Consumer Behaviour - Sk-II

Abstract

In today's modern world, the need for facial care has growth tremendously. This is especially from the demand of the office ladies.

SK-II perceived the needs in the market and came out with this product called Facial Treatment Essence (FTE). FTE is of the core product within the SK-II range providing the highest Piteria® to the skin. FTE is claiming to be suitable for "woman from all walks of life".

We had conducted interviews with two consumers of different age group and social class to compare them and learn how their need and perceptions of SK-II FTE. The interview was carrying out based on the five steps Consumer Decision Making Process Model (CDM). In addition, consumer profile of the chosen target segment was conducted to explore the characteristics of age groups and environmental influences that influence consumer decision making.

The hypotheses of difference between SK-II users in terms of socio-demographic and psychographic characteristics can only be partially accepted. While consumers are similar, they are not identical. SK-II Heavy Users spend more annually on skin care products, and tend do to more shopping than SK-II Light users for such products at department stores.

The primary factor influencing the decision to purchase skin care products is referral by friends or family members, while moisturizing functionality and quality are the most important product characteristics in the consumer's opinion. Finally, it is the consumption of the SKII Pitera®.

Given the intense competition in the skin care product industry, it is expected that strategies for marketing channels will become more complicated, brand images will become more important, and demand for sophisticated and expensive products will increase. Increased competition has been damaging to SK-II market share holding, but this competition also reflects great market potential arising from trends in Singaporean socio-demographics

Furthermore, recommendations were provided for the marketing of SK-II products.

TABLE OF CONTENTS PAGE

Assignment Cover Sheet 1

Abstract 2

1. Introduction 4

1.1 Background of SK-II: One of the World-Leading Cosmetics Brand 4

1.2 Purpose of the research report 4

2. Literature Review 5

2.1 Hypotheses 6

2.1.1 Differences between SK-II Heavy and Light Users 6

2.1.2 Importance of Product Characteristics for SK-II Users 6

2.1.3 SK-II Users' Reasons for Purchase 6

2.2 Skin Care in Singapore 7

2.2.1 Anti-Aging 7

2.2.2 Celebrity Spokesperson 7

3. Profiling SK-II Consumers according to the Consumer Decision Making Process 8

3.1 Socio-demographic and Psychographic Consumer Characteristics 8

3.2 Consumer Profile 9-10

3.3 Motivations for Purchase 10

3.4 Product Characteristics 11

3.5 Purchase Channels 12

3.6 Findings 13

4. Recommendations 14

5. List of References 15

1) Textbook References 15

2) Study Guide Journals 15

3) Website References 15-16

6. Appendices 17

1) Respondent Profile 1 17-21

2) Respondent Profile 2 21-24

1. Introduction

1.1 Background of SK-II: One of the World-Leading Cosmetics Brand

SK-II is a leading, high-end beauty brand with a wide array of skin care products. Created by MaxFactor, the brand was acquired by Procter & Gamble in 1991. "SK" stands for "Secret Key", referring to an ingredient present in all SK-II products - Pitera® - a yeast-based substance containing a variety of vitamins, minerals, amino acids and organic acids that "enhance skin surface renewal", the secret to smooth and beautiful skin (SK-II, 2006).

The brand, SK-II, began its fascinating story from a sake brewery in Japan, where scientists discovered the elderly workers had wrinkled faces, but with extraordinarily soft and youthful hands. After years of research, the scientists finally came out with a miracle ingredient called Pitera®, a naturally-occurring liquid from the yeast fermentation process of sake. Since then, SK-II with Pitera® has become the beauty regimen of many celebrities and beautiful women around Asia and the world.

1.2 Purpose of the research report

The purpose, then, of this report is twofold: 1) to develop material in relation to the consumption of skin care products in Singapore in an attempt to understand the socio-demographic characteristics of SK-II consumers, as well as their product attribute preferences and reasons for purchase, and 2) to explore the decision-making process of a group of SK-II consumers when purchasing SK-II.

2. Literature Review

Facial Treatment Essence (FTE) is the core product within the SK-II range providing the highest level of Pitera® to the skin. It is SK-II's key product to get new consumers into the brand and maintain their loyalty. Because it is also the oldest product in the SK-II line up, there is no clear understanding of what benefits consumers see and how they describe them.

Qualitative study was conducted to learn about:

1) How consumers perceive the brand, SK-II and product, FTE.

2) To develop a SK-II