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carnational marketing expansion Natura's inter in cosmete proti underbas w we of me The company produce und sa Brazilian company spe products. Since its creation the basic marketing concept of the boon to use natural ingredients from y ty in order to give em estar bem' ('Well-being well any produces and markets a portfolio portfolio 000 products positioned in the beauty e premium segments, including ances, hair care, men's groom care sun care, bath and shower color and child-specific products. Nat direct sales organization (DSO) for ution of its products, relying on around representatives taken from a pool eager to earn commission for a living of The t w o Chan 1983, with more due party tive constraints and party to the low acceptance of the direct sales sector. Other countries from Latin America - Argentina Bolivia Medco and Peru - were the next candidates for internationalition By 2004 Natura's International sales repro sented 2.5% of total sales short of its objective of 33% Natura management considered that it was important to develop outside Latin America and particularly in the major countries of North America, Europe and Asia At first the following targets were considered the USA, Western Europe and Japan China was left for a second wave of future expansion (see table below) and personal Care deodorants fragrane de til baby and endorsed a dire the distribution 100,000 sales repres of women eager to an Cosmetics, fragrance and toiletry products ICFT) in 2004 USA France Total sales is billions, 2004) Spain 7 er billions, 2004) th rate average 2000-2004 Germany 12 0% 0% 14 3% 3% UK 12 1% Italy 10 0% 46 -1% 9% 160 7% 170 230 150 160 Direct sales ) Per capita expenditure of CFT ($) Average price/unit ISI Leading competitors 5.1 5.9 200 5.1 L'Oréal Unilever, P&G L'Oréal, P&G L'Oréal Unilever L'Oréal Unilever L'Oreal P&G L'Oreal, Unilever USA Largest market in the world with intense com- petition. Already home to the two largest direct sales competitors, Avon and Mary Kay (4% and 3% respectively). The cost of entry is tremen- dous. Consumers appreciate European products, which are perceived as sophisticated as the most sophisticated and innovative mar ket. French registration, safety and packaging regulations are costly. • Germany: The main trend of the market is towards health and wellness products. Direct salos marketing is not well developed • UK: This is the highest growth market in West- ern Europe, especially for premium products. • Spain: More women are entering the workforce and increasing disposable income contributes to increased demand for luxury items. • Italy: Mass market products perform better than premium products Western Europe Five countries dominate the Western European market: France, Germany, UK, Spain and Italy. It is considered that the Western European market is the most sophisticated for cosmetics. There- fore it is important for a company considering being a global player to establish a presence in this part of the world. France: This is the most important market in Western Europe. It is a mature market leaning towards the premium segment. It is considered Japan Japan is a fast-growing cosmetics market. There is a shift in demand towards anti-ageing prod- ucts and Japanese consumers tend to favor Japanese brands.

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