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BA 656 – International Consumer Audit Paper: Tarte Cosmetics 1
BA 656 – International Consumer Audit Paper: Tarte Cosmetics
Jamie AngoveBellevue University
Dr. Okash
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 2
Table of Contents
Abstract................................................................................................................................4
Executive Summary.............................................................................................................5
Company Profile and Brand Overview................................................................................6
The Brand and the Product..................................................................................................7
Government and Political Landscape..................................................................................8
Economy............................................................................................................................10
Socio-Cultural Trends........................................................................................................11
Technological Environment...............................................................................................11
Environmental Climate......................................................................................................12
Legal Environment.............................................................................................................13
Market Segmentation.........................................................................................................14
Competition in the Market.....................................................................................15
Consumer Needs and Opportunities for Innovation..............................................16
Potential for Product Extension.............................................................................17
Product Position.................................................................................................................19
Pricing................................................................................................................................20
Distribution Strategy..........................................................................................................21
Promotional Strategy.........................................................................................................22
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 3
Cultural Values and Customer Satisfaction.......................................................................24
Conclusion.........................................................................................................................26
References..........................................................................................................................27
Appendix............................................................................................................................32
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 4
Abstract
This paper is focused on Tarte brand cosmetics and its ability to be positively integrated into the
English cosmetics market. A complete audit has been conducted to compare the brand
personality and positioning against English culture, norms and preferences. Research was
conducted on the English market as a whole, evaluating the governmental, economic,
technological and environmental climate. Tarte analysis has been conducted and proves a
positive match to English preferences and buying habits.
Keywords: Tarte, cosmetics, England, culture
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 5
Executive Summary
Tarte has been a well-known, preferred premium cosmetics brand in the United States
since the early 2000s. The brand has received positive feedback for its commitment to
responsible production and product sourcing as well as societal marketing. Recently, Tarte has
been introduced to the market through limited distribution, and it has been received with
enthusiasm. This paper will analyze English culture, current environmental factors, and the
attributes of the Tarte brand to prove it can be successfully expanded through additional
distribution channels in England.
Product
Tarte offers a wide variety of color cosmetics, all using ethically sourced and tested
ingredients and presented in chic, fashion-forward packaging. The English market has a strong
preference for premium cosmetics, and these consumers have demonstrated a strong demand for
the brand in their market (Partington, 2014).
English Environment
Larger metropolitan areas’ economies, where color cosmetics are in the highest
demand, are on the rise (PwC, 2015). Although unemployment is high, inflation is low, and the
economy is still recovering, the cosmetics industry remains strong (“Skincare industry profile:
United Kingdom,” 2014). The make-up industry had a market value of 2,110.5 million dollars in
2012 and is expected to grow to 2,660.2 by 2017 (“Make-up industry profile: United Kingdom,”
2013).
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 6
Company Profile and Brand Overview
Tarte cosmetics began in a small New York City apartment in 1999 with a vision of
providing better quality products made from natural ingredients (Newman, 2007). The
company’s founder, Maureen Kelly, demonstrates a passion for development through Tarte’s
wide expanse of products and colors, and Ms. Kelly has a special knack for marketing which can
be seen through Tarte’s chic, fashion-inspired packaging (Newman, 2007). The cosmetics market
has been shifting towards an eco-friendly, cruelty-free focus, but Tarte was ahead of the trend; its
products have been based on natural ingredients, superfruit infused products, a strict no animal
testing policy, and packaging devoted to reducing, reusing and recycling (Newman, 2007; Kelly,
2012). Tarte is a leader in the earth-engineered beauty market with a mission to promote “health
couture” cosmetics and educate women on the benefits of being beautiful on the inside and out
(Newman, 2007).
Despite wide growth and demand for Tarte cosmetics in the United States, the brand
was completely unavailable in England until 2014 (Partington, 2014). Cosmopolitan UK cited
Tarte as one of the top eight American brands English and United Kingdom women wished were
available in early 2014 (Partington, 2014). Later that year, QVC launched Tarte in England and
the United States Sephora online store began selling Tarte to English consumers (“Tarte lands in
the UK. Here’s what you need…, 2014). Tarte is unavailable for English consumers to touch and
test prior to purchase, targeting a very limited market of people most likely already familiar with
the brand.
While brick-and-mortar stores are becoming less important for many purchases, stores
like Best Buy have struggled with matching prices to online competition as consumers use its
showrooms to try out products before bargain shopping online. Cosmetics require the same “try-
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before-you-buy” opportunities for consumers, especially first time purchasers. Finding the right
color match for all-over foundation and a blush complimentary to skin undertones requires
consumers to test products in person. Tarte is still not available in this capacity to English
consumers today.
This paper will outline a proposal to integrate Tarte cosmetics into department stores in
England, highlighting the consumer need that will be fulfilled by widening the distribution of the
brand. England has a demand for Tarte cosmetics, and it is up to the company to optimize its
penetration into the English market by providing its products to consumers in an optimal
cosmetic-purchasing environment.
The Brand and the Product
Tarte designs cosmetics that are completely vegan, cruelty-free and mostly eco-friendly
(Kelly, 2012). Products include basics such as foundation and concealer, colorful eyeshadows,
lipsticks, cheek stains, and bronzers, eyeliners, mascara, and beauty brushes. Each of Tarte’s
cosmetics is sold in a uniquely designed, fashion-inspired package intended to project the
brand’s position of being trendy, chic, environmentally-conscious, and unique (Newman, 2007).
Tarte’s products are best described as prestige brands: the brand name, stylish packaging, and
high quality ingredients validate premium product pricing that customers are willing to pay. One
of Tarte’s best-selling products is its Amazonian Clay 12-Hour Full Coverage Foundation with
SPF 15, available in at least 24 shades to fit most skin tones. The product is priced at just under
40 dollars, compared to a drugstore brand such as Maybelline that costs six dollars.
Tarte is a cosmetics brand targeted at young women, estimated ages 20 to 30, with an
interest in environmentalism and making healthy choices. Consumers likely have disposable
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income or are willing to sacrifice on other luxuries in order to afford cosmetics they adore.
Consumers may be described as Bohemian; they are earthy, environmentally responsible and
support cruelty-free practices (Campo, 2013). Consumers do not want to be tied to a typical
“granola” image, and they are still conscious about the availably of various shades, product
performance, and overall packaging (Campo, 2013). It is these attributes that attract young,
image-conscious women to Tarte’s responsible-yet-fun products.
Tarte was sold to Kosé in April, 2014, with a guarantee that the brand would not change
its product or mission. Kosé intentionally held off on introducing the brand into its home
Japanese market due to a lack of brand presence in the country, an absence of anything similar in
the “high performance natural” cosmetics category, and an instinct that Japanese consumers
would not be drawn to the chic packaging that Tarte is well-known for (Wetherille, 2014).
Additionally, Kosé opted out of introducing Tarte into the Chinese market due to the company’s
strict “no animal testing” policy; China mandates that animal testing be performed on all
cosmetics (Wetherille, 2014). It is clear that Kosé is maintaining the identity of the Tarte brand
by making smart marketing decisions; however, the English market, ready to embrace Tarte, still
has a void in the availability of its cosmetics.
Government and Political Landscape
England is often grouped into the United Kingdom, sharing government, population
measurements, and statistics on demographics with the larger country which includes England,
Scotland, Wales and Northern Ireland. The country is governed by a constitutional monarchy
with its capital in London, England (Central Intelligence Agency, 2015). England itself consists
of 27 two-tier counties, 32 London boroughs, the City of Greater London, 36 metropolitan
districts, and 56 unitary authorities (Central Intelligence Agency, 2015).
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As a constitutional monarchy, the country is currently ruled by Chief of State, Queen
Elizabeth II alongside Prime Minister David Cameron (Central Intelligence Agency, 2015).
Prince Charles is heir to Queen Elizabeth’s throne. Monarchy is strictly hereditary, so heir to the
throne will always follow the current Queen’s bloodline (Central Intelligence Agency, 2015).
The prime minister is elected after campaigning as a leader of a majority party or coalition
(Central Intelligence Agency, 2015).
The United Kingdom’s constitution is unwritten, consisting partly of statutes and partly
of common law and practice (Central Intelligence Agency, 2015). The legal system follows a
common law organization and consists of a nonbinding judicial review of the Acts of Parliament
(Central Intelligence Agency, 2015). Citizenship is granted in the United Kingdom by descent
only, meaning one parent must be a citizen of the country (Central Intelligence Agency, 2015).
To become a naturalized citizen, one must live in residency for five years (Central Intelligence
Agency, 2015).
Several groups currently apply political pressures on government entities (Central
Intelligence Agency, 2015). The Campaign for Nuclear Disarmament supports non-violent
protest and encouragement for the British to disarm nuclear weapons (Campaign for Nuclear
Disarmament, n.d.). The Confederation of British Industry (CBI) promotes conditions to assist
U.K. businesses of all sizes in competition and prosperity (CBI, n.d.). By lobbying and
campaigning and through political access, the CBI provides market leading economic surveys
and forecasts, provides influential thought leadership, and guides business decision making by
providing strategic insight (CBI, n.d.). The CBI also assists in linking businesses to the right
people to create business opportunities for prosperity (CBI, n.d.). The National Farmers’ Union
often aids in making legislation and determining prices (Massey, 2012).
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Economy
The current Gross National Income in the United Kingdom is $43,430 (The World
Bank, 2015). Additional the Gross Domestic Product has grown to 2.9 as of 2014, but is
expected to decline to 2.2 by 2017 (The World Bank, 2015). Growth in the U.K. slowed slightly
in 2015, but lower oil prices assisted in keeping demand growth strong (PwC, 2015). Economists
expect that any global environment improvements would also lead to accelerated growth rates in
the U.K. (PwC, 2015). Larger metropolitan areas lead the current economy recovery growth,
averaging three percent in 2015 through 2016 in London and the South East (PwC, 2015).
Inflation has remained relatively low in the United Kingdom. In 2013 it was 2.6
percent, but has shrunk to 1.5 percent in 2014 (Central Intelligence Agency, 2015). The
unemployment rate, however, has increased in the same period of time: unemployment was at .6
percent in 2013 and increased to 6.2 percent in 2014 (Central Intelligence Agency, 2015).
While the overall economy is still under pressure, the cosmetics industry remains strong
and proves to be in good economic standing to support Tarte’s entry into the market. In 2013, the
skincare market in the United Kingdom was almost 2,813.6 million dollars, and it is expected to
increase to 3,174.1 million by 2018 (“Skincare industry profile: United Kingdom,” 2014). Facial
care is the largest segment of the skincare market, representing over 60 percent (“Skincare
industry profile: United Kingdom,” 2014). The make-up industry alone had a total market value
of 2,110.5 million dollars in 2012, expected to grow to 2,660.2 by 2017, see Appendix A
(“Make-up industry profile: United Kingdom,” 2013).
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Socio-cultural Trends
The entire United Kingdom population is 63,200,000, 84 percent of which is the
population of England, 53,000,000 (Office for National Statistics, 2011). Tarte’s target market is
women, ages 20 to 30. The United Kingdom’s population is 50 to 52 percent female: 2,084,000
females aged 20 to 24 and 2,188,000 aged 25 to 29 (United Nations Statistics Division, 2015).
The mean age for females to marry in the U.K. is 27 (United Nations Statistics Division, 2015).
The education level for women in the U.K. as of 2012 is seventeen, while the overall education
level is 16 (Central Intelligence Agency, 2015). Tarte consumers are often young, educated and
single, which translates well into the U.K. market.
The overall population of the United Kingdom is expected to reach 68,631,000 by 2030
(United Nations Statistics Division, 2015). The healthy lifespan of U.K. female residents is 68.4
years, with an overall life expectancy of 89.2 years (Eurostat, 2013). Currently the country has
the fifth highest immigration population: 8.5 million (United Nations Statistics Division, 2015).
The economic and labor markets are major drivers of international migration, and language,
study opportunities and establish networks often encourage people to immigrate to the country
(Markaki, 2015).
Technological Environment
As a fully developed, long industrialized country, the United Kingdom is very similar to
the United States in technological development and technology usage. In terms of marketing
reach and opportunity, the country has strong availability of internet, television and radio. Cell
penetration is 78.5 million, or 124 percent of the population since many users have more than
one cellular phone (Central Intelligence Agency, 2015). Internet reach is 57.3 million, or 91
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percent of the population (Central Intelligence Agency, 2015). The country had 940 television
stations as of 2008, 206 AM radio stations and 696 FM stations (Central Intelligence Agency,
2015).
Social networking is also very popular in the U.K.: 65 percent of online adult users have
a social networking profile (“Adults’ media use and attitudes report 2014.” 2013). Nearly all
users with a profile have one on Facebook, and users with only a Facebook profile (and no other
social networking profile) have fallen to only 43 percent (“Adults’ media use and attitudes report
2014.” 2013). Three out of ten online adults have a Twitter account, and one out of five have
YouTube (“Adults’ media use and attitudes report 2014.” 2013). Lastly, 60 percent of users visit
social media sites more than one time a day (“Adults’ media use and attitudes report 2014.”
2013).
Environmental Climate
The climate in the United Kingdom is often thought of as cold and dreary. In reality, the
coldest months of December and January average about 38 to 40 degrees Fahrenheit (The World
Bank, 2015). The rainy season begins in August with average rainfall of four inches, and
increases through December when averages reach 5.25 inches (The World Bank, 2015). Primary
weather-related hazards include winter windstorms and floods (Central Intelligence Agency,
2015).
The United Kingdom’s per capita energy usage as of 2011 was 2,973 kilograms of oil,
decreasing by 2.81 percent from 2005 (Central Intelligence Agency, 2015). Carbon dioxide
emissions per capita were 7.86 kilotons in 2010, decreasing by 1.87 percent annually from 2005
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(Central Intelligence Agency, 2015). Carbon dioxide emissions for the country total 493,505
kilotons (Central Intelligence Agency, 2015).
Climate change has impacted the U.K., and goals have been created to reduce
greenhouse gas emissions (Central Intelligence Agency, 2015). The country reduced industrial
and commercial waste in landfills in 2005 to 85 percent of what it was in 1998, and it recycled or
composted at least 25 percent of its waste (Central Intelligence Agency, 2015). Additionally, the
U.K. participates in international environmental agreements in the areas of air pollution,
biodiversity, climate change, hazardous wastes, and ozone layer protection, amongst others
(Central Intelligence Agency, 2015).
The current environment and efforts to improve emissions make the United Kingdom an
ideal market to meet the Tarte brand’s goals: produce environmentally friendly products that
improve skin health and make women feel more beautiful.
Legal Environment
The United Kingdom conducts a lot of business with the United States. The Federal
Trade Commission and Department of Justice oversee trades between these countries (European
Commission, n.d.). Dedicated agreement exist to offer best practices between these countries,
and they include the Best Practices on Cooperation in Merger Investigations and additional
agreements regarding positive comity principles and application of competition laws (European
Commission, n.d.). The overall goal of these contracts is to promote cooperation and
coordination between countries, governing their trades.
The European Commission (EC) is an executive body of the European Union (EU) that
manages antitrust laws by proposing legislation, implementing decisions, upholding treaties and
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managing business of the European Union (European Commission, n.d.). The EC has several
treaties that prohibit agreements between businesses that may restrict competition and prohibit
dominant businesses from abusing their position by charging unfair prices, limiting production,
or refusing to offer new products to customers to meet their needs (European Commission, n.d.).
Discrimination laws are also upheld by the EU in the United Kingdom. The EU works
to prevent discrimination on the grounds of racial or ethnic origin, religion or belief, disability,
age, sexual orientation or sex (European Commission, n.d.). The EC specifically takes action to
raise awareness on discrimination, consumer rights and business obligations, supporting
development of equality policies, engaging in and offering anti-discrimination training activities,
and pushing for business-oriented diversity management. (European Commission, n.d.). The
Racial Equality Directive and Employment Framework Directive both promote equal treatment
in employment and occupation for all United Kingdom residents.
Market Segmentation
The market for premium cosmetics in England is very strong. English women, in
particular, spend more on beauty products than any other European Union country (Forsey,
2008). English women have an appetite for innovation in the cosmetics industry and prefer
higher priced products (Forsey, 2008). Even when the economy was at a very low point in 2012,
the health and beauty market in the United Kingdom was strong (Morley, 2013). Boots, a
cosmetics industry leader, saw a profit increase of 5.2 percent (Morley, 2013).
The United Kingdom has 2,084,000 females aged 20 to 24, and 2,188,000 aged 25 to 29
(United Nations Statistics Division, 2015). The total United Kingdom population is 63,200,000,
of which England makes up 53,000,000 or 84 percent (Office for National Statistics, 2011). This
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translates to a potential cosmetics target market in England of 3,588,480 ((2,084,000 x
84%=1,750,560) + (2,188,000 x 84%=1,837,920) =3,588,480). 93 percent of women in the
United Kingdom wear color cosmetics, further refining the target market to 3,337,286 people
(“Go!,” 2014). The prestige, higher end cosmetics market has seen the largest recent increase,
and 42 percent of United Kingdom consumers choose prestige brands (“Go!,” 2014). For Tarte,
this translates to a possible consumer base of 1,401,660 women avidly seeking color cosmetics.
Additionally, brand loyalty in cosmetics is strong: two in five women who buy prestige
foundation rarely change the brand of face makeup that they purchase (“Go!,” 2014).
Competition in the Market
The skincare industry has a strong leading player in the market: L’Oreal with 24.4
percent of market share (“Skincare industry profile: United Kingdom,” 2014). The cosmetics
market is slightly more fragmented with four top players holding 58.1 percent of the market
share, two of which are L’Oreal and Coty (“Make-up industry profile: United Kingdom,” 2013).
Both companies have a leading brand that provide ample competition for Tarte: L’Oreal’s Urban
Decay and Cody’s Rimmel London.
Urban Decay is a brand founded on the promise of edgy cosmetics with bold, unique
colors (Urban Decay, n.d.). It is known for experimental shades and innovative products, with
one of its best sellers being an Eyeshadow Primer Potion that promises crease-free eyeshadow all
day and night (Urban Decay, n.d.). Urban Decay has prestigious, eye-catching packaging and is a
cruelty-free brand, much like Tarte (Urban Decay, n.d.). Urban Decay is also a prestige brand
and is sold at specialty cosmetic stores. It has the largest potential for keeping or taking Tarte’s
consumers interested in bold, unique color palettes and the offer of color-stay foundational
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products. Urban Decay does not have as strong of a focus on environmentally friendly or skin-
protecting ingredients as Tarte does, and it is not committed to lessening its carbon footprint.
Rimmel London is very different from Tarte in its ingredient-sourcing, production,
pricing, and commitment to cruelty-free products. It is a competitor to Tarte primarily in its wide
variety of color options and its availability in the English market. Rimmel London’s focus is on
new shades and products, avidly advertising its easy-to-use, versatile and accessible products
(Rimmel, n.d.). It is sold at a lower price point, typically in drugstores, although available in
beauty store, Ulta (Rimmel, n.d.). Its products are not cruelty-free or focused on healthy
ingredients and positive skincare regimens. Rimmel London’s biggest benefits are that it offers
many colors, frequent new products, and is inexpensive so consumers can try new products
frequently. Typically, it is not a direct competitor of Tarte.
Customer Needs and Opportunities for Innovation
The fashion industry has a strong influence on the make-up market (“Make-up industry
profile: United Kingdom,” 2013). United Kingdom consumers prefer to differentiate themselves
through various styles and the wide array of brands offered in the cosmetics market, choosing
colors and products that project their personality (“Make-up industry profile: United Kingdom,”
2013). Due to the volume of brands available on the market, retailers are obliged to offer buyers
what they want (“Make-up industry profile: United Kingdom,” 2013). As consumers with strong
brand preferences and purchasing power age, the biggest opportunities for innovation lie in anti-
aging products including hydration, spot correction, and fine line reduction (“Go!,” 2014).
Prestige brands also have the opportunity to engage new consumers with smaller sized, trial
option products that are purse-friendly and easy to use (“Go!,” 2014). Marketers’ focus in this
category should be highlighting product formulations and ingredients as a way to prove
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 17
worthiness of prestige pricing (“Go!,” 2014). Fortunately, the Tarte brand is built on premium
quality ingredients and has built brand loyalty based on its environmentally savvy manufacturing
practices.
The cosmetics industry continues to grow, with more competition entering the market
regularly (“Skincare industry profile: United Kingdom,” 2014). Primary drivers of growth
include the ageing of developed country’s populations, growth of the middle class, technological
developments in the industry and an increase in health and wellness awareness (“Skincare
industry profile: United Kingdom,” 2014).
Innovation in the cosmetics market can be seen in the vast variety of anti-aging products
becoming available. Premium anti-aging products are the strongest growth category for
cosmetics companies (“Skincare industry profile: United Kingdom,” 2014). Ultraviolet ray
protection has also taken off and is offered in most foundations and face lotions (“Skincare
industry profile: United Kingdom,” 2014). Both Tarte’s BB tinted face cream and Amazonian
Clay 12-Hour Full Coverage Foundation contain SPF protection. Given Tarte’s consumer
demographic of women 20 to 30, the company should continue adding anti-aging products to its
line in an effort to meet the needs of consumers beginning to fight signs of aging in their
twenties.
Potential for Product Extension
As the market becomes more saturated, the need for personalized and targeted products
grows (“Skincare industry profile: United Kingdom,” 2014). The increased focus on health and
wellness provides an opportunity for Tarte fitting its core mission to use “skinvigorating”
ingredients (Tarte, n.d.). Tarte has several products targeted at anti-aging: Maracuja oil described
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as providing firmer, brighter, smoother skin, Maracuja neck treatment targeted at improving the
appearance of skin on the neck, and Maracuja C-brightener eye treatment that claims to hydrate,
firm and brighten the eye area (Tarte, n.d.). Tarte could extend its brand by creating a fine line
and wrinkle reducer that provides proven results while promising the same dedication to earth-
friendliness, cruelty-free testing, and attractive packaging. Following this proven process for
product development, Tarte would ensure and improve brand loyalty by offering a product that
enables loyal customers to purchase from Tarte rather than buy a competitor’s wrinkle-reducer
that the customer is likely using.
External influences on this brand extension include the aging of the overall population in
developed countries, as well as the aging of Tarte’s primary target consumer. Culture in England,
much like America, encourages women to look young and beautiful for as long as possible.
While Tarte has several products that aid in fighting facial signs of aging, the gap in a wrinkle
reducer likely drives loyal customers to purchase this product from competitors.
Internally, Tarte is probably less motivated to create a new, wrinkle reducing product. It
likely sees its general Maracuja oil as a similar substitute since the oil promises firmer, brighter
skin. Additionally, Tarte likely faces a difficult process of obtaining ingredients that fit the
product’s core values while also promising results. Traditional anti-aging products may contain
ingredients obtained from animal by-products (Dallmeier, n.d.). Tarte would need extensive
product sourcing and testing before being able to release a new wrinkle reducing product, which
would take significant time and resources.
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 19
Product Position
Tarte cosmetics is positioned as a healthy, environmentally conscious brand aimed at
attracting young, fashion-forward consumers. Tarte competes in product quality, in both
ingredients and production techniques, and does not attempt to attract money-conscious
consumers in the cosmetics market. Competitor Urban Decay is also positioned in the premium
cosmetics market, using its own unique positioning. Urban Decay is focused on an edgy design,
offering alternative colors to the traditional palettes of pink, red and beige. Tarte’s unique
positioning comes from its ecological-focus and couture packaging.
Tarte’s other competitor in the United Kingdom market, Rimmel London, is positioned
entirely as a less expensive drug store brand. The company attracts consumers through offering
beauty products for budget-conscious consumers. While still fashion-forward and cutting edge
on new product features including an eyeliner with Precision Micro tip for fine lines (“Rimmel
debuts its spring lineup,” 2013), Rimmel competes in a different market than Tarte and Urban
Decay.
Tarte was likely positioned in the United States initially to early adopters: fashionable
big city dwellers eager to buy new, trendy products shortly after their introduction (Schiffman &
Wisenblit, 2015). Some very early consumers were probably innovators, learning about the
brand from an exclusive fashion publication then spreading their love of the new product to the
early adopters via word of mouth. In the English market, Tarte already has a level of notoriety as
it is currently available through online Sephora purchases and QVC. As such, the innovators and
early adopters have probably already tried the brand through one of these other forums. The
biggest benefit to launching the brand in-store is to expand to a new market of early to late
majority adopters; those that have avoided the risk of springing for a pricey premium brand
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cosmetic without waiting for peer confirmation of its value (Schiffman & Wisenblit, 2015).
Early and late majority adopters will also welcome the benefit of being able to actively sample
the brand in-store before making a purchase.
Pricing
Tarte’s position in the cosmetics market enables a loftier pricing strategy consistent
with other prestige cosmetics, opposed to a strategy focused on meeting the needs of price-
conscious customers. The premium price of Tarte products also supports the brand’s position by
telling consumers that the product is high-end, offers luxury as well as environmental
sustainability, and is worth the additional cost. This pricing strategy is consistent with prime
Tarte competitors, and an accepted practice among cosmetics consumers.
While the keystone markup in fashion is typically 50 percent, premium cosmetics come
in at 60 to 80 percent (Waits, 2010). Tarte’s ingredients are higher quality and ecologically
sourced, so this standard markup yields less profit for the company. Additionally, selling Tarte in
a department store incorporates additional distribution factors, e.g. cosmetics salespeople, and
the company needs to factor this additional expense into the markup as it will likely be assessed
back to the company by the department store. Given these details, it is recommended that Tarte
leverage the full standard premium cosmetics markup of 80 percent. As an example, Tarte’s
Amazonian Clay 12-Hour Full Coverage Foundation retails on Sephora.com for $39.00
(Sephora, n.d.). It is likely the product is already marked up 75 percent, with the actual cost
being about $23 ($23x.75=$17.25+$23=$40.25). Adding an extra five percent to account for
retail sales distribution, the foundation should be priced at $41.50 ($23x.80=$18.40+
$23=$41.40).
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 21
Discounts are not common on prestige cosmetic products as they provide a conflicting
message to consumers about the value of the product. However, selling Tarte cosmetics as part
of a department store retail operations allows for a unique opportunity to leverage exclusive
“Friends and Family” sales. Tarte products should be allowed to be sold during these promotions
for a small fixed percentage discount, following the guidelines of other premium store brands.
The exclusivity of the event, typically only offered to core customers and department store
friends and relatives, provides an exciting opportunity to save on Tarte products, purchase
several more items than consumers typically would, but still ensures customer loyalty year-round
since these events are typically held only once a year.
Distribution Strategy
The consumer decision-making process is integral in Tarte’s implementation of a
broader distribution strategy in England. Many English women are already consumers of prestige
cosmetics, and research has shown that consumes in the United Kingdom are less brand loyal
than the United States (Schiffman & Wisenblit, 2015). This provides an advantage for Tarte
since English consumers are more open to the prospect of trying a new brand.
Consumers begin with identifying a need that is not met with their current beauty
regimen (Schiffman & Wisenblit, 2015). For potential Tarte consumers, this need may be finding
a more environmentally suitable product or a cosmetic with more natural, skin-improving
benefits. The consumer would then begin a pre-purchase search (Schiffman & Wisenblit, 2015).
This search could lead consumers in the direction of Sephora online sales, currently available
and offering Tarte, or it could land them in department stores.
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Expanding Tarte distribution to department stores is the best strategy because it allows
consumers to sample the product in person. Currently, English consumers are only able to
purchase on QVC or Sephora, leading to a more limited trial of products whereas consumers may
purchase one item or several sample sizes before committing to the brand. In-store sampling with
Tarte-educated cosmetics sales people would provide product awareness and promotion,
improving the chances that the consumer would purchase more than one product in their first
visit.
Promotional Strategy
England’s strong demand for premium cosmetics paired with a specific demand for the
Tarte brand strong enough to bring it to the market via QVC set the stage for incorporating the
brand into department store sales. The cosmetics market in the United Kingdom reflects strong
buyer power and diversified retailers (“Skincare industry profile: United Kingdom,” 2014).
While most cosmetics are purchased from supermarkets (46.9 percent), the second largest
distributor is specialist retailers (18.6 percent) (“Skincare industry profile: United Kingdom,”
2014). English women are strong buyers of high end cosmetics, and they prefer to purchase them
in specialty shops that cater to the exclusivity and class that premium brands provide.
Studies have also found that major manufacturers advertise to consumers to effectively
build brand loyalty (“Make-up industry profile: United Kingdom,” 2013). When it comes to
loyalty, consumers prefer designer brands over retailer products, further creating opportunity for
Tarte to make its entry as a department store brand (“Make-up industry profile: United
Kingdom,” 2013).
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 23
Research found that the primary driving force behind using cosmetics is the personal
satisfaction of preserving an attractive appearance (Costa, 2012). In advertising products, there is
a growing desire for brands to feature a range of products that work together rather than just
focusing on a single product at a time (Costa, 2012). Additionally, more women are choosing
products that accompany a healthy lifestyle to amplify anti-aging benefits: 76 percent of survey
respondents agree that the right beauty products can maintain a youthful look longer, and 64
percent say that eating the right food is most important towards looking beautiful (Costa, 2012).
Last, the study showed that most respondents preferred to see naturally beautiful women with a
few aging lines used in advertising (86 percent), and 50 percent are concerned when photographs
of celebrities are airbrushed (Costa, 2012). The resulting market relies on products that are
natural and healthy, are advertised and can be purchased as part of an entire line, and are
promoted by striking, yet real women they can relate to.
The resulting promotional strategy should be targeted at the key audience, English
women ages 20 to 30, using media that they are most likely to respond to. Women in this
generation, Millennials, respond strongly to online advertising and social media campaigns. They
are tech-savvy and appreciate receiving brand education as part of media campaigns
(Schoenwalder, 2015). Online media should also be leveraged to push sales promotions and
periodic e-coupons to target new consumers and build brand loyalty. Women in this category are
avid smartphone users and frequently leverage codes that can quickly be accessed at a touch of a
button to receive promotional discounts.
In addition to online media, targeted consumers would also respond to print ads in
beauty magazines. These would include top magazines such as InStyle, Marie Claire, Stylist, and
Glamour. While online media is often preferred by Millennials, sales of beauty magazines are
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 24
still strong: In Style has a sell-through of 59.7 percent and Marie Claire has 50 percent, both high
above the average sell-through of 34 percent (Bercovici, 2004). Tarte should also continue to
leverage its catchy, fashion-forward packaging when introducing its products to England since
the packaging is both recognizable and helps to distinguish the brand as valuable and unique.
Extending the brand to include a wrinkle-reducing product also fits into the overall
promotional strategy of advertising an entire line of products, making it easier for consumers to
switch to exclusively using Tarte beauty products. Environmentally, health-conscientious
consumers would be served by a cosmetics line advertised as fitting all of their beauty needs:
fashion-forward products and packaging, environment- and animal-friendly production, and
healthy, skin-invigorating ingredients.
Cultural Values and Customer Satisfaction
Rokeach Value Surveys can be used to evaluate personal values and establish an
understanding for marketers on a culture’s terminal values, those that represent desired end-
states of existence, and instrumental values, the means to achieve the ends (Schiffman &
Wisenblit, 2015). While little research exists on terminal and instrumental values for English
women in particular, many of Tarte’s core principles are represented by match individual’s shifts
towards values of materialism, youthfulness, ecological responsibility and personal health
(Schiffman & Wisenblit, 2015). These values are matched to Rokeach end terminal values of
living a comfortable, dosed with happiness and pleasure.
Tarte’s position as a leader in eco-friendly, skin-benefitting, and youth-inspiring
products are reflected in these core values. Americans and Brits alike have become more aware
and invested in purchasing environmentally friendly products. They seek cosmetics that make
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 25
them appear youthful, and products that will keep them healthy. However, materialism is still
present: women still want to look beautiful and use purchases of premium goods to feel better
about themselves and their status (Schiffman & Wisenblit, 2015). People want products that are
higher quality rather than just abundant which Tarte offers in the form of premier cosmetics.
Maintaining customer satisfaction is also significant to engaging consumers and
improving loyalty for long-term growth. Customer satisfaction and customer-company
identification have a positive effect on loyalty and willingness to pay for the brand (Haumann,
Quaiser, Wieseke, & Rese, 2014). Further, customer satisfaction has a more prominent effect on
these attributes (Haumann, Quaiser, Wieseke, & Rese, 2014). Customer-company identification
is more effective in the long-term for stabilizing customer loyalty and driving desired consumer
outcomes over time (Haumann, Quaiser, Wieseke, & Rese, 2014).
To evaluate Tarte’s customer satisfaction, a quick glance at Tarte’s Facebook page
reveals over 600,000 consumer likes, Twitter shows almost 250,000 followers, and Instagram
demonstrates another 3.1 million followers. Being customer centric does not just mean having a
lot of social media followers; it also means providing good problem resolution and complaint-
handling. The Better Business Bureau reflects only five complaints filed in the last three years,
three of which were in the last twelve months (Better Business Bureau, 2015). It could be
presumed that problems with cosmetics do not generally incite enough frustration from
customers to report an incident to the Better Business Bureau, but one positive finding is that no
website has been created by a pool of frustrated customers wishing to vent about the Tarte brand
(unlike other cosmetic companies, e.g. MAC). Additionally, Tarte products sold on Amazon
average four to four and a half stars when rated by consumers (Amazon, 2015).
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 26
Conclusion
Tarte Cosmetics has a strong brand positioning and has already proven desirable in the
English market. The values of the company and product options provided to customers are in line
with English preferences. This audit paper has proven that Tarte can be easily integrated into
broad English market through department store distribution since the brand is a good fit for
English consumers.
BA 656 – International Consumer Audit Paper: Tarte Cosmetics 27
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Appendix A