E-Commerce Thesis

Pages: 7 (1986 words)  ·  Bibliography Sources: 0  ·  File: .docx  ·  Level: College Senior  ·  Topic: Business

E-Commerce

The following pages focus on discussing the necessity and the advantages of addressing the ecommerce as a mean of expanding the customer horizon, which further leads to increased sales and profit, and better visibility and availability.

The development of an ecommerce dimension is a successful strategy for most companies. In this case, concerning a cosmetics producer, the implementation of an e-shop is intended to help reduce distribution costs. The savings can be further invested in production facility upgrading, which further leads to more efficient production, allowing the company to reduce production costs.

By implementing an e-shop the company can reduce the required human resources, given the fact that there is practically less need for traditional shops and salespersons. Also, the company can afford to reduce the number of traditional shops, boutiques, or outlets, therefore reducing costs.

The paper will also provide a description of the company, its strengths and weaknesses, and the context in which it activates, context represented by the cosmetics industry and the trends affecting this market and the company.

The company's strategy will also be discussed, providing an overview on the necessity of addressing ecommerce as a solution for the situation in which the company in case is situated.

Company Description

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The company subjected to the analysis in the following pages is called Beauty Solutions. The company was founded in 1995. The field of activity consists in producing and commercializing a wide range of cosmetic products. The company activates mainly in the United States, but it also sells its products abroad.

Thesis on E-Commerce the Following Pages Focus on Discussing Assignment

The company currently employs 150 people, divided in the following business categories: production -- 90 employees, sales and marketing 37 employees, and top management -- 23 managers worldwide. The number of employees mentioned for the sales and marketing division only refers to specialists that develop the company's strategy in this area, in the U.S. And abroad, and does not include the actual salespersons involved in the actual sale of the company's products. This is because the company does not have its own traditional shop, but collaborates with retailers.

Since its establishment, the company has managed to continuously expand its range of cosmetic products. Currently, the company produces and commercializes cosmetic products for hair, skincare, and makeup. The products can be found in both regular variants and professional ones, for salon usage.

Cosmetics Industry Analysis

Although the financial and economic crisis that has been affecting the entire world has made an important negative impact on most industries, whether they are global or local, it seems that the cosmetics industry was not significantly affected by this financial phenomenon. Even more, there are several regions across the world where the cosmetics industry is actually expanding.

The most important developing market is considered to be the Asian region at the moment, represented mainly by China and Japan. Other developing markets include Brazil, Russia, and India. These markets present plenty of unexploited potential. The situation seems to favor niche players, smaller companies in the cosmetics industry, rather than cosmetics giants, like Beiersdorf, Procter & Gamble, and L'Oreal (Pitman, 2009).

The trends that are currently affecting this industry and its players are based on new product developments. One of the most important trends in the cosmetics industry is represented by customers' orientation towards nutri-cosmetics.

Another trend affecting the cosmetics industry is represented by natural cosmetics, or herbal cosmetics. Such products contain no synthetics. They are considered to be safe and to have no side-effects. The demand for such products is increasing because consumers are more oriented towards a healthier, more natural lifestyle that includes cosmetics also.

Marketing Plan

Strategy

Given its important experience on the cosmetics market, the company has learned that business success depends on the company's flexibility and its adaptability to market modifications. Therefore, the company's general strategy consists in adapting to the trends that are affecting the cosmetics market.

In order to achieve this objective it is very important to be one step ahead of competitors, if possible. The company cannot afford for a certain type of new product to be discovered by competitors, introduced on the market, and then produced by our company.

As a consequence, the company is periodically testing consumers' preferences, needs, and requirements. The best source of information regarding any future product developments is represented by consumers. Based on consumer surveys, the company gets an idea on potential product development directions it must follow in order to come up with new or improved products that customers would appreciate.

Product strategy. The company focuses the product strategy on diversity and quality. As mentioned above, the company commercializes a very wide range of cosmetic products that are able to address each customer category.

In addition to this, the company's new strategy focuses on developing natural, organic products, following consumers' orientation towards this type of products. The company's preoccupation for consumers' health, by developing natural products, is also intended to increase customer loyalty.

Distribution strategy. Although the financial crisis did not have a significant negative impact on the global cosmetics industry, the company's sales have decreased in comparison with the period before the crisis.

In order to revive sales, the company intends to create an e-shop in order to facilitate the sales activity. As a consequence, the company will require a smaller number of salespersons, allowing the company to reduce distribution costs. The e-shop is also intended to create a stronger image in consumers' mind, by associating the company and its products with a strong Internet presence.

The new develop e-shop will also help increase the number of customers and to expand to new, potential customers. For example, busy people, with very little for traditional shopping, or product testing, will be able to purchase the company's products directly from the website, they will be able to quickly compare prices, to check the ingredients list, and to save time by doing so.

The e-shop will provide detailed, professional information on the company's products, their usage, benefits, ingredients, or production process, information that the traditional salespersons may not be able to provide in a professional, trustworthy manner.

In addition to this information, the e-shop will provide a section with advice, tips and other useful information for hair, skincare, or makeup related issues. The e-shop will also attract customers by providing a series of video how-tos,

Pricing strategy. Ever since its establishment, the company was very aware that lower prices will attract more customers. This principle has guided the company's pricing strategy until this moment. But the organic products that the company will introduce on the market are not cheap to produce, and this fact will be reflected by the products' consumer price.

Promotional strategy. The e-shop will provide more visibility for the company and its products, information will be much more available for customers. Also, the products' ads can be posted online for customers to see. The most effective advertising solution in this case also relies on the Internet. The company's banner can be posted on several websites visited by consumers that are interested in cosmetics products commercialized by the company.

Company Structure

The company is divided in the following departments: Financial Department, Marketing Department, and the Human Resources Department. As one may observe, the company's organizational structure is a very simple and flexible one, allowing the company to easily adapt to any changes determined by the external environment.

The company is managed by a General Manager, who collaborates with the rest of the managers in order to establish the company's strategic direction, to establish general goals and specific objectives and to ensure these objectives are attained with a minimum of resources.

The Financial Department is run by the Financial Manager. The department is in charge of establishing the company's financial requirements that must be met in order to achieve the established objectives. The Financial Department must ensure the company's financial resources are used in the most efficient manner.

The Marketing Department is divided into the Product Development Division and the Sales Division. The Product Development Division is run by the Development Manager. The main tasks of this division consist in market and customer surveys and analysis, in anticipating trends on the cosmetics market, and on the actual development of new products. Related activities include production, product testing, and others.

The Sales Division is run by the Sales Manager. The most important task of this division consists in collaborating with the Financial Department in order to forecast the company's sales. Other than this, the Sales Division is in charge of the entire marketing mix: the product strategy designed in collaboration with the Product Development Division, the pricing strategy designed in collaboration with the financial Department, the promotional strategy, and the distribution strategy.

The most important resource any company can exploit is represented by the human resource. This is why the Human Resources Department of the company, run by the Human Resources Manager, is very careful in recruiting, selecting, and training of potential and existing personnel. The company's success relies on the quality of its products, which is a reflection… [END OF PREVIEW] . . . READ MORE

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APA Style

E-Commerce.  (2009, October 27).  Retrieved June 3, 2020, from https://www.essaytown.com/subjects/paper/e-commerce-following-pages-focus-discussing/191479

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"E-Commerce."  Essaytown.com.  October 27, 2009.  Accessed June 3, 2020.
https://www.essaytown.com/subjects/paper/e-commerce-following-pages-focus-discussing/191479.