Princessa Beauty Products Case Solution

Princessa Beauty Products Case Solution 

Decision Criteria

The Decision criteria for the selection of the options include:

  1. Increase in annual sales by 5 percent
  2. Improve the customer relationship and a number of customers by 10 percent.

Suggested Alternatives

Option 1: Product Development and Price Adjustment

There has been an inflation in the cost of goods sold has been observed in the market. In order to generate profit and acquire the new customer, the company should imply a marketing campaign of the product development and increase the price by 10 percent assuming it will not affect its customer loyalty. The product development requires 15,000 dollars as the investment in order to upgrade the packaging and start customer awareness campaign. The customers will also increase by a substantial number. The Princessa should increase its range for the skin care and hair care products that account for more than 35 percent of the sales. The Sales has been increased by 16.31 percent with return on Investment of approximately 200 percent.

Option 2: Collaboration with Beauty Salon

Princessa can have collaboration with the beauty salons in order to expand the market share of the Princessa beauty products. There are many companies that are actively working with the beauty salons in order to sell their products. Some companies have their beauty salons that encourage the loyalty of the customers. The company has the option to first build the link with the beauty salons then it can think about building its beauty salon that requires huge investment. The cost assumed for the option is 12,000 dollars in order to provide heavy discounts to the beauty salons. The sales are assumed to increase by 13 percent, and the customers will increase by 7 to 8 percent.

Option 3: Website Establishment

With the shift in the technology, most of the people love to shop online especially when it comes to buying beauty products. The virtual world provides a better framework to the customers to select the products according to their needs. The Princessa can establish a website and sale its products online. The option requires 15,000 dollars of investment for the option. The Establishment of the website will require 4 to 5 thousand dollars and the remaining investment is needed for the advertising and maintaining the site. The online selling is account for 1.6 percent of the total sales in the market and is assumed to increase by a substantial amount. The sales are assumed to be increased by 20 percent that will also acquire the new customer extension that will increase the customers by 15 percent.

Recommendation

After careful analysis of each of the option, it is assumed the option three is fitting the decision criteria as it has the potential to not only increase the sales but also increase the number of customers. The establishment of the website will also attract the out of the target market customers that are not assumed as the potential buyers………………………

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Princessa Beauty Products Case Solution
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