Established in 1995, LUSH is dedicated to making fresh, organic toiletries that provide an ethical alternative to traditional methods of cosmetics production. The organization emphasizes handmade, organic products that use natural ingredients sourced in an ethical manner. LUSH has demonstrated its success, increasing the company’s turnover ten-fold within the last 10 years, culminating in a turnover of £326mm in 2012. There are many ways in which LUSH has capitalized on their market position, foremost being their vibrant brand personality, unique product range, and customer oriented approach to marketing. However, there are further potential marketing strategies that can be considered in order to maintain and even enhance LUSH’s brand. This report will examine LUSH’s critical success factors within the UK, before providing a 3 year marketing strategy in order to continue the growth of the brand, both locally and internationally.
Critical Success Factors
Consumer-Based Brand Equity (CBBE) is fundamental to LUSH’s marketing strategy. The marketing concept, which consists of brand awareness and image, has been successfully utilized by LUSH throughout its short history. Formally introduced as a marketing concept in 1993, CBBE focuses on the consumer’s perception of a brand’s value, rather than a brand value based on tangible assets. A positive CBBE will result in a preferable consumer reaction to the organization’s marketing mix (Keller, 1993). Through its products and brand positioning, LUSH has built a strong brand equity that can assist in capturing and retaining customers whilst providing positive brand reflection.
LUSH has an extensive product portfolio with hundreds of products in their cosmetics line (LUSH.co.uk, 2013). With their large range it is important to introduce new products at regular intervals in order to stimulate sales. This also gives LUSH the opportunity to remove unsuccessful products from their range, while retaining popular products. LUSH has made a wide range of previously popular products available on their online store, allowing for the sale of older products without the special restrictions of their physical stores (LUSH.co.uk, 2013). This also allows LUSH to increase their turnover without further innovation. During seasonal periods, limited edition products are released. Due to the short sales period, these items are more highly sought after, prompting increased sales across these lines. With frequent seasonal sales events, LUSH is provided with the opportunity to boost their revenue through this marketing strategy. Another successful aspect of LUSH’s range is the perceived uniqueness of their products. Each of LUSH’s products are handmade, ensuring that no two products are identical. LUSH has been able to differentiate themselves from their competitors through innovative product lines such as their iconic “Bath Bomb” and “Bubble Bar” ranges. The culmination of both innovation and the hand crafted products provides customers with a more personal experience. This unique aspect of LUSH’s product portfolio caters to the consumer mentality of the brand domain.
Segmentation, Targeting, and Positioning (STP)
Never overlooking its initial aim of making fresh, organic, handmade products, LUSH has always adhered to their mission statement. Through this mission statement, significant brand values have been established. Since their inception, LUSH has been firmly against animal testing, and have only used ingredients supplied by companies with a similar ethos (Prnewswire.com, 2012). Early in 2013, LUSH was awarded the Sunday Times Best Companies Awards for protecting and caring about the environment. (Cheshire Today, 2013). Additionally, LUSH also coordinates a variety of ethical campaigns for animal and environmental rights (Lush.co.uk, 2013). These aspects demonstrate LUSH’s commitment to maintaining the world’s ecosystem, providing them with a strong, eco-friendly corporate identity. This identity allows LUSH to capture a fast-growing segment of the brand domain. One current limitation in the cosmetics market is the lack of trust in
‘organic’ and ‘natural’ labels, with over a quarter of consumers testifying to this (Richmond, 2013). LUSH, through its strong corporate image, provides a transparent, organic range which promotes consumer trust despite this marketing resistance. This transparency in their ethical agenda is seen as an important strategy in obtaining new customers (Wilson, 1998, p. 94). LUSH’s brand personality can be described as organic, fresh, vibrant and fun. (Aaker REFERENCE) This brand personality contrasts with other cosmetics companies that often emphasize beauty and luxury. As more than 80% of adults have green priorities (Richmond, 2013), this differentiation attracts significant interest from consumers. By differentiating their brand position against competitors, LUSH manages to resonate with the organic segment of the cosmetics market, allowing them to successfully target consumers within the brand domain. LUSH’s unique brand position also allows for the addition of customer value.
Interactivity and Internal Marketing
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