Lush Case Analysis.

(Gorbatenko Oxana, international marketing)

How LUSH creates value.
The whole point of Lush is that it should be fun for our customers and fun for us, while
at the same time offering original products that work and give value for money
Our aim is to offer the freshest products in the history of cosmetics.
Create cosmetics that bring fun to peoples homes LUSH
Geographic:
Lush cosmetics is a global company, with over 500 locations in 38 countries.
Retail stores in many major metropolitan markets and a worldwide mail order business.
Its market is mostly urban centers and tourist locations.
Climate is not a predominant consideration.
Demographic:
The age spectrum of Lush cosmetics tends to be the 18 years of age and above market.
Consumers have both knowledge of environmental and sustainability issues as a part of
the customers value set. The price point and store location are most in high-end retail
area and a part of their marketing strategy, to place in the luxury goods sector.

Gender: Clients tend to be mostly female.

Family Size: Varies

Family Life Cycle: Young, urban dwellers, single or married, children or not

Income: Middle income to higher income levels

Occupation: Varies

Education: Varies. Consumers have knowledge of environmental, sustainability,

animal rights issues. This knowledge can be found across the spectrum,
although, more educated people tend to have a more detailed
understanding. Higher educated people may have more disposable income
to purchase higher end specialty products.

Religion: Not relevant

Ethnic origin: Not relevant

Generation: Generation X, Y, and Baby Boomers.

Psychographic:

Social: Middle to upper classes.

Lifestyle: Achievers, strivers and survivors

Personality: Thoughtful about purchases, not compulsive

Behaviorial:
Occasions: Mostly regular occasion (daily use); but there are special occasion products
in the Lush cosmetics line. For example, Christmas products, Easter, halloween.

Benefits: A quality, non-chemical, ethical product (not tested on animals)

Higher level of service in store (cut soap to order, wrap onsite), in store
explanation of products. Salespeople at LUSH are required to give at least
five product demonstrations throughout a potential customers instore visit.

User Status: Regular users, with a growing emphasis for new users (number of
stores had grown rapidly just in ten years in business)

User rates: Heavy user (LUSHIES)

Loyalty status: Medium to strong

Readiness Stage: Informed and interested

Attitude toward product: Positive, in some cases enthusiastic

Core Benefit:
Lush is about passion and iconoclasm: passionate for natural products, fresh handmade
cosmetics, seductive perfumes, growth and profit and iconoclastic about everything
else. Angus Jenkinson
- passion for fresh and handmade products
- offbeat, differential
- fun natural wholesome ingredients emphasis on DELICIOUS ENJOYMENT
- to help the customer to find a product that does the job it says (intended task effectively)
- dedication to delight customers
- humour
- fun for the customers and fun for us
- cheeky brand
- authentic brand
- personalized
- pleasing value

- experience
- unconventional products that are natural, homemade and unique looking and a great
experience
- wholeness and innovation (customers are a part of the operation)
- fun, quirky, natural, good for you,
- promotes natural healthy ingredients

Actual Product:
- variety of products in skin care, bath and body care, off-beat gift ideas
Brand Name:
LUSH: evocative name
- Cheeky, authentic, fun brand
- Stores distinct smell wafts outside stores into the street, providing lush with a distinct
way of marketing which is recognized as a part of the lush brand.
- scent story branding
- Fun sounding names for its products (Sex Bomb, The Big Calm)
- Freshness, nature and fun: heart and soul of lush and what lush represents
- Customers are happy with the brand experience
- LUSH had a customer competition to come up with its name, very close to its customer base
(Elizabeth Bennet from Edinburg thought of the name)
- Stores are not franchised to ensure the LUSH concept is endorsed and maintained.
Quality level:
- handmade
- natural organic ingredients
- 70% products no preservatives
- Produced in Farm kitchens
- Products are created and made, based on Mo's own tastes and preferences as well as the producers.
- Expirary dates on products which endorses the brands "freshness" and high quality
- Some products need to be kept cold in fridge
- Fresh ingredients = health trend. More consumers are becoming concerned with living a
healthier lifestyle which encorporates much more than healthy eating and exercise (what
you put on your face is also a big deal)
- Affluent customer base that is more educated about quality and variety
- Fair trade ingredients, as well as packaging
- Does not test on animals
Packaging:
- NAKED!
- minimal packaging to none at all
- shampoos deodorants in solid bar form
- soaps in grease proof paper
- bubble bars, ballistics no packaging at all
- 100% recyclable paper bags to take home items
- Organic and natural products are color coded

- Recycled cardboard packages

- Minimal packaging is not only green it also provides store with distinct smell
- Popcorn as a filling for its mail orders, crumpled recycled paper
Design:
- colors, shapes, sizes and aromas of the products, products could sometimes be mistaken
as edible (bread, stacks of fruit)
- names of products very unconventional Buffy the backside slayer skin conditioner,
Demon in the Dark soap,
- shaped like huge cakes / loaves of bread; priced by weight
- self-professed cosmetics grocer
- displays like a fruit stand Ive always loved the way fruit and vegetables are displayed
in a grocery store Constantine
- products sometimes start merely as words suggested by the customer (swoosh, smitten)
- INSTORE DISPLAY: old fashioned grocer, beauty deli, product lists on chalkboards
(small corner store grocer feel)
- Mimics products of small independent retailers (craft sale)
- Producers name is on lush products: name as well their cartoon face (homemade
quality)
- walk around its remarkable stores th..
Features:
- innovative products (bath bombs etc)
- superior customer service
- LUSH educates customers on how to use their products
- product range- single consumable (bath bombs) to full skin care lines
- staff encouraged to contribute ideas and inspiration from all sorts of strange places
(music lyrics, movies)
- retail is distinct, delicatessent
- The distinct LUSH smell is an emotional connector with its consumers
- retro lush: select from a list of discounted products ones customers would like to see
remade (encourages brand loyalty)
- shop is a blend of fragrances, bright colors, shapes, funny names, smiley faces and
helpful people. (delight/in store experience to shop there)
Augmented Product:
- fresh natural ingredients
- freshly made cosmetics
- no animal testing policy
- environmentally friendly packaging
- healthy products
- helpful and friendly staff
- attractive store layout and ambience
- product functionality
- product lines for vegans
- charity pots
- lushopedia
- Free Expedited Parcel shipping on orders of $75 and Free Xpress Post shipping on
orders of $90*

- LUSH wants you to be happy with your purchase. If you would like to return or
exchange a phone or web order, please call Customer Care toll-free to obtain a return
authorization and receive further instructions
- Please return items in their original packaging and include a copy of the packing slip.
You can return items up to 45 days after the date we shipped your order. Shipping
charges are not usually refundable.
- online reviews of products on their site
- forum for lushies
- site is very charming, eclectic
- information on reducing your carbon footprint/ having a green washroom
- personal contact (not automated phone services)
~ Core benefit VS how LUSH creates superior value
PRICE Customer Cost:
- priced less than companies such as the body shop
- more than local competitors and supermarkets
- usually priced by weight
- fair
- Honesty: one of the most important values in lush. Fair prices for the customers
are balanced by a fair profit margin for the organization.
Cost plus basis? (Adding a standard mark up to the cost of the product)
Value priced method? (Setting a price based on buyers perceptions of value rather
than on the sellers costs)
PLACE Convenience
- multi channel strategy
- chain of stores
- mail order (cross selling)
- online
- Constantines vision was to have 1000 lush stores world wide by 2008
- store locations: Very choosy about sites
- product ranges vary in store and mail order
- located in prime areas (e.g. In Edmonton one location in West Edmonton Mall the other
on Whyte Ave)
- posh localities, next to high end stores, creates a premium image
- high end shopping areas, next door to boutiques and jewellery shops.
- Lush is then noticed by less price-sensitive and sophisticated clientele and associated
with luxury

Strengths
Lush means green, luxuriant and fertile.
Their policy against animal testing made lush more
prominent in the consumers mind.
It is powerful brand, which attract people all over the
world.
It does not use raw materials that have been tested on
animals.
It is an example of great customer service and experince.
Online delivery is another strength for the company to
serve them the best they can and generate more
revenue.
Lush does not have a fixed market subdivision; they
attract their customer with superior marketing offers.
Word-of mouth is indeed one of the most powerful
marketing communication channels.
Lush communicates with the help of their products.
Lush uses the internet for communicating and marketing.
Lush believes in making products with fresh vegetables
and fruit and without use or limiting the use of any
harmful product or ingredient.
Lush always has the quantitative ingredient list (label)
outside the product (usually on a chalkboard beside the
product).
Lush prints their own labels and creates their specific
fragrances.
Lush fragrances encourage people to buy their products.
Lush has a premium image, which encourages
customers of the product value and promotes revenue as
well.
Charity campaigns promote a sense of community to
consumers.
The Lush website has a blog which gives an opportunity
to both customers and company to communicate with
each other.
Lush always provides a friendly atmosphere to its
customers and its packaging promotes a healthy
environment.
Lush has some of the freshest cosmetics in history.
Fair prices for customers are balanced by fair profit
margin for the organisation``.
Lush stores are always located at high rent places so
these places helps to advertise lush brand and promotes
the brands luxurious status.

Weaknesses
Lush is not as big of an issue but still it effect some
times.
Many people buy cosmetics or soaps to give as a
gift but lush packaging is not very attractive.
High prices of products that are premium are not
affordable for lower class.
Many people cannot buy products because they
are located in specific places, not convenient to
purchase and less distribution outlets.
Pure products always has the issue of keeping
them in fridge, so this always makes people
sometimes leery before buying.

Opportunities

Threats

The word's growing and continued passion for

fresh and healthy products for the skin and
body is the opportunity for a lush to sell
products.

Economic recession is a big threat for all

companies including lush. Other competitors
like MARK and AVON are also in a way of
success. Body shop is also a big challenge for
lush. Even though the Body Shop have higher
prices than LUSH people are crazy about it
and like to purchase the body shops products.

People are passionate about lush products

and fragrances. Every lush idea is coherent
and aligned with their passion.
Lush cosmetics and WSPA partnership to help
endangered organ-utans may help people to
give more favour.
Almost all people use handmade creams,
cosmetics and soaps.
Increasing rate of store numbers is also an
opportunity.

Social Responsibility
Product:
Customers
satisfaction and
companys
allegiance with
customers

The major tenant of Lush is social responsibility, with products that are designed
to attract not only loyal base of customers but in many cases attract new
customers by using its activism as a catapult to create buzz on new products.
They are passionate about the environment and promote campaigns that
encourage environmentally friendly behavior(for example their discontinued use
of palm oil in their products when they viewed the market to be corrupt.). They
focus on producing, 100% vegetarian (and over 70% vegan) products for bath,
hair and body that are fresh, made with natural ingredients, not tested on
animals and minimally packaged (widely known as the naked campaign, where
the company focused on using post-consumer recycled paper, recyclable and
biodegradable products whenever possible, if they cannot get rid of the
packaging at all.)
Lush factories receive fresh produce every day, in much the same way as
restaurants continually receive fresh produce, and use it to manufacture
products right away.
With care and passion, Lush adds value that matters to their customers on a
socially conscious level for example, by using fresh, natural ingredients in their
products therefore offering a specialized product, by promoting a no animal
testing policy, environmentally friendly packaging, healthy products; and
behaving as a voice of protest, usually causing interest in the company itself to
their own benefit.
Although Lush foucuses it energy on remaining all natural making over 300

different products that are usually approximately 2/3 are unpreserved

ingredients. Lush touts that preservatives are poisonous by nature. They also
focus on using minimal amounts of water because liquid products containing
water require preservative due to bacteria potential of the environment. So
while Lush doesnt commit to being completely natural (which would severely
cut into best before dates on products) they do try to stay as close as possible
by holding the policy that products may only contain two kinds of preservatives;
methylparaben and propylparaben, and even these are ingredients that have
been proven safe and have been used in cosmetics and skin care for over 60
years. Using more and/or stronger synthetics would not benefit the skin. Unlike
other cosmetic products, that do not advertise when the product was made,
meaning could be anywhere up to 3 years old, Lush only sell their preserved
products for up to 4 months after they're made with the longest total shelf being
approximately 14 months.

Lush offers customers good value while the company still making the profit.
Price: Price
consistency and About 65% of their products sell under $10. Their most popular soap brand sells
between $4 dollars to $6 dollars. They are famous as cosmetic company of a
variation
less-priced sensitive, sophisticated customer, and associated with luxury.

Generally, Lush products have usually priced less compared to other cosmetic
companies like Body Shop but more than the price of local competitors and
supermarkets. Many of their products like variation of soap and have different
designs, it is priced by weight, not per item or product. It is also a more for more
product line. The product offer high quality, and gives prestige to the buyer. The
price difference exceeds the actual increment in quality.

Place: Different
outlets
distributing, less
delivery
charges, and
free at some
extent

Lush are now trading 43 countries around the world. There are more 1,000
stores globally within ten years in business. Lush made a multi- channel strategy.
They ran a mail order operation and sold its product online. With a wide range of
products, they used a mail order catalogue for cross-selling products to their
existing customer. Most of Lush stores are located in prime areas and they are
very particular with their location. They choose location that is in the high endbusiness/ shopping area.

Promotion:
Proper
advertising and
fair products

Lush has no marketing department and they do not need one. Word-of-mouth is
one of the most powerful marketing communications of their channel. In Lush,
everyone is a marketer and everything communicates. The companies advertise
little through media such as TV. They advertise through its products, people,
website, and mail.

Lush is very socially responsible company with their customers they serve for example;
in Canada alone, they support ten charities:
1) Earthroots-Lush helped with the lake Algonquin Logging legal fees. The Ogoki forest
in remote Northwestern Ontario is home to the threatened Woodland Caribou.
2) Sea Shepherd- Lush aided in efforts to end the Canadian Commercial seal hunt. Sea
Shepherd has been at the forefront of depending seal pups against a brutal and senseless
government subsidized slaughter for over thirty years.

3) The International Fund for Animal Welfare (IFAW)-Provided funds towards

protection on polar bear trophy hunting. Campobello whale hunting and marine rescue.
Dedicated to improving welfare of wild and domestic animals by reducing commercial
exploitation, protecting wildlife habitats, and assisting animals in distress.
4) 4 Paws Ability-Sponsored a dog's training, so it could be placed with a young child. A
mission to enrich the lives of people with disabilities by the training and placement of
service dogs to provide individuals with companionship and promote independent living.
5) Reach for the rainbow-Help provide equipment to disabled children, it develops
integrated opportunities that enrich the lives of children and youth with disabilities, their
families, and the communities in which they belong.
6) Homeless Garden Project-provides job training and transitional employment to people
who are homeless in Sta. Cruz County.

7) SARS-The Small Animal Rescue Society of B.C. is committed group of volunteers

dedicated to the rescue, rehabilitation of homeless or unwanted small animals throughout
the province.
8) Odd Squad Production Society-sponsoring a documentary on gangs and guns
documentary and school education program.

9) Camp Summit-aided in sending 12 under privileged campers to camp-Squamish BC.

10) Camp Goodtimes (Canadian Cancer Society)-is summer camp program directed at
providing camping experiences for kids, teenagers, and families living with cancer.

Lush takes a consultant-based approach to sell their products; their associates are
expected to give each customer at least five product demonstrations per visit. They are
also asking customers about the skin and hair type so that they can recommend the right
product and to give a very good experience for the customer. Lush has developed more
interactive format for their customer and get a free consultation of their skin.