Question

I'm writing a report on Competitive Environment for the beauty industry and need some guidance on where to find the information to complete a section on the competitive dynamics of the beauty industry.

thanks

Answer 1

The scope of whether a market is competitive or not depends on the nature of its products. In the industry, if the products are very difficult to replicate and have distinct characteristics then it will be a non -competitive market. However, in the markets where the products are very similar to each other and can be very easily replicated, it will be a perfect example of a very competitive market.

In the fashion industry, the products are very similar, therefore, the fashion industry is very competitive and the products are extremely competitive. This also makes the industry very price elastic wherein the sale of the products is directly related to the prices of the products.

The model of competitive dynamics for the fashion industry is as follows: -

i) New competitive action - It is the first step in establishing the competitive dynamics of the fashion industry, it improves the market position of the, capitalize on the growth of the market & obtain a fast movers advantage.

ii) Threat & Competitor analysis - This is the most important step as it deals with the fact whether the firm has the necessary power to survive the competition already operating in the market and win constant market share in the fashion market. Under this step the organization analyses the potential scope of entry of new competitors which is very high in the industry, & the level of competition in the industry which is high.

iii) Choose to respond or not to respond - This deals with the fact if there is innovation in the fashion industry the up-gradation or acceptance that the firm is required to bring to survive in the market. In the fashion market, the market is subject to frequent change, therefore, the firm must learn to be an early adopter to survive in the market else it runs into the era of slowly moving out of the market.

iv) The likelihood of competitive reation- This deals with the fact that given the fact the firm is a early mover in accepting a change what will be the reaction of its competitiors. In fashion industry there is high probability of acceptance of the new cahnge by all the comptetitors in the industry.

As asked by you in your question, in case you need additional information for the project you may refer to the following books. Please note that some of these books may be very difficult to find: -

1) Competitive analysis of the fashion industry.

2) Organizational innovation in the apparel industry

3) Fashion response to changes in the fashion industry.