Amore Pacific International Business Strategy Marketing Essay

Amore Pacific International Business Strategy Marketing Essay With low-barriers to entry, the competitive business environment of the cosmetics industry requires companies to secure stable sales channels, and make great marketing efforts to differentiate its products. However, the cosmetics industry is closely related to the fashion industry which is constantly changing and offer potential growth opportunities. Consequently, cosmetic products typically have short product life-cycles because which require mass-customization capabilities and production agility. Personal Care On the other hand, personal care products business is a relatively a mature industry. Also with a low-barrier to entry, the domestic market is currently saturated with competition. In addition, the emergence of large-scale discount stores and new sales networks has called for rapidly changing marketing and distribution channels. Consequently, the domestic personal care products industry is focusing on developing niche markets by differentiating its product as offering higher quality and value. 1.2. Overview of AMOREPACIFIC AMOREPACIFIC Corporation (â€Å"AMOREPACIFIC† or â€Å"the Company†) aims to become a global beauty company with its core businesses in cosmetics and personal care and health products. Founded in 1945 as a Pacific Chemical Company, AMOREPACIFIC Corporation has been involved in beauty products. With the corporate vision of â€Å"The World will know us as the ‘Asian Beauty Creator’,† AMOREPACIFIC seeks to push the boundaries of traditional beauty with innovative solutions drawn from its rich Asian heritage.   [ 1 ]   The Company also stresses the five values: Openness, Innovation, Proximity, Sincerity, and Challenge to openly communicate with its customers and employees, pursue innovative ideas and new concepts, maintain physically and psychologically close to customers, fulfill obligations to society, and be passionate about overcoming challenges.   [ 2 ]    The Company first began its export sales via OEM and also began to sell cosmetics products under its own brand â€Å"AMORE† in 1964. In 1990, the Company turned to international markets by establishing its first overseas subsidiary in France, followed by establishing its Shanghai and Chartres plants in 2002 and 2004, respectively. In 2010, AMOREPACIFIC’s sales reached KRW 2 trillion, with operating profit of KRW 340 billion and net earnings of KRW 285 billion. The Company maintains its number one player in the domestic market with a 34.9% cosmetics market share in 2010. In terms of its overseas operations, the Company has enhanced its sales in 2010 by approximately 11% to KRW 335.8 billion.   [ 3 ]    With its strong domestic position, the Company is targeting sales and operating profit growth of 10% in 2011 by creation of growth markets. For each business segment, the Company’s Cosmetics Division is focusing on securing competitiveness in the Asian markets through reinforcement of R&D activi ties to provide differentiated products and services. For the personal care products business or â€Å"Mass Cosmetics & Sulloc Division,† the Company is intent on strengthening domestic market competency by expansion into high-functional products in major personal care categories. 2. International Business Strategy of AMOREPACIFIC’s Cosmetic Products AMOREPACIFIC aims to be a Global Top 10 cosmetics company.   [ 4 ]   While tapping on matured and developed markets such as North America and Western Europe, AMOREPACIFIC is more focusing on developing countries such as China and other Southeast Asian countries. To overcome the limitations of the market size and increasing level of competition in the domestic market and accomplish economies of scale through market expansion with its own line of competitive products, AMOREPACIFIC, utilizing its number one position in the domestic market, has been looking to develop overseas market with in its efforts to gain presence an d become a successful international player in a very competitive global cosmetics industry environment.