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Business Management Internal Assessment High level Topic: Ethical considerations in cosmetic product testing Research question: To what extent does MAC Cosmetics' policy on animal testing affect its brand image and customer perception in the Quito market? Concept: Ethics Session: May 2026 Students code number: 050952- Word count: 1800 Table of Contents
Acknowledgement Introduction Analysis Conclusion Bibliographic References Appendixes Annexes
The aim of this research is to analyze how animal testing affects the image and customer perception of MAC Cosmetics. Thanks to this mindset, which has been instilled in young people, companies are forced to adopt practices based on ethical values. The importance of this thinking influences the purchase of their products and their competitiveness as a brand? MAC Cosmetics (Make-up Art Cosmetics) is one of the best-known and most prominent professional makeup brands, founded in Toronto, Canada, in 1984, and acquired by Estée Lauder Companies in 1998, it sells its products in more than 120 countries, this company became accepted and delighted to the public for its inclusivity and diversity thanks to its slogan "All ages, all races, all genders", but now it has become a problem for testing on animals due to the requirements they must meet in order to sell in several countries such as China. In 2024, Mac announced it would not test on animals unless required by law, however, this has caused dissatisfaction among consumers with the idea that animal testing will not be completely eliminated. Several animal rights organizations, such as PETA and Cruelty Free Kitty, have updated their analyses and shown that MAC is not a cruelty-free brand, influencing consumer perceptions. To conduct this research, key business tools will be applied, such as a SWOT analysis to assess MAC's current position, Porter's Five Forces to examine competitive pressures, and market research to evaluate perceptions in the Quito market and benchmarking to compare MAC´s practices against industry leaders in ethical cosmetics, ethical considerations will be linked to brand equity and consumer behavior models. Table 1. Sources used in Analysis. Letter Type Date Link Summary
(Thesis)
Universidad de Valladolid. (2024). Percepción del consumidor frente a los factores morales y sociales a pagar más por productos cosméticos cruelty free en jóvenes de la Generación Z. Retrieved May 22, 2025, from https://uvadoc.uva.es/bitstream/handle/ 24/70524/TFG-N.%202368.pdf Explains how Generation Z values ethical factors and is willing to pay more for cruelty-free products. Useful to analyze how ethics affects customer decisions and perception. B Journal Article
593 Digital Publisher. (2024). El papel de los influencers en la comunicación de productos cruelty-free en Instagram. Retrieved May 22, 2025, from https://www.593dp.com/index.php/593_Di gital_Publisher/article/view/ Shows how influencers affect consumer perception and promote ethical beauty products. Useful to analyze impact of social media on MAC’s brand image. C Journal Article
Revista de Comunicación. (2024). Benchmarking y sostenibilidad en la industria de la belleza. Retrieved May 22, 2025, from https://revistadecomunicacion.com/index.p hp/rcom/es/article/view/3588/ Supports the use of benchmarking to compare MAC with other brands, especially in ethics and sustainability. Helps identify competitive position. D
(Thesis)
Universidad San Francisco de Quito. (2024). Análisis de las cinco fuerzas de Porter en la industria cosmética en Quito. Retrieved May 22, 2025, from https://repositorio.usfq.edu.ec/bitstream/ 000/12995/1/215369.pdf Applies Porter’s Five Forces to the cosmetic market in Quito. Useful to analyze competition, new entrants, and pressure on MAC. E Governme nt Report
Inteligencia Productiva. (2024). Oportunidades de negocio en Pichincha. Retrieved May 22, 2025, from http://www.inteligenciaproductiva.gob.ec/a rchivos/oportunidades_de_negocio/ pichincha/pichincha_01.pdf Provides information about local market conditions and opportunities. Useful to understand how consumer preferences are changing in Quito. Analysis MAC Cosmetics is a popular makeup brand that is known around the world. Many people like it because of their colors, professional quality, and modern style. In cities like
Another important factor is social media. According to (source B), influencers have a strong impact on how people see beauty products. Many influencers promote cruelty-free brands and talk about sustainability. This affects customer opinions, especially younger audiences. If influencers show that cruelty-free brands are better or more responsible, people may start to see MAC as a bad option. This can damage its image and reduce customer loyalty. Also, using Porter’s Five Forces (source D), we can understand the competition better. First, the level of rivalry is very high. There are many makeup brands in the market, and many of them offer similar products. Some of these brands are cruelty-free, which gives them an advantage. According to (source D), when competition is strong, companies must find ways to differentiate, and now ethics is one of the most important ways to do that. The threat of new entrants is also high. New brands can enter the market easily, especially using online platforms. Many of these new brands are cruelty-free and focus on ethical values. This makes them attractive to customers. As (source D) explains, when it is easy to enter the market, companies like MAC face more pressure and risk losing customers. Another force is the power of customers. Today, customers have more information and more options. According to (source A), people now look at company values, not only products. This gives customers more power, because they can choose brands that match their beliefs. If MAC does not meet these expectations, customers can easily switch to another brand. To go deeper, a SWOT analysis can help understand MAC’s situation :
Strengths: MAC has strong brand recognition, high product quality, and a luxury image. Many customers still trust the brand and like its variety of products. This is a big advantage, because not all brands have this level of reputation. Also, its global presence makes it more visible and accessible. Weaknesses: The main weakness is its animal testing policy. Even if it is only in some countries, customers still see it as unethical. This damages its brand image, especially in conscious markets like Quito. According to (source B), ethical perception is very important, and negative opinions can spread fast on social media. Opportunities: There is a growing demand for cruelty-free products. MAC could improve its image by changing its policies, creating new ethical product lines, or improving communication about its values. As (source A) shows, many consumers are ready to support brands that are more ethical, even if they cost more. Threats: New cruelty-free brands and strong competition are big threats. Also, social media and influencers can easily change customer perception and reduce loyalty to MAC. According to (source D), strong competition and new market trends can affect companies that do not adapt. Additionally, (source E) shows that local market conditions in places like Pichincha are changing, with more opportunities for businesses that adapt to new consumer preferences. This means MAC needs to adjust if it wants to stay competitive in Quito. If other brands adapt faster, they can take part of MAC’s market share.
According to the analysis and the survey, many people are already aware of MAC’s animal testing policy, and some of them said it changes how they see the brand. Also, more than 45% have tried or switched to cruelty-free products. This shows that ethical concerns are not only opinions, but also actions. As supported by (source A and B), customers now care more about values, and influencers help spread these ideas. From this, it can be said that the effect is moderate to high. It is not total, because MAC still has strong brand power, but it is significant, because ethics is influencing decisions more than before. If MAC does not change or adapt, this effect could become stronger in the future. Overall, ethics is now a key factor in business, and MAC needs to respond to this if it wants to keep its position in markets like Quito.
Bibliographic References
Note. Estatistical data about the awareness of MAC’s animal testing policy . Annex C Figure 3 Pie chart structured from Pingüino´s customer preference Note. Estatistical data about the preference of portion and size decrease proposal. Annex D Figure 4 Pie chart about Perception of MAC’s Brand Image
Note. Estatistical data about the preference of portion and size decrease proposal. Annex E Figure 5 Pie chart structured from Pingüino´s customer preference Note. Estatistical data about the preference of portion and size decrease proposal. Annex F
