marketing strategy project analyzing and proposing solution to improve the marketing strategy of rouge dior couture of christian dior

VIETNAM NATIONAL UNIVERSITY INTERNATIONAL SCHOOL MARKETING STRATEGY PROJECT Analyzing and proposing solution to improve the marketing strategy of Rouge Dior Couture of Christian Dior CLA

VIETNAM NATIONAL UNIVERSITY INTERNATIONAL SCHOOL

MARKETING STRATEGY PROJECT

Analyzing and proposing solution to improve the marketing strategy of Rouge Dior Couture of Christian Dior

CLASS INS304101 - GROUP 7

Lê Đỗ Việt Hùng 20070190@vnu.edu.vn Lê Thanh Giang 20070145@vnu.edu.vn Phạm Khánh Linh 19071413@vnu.edu.vn Nguyễn Đức Toàn 19071087@vnu.edu.vn Hoàng Hữu Vinh 20070800@vnu.edu.vn

Supervisor Dr Nguyễn Tiến Dũng Supervisor’s signature

Course Name Marketing Strategy

Course ID INS3041

Hanoi, May 2023

Table of Content

Chapter 1 Introduction to Christian Dior and the Rouge Dior Couture Product Line 5

1.1 Introduction to Christian Dior 5

1.1.1 Business Scope of Christian Dior 6

1.1.2 Dior's history and development milestones 7

1.2 Overview of Rouge Dior Couture Product Line 8

1.2.1 Product’s Specifications 8

1.3 Business Performance in Recent Years 10

1.3.1 Sales Performance in Recent Years 10

1.3.2 Market Share and Position 10

Chapter 2 Current Analysis of Christian Dior France’s Marketing Strategies and Environment 12

2.2 Customer analysis Marketing Strategy 22

2.2.1 Customer demand and buying behavior 22

2.2.2 Customer assessment on company products and marketing-mix 23

2.3 Industry and Competitor analysis 26

2.3.1 Industry environment (Apply the Five-Force Model by Porter) 26

2.3.1.1 Threat of New Entrants 26

2.3.1.2 Threat of Substitutes 26

2.3.1.3 Bargaining Power of Customers 26

2.3.1.4 Bargaining Power of Suppliers 26

2.3.1.5 Competitive Rivalry 26

2.4 Macro-environment analysis on Christian Dior’ Rouge Dior Couture 33

2.6 The marketing problems 38

2.6.1 Limitation on Marketing Segmentation 38

2.6.2 Limitation on Marketing Positioning 38

2.6.3 Limitation on Marketing Offer 38

2.6.3.1 Limited Product Range 38

2.6.3.2 High Price 38

2.6.4 Limitation on Marketing Communications 38

2.6.4.1 Difficulty Reaching Younger Consumers 38

2.6.4.2 Lack of Emphasis on Sustainability and Eco-friendliness 39

2.6.5 Limitation on Distribution and Sales 39

2.6.5.1 Limited Distribution Channels 39

2.6.5.1 Difficulty Adapting to Changes in Consumer Shopping Behavior 39

2.6.6 Limitation on Marketing Research and Marketing Information System 39

Chapter 3 Solutions for Improving Christian Dior’s France Marketing Strategies and Programs in the Next Period 40

3.1 Solutions on marketing segmentation 40

3.2 Solutions on Marketing Positioning 40

3.3 Solutions on Marketing Offer 41

3.3.1 Product 41

3.3.2 Price 41

3.4 Solutions on Marketing Communications 41

3.5 Solutions on Distribution and Sales 42

3.6 Solutions on Marketing Research and Marketing Information System 42

Table of Contribution 43

References 44

List of Tables

Table 1.1 Revenue by the business group of Dior 11

Table 1.2 Worldwide revenue share of Christian Dior by geographic region of delivery in 2022 12

Table 2.1 Segmentation Table of Rouge Dior Couture 13

Table 2.2 Sales value of the perfumes and cosmetics division of Christian……….22

Table 2.3 Comparison between Major Competitor of Christian Dior ……… … 28

Table 2.4 Marketing Mix of Rouge allure l’extrait Chanel 30

Table 2.6 Marketing Mix of Rouge Hermes 33

Table 2.7 Specifications of Rouge Hermes 33

Table 2.8 The Strengths of Christian Dior in the Cosmetic Industry 37

Table 2.9 The Weaknesses of Christian Dior in the Cosmetic Industry 37

Table 2.10 The Opportunities of Christian Dior in the Cosmetic Industry 38

Table 2.11 The Threats of Christian Dior in the Cosmetic Industry 38

Table of Contribution

Name Student id Contribution Comment (by the leader)

Lê Đỗ Việt Hùng

20070190 100 Responsible for part 2.4, 2.5, 2.6 I provided the guidance, the outline, designed the whole report and tables as well as illustrations, gave comments to others, altered the whole of part Vinh, and immensely helped Giang with her work Citing references, and lastly, redesign almost the whole Powerpoint work

Lê Thanh Giang

20070145 100 In charge of part 2.1, 2.2., 2.3, 2.4, Quickly responded to the leader's comment, never late to the deadline, eager to participate in the report Good work, good attitude

Nguyễn Đức Toàn

19071087 100 In charge of part 3.4, 3.5, 3.6 Print and submit the report Good work and actively responded to every notification in the group chat

Hoàng Hữu Vinh

20070800 90 In charge of the Introduction part yet the member did not demonstrate sufficient diligence in their work, resulting in numerous errors and inferior writing skill that necessitated a complete overhaul by the leader Although he did meet the deadline, he has never heed the leader's feedback Phạm

Khánh Linh

19071413 90 In charge of part 3.1, 3.2, 3.3 Her part still included lots of inferior writing skill and seemingly lack of effort putting into both report and powerpoint work that required further alteration from the leader

Chapter 1 Introduction to Christian Dior and the Rouge Dior Couture Product Line

1.1 Introduction to Christian Dior

1.1.1 Business Scope of Christian Dior

Christian Dior is a luxury fashion brand that offers a wide range of products and services to its customers Its business scope includes the following:

The brand's haute couture collection includes dresses, gowns, suits, and other elegant pieces designed for special occasions

that features more casual and affordable clothing This includes dresses, skirts, pants, blouses, and other items that are sold through the brand's retail stores and online channels

Accessories: Christian Dior offers a wide range of accessories to complement its clothing collections This includes handbags, shoes, sunglasses, scarves, jewelry, and other items that are designed to complete an outfit and add a touch of luxury

Beauty and Fragrances: Christian Dior also has a strong presence in the beauty industry, offering a range of skincare, makeup, and fragrance products Its beauty line includes products for the face, eyes, lips, and nails, as well as fragrances for men and women

tableware, linens, candles, and other luxury items that are designed to enhance the home environment

1.1.2 Dior's history and development milestones

Figure 1 Christian Dior’s History

1.2 Overview of Rouge Dior Couture Product Line 1.2.1 Product’s Specifications

Rouge Dior Couture is a prestigious product line of the Christian Dior, which has been produced by Dior since the 1950s It is a product of Dior's dedication to creating high-quality and luxurious beauty products that are inspired by the fashion house's heritage and timeless elegance

One of the unique features of the Rouge Dior Couture line is its luxurious packaging The lipsticks come in sleek, elegant cases that are adorned with the signature Dior logo and feature a subtle yet eye-catching design This attention to detail extends to the lipsticks themselves, which are crafted using high-quality ingredients to ensure that they glide on smoothly and deliver rich, vibrant color

Rouge Dior Couture

1.2.2.Models

The Rouge Dior Couture range includes a variety of finishes, including matte, satin, metallic, and liquid allowing customers to choose the perfect lipstick for any occasion Whether worn alone or paired with other Dior beauty products, these lipsticks are sure to add a touch of luxury and sophistication to any look

The Rouge Dior Couture range

1.3 Business Performance in Recent Years 1.3.1 Sales Performance in Recent Years

Table 1.1 Revenue by the business group of Dior

(Source: LVMH com, 2023)

The Perfumes & Cosmetics business group recorded revenue growth of 17% in 2022 (10% on an organic basis) Profit from recurring operations was slightly down as a result of a very selective policy of distribution to assert itself in the prestige universe Christian Dior enjoyed a remarkable performance, strengthening its lead

1.3.2 Market Share and Position

In terms of market share, Christian Dior's Perfumes & Cosmetics business group ranks among the top 10 global players in the industry According to a report by Euromonitor International, Christian Dior held a 3.8% share of the global beauty and personal care market in 2020, which includes both luxury and mass-market brands Within the luxury beauty market, Christian Dior is a leading player with a strong market position

In terms of market position, Rouge Dior is positioned as a high-end, luxury beauty brand that offers high-quality, long-lasting lipsticks and other cosmetics products The brand's image is closely tied to the iconic fashion brand Christian Dior, and it is known for its sophisticated and glamorous aesthetic In the Cosmetics category by region, revenues were strongest for the year in Asia (excluding Japan: 35%); followed by Europe (excluding France); then the U.S., France and Japan (beauty packaging com, 2022) However, as previously mentioned, Rouge Dior may struggle to differentiate itself from other luxury beauty brands and appeal to a younger, more diverse audience

Table 1.2 Worldwide revenue share of Christian Dior by geographic region of delivery in 2022

(Source: Statistics, 2022)

Chapter 2 Current Analysis of Christian Dior France’s Marketing Strategies and Environment

2.1 Internal analysis

2.1.1 Segmentation and Targeting

Dior’s products are high quality and high priced Thus Dior's target market is people that are willing to pay at a high price for high-quality products that have a guaranteed and mostly target market is people who have great income Dior’s target market can divide into three segmentation

Table 2.1 Segmentation Table of Rouge Dior Couture

In terms of demographic perspective, Dior targets based on gender, income and occupation and social class Dior is a luxury product producer, so the price of the product will be set on a high price based on the quality of product and brand name Dior customers mostly are professional management level because those jobs can earn higher salaries so the price of Dior products can be accepted

In terms of Psychographic perspective, Dior expects the consumers are middle or higher social class Dior design is a noble direction that meets their preferences and it can match the Dior image They are also more willing to pay for the price Dior also targets consumers based on their lifestyle

In terms of Behavior perspective, Dior knows customers focusing on product quality and sales service Dior product quality has guarantee, if there is any problem with the quality of product the customer can get a one for one exchange

Overall, the Rouge Dior Couture lipstick line is positioned as a premium and luxury product that caters to a discerning and sophisticated customer base The product's segmentation and targeting efforts are focused on customers who value high-quality, luxury, and fashion-forward beauty products

2.1.2 Positioning

Figure 2.1 “Positioning Map of Christian Dior - The Cosmetic Industry”

Christian Dior's positioning strategy in the market is one of luxury, exclusivity, and high-end fashion The brand has established itself as a symbol of sophistication, elegance, and glamor, appealing to a discerning clientele that seeks premium quality products and exceptional customer service.To achieve this positioning, Christian Dior has employed several key strategies:

● Positioning by price: Christian Dior has created a unique style that sets it apart from other luxury fashion brands The brand is known for its bold and innovative designs, which often incorporate intricate details and luxurious materials

● Branding: The brand has invested heavily in creating a strong brand identity, with a distinctive logo and branding that is instantly recognizable The brand has also developed a reputation for quality and excellence, which has helped to build trust with consumers

● Positioning by usage/by user: Christian Dior targets a specific audience of worth individuals who are looking for the best in luxury fashion The brand's marketing efforts are geared towards this audience, with a focus on exclusivity and sophistication Differentiation is essential in the modern marketplace because of the ease with which organizations can either develop new products or source them from third party suppliers who are working with other big brands The increasing use of private brands in the retail sector is one of the best examples of it Christian Dior can differentiate its products in the cosmetic industry based on the quality of the products The differentiation should be based not on the premium-ness of the product but on the high quality features it packs in the current product and service offering.

high-net-2.1.3 Market Offer ● Physical Products

Rouge Dior Couture by Christian Dior is a range of luxury lipsticks that comes in various shades and finishes The lipstick is formulated with high-pigment concentration for a long-lasting and intense color payoff The brand also offers lip balms, lip liners, and lip primers that can be used with the Rouge Dior Couture lipstick

Rouge Dior Couture deploys intense couture color on lips for 16 hours of comfort Infused with naturally derived red peony and pomegranate blossoms, the lipstick is to be spotted for this limited edition with velvet, matte, and satin finishes

Image of Rouge Dior Couture

● Service

Christian Dior offers in-store consultations and makeup services to help customers find their perfect shade and finish of Rouge Dior Couture lipstick The brand also has an online virtual try-on feature that allows customers to see how the lipstick looks on their lips before making a purchase

Official Customer Service Website of Christian Dior

● Prices

The price of Rouge Dior Couture lipstick varies depending on the region and the specific shade and finish According to the website of Christian Dior , the average price of a Rouge Dior Couture lipstick in the United States was around $45.00 (DIOR com, 2023).However, prices may vary depending on the location, retailer, and any promotions or discounts that may be available

2.1.4 Marketing Communication

Communication is an important tool to reach a company's potential customers A correct marketing communication strategy needs to be at place for passing on its message and catering to the demands of the customers Dior has the below marketing communication strategy adopted for brand establishment and recognition

2.1.4.1 Advertisement

Print advertisements in magazines and newspapers greatly increase brand recognition, and media advertisements featuring models wearing the Dior label have a particularly strong impact Given its status as a premium brand, Dior has a market for high-end goods that cater to the wealthy demographic As a result, those who are part of a high class social circle are very careful to dress appropriately for each event

Social media is becoming a potent tool for connecting with customers of various tastes, social classes, and financial levels It's critical to pinpoint the channels on which media

Print Illustration of Rouge Dior Couture

2.1.4.2 Promotional Tools

Digital communication is a crucial instrument for quickly and cheaply reaching a big number of target clients Online readers can now access Dior's digital magazine, which gives them access to the latest fashion trends while they're on the road Additionally, it has a popular Facebook page with a large following

Christian Dior’s Official Instagram Channel 2.1.4.3 Programs

Putting on exhibits to display a company's goods or introduce a new range of goods is an antiquated but still effective strategy for reaching prospective customers These businesses have the opportunity to freely connect with their customers, obtain feedback on their products, and learn about the product lines of their rivals when they show

2.1.4.4 Promotional strategy

According to Dior, the 20% most devoted clients account for around 80% of firm revenue The ideal method for rewarding such devoted clients in our market is through royalty points and prizes This method not only improves the company's reputation in the public eye, but it also encourages compulsive consumer behavior Dior's implemented strategy has been very successful for them

Through their 'Dior Loyalty Program' loyalty program the corporation communicates with clients via email or postal mail It keeps track of each transaction's dollar amount and accrues loyalty points that customers can redeem for other purchases or as a form of payment They even invite their consumers to a pre-launch of their new collection and give them free samples, trinkets, and other gifts in return

2.1.5 Distribution and Sales

2.1.5.1 Distribution channels

Rouge Dior Couture is a luxury cosmetics brand under the umbrella of Dior, a French luxury goods company As such, its distribution channels in France are typically high-end department stores, specialty cosmetics retailers, and Dior-branded retail stores These distribution channels offer customers access to a wide range of Rouge Dior Couture products, including lipsticks, lip balms, and lip glosses

Retail Store of Christian Dior 2.1.5.2 Distribution Terms

From the distribution terms aspect, Rouge Dior Couture products are typically sold through authorized retailers, who have agreed to adhere to Dior's strict distribution policies and brand standards These policies ensure that Rouge Dior Couture products are only sold through reputable retailers who meet the brand's high standards for quality and customer service Additionally, Dior may have specific requirements for retailers in terms of the amount of shelf space allocated to Rouge Dior Couture products, as well as the types of promotional activities that can be used to market them Retailers may also be required to meet certain sales targets in order to continue carrying Rouge Dior Couture products

Overall, the distribution channels and terms for Rouge Dior Couture in France reflect the brand's focus on high-end luxury and its commitment to maintaining its reputation for quality and exclusivity

2.1.5.3 Salesforce

The Salesforce of Dior operates through a multi-channel approach, utilizing both traditional brick-and-mortar stores as well as e-commerce platforms to reach customers The team is responsible for ensuring that customers receive a high level of service and are able to find the products that best meet their needs

Some of the specific roles and responsibilities of the salesforce may include: ● Building relationships with customers and promoting products

● Providing personalized product recommendations and assisting customers with their purchases

● Educating customers on the features and benefits of the product

● Monitoring customer feedback and addressing any concerns or complaints

● Collaborating with other departments within Dior, such as marketing and product development, to ensure that customer needs are being met

● Analyzing sales data to identify trends and opportunities for growth

As a result, The Perfumes & Cosmetics business group recorded revenue growth of 17% in 2021 (10% on an organic basis) (globenewswire.com, 2022) However, profit from recurring

operations was slightly down as a result of a very selective policy of distribution to assert itself in the prestige universe

Table 2.2 Sales value of the perfumes and cosmetics division of Christian Dior worldwide between 2013 and 2021

2.1.5.4 Sales Policy

Dior's sales policy focuses on providing a luxurious and classy experience to their customers This includes providing high-quality products, excellent customer service, and a personalized shopping experience

Dior may use a variety of merchandising strategies to achieve these goals, such as offering exclusive products, providing personalized style consultations, and hosting private events for women its top customers

Dior may also use pricing policies to manage the prices of its products Dior's pricing policy may focus on keeping prices high to create scarcity and create value for their customers In addition, Dior may also use marketing and advertising strategies to promote their brand and attract new customers Dior's sales policies may include online and offline marketing and promotional activities, such as social media advertising, organizing fashion events and advertising in fashion magazines top.

2.2 Customer analysis Marketing Strategy 2.2.1 Customer Demand and Buying Behavior

Whether or not Dior can meet the needs of French consumers who prefer light makeup colors at the age of over 20 and do not use dark makeup colors at the age of 30-40 will depend on their product offerings If Rouge Dior Couture offered a natural, lightweight palette, they could appeal to this segment of the French market However, if their products are predominantly focused on darker makeup colors, they may struggle to meet the needs of consumers who prefer lighter makeup

Buying Behavior

There are several differences between the buying behaviors of customers in France and those in Asian countries that Dior should take into account when developing its marketing strategies: