1. Why has MKC not been as successful as Avon in penetrating international markets?
Mary Kay and Avon are two similar companies cosmetic of direct selling in USA. But by 1992, international sales of Mary Kay represent only 11% on the $ 1 billion total, in contrast, Avon products derived over 55% of its $3.6 billion retail sales from international markets in 1992.
Why? There are 4 reasons.
The first is the strategy copy, MKC use the marketing strategy, products and communications of the US to different subsidiaries without sufficient local modifications. For example, in Canada, US sales director were allowed to go to Canada to recruit and build sales areas. After 15 years of operation like this, some Canadian consumers perceived MKC as out of date.
The second is wrong pricing. MKC didn’t adjust price of product according to the local market conditions when it penetrated a new market.
The third is autonomy. The system of management is too complex. The managers of subsidiaries make the decisions.
The forth is low brand awareness, MKC didn’t supply adequate resource allocations to develop the brand. They didn’t do a lot of communication in order to meet the objectives of market shares.
2. What criteria should Dandurand use in deciding how to prioritize foreign market entry opportunities?
The company also needs to perform macro analysis of various countries to see which nations are most attractive to enter; Mary Kay has to enter markets where her competitors are already implemented. Mary Kay Cosmetics attracts women who are not only interested in looking glamorous and teaching others on how to take care of their skin, but also those who are interested in being independent, successful, and having their own businesses
The firm is well advised to enter markets where presence of women in workforce, independence is positively... [à continuer]
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