Summary

Mary Kay Inc. is a company started in 1963 by Mary Kay Ash. This is a cosmetic manufacturing firm that she opened with her savings of $5,000 and also with the help of his son Ritchie Rodgers. His son is the current executive chairman of the firm which is the leading seller of skin care and color cosmetics internationally. The company produces over 200 premium products in its state of the art facilities in Dallas Texas and also in hang-Zhou china. These products are available in over 35 markets in five different continents with heavy presence in America, Mexico, Russia and China (Crittenden & Beitelspacher, 2015). The company is striving to expand its wings outside America and as a result, more than 65% of its sales representatives are outside the United States.

The company has been achieving excellent results from the leadership of Mary Kay who is guided by the golden rule principle. She strongly believes in doing unto others what she would like done to her. The results of her hard work have not gone unnoticed as she has received numerous awards. Horatio Alger American Citizen award is just an example of the many awards she has received as a result of her entrepreneurship skills. It is however imperative noting that she is also a family and spiritual woman despite her industrious career (Crittenden & Beitelspacher, 2015). She has however noticed the growth in Asia and pacific markets with special interest in china. China, a market ventured in 1995, is the leading market outside USA with contribution of over 25% of the company’s annual sales. The company is strategic and empowers women and feminism in these markets where women have limited opportunity.

Sheryl Adkins-Green, the company’s vice president in Brand development, has a huge task ahead. The company has identified India as a new market and this lady has the role of developing product portfolio and also builds the company’s brand in India. The company’s top management has identified this as the right time to venture into this very promising Indian market. Growth of upper and consuming class, young and optimistic population and growing number of working women are some of the reasons why the company wants to venture into Indian market (Crittenden & Beitelspacher, 2015). Increased modernization and correct timing are other major reasons that the company aims at venturing in this market. According to the management, this time corresponds to the time the company ventured into Chinese market which has been a success.  Nevertheless, Sheryl Adkins-Green has the role of building a brand, sales force and an effective supply chain if the Indian market will be a success.

Opportunity identification

Mary Kay Inc., has identified an opportunity for growth if it expands its market to India. What actions should Mary Kay Inc. take to ensure that they have a successful entry into the Indian market? The company should first carry out an intensive research to confirm that India is really an opportunity for growth. The growing population of the upper and consuming class and growth of the youthful population in the country offers the company a viable potential market for their products. Nevertheless, the company will have to work hard to ensure that their products get global recognition.  The company must also carry out intensive research on existence of similar companies in the Indian market. Such information will be critical in ensuring successful market entry in India.

Another reason that makes the organization’s top management to think of getting into the Indian market is the comparison of the socio-economic characteristics of India and China. India is likely to have a better market as compared to China due to the better GDP and per capita income as compared to that of China. The management of this organization is convinced that these characteristics are similar in different ways at their respective time of entry (Crittenden & Beitelspacher, 2015). It is also the objective of the company that the major urban centers, New Delhi and Mumbai, will offer the company a perfect market for their products. The cities have a per capita income of $1420 and $2850 respectively.

The company’s chief marketing officer is however wary that the company has to build a strong brand, build sales force and build effective supply chain to service the strong sales force. The company’s vice president for brand development is keen to increase more investment in product development to match the increasing market demand in the country. It will also be imperative for the company to invest infrastructure to ensure that the company maximizes on the real opportunity for growth that the company has identified in India. It will be essential to have a proper positioning and brand equity if the company will have a successful entry into the Indian market.

Alternatives

As earlier mentioned, the company has to be proactive if it will make a successful entry into the Indian market. The brand building of the company’s product in the Indian market will be one of the major steps towards capturing the growth opportunity that Indian market offers to the company (Crittenden & Beitelspacher, 2015).  This will involve intensive media advertising, the literature on the company’s products and culture, educational materials for sales representative and many other promotional items. The company will also have to engage in other activities such as pageants competitions to ensure that the brand is recognized in the country.

Building the company’s brand will not be an easy task. This is because it will involve numerous costs that will ‘’eat’’ into the company’s profits. Media advertisement and sponsoring of promotional events are quite expensive, and this may be a great challenge to the company. It will also be difficult to make the right choice of the products to market in the Indian market. The brand building must involve products that will not compromise quality and value of the product. It is also imperative that that the products introduced in the market must be competitive with other products from competitors (Crittenden & Beitelspacher, 2015). The products must also meet the test of time and should not be easily phased out of the market soon after the introduction. Intensive market information will also be essential to ensure that there is the right mix of different categories of skin care, body care and color.

Building a sales force will be another vital step that the company must adequately address to ensure that the market penetration of the Indian market is successful. The company intends to use direct selling so as to meet as many people as possible. This method will also be significant in brand building of the company products. However, this approach will also be quite expensive. It is imperative noting that the organization will have to hire sales education staff to train the sales representatives. Additionally, the organization will also have to hire several people who will work as the sales representatives and engage in direct selling activities. The process will also involve product demonstration that also adds to the expenses of the company. It will also be difficult to monitor the behaviors of the sales representatives involved in the direct sales.  Some of these people may be lazy and may fail to perform as per the organization’s expectations and hence reduce the productivity of the company.

Creating a supply chain will also be an important role for the product development of the company. The company is expected to import products into Indian market from Canada, China, Korea and United States. Products from these countries are shipped to regional distributors in the cities of New Delhi and Mumbai. Sales representatives will be required to take the products from the distribution centers and distribute them to consumers in all parts of the country (Crittenden & Beitelspacher, 2015). It is, however, imperative noting that this is not an easy task. The shipping process of the products from other countries could be very expensive. Additionally, the long distance could disrupt the products flow in the country due to the uncertainties in the shipment sector. It would be advisable for the company to set up a production plant in India. However, construction of new plants would be very expensive but it will be beneficial in the long run.

Recommendation

Building a brand for the Mary Kay products is the recommended approach that will help the company tap the growth opportunity eminent in the Indian market. Being a new market, it will be prudent for the organization to ensure that the population in India is aware of the existence of these products. Brand building will also entail informing the population the different prices to the variety of products on sale. Brand building will involve product mix and pricing.   When Mary Kay has the right product mix and good pricing strategy, then it will be easy to force market penetration. Increased brand awareness will substantially reduce the cost of creating sales force since people will look for the products and not vise verse (Rezvani, Ghamari & Ghahramani, 2013). Nevertheless, it will also be prudent if the organization makes an investment in infrastructure to ensure cosmetic production in India. This will also cut shipping costs and also the increased number of sales representatives.

References

Crittenden, V., & Beitelspacher, L. (2015). Creating a culture of confidence: An interview with Sheryl Adkins-Green, CMO of Mary Kay Inc. Business Horizons, 58(4), 371-376. http://dx.doi.org/10.1016/j.bushor.2015.02.001

Rezvani, M., Ghamari, Y., & Ghahramani, S. (2013). Identifying Themes of Entrepreneurial Strategy of New Ventures in International Markets Entry. JOEBM, 217-219. http://dx.doi.org/10.7763/joebm.2013.v1.47

 
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