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Harvard Case - Navigating SheaMoisture through a Racial Awakening: Cara Sabin's Authentic Leadership

"Navigating SheaMoisture through a Racial Awakening: Cara Sabin's Authentic Leadership" Harvard business case study is written by Stephanie Robertson, Jeremy Petranka. It deals with the challenges in the field of Strategy. The case study is 16 page(s) long and it was first published on : Jul 26, 2022

At Fern Fort University, we recommend SheaMoisture adopt a multi-pronged strategy focused on authenticity, inclusivity, and sustainable growth. This strategy involves strengthening their brand identity, expanding their product portfolio, embracing digital transformation, and deepening their commitment to social responsibility.

2. Background

This case study focuses on SheaMoisture, a natural hair and body care company founded by the Sabin family, and their journey navigating the complex landscape of racial awakening in the United States. The company faced criticism for its ownership structure and marketing practices, leading to a period of introspection and re-evaluation. Cara Sabin, the current CEO, emerged as a leader committed to authentically addressing these concerns and driving positive change.

3. Analysis of the Case Study

A. SWOT Analysis:

Strengths:

  • Strong Brand Identity: SheaMoisture has a loyal customer base drawn to its natural ingredients and commitment to ethical sourcing.
  • Authenticity: The brand's connection to African heritage and its commitment to social justice resonate with a growing segment of consumers.
  • Product Innovation: SheaMoisture has a diverse product portfolio catering to a wide range of hair and skin types.
  • Strong Online Presence: The company leverages digital platforms effectively for marketing and customer engagement.

Weaknesses:

  • Ownership Structure: The initial ownership structure raised concerns about authenticity and representation.
  • Marketing Practices: Past marketing campaigns were criticized for lacking inclusivity and perpetuating stereotypes.
  • Limited International Presence: SheaMoisture's focus on the US market limits its potential for global growth.
  • Supply Chain Challenges: Ensuring ethical sourcing and sustainable practices across the supply chain can be complex.

Opportunities:

  • Growing Demand for Natural Products: Consumers are increasingly seeking natural and organic personal care products.
  • Expanding Global Markets: The global market for natural beauty products is vast and presents significant growth potential.
  • Digital Transformation: Leveraging technology and data analytics can enhance customer experience and drive sales.
  • Social Impact Initiatives: SheaMoisture can further solidify its commitment to social justice through impactful initiatives.

Threats:

  • Increased Competition: The natural beauty market is becoming increasingly competitive with new entrants and established brands.
  • Economic Volatility: Global economic uncertainty can impact consumer spending on non-essential products.
  • Shifting Consumer Preferences: Consumer preferences are constantly evolving, requiring brands to adapt and innovate.
  • Regulatory Changes: Changes in regulations regarding ingredients and sourcing can impact the business.

B. Porter's Five Forces:

  • Threat of New Entrants: Moderate - The natural beauty market is attractive, but barriers to entry exist due to brand recognition, supply chain complexities, and regulatory requirements.
  • Bargaining Power of Buyers: Moderate - Consumers have a wide range of choices, but SheaMoisture's strong brand loyalty and unique product offerings provide some leverage.
  • Bargaining Power of Suppliers: Moderate - SheaMoisture relies on ethical sourcing of ingredients, which can create dependence on specific suppliers.
  • Threat of Substitutes: High - Many alternative personal care products exist, including synthetic and organic options, posing competition.
  • Rivalry Among Existing Competitors: High - The natural beauty market is crowded with established and emerging brands, leading to intense competition.

C. Value Chain Analysis:

SheaMoisture's value chain can be analyzed through the lens of authenticity, inclusivity, and sustainability. The company needs to ensure that these values are embedded throughout its operations, from sourcing ingredients to customer service.

D. Business Model Innovation:

SheaMoisture can explore business model innovation by:

  • Direct-to-Consumer Model: Strengthening online sales and leveraging digital marketing to reach a wider audience.
  • Subscription Services: Offering subscription boxes tailored to specific hair and skin types, promoting customer loyalty and recurring revenue.
  • Partnerships and Collaborations: Collaborating with influencers, retailers, and social justice organizations to expand reach and impact.

4. Recommendations

A. Strengthen Brand Identity:

  • Redefine Brand Positioning: Emphasize SheaMoisture's commitment to inclusivity, social justice, and authentic representation.
  • Refine Marketing Strategy: Develop campaigns that celebrate diversity, promote self-acceptance, and resonate with a wider audience.
  • Engage with Influencers: Partner with diverse influencers who align with the brand's values and reach new customer segments.

B. Expand Product Portfolio:

  • Develop New Product Lines: Introduce products catering to specific needs and concerns within the natural hair and skin care market.
  • Explore New Categories: Consider expanding into complementary categories like hair styling tools, skincare accessories, or natural beauty supplements.
  • Focus on Sustainability: Develop eco-friendly packaging and prioritize sustainable sourcing practices across the product line.

C. Embrace Digital Transformation:

  • Enhance E-commerce Platform: Optimize the online store for user experience, personalize recommendations, and offer seamless checkout.
  • Leverage Data Analytics: Utilize data to understand customer preferences, optimize marketing campaigns, and personalize product recommendations.
  • Invest in Social Media: Build a strong social media presence, engage with customers, and leverage social media marketing strategies.

D. Deepen Commitment to Social Responsibility:

  • Invest in Community Initiatives: Support organizations and initiatives promoting social justice, education, and economic empowerment.
  • Transparency and Accountability: Be transparent about sourcing practices, ingredient sourcing, and manufacturing processes.
  • Employee Empowerment: Foster a diverse and inclusive workplace culture that values employees' contributions and promotes career growth.

5. Basis of Recommendations

These recommendations are based on a comprehensive analysis of SheaMoisture's strengths, weaknesses, opportunities, and threats, as well as the evolving consumer landscape and the company's commitment to social responsibility.

1. Core Competencies and Consistency with Mission: The recommendations align with SheaMoisture's core competencies in product innovation, natural ingredients, and brand authenticity. They also reinforce the company's mission to promote inclusivity, social justice, and sustainable practices.

2. External Customers and Internal Clients: The recommendations address the needs of diverse customer segments by offering a wider range of products, improving the online experience, and engaging with influencers. They also empower employees by fostering a more inclusive workplace culture.

3. Competitors: The recommendations help SheaMoisture stay ahead of the competition by focusing on innovation, digital transformation, and social responsibility, differentiating the brand in a crowded market.

4. Attractiveness ' Quantitative Measures: While specific financial projections are not provided in this analysis, the recommendations are expected to drive growth by increasing market share, expanding product offerings, and leveraging digital channels effectively.

6. Conclusion

By embracing a multi-pronged strategy focused on authenticity, inclusivity, and sustainable growth, SheaMoisture can navigate the complex landscape of racial awakening, solidify its position as a leader in the natural beauty market, and achieve long-term success.

7. Discussion

Alternatives:

  • Focusing solely on product innovation: While product innovation is important, it's not sufficient to address the broader challenges facing SheaMoisture.
  • Ignoring digital transformation: Failing to embrace digital transformation would hinder the company's ability to reach new customers and compete effectively.
  • Minimizing social responsibility: Ignoring social responsibility would alienate customers and damage the brand's reputation.

Risks and Key Assumptions:

  • Consumer preferences may shift: The natural beauty market is dynamic, and consumer preferences can change rapidly.
  • Competition may intensify: The natural beauty market is becoming increasingly crowded, requiring constant innovation and adaptation.
  • Economic uncertainty may impact sales: Global economic volatility can impact consumer spending on non-essential products.

8. Next Steps

Timeline:

  • Year 1: Implement brand repositioning strategy, launch new product lines, and enhance e-commerce platform.
  • Year 2: Expand international presence, invest in data analytics and social media marketing, and launch social impact initiatives.
  • Year 3: Continue product innovation, strengthen digital capabilities, and deepen commitment to sustainability and social responsibility.

Key Milestones:

  • Develop a comprehensive brand strategy: Define the brand's core values, target audience, and key messages.
  • Launch new product lines: Introduce innovative products that address specific needs and concerns within the natural hair and skin care market.
  • Invest in digital transformation: Upgrade the e-commerce platform, leverage data analytics, and build a strong social media presence.
  • Partner with social justice organizations: Support organizations and initiatives that align with the brand's values and contribute to positive social change.

By following these recommendations and taking decisive action, SheaMoisture can emerge as a leader in the natural beauty market, driving sustainable growth and making a positive impact on the world.

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Case Description

First Place Winner; 2022 DEI Global Case Writing Competition. Cara Sabin (she), a Black woman, became the CEO of Sundial Brands in 2019. The Sundial beauty brands focus on the personal care needs of Black women and men. In 2017, Unilever acquired Sundial Brands in a deal valued at $1.6 billion, one of the largest beauty and personal care deals in the United States to date and the largest consumer products deal involving a majority Black-owned company. Key to the acquisition was that Unilever agreed to allow Sundial to operate as a separate, autonomous company. As Sundial's CEO, Sabin was the public face of the brand. She was regularly interviewed and her picture was used for in-store marketing materials. Her personal values aligned strongly with Sundial Brands' mission and purpose. However, the company was still owned by Unilever, where the top executives were white men. As part of the resurgence of the Black Lives Matter movement in 2020, customers started increasing their support for Black-owned businesses while calling for the boycott of white-owned businesses that marketed to the Black community. It was in this environment in June 2020 that Sabin reviewed online attacks on SheaMoisture, Sundial's flagship brand, for being owned by Unilever. Sabin needed to decide how SheaMoisture should address this crisis. Should she wait to see if it would blow over? If not, what was the correct communication strategy? As a Black woman, was she willing to incur the personal attacks that would inevitably occur if she responded?

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