topic a company that is facing a major crisis or public relations issue cocoon

Established in 2013, Cocoon Vietnam is a well-known vegan cosmetics business that isrenowned for its soft and natural products.. Additionally, they make use of organic components includi

Group Assignment

MGT103

Instructor: Trần Đình Thành

Semester: Summer 2023

PREPARE BY: GROUP 4

1 Phạm Trọng Nghĩa _ SS180883

2 Dương Gia Hân SS180726

3 Nguyễn Quốc Khánh SS181085

4 Nghiêm Thị Hồng Nhạn _ SS181104

5 Phạm Nguyễn Thanh Như _ SS181310

Topic: A company that is facing a major crisis or public relations issue

Table of Contents

Introduction 3

Analysis 4

Internal Environment 4

External Environment 4

SWOT analysis 5

Analysis about the problem 8

Recommendations 11

Evaluating 12

Conclusion 13

Reference 14

Introduction

Established in 2013, Cocoon Vietnam is a well-known vegan cosmetics business that is renowned for its soft and natural products It is registered with The Vegan Society, a venerable global nonprofit education organization that offers advice and information on a range of vegan-related topics The business TNHH Nature Story Cosmetic-Vietnam is the parent of Cocoon With all-natural ingredients obtained from different locales, such as Dak Lak coffee, Ben Tre coconut, Tien Giang cocoa butter, and Cao Bang flowers, each Cocoon product embodies the essence of Vietnam Additionally, they make use of organic components including winter melon, Sachi, pennywort, grapefruit, and more

The success of Cocoon is due to its compelling tale as well as its unwavering dedication to producing high-quality products, adhering to the CGMP standards established by the Ministry of Health, and being open and honest with its information

Commitments:

● 100% clear origin of ingredients: All the ingredients used in their products have documentation proving their origin (Certificate of Analysis - C.O.A) from distinctive

suppliers in Vietnam and supplementary active ingredients and vitamins from Japan,

France, the Netherlands, and South Korea

● 100% vegan cosmetics: They do not use ingredients of animal origin commonly found in cosmetics, such as honey, beeswax, lanolin, sheep's wool fat, sheep placenta, snail slime, shark liver oil, silk, etc

● 100% never tested on animals: Cocoon's cosmetic formulas are researched and tested through in vitro tests or on volunteers (in vivo tests) They do not conduct any tests on

animals like rabbits, mice, or fertilized chicken eggs.

However, on May 28th, word spread quickly on social media about Cocoon Vietnam's makeup remover containing an unknown object that was possibly a worm Not long after, on May 29th, the vegan makeup company promptly offered a fix The makeup removal product with a rose aroma is now limited to distribution centers To retrieve the merchandise from the shelves for examination, the business has made contact with these distributors To keep defective goods from getting to customers, they will be recalled to the factory if any anomalies are discovered

Analysis

Internal Environment

Cocoon has fostered a workplace environment centered around innovation, creativity, and excellence, which has been instrumental in the development of its distinctive products that effectively cater to customer needs The company's cosmetic offerings encompass a diverse range of products crafted from natural ingredients These items not only align with the preferences of environmentally conscious consumers but also adhere to cruelty-free, vegan, and eco-friendly principles Additionally, Cocoon boasts a dedicated team comprising talented and seasoned professionals who exhibit a genuine passion for their craft This contributes to a positive and motivated atmosphere within the organization

External Environment

Macro environment

The macro environment of the cosmetic market is influenced by various cultural, social, political, economic, technological, and environmental factors One significant factor is the cultural and social shift towards environmental protection and a desire for natural products Consumers are increasingly conscious of the environment and interested in cosmetics that align with their values, such as those made from sustainable ingredients and packaged in eco-friendly materials

The political factor in the macro environment refers to government regulations imposed on cosmetic companies Governments can enact laws and regulations that govern the use of natural ingredients, restrict the use of harmful substances, or even ban materials that contribute to environmental pollution These regulations aim to ensure the safety of cosmetic products and protect the environment All cosmetic companies have to strictly adhere to all of these regulations

In summary, the macro environment of the cosmetic market is shaped by cultural and social trends towards environmental protection and natural products, as well as government regulations that govern the ingredients and materials used in cosmetics By understanding and adapting to these factors, cosmetic companies can meet consumer demands, comply with regulations, and thrive in the market

Microenvironment

In a large-scale environment, cosmetic ingredient suppliers are conveniently situated, guaranteeing a steady supply for cosmetic companies This approach effectively lessens reliance

on imports and bolsters domestic economic progress The beauty and cosmetic market is one of the most highly competitive markets, it featuring prominent players like L'Oreal, Maybelline, and Shiseido To thrive amidst this competition, companies must diligently ensure that their

offerings align with customer demands for environmentally conscious practices and the use of natural ingredients This entails meeting the needs of consumers who seek products that prioritize environmental protection and possess compositions rooted in nature By catering to these preferences, companies can establish a competitive edge and secure their place in the market

SWOT analysis

Strengths

In the skincare and cosmetics field, Cocoon is a well-known and respected name, distinguished

by its remarkable brand reputation and commitment to employing natural ingredients Cocoon stands out for its dedication to innovation through intensive research and development, which allows the company to launch ground-breaking goods and use cutting-edge technology to stay highly competitive with other cosmetic brands

Cocoon focuses on health-conscious customers by emphasizing the use of safe and natural skincare products, which impress customers and build strong customer loyalty Furthermore, Cocoon builds its brand image quite well on the internet through some social media platforms such as Facebook, Instagram, and TikTok, hence it builds high customer awareness, and customers believe that are cared for and listened to by the brand

Weaknesses

Analyzing Cocoon's weaknesses requires discussing its restricted variety of products The brand's current primary concentration on skincare and cosmetics may limit its potential for expansion and its market reach Furthermore, Cocoon's geographic reach is restricted to

Vietnam, which limits its ability to access global markets and a larger clientele Furthermore, while the brand's dedication to employing sustainable and natural products is commendable, it may raise production costs, which could affect pricing competitiveness and profitability

Opportunities

Cocoon has a significant opportunity to tap into the growing demand for natural and organic products With consumers increasingly seeking clean, sustainable, and natural beauty options, Cocoon can capitalize on this trend by expanding its range of offerings in this segment Diversifying its product portfolio by introducing new lines such as hair care, body care, and oral care aligned with its natural and safe product philosophy presents a valuable chance for growth Furthermore, Cocoon has expanded its geographic presence beyond Vietnam, opening doors to new markets and allowing the brand to increase its customer base internationally Collaborating with other natural and sustainable brands presents another opportunity for Cocoon to enhance its market presence, attract new customers, and strengthen its brand positioning

Lastly, Cocoon can leverage the growing e-commerce market by emphasizing and expanding its online sales channels This strategy can enable Cocoon to reach a wider audience, improve accessibility for customers, and tap into the convenience and popularity of online shopping

Threats

Cocoon, despite its numerous strengths and opportunities, also faces several threats that could impact its success Firstly, the beauty and skincare industry is highly competitive, with a multitude of established and emerging brands offering similar products This intense competition

poses challenges for Cocoon in maintaining its market share and distinguishing itself from competitors

Secondly, economic volatility is a significant threat to Cocoon Fluctuations and downturns in the economy can result in reduced consumer spending on beauty products, leading to decreased demand and sales for Cocoon This vulnerability to economic changes could potentially hinder the company's growth and profitability

Counterfeit products also pose a threat to Cocoon The presence of counterfeit versions of its products not only damages the brand's reputation but also erodes customer trust and loyalty This risk highlights the importance of implementing effective measures to detect and prevent the circulation of counterfeit goods

Furthermore, Cocoon must navigate the challenge of adapting to evolving regulations and changing safety standards in different markets Compliance with these regulations can be complex and time-consuming, potentially impacting the company's product development and international expansion plans

Lastly, changing consumer preferences can pose a threat to Cocoon The emergence of new beauty trends or the increasing demand for sustainable packaging may require the company to adapt its product offerings and marketing strategies to remain relevant and meet evolving customer expectations

In summary, while Cocoon has many strengths and opportunities, it must also be aware of the threats it faces in the highly competitive beauty and skincare industry By proactively addressing these challenges, Cocoon can position itself for long-term success and continued growth

Analysis of the Problem

Cocoon, a reputable cosmetic brand in the Vietnam market, faced a range of opinions from netizens after a mistake occurred in one of their products While some defended the brand, stating that the deep appearance of the rose petals was a result of organic cultivation methods and the flowers not yet blooming, others criticized and even boycotted the brand's products

In response to the incident, Cocoon provided an explanation of their production process and the materials used in their products They highlighted that their roses are cultivated using organic methods, without the use of pesticides or chemical fertilizers The petals are carefully manual-gathering before blooming and undergo a closed freeze-drying process to retain their scent and color The manufacturing plant also adheres to good manufacturing practices and meets all production conditions according to GMP standards

However, despite their explanation, the incident left a negative impression on customers and raised concerns about the management of the Cocoon brand One of the main issues identified was the lack of qualifications and responsibility within the production board Cocoon's organizational structure was found to be lacking a dedicated production and quality control department, which could have prevented such incidents from occurring

Additionally, the senior management was criticized for not closely monitoring each stage of the production process and failing to oversee employee behavior The company's network-oriented organizational structure, while offering advantages, posed difficulties in effectively tracking employee performance Furthermore, Cocoon had not implemented a robust quality control system to ensure that products met specified standards and were produced under appropriate conditions

Despite the shortcomings, Cocoon did take swift action by issuing an explanation and recalling the faulty products However, some felt that the company's explanation was insufficient to convince the public Suggestions were made for Cocoon to provide a video or clip showcasing

their production process, rather than relying solely on images Additionally, clearer recall and compensation documents were recommended to instill greater confidence and satisfaction among customers

Criticism was also directed towards Cocoon's admission of error, which was seen as vague and lacking accountability Many key opinion leaders (KOLs) expressed the need for clear feedback and concrete solutions to address the problem, rather than receiving baseless explanations from the brand

Ultimately, Cocoon managed to mitigate the impact of the incident by taking the time to address the issue and remove any negative publicity However, this approach may have resulted in potential customers feeling deceived once they learned the truth behind the incident, leading to a loss of trust in the brand

Recommendations

To ease the concerns of consumers and journalists Cocoon company has to set accurate and visionary plans and strategies to undergo this reputation crisis Below are some of our recommendations for Cocoon Company to get over this decline

1 Terminate all the sin manufacturings and distributions: Stop connecting with the production and distribution of the products involved in the incident to prevent the further spread of the problem

2 Conduct an evaluation: Investigate the root cause of the issue by inspecting the manufacturing process, materials used, quality control procedures, inspection steps, agency conflict, and may be related to financial fraud This will help identify the source of the problem and prevent it from happening again

3 Gather customer feedback and quickly prepare plans to fix the problems : Encourage customers who have experienced problems with the product to contact the company as soon as possible to gather detailed information about the issue The company should be responsive and provide support to affected customers

4 Product recall or refund: Consider initiating a product recall and offering a replacement or refund to affected customers This will help alleviate customer concerns and show that the company takes responsibility for the issue

5 Upgrade customer connection and social media management: Ensure that the communication and customer service teams are operated by skilled and experienced staff to handle customer inquiries and provide timely responses Apologies and updates can be posted on social media platforms to regain customer trust

6 Long-term prevention measures: All the issues should be implemented measures to prevent similar incidents from occurring in the future This may include stricter testing procedures, quality control measures, employee training, and continuous monitoring and inspection

7 Encourage customer vigilance: Advise customers to inspect products upon receipt and document any issues they notice This will help protect them and provide evidence in case of any problems later on Moreover, this will let Cocoon’s customers know that they were carefully taken care of by the company

8 Strengthen retail presence: Establish physical retail locations where customers can purchase products with confidence, knowing they are genuine and safe

9 KOLs and influencers strongly affect customer insight: Nowadays, customers prefer to have

an overview of the products they are interested in Thus, Cocoon company can invite some