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INDUSTRY ANALYSIS

Of

WOMEN ACCESSORIES (LAKME, REVLON, MAC)

Presented to: Prof. Kalpana Chauhan

Presented By: K.Venkateswara Reddy (056) Nitesh Kumar Singh (66) Hunny Verma (128) Kangkan Saikia (129)

INRODUCTION:
Over all analysis of women accessories, companies are MAC, LAKME, and Revlon.

M.A.C
Make-up Art Cosmetics, better known as MAC or MAC Cosmetics, is a manufacturer of cosmetics founded and headquartered in Toronto, Canada.

History of MAC:
MAC Cosmetics, Makeup Art Cosmetics, was founded in Toronto, Canada by Frank Toskan and Frank Angelo in 1984. The first U.S MAC store opened in 1991, in Greenwich Village, New York. The company's products were initially specifically designed for professional make-up artists, but are now sold to consumers worldwide. Este Lauder Companies acquired controlling interest of MAC in 1994, then completed their acquisition of the company in 1998. Original founder, Frank Angelo, died in 1997 due to complications during surgery Products.

PRODUCTS:
On January 28, 2011, Warner Bros. Consumer Products announced that DC Comics' iconic heroine Wonder Woman will team up with MAC Cosmetics to create a Wonder Woman makeup collection that will be available in MAC stores in the spring of 2011. The collection includes blush, eye shadow, eyeliner, lip gloss, lipstick, mascara, mineral powder and nail polish.

INDUSTRY ANALYSIS:
The Indian Mac cosmetics industry has seen strong growth over the past few years and emerged as one of the industries holding huge potential for further growth. In 2009, the Mac cosmetics industry registered impressive sales of INR 356.6 Billion (US$ 7.1 Billion) despite the global economic recession. The sector has mainly been driven by improving purchasing power and

rising fashion consciousness of the Indian population. Moreover, the industry players have been spending readily on the promotional activities to increase consumer awareness. According to our new research report Indian Cosmetic Sector Analysis (2009-2012), the Indian cosmetics sector is expected to witness noteworthy growth rate in the near future owing to rising beauty concern of both men and women. The industry holds promising growth prospects for both existing and new players. To support this evidence, we have done extensive analysis of various segments of the cosmetics industry keeping in view of both the services and products sector. The baseline for the optimistic future outlook of the Indian cosmetics industry there has been a rise in variety of products offered by the industry players. The companies have started going for rural expansion and are offering specialized products to generate revenues from all the corners. Improvement and strengthening of the Indian economy from 2010 will also pave the way for the Indian cosmetics market over the forecast period. Our new research report incorporates an extensive research and rational analysis of the cosmetics industry in India. It provides segment level analysis of the industry along with emerging trends that may shape up with the betterment of economic conditions. The research will help consultants, industry analysts and vendors to get in-depth knowledge of the current, past and future performance of the industry. The report also provides information about consumer behavior, particularly men and rural population, with regard to cosmetic products

COMPETITION:
LOreal & Revlon Avon Products (AVP), and Estee Lauder Companies (EL) Etc... These are the competitors of the M.A.C Cosmetics.

REVLON
Revlon is an American cosmetics, skin care, fragrance, and personal care company founded in 1932. Revlon was founded in the midst of the Great Depression, 1932, by Charles Revson and his brother Joseph, along with a chemist, Charles Lachman, who contributed the "L" in the Revlon name.[3] Starting with a single product a new type of nail enamel the three founders pooled their resources and developed a unique manufacturing process. Using pigments instead of dyes, Revlon developed a variety of new shades of opaque nail enamel. In 1937, Revlon started selling the polishes in department stores and drug stores. In six years, the company became a multimillion dollar organization. By 1940, Revlon offered an entire manicure line, and added lipstick to the collection. During World War II, Revlon created makeup and related products for the U.S. Army, which was honored in 1944 with the Army-Navy "E" Award for Excellence.

INDUSTRY ANALYSIS:
Revlon makes color cosmetics, fragrances, and anti-per spirants. The company sells its products to consumers through drug stores and mass market retailers such as Wal-Mart Stores (WMT). Sales to Wal-Mart accounts for 23% of the company's total sales. The company earned $1.3 billion in sales and $950K in net income in 2009. Revlon's color cosmetics market share has been dropping since 1998, and the company has had only a single profitable quarter in the last 8 years. The company's profitability began to suffer in the late 90s when overall industry growth in color cosmetics sales to mass retailers began to decline and increasing competition and drugstore consolidation resulted in reduced shelf space for Revlon's products. Since then, Revlon has struggled to keep up with major competitors as its slowing sales and large debt burden have constricted its ability to spend on either R&D or an effective turnaround strategy.

COMPETITION:
Revlon's primary competitors are Procter & Gamble Company (PG), LOreal

(LRLCY), Avon Products (AVP), and Estee Lauder Companies (EL). Revlon is smaller than both LOreal and PG in terms of revenues and resources. However, Revlon has a more focused product offering than these companies and when one considers only color cosmetics sales they are much more comparable. Revlon is the second largest color cosmetics company in the US. Competitors Estee Lauder and Avon get the majority of their revenue outside the US.

LAKME
INTRODUCTION
High priestess of sacred Indian temple meets English army officer who's unwittingly strayed into holy ground. They fall in love. Her orthodox father vows vengeance... That's the story of Lakm, a 19th century opera written by Frenchman Leo Delibes, from which Simone Tata borrowed the name Lakm (French for Lakshmi, the name of the priestess).

INDUSTRY ANALYSIS:
The current size of the Indian cosmetic market is approximately US$ 600 million. Of this, the fastest growing segment is color cosmetics, accounting for around US$ 60 million of the market. Industry sources estimate a rapid growth rate of 20 percent per annum across different segments of the cosmetics industry reflecting an increasing demand for all kinds of beauty and personal care product. Growth has come mainly from the low and medium-priced categories that account for 90 percent of the cosmetics market in terms of volume. Even with a 20 percent average growth rate, the per capita consumption of cosmetics is very low in India. Current per capita expenditure on cosmetics is approximately US$ 0.68 cents as compared to US$ 36.65 in other Asian countries. However, with changing lifestyles, higher disposable incomes, increasing advertising, penetration of satellite television, awareness of

the western world and growing importance of beauty pageants, there have been significant changes and use of cosmetics is on the rise. Lakme, a brand originally introduced by the Tata group of India, now bought over by Hindustan Unilever (HUL) of the Unilever group, Tips & Toes, another domestic player, and Revlon dominate the US$ 60 million color cosmetics market. Multinationals, Revlon of the U.S. and L'Oreal's Maybelline has a dominant share of the small premium lipsticks and nail enamels market. Mass-market products account for a major share; while the premium segment accounts only for a mere 9 per cent in lipsticks and 5 per cent in nail enamels. Lipsticks account for nearly a third of the market at US$ 21 million, while the market for nail enamels is estimated at around US$ 23 million. The color cosmetics segment is very competitive and has a high penetration level of 80 percent. The skin care market in India is estimated at US$ 180 million. Within the last decade, this segment has seen many consumers slowly shift from the mass to the premium end of the market. The penetration rate is high in the skin-care segment as compared to color cosmetics. In the skin-care segment, price and volume played an equal role in value growth. Moisturizing lotions, fairness creams and face cleansers are the popular categories in the skin-care segment and account for approximately 60 percent of the skin-care segment. The major players in these segments are Lakme, Ponds, and Fair & Lovely of the HUL group with a 50 percent market share, followed by players such as J.L. Morison that markets the Nivea range of products in India, Godrej and Revlon. Penetration levels of international cosmetics brands in India are still low. Foreign brands currently constitute only 20 percent of the market. A major reason for low penetration of international brands can be attributed to high pricing. These companies initially gained sales on their international brand image, however, repeat purchases were not forthcoming and to retain their sales growth, several foreign companies reformulated price strategies to tap the large Indian middle class. Urban women in the middle and upper income groups in the age range of 23-50 is the target group for international brands, as this group looks for better products and is willing to pay a premium for international quality products. Industry estimates suggest that there are close to 10 million such women in India.

COMPETITON:
Competitor of Lakme like Revlon and may be line are competing at the upper mass (premium) end cosmetics spectrum. But, Lakme has a wide range of products and prices over the entire market leader. Ranging of competitors from many multinational companies such as Revlon Mod slugging out to chamber may be line & Avon.

This model is the overall Industry analysis of Women accessories.

PORTERS 5 FORCES MODEL 1. The degree of existing rivalry


As our product would be the first of its kind in the market, there is currently no rival.

2. Threat of potential entrants


The threat from potential entrants is rather high as we believe that our target market is lucrative. Furthermore, it is easy to imitate our product mechanism and the barrier to entry is low.

3. Bargaining power of suppliers


The bargaining power of suppliers is high as we will be dependent on them for our supply of cosmetics and equipment manufacturing.

4. Bargaining power of buyer


As we will be selling our product directly to the end users, the bargaining power of the buyers (end users) is low. 5. Threats from substitutes The best substitute to our product would be the over-the-counter cosmetics. The threat is valid and should be taken seriously as there are many established mass manufactured cosmetics brands in the market.