Strength: Among the main talents of Shiseido is its high quality products. To be able to satisfy customers, the company invested a great deal on research and development and performed hard on product differentiation. Its R&D sector is complete and on the top of technology. The merchandise stock portfolio of the company is strong; it has additionally launched inexpensive Cosmenity lines and brands for customers who cannot manage too much. High inventory turnover helps the business's avoid cashflow problems (that will then shown on the financial performance of the organization), while goodwill and strong positioned brands keep the firm in a robust market position. Besides, other aspects such as advertising, large amount of outlets, the development of membership team, good communication with associated stores and excellent expansion in international sales all make the business more competitive.
Weakness: While customer devotion to Shiseido is strong in the rural areas, it is weaker in the urban areas. The business has problems when rivalling with those segments with lower quality. Although the overseas sales keep increasing, it only account 15% of the full total income. Moreover, the company classify customers by age group, which is not so appropriate. Highly reliant on Japan and geographic attention will limit the company's development.
Opportunities: As the customers' needs become diverse nowadays, there tend to be more chances for all your companies in the industry to generate profits by meet up with the customers' necessity. Men's beauty products market can be seen as a good chance for Shiseido, and the strategic alliance with Johnson and Johnson will also bring advantage to the organization. Besides, since Shiseido chief executive is now a chair of the makeup products industry connection, the brand could be more famous.
Threats: The competitions between both companies from Japan and overseas and Shiseido are strong. Especially in these years the government's guidelines about opening japan beauty products industry and the economical slowdown are all negative factors to Shiseido. While the company has to face international companies such as Utmost Factor, Revlon and Clinique inserted japan market with low prices, counterfeit goods are also problematic. In 1992 the Ministry of Health prohibited common materials approved for use in cosmetics outside Japan, which required the reformulation of most products. Last however, not lease, the ratio of products are branded is too low (5%) for Shiseido, this means its competitors may easily copy the business's product without extra cost.
2, How can Shiseido deal with the men's market
Nowadays, it is not unusual for a man to employ a cream for lifting or use some standard cosmetics. While the degree of both technology and life quality have raised, men started to worry more about their outlooks as women do. More men, especially those between 18 and 35 years, are no more ashamed using makeup, heading to beauty store or even taking spa for themselves. The reason why they do so is just because they want to look after their outlooks to feel better. Besides, middle age group men are also paying more focus on their appearance, they would like to "stay" and seem to be young as well. In addition, since there are increasingly more pollution on the earth, using some cream or cream that can help preventing the pollution would be a good notion for those men who will work outside the whole day. Therefore, sections of products can be developed to meet these different group's needs, and it is sure the men's market will develop extremely fast.
Since men's makeup accounted for no more than 12% of the total sales within Shiseido and its major competitors in Japan, it is clear that although there exists the men's market, but it isn't exploited enough. Kanebo might be the main rival of Shiseido in the men local market. To obtain additional market share, Shiseido need to make use of its R&D sector successfully and more technology will be utilized for developing men's makeup products. For the merchandise, they should be designed easy to use and have more functions within a single product, because unlike women, most men do not have the tolerance to do the facial skin maintenance for hours. For the campaign, the suggestion is the fact that professional men's makeup products shop can be setup to build masculine image rather than female one which might cause unnecessary prejudice.
3, Shift syndication away or not
The Shiseido's majority of cosmetics are sent out through the selective system; they have contracts with exclusive stores. These mom and pop stores help create a good brand image for Shiseido as unique high quality and value. Because of this people can only just find Shiseido's products in outlets chosen by Shiseido and the retailers are ranked relating to sales of Shiseido products, higher category shops can have more benefits from the business. Besides, the business provides enough information to employees in different stores, to make sure they are have good knowledge about the products, and then they can give proper suggestions when their customers are choosing products. In this manner, trust and good romantic relationship are designed between consumers and the business. However, this method of distribution has disadvantages. But the brand image is good, the price to keep up such an elaborate system is quite high; the firm has to negotiate with many of these outlets to renew agreements annually and the business also may face the threat of lose control of its products due to some blind competition.
When point out the shift distribution strategy, because the company's four other brands that are cheaper products and don't hold Shiseido's name can be purchased in department stores successfully, to sell other Shiseido's products in department stores and supermarket will be a quick approach to improving deal. Furthermore, since more customers now favor more personal shopping experience in beauty stores, their needs have moved to self-selection products, the assistance of its representatives will no longer need. Thus to alter its products into shops and supermarkets can help reduce the price tag on the business.
4, Insurance policy of classify customers based on age
We are in the contemporary society that respect beautiful nearly as good. A lot of people who are "good people" on the TV or periodicals are good-looking. People admire beautiful things directly while they don't achieve this task to things that are not so really. So most people use makeup such as firming or against era to keep their exterior image seem to be young so long as possible. It really is quite normal nowadays that a lot of women who are somewhat older than 55 years which is one of the final stage of the Shiseido's classification, they actually assume that they aren't old, they don't want to be seen as old grandma. To make themselves looks more radiant is why these women use cosmetics. Thus if there is such a classification for the company's products, they can not find the appropriate product corresponding to the age category, plus they may choose those products belongs to the fourth level which is for years 35-54 instead. If that occurs, the classification is meaningless. Moreover, a great deal of young girls do not need to be studied as little females, they would like to be, become, or buy the products for 18 years old. They may also not satisfy to be sorted to the group that their real get older belongs to. The identical things would happen to all the age groups. In addition, for individuals whose ages are just on the ends of this stages for example 17 years or 24 years, it is hard to clarify how to choose their products from Shiseido.
In sum, because so many people do not want to seem to be as their real age group, to classify by era is not sensible.
5, Maintain competency against global competition
First and most important, the Shiseido need to keep and grow advantages it has recently got on R&D sector. Creation and innovation are crucial for the industry and products with newer and better functions are always customers' preference.
Retail stores need to be controlled carefully, since it isn't only a way that the company can communicate with customers, but also a channel for collect the market segments' trend.
To develop the men's makeup products market, by offering wide selection of products, the organization can win the market share quickly.
The corporate viewpoint need to be continued to help keep up with the goodwill and brand image of the firm. Besides, to lessen the using of polluting products in the makeup is another way to get trust and compliment from modern culture.
Differentiation while keep the quality of the products at the same time is another key to success; the company can develop high quality products for people different in area, gender, time and body condition to meet their need.
Pay more attention to foreign markets is very important to keep strong in the global competition. The company's brand image of health is welcomed for folks who are worried about chemicals.
Finally, the strategic alliance with Johnson and Johnson of america is an excellent chance for the business's development, by using Johnson and Johnson, Shiseido can except a increase on the profit and compete with rivals more easier in the areas where in fact the company is not well run.
