Case Study

THE BODY SHOP

SUMMARY

Anita Roddick started The Body Shop in Brighton, England, in 1976. The

company was established to sell cosmetics and lotions that were environmentally

friendly and were not tested on animals. The company caught the 1980s wave of the

growing awareness of ecology and the company grew at a phenomenal rate.

The rapid growth has not been without problems. Many competitors entered

the market after seeing the success of The Body Shop. The Body Shop, which has

always relied on publicity instead of advertising, may now need to change its

promotional strategy. In addition, stockholders are not always happy with the

company's philosophy of doing good instead of concentrating on profits. Finally,

personnel issues have surfaced and the company lost a husband and wife team that

was responsible for developing one of The Body Shop's most successful product lines.

Amid all of these problems, Anita admits that running a large, bureaucratic company

is like death.

The most common criticism is that the company lacked a plan for the future and

had no clear sense of direction in its marketing. By the end of the decade, the

company was dramatically restructured, manufacturing was divested, and Roddick

took a back seat as a new CEO was brought in. However, Christmas sales in the year

2000 were poor and in the early part of 2001, the company showed a decline in sales

when compared to the previous year.

DISCUSSION QUESTIONS

1. In what ways is The Body Shop experiencing problems similar to those of many

rapidly growing companies?

2. If you were hired as a consultant which problem would you consider most

critical?

3. Why are sales in the United States not increasing when sales in other countries

are improving?

4. What should The Body Shop do in the United States?