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MG511 Strategic Marketing
Case Study: Burt’s Bees; ‘Leaving The Hive’
Lecturer: Ms.x Date: 14/12/2010
Group: Seánpaul Walsh Kenneth Kiernan Maeve McQuillan
Contents:
1.0 Case Overview 2
2.0 Analyses 2
2.1 External Analysis 2
2.1.1 Strategic Mapping 2
2.1.2 Competitor Analysis 3
2.1.3 Category Audit 5
2.1.4 Brand Awareness Analysis 6
2.2 Internal Analysis 8
2.2.1 Revenue Growth Analysis 8
2.2.2 CBBE Pyramid 9
2.3 SWOT Analysis 9
3.0 Key Issues 10
4.0 Strategic Alternatives 10
4.1 Strategic Alternative (A); Niche Market 10
4.2 Strategic Alternative (B);
Joint Venture into Mass Market 11
5.0 Strategic Recommendation;
Rebrand-Strengthen Awareness-Enter Mass Market 13
6.0 Case Lessons 15
7.0 Appendices/Bibliography 16
1.0 Case Overview
Burt’s Bees had been growing by over thirty percent over the previous four years. The company
is the Brand leader in the natural personal care category, itself growing by fifteen percent over
the same period. The original vision of Burt’s Bees founder Roxanne Quimby was to ultimately
reach “everyone, everywhere”. The opportunity to grow its brand in the mass market is a
lucrative one for the company. However critics and some customers have commented that
Burt’s Bees was becoming too commercial, losing the authentic elements that has led to its
success.
Also in 2006 John Replogle became CEO of Burt’s Bees and he strongly believed that Burt’s Bees
could bring natural personal care to the forefront of mainstream personal care. Under his
leadership the product range would be changing rapidly, it would still stock the brands classics
and many of these products would continue to carry the brands early symbol; Burt’s bearded
face. However new product lines were about to appear among them a complete line of hair care
products. Replogle believed this was the way in which to break into the mass market. However
still the question remained: how could Burt’s Bees realize Roxanne Quimby’s vision of growing
the brand without distancing itself from the people, values and narratives that made it
successful thus far?
2.0 Analyses
2.1 External Analyses
2.1.1 Strategic Mapping
It is clear from our strategic map that Burt’s Bees are a strong player in terms of brand
awareness in their individual natural market. However as we shift to the right of the map we
can see how brands awareness’s increases and also how the nature of the product changes. It is
important to highlight that all the brands listed at the top and to the right, traditional, are in the
mass market. Therefore it is evident that before any move is made Burt’s bees will need to
strengthen their brand.
2.1.2 Competitor Analysis
Burt’s Bees is in an emerging market, the natural & organic personal care market has a 15%
growth rate in the past year and the growth rate will highly likely to continue in the future. As a
result, the industry has shown huge potential and highly competitive. In fact, NPC is still a niche
market under the personal care industry. Key players in the mainstream personal care sector
have shown interest and started to launch their natural personal care brands. Although some of
them claimed to be natural, but they are widely accepted as pseudo-natural. Despite
the natural elements of the products, Burt’s Bees and other NPC brands are also indirectly
competing with those mass market brands.
There are 6 main competitors in the natural & organic personal care sector:
Brand Distribution Channel Price to Burt's Bees
Product Specialty
Brand Awareness
Trial Usage Revenue (million)
Burt's Bees
Speciality Stores, Health Stores, Drug Stores
Premium Skin & Lip Care
54 26 19 101*
Aveeno Food Stores, Drug Stores, Mass Retailers, Speciality Stores
Similar Skin Care 95 29 19 200
Tom's of Maine
Mass Market Channels, Health Stores, Speciality Stores
Lower Oral & Body Care
39 7 6 50
Kiss My Face
Health Food Stores, Speciality Stores, Website, CVS.com
Higher Sun & Skin Care
N/A N/A N/A 75
Nature's Gate
Health Food Stores, Speciality Stores, Website, CVS.com
Higher Hair Care 15 2 1 30-40
JASON CVS Stores Similar No Specialty 8 3 3 20-25
Avalon Higher No Specialty 34 3 1 40
*Figure from sales in 2003 was $60 million, sales growth rate over 30%, take 60*130%*130%= $101.4 million for 2005.
Tom’s of Maine: Owned by Colgate-Palmolive, estimated sales of $50 million in 2005.
Specialize in oral and body care products, price at slightly low than Burt’s
Bees. Tom’s is number one in the natural oral care with 60% share in US$.
Products sold in specialty stores, health food stores, mass-market channels
such as CVS, Walgreens and Target.
Kiss My Face: Sales over $75 million in 2004, Kiss My Face covers most product categories,
and has two product lines. Original natural personal care products priced
similar to Burt’s Bees and the “certified organic” line is generally higher. Kiss
My Face is launching a new makeup line. It is also the sunscreen and
moisturizer sponsor of US Ski & Snowboard Teams 05-06. Distribution
channel includes health food store, specialty venues, own website, and
CVS.com.
Nature’s Gate: Estimated sales of $30-40 million in 2005, Nature’s Gate was the number one
in natural hair care category. Three lines of products, classic priced similar to
Burt’s Bees and the other two higher. Products are sold through health food
stores, specialty venues, own website and CVS.com.
Jason: Estimated sales of $20-25 million in 2005, JASON offers a broad range of
products priced in line with Burt’s Bees. Want to challenge Burt’s Bees in the
mainstream drug channel, started a partnership with CVS.
Avalon: 2 brands under Avalon, Avalon Organics and Alba Botanica, estimated sales of
$40 million. Alba Botanica is priced similar to Burt’s Bees and Avalon
Organics higher. Owned by the same company of JASON, will be part of the
challenge in the mainstream channel.
Aveeno: Principal pseudo-natural competitor in the mass-market. Estimated sales of
excess $200 million, Aveeno offers a full range of products which are sold in
food, drug, specialty stores and mass retailers. Aveeno will launch a new line
of anti-aging products. Aveeno has a huge brand awareness advantage over
Burt’s Bees.
Other mass market competitors in the personal care industry include Johnson &Johnson’s
Neutrogena (sales $1 billion), Garnier, L’Oreal’s $400 million brand, Herbal Essences, $700
million Procter & Gamble brand. Those brands all have natural element in their products, but
they are currently still classified as pseudo-natural.
2.1.3 Category/Product Range Audit
Burt’s Bees currently offers a large range of natural personal care products including lip, bath,
baby, skin care, and etc. There are some products (e.g. handmade candles which made up half of
their sales in the early years, their most mentioned Bay Rum after shave balm, and some
lipsticks especially the fig colour) have been discontinued due to various reasons. Ingredients
are claimed to be at least 98% natural and proven to be effective before launching. The product
also reflects the highly respect to environment and social responsibility, packaged with recycled
materials. One of the most notable features of Burt’s Bees’ products is the efficacy, which is
always tested and proven to be highly effective. This also refers to the healing effect of eczema
CategoryNPC
Penetration
NPC
Growth
Current
Offering
Competitor
Offering
NPC
Feasibility
Cosmetics 2.2% 18.8% No No No
Feminine Hygiene 2.2% 12.6% No No No
Nail Care 2.6% 7.2% No No No
Fragrances/Aromatherapy 4.3% 14.3% No No Yes
Shaving 5.3% 13.4%No(was
offering)No Yes
Oral Hygiene 9.9% 13.5%No(was
offering)Yes Yes
Deodorant 10.4% 18.3% No No No
Haircare/Colouring 11.5% 17.1% No YesYes(ready to
launch)
Baby Care 13.3% 14.4% Yes Yes N/A
Bath 23.2% 14.0% Yes Yes N/A
Bath/Toilet Soap 23.6% 13.5% Yes Yes N/A
Skin Care 27.4% 13.4% Yes Yes N/A
0%
20%
40%
60%
80%
100%
120%
Brand Awareness June 2006
Dove
Olay
Neutrogena
Herbel Essence
L'Oreal
Chapstick
Blistex
Aveeno
Nivea
Garnier
Aveda
mentioned in customer’s
quotes in exhibit 8 of the
case. Smell is also
another feature that
Burt’s Bees valued
highly compare to
others. They believe that
smell is one of the most
attractive and appealing
feature of personal care
products, that also has
been proven to be a
signature feature of
Burt’s Bees products. An
interesting point made
by their Chief Marketing Officer Indursky, “we don’t ask consumers to help in creating products,
we use them to validate, not create”. However, customer feedback in Exhibit 8 has shown huge
desire with the discontinued products. Which we believe that the decision of discontinue those
products was made without any research. Our table below shows the potential of each of the
category in the personal care market including traditional, pseudo-natural and natural product
categories, including the penetration of each natural product category in the market and its
growth over the past year. The table below combined Burt’s Bees and competitors offerings of
each of those product categories. Burt’s Bees’ current offering only include those have the
highest penetration of natural personal care products (bottom 4), despite the above average
growth rate of them. Looking at other categories, a lot of them have huge potential considering
of the penetration and the growth rate together. That might be a good indicator for future
research and development. However, some of them may not be feasible to the core vision of
natural. For example, cosmetics may not be fully natural considering.
2.1.4 Brand Awareness Analysis
The graph to the left is broken into
three parts, the bar charts in blue
represent traditional personal
care products. The green charts
are both natural and Pseudo-
natural products and finally the
yellow represents Burt’s Bees. We
have included both natural and
traditional products into the
analysis as we felt it was
important to consider both aspects
of the market due to the
opportunities of expanding into
the mass market. As we can see
Burt’s Bees has only 54% brand
awareness in comparison to Dove
0%
10%
20%
30%
40%
50%
60%
70%
80%
Trial-June 2006
Dove
Olay
Neutrogena
Herbal essence
L'Oreal
Chapstick
Blistex
Aveeno
Nivea
Garnier
Aveda
Burt's Bees
and Olay who have the highest at 99% each. If we look even closer we can see that the leading
natural product brand is Aveda at 63% while in the Pseudo-natural range Aveeno is a clear
leader at 94%. A possibility for Burt’s Bees only coming in at 54% could be down to the fact that
they do not rely heavily on marketing communications and advertising to promote their brand.
Although this is not a major factor when it comes to the natural market however it is something
that will be need to be considered if entering into the mass market.
Once again the colour scheme is the
same as above; Burt’s Bee’s is coming in
at 29% which is quite low in comparison
to the brand leaders in the market. Also
the comparison can be made with the
natural products where we are the
market leader which is great to see
because Aveda (natural product) was
above us in the brand awareness chart
however we have now jumped above
them in the trial of products table.
Current Usage of Brands
Brand July 2005 June 2006 % Difference
Dove 57 56 1% loss
Olay 33 36 3 % increase
Neutrogena 29 32 3 % increase
Herbal Essence 27 25 2 % decrease
L’Oreal 28 32 4% increase
Chapstick 40 50 10% increase
Blistex 35 30 5% increase
Aveeno 14 19 5% increase
Nivea 12 9 3% decrease
Garnier 10 18 8% increase
Aveda 7 8 1% increase
Burt’s Bees 13 19 6% increase
Tom’s of Maine 6 6 Stayed the same
Avalon 1 1 Stayed the same
Alba 1 0 1% decrease
Natures Gate 1 1 Stayed the same
Aubrey 1 1 Stayed the same
Jason 3 3 Stayed the same
Dr. Hauska 1 0 1% decrease
The % difference table shows us that Burt’s Bees has grown by 6% from July 2005 until June
2006 in regard to usage of its products. This is the largest growth out of the entire of the natural
product market and the third highest in the overall personal care products market.
2.2 Internal Analysis
2.2.1 Revenue Growth Analysis
Distribution Background
Burt’s Bees currently sell directly to distributors, bypassing wholesalers in order to maintain
premium pricing and dictate trade terms. Offering generous margins, stocking Burt’s Bees was
an attractive idea for personal care retailers, despite their no-returns policy and withheld trade
terms.
Traditionally, the company have retailed through speciality stores, starting off in the gift shop
market, as there were few entry barriers. However, Roxanne Quimby knew this couldn’t carry
the business, and wanted to get Burt’s Bees to “everyone, everywhere”. The company opened six
retail stores, but were forced to close due to lack of retail competencies and resources within
the company. Quimby realized that ultimate success lay in mass-market distribution, and in
September 2004, Quimby signed a deal to distribute Burt’s Bees line in CVS and Walgreens drug
stores.
However, with the company beginning to move into mass distribution, there has been some
backlash from smaller retailers, with some leaving Burt’s Bees. Up to now they have tried to
combat this by dissuading large retailers from offering customer discounts, to help smaller
stores compete, but a few speciality stores have felt this is not enough.
Burt’s Bees tend to stock in “hives”, a standout product display, which CVS have allowed up to
now due to shelf space maintenance. However, with the growing new product range, the hives
will no longer fit the full range and they may be forced to move from the distinctive hive to the
shelf.
Revenue by Channel:
2002 2005 Growth ’02-05
Gift/Specialty Stores 39.9% 31.2% - 8.7%
Health Stores 29% 15.2% - 13.8%
Drug Stores 9% 29.3% + 20.3%
Distributor 5.1% 12.8% + 7.7%
Grocery 6% 6.9% + 0.9%
Other 11.1% 4.7%` - 6.4%
As we can see from the table above, patterns of revenue through distribution channels has
dramatically changed since 2002, with high growth in revenue through drugstores, considerable
growth through distributors, and slight growth through grocery stores. Revenue from gift,
speciality, health stores and other channels have all dropped significantly.
% of Respondents who considered brand natural
Annual Ad Spend as a % of revenue
2005 % Market Share, Natural Grocery
2005 % Market Share, Drug Store Channel
Burt’s Bees: 0 0 7.3 0.4
We can see from Exhibit 4 that although Burt’s Bees revenue from grew by 20.3% up to 2005
(ref. Exhibit 2), they still only commanded 0.4% of the drug store channel market share. This
could be attributed to their lack of spending on marketing communications and advertising. The
Strengths
• Effective Product
•Customer Loyalty
• Experienced Mgmt Team
•Organic
Weaknesses
• Low Brand Awareness
•Mixed Channels
•Varied Image
Opportunities
•Huge Growth Markets, Low Penetration
•Unique Competitive Advantage
Threats
• "Just Another Do-Gooder"
•Higher Price
leading competitor in this channel is Aveeno, who spent 90% more on advertising, resulting in a
1.1% market share.
2.2.2 CBBE Pyramid
The CBBE model can be seen as an integrated perceived image from its customer’s point of view,
with a mind route that a person follows to become a loyal customer. (See Appendix A)
Start from the bottom is the salience stage, where an individual receives the basic information
of the brand (product category, brand name, product name, etc.), through the marketing of that
brand or can be his/her own research in today’s two way communication environment. Then
he/she may purchase that brand to become a customer, there are two different routes that
he/she may take to form a brand image. The left hand side is the rational route, and the right is
emotional, each consists of two dimensions. To become a loyal customer, he/she may have both
rational and emotional perceptions of that brand. The rational route is very objective and more
about the product rather than the brand, the two sub headings are performance and judgment.
Performance is very fact based which would be for example the performance of that product,
price, durability and even design and style. Judgment is the actual rational stage: he/she would
judge the product and the brand in terms of perceived quality, trustworthiness and superiority,
and then decide to switch or not. The emotional route is nearly the total opposite of the rational
route. It is more subjective and may not have to tie with the physical product but the brand. The
two dimensions are feelings and imagery. Imagery is what the customer see the image that
he/she would have if link it to him/her. It is highly dependent on the brand personality and
endorsement that the brand has been built over time, and also may be influenced by other
people around him/her. Feeling is the emotional touch that a brand gives this person, which
could be highly influenced by public relation management and crisis management (in bad
situations) and etc. Approaching to the top of the model is the brand resonance, which is a
combined image and/or a sum up of all the bits and pieces that make the brand differentiated
from its competitors. This model indicates how a customer views a brand and what makes
him/her loyal to the brand. It also gives us an idea of how to build a brand that is highly likely to
gain customers and their loyalty.
2.3 SWOT Analysis
After compiling our external and internal analysis we
constructed a SWOT analysis.
Strengths:
Burt’s Bees have a strong loyal customer base built on
the back of an effective product that does exactly what
it says it does. It is almost 100% organic and is backed
by a new experienced management team. The
company’s owners, AEA, are also specialists in building
image and sales.
Weaknesses:
Although Burt’s Bees’, as stated above, have a loyal customer base they clearly lack a clear
unified brand image. They are using eight different logos and text on their products which is a
serious factor to reconsider before entering the mass market. As a result of this, customers were
unable to recognise the brand in surveys taken. Another weakness of the company is that they
are performing across so many distribution channels. This can prove a difficulty for a small
brand and it could be suggestive that they become more select in their channels.
Opportunities:
As Burt’s Bees are hoping to enter the mass market, this provides the company with a great
opportunity to continue rapid growth and sustain value. This can combine with the company’s
unique competitive advantage of being 99% organic.
Threats:
Burt’s Bees must also be aware of the threats facing them such as consumers perceiving them as
another “do-gooder” and questioning the truth behind their product. They also face a huge
threat of entering the mass market with their current price as consumers in mass markets may
choose the less expensive option.
3.0 Key Issues
Product Line: Large Product Line and some popular/unpopular products. Urgent need to
cease discontinuing habit and disappointing customers.
Brand Strength: Very poor brand strength. At present not leader in niche market in terms
brand awareness and a long way off of competing in mass market. Sustainability needed.
Retailer Relationships: Working with small retailers and maintaining those relationships is
very important to sustain value and to grow. Must weigh options of distribution up also.
Management Change: New management team may bring different views to company and
also different direction. Must be careful how situation is managed.
Where Next? Stay in niche market or go straight to mass market.
New Competitive Environment: Regardless of which direction the company goes, they are
facing new competition from both pseudo and traditional competitors as claims to be
natural are widespread by everyone.
4.0 Strategic Alternatives
4.1 Strategic Alternative (A); Staying in the Niche Market
Burt’s Bees has continued to grow consistently over the last number of years, experiencing an
enormous increase in their loyal customer base. The customer comments in Exhibit 8 show that
their current product line brings high customer satisfaction, generating positive word-of-mouth.
The company has relied on this positive word-of-mouth as a promotion tool, and it has lead to
the brand’s rapid growth in the niche market.
As mentioned in the distribution background, Burt’s Bees success began by retailing through
speciality, health and gift stores. Through these channels, Burt’s Bees products get pride of
place, having their own beehive-shaped display unit in catch the customer’s eye.
It is clear from the evidence given in the case that this strategy is working for the company.
They are continuing to grow by brand-loyal customers referring friends and family, and their
100% natural core values lie at the heart of the “fan” culture than surrounds the brand.
Continuing to focus on the niche market has some real potential for the company. According to
Parrish’s 2004 study on niche market strategy, “all of the study respondents (retailers) stated
that they have seen increased sales since implementing a nice market strategy.” Parrish also
noted that in order for a niche market strategy success depends on a number of product and
market variables. The product and brand must be differentiated, which with Burt’s Bees current
quirky branding and 100% natural ethos seems to already be working in growing their
customer base. There needs to be perceived value for the customer, which is evident in the
testimonials. The merchandising mix is important, and we feel that Burt’s Bees’ current “hive”
merchandising strategy catches the eye of potential customers in specialty stores, and this will
continue to allow them to be effective in the niche market.
We have some suggestions for expanding their current niche-market strategy to gain market
share in the category. We suggest building their relationships with retailers in the niche market,
in order to maximize retailers’ recommendations of our product to niche market consumers,
and increasing market share. This is already being done to an extent by their withholding trade
terms with mass retailers
We also suggest going into partnership with a major spa chain, with a similar value system to
avoid deflection from the brand. If we could get a spa chain to use Burt’s Bees products
primarily, we could ass perceived value to the product, use the health spa as a means to
emphasise the 100% natural element of the product offering, and increase brand awareness
across the market. Customers would then ideally see the benefits of Burt’s Bees product range,
and may become long-term users of the product range. Spas could also be used as an extra
specialised distribution channel within the niche market, selling Burt’s Bees products to
customers alongside Burt’s Bees Spa Treatments and to non-spa customers.
This strategy is achievable. It’s worked in the past, will continue to work, will be easy to
implement and changes will be minor. However, while there is rife opportunity to develop
market share within the niche market, our concerns about this strategy lie mainly in the reality
that staying within the niche market will limit the company’s potential for growth. While they
can continue to grow in this area, by limiting themselves from the mass market, they are
missing out on the chance to reach the majority of the market. Is it possible for Burt’s to reach
its potential for success by staying in this fixed niche market, and never expanding beyond it?
4.2 Strategic Alternative (B); Joint Venture to enter mass market
If we look back at the analysis our low level of brand awareness is a major factor on expanding
into and competing in the mass market. In order to rectify this problem we choose to join with a
strong “pseudo natural” brand already established in the mass market such as Herbal-Essence.
Currently Herbal Essence has a $700 million brand which repositioned itself as a pseudo-
natural product line within food, drug, and mass stores. Herbal Essence is a large player in the
personal care market in comparison to Burt’s Bees. According to Sherman (2003) the reason a
smaller firm would “seek alliances with bigger more powerful companies is because of the
credibility boost, technology leveraging and access to markets which a larger player is likely to
bring to the table”. One of the possible reasons for joint ventures or strategic alliances is to
widen or integrate product lines (Sherman 2003). Therefore we suggest that for the Herbal
essence Shampoo range they would keep their brand image, however Burt’s Bees would need to
be mentioned in all aspects of the branding process. While for the rest of the Burt’s Bees product
portfolio the opposite would occur.
When considering a joint venture as a possible growth strategy give careful thought to the type
of partner you are looking for and what resources you and the partner will be contributing to
the newly formed entity (Sherman 2003). Therefore let us look at both the positive and negative
points for each company individually if the strategy was to become a reality:
Herbal Essence:
+Their current product line only includes shampoo, by joining with Burt’s Bees they have the opportunity to utilise the full product portfolio which Burt’s Bees has to offer. This could lead to an increase in revenue for the brand due to the expansion of the product range.
+They are currently positioned as a “pseudo natural” product line; the partnership with Burt’s Bees can help them establish their products as fully natural. This allows Herbal Essence to compete within the niche market of fully natural products which will further strengthen the company’s future growth.
+They will still be the main brand image on their shampoo range; they can also use the new shampoo which Burt’s Bees has developed and market themselves as 100% natural.
+By joining with Burt’s Bees they will acquire a percentage of the loyal and enthusiastic customer base that Burt’s Bees currently have. The case tells us that these customers are invaluable to the marketing of the company because they love the product so much they become ambassadors for the product range and promote the product to anyone who will listen.
-Herbal Essence is currently only supplying shampoo to the market, by joining with Burt’s Bees this may complicate the product line which may result in customer confusion. Also the fact that Burt’s Bees will be the main brand image on the rest of the product range other than shampoo this may lead to further confusion.
-If they are to enter into a niche market of “natural products” they may need to re-price their current products to a more premium price similar to that of Burt’s Bees due to the fact that the costs will be higher if going 100% natural. This again may cause confusion with their current customer base and they may lose some of their existing customers.
-Herbal Essence already has high revenue and good brand awareness among consumers, why would they need to merge with a smaller company who offer a different product line.
Burt’s Bees
+Burt’s Bees clearly state that they would like to develop a full range of shampoo, which in 2006 they finally came up with a fully natural shampoo product. If they were to merge with Herbal Essence a specialised shampoo company, this would help them to develop and expand their shampoo line across all channels of distribution.
+As the analysis show Herbal Essence have a massive 97% brand awareness in the personal product care market and by Burt’s Bees merging with such an established firm this will allow them to distribute their products to the mass market.
+The revenue and distribution channels which Herbal Essence currently has will help Burt’s Bees expand and develop their full product range.
Rebrand1.Niche
Market Campaign Build Up
2.Selected
Mass Market
3. Entry4.
+The joint venture is with a company that is in the pseudo natural range already, so at least it’s not as traditional product range company.
-By merging with a company such as Herbal Essence they may lose the authenticity of their brand and this may result in once loyal customers becoming disillusioned with the brand.
-Burt’s Bees has just established their natural shampoo, however by joining with Herbal essence this may compromise their new shampoo product.
-Herbal Essence specialise in hair care however they do not have any other products which means they bring limited expertise to the joint venture.
From a Burt’s Bees point of view the joint venture with Herbal Essence will allow an easier path
to expanding into the mass market and it will also help them to expand their product portfolio
especially the shampoo line. The venture would give Burt’s Bees access to greater capital and
larger distribution channels. However it seems that the benefits for Herbal Essence entering
into the joint partnership greatly outweigh the benefits for Burt’s Bees. The disadvantage for
Burt’s Bees entering into a joint venture with Herbal Essence would be that Burt’s Bees would
be forced to give up a certain amount of control (Sherman 2003). If going with this strategy
Burt’s Bees also runs the risk of losing its authenticity and original core beliefs by joining Herbal
Essence in partnership. The risk of joining the two brands together as one is too high and will
more than likely result in brand confusion for the consumer. Burt’s Bees should explore other
strategies to ensure market growth.
5.0 Chosen Strategy: Rebrand-Strengthen Awareness-Enter Mass Market
For our chosen strategy, we have decided on a rebranding strategy to increase and strengthen
the brand with the long term aim of expanding the brand within the mass market. As stated
above we feel that the image of the brand is simply not sustainable to compete in the mass
market and to an extent is the reason that the brand is not the most
instantly recognized within the niche market. We believe that the
number one issue for Burt’s Bees’ is to grow the brand without
compromising the product i.e. ingredients.
We believe the strategy will follow four key steps, above.
To begin, we feel that a large part of the weaknesses of the brand can be accounted for by the
lack of advertising spend and multiple imagery across product lines as discussed earlier.
Therefore we suggest one logo for the entire product portfolio, See Above. We have developed a
logo that is similar to the ‘Innocent Smoothies’ logo as we feel that this is an appropriate way to
position the brand and differentiate the brand from competitor’s, both niche and mass market.
As well as a differentiator, the characteristics of the brand, such as honesty, commitment,
organic and fair-trade can be leveraged as part of the entire offering. Brand personality can be
Skincare Facecare Body Hair Outdoor Baby Mens
defined as the “embodiment of personality traits of the consumer in the brand itself” (West, Ford
& Ibrahim, 2006; P259). Through this tactic we feel we can compete with the larger traditional
competitors in the mass market as consumers will associate their own characteristics e.g.
honesty with the brand more clearly. This strategy of rebranding
should take approximately six months to one year we believe and
should create a clear unified umbrella brand for the company to
bring forward when moving into the chosen market. This
new simple logo can also improve customer’s
perception of brand, see CBBE Appendix B.
A clear unique value proposition needs to be defined for the company along with the brand
image. We believe that the best way to this is to develop a proposition is around the healing
powers of the products. Many customers have praised the products for their healing powers so
this is a key customer insight and would be the strongest pillar to build the brand on.
Following this we suggest that a large portion of turnover is put into an advertising budget and
new packaging with the new branding as currently there is no advertising spend. This can be
done through sample days in store, coupons, television advertising, unifying the one image
online at burtsbees.com, incorporating social media into the media plan (customers as brand
ambassadors) and billboards.
After time has been spent building up the brand image within the niche market, we feel Burt’s
Bee’s should assess their consumer awareness again and relate it to their competitor’s. We
estimate that by then, the awareness figures will have raised and then the company will be
sufficiently equipped to compete within the mass market.
The next step for Burt’s Bees is to now carefully select which categories they will compete in
within the mass market and which distribution channels to use. We recommend that they aim to
compete in the Hair care, Nail Care, Shaving, Skin Care and Fragrances categories as these
represent the best opportunities for growth as all have relatively low penetration and high
growth rates. As well as this, most of these categories are aligned with existing products
available in the Burt’s Bee’s range currently, thus lowering NPD costs.
When selecting distribution channels, we feel Burt’s Bees’s priority should now be with drug
stores, distributors and grocery as they are now a mainstream product. We would aim to be still
in gift shops and health stores through working close relationships with them, but acknowledge
that we are losing some of the uniqueness which may make the brand unpopular in these
channels. However despite this we feel the reasoning is adequate as drug stores and
distributors are a growing trend in the company’s revenue streams as highlighted in analysis,
cumulative gain of 28.9% of revenue in 2005. We feel that this is also adequate as in order to
align with the long term goal of seeing the product in all mainstream stores we must be willing
to grow more.
Finally as part of this strategy, we feel that Burt’s Bees should keep measures of their progress
and understand that this is not an overnight strategy and is a long term strategy. Burt’s Bees
should not attempt to try to do too much and keep things simple. In order to grow they must
sustain current customers whilst providing the same value whilst attracting new customers
through the improved image of the brand.
Other suggestions regarding going mainstream we had were perhaps 5 years down the line,
developing food products, i.e. Honey and Lemon Healing drinks for mass market. Another
suggestion is perhaps looking into getting fair trade stamps of endorsement or 100% certified
stamps.
We believe that this chosen strategy is achievable and realistic because of recent consumer
demand trends for organic natural products and because we are not compromising the core
values of the product but simply architecting a structured brand and product portfolio whilst
sustaining existing customer value.
6.0 Case Lessons
It is very important to have a product portfolio that has a consistent brand image. At the
moment Burt’s Bees products are quite diverse and this may cause customer confusion,
especially when entering into the mass market.
The original vision of the Burt’s Bees brand was to have their natural and earth friendly
products reach everyone, everywhere. Although this may cause the brand to become too
commercial, sometimes in business it’s about making a decision and implementing it in
order for it to work for the company.
The loyal customers of Burt’s Bees are integral to the future success of the company. As
stated in the case they are very passionate and truly love the brand. Therefore whatever
future growth strategy that Burt’s Bees decide on they must not offend their current loyal
customers by compromising the authenticity and fully natural elements of the product
range.
7.0 Bibliography/Appendices
Books:
West, Ford & Ibrahim, (2006). ‘Strategic Marketing’, Oxford Publishing.
Doyle & Stern, (2006), ‘Marketing Management and Strategy’, 4th Ed., Prentice Hall.
Keller, (2008), ‘Strategic Brand Management’, 3rd Ed., Pearson Education.
Article:
Sherman, A. (2003), ‘Growth through Joint Ventures and Strategic Alliances’, Fast track Business
Growth. Available at Business Source Complete.
Journals:
Parrish, 2004. “Retailers use of Niche Marketing in Product Development”. Journal of Fashion Marketing & Management; Oct2010, Vol. 14 Issue 4, p546-561.
Brand Resonance
Loyalty & Sense Of CommunityJudgement
Feelings
Perceived Quality Social Creditability Responsibility
Value for money Healthy
100% Natural
PerformanceImagery
Smell Values
Healing Certified Endorsement
Efficacy Bees are natural
Brand Saliance
Category Awareness(NPC), Relatively Strong Brand Awareness
Appendix A: CBBE Pyramid
Appendix B: Declaration
Declaration
We hereby certify that this material which we now submit for assessment
on the programme of study leading to the award of MBA Marketing is
entirely our own work, and has not been taken from the work of others,
save, and to the extent that, such work has been cited and acknowledged
within the text of our work.
Signed: _______________________ ID No: ______________ Date: _________
Signed: _______________________ ID No: ______________ Date: _________
Signed: _______________________ ID No: ______________ Date: _________
Signed: _______________________ ID No: ______________ Date: _________
