defined as an idea, service or good which can be tangible and intangible attributes. To package their products, KIKO stay simple with black packaging with the company logo on the front, this packaging doesn’t attract the eyes of the customer or look the most appealing but it simply lets the product speak for themselves.
Price is the only component of the marketing mix that produces cash, all of the other variables are costs but the price is just a benchmark against the value of a product. For a company to establish a price for their product they must consider whether to use competitor based pricing which lets due to competitor’s prices, price comparison is crucial with this method, or demand based pricing which is when the price is decided on demand, meaning high price or high demand. Some of their cheap eye shadow pot of just £5 in comparison to MAC’s eyeshadow pots being £13, KIKO are more accessible for many people of all different classes.
The place variable tends to be the area that the products are distributed in and how the product is transported and stored, this variable includes making products available even in multiple channels in the quantities desired to as wide a range of customers as possible. Promotion can be defined as the business communicating with the customers which provides information that helps the customer when making a decision whether to purchase the product. To promote and advertise their organisation, KIKO mainly uses social media such as Facebook and Instagram, always with the use of their hashtags #KIKOMilano to identify their products, their images mainly consist of the products themselves or reposts of customer’s pictures with the products they have purchased. KIKO also uses YouTube to bring out promotional videos, their most recent one that they have produced is a video for their Christmas collection, which is under a minute long and it is based around the festive time of year. The products within this video are only shown in glimpse seconds which then entices you to either go in store or online to further check out their products.
People is mainly based on the target market of the product and those directly related to the business. Those who are involved in the business are the employees as these people are directly linked to the current product or service, usually the service for the people variable, it is crucial for the business to employ the correct staff as they are providing the service and representing the company.
Process has many different branches to it and tends to differ from company to company but the basis is an element of the service that sees the customer experiencing organisation’s offering, to put it simply can be what enables the transactions from the company to the customers.
2.0 Micro/Macro Environments
The micro environment of the organisation consists of those elements are controllable by the management. Most important factors of micro environment of a business are as follows; competitors, customers, suppliers, public, marketing intermediaries, workers and their union.
Normally, the micro environment does not affect all the companies in an industry in the same way, because the size, capacity, capability and strategies are different. For example, the raw material suppliers are giving more concessions to large sized companies. However, they may not give the same concessions to small companies. Like the same, the competitors do not mind about the rival company if it is compared to the small, but they will be very much conscious if the rival is large. Sometimes the micro environment of the various firms may differ as each firm will attempt to achieve a higher success level. The competitive environment consists of certain basic things which every firm has to take note of. No company, howsoever large it may be, enjoys monopoly. In the original business world, a company encounters various forms of competition.
The purpose of a SWOT analysis is to get managers thinking about everything that could potentially impact the success of a new organisation, failure to consider a key strength, weakness, threat or opportunity could lead to poor business decisions.
KIKO Milano has a variety of strengths within their organisation, first being them having a wide range of products to offer to their consumers. The organisation has a great experience in the sector as well as the fact that both their computer scientists and their product designers have a high creative quality. They also have one-to-one responses in which they pay individual and personal attention to the client, to make them feel as though they are included within the organisation. KIKO has a strategy in which they are based on offering the most competitive market prices and higher quality of service to their customers, where they also have their own sales web. All of KIKO’s high quality products are at affordable prices which attracts many customers due to the fact of the affordable price, suiting both those who wasn’t to experiment on a budget and those who are much more experienced makeup users who do require a large variety of colour. KIKO is an internally popular brand name, with over five hundred stores across Europe and twenty five within the United States. KIKO’s price range by a product does vary, face products between £2.20 and £15.90, lips between £1.20 and £8.90, eyes between £1.20 and £15.90, and nails between £0.50 and £8.90. KIKO has a wide product range and it is vast with over one thousand products to choose from in which are constantly expanding. Even though they have a wide product range, their individual products do also vary; for example, their inclusive foundation product is available in twenty one different shades, allowing KIKO to cater to consumers a wide range of diverse origins and ethnicities. Their Clic Palette system is innovative in how they are allowing their customers to personalise their palettes to suit their desires, as the majority of already made palettes, some of the colours aren’t even used. KIKO Milano is an Italian brand, with a respected Made in Italy reputation which is synonymous with the generalised public view of luxury, high quality goods. Regardless of the price KIKO is well known for their quality that rivals that of their high-end competitors.
KIKO has a variety of weaknesses, as it is a brand with great expansion in Europe but unknown in Australia, as they need to create a lot of brand awareness.There is not a lot of advertising or use of reaching out to bloggers, celebrities, features in magazines or other publications. KIKO may not initially be as well known amongst Irish consumers, particularly with older customers who do not spend as much time comparing brands online. However, the company could do more to promote their range of anti-ageing products and should also consider their strong male base of consumers, as times are changing so are the habits of the male population as it is not such ‘faux-pas’ to discuss a skin care regime and accepting the fact that some men do actually wear makeup. Currently KIKO does not offer a specific discount for professional makeup artists or students. There is also no opportunity for customers to have their orders delivered to a KIKO store, which is usually preferable for consumers who wish to avoid the home shipping costs.
KIKO has a variety of opportunities for their organisation, their sector is in full expansion and growth opportunity, and products low cost without sacrificing quality, design and innovation, also they can start magazine campaigns, or adverts, celebrity collaborations and it is quite clear to see that even though KIKO has not yet been introduced into the Irish market, over 60% have heard of the brand. The KIKO brand would be fresh and exciting for Irish consumers and within the Irish beauty blogger community. KIKO currently runs the #kikotrendsetters social media campaign which should be familiar with Irish consumers.
They have a variety of threats, which are brands like MAC, Revlon, Maybelline are well established in the market. The high street makeup brands are becoming an independent store in the same way as KIKO. The cosmetics industry is highly competitive and there is already much competition in terms of cosmetics retailers. Consumers may be more likely to stick with their trusted, more familiar brands initially. KIKO’s low prices could be associated with low quality to consumers who are not familiar with the brand. The cosmetics industry is full of rapid changes in market trends and consumer preferences, all of which could differ throughout international markets.
3.0 Market Research
Marketing
4.0 Market Segmentation/Targeting
Segmenting the market in KIKO Milano, it is fair to say that ninety nine percent are female (sixty five being professional + twenty percent being non professional + ten percent student + four percent being retired), as well as one percent of the population of the market being male. The majority of KIKO’S customers are from the medium class and their ages vary between the age of sixteen and mid forties. Effective market segmentation research provides our company with clear direction on which group or groups represent the best target that will account for a high share of potential profits for the company and can easily be identified in the population or consumer databases. If our market segmentation meets those requirements, then it will become a quickly discard waste of resources. KIKO has a variety of competitors, one of their main competitors are Mac Cosmetics, followed by BECCA Cosmetics, NARS, Revlon and finally Maybelline.
KIKO has ongoing training going on for their employees which does offer a way to make sure that all of their skills that are needed in the work place are used and that they are constantly improving in multiple different areas. This process offers opportunities to trust their employees within the organisation on various feedback processes such as recent product line changes or even upcoming possible improvements. An example of this being their latest lipstick range, and it having a special ingredient that makes it much more moisturising and longer lasting than other similar competitor products, for the sales staff to be aware of the product change as well as also obtaining an understanding of the benefits.