Mary Kay India: The Hair Care Product Line Opportunity Essay
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1. How would you characterize the branded and packaged Indian hair care category in 2010? In 2010, with Lotus & Bamboo soap bar was introduced by Mary Kay in India, May Kay was approved a customized product for a specific country or region market for the first time. Moreover, the branded and packaged Indian care category of Mary Kay was growing up and expanding its product to attract more potential customers. Mary Kay brand has been developing massive products in India until 2010 with lower price compared with past several years.
By late 2010, there were more independent beauty consultants in more regions in India, and most of the businesses were distributed in northern, western and northeastern area of India. Simultaneously, in the late 2010, Mary Kay also meets competition from other representative of hair care products. Market research has shown that the growth potential of around 50% for the coming 5 years between 2010 and 2014.
2. How would you assess the “fit” of a hair care product line with Mary Kay’s offering in India? The acceptance of hair care products line is growing with changes of hair care habit of customers in India. Personally, the “fit” project of hair care product line with Mary Kay’s offering in India was pretty successful and in time. Based on the unique hair care habit among Indians, it might be a slow process to introduce the products into a new Asian market for Mary Kay. After all, hair cares like shampoo and conditioner are not as easily as soap bars to be accepted in India, which means changing hair care lifestyle for most people there.
Therefore, launching hair care products in 2012 is the very time for India. Additionally, independent beauty consultants are the positive factor to motivate to sell products in India. Furthermore, low price promotion strategy also worked for selling hair care in India, according to the data in the case, nearly 87 percent of hair care products were sold at mass-market prices, however, only 13 percent of the products were sold at prestige or premium prices.
3.What is the market potential for a hair care marketed by Mary Kay India? According to the research, the Indian upper and consuming classes were growing and were expected to total over 500 million individual, which might be reckoned as potential consumers of hair care products. It seems that Mary Kay India is targeted to young, working people who are pursuing good look with an average age of 26, especially women group. Given to the increasing population in India, in the coming years, the number of young generation will also be expected to grow up. Meanwhile, the expected young generation will grow up under impact of new body care lifestyle in India, (who are accustomed to using shampoo and conditioner instead of oil, washing hair frequently, caring about the appearance),thus, it could be forecasted that the market of hair care products would be extended in the near future.
4.At what dollar sales volumes will the Mary Kay India hair care line be profitable? Give to the estimated scale of production of a total of 600,000 units of the 6-milliliter sachets, total cost of production and distribution would probably be $600,000. Then, the highest estimated total cost of production and delivery for the 100 milliliter bottles would be $1,410,000, but the lowest would sum up to $1,110,000. Moreover, when take advertising, promotion, and sales into consideration, the costs would probably come to $705,000, while the highest total amount of sales could be even more than $2,715,000.
5. Should Mary Kay introduce a hair care line in India? Why or Why not? As far as I am concerned, Mary Kay should introduce a hair care line in India. On the basis of the data above, the highest total amount of sales could come to $2,715,000 for Mary Kay, which means huge profit in India market. What is more, as the transformation of lifestyle among young Indians, the number of people who tend to use hair care products could rise up in the coming decades.
Once hair care products are accepted by Indian people, it means more opportunities and profit growth point for Mary Kay brand. For instance, Mary Kay company could develop more hair care products with specific functions to satisfy the increasingly demand among people. Lastly, another advantage to introduce Mary Kay to India is that labor price in India is pretty low, which illustrates that the cost to produce hair care products in India could be controlled easily. In general, introducing hair care products to India is a wise action for Mary Kay company.