Sk Ii Executive Summary
EXECUTIVE SUMMARY:
This case examines P&G and whether or not it has the ability and means to make SK-II a global brand. Paul de Cesare, President of Max Factor Japan and GLT member of the beauty care GBU, had to recommend one of three alternatives for a global strategy for the SK-II brand: expand into China, build on the brand’s success in Japan, or introduce SK-II to Europe. In doing so, he also had to keep entry strategies for the different markets in mind, and also the organizational change brought about by O2005. de Cesare should recommend the option of growing the SK-II brand in the Japanese market (where it has only 3% share of the $10B beauty market), and introduce the product into major cities of mainland China.
In deciding upon which market to enter, two factors are important:
1. The individual country factors must be analyzed and compared with the core competencies of the P&G organization.
2. One must understand what the effects of entering new markets will have on the newly created strategic organizational structure of P&G under the O2005 plan
Overview:
• The core competencies of SK-II can be replicated easily in the Asian market (Table 1, Appendix, page 6)
• The European market has different preferences than the Asian market and very different competitive conditions.
• Market share of SK-II is still low in Asia. The promise of success as shown by large growth in Japan, home to Asia’s most sophisticated beauty product consumers, necessitates that the focus should be on this region.
• However, with the new organizational structure of P&G supporting the widespread sale of its successful products, an attempt at entry into the European/ UK market might provide clues of expansion into other Western markets.
SK-II: Sources of Success
• Well researched and developed product, provides the multi-step process desired in the sophisticated beauty product market of Japan
• Service at the counter is strong, leading to customer
This case examines P&G and whether or not it has the ability and means to make SK-II a global brand. Paul de Cesare, President of Max Factor Japan and GLT member of the beauty care GBU, had to recommend one of three alternatives for a global strategy for the SK-II brand: expand into China, build on the brand’s success in Japan, or introduce SK-II to Europe. In doing so, he also had to keep entry strategies for the different markets in mind, and also the organizational change brought about by O2005. de Cesare should recommend the option of growing the SK-II brand in the Japanese market (where it has only 3% share of the $10B beauty market), and introduce the product into major cities of mainland China.
In deciding upon which market to enter, two factors are important:
1. The individual country factors must be analyzed and compared with the core competencies of the P&G organization.
2. One must understand what the effects of entering new markets will have on the newly created strategic organizational structure of P&G under the O2005 plan
Overview:
• The core competencies of SK-II can be replicated easily in the Asian market (Table 1, Appendix, page 6)
• The European market has different preferences than the Asian market and very different competitive conditions.
• Market share of SK-II is still low in Asia. The promise of success as shown by large growth in Japan, home to Asia’s most sophisticated beauty product consumers, necessitates that the focus should be on this region.
• However, with the new organizational structure of P&G supporting the widespread sale of its successful products, an attempt at entry into the European/ UK market might provide clues of expansion into other Western markets.
SK-II: Sources of Success
• Well researched and developed product, provides the multi-step process desired in the sophisticated beauty product market of Japan
• Service at the counter is strong, leading to customer