Sample Paper on Turning around Yue Sai

China’s rapid economic growth and development has seen an increase in disposable income for its citizens. This has in turn increased the Chinese citizens’ desire for more sophisticated products that enhance their beauty and skin care. In the recent years, the Chinese Cosmetics market has attracted a number of companies, both foreign and local such as Procter & Gamble, Estée Lauder, Shiseido, L’Oréal Paris, Unilever and Yue Sai among others. Yue Sai was the first cosmetics brand in China, founded in 1992 by Madam Yue-Sai Kan. The company’s main aim was to create, produce and sell the very best beauty and skincare products to Asian women and to the world in order to become the first global cosmetics brand from China. However, the company has since faced stiff competition and has lost relevance in the Chinese cosmetics market. Hence, the company needs to adopt new marketing strategies in order to regain its position in the Chinese cosmetics market.

Yue Sai needs to reposition itself. The company should adopt lifestyle positioning and this will be communicated to consumers through major television and print advertising campaigns that feature Chinese supermodels and celebrities. Adoption of lifestyle positioning is due to the fact that more Asian women are becoming concerned with their beauty and thus Yue Sai needs to capitalize on their lifestyle in order to make profits. The advantage that lifestyle positioning will have when adopted by Yue Sai is that it will enable consumers to express themselves through identification with the lifestyles that Yue Sai will represent such as skin care and beauty. However, the disadvantage is that Yue Sai will now face direct competition with other companies that have also adopted lifestyle positioning. Since women concentrate on beauty and skin care, Yue Sai should target women as its consumers.

In order to be successful in the Chinese Cosmetics market, Yue Sai should stand as an independent brand. It should not be linked in any way to other brands such as L’Oréal as the companies might have different objectives. For instance, previously, when Yue Sai was linked to L’Oréal, the latter concentrated more on the distribution of its products rather than branding itself as was the objective of Yue Sai. This resulted in Yue Sai losing relevance in the Chinese cosmetics market. The existence of Yue Sai as an independent brand will give it the opportunity, freedom and space to adopt its own marketing strategies. This will enhance its penetration in the Chinese global market and will help attract more consumers. Definitely, Yue Sai will be more successful and will be a big threat to other existing cosmetics companies in China.

In order to achieve its short-term and long-term goals of success and penetrating the Chinese cosmetics market, Yue Sai should lower the prices of its products as compared to those of its close competitors. This will attract more customers to the company leading to profitability. In terms of promotional strategies, Yue Sai should continue with its current TV and press campaigns despite the steady increase in media costs amidst deteriorating sales. This is because TV and press campaigns reach a wide range of consumers who may shift to Yue Sai. Yue Sai should produce quality and unique products that are acceptable in the Chinese market and that follow the stipulated health regulations. In terms of distribution, Yue Sai should select the right channels of distribution based on the market tiers. Besides, Yue Sai should engage in franchising, as this will enhance the creation of stand-alone stores, which will give it the opportunity to attract its own consumers and maximize on profits.