BACHELOR OF SPORT SCIENCE AND RECREATION

DIGITAL MARKETING MKT558

INDIVIDUAL ASSIGNMENT 1

WEBSITE/SOCIAL MEDIA: HERMO.MY

NAME : MUHAMAD FAQIH BIN MUHAMAD BAHARUDIN

ID NUMBER : 2023168165

CLASS : SR2414NB

LECTURER : DR. MUHAMAD FAIZAL BIN SAMAT

SUBMISSION DATE

21 / 11 / 2023

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TABLE OF CONTENT

BIL CONTENT M/S

1 INTRODUCTION 3

ONLINE CONSUMER VARIABLES

I. Demographics 4-5
2
II. Behavioural/Psychographics

THE IMPACT OF MACRO-ENVIRONMENT

I. Demographic forces 6-8
3
II. Economic forces
III. Technological forces

4 CONCLUSION 9

5 REFERENCES 10

6 APPENDICES 11

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INTRODUCTION

Hermo is Malaysia's most popular beauty e-commerce site. The company offers an online
marketplace for buying beauty and skincare goods, as well as online access to a wide range of
personal products. Hermo was founded in 2012 by Ian Chua as Chief Executive Officer, Ian
Mok as Chief Operating Officer, and P.S. Chong as President's Vice. The booming online
beauty business in China encouraged the founders. According to them, e-commerce will drive
the future of retail in the region.

Hermo's headquarters are in Johor Bahru, Johor, and it also has an office in Kuala Lumpur.
Hermo has expanded into Singapore and Indonesia. Naruko, Innis free, Nature Republic, Dr.
Morita, Laneige, Yadah, 3CE and Holika, NYX, L'Oréal, and other cheap brands have
cooperated with the company.

Hermo offers a large range of beauty products from many countries, including Korea, Japan,
France, the United States, and many more. They include hundreds of respected brands that
promise high-quality beauty, fitness, and wellness items. Customers can shop online from the
comfort of their own homes via the company's website and mobile application. They can also
get great savings by using Hermo Promo Codes.

Their purpose is to provide gorgeousness directly to clients by offering their favourite beauty
items from around the world. They are committed to making the buying experience pleasurable
and economical by providing the best choice of categories accessible. Hermo is a website where
customers may find bargain items and exchange beauty tips with other customers.

Hermo is a recognised partner and distributor of the brands, ensuring that customers receive
100% genuine goods. Because Hermo is an online beauty shop with no physical stores, they
frequently offer their customers significant discounts to ensure that they only receive full
benefits from the comfort of their own home.

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RELEVANT ONLINE CONSUMER VARIABLES FOR HERMO

Demographics:

Age - People aged 18 until 35 often use Hermo website to shop for their personal care products.

Gender – Targeted for both gender, woman and man.

Occupation - Students, office workers such as banker, manager, and executive can shop online
on Hermo since they have no time to go to the physical stores. The housewife can easily access
Hermo website at home without wasting their time to go out.

Location – Originally based in Malaysia but now Hermo has expended their business to
Indonesia and Singapore. Education – People with higher levels of education are more
knowledgeable about how to access internet and do online shopping compared to people with
lower levels of education.

Marital status - Single and married women and men mostly know about Hermo website since
they recommend Hermo to their friends, family and colleagues.

Behavioural/Psychographics:

Personality traits – Hermo frequently conducts sales on their website to entice customers to
buy more from them and grow sales. Customers typically plan and select the type of product
they want to purchase prior to the day of sale. Customers may come across things that appeal
to them while browsing the website. For example, skincare tailored to your skin type or lipstick
in your preferred shade. This will cause the customer to 'add to cart' the things without much
thought. This is what we call impulsive buying, when a buyer buys a thing on sale at a low
price without thinking about it.

Lifestyle – Many individuals nowadays follow the current fashion, particularly in cosmetics.
Consumers make an attempt to enhance their style as well as their personality in order to stay
on trend. Cosmetics play an important function in enhancing the intrinsic beauty and
physiological attributes of consumers. Men, too, use cosmetics in their daily lives, particularly
various types of body care and scents. The growing demand for cosmetics products has resulted
in the globalisation of the cosmetics market.

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Attitudes – Customers are loyal to a website and its items if they are at ease with it. The client
will prefer Hermo over althea.kr since Hermo is less expensive and the website is more
convenient and familiar to them. The majority of consumers are familiar with the things that
they have always purchased since the beginning. Changing attitudes is exceedingly difficult,
especially when consumers are sceptical of marketers' efforts to persuade them to buy more or
switch brands. According to a study, nine out of ten consumers are fine with brands knowing
more about them in order to have a better online purchasing experience. According to the
report, consumers have more negative feelings as a result of brands' apparent lack of attention.
A quarter of buyers are inclined to purchase from the same brand again. Customers are more
loyal to brands that provide personalised experiences.

Value – Consumers are thinking about the environment these days because it is such an
important element of our lives. It also demonstrates consumer behaviour because the globe
increasingly values the environment in order to support and promote products. Consumer
behaviour is influenced by extrinsic factors such as life stage, career, education, compensation,
and lifestyle. Regardless of age or stage of life, each consumer has a unique set of demands,
preferences, and values. Aside from that, the consumer's current emphasis and the type of
services and products they consume are determined by education, career, economic status,
lifestyle, personality influence, and surroundings. The economic status of a country influences
consumer behaviour, particularly the consumer's purchasing power. For example, consumer
income in poor countries is lower than consumer income in rich countries, resulting in differing
purchasing power.

Interest – Following the global skincare trend, consumers are more interested in international
brands, particularly Korean and Japanese brands such as Klairs, Nature's Republic, Hada Labo,
Innisfree, and Naruko. According to a survey conducted by statista.com in July 2019 with a
total of 7,099 respondents, 39% of Malaysians use Korean beauty skincare products, followed
by 25% who use Japanese skincare products, 15% who use American skincare products, 15%
who use European skin products, 4% who use Singaporean skincare products, and 39% who
use others.

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THE IMPACT OF MACRO-ENVIRONMENT TOWARDS HERMO

Demographic forces

Demographics have an impact on every organisation. This covers age, economic level, level of
education, and geographic location. Hermo identifies its clients based on several
characteristics in order to understand the consumer's product preferences and purchase
behaviour. Hermo will then market to consumers who share comparable qualities. This method
assists Hermo in increasing sales and profits.

Consumer income can have an impact on Hermo sales. Expensive things, for example, tend to
appeal to people with higher incomes more than people with lower incomes. People with lesser
incomes are more price sensitive, therefore they choose reduced products or wait for Hermo to
have a sale on specified products before purchasing them.

Age is another type of variable. Hermo's products are more likely to appeal to consumers
between the ages of 18 and 35. Younger generations are more prone to buy cosmetics and
skincare online. The Gen X, Millennials, and Gen Z generations are responsible for rising
purchasing power and expanding market share. According to the study, 68.14% of Gen X,
Millennials, and Gen Z spend more money on social media than Baby Boomers (31.9%).

Consumer education levels can also influence the type of purchase they make. The higher the
level of education, the greater the household income. Higher income equals greater purchasing
power. For example, a consumer with a higher income would select a higher quality product
with a higher price on Hermo. People with greater incomes are not price picky, but rather brand
and quality discriminating, in contrast to people with lower incomes.

One of the most effective market research strategies is the collection of consumer demographic
data. It can be done over the phone, online, via email, mail, or in person. Hermo uses this
strategy to gather as much information from a consumer as feasible. Hermo will include
demographic questions at the end of the survey. Some businesses will use warranty cards to
obtain consumer information.

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Economic forces

The law of a country and the global economy effect all businesses. Interest rates, tax changes,
economic growth, inflation, and currency rates are all economic issues. greater interest rates
may result in greater product costs, requiring the consumer to pay more for the price of a
product. Higher interest rates increase the cost of money for Hermo to invest in business
expansion.

Inflation can be both advantageous and detrimental to economic recovery. Inflation can raise
the cost of living, doing business, borrowing money, and getting a mortgage. One of the
repercussions of inflation may be that employees seek higher compensation. Inflation can also
cause price increases due to rising production costs such as raw materials and wages. Aside
from that, inflation increases demand for goods since people are willing to pay a greater price
for a product.

Because Hermo imports products from numerous countries, the currency rate is critical to the
company. If the currency falls in value, exports will become less expensive, and Hermo will
profit from increased revenue. The company that imports raw materials, on the other hand, will
have to absorb the high cost of imports. If the currency appreciates, Hermo will have to pay
more for exports, reducing the competitiveness of exporting enterprises. Nonetheless, raw
materials will be cheaper as a result of the appreciation. To summarise, Hermo will benefit the
most from depreciation because it is the largest exporter.

Furthermore, economic expansion benefits both businesses and countries. More earnings for
Hermo mean more capital for the company to invest and hire more personnel. As a result, more
employment will be generated, and employee wages will rise. The customer will have more
purchasing power, which will result in a nation's economic growth increasing. Higher
personnel numbers will also boost a company's productivity. Hermo's business confidence will
improve as he takes on new tasks.

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Technological forces

Technological variables have a significant impact on the macroenvironment because they are
linked to factors that generate new technologies, resulting in new goods and market
opportunities. Hermo's communication has become faster, easier, and less expensive as
technology has advanced. It enables Hermo to go from the local market to the global market.
Hermo's technological forces include security, information availability, and cost.

Customers who make online purchases regard security as an important factor. The customer
feels that Hermo's website can protect consumers' personal data during online or electronic
transactions against an unofficial leak of information. Consumers are willing to visit online
stores and make purchases since they feel comfortable supplying personal information and
credit card payment. Typically, consumers will buy from stores they know and trust or from
brands they recognise. One of the reasons consumers avoid making online purchases is concern
that they may be defrauded by the vendor who would use their personal information for
improper purposes, notably credit card data. According to one study, 70% of internet customers
in the United States are concerned about the misuse of their personal information and the
security of transactions.

The consumer expects Hermo to provide relevant and detailed information on the product.
Hermo delivers accurate product information because consumers cannot touch and feel the
products before purchasing them online. Providing product information can help consumers
shop online without hesitation or fear about the product. For example, the consumer can view
the purchaser's online review. The consumer can check the quality of the products that the
purchaser has reviewed. Review from previous purchasers is seen as crucial in gaining
information that will assist the buyer in making a decision about purchasing a product online,
which will make the consumer more satisfied. Quality information about the product is
regarded as a component of e-satisfaction. The consumer always considers the pricing of the
products when making a decision. Hermo, an online retailer, provides consumers with a wide
range of products from various companies. The consumer anticipates that the goods will be
cheaper online than in physical retailers.

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Customers are more delighted when they can get discounts when they shop online. To acquire
the best price on a product, the consumer might compare pricing on several websites. For
example, the consumer will compare Hermo's prices with those of their competitor, Althea, in
order to obtain the best price for the best quality goods. Finally, pricing may be the primary
driver of customer happiness in online buying.

CONCLUSION

Hermo, the top e-commerce site for beauty in Malaysia, offers an online store for purchasing
products that allows online access to a variety of products. Hermo cannot thrive if the marketing
strategy is based on reaching the entire mass market. The advantage of market segmentation is
that it allows Hermo to target consumers with unique wants and needs. This will benefit Hermo
in the long run since it will allow it to deploy its organisational capital more efficiently and
make better strategic marketing decisions.

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REFERENCES

1) Gangai, K., & Agrawal, R. (2016). The Influence of Personality Traits on

Consumer Impulsive Buying Behaviour. International Journal of Marketing and
Business Communication, 5(1). https://doi.org/10.21863/ijmbc/2016.5.1.027

2) Perner, L. Attitudes. Consumerpsychologist.com. Retrieved 4 November 2020, from

https://www.consumerpsychologist.com/cb_Attitudes.html.

3) STUDY: Nine in 10 Consumers are Comfortable with Brands Knowing More about Them
to Get a Better Online Shopping Experience. Prnewswire.com. (2018). Retrieved
4November 2020, from https://www.prnewswire.com/news-releases/study-nine-in-10-
consumers-are-comfortable-with-brands-knowing-more-about-them-to-get-a-better-online-
shopping-experience-300604759.html.

4) Suttle, R. (2020). The Demographic Variables That Affect a Business. Small Business -
Chron.com. Retrieved 8 November 2020, from
https://smallbusiness.chron.com/demographic-variables-affect-business-24344.html.

5) Understanding of Micro and Macro Factors That Affect Your Business. Mage plaza.
(2020).Retrieved 8 November 2020, from https://www.mageplaza.com/blog/micro-and-
macro-factors-affect-your-business.html#macro-environment-factors.

6) Vasić, N., Kilibarda, M., & Kaurin, T. (2020). The Influence of Online Shopping
Determinants on Customer Satisfaction in the Serbian Market. Jtaer.com. Retrieved
8November 2020, from
http://www.jtaer.com/statistics/download/download.php?co_id=JTA20190206

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APPENDICES

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