A New Product for a Popular Skincare Brand: Part 2 of the Marketing Plan
The following is a marketing plan for a suggested new product for the popular skincare brand, Kate McLeod. This plan was developed as a marketing exercise for graduate school and is not affiliated with Kate McLeod. All information was gathered through online research. Part 2 of the marketing plan includes sections outlining the current business climate, the SWOT analysis of the brand, critical issues faced by the brand, marketing and financial objectives, and identifying the target audience for the product.
Part 1 of the marketing plan includes sections outlining the suggested new product, the value proposition of this product, a summary of the company, as well as direct and indirect competitors to the company. To read part 1, click the button below, which is also linked at the bottom of this post.
Business Climate
To evaluate the current business climate for Kate McLeod, this section includes a Political, Economic, Social, and Technological (PEST) analysis.
| P Political | E Economic | S Social | T Technological |
| -Manufactured in the United States Woman-owned and woman-founded -Core of sustainability: Sustainably manufactured and packaged with sustainable ingredients | -Inflation has fallen to 6%, the lowest since September 2021 (Trading Economics, 2023) -Inflation in the US remains three times above the Fed’s target of 2% (Trading Economics, 2023) | -Target audience age 25 to 40 cares about the environment: sustainability in packaging and materials matters -Target audience age 25 to 40 cares about brand values and brand ethics | -Target audience is shopping online from all devices: Traffic from desktop is roughly 7,000 a month while traffic from mobile is roughly 6,000 a month (Semrush, Katemcleod.com, n.d.) -Target audience is active on digital platforms |
Political factors such as the taxation policy, trade regulations, government stability, and the unemployment policy have not changed in a way to impact the Kate McLeod brand (Boundless Marketing, n.d.). Important political factors for the brand focus on the location and processes of manufacturing for the Kate McLeod product line. This has been the primary focus for the brand since its founding. As stated by founder Kate McLeod, “We have taken our time, gotten to know our customers and our product, and thankfully have been able to scale right alongside the increased demand” (Carlson, 2022). This approach to scalability will be continued with the new offering of The Crown Stone.
Customers worldwide have been impacted by the economic effects of the global pandemic. In the United States, the inflation rate currently sits at 6%, “remaining three times above the Fed’s target of 2%” (Trading Economics, 2023). Inflation is impacting all aspects of consumer spending, with Food Inflation sitting at 9.5%, Services Inflation remaining at 7.6%, Energy Inflation dropping to 5.20%, and Rent Inflation rising to 8.1% (Trading Economics, 2023). This creates concern and instability in consumer budgets. However, this is the lowest inflation has been since September 2021, which is encouraging for consumers (Trading Economics, 2023).
There are a number of changes happening on a global scale following the pandemic. These include “as accelerated climate change, growing economic inequality, declining trust, increasing polarization, and worsening global financial conditions” (Deloitte, n.d.). Because of these changes, consumers are investing in brands that align with their personal values (Deloitte, n.d.). This is a positive for Kate McLeod that was founded on strong brand values that encompass sustainable and ethical manufacturing processes, which is a priority for the brand’s target audience.
Technological factors encompass “internet, e-commerce, social media, and level of automation” (Boundless Marketing, n.d.). These areas are covered by Kate McLeod’s distribution and marketing strategies. It is imperative for the brand to continue to meet the target audience on the digital and in-real platforms it engages on. Deloitte states that “[t]he growth of digital goods and services outsize and displace spending on traditional physical categories” (n.d.). The Kate McLeod brand is mindful and strategic in brand positioning, brand identity, and availability of products on digital platforms.
SWOT Analysis
The SWOT Analysis below discusses the strengths, weaknesses, opportunities, and threats to the Kate McLeod brand, specifically related to the introduction of the new product, The Crown Stone.
| S Strengths | W Weaknesses |
| -Scaling the brand in relation to demand -Established market share with loyal customers and strong word-of-mouth marketing | -Introducing a product customers do not know they need yet -Product requires consumer education |
| O Opportunities | T Threats |
| -Deepening product line in the sustainable and ethical beauty categories, specifically skincare and haircare spaces | -Introducing new competitors with equally established market share, but competitor products do not require as much consumer education |
Since its founding in 2018, Kate McLeod has been able to scale its brand and offering in relation to customer demand. This has allowed for sustainable, continued growth while delivering on core values. This approach has built customer trust and supported Kate McLeod’s reputation as an established brand with loyal customers, increasing the brand’s market share. This strength is built into the fabric of the brand and will be leveraged in the development of The Crown Stone. Likewise, the identified weaknesses are challenges the brand faced when launching each of the previous products. The brand is familiar and expert at introducing entirely new products that require customer education. While this may be presented as a weakness, Kate McLeod will utilize these weaknesses as a strength.
The Crown Stone presents an opportunity to deepen the brand’s reach into sustainable, ethical skincare and haircare categories with thoughtful luxury. This will increase Kate McLeod’s market share and encourage customers to incorporate the brand into more steps of their personal care and wellness routines. Customers are demanding responsible brands, which is the foundation of the Kate McLeod brand (Deloitte, n.d.). A threat to this growth is that the sustainable, ethical haircare category includes strong competitors including Gisou. These brands offer a straight-forward product that is applied in a traditional method, requiring little to no consumer education, which is different from Kate McLeod’s The Crown Stone. This threat could prevent Kate McLeod from “achieving the objective” (Thousand Insights, 2009) and must not be disregarded in strategy implementation.
Critical Issues
This section will present strategies for maximizing strengths and opportunities while minimizing weaknesses and threats identified in the SWOT analysis. These have been touched on in the previous section. The first strategy harnesses an S-O Strategy, using strengths and opportunities from the SWOT analysis “to maximize the identified opportunities” (Thousand Insights, 2009). When introducing the new product, The Crown Stone, Kate McLeod will scale the business in relation to customer demand. This will ensure manufacturing and packaging processes align with the brand values and customer expectations. Additionally, this will keep Kate McLeod products in the Hudson Valley.
The second strategy harnesses a W-O Strategy, which will “minimize weaknesses by capitalizing on identified opportunities” (Thousand Insights, 2009). This strategy was addressed above. While The Crown Stone will be a new product in the haircare space – a solid hair oil to treat the scalp and promote healthy strands – it also requires consumer education since it has a unique application, being a solid instead of a liquid. This challenge is not new to the Kate McLeod brand as the brand is “accustomed to providing education” (Carlson, 2022). This experience will help the brand seize the opportunity and delight customers. This segues into the third strategy, the S-T Strategy that will leverage the brand’s strengths to reduce vulnerabilities (Thousand Insights, 2009). Kate McLeod redefined the luxury skincare category with the launch of the original Body Stone. While The Crown Stone will introduce new competitors to the brand, Kate McLeod will leverage its market share and intentional approach to scaling its business to create loyal customers and outperform competitors.
Finally, the last strategy is the W-T Strategy that minimizes the brand’s weaknesses to reduce threats (Thousand Insights, 2009). This strategy is designed to protect the brand from loss rather than generating profit (Thousand Insights, 2009). It will be important to present the unique application and form of The Crown Stone as a benefit instead of an obstacle. Competitors in the sustainable and ethical haircare space may not necessarily focus on the same environmental impact of Kate McLeod from start to finish in the manufacturing process, which is a factor in how the brand’s products are packaged and thus applied. This can be included in the sustainability claims of the brand to differentiate the product from competitors.
Where Do We Want to Go? Objectives and Analysis
Marketing Objectives
A goal of the organization from the foundation was to approach scaling the business profitably. This has led to low customer acquisition costs and increased customer retention. As part of the launch for The Crown Stone, there will be three marketing objectives that the brand will reach in the first year. The first objective is to achieve $1.5 million in product sales, which is explained in more depth in the Financial Objectives section below. The next objective is to increase annual revenue to $15 million from $10 million, a year-over-year increase of 50%. The final objective is to reach 10,000 sessions monthly from organic traffic on the website, an increase from roughly 7,000 sessions. These objectives will be achieved through strategic marketing, outlined in the following sessions.
Financial Objectives
Kate McLeod was founded in 2018 and has been profitable since 2020 (Pitchbook, n.d.). The brand currently has 11 employees and raised $100,000 in 2021 during a round of funding (Pitchbook, n.d.). The brand had an annual revenue of around $5 million in 2021 (Zoom Info, n.d.). In 2022, Kate McLeod’s annual revenue reached $10 million. Each new product launch has cost roughly $50,000 (Carlson, 2022). The goal for The Crown Stone is in line with past growth and the brand’s approach to scaling, which is thoughtfully and alongside demand. Kate McLeod is already expanding the marketing team in New York City, hiring a new Social Media and Community Coordinator with an annual salary range of $65,000 to $85,000 (Kate McLeod, n.d.). With these factors in mind, it is recommended that the brand dedicate $75,000 to the marketing and communications budget for the product launch. This delivers a sales goal of $1.5 million for The Crown Stone.
Customers/Target Market Analysis
The target audience for The Crown Stone is the Kate McLeod customer. They are middle to upper class femme individuals (men, women, and nonbinary people who present female) between the ages of 25 and 40 years old. The VALS Sample Demographic and Behaviors classifies these individuals as “Achievers” (Sample demographics and behaviors, n.d.). They are aspirational, hardworking, and moderate (Sample demographics and behaviors, n.d.). The Kate McLeod customer works hard and expects products to deliver expected results with high-quality ingredients. They are thoughtful and intentional with their purchases, choosing brands and products that align with their values.
The target audience for the Kate McLeod brand cares about sustainability and ethics throughout the manufacturing process including the quality of the ingredients used and the packaging of the product. However, the Kate McLeod consumer does not feel these principles mean sacrificing quality, expected results, or a luxury user experience. The Kate McLeod consumer is active online and researches new, innovative, and sustainable trending skincare products. These products are promoted by trusted influencers, trusted blogs and articles, and through social media channels. This consumer conducts research on these products through trusted magazines, industry-leading websites, and through social media channels including YouTube. The Kate McLeod consumer is comfortable researching ingredients and their benefits and purchases products anticipating certain results from ingredients. The Kate McLeod consumer has deep expectations of brand integrity and brand purpose as well as the type of quality products their money can buy. They expect Kate McLeod products to meet and exceed their expectations. These consumers embrace personal care and feel strongly that personal care directly impacts their overall health.
Over 80% of the site traffic to the website is from the United States. This means that most of the audience is based in the United States, even though the brand has expanded internationally into Canada and the United Kingdom. This leaves opportunities for growth in international markets. Semrush shows that Kate McLeod currently has 87% market share (katemcleod.com, n.d.). This valuation is based off of keywords and competitor keywords and is not a reflection of marketing objectives. However, it does enforce that the marketing mix for the brand has been effective in the digital space, making Kate McLeod the prominent brand in the luxury skincare space. This can be leveraged with the launch of The Crown Stone to reach the target audience.
References
Boundless Marketing. (n.d.). “The Marketing Environment: Scanning and Analysis.” Accessed from http://mono.ssi.svc.cluster.local/study-guides/boundless-marketing/the-marketing-environment/.
Carlson, Jane. “3 Strategies That Paid Off for Skincare and Body Care Brand Kate McLeod.” Beauty Independent, October 25, 2022. https://www.beautyindependent.com/3-strategies-that-paid-off-for-skincare-body-care-brand-kate-mcleod/.
Deloitte. (n.d.). “Buying into Better: The Future of the Consumer Industry.” Retrieved from https://www2.deloitte.com/us/en/pages/consumer-business/articles/future-of-consumer-industry.html.
Kate McLeod. (n.d.). “Social Media & Community Coordinator.” Retrieved from https://boards.greenhouse.io/katemcleod/jobs/4052525005
Pitchbook. (n.d.). “Kate McLeod Company Profile: Valuation & Investors.” Retrieved from https://pitchbook.com/profiles/company/499194-01.
Sample demographics and behaviors. (n.d.). Strategic business insights. http://www.strategicbusinessinsights.com/vals/demobehav.shtml
Semrush. (n.d.). “Katemcleod.com: Domain Overview.” Retrieved from https://www.semrush.com/analytics/overview/
Thousand Insights. (2009, March). “SWOT Analysis.” Retrieved from https://thousandinsights.wordpress.com/articles/on-strategy-planning/swot-analysis/
Trading Economics (2023, March). “United States Inflation Rate – February 2023 Data – 1914-2022 Historical.” Retrieved from https://tradingeconomics.com/united-states/inflation-cpi
ZoomInfo. (n.d.). “Kate McLeod – Overview, News & Competitors.” Retrieved from https://www.zoominfo.com/c/kate-mcleod-inc/463477703
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