Coty Inc. Marketing Proposal

COTY’S MARKETING PLAN
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Coty’s Marketing Plan
Social Media Marketing- BUS 297D
December 16th, 2017
Attri Farahzadi
San Jose State University
Lucas College and Graduate School of Business

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Table of Contents
Business Recap 3
Target Market 5
Current Target Market 5
New Target Market 6
Current Advertising 6
Youtube Subscribers 7
Instagram Followers 8
Facebook, Twitter, and Linkedin 8
New Advertising 9
New Ad Proposal 9
Experiential Marketing Proposal 10
Mobile Applications 11
Billboard Design 11
Brand Strengthening 12
Competitor Marketing 12
Unilever 12
L’Oreal 14
Timelines 15
ROI 16
Academic Recap 16
References 17
Appendix 21
Coty’s SWOT Analysis and Target Markets 21
Coty and Competitor Social Media Presence 22
Competitor Financial Information: Unilever’s Marketing Budget 22
Unilever #SpeakBeautiful Social Media Marketing Campaign 22
Maybelline Traditional Marketing 23
Competitor Financial Information: L’Oreal Marketing Budget 23
Youtube Subscribers and Instagram Followers 24
New Advertising 25
Mobile Applications 26
Billboard Design 27
Timeline 28
Coty’s Marketing Cost and Net Revenue 28
ROI Calculation 29

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Business Recap
Coty, the third largest beauty company in the world, has an iconic portfolio of more
than 77 brands across fragrances, color cosmetics, haircare, bodycare, and skincare. With
agreements between global companies like Unilever Cosmetics International and Procter &
Gamble's (P&G), and acquisitions of influential brands such as OPI, Coty is expanding and
growing quickly in the industry. Coty hold the number one, two, and three positions in
fragrances, haircare, and color cosmetics respectively. Below is a brief company SWOT
analysis based on Coty’s current state. (See Appendix)
Strengths
Coty has a highly balanced leadership team consisting of experienced and diverse
executives from Coty, P&G, and external hires. Each division (luxury, consumer beauty,
professional beauty) has its own team responsible for the end to end consumer experience
while making decisions based on the consumer’s best interest. This structure makes us to be
more category-focused and consumer-centric. Additionally, the broad scale of the company
allows us to aim to multiple targets and our powerful brands have a long standing good
reputation around the world, which accounts for most of our net revenue.
Weaknesses
While our sub-brands are well known in the industry, our brand “Coty” is not
recognized by consumers. We need to develop more brand awareness and gain loyalty from
current power brand consumers, in addition to leveraging the same audience to introduce new
sub brands into its product mix.
As a global company, foreign currency contracts and exchange rates often influence
our revenue. For example, in fiscal 2016, we suffered net income reduction of $75.6M dollars
($232.5 to $156.9) primarily due to loss on foreign currency contracts and locking in an
exchange rate for the sale of their products at a future date and not requiring any upfront

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payment.
Another weakness to be addressed is “Continuously changing distribution channels”.
The trend towards consolidation of stores in the retail industry such as Macy’s, JCPenney,
and Sears, as noted by TIME, has been detrimental to us over the past few years and
continues to be a problem that results in less stores selling our product. This also gives more
control to key retailers who now have a higher percentage of retail locations and control of
distribution channels, which have increased their bargaining strength. We expect that we’ll be
able to solve this problem and expand our distribution channels through our acquisition of
P&G brands.
Opportunities
The rapid growth in beauty industry provides Coty with the best environment to
expand our business. In 2015, U.S. prestige beauty industry reached $16 billion which was a
7 percent increase over 2014 sales.
Also, the use of the internet, beauty applications and mobile purchases have grown in
the beauty industry. As millennials become the main consumers, places such as websites,
social media platforms, Youtube, blogs, and mobile apps are primary engine for exposure and
marketing. Consumers heavily rely on “word of mouth” through all these social media
platforms. They use beauty applications to virtually try on products and analyze their own
skin, and purchase products. As a result, building and maintaining a strong presence in social
media platforms is crucial to capture the most engaged consumers. We are looking forward to
develop more in these areas.
Threats
Although the industry is growing rapidly, there are some threats that we still need to
face. The change in tastes among consumers is slowly appearing. Consumers tend to take

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more interest on organic and natural products. With the new cosmetic regulation and anti
make-up movement, we need to be on top of these trends as well.
Also, as mentioned earlier, E-commerce has been growing recently. Yet, we are really
weak in this area compared to our competitors.
Target Market
Current Target Market
Because we have many sub-brands, there are many segments that Coty targets. Our
“power brands” enhance the three beauty segments that we compete in and ultimately receive
the most money from the marketing budget. Examples of these power brands include,
Rimmel, OPI, Philosophy, etc. Although each sub brand has their own target market,
generally we target both male and females consumers across all incomes, ages, and
geographic locations. Therefore we will use OPI as our marketing plan example. Given that
the OPI use case proves to be successful, we would like to approach to our other brands with
the same strategy.
OPI targets women between 22 and 32 years of age who are fashion forward, social
butterflies, and care about their body image. They are typically middle class (post bachelor
graduates) with an annual income between 42K and 125K. When it comes to shopping, they
are willing to try different new products, rely on word of mouth, follow youtubers, bloggers,
and celebrities. The media they use are Instagram, Facebook, Youtube, Mobile applications
and online shops. (See Appendix)
New Target Market
We believe that this main group is the perfect primary target market for us at OPI.
Yet, besides the main target market, we also looked at secondary and tertiary target markets.
(See Appendix)

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One group is women who age 33 to 45. The differences between this group and our main
target market is that they are more confident with their job status; price won’t be the main
consideration for buying decision, and instead of heavy use of diverse social media platforms,
they tend to use fewer platforms such as LinkedIn, Facebook and Youtube and spend more
time with mobile applications and fashion magazines. The other group is young high school
or college girls. Their spending allowances come from their parents or part time jobs, so price
will be their biggest consideration. This group of girls tend to be popular, cute, and fancy
among peers. They are heavily social media users. (including Snapchat, Instagram, Facebook,
and Youtube)
Current Advertising
Currently Coty is not involved in traditional advertising of any of its power brands.
We had studied current marketing strategies of OPI and have applied different approaches to
Cotys marketing plan.
OPI has teamed up with various celebrities in order to sell their products to a specific
niche. The collections are named after the artist and expresses their work and personality.
Justin Bieber, a Canadian singer, was one of the first to release a celebrity nail polish
collection for OPI followed by the Kardashian klan and Nicki Minaj.
Youtube Subscribers
Coty Inc did not have any active Youtube pages for this we had considered OPI as a
case and proposed improvements to Cotys Youtube page.
OPI has 36K Youtube subscribers, which is very low for a top brand. We had
compared OPI Youtube page with local Youtube page of Cutepolish, whose freelancers that
represent Cutepolish have more than 1M subscribers. This Cutepolish provides nail designs,
nail art, and usage of different types of nail polish for nail designs.(See Appendix)

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OPI has recently posted our Spring 2017 collection of American fashion designer,
Jeremy Scott before a nail design fashion show. This show includes an amazing video shoot
that covers the nail designs of models before the catwalk, but OPI could only pull the
attention of 1,200 viewers when the video was posted on Youtube. This indicates the right
content is not posted at the right place in the right way. In this to attract our viewers, we need
to create videos that have more impact and gets our target markets attention. For example,
naming the video as “How to get nails designs like a model” would have attracted more
users.
Recently OPI released the Washington DC collection endorsed by Kerry Washington.
The OPI official page and Youtube ads for this collection do not have much information
provided about product description except for the videos and images of new nail polishes. In
contrast, a video posted by a freelancer on Youtube clearly explained the 12 polishes within
the collection, how it appears on 1st coat, 2nd coat and how to use various colors for various
designs. The detailed videos posted on Youtube have attracted more viewers than the OPI
videos.
Given these three cases, we propose to create an official Youtube page for the Coty
brand. The page will consist of three sections: color cosmetics, fragrances, and
bodycare/skincare. In these respective sections, we plan to post information on newly
launched products and their advantage over existing products The user content posted should
be more related to consumers versus showing skinny women videos showing off their
makeup.
Instagram Followers
OPI has 1M Instagram followers compared to Nailartclip’s 2.2M followers and
Nail.artists 3.7M followers on Instagram (See Appendix). The key difference is that OPI does
not post any user participation content. Most of the content is related to product display.

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Given this information, we propose to improve Cotys Instagram page by posting
pictures related to its product usage. For example, in the case of its Wella Professional hair
products, we will post short clips related to how to create different types of hairstyle designs,
each having a 20 second clip. Moreover, we will continue this method with OPI and other sub
brands and post how to nail design videos that again, last between 20-30 seconds. These short
clips will accommodate to our target market and the decreasing attention span of users who
don't want to spend a great deal of time looking at how to videos but instead, strictly getting
to the point.
Facebook, Twitter, and Linkedin
OPI has good presence on Facebook and Twitter consisting of 1.8M and 293K
followers while Coty USA has 13K followers on Facebook, 10K followers on Twitter, and
surprisingly 115K followers on Linkedin (See Appendix). Coty posts information about its
mergers and acquisitions actively on Linkedin , which has resulted in Coty’s 115K followers
on that platform.
Given the above information, we should improve in a similar way with our Facebook,
Twitter and Linkedin pages focusing on posting consumer interest based content and
continuously updating news on acquisitions and mergers.
New Advertising
Emotional marketing plays a key role for big brands. Since Coty wants to compete for
consumers through emotional engagement, they need to invest in emotional storytelling.
Reinforcing and nurturing an emotional context within consumer minds in every aspect of
their content strategy is essential.

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New Ad Proposal
A working women starts typing a document on her desktop. While typing she looks at
her fingers (stops typing), and shows an expression of sadness and low confidence, indicating
that she feels she is not beautiful. When she goes home, her roommate gives a surprise gift to
her. When she opens the gift, she finds a set of OPI nail polishes.When her friend starts
putting nail polish on her nails, she tells her friend that she does not like the nail polish but
her friend insists and applies the nail color on her fingers. The main character and her friend
will both have matching designs on their nails and starts taking selfies to post on social
media.
The next day when the women starts to work at her office, she feels herself more
confident because of her beautiful nails. She even prepares her office reports on time and
receives positive recognition by her boss.
Once the women is appreciated by her boss, she feels more confident about herself.
After this scene, we close the commercial with a caption that says, “OPI by Coty - “It’s not
just a color, but it’s confidence added to your day” (See Appendix).
Experiential Marketing Proposal
To emotionally get connected to consumers we propose the marketing campaign,
Explore the beauty inside you. The concept of this campaign is to make women feel beautiful
and confident by creating an emotional relation with our brand.
We are also proposing a simultaneous campaign in 25 states in the USA where we
choose 4-5 women between the ages of 20 to 30 from population dense states like California,
Texas, New York, Florida, etc. We invite these women to our shooting room in each
respective state. First we will tell them to close their eyes and make them think that we are
putting makeup on their faces and during this entire process the participants are not allowed
to use mirrors. In reality, we will not apply any make-up to their faces but instead, we will

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use plain brushes with fragrances to create the perception among the participants that we are
really applying makeup on their faces.
After the process is done for 35 minutes, the participants will open their eyes and we
will tell their family or friends to tell them that they look fabulous with this makeup (when in
reality we did not put any makeup on). Now the women are given clear instructions that they
are not allowed to use mirrors for the rest of the day and we will follow them to their work
secretly shooting the video. We will see that the participants behave more confidently after
they are praised by their friends and family, and would carry that confidence to their
workplace or whatever environment they plan to go to after the “makeup session”.
At the end of the day, we will speak with our participants about how they are felt after
the session. We anticipate participants to share feedback that they felt happy because they felt
beautiful and confident. Then we reveal the truth behind the experiment and tell the
participants to see their beauty in mirror and find themselves that there is no makeup. All the
participants laugh and we explain them that the real beauty is your confidence and you need
to explore that beauty inside you.
After this campaign, we will post the consolidated video of these people tagging them
as Miss. Coty California, Mrs. Coty Washington etc., on our official pages on Instagram, You
tube, Vimeo, Twitter, Linkedin, Snapchat, and Photos at Pinterest. This campaign will be
extended further to all the states to show all these different women feeling naturally beautiful
and letting them to post their official pictures on Instagram and Facebook once they find
themselves on our social media platforms. Our Coty team will be actively participating with
them by continuously replying to the pictures posted. During the execution of the marketing
campaign we will also plan for future campaigns that tie into the same messaging as the
Explore the beauty inside you campaign.

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Mobile Applications
To be available to provide information on each and every sub brands we release, Coty
should be available to customers at the touch of a button. For this reason, we are proposing a
mobile application where we provide all the news related to our new product launches and
new acquisitions. All the Coty power brands products will have descriptions along with links
to power brands official websites. Customers are also given the opportunity to write reviews
of the product and provide any feedback for product improvement. Short tutorials on usage of
products and comparing new products with existing products will also be posted.(See
Appendix)
Billboard Design
With our new campaign, Explore the beauty inside you, we are proposing new
billboards available in different colors of Cotys butterflies. A women looking at our Coty
butterfly represent natural beauty and with our products, you can explore the real beauty
inside you. These billboards will be placed in urban city locations where we can attract a
large number of people. The main goal of these billboards is to create awareness among the
people about Coty brand. (See Appendix)
Brand Strengthening
With this new marketing strategy, we would like to humanize our brand and create an
emotional connection with our consumer. We want to reduce the relational gap between
consumers and Coty, and develop more interaction between them. Our proposed plans are
also created in a way that or marketing plans are more interactive rather than simply showing
our products in stylish way.

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Competitor Marketing
Coty’s top two competitors are Unilever and L’Oreal. While each are different in their
own way, all companies have historically invested in social and traditional marketing. A
common trend among Coty and it’s competitors is the growing pressure of digital technology.
Unilever
In 2015, Unilever, spent 8 billion dollars on marketing (See Appendix). While
consumer-led growth is generated through a variety of platforms, Unilever notes how social
media marketing through different platforms is essential to how they influence shoppers in all
stages of the decision making process. An example of this is illustrated through Dove’s social
media campaign where users posted the hashtag #SpeakBeautiful to bring awareness and
boost self-esteem on Twitter and Facebook while encouraging women of all ages to take a
deeper look into how online words can have a deep impact on self confidence (See
Appendix). In comparison to Coty, Unilever is ahead in their presence in social media,
specifically Facebook and Twitter followers yet behind in how much content is being pushed
online on behalf of their sub brands (See Appendix).
Unilever also focuses on traditional marketing. An example of this is the commercial
aired for Dove's campaign for real beauty which challenges current stereotypes about beauty
among women and men. More specifically, Dove asked mothers of all ages to describe
themselves as an artists drew a sketch of them. Little did they know, the same artist asked
friends and family of the mother the same questions and drew a picture that was more similar
to the actual appearance of the mother. The idea was to show how self critical women are of
themselves and to encourage positive body image and self esteem. In comparison to Coty,
Unilever is neither ahead nor behind of Coty’s traditional marketing. One space for
improvement that Coty can work on to remain competitive with Unilever is to be more

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transparent with their marketing principles on their website. Unilever has a webpage
dedicated to their marketing guidelines, what they value, and elaborates on responsible
marketing. This is something Coty has the opportunity to improve on. Additionally, Coty can
improve on tapping into the emotional side of consumers and leverage that to increase
awareness of their overarching Coty brand (See Appendix for billboard example).
Unilever is similar to Coty in that there are many popular sub-brands that represent
the overall Unilever brand in which some are power brands and each have their own way
advertising their products. Given this information, the best focus for comparison will be on
Dove as it’s similar to the power brands that represent Coty. Additionally, Dove has a target
market of women of all ages, shapes, and sizes, who come from middle and upper middle
class, and generally care about quality and reliability. These women typically lead busy lives
and want products that do the job in a timely manner.
L’Oreal
L’Oreal, Coty’s other main competitor and the world’s largest cosmetics and beauty
company, had a marketing budget of 7.4 billion dollars in 2015 (See Appendix), with the
majority of the budget spent on digital marketing. The most similar sub brand of L’Oreal that
can be compared to OPI is Maybelline. Their focus on thinking globally yet acting locally has
been reflected in the company leveraging social media marketing to have 61 different
YouTube channels across 39 different countries to appeal to all types of people to reflect the
one shade doesn’t fit all theme. L’Oreal focuses on different segments that make up their
target market and takes into consideration the cultural differences of all their target audience.
Examples of social media marketing for Maybelline includes how to videos on YouTube and
the #YoursTruly campaign that celebrates true match foundation accommodating over 98%
of the UK’s skin tones to promote diversity. In addition to L’Oreals Makeup Genius
application where users can virtually try on makeup, the beauty tips page, and the

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Makeup.com publication which sources all L’Oreal vlogger content that has over 900K social
media followers, L’Oreals main sub brand, Maybelline let freelance Maybellline fans, also
known as Babelline’s to post videos on how to apply Maybelline makeup so that it looks
seamless and natural.
Maybelline also continues to use traditional commercials, billboards, and print
advertising via magazine spreads (See Appendix). Recently, Maybelline came out with a
billboard that said “Never Fake it Again” and a magazine ad saying “Don’t mask me” to
promote natural beauty and accentuating one’s self with Maybelline makeup versus covering
up (See Appendix). This concept along with their natural, nude palleted commercials tie into
their overarching Maybelline tagline of “Maybe she’s born with it, maybe it’s Maybelline”.
Given this information, L'Oreal's primary target market (based on power brands relevant to
Coty’s such as Maybelline and Garnier) is women of all races between the ages of 16 and 40
who typically come from the middle class and care about their appearances and accentuating
natural beauty versus covering it.
When comparing Coty to L’Oreal, Coty trumps L’Oreal in social media marketing
strategies through use of different technical platforms however L’Oreal overtakes Coty in
online presence, especially on Facebook where L'Oreal has 24+ million followers versus
Coty who only has 13K followers on Facebook. (See Appendix)
Timelines
We divide our marketing plan into 4 sections in order to increase our brand awareness
step by step (See Appendix). The first step is to draw customers’ attention back to our social
media platform. Our Facebook page hasn’t been since October 2016 and the contents isn’t
relative to our customers anymore. Therefore, we will spend a month focusing on our fan
page by posting beauty related content and create a main Instagram platform as well. During

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this active month, we will also prepare for our new ads recording. After a month of intense
activity, we would like to release our new advertisement. This is a good time to release the ad
because by that time, we will have gained follower’s attention back to Coty.
The next step is to release our mobile application. Our mobile application integrates
different sections of products, which help customers know the different products under the
Coty name. When customers are using our application, they might increase interest in other
Coty products. At this point, they will be able to find out detailed information on our social
media platforms since we have already updated the information. The final step will be to
share our campaign and billboard. We believe that we will be able to catch more attention
through integrated communication.
ROI
The total cost for this marketing plan will be $368,460. This figure includes the cost
of the new advertisement (hiring a marketing team to make videos and paying additional
spend on Youtube and Facebook advertisement). By spending additional resources on social
media platforms, we will be able to target our target market. Campaign cost includes the gifts
for participants and video production. Billboard costs cover setting boards in 10 cities.
In terms of net revenue, the growth in 2016 net revenue of color cosmetic is 7%. Our
goal is that the net revenue will increase 10% after our marketing strategy. Therefore, it’s
estimated that our net revenue of the color cosmetic segment in 2017 will be $1702.25M and
the sum of the estimated marketing cost and the new marketing plan in 2017 will be
$1577.93M. We get approximately an 8% ROI. (See Appendix)
Academic Recap
We use the chapter of Social Community to find strategy connecting our original
followers from powerful brands with Coty. Also, by using this chapter, we get the strategy of

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using paid advertising to catch customers’ attention. The way we analyzed our Facebook
content was to refer to the Social Publish chapter in Tuten.
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Appendix
Coty’s Overall SWOT Analysis
SWOT Analysis
Strengths
● Leadership Team
● Strength and scale of the company
● Multiple Target Audiences
● Power Brand equity
Weaknesses
● Brand Recognition
● Foreign Currency Contracts
● Continuously Changing
Distribution Channels
Opportunities
● Rapid growth in beauty industry
● Internet impact on beauty industry
● Growth of beauty app
● Mobile purchase drives cosmetic sales
Threats
● E-Commerce
● Changes in Customer tastes
● New cosmetic regulations
● Anti make up movement
Coty’s- OPI Primary Target Market
Secondary and Tertiary Target Market

21
Coty and Competitor Social Media Presence
Competitor Financial Information: Unilever’s Marketing Budget
Unilever #SpeakBeautiful Social Media Marketing Campaign

22
Maybelline Traditional Marketing
Competitor Financial Information: L'Oreal Marketing Budget
Youtube Subscribers

23
Instagram Followers
New Advertising

24
Mobile Applications

25
Billboard Design

26
Timeline

27
Coty’s Marketing Cost and Net Revenue
ROI Calculation

Coty Inc. Marketing Proposal

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