Sodashi: Natural Skincare And Organic Beauty Products From Australia

Introduction to Sodashi

Discuss about the Knowledge Base Representing Porter Five Model.

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Sodashi is a private company which was founded in the year 1999 headquartered in North Fremantle, WA. It occupies nearly 11-50 employees and the company deals with the products such as Natural Skincare, Organic, Spa, Beauty, Cruelty free and Skin care products. Sodashi helps to nourish skin at many levels. It is related to total health which helps to nurture physical body, the soul, the senses, the mind and spirit. Sodashi is very safe for the early and teen age daughters as well as for those who are suffering from the bad effects of time. The products offered by the company aims at satisfying the senses, mind, body, soul and emotions at very high level. It helps to transform and reawaken the skin with joyful feelings. Sodashi has successfully proved itself in terms of its products and the services provided. It has created a rich heritage and offers best experience with unique and valuable products (Sodashi, 2018).

The main objective of the company is to nurture and rejoice every person’s unique beauties and whenever one uses the product of Sodashi, it creates a reminder that you is beautiful and you will appreciate yourself that you are earnest of a nourished life.

Sodashi signifies unity, wholesomeness and happiness. With unity, the company seeks to nurture the needs of skin, with wholesomeness, it commits to blend the pure natural ingredients and with happiness, it seeks to offer beautiful skin. Sodashi always takes a holistic approach that beautify not only skin but mind, body, soul and spirit (Sodashi, 2018).

Political Factor: Since the company is planning to operate in the Malaysian market. The political issues related to Malaysia are very strict and it also include corruption. Malaysia is a multi-party democratic country and the Ruling Barisan National Party has the power since 25 years which state that the country has high degree of stability and Sodashi must think before investing here. Apart from this, according to Corruption Perceptions Index, Malaysia is ranked 47th out of 180 countries in terms of transparency (Gupta, 2013).

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Economical Factor:  Malaysia attracts lots of companies to invest there because of the vibrant economy structure of the country. During the last 10 years, the average economic growth is 7% per annum which shows the great opportunity for the companies. Due to rising economy, the income has also increased and so as the demand of the customers. So, Sodashi will have good opportunity to generate huge profit margin from the country. The total GDP of Malaysia concludes 37% of export transactions.

Political, Economical, Social, Technological, Legal and Environmental Factors Affecting Sodashi in Malaysia

Social Factor: There are majorly three groups of people living in Malaysia i.e. Malay (60%), Chinese (30%) and Indian (10%). It shows that the country have rich culture and this can create a better option for the company to attract many cultures and their people as well. The people of all the cultures will have broad perspective towards their skin which will benefit the company (Eze, Tan and Yeo, 2012).

Technological Factor: Malaysia needs to develop technological enhancements as compared to its competitors from the international markets. The country also wishes to enlarge world leading ICT companies. Government provides high level of technological support to the country which makes it the most attractive place for the other companies to start a business over there. Thus, Sodashi will also have the support if it wishes to enter Malaysia.

Legal Factor: The whole system of Malaysia is totally dependent on the British common law which can prove to be a major advantage for Sodashi because of some common laws existing in two countries. Apart from this, those who break the law are highly penalized such as death and flogging. So, the company must be aware of it while investing in Malaysia.

Environmental Factor: The environmental costs in Malaysia is very high because of the speedy development. During 2000, the country lost average 140, 200 hectares of its forest area per annum which denotes that the company may face several environmental issues if it plans to operate in Malaysia (Hassali et al., 2015.).

The major competitor of Sodashi are Coco Bio, Cos nature, Sukin and Tahiti organics. These companies offers herbal skin care products to its competitors and create a competitive advantage in the market. The major strategy followed by these competitor is price penetration strategy. They also offers try and buy services to their customers where customers are given an opportunity to try the products and once it suits their skin, they tend to buy them.

The bargaining power of supplier is very low for the company when it plans to introduce business in Malaysia. Here, the suppliers aims at increasing the prices of the product and diminish the quality of the product. It also include minimizing the availability of the products. The company will have to boost the price because of the low availability of the products. Additionally, the suppliers of the products should also majorly focus on the profit margin rather than focusing on other factors (Ogutu, 2015).

Competitors and Market Strategies

The bargaining power of Buyer is high in Malaysian market when it comes to cosmetic and skin care companies such as Sodashi. The buyers will have several options to switch from one seller to another seller and they will tend to buy products with high quality and low price. As per the Malaysian market, the supplier of the skin care products are too high and this will give an opportunity to the buyers to negotiate and bargain. This will also create huge number of options available to the buyers as well (Ho, 2014).

The threat to new entry is medium according to the Malaysian market because there are no such rules and regulations that must be strictly followed in Malaysia. The new companies can easily enter the new market of Malaysia and follow some laws and policies which helps a company to enter the new market (Tehrani and Rahmani, 2014).

There are huge number of alternate products which can be used as a substitute. Sodashi offers skin care products and when it comes to Malaysian market, there are numerous of skin Care Company who offers large number of products. So, it is very difficult to capture the market of Malaysia and build its image in the mind of customer (Damodaran, 2010).

The number of competitors in the Malaysian market in terms of skin care products is medium. There are competitors who can easily give a tough competition to the company named Sodashi. Apart from this, the company needs to differentiate its products to gain a competitive advantage in the market. There are large number of suppliers who offers skin care products and they earn huge profit margin as well. So, under such circumstances, Sodashi must be able to offer better products which will be chosen by the people living in Malaysia (Arons, 1999).

The SWOT analysis of the company under the Malaysia market is given below.

Malaysia has a quite good labor skills who tend to offer the high quality of products to its customers.

The laws and policies of the Malaysia can be a major advantage for the company.

Malaysia offers high technology products and services which can create an opportunity to the company to serve a digital platform as well.

The company might face the issues related to environment factors because of the rapid development of the country which automatically creates development cost along with the environment costs.  

SWOT Analysis of Sodashi in the Malaysian Market

Since the company offers organic products it will be an issue for the company to deal with its major competitors who offers huge products ranges.

The birth rate of the Malaysia is very low which creates low customers for the product in the market (Kottier, 2017).

Sodashi will have an opportunity to sell organic products to its customers in Malaysia because people living there tend to invest maximum in organic products.

The online platform in Malaysia is growing rapidly which can be beneficial for Sodashi as well (Valentin, 2005).

The ingredients required to build the product must be originated in Malaysia only because Malaysia offers strict trades laws with high penalties as well.

The total cost of the product may be high because of the unnecessary labor costs and other expenses as well (Gürel, 2017).

The company has collaborated with huge number of branded and well reputed hotels and introduced its stores so that the customers who used to visit such hotels had an eye on the company’s products and services as well. Sodashi distribute their products and services to the 5 star hotels of Malaysia and Singapore. The company ships their products to Malaysia and shipping price is measured during the checkout process prior to entry of credit card details. Sodashi aims at using the Australia Post International service.  The company has made a contact with malls as well where they distribute their products to the local retailers who sell their products to the customers (Malinen, 2013).

In addition to this, the company has also made the people living in Malaysia aware about the products sold by them and the people living there are happily adopting the products offered by Sodashi. The company offers huge range of products including organic and Ayurveda products which aims at attracting lots of customers who avoids chemical products. The population of Malaysia tend to invest maximum in health and skin care products which helps the company to gain huge profit margins (Mansor, Ali and Yaacob, 2010).

Sodashi adopts STDP strategy to capture the whole market and gain competitive advantage. STDP stands for Segmentation, Targeting, Positioning and Differentiation.

The demand of the customers keeps on changing based on their behaviors, life style and general characteristics. Segmentation is defining as the division of the entire market into groups based on their lifestyle. The company has mainly segmented its products and services based on the age group and their life style. The company aims at delivering products majorly for women who aged between 16-50 years of age with complete organic products (Janiszewska and Insch, 2012).

Segmentation also includes the accessibility of products to the customers. Since, Sodashi is a well reputed brand and it has collaborated with huge number of 5 star hotels, the customers can easily find its products available in the market. In addition to this, the company also serves a digital platform to its customers where they can but their products as per their requirements. In addition to this, the company has also aimed at segmenting its products internationally. The company has successfully build its image in the mind of customers and the customers are highly attracted towards the brand. Moreover, the segmentation can be done based on the demographic measures, psychographic measures, geographic and behavioral measures. Sodashi majorly aims at segmenting people living in Malaysia, Singapore, Japan and Thailand. And people who believe on using organic products are segmented by Sodashi and they have a mindset of enhancing their beauty by using such luxury products (Bose, 2012).

Targeting is also one of the major strategy adopted by every company who wishes to earn good profit margin for their business and firms. The target market segments usually include the total growth and size of the market, attractiveness of structure, and main objectives and goals of the company and its overall resources. Target market is generally selected and chosen based on its type’s i.e. undifferentiated marketing, differentiated marketing, niche marketing, micro marketing and individual marketing. When it comes to Sodashi, the company has its business transactions in Malaysia as well, the company has majorly targeted the females and teenagers who aged between 20 years to 50 years of age. The company have majorly focused on the teenage daughters who have faced the serious issues related to skin and its impacts. In addition to this, the product offered by the company not rejoice the skin but it also creates a satisfaction of body, mind and soul which makes it more attractive towards females. Today, it is generally seen female are free to invest in organic products and they tend to invest more in such products which can be great advantage for the company (Ingenhoff and Fuhrer, 2010).

Differentiation of products plays a very major role for any business to establish its name and gain a competitive advantage in the market. There are several differentiation strategy which are generally adopted by the company to attract maximum of its customers. Similarly, Sodashi also focuses on the differentiation strategy which is followed by it and which has successfully been implemented to collect more number of customers towards it. Differentiation can be found in terms of product features, quality, performances, design, and consistency. In addition to this, service differentiation also plays a significant role which include easiness in delivery, and quick easy return policy. Sodashi offers the product differentiation in terms of quality. The company offers organic products and it not only satisfies the skin but also body, mind and soul. The main objective of the company is to nurture and rejoice every person’s unique beauties and whenever one uses the product of Sodashi, it creates a reminder that you is beautiful and you will appreciate yourself that you are earnest of a nourished life (Claessens, 2015).

The positioning of the product is the way and methods by which the products and services is represented to the customers which is based on important attributes such as place. For an instance, Audi is positioned as a luxury car. Sodashi has already positioned itself in the market as well as in the mind of its customers because of the products offered by the company. The company has successfully captured the market of several countries including Malaysia, Singapore, Thailand and Japan. In addition to this, the company has also created a product value in the market by offering huge number of nature products which can be widely used by every age group of females. The company and its products signifies purity and wholesomeness which denotes the real asset of the company and also aim at attracting huge number of customers towards it (Gnepa and Cordeiro, 2011).

Thus, the STDP strategy followed by Sodashi has helped the company to gain more number of potential customers and also create a huge competition in the market in terms of organic products as well.

The product strategy of the company is usually defined as the Head of the product. The product strategy defines how the product management will support the company or any business in order to gain the objectives and mission of the company along with its goals (Shimon., 2016). The products offered by Sodashi is shown in the diagram given below:

Figure: Products offered by Sodashi

Generally, it happens that the product strategy is determined by the demands of the customers towards the particular products in any company or businesses. It is created by the company and served to the customers with a motive to gain huge profit margin. Sodashi aims at delivering skin care products and services which includes spa creams and fragmented oils majorly found in Malaysian market. Thus, when a company tries to introduce a new product in the market, it must know the demands of the particular products in the market, the need of the customers towards the particular product, the type of competitors who offers substitute products in the market, the branding and packing of the product and many more. The product strategy plays a very significant role in the company because if the company fails to attract the customers towards its product, then the company can no longer exists in the market (Omsa, Abdullah and Jamali,  2017).

In addition to this, the company offers 100% organic products which is rarely found these days. The company offers purely natural product to its customers which creates a very limited competition in the market. Apart from this, Sodashi also disclose its full label of ingredients to its customers which creates positive impact of the company because generally customers are very curious to know about the core ingredients especially when it comes to any skin care products. The company mentions all of its ingredients details on the product itself which helps in creating a positive feedback from the potential customers. In addition to this, Sodashi also focuses on marinating a healthy relationship with its customers by making their product easily accessible to them which makes them more happy and satisfied towards the product.

Pricing strategy is defined as a tool which is usually adopted by the company to manage the needs of total revenue permitting for reliable identification of the outcomes of pricing decisions and promotional activities of the sales data. This strategy helps the company to predict the effects of pricing and promotions on the actions of its major competitors and analyze the best pricing strategy among many.

One of the most factor of marketing mix is Price. There are huge number of companies which aims at advertising their products and services without any cost i.e. they serve complimentary goods. Nevertheless, this do not mean that price is at all important aspect because it is generally believed that products with lower price will have a special preferences for the customers. Price of the product always represent the value of the particular product. The customers always prefer the best product which totally depends on the value which it generates. The value includes the personal preferences, economic conditions, past experiences and many more. For an instance, the customers of Sodashi prefers buying the product at any cost no matter how high the prices are. This is because of the trust and faith that the company have achieved by delivering the best products to its customers. The company always prefer quality over price which is a great symbol of the customer satisfaction. The price of the product must determine the value of the product, the sensitivity of the price, competitors pricing policy, offers and discount options and consumer tradeoffs. In addition to this, the company prefers to choose penetration pricing strategy majorly found in the Malaysian market. Penetration pricing strategy is that pricing strategy where the price of the particular product is set low at the very first stage and when it captures the market, the price is slowly increased. This pricing strategy initiate words of mouth. The main aim of such strategy is the belief that the customers will automatically switch towards new brand because of the lower price as compared to its competitors. The price of the Sodashi product usually starts from AUD $75.00 which is easily affordable by its customers and it ranges up to AUD $400.00 (UTS library, 2012). Since the company provides the online digital platform where one can easily buy the products suing online payment methods. Other payment methods includes cash where the customers prefer physical location of the products (Jamaluddin and Dickie, 2011).

Place is generally defined as the location from where the product is sold to its customers. Sodashi offers huge range of platform for the better access of the products to its potential customers. Sodashi offers digital platform as well as physical platform of the products to its customers. The place strategy includes the channels of the distribution, Salesforce requirements and distribution channel of the competitors.

Sodashi sells its products by collaborating with 5start hotels and spa saloons where they can easily sell their products offered by a well reputed brands of hotels. Its offers products at local, national, international, travel and spa salons. The company distributed and endorsed in leading spas across the world (Išorait?, 2016).

Sodashi had no such budget for advertising and ad-hoc approach to public relations. Sodashi aims at communicating its customers more strategically by using wider audience. With the help of strong product offer and successful business strategy, the company has promoted itself in terms of huge success and also brought itself to the next level. With important business announcements in the pipeline, it was a real time to grow the presence of Sodashi in the media by introducing a targeted domestic media relationships programs. Development of a range of media materials includes backgrounders, key messages, executive biographies, hero products, product profiles and a series of themed media releases. The Media coverage in 2007 till 2008 concluded 38 clippings which was estimated with the value of nearly almost $900,000, a return on investment of approximately $89,000 (Business chicks, 2018).

Conclusion

Thus, from the above report, it can be summarized that Sodashi aims at satisfying the senses, mind, body, soul and emotions at very high level by providing best skin care products. It helps to transform and reawaken the skin with joyful feelings. Sodashi has successfully proved itself in terms of its products and the services provided. It has created a rich heritage and offers best experience with unique and valuable products.

References

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Bose , T. K., 2012. Market Segmentation and Customer Focus Strategies and Their Contribution towards Effective Value Chain Management. International Journal of Marketing Studies, 4(3).

Business chicks, 2018. How to cultivate engaged employees. . [Online] Available at: https://businesschicks.com/sodashi-megan-larsen-engaged-employees/ [Accessed 30th May, 2018].

Claessens, M., 2015. The Markting Strategy: Segmentation, Targeting, Positioning & Differentiation.. [Online]
Available at: https://marketing-insider.eu/marketing-strategy/
[Accessed 25 May 2018].

Damodaran, A., 2010. Measuring country risk.

Eze, U.C., Tan, C.B. and Yeo, A.L.Y., 2012. Purchasing cosmetic products: A preliminary perspective of Gen-Y. Contemporary management research, 8(1), p.51.

Gnepa, T. J. and Cordeiro, W. P., 2011. strategic entrepreneurship management competency and firm success: a comparative study of smes in makeup in thailand. International journal of business strategy, 11(2).

Gupta, A., 2013. Environment & PEST Analysis: An Approach to External Business Environment. International Journal of Modern Social Sciences, 2(1), pp. 34-43.

Gürel, E., 2017. Swot analysis: a theoretical review. The Journal of International Social Research, 10(51).

Hassali, M.A., Al-Tamimi, S.K., Dawood, O.T., Verma, A.K. and Saleem, F., 2015. Malaysian cosmetic market: current and future prospects. Pharmaceut Reg Affairs, 4(155), p.2.

Ho, J. K.-K., 2014. Formulation of a Systemic PEST Analysis for Strategic Analysis. EUROPEAN ACADEMIC RESEARCH, 2(5).

Ingenhoff, D. and Fuhrer, T., 2010. Corporate Communications: An International JournalPositioning and differentiation by using brand personality attributes. Corporate Communications: An International Journal, 15(1), pp. 83-101.

Išorait?, M., 2016. Marketing mix theoretical aspects. International Journal of Research Granthalayaah, 4(6).

Jamaluddin, A. and Dickie, C., 2011. Decision-making related to business growth: Malay small businesses in Selangor. International Journal of Business and management, 6(10), p.284.

Janiszewska, K. and Insch, A., 2012. Th e strategic importance of brand positioning in the place brand concept: elements, structure and application capabilities. Journal of International Studies, 5(1), pp. 9-19.

Kottier, W., 2017. Marketing strategy for online SMEs. [Online]
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Malinen, M., 2013. Strategic marketing planning for a b2b high-tech manufacturer. [Online]
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Mansor, N., Ali, D.E.B.M. and Yaacob, M.R., 2010. Cosmetic usage in Malaysia: understanding of the major determinants affecting the users. International Journal of Business and Social Science, 1(3).

Ogutu, F. M. M., 2015. Porter’s five competitive forces framework and other factors that influence the choice of response strategies adopted by public universities in Kenya. International Journal of Educational Management, 29(3).

Omsa, S., Abdullah, I. H. and Jamali, H., 2017. Five Competitive Forces Model and the Implementation of Porter’s Generic Strategies to Gain Firm Performances. Science Journal of Business and Management, 5(1), pp. 9-16.

Shimon., A. K., 2016. Brand and Marketing Mix-A Review. Journal of Global Economics, 4(3).

Sodashi, 2018. Our Story. [Online]
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[Accessed 25 May 2018].

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[Accessed 25 May 2018].

Tehrani, M. B. and Rahmani, F., 2014. Evaluation Strategy Michael Porter’s five forces model of the competitive environment on the dairy industry (Case Study: Amoll Haraz Dvshh dairy company). American Journal of Engineering Research, 3(5), pp. 80-85.

UTS library, 2012. Bringing Sodashi to the World. [Online] Available at: https://www.lib.uts.edu.au/gta/14216/bringing-sodashi-to-world [Accessed 30th May, 2018].

Valentin, E. K., 2005. Away With SWOT Analysis: Use Defensive/Offensive Evaluation Instead. The Journal of Applied Business Research –, 21(2).

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