Answer Study Case #1

1. Conduct SWOT analysis for the Body Shop

The Body Shop is a popular brand in health and cosmetics products in

London, United Kingdom. The founder of the company was by Dame Anita Roddick
who is an environmental and human rights activist with her vision was to make an
ethically made beauty products. The Body Shop is a retailer shop that known for
targeting niche market sector for naturally inspired products. Thus, there are several
SWOT analysis that can learn from The Body Shop. SWOT analysis is a process to
identify the strengths, weakness, opportunities and threats of a company. The
benefits of SWOT analysis is to help in positioning the company as to know how well
is the company doing, determine who is the competitors of the company and
determine what action can be taken in order to accomplish the target goal as well as
sustain the growth of the company.

There are several strengths for The Body Shop and one of the top is
positioning or positive image. The Body Shop is known as a product that ethical and
environmental-green products as the ingredients and packaging of the products such
as skin care, hair care, and body care product is using a natural ingredients and
biodegradable packaging. As for that, The Body Shop is a globally recognised and
respected brand as it products is not using any harsh chemical which are
dermatologically safe for all skin types and no animal testing involved in
manufactured and producing the final products. Therefore, Body Shop has a well-
established brand image and equity globally and attract a high level of customer
recognition and loyalty. This unique positioning of The Body Shop is its biggest
strength. Other than that, Body Shop strengths is high level of control. This is
because Body Shop is using its own distribution channels, thus company has full
control over product shelf planning, pricing and promotion. It also benefit to company
as its enable company to communicate directly with the customers. Thus, it is also a
best and effective way in order to collect any feedback and comment from the
consumer and take any correct action to overcome the problem.

Beside strength, there is weakness of Body Shop. The weakness of Body

Shop is limited reach of retail outlets. As mentioned above, Body Shop only focus on
its own distribution channels which is direct selling. Therefore, this can limited the
customer base as the limited reach of the customer. Body Shop cannot reach and
attract its customer that is living far from the store. In addition, pricing of Body Shop
also one of the weakness. As Anita Roddick thought that her consumers would be
willing to pay a higher prices with natural and green products at the early years of the
business. Unfortunately, there are many businesses that have run and introduced
the same business products as Body Shop. Due to that, Body Shop struggled in
maintaining its consumers with its high prices.

Next is opportunity. Opportunity of Body Shop is increase awareness of

organic and eco-friendly products. As we already know, Body Shop is an ethical and
environmental in produce it products. Thus, this can give an opportunity to Body
Shop in attract its customers. Nowadays, as internet todays that creating phobic on
the products that have chemicals ingredients, customers are going natural in most of
their daily wear items. Therefore, this can be a huge advantages to Body Shop as
their products already into natural ingredients based makeup and skincare. Other
than that, Body Shop also have potential to increase sales though other retailers.
This can help in increasing the company’s presence and bring its products to a wider
audience.

The threats in the SWOT analysis of the Body Shop are there is a very stiff
and intense competition in the cosmetic market with a new brand launching itself
every day. There are some companies that selling a natural and green products that
based on customers’ needs and wants. Thus, it may become a serious threat to the
Body Shop. Example of competitors to The Body Shop are nature based brands
such as L’OCCITANE, LUSH, FRESH and so on. Besides, there are also a
competition from low-cost products that also a natural based product such as
pharmacy chains which are Cetaphil, Cerave, Eucerin and so on. All these products
can be find at nearby pharmacy retailer such as Guardian and Watson. Thus, this
can be huge threats to Body Shop as it products seem increasingly expensive.
 SWOT ANALYSIS
Strengths Weaknesses

1. Positioning 1. Niche market

2. Well-known brand 2. Limited reach of retail outlets
3. High level of control 3. Higher in pricing
4. Huge franchise 4. Segmented promotional activity
5. Strong customer community 5. Lack of innovation in growth
6. Well-designed store layout areas
7. Biodegrable packaging 6. Damage to image from L’Oreal
8. Ethical and environmental deal
products 7. Dependents on mature markets

Opportunities Threats

1. Increase awareness of organic 1. Intense competitiveness among

and eco-friendly products
2. Increase sales through other
retailers
3. Developing markets
4. Widen geographic footprint
5. Ethical stance continues to
attract
the new or existing competitors
2. Natural disaster or environment
3. Decreasing demand, economic
slowdown
4. Change in customer preferences
5. Rising costs of raw materials and
commodity prices
6. Cut-price competition
7. Supply uncertainties
2. Was The Body Shop started as a retail business with particular values or as a means of
pursuing an ethical crusade? What do you think?