Beauty & Go. Building a global, healthy beauty brand · Three alternatives to tackle challenges...

Beauty & Go. Building a global, healthy beauty brand LEONARD, NICOLE, NIKLAS & SOFIE

LUND CONSULTANCY TEAM

Agenda

!  Analysis

!  Alternatives

!  Recommendation

!  Implementation

!  Risks

!  Conclusion

Lund Consultancy Team

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Analysis Alternatives Recommendation Implementation Risks Conclusion


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How should Beauty & Go formulate a future strategy in order to become a global leader within the health and beauty industry?

Make Beauty & Go a global lifestyle brand by introducing a subscription model, opening concept stores and working with

carefully selected retailers

Main Challenge

Recommendation

A joint venture with big ambitions and strong values


Family companies Innovation

Strong position in respective

market

Combined knowledge to create something

great


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Determined to build a

Global brand

Beauty&Go – the brand at it’s core



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Position The number one global brand for beauty and

health from within

Relationships Long lasting and loyal

CVP Healthy drink with great positive effect on skin

luster and elasticity

Personality Fun, aware, elegant

Innovative High technology

Improve health and mind Inside-out

Expression Luxurious Scientific Colorful

Competencies Nutrition knowledge, beauty knowledge,

heritage, track record

Culture Passionate

Vibrant Fun and competent

Mission&Vision Creating beauty from within for the world to

enjoy

External

Internal

She is just starting to be aware of her age and determined to find an good way to stay healthy



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Age: 25+

Gender: Primarily Women

Lifestyle: Active and aware

Social status: When in state of mind to think of beauty

Location: Primarily Urban

The market of beauty from within is at early stage and growing



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Early adapters

Early majority

Late majority

Laggers

$4.6 Bn 2011

$7.2 Bn 2020

World segments are different but all promising



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ASIA

-  Big interest for product

-  Huge market potential

-  High Willingness-to-pay

-  trust in European brands

Europe

-  Some brand awareness

-  Knowledge of founding companies

-  Market knowledge

-  Distribution presence

North America

-  Complex and higher competition

-  Big potential for high-end

-  Low brand awareness

-  Health trend

A carefully defined brand in order to take the new industry in to the future



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For whom (Ideal customer)

Proven by (competencies)

In the business of (market defined)

Promise (Needs satisfied)

The conscious, urban living women with an aim to stay healthy and beautiful

Beauty from within (Nutriosmetics)

Effect full, tasty, proven way to stay healthy and beautiful naturally

A match of competencies, family values, science

Brand core and channel solution



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Food stores

Premium food

Health and beauty

Spa and gym

International

Internet

Huge

Huge

Small

Medium

Small

Unlimited

Size Channel

Health

Beauty

High quality

Concept stores

Luxurious

Brand Core



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Main Challenge

Three alternatives to tackle challenges



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Gain sales volume by lowering prices using food stores 1

Focus on e-commerce and work only with high-end retailers 2

Introduce a subscription model while opening concept stores 3

Alternative 1, focus on quantity



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-  Be available everywhere to everyone -  Gain revenue by low margin and high quantity

-  Move away from the image as a luxurious alternative

Alternative 2, build a luxury brand



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-  Quick delivery of all products via internet -  Available at luxurious retailers such as Health & Beauty retailers and beauty

saloons -  Increase image as an luxurious alternative

Alternative 3, focus on capturing and retaining customers



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-  Offer various types of subscription services of products -  Focus on increasing brand awareness by opening up concept stores, and some

carefully selected retailers -  Focus on making Beauty&Go a part of every day life

Four critical factors for long term success



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Brand Identity - Is the alternative in line with the company’s core values?

Customer demand - Is the alternative meeting the customer demand?

Customer loyalty - Is the alternative promoting customer loyalty and retention?

Feasability - Is the alternative manageable and financially viable?

Alternative 3 is the most favorable



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Brand Identity

Customer demand

Customer loyalty

Feasability

NO

SEMI

SEMI

YES

SEMI

YES

NO

YES

Gain sales volume by lowering prices using food stores

Focus on e-commerce and work only with high-end retailers

Introduce a subscription model while opening concept stores

YES

YES

YES

YES



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Recommendation

Implementation overview



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YEAR 1

-  Internal communication

-  Market research -  Development of

sales strategy -  Location search

YEAR 2-3 -  Global roll-out

-  Selected cities -  Owned events -  Product

development

YEAR 4-5

-  Global extension of sales strategy

-  Re-occurring events

-  Beauty & Go community

The key pillars of the implementation



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Beauty & Go

Sales Strategy Building the

Beauty & Go brand

Online subscription

Concept stores

Airports and retailers

Events

Ambassadors

LAUNCH PLAN

Find and connect with the right consumers, through the right channels



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Concept stores

Online strategy

Airports & High end retailers

-  Premium locations -  Focus on the experience and building the brand -  In store events -  Beauty bar

-  High traffic -  On-the-go consumption -  Meet the target group -  Focus on sales

-  Online subscription with a geographic focus -  “Part of your everyday routine”, convenience, customization

-  5 packages -  Weekly -  Monthly -  Yearly -  Try-outs -  “Create your own”

Going from being a beverage lover to a brand lover. The golden circles



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Our People -  Employees -  Endorser

Our Culture -  Owned events

-  Health camp

-  Yoga events -  Competition

-  Endorsed events

Brand Ambassadors with genuine love and passion Brand credibility and relevance

The global Beauty & Go launch plan and marketing actions



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Europe Madrid, Paris, London,

Stockholm, Copenhagen, Hamburg, Rom, Brussels

Asia Tokyo, Hong Kong, Shanghai,

Taipei, Bangkok, Seoul, Ho Chi Minh

USA New York, Los Angeles,

Miami, Las Vegas, Boston, Chicago, San Fransisco

-  Online marketing -  Social media

campaign -  Airport campaign

-  Event -  Sampling

-  New product campaigns

-  Seasonal -  Theme based

-  Promotional build-up -  Press-release -  Competition

-  LAUNCH: Daytime event -  Yoga event -  Health lunch -  Beauty treatments -  Lessons -  Sampling

Launch cities Continuous marketing Launch strategy

How will the implementation strategy be measured and evaluated?



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!  Brand Recognition ! Customer retention ! New customers !  Increase in sales

30M in revenues ! Online ! Offline

! Market expansion !  Event success

Balanced Scorecard

Overview timeline



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2016! 2017! 2018! 2019! 2020!Sales Strategy!

Online subscription!Development!Roll out!

Concept stores!Design!Location!Roll out!

Airports and retailers!

Research!Negotiations!Roll out!

Building the brand!Ambassadors!

Employees!Endorsers!

Events!Planning!Execution!

Assumptions for future success



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Assumptions:

•  Capacity to invest exists

•  First mover advantage still gives opportunity to take market share

•  New markets, focus on: Asia, Europe, U.S.

•  International growth and online focus

High revenue potential in 3 years time



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Channels!Current revenue! Sales potential 3 years time! Market change!

Retail by distribution! 3,173,625! 20%! Selected retailers!

Health and beauty! 2,163,200! 50%! New concept stores!

International distribution! 1,797,120! 70%! Airlines and flagship stores!

Online! 612,040! 50%! New website with subscription!

Split of types of subscription in euros



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Type of product!Price in

euros! Weekly! Monthly! Yearly! Try outs!Create your

own!

Traditional! 2.99! 17.94! 71.76! 861.12! 11.96! 17.94!

Shot & Seasonal! 3.99! 3.99! 15.96! 191.52! 3.99! 3.99!

Original price! 21.93! 87.72! 1052.64! 15.95! 21.93!

Price to customers! 19.93! 78.95! 894.744! 14.95! 21.93!

Target the medium scenario in a 3 year time frame



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Channels! High! Low! Medium!

Retailers distribution! 8,487,180! 6,223,932! 6,789,744!

Health & beauty! 13,452,400! 7,398,820! 10,089,300!

International distribution! 12,380,160! 5,447,270! 8,418,509!

Online! 6,059,196! 3,702,842! 5,049,330!

Total! 40,378,936! 22,772,864! 30,346,883!

Reaching the goal of 30M euros

Investing to reach future success



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Promotion costs! 2016! 2017! 2018! 2019! 2020!

Market studies! 125,358! 131,626! 214,427! 216,571! 238,228!

Promotion costs! 707,685! 1,415,370! 1,429,524! 1,443,819! 1,458,257!

Promotion and event! 1,868,457! 6,268,457! 3,176,377! 3,208,141! 3,240,222!

Samples! 130,533! 137,060! 219,295! 221,488! 223,703!

Trademark! 35,641! 37,423! 37,797! 38,175! 38,557!

Web page! 198,867! 1,198,867! 338,074! 341,455! 344,869!

Travel! 85,468! 89,741! 161,535! 163,150! 164,781!

Others! 53,671! 56,355! 90,167! 91,069! 91,980!

Total! 3,207,696! 9,334,899! 5,667,196! 5,723,868! 5,800,598!

Current financial projection



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Euros! 2016! 2017! 2018! 2019! 2020!Retailers distribution! 3173625! 4731480! 5658120! 6303960! 6830460!Health & beauy! 2163200! 4806360! 6726200! 834800! 9700600!International distribution! 1797120! 3953664! 4952064! 5351424! 6249984!Online! 612040! 1530100! 3366220! 5049330! 7573995!

Sales! 7,745,985! 15,021,604! 20,702,604! 25,019,514! 30,355,039!

Cost of sales! 3,816,163! 7,018,018! 9,286,010! 10,953,189! 12,927,376!

Gross margin! 3,929,822! 7,983,586! 11,416,574! 14,066,325! 17,427,664!

EBITDA! 610,569! 2,805,803! 5,626,574! 8,396,973! 10,554,174!Net result! 412,080! 1,937,590! 3,778,015! 5,637,000! 7,098,864!

Our recommendation: Explosive expansion leads to explosive net results



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Euros 2016 2017 2018 2019 2020 Retailers distribution! 3,173,625! 4,731,480! 6,789,744! 8,147,693! 9,777,231!

Health & beauty! 2,163,200! 4,806,360! 10,089,300! 12,107,160! 14,528,592!

International distribution! 1,797,120! 3,953,664! 8,418,509! 10,102,211! 12,122,653!

Online! 612,040! 1,530,100! 5,049,330! 6,059,196! 7,271,035!

Sales! 7,745,985! 15,021,604! 30,346,883! 36,416,259! 43,699,511!

Cost of sales! 3,816,163! 7,018,018! 13,929,015! 16,429,784! 19,391,064!

Gross margin! 3,929,822! 7,983,586! 16,417,868! 19,986,476! 24,308,447!

Promotion costs! 3,207,696! 9,334,899! 5,667,196! 5,723,868! 5,800,598!

EBITDA! 610,569! -1,351,313! 10,750,672! 14,262,608! 18,507,849!

Net result! 412,080! -1,466,018! 7,618,850! 10,067,589! 13,097,792!

Risks are manageable



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Risks

1.  Subscription model not being attractive enough

2.  Concept stores not attracting enough attention

3.  First years marketing campaigns not successful enough

4.  High initial investment costs putting pressure on operations

Mitigation

1.  Extensive marketing about the benefits of drinking Beauty&Go

2.  Increase events in store and invite people with extensive social networks

3.  Revise marketing for coming years in order to fully reach out to customers

4.  Focus long term and brand value

No risk in the highest zone



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Risks

1.  Subscription model not being attractive enough

2.  Concept stores not attracting enough attention

3.  First years marketing campaigns not successful enough

4.  High initial investment costs putting pressure on operations

2 1

4 3

Impact

Probability



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Main Challenge

Recommendation



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Setting up Beauty & Go to be, not only a great product, but a lifestyle choice and brand.

Giving people beauty from within World Wide

Appendix


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Highest future product profitability: The 100 ml Shot



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Split by products! Profitability! Media spending!

Traditional 250ml! 20%! Low!

Upgraded 250ml! 40%! Medium!

Shot 100ml! 80%! High!

A carefully defined brand in order to take the new industry in to the future



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For whom (Ideal customer)

Proven by (competencies)

In the business of (market defined)

Promise (Needs satisfied)

The conscious, urban living women with an aim to stay healthy and beautiful

Beauty from within (Nutriosmetics)

Effect full, tasty, proven way to stay healthy and beautiful naturally

A match of competencies, family values, science

A quick overview of what have happened



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A bold idea

looking for the right partners

R&D with an

excellent outcome

Successful launch in

Spain

May 2014

Successful launch in London

(Selfridges)

Unsuccessful launch Tesco UK

Feb 2015

Current date

Beauty & Go. Building a global, healthy beauty brand · Three alternatives to tackle challenges...

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