KIT: The cosmetics market in India (2008)

Strategic tools for the practising manager

THE COSMETICS market in India is valued at Rs 712 crore and is expected to reach Rs 1,514 crore by 2012.

THE MARKET CONSISTS of eye and facial makeup products, talcum powders, lipsticks and nail enamels.

THE FACIAL MAKEUP market in India is valued at Rs 97 crore and is expected to reach Rs 200 crore by 2012.

THE LIPSTICK market in the country is valued at Rs 296 crore.

THE TALCUM POWDER market is valued at Rs 236 crore and is expected to reach Rs 495 crore by 2012.

NUGGETS
Selections from management journals

THE RESCUES, bankruptcies and dizzying write-downs involving high-profile giants of international finance signal a reckoning for Wall Street wizards who engineered the ongoing credit crisis with opaque securities based on risky subprime home loans and the assumption that housing prices would never decline, according to a panel of Wharton professors. The flood of bad debt, they add, won’t subside anytime soon.

Will the levee break? An ocean of bad debt rises despite government rescues
Knowledge@Wharton, September 17
Read the article at http://knowledge.wharton.upenn.edu/

INDIA’S ECONOMY IS growing at a torrid pace, with business process outsourcing leading the way. But a shortage of one crucial resource — a well-educated workforce — threatens to derail the country’s growth and its drive to create 80 million jobs by 2016.

Corporations are now stepping in to try to fill the training gap, but will it be enough? “If we don’t take steps to improve the quality of our engineering graduates, we will soon lose out on our ability to compete globally,” says N R Narayana Murthy, chairman and chief mentor at Infosys.

India’s corporations race to train workers and avoid being left in the dust?
India Knowledge@Wharton, September 19 - October 2
Read this article at http://knowledge.wharton.upenn.edu/india/

IN RECENT YEARS, researchers and consultants have advanced a number of customer metrics to explain the connections between customer behaviour and growth. But these efforts have generated more smoke than heat. Despite claims to the contrary, the authors argue that the most popular metrics have shown only modest correlations to growth. None of them have shown themselves to be universally effective across all competitive environments.

Early customer metrics tried to explain why people buy. To many companies, it came down to marketing. Yet, as the authors explain, the issues that affect customer loyalty are complex and go beyond standard marketing. Today’s most popular metric, the Net Promoter Score, focuses on how customer word-of-mouth — both negative and positive — can advance growth. Developed by Bain & Company consultant Fred Reichheld, it claims the ability to predict future growth from customer replies to one question: “How likely is it that you would recommend this company to a friend or colleague?” The authors found that the linkage between the Net Promoter Score and subsequent customer behaviour was modest at best; models based on multiple variables consistently outperformed models based on Net Promoter. The authors are sceptical that there can be a single metric that reduces complex, multifaceted constructs to one or two dimensions.

Linking customer loyalty to growth
By Timothy L Keiningham, Lerzan Aksoy, Bruce Cooil and Tor Wallin Andreassen
MIT Sloan Management Review
Summer 2008, Vol. 49, No. 4
Subscribe to this article at http://sloanreview.mit.edu/smr/