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Digital Marketing Strategies: Lush Handmade Cosmetics

Table of Contents

Part I ............................................................................................................................... 4

Background of Company ......................................................................................... 4

Internal Appraisal of Company ............................................................................... 4

SWOT Analysis ................................................................................................. 4

Porter’s Five Forces Model ............................................................................. 6

Competitor Analysis ................................................................................................ 7

Evaluation of Lush’s Current Marketing Strategies ............................................. 10

Theoretical Analysis of Lush’s Online Presence Strategies.................................. 10

Online Value Proposition ............................................................................... 10

Norman Design Model.................................................................................... 12

POST Framework ........................................................................................... 14

Part II: .......................................................................................................................... 16

Consumer Segmentation of Lush’s Market Segments ........................................... 16

Web Marketing Strategies at Lush ........................................................................ 17

Cultural Elements in Marketing Strategies at Lush .............................................. 18

Electronic Customer Relationship Management Strategies (e-CRM) .................. 18

Theoretical Analysis of Lush’s Marketing Measures ............................................ 19

AIDA Model .................................................................................................... 19


DRIP Model .................................................................................................... 20

5Ms of Advertising .......................................................................................... 21

References .................................................................................................................... 23

Appendices ................................................................................................................... 29
Part I

Background of Company

Lush, brand named as Lush Fresh Handmade Cosmetics is a cosmetic retailer

company which sells skin-care and cosmetic products in its multiple market segments

spread across more than twenty different countries across the globe. The company

was founded by Mark Constantine and Elizabeth Weir, with additional shareholders at

different managerial positions in the company. Lush deals in various bathing,

make-up, and grooming products and sells them to the consumers through its website,

as well as through its number of stores in all its business locations. Currently

headquartered in Poole, situated in Dorset district in the United Kingdom, a unique

attribute of Lush's business strategy is that it deals in only handmade cosmetics and it

refrains from buying manufactured products from other companies, and instead tend

to create their own products using natural ingredients. These ingredients are, in turn,

obtained from herbs and are free from animal testing (Lush, 2018).

Internal Appraisal of Company

SWOT Analysis

Strengths Weaknesses

 Lush cosmetics offer high-quality  Many of Lush stores are located

products with natural and herbal in mall locations. The most of the

scents, which are prepared manually mall-located shops of Lush

without the use of machines. Cosmetics are in the United States,

where the malls are facing huge


 These products are vegan and are
free from chemical additives, thus collapse and are experiencing store

adding to the sustainability of the shutdowns due to lack of consumer

company's operations (Kohl, 2016). visits. This might cause economic

problems for Lush stores located in

American malls (Loeb, 2017; Isidore,

2017).

Opportunities Threats

 The inclination of consumers  Lush competes with prominent

towards sustainability and global cosmetic brands such as The

consumption of natural products has Body Shop, which is regressively

increased in the recent years, and competing with Lush in the natural

thus Lush has a significant cosmetics and skin-care business

opportunity to grow in terms of (Smithers, 2011).

market performance and economic


 The increased competition may
stability (Rapahel, 2017).
pose a barrier to Lush in regard to

consumer engagement and consumer

loyalty due to the presence of

multiple brands in the market. Thus it

has to frequently improvise its

marketing strategies (Pride and

Ferrell, 2016).
Porter’s Five Forces Model

Competitive Rivalry The competitive rivalry for lush is low as

the cosmetic business requires a high

amount of investment and capital, and a

small or medium enterprise cannot pose

as competition to an already established

company such as lush.

Threat of New Entrants The threat of new entrants for lush is low

as establishing in the cosmetic industry is

not easy, and it takes time for customers

to trust a new cosmetic brand in place of

an already established brand (Astbury

and Lux).

Bargaining Power of Suppliers The supplier power for cosmetic industry

across the world is low as there are ample

amount of suppliers who provide the raw

material required. Lush manufactures

fresh handmade cosmetic products, which

requires specific natural ingredients

which are available from certain suppliers

only. Therefore the supplier power for

Lush is high.
Bargaining Power of Buyers The buyer power for lush is high because

there are sufficient amount of choices

available for the buyer to choose from in

the cosmetic industry and increased

market competition. Since cosmetic

products have great substitutes which are

easily accessible in the market at low

cost, customers have the power of forcing

manufacturers for lowering down the

price of cosmetic products (Smithers,

2011).

Threat of Substitution The range of cosmetics and beauty

products manufactured by lush are unique

as they are handmade and are made using

all natural and specific raw ingredients,

hence the threat of substitution for lush is

low(Kim and Mauborgne, 2014).

Competitor Analysis

Criterion Lush The Body Shop Estee Lauder

Headquarters Poole, Dorset (UK) Croydon, UK New York City

Ownership Mark Constantine Natura & Co, Estee Lauder


Brazil Companies

Sales 723 million euros 197 million euros $11.82 billion in

in sales [26% in sales [the first 2017 fiscal year

increase than quarter of 2017]. sales, accounting

previous year] The division was for 5% increase in

(Loeb, 2017). sold to Natura & profits (Estee

Co. by the previous Lauder Companies,

owner L'Oreal by 2017)

the end of first

quarter (L'Oreal

Annual Finance

Report, 2017).

Market Focus Global Expansion Global Global expansion

of Cosmetics Multi-national in 150 nations

Business. Already expansion. The selling over 25

established in more Body Shop is brand products

than 20 nations. present in over (Estee Lauder

3000 locations in Companies, 2018).

66 nations (Forbes,

2017).

Main Business Products offered A green and Wider consumer

Strengths are free from sustainable supply base spread across

animal testing and chain which is the world. Sales

are highly constructed of an figures suggest that


sustainable extensive local it is economically

community more robust in the

network hailing cosmetic industry

from 22 different market.

nations (Shatzman,

2017).

Business Regressive Lack of focus on Comparatively

Shortcomings competition from online marketing more

multiple brands and retailing profit-oriented and

strategies like other not focused on

brands (Hope, consumer

2017). engagement and

satisfaction.

Other Operations The lack of clarity Issues of The company has

Issues on Brexit impact is animal-testing in recently faced

forcing Lush to Chinese markets allegations

expand outside the due to local concerning

UK (Slawson, government laws fabrication of the

2017). (Sheftalovich, test results of its

2017). products (Robin,

2018).
Evaluation of Lush’s Current Marketing Strategies

The most used marketing strategy by Lush is social media marketing. Under the

social media platforms, the Instagram handle of lush contributes the most to the

marketing of the company. As the target audience for lush mostly is the young ladies,

marketing through the Instagram handle is a favourable factor for the company. It has

474k followers including celebrities and models and 1013 posts. The Instagram page

of lush has posted about its recently launched products and the methods and raw

materials used by the company to manufacture cosmetics, which enhances the

transparency of the company and attracts the customers. The page also has images of

celebrities endorsing products of lush which acts as an attraction for the customers

and increases the market value of the company(Lush fresh handmade cosmetics

Instagram, 2018).

Theoretical Analysis of Lush’s Online Presence Strategies

Online Value Proposition

Online value proposition aims at creating the market value of a brand product

using web media and online retailing. The online value proposition of Lush can be

evaluated using the 6Cs Model of Value Proposition, which evaluates the online

marketing strategies based on six criterion. The six Cs stands for,

Content Lush's website offers a complete

description of the available products

along with their prices, followed by a

description of its features using the

engaging written content. This is


followed by an additional description of

the critical ingredients of the product,

thus providing valuable information to

consumers using content (Lush, 2018)

(see Appendix 17).

Customisation Lush’s website offers a wide range of

products personalised and categorised by

the nature of their use. The details of

these products can be accessed through

the same website, thus providing both

flexibility and customisation in online

shopping to consumers (Lush, 2018) (see

Appendix 18).

Community In order to exchange tips and information

through direct contacts, Lush's website

provides a live-chat support system,

which the consumer can access by

clicking on any of the desired products. A

chat option is available at the

right-bottom corner of the site page,

which the visiting consumer can access to

gather product information (Lush, 2018)

(see appendix 19).


Convenience The website displays a helpline number

available 24/7 for the consumers visiting

the site. Lush also provides a smooth

return and refund policy which is

appropriately described on site-page

(Lush, 2018) (see Appendix 20).

Cost Reduction Lush offers premium differentiated

product and quality experience to

consumers. Moreover, it has various

customised benefits for online shoppers.

Thus, the company has no online cost

reduction scheme and is focused only on

high-quality consumer experience (Lush,

2018) (see appendix 22).

Choice Lush’s website visitors can choose secure

online payment methods through debit

and credit cards (see Appendix 21).

Norman Design Model

The Norman Design Model explains three levels of interactive designs through

which a designer can engage the user towards its design’s features and content. The

three levels of design explained by Norman Design Model are,


 Visceral Design

This level offers the users a lasting first impression of the product and attracts the

user towards the features and identity of the design, thus connecting with him/her on

an emotional level. At this level, the user can connect the design or a product featured

in the design with him/herself (Rau, 2017).

 Behavioural Level

An interactive design is able to reflect on the behavioural characteristics of the

users, which allow them to understand the benefits of the product featured in the

design and align their expectation from the product with the product features laid out

by the interactive design (Cooper et al., 2014).

 Reflective Level

At this final stage, the users are able to entirely reflect the product features laid

out by the interactive design and confirm their liking for the product and its features.

This interactive level adjoins the product features and user expectations (Rau, 2017).

In this context, the website content available on the Lush's online shopping store

features various interactive designs and user-engaging features. Firstly, the website

offers a finely customised design wherein all the products are personalised by the

nature of their use and are customised in different sections. To accommodate to the

behavioural aspects of the consumers, the website design of Lush has provided with

an editorial section, whereby the consumers can access to the information concerning

the latest additions to the product-mix at Lush and can also gather information

regarding limited editions products offered by Lush. To help the consumers to reflect

the qualities and features of the products, the site provides details regarding product
ingredients, which help the consumers to attach the product to their emotional and

usage expectations. The site has also connected Lush with social media by allowing

users to access social media pages of the company and connect with the audience at a

broader and more emotional level (Vizard, 2014).

POST Framework

The POST is an acronym for people, objectives, strategy, and technology, which

is a proven framework for developing a social media strategy (Sargeant, and Shang,

2010).

People: Lush has achieved immense success by understanding the customers, their

needs, and choices.

Objectives: Lush has framed effective objectives that assist the brand in gaining

success. With the predefined objectives, they discover the strategies that can help

them gain followers on social media.

Strategy: If the strategy of a company is effective, which means if it focuses on

exchanging values with the supporters, then it aids in providing success on various

social media platforms. Lush focuses on providing a unique experience to their

customers by their offers and rewards, personalised benefits, and discounts, which

helps in creating a strong base on social media.

Technology: Lush uses tactics such as hashtags on Instagram, and word to mouth

influencer marketing for crowdsourcing the content on social media (Aronczyk,

2016).
Part II:

Consumer Segmentation of Lush’s Market Segments

Geographical As discussed in the aforementioned

sections, Lush is a globally expanded

cosmetic brand with business stores in

various nations. However, its store

locations comprise of urban areas or mall

locations, implying that it is focused on

the high-profile geographical areas in its

segmentation (Saltzman, 2017).

Demographic The cosmetic products of Lush are

targeted at a young audience. This can be

inferred from its recent consumer

engagement campaigns at youth-driven

social media platforms such as Instagram.

Behavioural The modern-day consumer tends to visit

those online stores which offer all the

details and information on its products

and help the consumer understand its

features through interactive content. In

this context, Lush has generated a

substantial consumer base through its

interactive design content on online


marketing platforms (Kreuser, 2016).

Psychographic The online marketing strategies of Lush

cosmetics highlights the natural and

herbal qualities of its products. This

accommodates to the consumers’ habits

of using sustainable products over

synthesised beauty products

(Brown-West, 2018).

Web Marketing Strategies at Lush

Under the web marketing strategies of lush, the company has given significant

focus in designing the website of the company attractive, impressive and user-friendly

for the customers. The homepage of the site includes articles relating to the activities

such as bathing and make-up as they are in context with the products manufactured by

the company. The homepage also has interactive features such as the chat option

where customers can inquire about there queries regarding cosmetics and make up

related issues. The website highlights the new offers and discounts provided by the

company along with the new products launched. The site has integrated with it an

online shopping portal which let its customers purchase any product online from

across the globe. The safe and secure payment gateways used are a significant

highlight for the international customers of Lush. The website also has separate tabs

and sections for the products available at Lush stores under different sub-sections

such as hair, body, gifts, spa and bath (Lush Retail Ltd., 2018).
Cultural Elements in Marketing Strategies at Lush

Culture is one of the critical factors that affect the marketing strategies of the

organisations across the world. Culture depicts the way of lifestyle and attributes of a

specific group of people; thus leaves a significant impact on the consumer preferences

concerning the selection of lifestyle and beauty products (Kaur and Chawla, 2016). In

this relation, Lush also considers the cultural factors while formulating marketing

strategies for its different beauty products. Lush is firmly committed to restricting the

testing of its beauty products on animals. It is also involved in ethical sourcing and

uses recycled products in packaging in order to provide maximum benefit to its

customers. The use of organic products has helped Lush in maintaining an excellent

relationship with its customers and understanding their needs effectively (Lush USA,

2017).

Electronic Customer Relationship Management Strategies (e-CRM)

E-CRM strategies comprises or tools and tactics available on the web, such as

e-mails, chat rooms, internet forums, social media platforms, and website features,

which enable the company to connect with their consumers using the internet and

carry out their operations of consumer retailing, sales, and consumer after-servicing

(Schust, 2013).

In this context, Lush has sought two different strategies to effectively

communicate with their consumers and resolve their issues, as well as provide them

with unique shopping and purchasing experience. One of these strategies is Engaging

Copywriting, whereby, Lush uses user-oriented content, puns, phrases, and metaphors

written in colourful and aesthetic designs to explain the features of their products.

Moreover, with every product description, the company provides the service of the
chatroom, whereby the users can engage with the company's consumer service

officials and solve their queries. The second strategy is the influencer marketing

whereby Lush uses word-of-mouth marketing. In this strategy, the company uses the

celebrity artists like Zoella and Tanya Bur to promote its products on their v-logs

channels on YouTube and engage and interact with consumers through such

influencers (Griffin, 2016).

Theoretical Analysis of Lush’s Marketing Measures

AIDA Model

The AIDA model describes the process of the first contact of the customer with

the product to the purchase decision (Lamb, Hair and McDaniel, 2011).

Attention: The first ‘A' stands for attention, which means that when a customer gets

aware of the product, it arouse attention. Lush cosmetics arouse attention using its

responsive platforms, the Lush time's consumer magazine and the Lush kitchen.

Interest: After attention is captured, the customer or the consumer becomes willing to

access the website, enter the store, or find the products. The brand identity that is

developed by the personality of the salesperson, and the visual element, generate

interest in the customers.

Desire: The third step proposed in this model for influencing the buying decision of

the customers is Desire. The well-structured website of the brand, easy navigation,

and friendly staff in the physical stores contribute to creating a holistic experience,

which creates a desire to purchase the products.


Action: The feel-good experience allows the customer to affiliate themselves with the

brand (O'guinn et al., 2014). The smell, packaging, and quality of the test product of

Lush make the customer purchase them finally.

DRIP Model

DRIP is one of the useful marketing communication planning tools that is used to

set broad communication goals. It can be used while launching a new product or

repositioning an existing product. DRIP stands for Differentiate, Reinforce, Inform

and Persuade (Tasso, 2017). In the context of Lush, the marketing communication

strategies have been explained with the help of DRIP.

Differentiate: Lush offers fresh personal care and cosmetic products and do not test

its products on animals, which differentiate its product from rivals. It also uses

organic ingredients in its products and customises them as per the customer demands

(LUSH USA, 2017). Lush also do not believe in aggressive advertising and marketing,

and relies on word-of-mouth publicity, and communicate with customers through its

products.

Reinforce: In order to deliver its brand message effectively to customers, Lush has

created a Lush community for its customers. Lush also delivers its brand message

through its newsletters and emails.

Inform: Lush increases brand awareness for its products among customers, Lush uses

Cialdini's principle of reciprocity (Hobbs, 2017). Lush's in-store employees offer

numerous product samples to its customers so that they can try those products. These
store employees also provide customers' valuable information concerning Lush

products.

Persuade: In order to persuade the positive purchase behaviour of customers, Lush

organise different events such as "Fresh From the Past" where its customers are

encouraged to vote for favourite discontinued products and buy them.

5Ms of Advertising

Mission The mission of Lush Cosmetics is to

provide "ultimate consumer

experience". In order to achieve this goal,

the company has moved towards

technological innovation and has

developed an Android-based mobile

application for its staff, which they can

use to provide visualised information of

products available in store, using

influential graphical representations

(Vizard, 2018).

Money Lush has used social media marketing,

content influencer marketing, and

communicative word-to-mouth marketing

of their products and has differentiated

their marketing practices by not spending

on TV commercials and celebrity


endorsements. This has allowed the

company to decrease its marketing

budget (Jones and Manktelow, 2017).

Message The message of Lush's online marketing

strategy is to promote natural, handmade,

and herbal cosmetics products, which are

free from animal-testing and are,

therefore, highly sustainable.

Media As discussed above, Lush has used

Instagram and YouTube as their medium

for online marketing and consumer

relationship management.

Measurement This strategy has led Lush to engage a

substantial consumer base and a 26%

increase in its sales, without spending

unnecessary capital on commercial and

television marketing (Jones and

Manktelow, 2017).
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Appendices

Appendix 1:

Lush. Our Fresh Handmade Story. 2018

Appendix 2:
Kohl (2016). Becoming a Sustainable Organization: A Project and Portfolio

Management Approach

Appendix 3:
Loeb, W. 2017. Forbes.

Appendix 4:

Isidore, C. 2017. CNN Money

Appendix 5:
Raphael, R. 2017. Fast Company

Appendix 6:
Pride and Ferrell. 2016.

Appendix 7:
Slawson, N. 2017. The Guardian

Appendix 8:

Saltzman, S. 2017. Fashionista


Appendix 9:

L’Oreal Finance Report 2017.

Appendix 10:

Forbes. 2017

Appendix 11:
Shatzman, C. 2017. Forbes.

Appendix 12:

Sheftalovich, Z. 2017. CHOICE Australia.

Appendix 13:
Hope, K. 2017. BBC

Appendix 14:

Estee Lauder Companies. Sales. 2017

Appendix 15:
Estee Lauder Companies. Who We Are. 2018

Appendix 16:
Robin, M. 2018. Allure.

Appendix 18:

Lush. www.lush.com 2018. (OVP Content)

Appendix 18:
Lush. www.lush.com 2018 (OVP Customisation)

Appendix 19:
Lush. 2018 (OVP Community)

Appendix 20:
Lush. Return and Refund Policy (OVP Convenience)

Appendix 21:

Lush Secure Pay (OVP Choice)

Appendix 22:
Lush. 2018. (OVP Cost Reduction)

Appendix 23:
Cooper et al. 2014

Appendix 24:
Vizard, S. 2014.

Appendix 25:
Rau (2017)

Appendix 26:
Brwon-West. 2018. Forbes.

Appendix 27:
Kreuser, A.P. 2016. Inc.

Appendix 28:

Lush (@lushuk): Instagram

Appendix 29:
Griffin, Z. 2016. Get Rich Vlogging - Zoella Did It. Alfie Did It. Now You Can Do It

Appendix 30:

Kaur and Chawla (2016)

Appendix 31:
Lush USA. 2018

Appendix 32:

Vizard, S. 2018. Marketing Week.

Appendix 33:
Jones and Maktelow. 2017. CMO

Appendices 34:

Hobbs, T.

Appendix 35:

Tasso, K. 2017.

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