Anna Konovodova | Alina Astapenko Zekie Irikh

DIGITAL GAME 2016

MEN’s BEAUTY MARKET

Part I

MEN’s BEAUTY MARKET

2

The Marketworld trends

❖ Today, the market of Perfumery, Cosmetics, Beauty salons, and SPA for male segments are most attractive and fast-growing;

❖ Most men do NOT want to buy same products as women buy;

❖ The use of cosmetics and perfumes is a must for the person who wants to achieve status in society. Like a good suit, watch and tie;

❖ The younger generation of men believe that the appearance is an indicator of success in business and life;

❖ For many men, the consumption of cosmetic products begins with the ‘game’: the desire to please their lovers;

❖ Men want to look well groomed and effective, but often they are afraid to admit to others that they use the full line of beauty products

3

Importance to Look Well For Men

4

Market men's Wet Shaving - one of the most dynamic in the world, where men quickly "switch"

to better and more expensive products.

5

Target Audience

6

Men’s beard grows daily up to

0.0375 cm, for the year 13.75 cm

But the primary

25-35 y.o High Income

Total Men target audience 18-45 y.o Mid &

High Income

General Information

7

Main TrendsBeard or Not to Beard?

"Growing a beard is the only way a man can publicly display his manhood, without getting

thrown in jail for indecent exposure!“Dr Alun Withey

(creator of 'Do Beards Matter') 8

Hipster Yuppie Yuccie★ Hipsters wear really

nice clothes but have no actual job

★ They tend to congregate in very urban settings

★ They are connected globally thanks to the Internet

★ Yuppies have a job and receives a lot of money

★ They live in or near a large city

★ They wear designer suits, gucci preferably with slicked back or well cut hair

★ Yuccies use internet as methods of self-promotion

★ They support brands promote sustainable

★ They do not necessarily seek expensive brand names

The whole point of hipsters is that they

avoid labels and being labeled

Psychotype yuppies show marked

narcissistic traits

Main approach of yuccie is being successful like

yuppies and creative like hipsters

9

Men’s Beauty

Market in Ukraine

10

Approximate Market Share of Men’s care beauty products in Ukraine

51% 10%15% 24%

According to the results of market research, it was identified the main players in the market of men's grooming.

Ukraine with a

retail share of 51% has benefits from a wide

product portfolio of well-known popular brands such

as Gillette and Old Spice, which are heavily

advertised on television.

Ukraine ranked second in men's

grooming with a 15% value share thanks to its

popular Nivea brand, which has presence in

many beauty and personal care.

Ukraine ranked third

with a 10% value share due to its

Axe, Rexona and Clear Vita ABE

brands.

Other players of men’s grooming market, e.g. L’oreal Men Expert,

Oriflame, Fa men, Cool men, Welldone and etc.

11

Category Mass Market Professional Luxury

Hair Clear VITA ABE, Nivea Men, Head Shoulders, Axe, L’oreal Elseve, Well-done , Shauma, Shamtu, Estel Professional, Fructis Men

Paul Mitchell, Kerastase, American Crew, Schwarzkopf Professional, Dax men, Murrays, Black&White,Loreal Professional Homme

Acca Kappa, Barex Italiana, Tigi, C:ЕНКО, Korres

Body Arko men, Axe, Dove Men+Care, Nivea men, Palmolive men,Rexona men, Welldone, Old Spice, Adidas, Витэкс, Estel, Fa men, Florena men

Acca Kappa, Declare, Weleda, Mades Cosmetics, Yves Rocher, Kiehls

Lumene Men, Armani Acqua Di Gio, Armani Code, Burberry, Calvin KleinChanel Allure Homme, Clinique Happy for men, Dolce&Gabanna, Davidoff adventureLacoste, Mercedes-Benz

Face Nivea men, Gillette, Cool men,Lumene men, Welldone, Витэкс, Mades Cosmetics, Natura Siberica, L’oreal Men Expert, Arko men, Oriflame, Avon,Faberlic for men, Men Aggressia, Fa men, Florena men

Academie Homme, Biotherm Homme, Phytomer, Declare, Vichy homme, Weleda, Uriage, Yves Rocher, Nuxe men, The Art of Shaving

Collistar, Clinique for men, Shiseido Men, Dior Homme, Lancome Men, Aramis, Paco Rabanne

Fragrance Adidas, Nike for men,Alain Aregon, Avon

Acca Kappa, Acqua di parma, Angel Schlesser, Hugo Boss, Giorgio Armani, Paco Rabanne,Diesel,Chanel Homme, Dior, BVLGARI, Trussardi, DsQuared, Bugatti,

Hermes, Ralph Lauren

Men’s brands in Ukraine

12

PRODUCT CATEGORIES (FACE)

SHAVINGAFTER

SHAVINGSKINCARE

13

What do Ukrainian

Men Need?

14

What are the main characteristics of

selection products for shaving?

Statistical Data from the questionnaires (60 men)

15

Statistical Data from the questionnaires (60 men)The most popular shop for buying men's care products Who buys shaving

16

How often buying products for shavingMen are very conservative in their cosmetics preferences and they often stick with the same products for years

17

Competition in Ukraine

18

MAIN PLAYERS

Manufacturer of accessories for shaving and body care. Each shaving

system has its copyrighted name.

❖ One of the first clearly identified market sector: young, modern, focused on success and winning man.

❖ The pricing strategy is a premium focus.

❖ Gillette spends billions of dollars on ad policies.

❖ Use an Emotional Marketing Strategy.

❖ Managers of the company said that Product Quality is the core product offering, around which everything else revolves.

The world's leading brand in the category of the care of men's skin.

❖ In 1980, men around the world were introduced to a new concept in skincare: an alcohol-free aftershave balm from NIVEA that did not irritate skin.

❖ Offers a wide range assortment: from shaving for sensitive skin to the tonic shower gel.

Is a modern, dynamic, innovative brand.

❖ Brand appeared from 1957 in Turkey.

❖ Under this brand are manufactured shaving, after-shave, razors, deodorants and shower gels.

❖ Positioning the products as consumer goods at an affordable price.

19

of market share

75% The Main Sales of before/after-shaving products are of such brands as Gillette, Nivea Men, Arko, Florena, Avon, Men Expert, Men Agressia, Oriflame, Faberlic, etc..

of sales50%

In the categories structure prevails demand for Shaving Foam, sales of which represent about 50%

The Main Trend in the After-Shave segment is an increase in the consumption of balms and reducing the demand for lotions. BUT lotions are still the most important and the biggest segment.

Aftershave segment is growing much slower than balsam. Low demand persists after shave gels, despite their efficiency in use. Gels occupy the upper-price segment.

20

Main Product AssortmentCategories

Type of the men’s cosmetic/Company Men Expert Nivea men Gillette Arko

Skin Care: 3 2 - -

Hydra energetic Lotion + - - -

Face washing gel + + - -

Cream + + - -

Pre Shaving: 7 14 24 18

Shaving cream - + - +

Shaving foam + + + +

Shaving gel + + + +

Post Shaving: 7 13 16 7

Balm + + + +

Cream + + + +

Lotion + + + +

Gel + - + -

PRICEType of the men’s

cosmetic/Company

Men Expert Nivea Men Gillette Arko

Skin careFace washing gel

50 ml

220UAH

160UAH

- -

Pre ShavingShaving foam

200 ml

70UAH

65UAH

50UAH

35UAH

Post shavingLotion100 ml

156UAH

135UAH

130UAH

65UAH

22

Price\value

Price

Value

23

Distribution Channels

The main players use all retail channels: from open markets to large retail chains.

The main retail channels are supermarkets, specialty shops for the sale of cosmetics and

household chemicals, and large shopping centers.Developing distribution channels such as direct

sales (Avon, Oriflame, Mary Kay) and trade via the Internet (own online shop, online shop).

24

С

Porter’s Five Forces

Threat of new entrants

(high)The market of cosmetic is one of the fastest growing and dynamic,

threat of new entrants in Ukraine is high.

Competitive Rivalry (high)

There is strong competition between certain brands such as Nivea,

Gillette, Argo etc. Any new cosmetics brand entering the market has a low

barriers to entry, however has to face competition from several brands, which vary greatly depending on

multiple factors

Threat of Substitute Products

(low)The suppliers of cosmetic products and cosmeceuticals for Ukraine are

international distributors of cosmetic brands, large global retailers or

individual local agents.

The Bargaining Power of Buyers

(high)In the cosmetic industry, we can

differentiate between two types of buyers: B2B clients and B2C clients.

The Bargaining Power of Suppliers

(high)This conclusion has been made due

to the fact that a substitute for cosmetics products does not exist.

26

DIGITAL MARKET

Part II

27

Digital MarketingActivities with the greatest commercial impact in 2016

- Marketing Automation (including CRM, behavioural Email marketing and web personalization)

- Content marketing - Big Data (including market and customer insight and predictive

analytics)- Mobile marketing (Mobile advertising, site development and apps)- Virtual Reality- Conversion rate optimisation (CRO) / Improving website experience - Social Media Marketing including Social CRM and Social Customer

Care- Search Engine Optimisation - Wearables (e.g. Apple Watch, activity trackers, augmented reality) - Paid search marketing, e.g. Google AdWords Pay Per Click- Online PR (including influencer outreach) - Internet of Things (IoT) marketing applications

28

Digital Trends 1

Improved people-based marketing options will give advertisers flexibility and control

2Advertisers shift focus from workflow efficiency to targeting precision

3Marketers will raise technology standards to close the mobile gap

4Limitations of walled gardens will force advertisers and publishers to make tough choices

5With ad blocking as the new normal, better targeting, formats and relevancy become essential

6The race for data drivers bigger and bigger ad tech acquisitions 7

The era of first-party data creates demand for data-driven C-suite roles

8Coalition loyalty programs will open doors to more valuable second-party data

29

Ukrainian Digital Market

30

Men’sinterests

Waste no more time arguing about what a good man should be.

Be one.Marcus Aurelius

The great question that has never been answered and which

I have not yet been able to answer, despite my 30 years of

research into the feminine soul, is: ‘What does a woman want?’

Sigmund Freud

Sports don’t build character.

They reveal it.

Michael Jordan

I know a lot about cars, man. I can look at any

car's headlights and tell you exactly which way

it's coming.Mitch Hedberg

I don’t have dreams, I have goals.

Harvey Specter

31

brand community in Ukrainian Facebook № 1

Every 20th Ukrainian Facebook

user is a fan of

Chernigivske page.

from 20% in 2013

till 41% in 2014

- Teaser ads - Apps

“Yes, I am Ukrainian” “Chernigivske rules of communication”

- Karaoke-app “Ukrainian songs”

32

Integrated Digital Campaign for Lvivske beer

song / uploaded photos

10 / 1944

22136unique users

43%viral effect

204 544

2314

page views

1 milliontotal reach

users attracted fans

91 000viewers

Ukrainian community of cra ters on FB was created to promote the beer “Lvivske Robert Doms”.

33

“Legendary words”

Digital campaign for

Discovery Channel Ukraine

IDEA User passes the test,

gets a result ( 1 of 11 Archetypes)

and recommendation of the most suitable discovery channel’s

content.

PRIZE 4 cameras Go Pro

RESULTSIn 4 weeks more than 450,000 unique visitors

Viral traffic - 87 %(more than 390,00 unique visits)

Viral coefficient - 7 (1 paid user brought 7 free visitors)

The cost of a 5-minute-contact with customer less than -

$0.05! 9,000,000total viralcampaign reach

In 1 month Discovery Channel gained more than

50 New Requests fromUKRAINIAN TV PROVIDERS

IN 3 MONTHS DISCOVERY CHANNELTV RATINGS IN UKRAINE

ROSE ON 15%

Digital Campaigns of Citroen:

Virtual Race “New Citroen C4 Facebook GrandPrix”

+7000New FANS

1 1 800Likes

+ 66 %Market Share

Say “NO” to someone else’s rules-Announce your manifest!

Digital campaign of Nissan Micra from Lego:

- To assembly the Lego model of Nissan

- Video broadcast on the official website of Nissan

- Online competition among visitors

1

2

Test-drive registrations X 9 times.

117% of promo sales plan

Nivea Men Digital Strategy- Ukrainian branded website

- life hacking of personal care- promotional campaign “Success in details”

Gillette Digital Strategy

- digital POS- promotions

“To become a G-man”

130 thousand codes

40 thousand people

every 3rd participant

36

AMBASSADORS & SLOGANSL’oreal Men Expert Gillette NIVEA

FOR MEN ARKO

David Beckham

Roger Federer

Tiger Woods

Jonas Rivanno

Arjun Rampal

Expert at being a man. Fit. Sharp. Cool.

The Best a Man Can Get

The day begins from you!

Pure Shave. Pure pleasure.

Hugh Laurie

Gerard Butler

Ryan Reynolds

Jimmy Bartel

37

SMM (Jan 2016)

L’oreal Men Expert

Gillette NIVEAFOR MEN

ARKO

237

N /A

N/A 1 238 #lorealmenexpert

N/A

2 095 344

N /A

3 273

52 435

4 036 353

429 843 (RU)

N /A 5195 #niveamen

1 226 (UA)

N /A

N /A

N /A

N /A

38

users cannot live a day without the Internet, and 59% are men

devices with Internet

connection

of Ukrainians prefer social networks as a

leisure.

The majority of Ukrainians put in the 1-st place the desire to stay in shape and be healthy.

21,1million

1,8million

35%

45%

Why Do You need Digital?

21,7 h. a week TV 20 h.

VSOnline

The most active users - a youth

EVERY DAY 70%16-25 y.o

ONLY 14% 40-59 y.o

39

Consumer online feedback about L’oreal Men Expert

The responses from http://shop.loreal-paris.ua:

The responses from http://rozetka.com.ua

40

Statistical Data from the questionnaires (60 men)

Using products of L'oreal Men Expert

Knowledge of L’oreal Men Expert

41

E-commerce environment

★ E-commerce in Ukraine is estimated to be worth 2.7 billion euros.

★ About 70% of users are searching information about goods and services online.

★ Only 30% prefer online purchasing, and more than 40% is offline

★ it’s expected that the e-commerce volume will increase rapidly and will grow from 2.7 to 7 billion euros by 2018

42

E-commerce trends in Ukraine

1 2 3More and more small and medium-sized businesses are opening own online shops. Their online assortment increased to 34.6 million of goods and services

SMALL AND MEDIUM-SIZE BUSINESSES

Powerful offline retailers go online. For example, companies such as WOG, Comfy, “Sea of Beer” go online, which is quite unusual for such players

Ukrainians do more shopping online. Shopping in the product category "beauty" grew by 60 percent compared to the previous year

MORE SHOPPING ONLINE

4 5 6Ukrainians are searching the best deals in online shops. Ukrainians realized that they can not only buy goods in retail networks, but also beneficial to make purchases online.

BEST DEAL

Growing influence and share of mobile devices to online sales. The number of visitors from mobile devices increased more than 2.3 fold

MOBILE DEVICES

Growing customer service online. The powerful players with poor service can lose market share, in contrast, the smaller players will catch up to the leaders.

CUSTOMER ONLINE SERVICE

UNUSUAL PLAYERS

43

MEN EXPERT SWOTSTRENGTH WEAKNESSES

➔ Positive reviews from customers;➔ World Recognized and respected

Ambassadors;➔ The brand presents some unique

products;➔ Having the own online shop;

➔ Limited Merchandising;➔ Low Social Media Performance;➔ Absence of the web-site;➔ No integration marketing

communications;➔ Weak content and on-line positioning;➔ Low marketing budget;➔ no SEO and no digital campaigns;

OPPORTUNITIES THREATS

➔ Become the Best Interacting Digital Brand;

➔ Build long lasting relationship with customers;

➔ Attract new buyers, increase sales;➔ Health and beauty branch is growing

rapidly in e-commerce;

➔ High competition in the market;➔ Ukrainian audience will not accept brand,

due to high prices and economic situation nowadays;

➔ Problems with measuring and evaluating efficiency of digital campaigns;

➔ Wrong target audience focus.

Thanks! any questions?

We are SYNERGY TEAM | KNEU

Anna Konovodova anna.konovodova@gmail.comAlina Astapenkoalinaastapenko20@gmail.comZekie Irikhzekie.irikh@gmail.com

to be continued soon...