However, because Rimmel is positioned above the bottom of the market, it could be a trade-up brand itself during economic upswings, as consumers leave their cheap local brands for a more prestigious and internationally recognized name like Rimmel.
The means by which Rimmel cosmetics are priced is appropriate for a company with its market strategy. Rimmel needs to have a good value proposition, which implies good quality and a relatively low price. The company has a strong established name and good celebrity endorsements, so it needs to separate itself from generic cosmetics with its pricing strategy, but its total sales figures and distribution strategy demand that Rimmel avoid luxury pricing and a high degree of exclusivity. As such, the companys pricing strategy at present are appropriate.
If anything, Rimmel should increase prices slightly in order to become firmly established as a premium provider within the mainstream cosmetics segment.
The company has the reputation, the sophisticated marketing and the celebrities to justify this type of positioning, and should utilize this source of competitive advantage in order to increase earnings. The company must guard, however, against setting prices too high in all regions. In developing nations the company will need to keep prices at current levels in order to retain business, since it is often competing against popular, cheaper local brands. The current strategy, however, is congruent with market needs and the brands positioning, so there is little cause to make any recommendation to change the strategy, even during unusual economic circumstances such as the present recession..