Business Model

1. What business model enables SK-II to create value and be a profitable brand?

I am sure, that it is extremely important for DeCesare to do necessary research to determine pros and cons of SK-II brand. I would pay attention to competitors, currently doing well in the area. I think that 5 forces model is the best choice to see how the brand would perform in another country. This model would provide DeCesare with a clear way or organizing the buyers, substitutes, potential entrants, and suppliers in order to organize industry rivalry.

Should SK-II become a global brand? Why?

SK-II is not a typical P&G product, but its successful representation in Taiwan and Hong Kong gives possibilities to think that it can be successful global brand. SK-II's potential surrounding breaking into the global market and becoming a competitive brand would allow P&G to obtain a high margin product while still making a high-quality product. The characteristics of the SK-II's clear, un-perfumed liquid makes it distinctly different from other products.

Also, in my opinion, the idea of taking the SK-II that was so successful in the Japanese market global is very risky. But there are few issues that Paolo should consider:

1. Continue to be technology Leader

2. Sell of the SK-II Product line

3. Go out to other Asian markets.

4. Other countries have different culture than that of consumers in Japan which is why this is a big risk.

5. Lafley's POV was that most of the advertising budget should be spent on two product - MaxFactor Color and SK-II; SK-II had such a high margin.

6. Do they have abilities to have competitive advantage among such big brands as Dior, Chanel, Lancôme?

7. They have to organize a highly cost advertisement among unawared customers.

2. Which market should be a priority in growth strategy for SK-II brand? China? EU/UK? Japan?

While analyzing a possible growth strategy for SK-II brand among three options: Europe< Japan and China, P&G should continue to concentrate its efforts in Japan to further penetrate and grow its share (only 3% of a $10 billion