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Date Submitted: 11/22/2012 01:46 PM

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Demographics in these countries, such as what age group is buying more cosmetics and the level of income should also be kept in mind, and then the products should be marketed accordingly.

Political, Legal, and Governmental Forces:

Since Estée Lauder provides products all over the world, it is important for it to consider the regulations of those countries, as well as tax laws and tariffs should be kept in mind. Political state of the country should also be considered, especially when entering new markets.

Technological Forces:

With technological advances increasing in every industry, it is important for Estée Lauder to stay up to date. The use of Internet to market and sell products can prove to be very beneficial. Also, Research and Development is essentially important, as Estée Lauder needs to continuously improve its products to be able to stay in the lead.

Competitive Forces – Porter’s Five-Forces Model

• Barriers to entry - There are low entry barriers to the personal care products industry. However, in the cosmetic industry, brand loyalty, and credibility play an important role. New entrants should be monitored closely, however.

• Rivalry among competing firms – This industry is characterized by strong competition. There are numerous brands, offered generally at the same department stores, and at all levels of prices. Also, cost of switching brands is low to the customer, therefore its highly important to retain clientele

• Potential development of substitute products – Customers can substitute makeup and other related products, with century old traditional home remedies. This is true of places like Africa, China, and India.

• Bargaining power of buyers – The bargaining power of buyers is very strong, due to the fact that there is intense competition, and various distribution channels. For example, customers can buy the products in-store or online. Not only does Estée Lauder have to provide high quality products at competitive prices, but it...