MARY KAY COSMETICS: ASIAN MARKET ENTRY CASE STUDY International Marketing 466 Fall 2003 Prof.

Hasson Curran Dandurand, the senior vice president o Mar! Ka! Cos"etics Inc#$s %MKC& '(o)a( "ar*etin' 'roup is considerin' ho+ to e,pand the co"pan!$s internationa( operation# She is de)atin' +hich e(e"ents o MKC$s cu(ture, phi(osoph!, product (ine, and "ar*etin' pro'ra"s "i'ht )e trans era)(e )oth in 'enera( and in particu(ar in respect the China and -apan, t+o "a.or Asian "ar*ets in +hich MKC does not have a presence# Dandurand "ust decide +hether to enter either or )oth o these "ar*ets %or neither& and, i so, +hat "ar*etin' entr! strate'! to pursue# This case gives your global marketing team the opportunity to: 1) explore why two companies (Avon and MK ) in the same business (the direct selling o! cosmetics) di!!er so greatly in the percentages o! their sales that are international ") examine the trans!erability o! a corporate value system developed in the #nited $tates to !oreign subsidiaries %) identi!y the criteria that should determine which country markets a multinational should enter and to assess two countries against these criteria &) contrast the implications !or marketing strategy and tactics o! being a late entrant in a mature market versus a relatively early entrant in an emerging market The ob'ective o! the case is to !ocus on the !ollowing issues and dilemmas: /# (hy has MK not been as success!ul as Avon in penetrating international markets) Answer in terms o! the !ollowing: Co"pare Avon$s internationa( sa(e as a 0 o tota( revenue vs# MKC# Usin' the in or"ation in !our case stud! as o /112, "a*e a chart %si"i(ar to a countr! co"parison chart3co"p(ete +ith a third co(u"n 4I"p(ications or MKC$s Mar*etin' Strate'!5, co"parin' Avon to MKC in ter"s o Revenues, Non6U#S# revenues, 7roducts adopted or non6U#S# "ar*ets, Mana'e"ent st!(e, Cu(t o 7ersona(it!, Direct se((in' "ethod used and Co"pan! character# Can a U#S# direct se((in' co"pan! specia(i8in' in cos"etics )e success u( in orei'n "ar*ets9 :h!9 E,p(ain Co"pare the part! p(an "ethod to one6on6one direct se((in'# :hat is the i"a'e o Mar! Ka! herse( 9 :hat is the cause o MKC$s (ac*(uster per or"ance9 E,p(ain in speci ics#

;# (hat criteria should *andurand use in deciding how to prioriti+e !oreign market entry opportunities) Answer in terms o! the !ollowing: :hat steps is MKC ta*in' to p(ace rene+ed e"phasis on internationa( sa(es9 :h! are these chan'es )ein' "ade9 <aced +ith /= su)sidiaries o var!in' >ua(it!, ho+ shou(d the! )e 'rouped9 :h!9 :hat shou(d the countr! se(ection criteria )e9 Identi ! at (east ei'ht# :h!9 2# (hat are the arguments !or and against MK entry into a) ,apan and b) hina) Ma*e each a chart co"p(ete +ith a co(u"n 4I"p(ications or MKC$s Mar*etin' Strate'!5# %T+o charts, one or -apan one or China# Each chart +i(( have three co(u"ns3<or, A'ainst, I"p(ications or MKC$s Mar*etin' Strate'!#& ?# -roup .resentation/ (hat marketing recommendations would you make to *andurand i! she decides to enter a) ,apan and b) hina) #sing the & step executive summary !ormat !or each country0 (page %1 in *eveloping 2!!ective Marketing ommunications and .lans)0 answer in terms o! the !ollowing: -apan vs# China# De ine the 7ro)(e"s and Cha((en'es especia((! in ter"s o the co"petition# Tar'et "ar*et 7roduct "i, 7ositionin'6@o+ to enter 7ac*a'in' 7ricin' Distri)ution3+here to enter Co""unications and Advertisin' 7(an <undin'6@o+ "uch "ar*etin' "one! +ou(d !ou need to enter each "ar*et9 :hat +as !our undin' a"ount "ethodo(o'!9 @o+ +ou(d !ou a((ocate !our )ud'et accordin' to the ?7$s9 Ans+er >uestions /,; A 2 )! the )e'innin' o c(ass Nove")er ;B# Ci"it !our +ritin' to a "a,i"u" o 2 /D; pa'es# The >uestions /, ; A 2 are to )e individua((! turned in and a cop! shared +ith !our tea"# Since the presentation is a tea" assi'n"ent, !ou "ust prepare this assi'n"ent at /;E0 o each o !ou individua( capa)i(ities and e orts# 7(ease prepare an introductor! tit(e s(ide +ith the tea"$s na"e, the individua(s on the tea", tit(e o the presentation and the date# 7(ease "a*e a hard cop! )e ore the date o presentation to turn into !our instructor# I su''est !ou read a(( the in or"ation on "! +e)site and in !our Deve(opin' E ective Mar*etin' and Co""unications A 7(ans# @ave un and use !our creativit!F