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Introduction: Business Studies Report: The Body Shop
The Body Shop is an internationally famous cosmetic brand based in London, UK. Since 1976, the company has set its foot in the industry of luxury cosmetics, skin care products, and perfume. Currently, this company possesses over three thousand outlets and, moreover, one thousand products. This company has expanded its business to almost 65 countries. The present report concentrates on the marketing strategies of The Body Shop. This report also emphasizes the company’s HR strategy, considering its recruitment strategy, training, and development programs. The financial management strategies of The Body Shop also remain one of the main concerns of this present report.
Marketing Strategies
The Body Shop is a British luxury cosmetic brand, L’Oréal owned this brand between the year 2006 to 2017, and then the company was sold to a Brazilian company Natura at 880 million (thebodyshop.com, 2022). The parent company believes in no animal cruelty during making its product.
Segmentation and Targeting
The Body Shop primarily targeted women as its target customer in the market. The products of the company targeted employed women who are willing to look attractive in the workplace and the women who are facing problems regarding their dry skin under AC. This company segmented its product regarding the age of the customers, based on the economic class of the customers. The product of this company also manufactures body care products for men also.
Positioning
People are nowadays more conscious regarding their healthy lifestyles. They preferred to use organic and natural products on their skins. As per the customers' requirements, the company made its product including the ingredients like sugarcane, seaweed, aloe vera, honey, tea, and many other natural ingredients. This company puts more emphasis on health over glamour, which makes the company unique based on its positioning strategy.
The 4P’s of Marketing
The 4Ps of the marketing strategy of The Body shop is the main factor that helped the company to establish its brand equity. The 4P of marketing strategy is consist of the company’s product, price, packaging, and promotion (Paurova and Nadanyiova, 2020). The implementation process of this model is discussed below.
Figure 1: The 4P’s of marketing strategy
Products: This company offers around 400 body care products, and moreover 500 miscellaneous products. This company largely uses herbal ingredients while making its product considering the preference of the customer’s healthy lifestyles. The perfume bar of the company includes scenting oils and lotions provided at every store that does not charge anything extra for the same.
Price: The company is admired for the affordability of its products. The company kept the price of its products in the range of low to medium. It is important to know the ability of expenses of its target customers. It is also necessary to know the price range of its competitor’s product.
Packaging: The Body Shop makes its packaging of the products very simple. This company introduced eight new sub-brands where in its packaging the and the logo of the company get less importance (Moningkaet al. 2020). This company also provides the facility for testers, which involves smelling, and comparing lotions and perfumes before buying. The company mostly invested its concern in the quality of the products and their impact on the environment.
Promotion: This company does not believe in the idea of promotion rather the company believes in informing people about its product. The uses of models never have been seen in the promotion program of the company. The words in the promotional pieces are selected very carefully so that it does not produce any misconception or insecurities in the mind of customers.
Human Resources (HR) Strategies
The human Resource strategy of a company concentrated on planning for managing the available human resources, capital, and many other resources to deliver different kinds of business-related activities. HR strategies involve recruiting, performance evaluation and appraisal, compensation, and development. One of the important HR strategies for The Body Shop is its recruitment strategy.
Recruitment Strategy
This company possesses a unique recruitment strategy. The recruitment strategy of the company includes a process d Open Hiring Policy. This recruitment process of The Body Shop consists of basically 3 requirements. First, the applicant must be eligible for the required job in the company as per their designation. The second one is the capability of the applicant to work for eight hours, and finally, the applicant must be able to lift a weight of more than 50 pounds. Hence,The Body Shop conducts a first come first serve base recruitment process. (Chairunnisaet al. 2019). Such recruitment process produces hope among the unemployed persons.
Training and Development Process
The training and development procedure is a kind of reward to make the company’s employees aware of their roles and responsibilities as per the designation. The company emphasized several aspects while providing the training. This company requires hiring such employees who are daredevils and challenge acceptors. The training program of the British luxury cosmetic brand includes many skill-learning procedures that enhance one’s communication skills, questioning skills, and active listening skills which concern developing self-awareness. The company’s training program introduces a few key features. The participants were asked to give marks themselves based on the earlier mentioned factor. It helps to determine the improvement of the participant. The participant shared their experiences of the whole training and development process and the benefits of the program at the end. Not onlythe motive of this program is to aware the employees about their roles and responsibilities but also it helps the individual to develop and assessed their own personalities.
Financial Management Strategies
The Body shop is an example of a small store becoming a world giant as the world’s largest retailer. The financial management strategy of a company includes setting guidelines for the expanses of the company, meeting business goals as per effective financial decisions, and many other aspects. The analysis of the financial policy of the company may help to make assumptions regarding the effectiveness of the strategies that are used.
Profit and loss
The enormous growth of The Body Shop has been seen from 2016 to 2019, in this period the company experienced a gradual increase in its revenue. The highest revenue has been noticed in 2019, with a value of 805 million British pounds, which was six million more than the previous year’s revenue (statista.com, 2022).
Figure 2: Total revenue generated by The Body Shop worldwide from 2016 to 2019
As the pandemic situation introduced the company faced a severe loss in its business. The global beauty industry was become shocked as the pandemic situation arrives and that lead to several shop closures. The industry firmly tried to cope with the crisis by switching its manufacturing products to hand sanitizers and many other cleaning agents. As cosmetics are not counted as the essential purchases so there was a decrease in sales for the company. Still, online sales help to survive this crisis period.
Estimation of Sales Level
When it comes to the point of attracting consumers, the continuous assessment of the level of sales remains fruitful. Once The Body Shop was a small store now it becomes the largest British luxury cosmetic brand, it suggested that effective decisions were made on time based on the consumer’s preferences and demands (Ganatra et al. 2021). The effective practice of the company, estimation of sales level, helps to assess the current sales volume of the company and can compare with the sales rate of the previous year and can determine its future financial strategy.
Financial Forecasting
The prospects of financial forecasting are effective for choosing the right management strategies. The body shape used the two familiar methods of forecasting, one is the T-account, and the other one is the percentage-of-sales. Both approaches put a contribution on make a prediction of the profitability of a particular investment by the company. These two approaches gave dividends to the company and make the losses insignificant.
Balance Sheet
The golden period of The Body Shop refers to the period from 2016 to 2019, before the Covid situation. A balance sheet of a company is an economic statement based on the company’s liabilities, assets, profits, and losses. For example, in the financial year 2018, The Body Shop’s value of total assets was 531 million, and the total liabilities of the company were 180 million. The company’s investment in the products was 194 million, and the gross profit was 612 million (ivypanda.com, 2020). The balance sheet of the company and the income sheet suggested that the company is increasing its profits every year.
Conclusion
In conclusion, this report provides a well-informed and detailed case study of The Body Shop consisting of its marketing, human resource, and financial management strategies of the company. It has been found in the report that the Body Shop maintained a responsible corporate social responsibility very well and committed to creating environment-friendly business processes. The company prioritizes the health of its product despite its packaging and promotion. The Body Shop practiced a unique recruitment process and effective training and development program. The estimation of sales level, financial forecasting, and balance sheet was effective for The Body Shop to manage its financial strategy.
References
Journals
Chairunnisa, S.S., Fahmi, I. and Jahroh, S., 2019. How important is green marketing mix for consumer? lesson from The Body Shop. JurnalManajemen, 23(2), pp.321-337.
Ganatra, V., Sinha, R., Srishti, S., Pandey, R., Kadam, P., Ristiansyah, S.A., Sin, L.G., Yin, C.L., Kee, D.M.H., Jin, L.Y. and Wei, O.Y., 2021. The Body Shop" Forever Against Animal Testing”. International Journal of Applied Business and International Management (IJABIM), 6(1), pp.90-100.
Moningka, V.A., Pangemanan, S.S. and Arie, F.V., 2020. The Influence Of Natural Cosmetics And Product Packaging Design On Female Consumer Purchasing Intention In Manado (Study Case: The Body Shop). Jurnal EMBA: JurnalRiset Ekonomi, Manajemen, Bisnis dan Akuntansi, 8(4).
Paurova, V. and Nadanyiova, M., 2020. Marketing mix as part of Marketing Strategy used in the Service Industries. Economic and Social Development: Book of Proceedings, pp.649-657.
Saini, A., 2022. Mapping 4Ps Of Marketing with Business Intelligence: The Way to The Future of Marketing. Central European Management Journal, 30(3), pp.163-173.
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