NETHERLANDS MARKETING STRATEGY




                                 1
2
L’Oréal’s Objective in the Netherlands is to
increase Garnier’s brand presence



 • Garnier currently offers one produc...
3



L’Oréal’s Decision Criteria

 • Increase brand awareness for the Garnier
   family brands

 • Minimize cannibalizatio...
4

We recommend L’Oreal develop its products to
better suit the market’s needs


 • Short-run strategy (0-12 months)
    •...
5




Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
A high per capital income and growing number of women in 6
the workplace makes the Netherlands an attractive market



   ...
7
Accurate colour results are a major value driver
for Dutch women

    Volume growing at an annual
    rate of 15%
    46...
8
Dutch women care about natural ingredients in
their cosmetics and skin care products

                      2nd-largest ...
9




Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
10
Current International Position shows a strong
standing for both L’Oreal and Garnier

            L’OREAL               ...
11
Garnier’s Current Position in Netherlands suggests
low brand awareness


                    Operates under same divisi...
12




Market analysis
Company analysis
  Product lines
Recommendation
Implementation
Risk Mitigation
Expected Results
Con...
13

L’Oréal Recital’s declining market share can
explained by an increasingly competitive market


   Strengths          C...
14

Avoiding cannibalizing by introducing a new
product: L’Oréal Plénitude

                     Reputation for high quali...
15

Garnier Belle Couleur must be reformulated
to meet the needs of the target market

                    Only product wi...
16

Garnier Synergie offers its target market a
unique value proposition

                      Buying intentions increase...
17




Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
18

L’Oréal’s Decision Criteria
                                                 … Launch Synergie only


                ...
19




Market analysis
Company analysis
Recommendation
  Positioning
Implementation
Risk Mitigation
Expected Results
Concl...
20

Synergie will be positioned as high-performance,
high-value skin care products for women aged 20-35


      Reliable  ...
21

  Synergie and Plénitude will be positioned as high
  value for women 20 to 35 years old
                             ...
22

    Synergie and Plénitude will be differentiated on the
    basis of ingredients and demographics

 Science-         ...
23


Garnier will target the value-conscious
segment with Synergie

  Target consumer profile:
     Aged 20-35
     Recent...
24


 The positioning is aligned with capabilities, consumer
 needs and the competitive landscape

     Dutch Consumer Nee...
25




Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
26

Price the Synergie line in the mid-range to appeal to
its value-conscious target market
                              ...
27
Launching Synergie will require a high level of
coordination between sales teams and distributors




       0-2 months...
1   Prepare for Synergie launch
                                                            28




    Increase sales forc...
2 Create a beauty buzz            29




  Secure optimal shelf space
    Place near Plénitude
  Find the face of Synergie...
3 Launch time!                                         30




  Free product samples
    Mass mailing to select neighbourh...
31




Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
32

risk mitigation


                       Position Plénitude and Synergie for different target
   Cannibalization     m...
33

risk mitigation


                      Develop a clear positioning statement and build on
  Declining market    posit...
34




Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
35
Expected Results
               … Increase in L’Oréal-Garnier market share and profits



          Skin Care          ...
36
Metrics for Success
                  … Indirect metrics drive top- and bottom-line results



     Direct Metrics

   ...
37




THANK YOU
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Marketing Strategy - L'Oreal

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Marketing Strategy - L'Oreal

  1. 1. NETHERLANDS MARKETING STRATEGY 1
  2. 2. 2 L’Oréal’s Objective in the Netherlands is to increase Garnier’s brand presence • Garnier currently offers one product in the Dutch market... • How can Garnier successfully grow market presence without negatively impacting L’Oréal’s current market share?
  3. 3. 3 L’Oréal’s Decision Criteria • Increase brand awareness for the Garnier family brands • Minimize cannibalization from the introduction of Garnier products • Meet the needs of the Dutch market
  4. 4. 4 We recommend L’Oreal develop its products to better suit the market’s needs • Short-run strategy (0-12 months) • Launch Garnier Synergie skin care products • Increase L’Oréal Recital’s distribution • Long-term strategy (12-36 months) • Develop improved products for L’Oréal and Garnier • Wait and see with Synergie anti-aging skin care line
  5. 5. 5 Market analysis Company analysis Recommendation Implementation Risk Mitigation Expected Results Conclusion
  6. 6. A high per capital income and growing number of women in 6 the workplace makes the Netherlands an attractive market Fastest growing population: Age 25 or older segment Increasing number of Dutch women working 29% labor force participation for women (and growing) 4th in per capita income but 6th in per capita spending on cosmetics and toiletries Price conscious
  7. 7. 7 Accurate colour results are a major value driver for Dutch women Volume growing at an annual rate of 15% 46% of Dutch Women used hair colorant (up from 27%) Brand loyal Preference for lighter shades Permanent colorant (73%) Semi-permanent colorants Grew from 12% to 27% Fashion driven Demand for warmer shades
  8. 8. 8 Dutch women care about natural ingredients in their cosmetics and skin care products 2nd-largest sector of Dutch cosmetics Volume growth: 12% Sales growth: 16% 2.5 million Dutch women aged 15 to 65 use skin care products Consumers are brand loyal: Performance matters Loyalty increases with age Products heavily advertised and sold on the basis of brand image Market share determined by share of voice Increased interest in natural products
  9. 9. 9 Market analysis Company analysis Recommendation Implementation Risk Mitigation Expected Results Conclusion
  10. 10. 10 Current International Position shows a strong standing for both L’Oreal and Garnier L’OREAL GARNIER Largest cosmetics Independent operation manufacturer worldwide Belle Couleur Subsidiaries in over 100 Permanent hair color countries Successful in France for $6.8 billion in sales (+12%) over two decades $417 million in profits Market leader (+14%) Synergie Sales breakdown: Skin care products France: 24% Successfully launched in Rest of Europe: 42% France
  11. 11. 11 Garnier’s Current Position in Netherlands suggests low brand awareness Operates under same division as L’Oréal Garnier Currently manages one brand in the sun screen category Minimal brand presence Brand is well perceived by Dutch consumers Plénitude: A mid-market, high quality skin care product L’Oréal Recital: A high-end, high quality hair colouring product Recital is losing market share due to aggressive distribution strategy, private-label brands and salon services
  12. 12. 12 Market analysis Company analysis Product lines Recommendation Implementation Risk Mitigation Expected Results Conclusion
  13. 13. 13 L’Oréal Recital’s declining market share can explained by an increasingly competitive market Strengths Current market leader with one-third of the market No clear positioning statement Weaknesses Market share decreasing over the past two years No semi-permanent formulation To protect current market share, L’Oréal should develop a semi- permanent formula for Recital to meet market demands
  14. 14. 14 Avoiding cannibalizing by introducing a new product: L’Oréal Plénitude Reputation for high quality Strengths Anti-aging line appeals to older demographic Unclear differentiation Weaknesses Threat of cannibalization from Synergie To differentiate Plénitude from Synergie, L’Oréal should emphasize its anti-aging benefits to women 35 years and older
  15. 15. 15 Garnier Belle Couleur must be reformulated to meet the needs of the target market Only product with a strong positioning statement Strengths Positioning statement resonates with Dutch women Current colours are too dark for Dutch women Weaknesses Positioning statement is not consistent with results Buying intentions decreased after use Belle Couleur is unable to meet market needs; Garnier should delay its launch until product improvements are made
  16. 16. 16 Garnier Synergie offers its target market a unique value proposition Buying intentions increased after use Strengths Different positioning from Plénitude Dutch market is very competitive Weaknesses Need to maintain share of voice to maintain market share Garnier should launch Synergie skincare without anti-aging line and emphasize natural ingredients that are scientifically proven
  17. 17. 17 Market analysis Company analysis Recommendation Implementation Risk Mitigation Expected Results Conclusion
  18. 18. 18 L’Oréal’s Decision Criteria … Launch Synergie only Launch Belle Launch Launch Both Launch Neither Couleur Synergie Increase Garnier’s brand awareness Minimizes threat of cannibalization Meets Dutch market needs
  19. 19. 19 Market analysis Company analysis Recommendation Positioning Implementation Risk Mitigation Expected Results Conclusion
  20. 20. 20 Synergie will be positioned as high-performance, high-value skin care products for women aged 20-35 Reliable Natural Smart Choice Synergie is a worry-free, natural skincare line for young women who care about healthy skin. High Value High Performance Understated
  21. 21. 21 Synergie and Plénitude will be positioned as high value for women 20 to 35 years old Performance Middle/ High Upper Value Ellen Betrix End Synergie Yves Rocher Plénitude Dr. vd Hoog Oil of Olaz Price Low High Nivea Visage Ponds Lower Dead End End Low
  22. 22. 22 Synergie and Plénitude will be differentiated on the basis of ingredients and demographics Science- Science Science- Youth Mature Plénitude Ellen Betrix Oil of Olaz Ponds General Anti- Purpose Aging Synergie Nivea Visage Dr. vd Hoog Yves Rocher Natural- Natural- Youth Mature Nature
  23. 23. 23 Garnier will target the value-conscious segment with Synergie Target consumer profile: Aged 20-35 Recently graduated university and started working Has tried multiple skin care brands with mixed results (not brand loyal) Looking for brand to use with consistent results Value and performance conscious but not brand focused Thinks natural ingredients are better for skin Unfamiliar with technical product descriptions and terms
  24. 24. 24 The positioning is aligned with capabilities, consumer needs and the competitive landscape Dutch Consumer Needs Competitive Landscape Growing consumer segment that is No direct competitor in high- value conscious and cares about value segment natural ingredients Synergie Positioning Synergie is a worry-free, natural skincare line for young women who care about healthy skin. Company Capabilities “Alliance of science and nature” – natural products that don’t sacrifice performance
  25. 25. 25 Market analysis Company analysis Recommendation Implementation Risk Mitigation Expected Results Conclusion
  26. 26. 26 Price the Synergie line in the mid-range to appeal to its value-conscious target market Performance Middle/ High Value Synergie Product Line Price Plenitude Dr. vd Hoog 10-11.95 Synergie (Garnier) 9.95-16.95 Oil of Olaz 12 Dr. vd Hoog Price Plénitude (L’Oréal) 10.95-19.95 Oil of Olaz Low Synergie should be priced below Plénitude to target younger demographic Low
  27. 27. 27 Launching Synergie will require a high level of coordination between sales teams and distributors 0-2 months 2-4 months 4-12 months 1 2 3 Prepare Create a beauty buzz Launch time! Customize literature Educate target Free product trials Train new hires market Advertisements Sell bundling option to retailers
  28. 28. 1 Prepare for Synergie launch 28 Increase sales force Training period of two months Define sales incentives Distribution strategy: Leverage current distribution network Grocery stores and chain drug stores in densely populated urban areas Incentivize retailers with L’Oréal-Garnier bundling option
  29. 29. 2 Create a beauty buzz 29 Secure optimal shelf space Place near Plénitude Find the face of Synergie Dutch celebrity spokeswoman Educate about benefits of natural ingredients PR efforts with women`s magazines and local TV stations
  30. 30. 3 Launch time! 30 Free product samples Mass mailing to select neighbourhoods Local charity events Product demonstrations Shopping malls located near distribution outlets Outdoor advertising Public transit, bus shelters, shopping malls
  31. 31. 31 Market analysis Company analysis Recommendation Implementation Risk Mitigation Expected Results Conclusion
  32. 32. 32 risk mitigation Position Plénitude and Synergie for different target Cannibalization markets of Plénitude sales Even with some cannibalization, overall L’Oréal-Garnier market share will still increase First-mover advantage in high-quality, high-value Highly natural segment – gain share before others can enter competitive skin Emphasis on natural positioning for Synergie – care market increase reluctance to switch due to possible allergic reaction
  33. 33. 33 risk mitigation Develop a clear positioning statement and build on Declining market position as current market leader share for Recital Introduce semi-permanent formulation to meet market demands Lost opportunity Still no competitors in the mid-range hair colour market for mid-range Reformulate Belle Couleur to increase chance of hair colour successful launch in future
  34. 34. 34 Market analysis Company analysis Recommendation Implementation Risk Mitigation Expected Results Conclusion
  35. 35. 35 Expected Results … Increase in L’Oréal-Garnier market share and profits Skin Care Hair Colour Dutch skin care market: Permanent hair colour market: 2.5 million consumers 1.7 million consumers 56 million guilders 88 million guilders 10% market share for L’Oréal- 30% market share for Recital = Garnier = 5.6 million guilders 26 million guilders Plénitude 5% Synergie 5% 32 million guilders in revenue  2 million in profits
  36. 36. 36 Metrics for Success … Indirect metrics drive top- and bottom-line results Direct Metrics • Profitability • Revenue • Sales volume • Market share Indirect Metrics • Retailer penetration • Retail and wholesale margins • Market share versus share of voice • Brand awareness and consumer purchase intention
  37. 37. 37 THANK YOU
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