Marketing Plan for for Herborist Cosmetic Company, China

contents i administrator summary3 ii vexationen of map/ Figure4 1. 0 Situation synopsis5 1. 1 Company and w atomic number 18s background5 1. 1. 1 Company presentation5 1. 1. 2 increases introduction5 1. 2 constancy introduction6 1. 2. 1 securities industry size and distri yete6 1. 2. 2 Developing fronts7 1. 3 Macro-surroundal compgoalium8 1. 3. 1 Political and legal surroundings8 1. 3. 2 economic environment9 1. 3. 3 Sociocultural environment9 1. 3. 4 Technological environment10 1. 4 Competitive analytic thinking10 1. 5 guest analysis11 1. 6 scattering im hand over analysis11 2. 0 hit the books analysis12 2. 1 Strengths12 2. 1. 1 Good innate nonfunctionals de acquaintment cleave a line12 2. 1. make grocerying military capability13 2. 1. 3 Strong provoke company13 2. 2 failing13 2. 2. 1 Capital non secure as many planetary augmentative companies13 2. 2. 2 want of discolouration awargonness14 2. 2. 3 Huge room of modifyment in operations precaut ion14 2. 3 Opportunity14 2. 3. 1 Potential drug addiction subject matter14 2. 3. 2 2008 exceptional Games attract westerly to conventional Chinese elements (Chinese tether)15 2. 4 Threat15 2. 4. 1 Tough competition15 2. 4. 216 2. 4. 3 Investment adventure (ROI and cash consort)16 2. 4. 4 economical crisis17 3. 0 Objectives17 3. 1 somatic objective17 3. 2 merchandising objectives17 4. 0 tradeing schema18 4. 1 site grocery store18 4. billet schema18 4. 3 commercialize m altogether(prenominal)ing liquify19 4. 3. 1 point of intersection dodge19 4. 3. 2 Pricing strategy21 4. 3. 3 procession strategy22 4. 3. 4 Place strategy24 5. 0 calculate for the next three twelvemonths27 6. 0 intercommunicate pro conk and bolshy financial financial statement28 7. 0 Action plan29 8. 0 bid &038 feedback29 8. 1 deals analysis29 8. 2 Market conduct analysis30 8. 3 Profitability by production30 8. 4 Efficiency on advertising, bar net incomes progress analysis30 8. 5 Sales -force efficiency31 9. 0 Reference32 i Executive summary The marting plan is aimed to limn a systematic food selling strategy for Herborist Cosmetic Company, which is specialized in herbal tea tea tea tea enhancives.This marting plan testament firstly carry proscribed a cont closed take in analysis on the grocery store induct manage, size, plenteous-grown environment, statistical dispersion be eat, competitor, client and SWOT analysis for Herborist in Chinese augmentative grocery store. And then, found on the analysis, it bequeath state the incorporate and merchandise objectives of Herborist and then bear comme il faut marketing strategy recommendations for Herborist. On iodin hand the recommendations pull up stakes allow in the tantrum of market segmentation combined with targeting consumer statement as puff up as perspective strategy.On the other hand, the recommendations will besides include the suggestions on marketing mix practically(prenom inal)(prenominal) as the product strategies, equipment casualty strategies, distribution strategies and promotion strategies. ii List of graph/ Figure Figure 1 Market sh atomic number 18 and harvest-feast of varied decoratives sub-sectors, 20097 Figure 2 Skin disturbance bulls eyes sh atomic number 18 of do gross revenue, 2008-09.. 10 chart 1 selling budget chart for twelvemonth 2011 to 201327 graph 2 Projected profit and loss statement (2011 &8212 2013). 28 Chart 3 execution of instrument document29 1. Situation analysis 1. 1 Company and products background 1. 1. 1 Company introduction yarn-dye Herborist Co. , Ltd. tacked in 1998, as a subsidiary of the ahead(p) augmentative producer Shanghai Jahwa united Co. , Ltd, is independently operated (Herborist positive website 2010). As its undischarged focus on using endemic Chinese herbs in its earthy cup of tea- cathexis products, it has won population to a certain consummation in the domestic ornamental mark et of uncase boot aspect and was awarded with the call of Shanghai famed stigma in 2005(Herborist prescribed website 2010).And till the year 2008, Herborist has launched in European market through cooperation with Sephora, which is a leading enhancives sellers owned by Louis Vuitton Moet Hennessy mathematical group (Sephora decreed website 2010). 1. 1. 2 Products introduction The private electric charge products of Herborist personal ar rude(a) based on the concept of confederacy of two b ar-assedfangled bioengineering and conventional herbal medicine. to a lower place the emphasis of the balance among traditional Chinese medicine absolveding and the in utmost spirits-tech mean of modern technology, these products in Herborist give the axe strongly recuperate pelt, luggage com explodement and nub to achieve the original truelove and make the users flake as recently born (Herborist formalised website 2010). Herborists products focus on non alone the upkeep of face and body but overly the inside part, which always insist the concept of integrate handed-down Chinese Medicine into the modish fruits of modern biotechnology.Take its star product Thai Chi bumble for example, it institutes the last-for-ever Chinese artistic of balance via the compatibility of Yin and Yang. And at the uniform time, imput fitting to the opening of Herborist Spa since the year 2002, Herborist second the oil from herbal obtainping place and herbal water therapy to go game women with holistic c atomic number 18, which to a fault shows its concepts of balance beauty and health on the basis of Chinese traditional herbal medicine (Herborist functionary website 2010). 1. 2 Industry introduction 1. 2. Market size and ploughshare tally to the query from Li and Fung (2009), it shows that the cosmetics market of mainland chinaware has enjoyed a continuous growth over new age and mainland mainland chinaware has become the second pear-s hapedst cosmetics market in Asia nowadays. And mean man, Chinese consumers increasing acquire mightiness and to a greater extent than and to a greater extent than Chinese womens involvement in the workforce digest alter growth in the cosmetics market. Li and Fung (2009) a handle showed the data that retail value of chinas cosmetics has grown by 26. % and level(p) occured ? 48. 83 billion CNY in 2008 from the guinea pig Bureau of Statistics (NBS). Meanwhile, from Figure 1(Li &038 Fung 2009), we rouse enamour the skin concern products have interpreted up a uncollectible market share thus far to 26. 3% of Chinese cosmetic market. And meanwhile the major market share of skin care products equable dominated by slightly famous distant blots much(prenominal) as P&038G, Shieido, LOreal and many topical anesthetic low-end determine gulls much(prenominal) as Dabao and Longliqi(Li &038 Fung 2009).As the up-rising star of the cosmetic brand name, Herborists market share is about 0. 3% out of the summarize market share till the first quarter of the year 2010 (Herborist official website 2010). Figure 1 Market share and growth of assorted cosmetics sub-sectors, 2009 inauguration Access Asia 1. 2. 2 Developing trends On the basis of the survey from AMA communicating operate (2010), on that point is a trend of maturation health awareness among Chinese consumers payable to the nurture of chinas economy.Thats why Chinese consumers opt cosmetic products using natural ingredients than chemical products, especially the ones with strong attachment to Chinese Traditional Medicine (TCM), which is an native part of Chinese culture. Due to this special gustatory perception of Chinese consumers, in that respect is a trend that more than and more players, not unless domestic but also impertinent ones, begin to built in bed their cosmetic products with voiced chemical formulae as substantially as herbal and natural ingredients (Li &038 Fun g 2009).P, for deterrent example, added herbal ingredients such as Shouwu and Ginseng to its nourishing shampoos serial publication of Chinese market. Lux of Unilever also launched its shampoos series with the addition of Chinese herbal ingredients including Danggui, maiden sensory fuzz tree and Bai Hao Yinzhen in Chinese market. Under this trend, Herborist Co. , Ltd has launched series of natural beauty care products with the ingredients of herbs since the year of 1998, and now enjoys a darling prevalentity of temper beauty care brand (Herborist official website 2010). . 3 Macro-environmental analysis Macro-environment is the foreign factors including political, economic, sociocultural, expert and legal forces, which allure the survival of the face (Elliott, Rundle-Thiele &038 Waller 2010). 1. 3. 1 Political and legal environment In China, central regimen thus far encourages the domestic products growth, which is some sympathetic of see on for the growth of domestic cosmetic companies, such as Herborist Co. Ltd (Ting 2009). era, at the same time, with the executing of some tight regulations on cosmetic products such as the Hygiene banal for Cosmetics (2007 Edition) and the Hygiene Standard for Cosmetics Manufacturers (2007 edition), Chinese government and consumers pay more and more assist to the safety of cosmetic products, especially later on the Japan-based SK-II was tested and found to inhibit some unapproved substances in Chinese counter (Li &038 Fung 2009).For instance the constitutional number of prohibited and restricted substances employ in cosmetics is mellower at 1,286, and there is also strict limitation on the use of certain ingredients contained in preservatives, sunscreen promoter, coloring agent and hair dye agent. This also puts Herborist on bouncy to focus on their products safety. 1. 3. 2 Economic environment The economic conditions in China offer Herborist Co. , Ltd not but if opportunities but also risks. Ch ina is the second large cosmetic market in Asia and the total retail gross gross revenue of cosmetics in China is about ? 48. 3 billion CNY in 2008, which shows the great potential consumption division for cosmetic players both global and local, including Herborist(Li &038 Fung 2009). time the revenue upgradement rate for the skin care products in China is about 8% to 30% or so on and to comply with the World Trade ar browsement agreements, the import tariffs of cosmetic products has been gradually trim over the past few years, which pack great pressure for Herborist to face not only the expensive product tax but also the hyper competition from products of unusual players receivable to the relatively cheaper price compared to the anterior after the reduction of import tariffs. . 3. 3 Sociocultural environment There is a special penchant on natural ingredients specially the addition of herbal poppycock in skin care products, due(p) to the Chinese Traditional Medicine t herapy is the essence of Chinese culture (AMA Communication serve 2010). As for Herborist, this preference on natural ingredients skin care products of Chinese consumers is a great advantage. 1. 3. 4 Technological environment The growingd usage of the meshwork in China is the result from the training of technology, which results in the popularity of expansion the online platform for product sale for most cosmetic companies.Under this situation, Herborist has also hard-boiled up online platforms to show its products in request to realise more young customers (Herborist official website 2010). 1. 4 Competitive analysis As shown in figure 2 (Li &038 Fung 2009), the top of the inning 10 skin care brands accounted for closely 80% sales in 2009 of Chinese market, in which the foreign players take up a large share in the mid-high and high-end segments such as P&038G, LOreal and Shiseido. For Herborist these foreign brands including Olay, LOreal, Aupres, Yue-Sai, Avon, Shiseido a nd so on which also have the orientation on mid and mid-high segments are the superpowerful opponents.Figure 2 Skin care brands share of total sales, 2008-09 2009 2008 BrandCompany nameShare of total sales (%) OlayProcter &038 Gamble (Guangzhou) Ltd 29. 71 AupresShiseido Liyuan Cosmetics Co Ltd 18. 94 LOrealLOreal China11. 83 LancomeLOreal China7. 60 ShiseidoShiseido Liyuan Cosmetics Co Ltd 3. 47 Yue-SaiLOreal China2. 52 DeBonLG Household &038 Health Care Ltd 1. 32 TJOYNanjing Jianong Chemical Co. Ltd1. 11 Dabaocapital of Red China San Lu Factory0. 61 consortiumsUnilever China Ltd 0. 61 Others22. 29 BrandCompany nameShare of total sales (%) OlayProcter &038 Gamble (Guangzhou) Ltd 34. 0 AupresShiseido Liyuan Cosmetics Co Ltd 13. 91 LOrealLOreal China8. 36 DabaoBeijing San Lu Factory 5. 74 LongliqiJiangsu Longliqi congregation Co Ltd 3. 61 TJOYNanjing Jianong Chemical Co. Ltd 2. 58 Yue-SaiLOreal China2. 33 AvonAvon (China) Co Ltd 1. 36 MininurseLOreal China1. 08 PondsUnilever Chin a Ltd 1. 01 Others25. 82 1. 5 Customer analysis According to the research carried out by AMA Communication go (2010), the number monthly expenditure on beauty and skin care products of womanly uncontaminating call for consumers in Shanghai, Beijing reached 1,000 RMB (about cl USD).And in other inessential cities of China, there is also large consumption capacity on skin care products. According to the data from Herborist official website (2010), there are at least 270,000 consumers as its members and secretive 90,000 incumbrance member, who contributes nigh 45% consumption of Herborists products. Moreover, most of the core members of Herborist are the ones who switch from using international high-end skin care products to Herborists products and they have great brand loyalty to Herborist.Meanwhile these core members are also have great influence on motivating other consumers choosing Herborists products. 1. 6 Distribution transmit analysis There are several(a) distributio n impart for Herborist to deliver its products to domestic consumers such as opening counters in Chinas major plane section stores and passkey stores and stage setting up differentiation stores to give its products (Herborist official website 2010). For instance, Herborist has already opened nearly 450 specialty stores until 2008, 70% of them are franchises. 2. SWOT analysis For Herborist, to have a punter business performance, it is of import to be able to down the stairsstand the current opportunities in the market place, the major threat it may approach at the present as salutary as in the forthcoming, the strengths that Herborist owns compared with other competitors and the weakness which may affect its performance and future stand upment (Elliott, Rundle-Thiele &038 Waller 2010). The SWOT analysis for Herborist will be implemented in the following, which will indentify the internal strengths, weakness, the external opportunities and threats related to Herborist. . 1 Strengths 2. 1. 1 Good organic cosmetics brand envision Since the year of 1998, Herborist has begun to distinguish itself via intergrating Traditional Chinese Medicine into the latest fruits of modern biotechnology. And till now, it has already built a substantially jut out of organic cosmetics. The doctrine via Yin-Yang balance to enable skin, body and spirit to reach idea harmony and send natural, individualized and healthy beauty, has welcomed by a great many Chinese consumers(Herborist official website 2010). . 1. 2 Clear marketing position Herborist has posited itself as organic skin care brand and oriented itself targeted at centerfield and high income female albumin collar consumers, which attracts more than 270,000 consumers as its members and near 90,000 core members (Herborist official website 2010). 2. 1. 3 Strong rise company The parent company of Herborist is Shanghai Jahwa United Co. , Ltd, a leading Chinese domestic cosmetics producer, which is good at com bine R&038D, production, distribution and service.And meanwhile, Shanghai Jahwa has planed to enthrone ? 170 billion to grow the market share of Herborist, which fundament make haste the development and maturity of Herborist(Herborist official website 2010). 2. 2 Weakness 2. 2. 1 Capital not strong as many international cosmetic companies Although Herborist has the support from Shanghai Jahwa, the capital of it is all the same not strong as some international cosmetic companies, which limits its spending on research and development (Whiteman &038 Krug 2008). . 2. 2 Lack of brand awareness Although Herborist has gain a account of healthy and organic skin care brand, it still lack brand awareness among several Chinese consumers, due to the limited investment in advertising. For instance, Herborist only promotes its products in print publicizing while ignoring other channels such TV ads, radio ads and so on (Chinairn 2009). 2. 2. 3 Huge room of improvement in operations heed Operations management is another weak part for Herborist.It is account that poor logistics management has led to vast lead-time, high inventory as good as capital tie-up which place heavy burden on the future development of Herborist (Chinairn 2009). 2. 3 Opportunity 2. 3. 1 Potential consumption capacity In September 2006, the products of SK-II was tested and found to contain some unapproved substances in Chinese counter, followed by other being famous cosmetic brand including Clinique, Lancome, Dior and Estee Lauder whose cosmetic products were state to have prohibited substances (Ting, C. 2009).Due to these incidents, more and more Chinese consumers began to choose some organic and herbal skin care products, which is a great opportunity for Herborist to tack together. According to the bailiwick Bureau of Statistics (NBS), the consumption power on cosmetic products will reach at ? 60 billion CNY in 2010, in which skin care products will take up nearly 30% of the total number , which for Herborist is really good new disaster (Li &038 Fung 2009). 2. 3. 2 2008 Olympic Games attract western to traditional Chinese elements (Chinese wind) Because of the 2008 Olympic Games, all the attention was center on China which brought a Chinese wind.In skin care aspect, not only the Chinese consumers began to switch to choose herbal and organic products but also the foreign consumers show great interest in the skin care products with traditional Chinese medicine inside (AMA Communication Services 2010). As organic cosmetic brand specialized in herbal cosmetics, Herborist has develop to a lower place the concept of intergrating Traditional Chinese Medicine into the latest fruits of modern biotechnology, which do Herborist become one of the most popular domestic organic cosmetic brands in Chinese market under the Chinese wind(Simon 2009). 2. 4 Threat 2. . 1 Tough competition For Herborist, the largergest threat is the knotted competition mostly from international p layers. Chinese skin care market is some occupied by international cosmetics giants including LOreal, P&038G, Estee Lauder Shiseido and so on (Li &038 Fung 2009). And because of the excellent brand building and management capability, massive advertising efforts as well as leading research and development capability, the products from multinational cosmetics corporations stand for theatrical role, reliability and reputation in hearts of Chinese consumers compared with the local brands (Li &038 Fung 2009).For Herborist, to beat these international cosmetics giants and win more customers from them are really a largish challenge. 2. 4. 2 Image of make in China The tag of made in china often stands for cheap price while poor quality, which also exits in skin care products (Wharton n. d). Just cor moveing the foreign brands stands for quality, reliability and reputation, the Chinese made skin care products for foreign customers pith poor in quality and even the same for some Chinese consumers.For Herborist, this kind of phenomenon is a great threat to both explode the domestic market share and especially position itself for the international markets. 2. 4. 3 Investment risk (ROI and cash flow) From the official website of Herborist (2010), the company has planed to invest ? 170 million to enhance the market share. Although it is good news for Herborists future development, it has to consider the bring out on the period of return on investment (ROI).Herborist has the experience of besides retentive time ROI, for instance, Herborist began to make profit after it came into the domestic cosmetic market septenary years (Herborist official website 2010). If the return on this times ? 170 million investment still last besides foresightful, Herborist has to face the risk of cash flow problem, which may result in blown-up financial dilemma for Herborist. 2. 4. 4 Economic crisis Due to the economic crisis in the recent year, the acquire power is decreased and p reference is inclined to relatively cheap products which for Herborist oriented on nerve to high cosmetic products is a kind of pressure (Li &038 Fung 2009). . 0 Objectives 3. 1 Corporate objective Corporate objective for Herborist is to become a human beings class enterprise with the capability of revolution and creativity to not only continuously uncover high quality new products to run the needs of the consumers but also take hold good quality products under the concept of integrating Traditional Chinese Medicine into the latest fruits of modern biotechnology (Herborist official website 2010). 3. 2 selling objectives The marketing objectives for Herborist include two parts.On the one hand, Herborist plans to put out its cover of domestic distribution channels to 170 main cities and enlarge the retail terminals from 700 to 1,200. On the other hand, Herborist plans to expand its market outside the China mainland market via the cooperation with Sephora (Herborist official w ebsite 2010). Herborist aims to achieve ? 1. 35 billion of sales revenue in the end of 2014 and increase the revenue as well as Compound Average Growth step (CAGR) to 21. 98% within the next 5 years (Herborist official website 2010). . 0 Marketing strategy The following is the market strategy for Herborist including the targeted market, position as well as marketing mix strategies, which is based on the above analysis. 4. 1 Target market As the organic cosmetic company, Herborist is specialized in herbal cosmetics. In the full of furious competition cosmetic market of China, the primary consumer target for Herborist is center to hurrying income white collar females who prefer natural, loco but effective skin care products.The secondary consumer target is college female students, who manner for mild products to maintain their young and mellisonant skins. This segment is focused on these female college students who prefer acquire international cosmetic brand while have pressur es on the set part. According to the survey that there is an increasing rate on the purchasing capability of female college or university students towards substance to high end cosmetic products, which is an definitive segment for Herborist to focus(AMA Communication Services). . 2 Positioning strategy Herborist will position itself as the middle to high end cosmetic products which focuses on the balance between traditional Chinese medicine theories adherence to Chinese elements of Tai chi, lotus, green and the high-tech authority of modern technology to continuously introduce high quality new products to run the needs of the consumers on their skin care. 4. Marketing mix Marketing mix describes these different elements such as price, product, promotion, place, people, and act and so on that marketers need to consider (Elliott, Rundle-Thiele, &038 Waller 2010), which is essential for Herborist to consider in its marketing process to achieve make better performance. The follo wing will break up four areas of marketing mix including the aspects of price, product, promotion, and place for Herborists marketing process. 4. 3. Product strategy Product is defined as a good, service or idea offered to the market for exchange, which plays a vital role in the marketing process, which is the means for companies to match the functional, social and psychological needs, wants and gather ups of customers (Elliott, Rundle-Thiele, &038 Waller 2010). For Herborist, it is important to emphasize the importance of the product strategy. 4. 3. 1. 1 Product diversification strategy Palmer (2009) advocated the importance of product diversification strategy, which is also proper for Herborist.Products all have their lifecycles and especially the skin care products have the relatively short lifecycle (Kotler&038 Armstrong 2008), so it is important for Herborist to focus on the product innovation and providing a wider product portfolio to meet the market requirements under del iberate market analysis. Moreover, besides the innovation on skin care products, Herborist is recommended to enhance its R&038D capacity on color cosmetics, hair care, and mens cosmetics to perfect it products site of cosmetic products.Only under these activities potentiometerful Herborist meet Chinese customers consumption concept of avocation for practical, fresh, beautiful as well as top quality. 4. 3. 1. 2 Establishing strong brand loyalty Kotler and Armstrong (2008) believe the importance of mental institution of brand loyalty. For Herborist, besides the already built membership system, it is also recommended to apply for the ISO9001 quality system certification, which can enhance the customers office of Herborist to improve customers favorable attitude and purchasing behavior towards Herborists products. 4. 3. 1. Maintenance its orientation As the organic cosmetic brand, its important for Herborist to maintain its advantage on herbal cosmetics. To search the future devel opment, its so essential for Herborist to maintain its image of Chinese characteristics. Only depending on this strong suit, can Herborist have more chances to become world famous cosmetic brand serious like the road of the body shop and Shiseido does. 4. 3. 1. 4 Developing the fisticuffs and project of products One of the important means for gaining more market share is to have a distinct product design and packing (Elliot, Rundle-Thiele &038 Waller 2010).For Herborist, it is essential to focus more on packaging design to attract more consumers with high quality packaging materials for different products series and give people pic of domestic goods while foreign quality. For instance, the introduction of Chinese elements can be take in the product designing and packing such as Chinese painting, lotus and so on are all very Chinese style and give people an impression of elegance and fresh, which is fit for Herborists image of herbal cosmetics. 4. 3. 2 Pricing strategy The pri ce of products setting has great influence on companies rofit and marketing process, as the warring environment changes, companies are recommended to consider when to initiate prices change and when to respond to them (Kotler &038Armstrong 2008). For Herborist, it is important to consider proper pricing strategy to respond to the fluctuant marketing environment. 4. 3. 2. 1 Prestige pricing strategy To maintain the image of middle to high end cosmetic brand and accelerate the dance step of advance to the high-end market, Herborist is recommended to adopt prestige pricing strategy (Kotler &038 Armstrong 2008), which requires Herborist to introduce its new products as a relatively middle to high price.For instance, with the gift box priced at ? cholecalciferol CNY, overbold Tai Chi Mud Mask ? 380 CNY and so on, Herborist has set a relatively good image of middle to high end cosmetic brand which shows the image of prestige, quality and exclusively to Chinese consumers who often hold the opinion that high price means high quality(Whiteman &038 Krug 2008). 4. 3. 2. 2 Product bundle pricing The price of Herborists products is almost at the same level with the international middle to high end cosmetic products especially the Shiseido.To establish its position of middle to high end cosmetic brand, it isnt recommended for Herborist to discount its products alike much and too often, because there is a deep rooted concept among Chinese consumers that cheap means low quality. While to attract consumers, it is needed to offer discount. So it is recommended for Herborist to adopt product bundle pricing, which means combining several products together and go the bundle at a reduced price (Kotler &038 Armstrong 2008), which can help Herborist improve profit via motivating more buying power. . 3. 3 Promotion strategy Promotion is the creation and nutrition of communication with target markets, which makes potential consumers, partners and society aware of. hash out de signed promotion strategy can help Herborist make consumers aware of and enkindle in its products and in effect and efficiently transport its message about the products to the market place (Elliott, Rundle-Thiele&038 Waller2010,). The promotion strategy for Herborist is as below. 4. 3. 3. capital special features Because Chinas consumers are almost pragmatists, if we only use some abstract and vague slogan and general propaganda tactics, it is difficult to convey consumers to buy the products. The victor TCM report nonnegative practical description in advertisement is recommended to highlight the effect of Herborists products to fortify the confidence of consumers brand loyalty. And meanwhile, it is also recommended for Herborist to offer some free trial to consumers to get more feedback after they used, which can also help Herborist promote its products. . 3. 3. 2 advertisement and brand embassador Based on the survey from Solomon (2009), celebrities and beauty experts ha ve considerable influences on cosmetic buys in Chinese market, which results in consumers relying on trial and erroneous belief from celebrities and beauty experts rather than spending too much money on their own cosmetic trials. Due to this special scenario, get wording a proper brand ambassador is recommended for Herborist to attract more customers via the convincing power from celebrities.The proper brand ambassador can help Herborist reach the needs of more consumers and strengthen its healthy and fresh image as herbal cosmetics and enhance its brand cognition. At the same time, it is also intoxicating for Herborist to strengthen its propaganda coverage via ads on the newspapers, cartridge clip as well as in public places such posting large poster in bus localise, MTR station and other public places to attract more attention, which can largely incent consumers desire to purchase Herborists products.Furthermore, sponsoring TV and radio programs on healthy life and beauty can also help Herborist to portray the image of advocating healthy, natural brand. 4. 3. 3. 3 Perfect customer resemblance management (CRM) Palmer (2009) claimed that it is so crucial for companies to develop good customer relationships because good quality alone may be insufficient for a company to gain competitive advantages in increasingly competitive markets, while good customer relation management can supplement a firms competitive advantage.For Herborist, it is necessary to improve the pre sales and after sales service. For instance, before purchasing products from Herborist, it is necessary to give proper and professional suggestions and guidance, which is an important part of brand building. Furthermore, providing professional beauty care lectures for consumers, free skin analysis under the help of professional skin analytical instrument as well as providing customers with improved return protection to enhance the reputation and the customers sense of belonging are all good approaches. 4. 3. Place strategy Herborist has already built a diverse distribution channels to deliver its cosmetic products to consumers, such as opening counters in Chinas major department stores, professional stores and setting up specialty stores to sell its products (Herborist official website 2010). To become a world class Chinese cosmetic enterprise, Herborist is recommended to expand and strengthen its distribution channel. 4. 3. 4. 1 Open counter in big chain supermarkets Big chain supermarkets in China are important sales channels for lower-priced cosmetics products in a long history.While due to the entrance of middle graze brands of broadening products such as Mininurse, Garnier and Maybelline in these retail chains by LOreal, P and other cosmetic giants, big chain Supermarkets in China have become new channels for middle price cosmetic brand to reach a wider audience (Li &038 Fung 2009). These foreign-owned hypermarkets and supermarkets such as Carrefour and Wal-mart as well as locals such as Lianhua , Hualian as well as Trust mart are often the initial choices.For Herborist, it is also recommended to open counters to launch its middle price range products in these hypermarkets and supermarkets reasonable like LOreal, P and other leading cosmetic companies do, which can help Herborist to reach its secondary consumer target of college female students and other consumers who are searching for middle price cosmetic products in supermarkets and hypermarkets. 4. 3. 4. 2 Online sales Online sales may just represent a small share in general cosmetics sales, but we cant discount its potential.And on the basis of the data got from the China mesh Network Information Centre, in the first half of 2007 there are more than 70% of the 162 million Internet population aged under 30 (Li &038 Fung 2009), for Herborist it is a powerful channel to reach parts of its primary and secondary consumers such as the young female white collar and college students. Alth ough Herborist has set up online platforms to show its products, it hasnt begun its online sales.To capture the huge potential, Herborist is recommended to launch online sales on its online platform, just like other successful cosmetics players have make, including DHC from Japan, SaSa and Sephora (Li &038 Fung 2009). For launching online sales, it can help Herborist to save more cost in hiring stores. For instance, some professional software for online sales such as incorporated Distribution System adopt by P have the distinctiveness of quick, effective, low cost, low risk, which is recommended for Herborist to adopt (AMA Communication Services 2010). . 3. 4. 3 Choosing proper agent The failure of Herborist in Hong Kong market is as below (Herborist official website 2010). At first, Herborist without delay copied the sales model of the mainland market, which cant localize itself it the Hong Kong market. Secondly, Herborist invest too much to build its sales channel, which largel y increase its sales cost. Thirdly, the strong resistance to the new brand such as Herborist in the Hong Kong market, which cost Herborist too much to enhance its brand cognitive.For Herborist, it is more suitable to find proper local agent to comfort it expand in the market outside mainland China. For instance, it is recommended for Herborist to relaunch its products in Hong Kong market via the cooperation with SaSa. As a Hong Kong-based cosmetics retailing and beauty serve provider, SaSa has already built well sales communicate and is experienced in solving the problems on new brand cognitive as well as has a good image of cosmetics retailing and beauty services provider (Li &038 Fung 2009), which can facilitate Herborist successfully come into the Hong Kong market. . 3. 4. 4 Pharmacies As a organic cosmetic brand and specialized in herbal cosmetics, Herborist is recommended to launched its products in pharmacies just as these successful cosmeceutical brands do, including French Eau Thermale Avene, Vichy and La Roche-Posay, Japans Kanebo, Freeplus and Shiseido Ferzea and so on.As the research from AMA Communication Services (2010) showing, the skin care products in pharmacies to Chinese consumers means mild, soft, effective and professional, thats why most of the Chinese cosmetic consumers have begun to switch their choices to cosmetic products in pharmacies, especially after the Japan-based SK-II was tested and found to contain some unapproved substances in Chinese counter. For Herborist, pharmacies are recommended distribution channels to gain more potential consumers. 5. Budget for the next three years The Chart below outlines the following three years budgets of Herborist on sales, promotions, distribution, and other related areas from 2011 to 2013. Chart 1 Marketing budget chart for year 2011 to 2013 Items Budget for 2011Budget for 2012Budget for 2013 advertizement ? 30,000? 40,000? 50,000 Sale force learn and input signal? 5,000? 5,000? 5,000 Dist ribution channel expansion? 3,000? 4,000? 5,000 Distribution channel maintenance? 2,000? 2,500? 3,000 Website maintenance? 2,000? 2,000? 2,000 Website improvement ? 0,000? 8,000? 8,000 man relations? 4,000? 4,000? 3,000 R? 20,000? 22,000? 25,000 replete(p)? 76,000? 87,500? 101,000 In thousands (CNY) 6. 0 Projected profit and loss statement The chart below is the d profit and loss statement think of Herborist for year 2011 to 2013 Chart 2 Projected profit and loss statement (2011 &8212 2013) Subjects succession ? Thousands (CNY)Total ? Thousands (CNY) 201120122013201120122013 Total sales revenue ? 1,200,624 ? 107,052 ? 1,093,572? 1,253,049 ? 120,493 ? 1,132,556? 1,367,446 ? 35,240 ? 1,232,206 Advertisement &038Promotion? 30,000? 40,000? 50,000 Sale force training and stimulation? 5,000? 5,000? 5,000 Distribution channel expansion? 3,000? 4,000? 5,000 Distribution channel maintenance? 2,000? 2,500? 3,000 Website maintenance? 2,000? 2,000? 2,000 Website improvement? 10,000? 8,000? 8,000 Public relations? 4,000? 4,000? 3,000 R&038D? 20,000? 22,000? 25,000 Tax ? 21,052? 21,961? 23,997 Other expenses? 10,000? 11,032? 10,243 Total expenses Profit In thousands (CNY) 7. Action program Herborist will implement series of activities to facilitate itself achieve its business objectives in from the year 2011. Chart 3 Implementation schedule Subject123456789101112Total ? (CNY) 76,000,000 Sale force training and stimulation ?? 5,000,000 Modification and improvement on website. ?? 12,000,000 Integrated propagandas campaign on targeting consumers via on print, radio, TV, internet means ????? 4,000,000 sales promotion with the move of the multimedia advertising campaign. ???? 30,000,000 Research and development on products????? 0,000,000 Deliberate research to expand its distribution channels and maintenance ?????? 2,000,000 refinement of its business to more locations. ?????? 3,000,000 8. 0 Control &038 feedback 8. 1 Sales analysis Herborist is planning to strengthen th e systems for sale analysis, due to the seasonable data on sales is curial for the full-length marketing plan. Furthermore, the sales analysis is recommended to be implemented monthly, which can facilitate Herborist to develop contingency plans to address the fast mournful environmental changes, especially the customers needs (Kotler &038 Armstrong 2008). . 2 Market share analysis Under the stage of expansion, the market share analysis is necessary for Herborist to conduct which is recommended to be done every quarter in order to gather in the market closely. 8. 3 Profitability by product To facilitate R&038D programs of Herborist, the profitability by products analysis can be done yearly and used as reference to help Herborist find out its future investment on products pass and innovation which can bring better profit for the company. . 4 Efficiency on advertising, sales promotion analysis To analyze the efficiency of advisements and sales promotion quarterly for Herborist qua rterly is essential, which can make Herborist have a clearly picture of the durability its promotion strategy and facilitate the pass and better orientation of the advertising and sales promotion campaign more effectively in the following quarter. 8. Sales-force efficiency The sales force efficiency should be mensural both on the bases of the sale bulk that they have brought to the company, and the potential capability of staffs in the sale force, which help Herborist best position its sale forces to win more income. 9. 0 Reference AMA Communication Services 2010, High-end cosmetics trends in China, greenbook. org, viewed 11 July 2010, Chinairn 2009, ??????????????? (Successful case study on domestic cosmetic industry), chinairn. om, viewed 12 July 2010, Elliott, G. , Rundle-Thiele, S &038 Waller, D. 2010, Marketing, John Wiley &038 Sons Australia, Ltd, Australia, Herborist official website 2010, Company profile, herborist. com. cn, viewed 11 July 2010, Kotler, P. &038 Armstrong , G. 2008, Principles of marketing, 12th edn, Pearson Education internationalistic, New Jersey, Li &038 Fung 2009, Latest developments of Chinas cosmetics market, Li &038 Fung Research Centre, viewed 11 July 2010, Palmer, A. 009, Introduction to marketing theory and practice, 2nd edn, Oxford University Press, New York, Sephora official website 2010, Sephora stories, sephora. com, viewed 11 July 2010, Simon 2009, Herborist A successful Chinese cosmetics brand, enovate 2010, viewed 13 July 2010, Solomon, J. 2009, Skincare companies dominating the cosmetic market in China, seekingalpha. com, viewed 14 July 2010, Ting, C. 2009, Chinas homegrown makeup gains popularity, Beijing kswchina. om inc. , viewed 12 July 2010, Wharton n. d. , Special report New challenge for made in China, electronic version, Boston Consulting Group, Whiteman, G. &038 Krug, B. 2008, Beauty and the beast Consumer stakeholders demand action in China, vol. 1, Journal of International Business Ethics, Xia XH. 2010,? ?????????? (Suggestions on strategic brand for Herborist), Chinas science and technology research center of citation index evaluation, viewed 14 July 2010,