FACULTY OF BUSINESS AND MANAGEMENT

BACHELOR OF BUSINESS ADMINISTRATION (HONS.) INTERNATIONAL

IBM 641: GLOBAL BUSINESS STRATEGY

GROUP ASSIGNMENT: MAYBELLINE COMPANY

GROUP MEMBERS:

NAME MATRIC NUMBER

NURUL EMEYLIA BINTI RUZAIMI 2021155895

AZYAN FARHANA BINTI ADHAM JAMALULLAIL 2021132389

RUSYDINA ALIAH BINTI MOHAMED FARAISH 2021101635

NUR FARAH SHAHIRA BINTI ZULKERNAIN 2021102565

GROUP:
KBA 246/5D

PREPARED FOR:
MADAM ETTY HARNIZA BINTI HARUN

SUBMISSION DATE:
20 NOVEMBER 2022
EXECUTIVE SUMMARY

Maybelline, a cosmetic brand founded in the United States, is a subsidiary of the French
cosmetics multinational Loreal. Originating in 1912, Maybelline has been in business for nearly a
century. Maybelline New York is the most popular cosmetics brand in the world, with distribution
in over 125 countries and a reputation for combining scientifically superior formulation with trend
insight. The collection of Maybelline New York contains cosmetics for the eyes, face, and lips, as
well as eye brushes, makeup tools, and removers.

Therefore, their mission is to provide innovative, easily accessible, and low-effort cosmetics. Their
vision is to become the leading cosmetics brand in the entire world. Many beauty lovers from
around the world recognize Maybelline as an iconic brand that is widely accessible to American
consumers. Maybelline is a market leader in the cosmetics sector, producing some of the finest
makeup available.

In this report, we aim to analyze the effect of digitalization on the Maybelline New York firm in
Malaysia regarding their rivalry among competitors, threats of new entrants, threat of substitute,
bargaining power of supplier and bargaining power of buyers. Maybelline has a variety of rivals in
the cosmetics market. This is because there are dozens of other cosmetic companies competing
with Maybelline in the cosmetics sector. Some of the competitors are, L'Oréal Paris, Revlon, Estée
Lauder, Clinique, Lancôme and others. Maybelline is primarily a mass-market brand whose goods
are sold at relatively modest pricing. Aside from that, modern technology has been widely used
by businesses and manufacturers of all types.

Consequently, we also evaluate the most effective business strategy for Maybelline and provide
recommendations towards achieving their exceptional success.
 TABLE OF CONTENT

BIL. CONTENT PAGES

1.0 INTRODUCTION

2.0 THE EFFECT OF DIGITALIZATION ON THE FOLLOWING

FORCES:

2.1 RIVALRY AMONG COMPETITORS

2.2 THREAT OF NEW ENTRANTS

2.3 THREAT OF SUBSTITUTE

2.4 BARGAINING POWER OF SUPPLIERS

2.5 BARGAINING POWER OF BUYERS

3.0 THE BEST STRATEGY FOR COMPANY TO REALIZE ITS

BUSINESS GOAL

4.0 RECOMMENDATIONS

5.0 CONCLUSION

6.0 REFERENCES

7.0 APPENDICES
1.0 INTRODUCTION
1.1 BACKGROUND OF THE COMPANY

Maybelline is the leading cosmetics brand in the world and is sold in over 129 countries. It is a
multinational American cosmetic, skin care, fragrance, and personal care corporation
headquartered in New York City. With over 200 products, Maybelline New York combines
technologically advanced formulas with trend-savvy skills to produce cosmetics with a hip, urban
edge and lively flair.

In 1915, Thomas Lyle Williams established the Maybelline cosmetics firm. Thomas' age at that
time was only 19. Maybelline's initial product was a dark eyelash mascara. After witnessing her
sister, the young Thomas was inspired to create this invention. She would apply a mixture of
Vaseline and fine coal dust to her eyelashes in order to make them appear darker and more
pronounced. Thomas successfully created his first product, Lash-in-Brow-Line, by applying a
small amount of chemistry. In honor of his sister, he renamed the company Maybelline. Then he
invented one cosmetic product after another before establishing his business, Maybelline.

Therefore, Maybellinehas gone from being a modest, family-run enterprise to becoming the most
successful cosmetics company in America. The company is known for bringing runway trends
directly to consumers, enabling women to make a statement, experiment with new looks, and
showcase their own unique creativity and individuality.

This company was acquired by Tennessee-based Plough Inc. in 1967. Following the agreement,
the entire organization relocated to Memphis. This company was acquired by Wasserstein Perella
& Co. in the year 1990. When L'Oreal purchased this company in 1996, it relocated to New York
City once again. The company moved its production to Brooklyn in 2000. However, Maybelline
maintains its headquarters in Manhattan, New York City, United States of America. There are two
presidents in the organization. David Greenberg oversees the global division, while Leonardo
Chavez is in charge of the American market.
Maybelline's market share in the cosmetics business is substantial. The company became
Amazon's most popular cosmetics brand in 2018. Its yearly revenue in 2019 was $95 million.
Maybelline products are created in several research centers and factories throughout the globe.
It is owing to L'Oreal's ownership of the corporation. These nations include the Malaysia, United
States, France, Brazil, India, Japan, and China, but are not restricted to them.
2.0 THE EFFECT OF DIGITALIZATION ON THE FOLLOWING FORCES:

2.1 RIVALRY AMONG COMPETITORS

Maybelline is a multinational cosmetic, skin care, fragrance, and personal care company based
in the United States. Although we always hear about the Maybelline brand, Maybelline also has
a lot of competitors in this cosmetics industry. This is because apart from Maybelline, there are
thousands of other cosmetic companies that compete in the cosmetics industry. Some of the
competitors are, L'Oréal Paris, Revlon, Estée Lauder, Clinique, Lancôme, etc. Maybelline is
mainly a large-scale brand that sells its products at more affordable prices. Other than that,
today's technology also has been widely used for all types of companies and products.

Furthermore, even though Maybelline has a lot of competitors globally, Maybelline managed to
rank 15th in the world as one of the most successful cosmetic brands. Maybelline's technology is
more sophisticated than that of other cosmetic brands. For instance, Maybelline's digital
marketing heavily relies on brand promotion and user-generated content on websites, Twitter,
Instagram's IGTV, and YouTube.

Compared to other brands, Maybelline has promoted and advertises its brand through all
available media channels. Moreover, Maybelline effectively promotes its entire product portfolio
through TV commercials, online ads, and print media. While other brands only use a few digital
media and still rely on traditional advertising such as magazine and newspaper ads and broadcast
media, Maybelline has successfully used various types of digital media to make their brand known
to many people of all ages and is steadily climbing the ranks. From this, we can say that
Maybelline has a competitive advantage in terms of digital marketing style because it is just them
that has been used a lot in digital media compared to other cosmetics brands.

After that, for Maybelline’s market in Malaysia, Maybelline Malaysia debuted on TikTok Shop, with
daily live shopping broadcasts. TikTok has evolved into an essential digital market in the
marketing toolbox for keeping the brand top-of-mind and close to the hearts of customers. As the
app has evolved into the primary search engine for Gen Z's search for new trends and content, it
is critical that it remains connected to and relevant to its target audience.
Other than that, Maybelline Malaysia also has made several influencers to promote their products.
To add, what surprised us the most was that Maybelline didn't pay these influencers even a cent,
but they themselves promoted Maybelline products to their followers on social media. This has
proven how good the product that Maybelline has released. For example, there is an influencer
named Sofea who has promoted Maybelline through her social media such as TikTok by doing a
video while putting Maybelline lipstick on her lips.

In the video, she stated that she really likes the lipstick and has already bought all the shades
available in the market. The name of the lipstick is Maybelline Super Stay Vinyl Ink lipstick. After
she posted the video, the demand for the Maybelline Super Stay Vinyl Ink lipstick is increasing.
And this has shown that Maybelline always has a good product and this also has shown that
through digital media, Maybelline has made their product sales increased and always a step
forward than their rivals.

Diagram 1: Picture of an influencer named Sofea trying and promotes Maybelline

SuperStay Vinyl Ink lipstick
 Diagram 2: Picture of an influencer named Sofea showing all shades that available for
Maybelline SuperStay Vinyl Ink lipstick

2.2 THREAT OF NEW ENTRANTS

Threat of new entrants refers to the danger that emerging competitors pose to the existing market
players. It is one of the factors that influences how a market is competitive and determines how
appealing a market is. The significant capital and resource requirements make it difficult to enter
this market. Newcomers would have to abide by the laws and other government policies to stay
in the industry. Both maintaining technical standards and having a well-known international brand
is crucial. Given that Maybelline has operations in over 120 nations, it benefits from attracting
more customers by respecting local customs and also by their high technology that makes them
stand out from the other new entrants.

After that, despite the fact that many other recent entrants to this industry attempt to compete with
Maybelline, they are still unable to match the advanced technology used by Maybelline to produce
more products, more effective products, while also reducing production costs. In addition,
because of the Merchandising Sales Portfolio system from Microsoft Certified Solution Provider
Thinque Systems, which runs on Handheld PCs powered by Microsoft Windows CE, Maybelline
executives now have access to real-time data from the retail environment via Web-based reports.
Because of the Merchandising Sales Portfolio system, Maybelline also has taken a step forward
in terms of technology than the other new entrants which have made Maybelline as one of the top
cosmetics brands in the world. Additionally, Maybelline chose to give its field merchandising
representatives Microsoft Windows® CE-based pen-based computers running the Thinque MSP
Merchandising Sales software from Thinque Systems. The handheld devices can quickly transfer
data to Maybelline's corporate headquarters' Microsoft SQL Server database.

Because of this, Maybelline representatives can quickly and precisely capture data using the
Thinque MSP application on handheld computers running Windows CE. Within hours of the data
being uploaded to the Maybelline headquarters' SQL Server database, managers can access the
data via browser-based reports. Managers can therefore make decisions that are advantageous
to Maybelline and its retail partners because the reports are constantly up to date. Furthermore,
it also takes less time for Maybelline field merchandisers to send information to the main office
after hours. Before this, it used to take 30 to 40 minutes but now it only takes a few seconds.

Finally, the Thinque solution has significantly raised the quality of life for the Maybelline
representatives. The Thinque solution manages the entire SQL Server database management
process, scheduling store visits and automatically uploading and downloading any new
information in addition to the daily collected data. With the advanced technology used by
Maybelline, they can keep growing without being concerned about new competitors or market
entrants. This is also due to Maybelline's use of sophisticated technology, which new competitors
lack. Additionally, it makes their brands and products stand out from the competition even more.
2.3 THREAT OF SUBSTITUTES

The availability of competing offerings is an essential component in Porter's five forces analysis.
According to Porter, a substitute is a good or service that a consumer may choose to acquire
instead of the company's product in order to meet the exact same needs as the product offered
by the company. Concern has been expressed by companies over the possibility of competing
goods or services displacing their own. When competitors or companies operating in other
industries offer products that are more desirable and perhaps more affordable, the risk of
replacement is increased. The buyers are then presented with the option to make an efficient
trade-off between performance and price. Another consideration is the expense involved in
making the changeover using digitalization. When it becomes high, the potential of substitution is
decreased.

One of the possible alternatives to Maybelline is L'Oréal Paris cosmetic products. The effort
required to switch is minimal as well. They may choose an alternative product of comparable or
higher quality and lower cost. Maybelline is the most widely recognised and widely used brand of
cosmetics in the world. If the company can't keep up with the competition in terms of quality and
pricing, it could lose its dominant market position to a rival. In order to maintain its position in the
market, the company must introduce fresh thoughts.

For example: The network of interconnected digital services that encourages teamwork and new
ideas of L'Oréal Paris cosmetic products. The trend toward fully automated factories has shifted
the focus of workers to creative problem solving and the reinvention of existing industries. In order
to better serve consumers and keep track of materials, a digital transformation of a manufacturing
facility demands not only linked processes within the facility, but also a tight connection between
suppliers, customers, and the manufacturing department. L'Oreal's digital transformation concept
was reportedly introduced with the debut of its "Connected Beauty Incubator," as stated in the
Harvard Business Review. The center of expertise COE, which is currently referred to as the
"L'Oréal Technology Incubator," is focused on the research and development of innovative,
technology-enabled cosmetic services and experiences. They came up with the idea of creating
an augmented reality (AR) powered mirror software that would enable users to virtually test on
makeup using their mobile devices.
They also developed a new makeup application tool called Perso, which is powered by artificial
intelligence (AI) and allows for on-demand customization of makeup. Perso is a product that has
been released that gathers and uses real-time data in the process of formulating its products.

Diagram 4: Perso analyzed shades of lipsticks that suits our skin

and recommend their products

Diagram 5: After they analyze, it will recommend the products

2.4 BARGAINING POWER OF SUPPLIERS

Maybelline has manufacturers and suppliers located in a variety of countries throughout the world.
A number of them may be found in countries such as Austria, China, Taiwan, South Korea,
France, India, and many others. Because the suppliers are located in a variety of nations, the
global macroeconomic climate has an impact on the suppliers and, by extension, the organization
as a whole. The vendors may also demand excessively expensive pricing, and their products may
not be of particularly high quality. These circumstances can pose a significant risk to the company.
There is a possibility of stockpiling Maybelline items in order to exert undue influence on the
markets. This is due to the scalable nature of the Maybelline brand's offerings.

It is the responsibility of the corporation to be aware of such wrongdoing and to avoid being
exploited by its suppliers. The fact that the suppliers are aware of the required raw material also
means that there is a possibility of forward integration. However, in order to develop the
appropriate products, this would call for a significant amount of research and development. The
fact that the suppliers are located in different parts of the world presents a second problem which
is it may be challenging to achieve consistency in the materials that are being utilized because of
the widespread distribution of the providers. Therefore, the bargaining power of suppliers is low
due to their high dependence on the company.
2.5 BARGAINING POWER OF BUYERS

Maybelline has had a lot of success with their digital marketing, and as a result, they have been
able to attract younger people who have the potential to become clients. The business is
performing so exceptionally well in this arena that it has outperformed not just its parent firm,
L'Oréal Paris, but also a number of its competitors, including Revlon and Estée Lauder.
Customers have an easy time haggling with Maybelline due to the fact that the brand frequently
gives a variety of enticing discounts and promo codes. This is done in order to keep up with the
times and attract new clients.

The cost of switching to a different provider is relatively low in this sector due to the high number
of other providers. Maybelline has been successful in capturing new audiences on Instagram by
consistently publishing three to four high-quality posts on that platform each day. To meet the
demands of the younger generation in this new era of influencers and the material they produce,
the company has collaborated with Gigi Hadid, who is widely regarded as one of the most
successful models and influencers.In this manner, the bargaining power of buyers is diminished,
and the significance of brand equity is elevated to a position of preeminence.
3.0 THE BEST STRATEGY FOR COMPANY TO REALIZE ITS BUSINESS GOAL BY
GENERIC STRATEGIC PROF. MICHAEL PORTER

The Maybelline Company is a globally recognized brand that excels in niche markets. Maybelline
has found it difficult to retain its market leadership position and expand market share without
making considerable efforts in recent years due to the rising tide of competitors in the industry.
The current state of the commercial world necessitates that Maybelline establish a competitive
advantage over its rivals. Maybelline has established its competitive positioning as a worldwide
brand with a significant presence in all regions of the world on the strength of many major features
that give it a significant advantage over competitors, including the competitor in the majority of
consumer markets.

Building a competitive edge through differentiation is another of the most prevalent generic
strategies used today. Maybelline strives to meet its growth goals by implementing a
differentiation strategy.

DIFFERENTIATION STRATEGY
When pursuing a differentiation strategy, a company aims to differentiate itself from its
competitors by differentiating itself in aspects of the market that are highly valued by customers.
It chooses one or more characteristics that many customers in a sector believe to be essential,
and then positions itself in a way that makes it stand out from the competition to satisfy those
requirements.

The Maybelline Company applies a differentiation strategy known as the creation of a variety of
products, each of which has its own set of distinctive characteristics and qualities. Maybelline's
goal in adopting this approach is to set themselves apart by the integration of innovation and to
respond to the rising health consciousness of their target market. To set itself apart from rivals
and increase the breadth of prospects available in the sector, Maybelline, for instance, has
expanded its product line after examining the shifting preferences of consumers. Maybelline has
amassed a dedicated following thanks to the brand's ability to stand out from the competition
while also offering competitive prices.
The Maybelline Company places a strong emphasis on continuously improving the quality of its
products and features in order to meet the requirements of a wide range of customer groups. The
differentiation is accomplished by an adaptive process of constant improvements and creativity
or invention in the production of products; consequently, the company offers a wide variety of
items for purchase in order to meet the varied requirements of its consumers. For example, the
exclusive look of packaging of the products that can attract consumers to buy it and they will look
like they are wearing high-branded premium products. Other than that, the uniqueness of most
products by Maybelline are they love to apply the concept ‘superstay’ or matte which are a trend
attraction to consumers that prefer waterproof and transfer proof.

Furthermore, Maybelline uses the differentiation generic strategy to position its products in a way
that makes them distinct from the competition. Having established itself as a powerful brand, the
corporation relies on product differentiation to prevent competition. Globally, Maybelline spends
a lot of money on marketing, advertising, and diverse approaches with celebrity endorsement so
that they may differentiate themselves from their competitors.
4.0 RECOMMENDATIONS

When it comes to enhancing the product and advancing the market, a competitive strategy is
crucial. As a result of the existence of strong competitors, consumers tend to evaluate services
extensively in terms of their everyday needs and interests. Therefore, there are few interactions
or tactics that can be suggested for the goal of contributing to improved performance and
accomplishing the Maybelline New York’s vision and mission.

First and foremost, the first strategy that Maybelline can consider in attaining outstanding
performance as a cosmetics company is by expanding the industry. The corporation must
consider the frequency of product launches, such as foundation. The severe competition among
Maybelline's competitors in the business can be advantageous. Effective repositioning in the
market sector might assist the organization in boosting its consumer base. Therefore, the
company can beat its rivals. Maybelline should also consider innovation-based product design
that requires digitalization which helps in creating brands with healthy elements. It will improve
global product quality.

Second, implementing focus strategy by utilizing demographic factors in the strategy for
segmenting the market can be advantageous. It is one of the most important alternatives the
business has. Most Maybelline beauty products are bought by people between the ages of 14
and 24. Furthermore, this psychographic trait can help the company grow its market. People of
that age are thought to set trends in the industry. They could be reached by the Maybelline
company through well-planned marketing campaigns. They can do this on a number of social
media sites, especially ones that are popular with teens.

Last but not least, by producing affordable products from the brand. If Maybelline were to
introduce low-cost cosmetics of improved quality, they would open up a massive market for the
sale of their products. Therefore, Maybelline should release its new products in pricing ranges
that were within reasonable reach for working women of the middle class. The brand's increased
popularity among women can be attributed to the great quality as well as the reasonable prices.
5.0 CONCLUSION

To conclude, Maybelline was one of the first companies in the cosmetics industry to enter the
global market, which provided it with a significant advantage over its competitors. The marketing
strategy employed by the company and its use of demographics figures are advantageous to the
business.

They have proven to be essential components in the process of generating revenues. With their
dependable cosmetic products, Maybelline has established the highest rate of consumer-friendly
relationships. It has developed a distinctive marketing strategy that has allowed them to stand out
from the competition by offering its consumers fresh and inventive items that have also kept their
customers engaged. Maybelline has positioned itself very well in a congested field by utilizing an
effective price strategy and marketing strategies.
7.0 APPENDICES

Diagram 6: The Logo of Maybelline New York

Diagram 7: Thomas Lyle Williams, The first founder of Maybelline