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L'oreal Case Study
L'Oréal, founded in 1909, has evolved into the largest beauty and cosmetics company through continuous innovation and a diverse product portfolio. The company has faced challenges such as a declining haircare segment and high competition while adapting to market demands with effective branding and localized strategies. Future growth strategies include focusing on e-commerce, launching organic products, and leveraging joint ventures to enhance market share.
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L'oreal Case Study
- 1. Because you’re worthit. THE BACKSTAGE STORY
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- 4. Founded in 1909,L’Oreal coupled innovation and speed to market with expansion of it’s geographic consumer base. In 1907, Eugene Schueller developed Aureole, a hair colour formula. He developed it, manufactured it and sold it to a Parisian hairdresser. In 1957, Francois Dalle, initiated the concept of selling beauty through various channels. In 1988, Lindsey Owen Jones focused on 5 core businesses (hair colour & care, skin care, fragrances & cosmetics). The firm had to promote it’s national brands to the world.
- 5. Integrity Respect Courage Transparency Brand Philosophy Because You’reWorth It! CORE BRAND VALUES Because you’re worth it.
- 6. Global Leader inBeauty and Cosmetics
- 7. L’OREAL SWOT ANALYSIS STRENGTHS: •Largest Beauty/cosmetics company. • Continuous R&D • Fantastic product and brand portfolio • High Quality products • Strong integrated marketing communications • Really good stars in brand portfolio • Widespread distribution • Natural and organic in nature WEAKNESSES: • Too many subdivisions • Haircare is a degrowing segment. • Profit margins are lower.
- 8. L’OREAL SWOT ANALYSIS OPPORTUNITIES: •Market Potential for personal care and beauty items is only going to increase • Product mix expansion • Demand for organic cosmetics • Revival of Body Shop THREATS: • Dynamic nature of cosmetics industry • Cash Crunch
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- 10. Local and GlobalCompetitors L’Oreal has now grown globally and faces steep competition in the US markets as well as in India and China due to high market share, competitive pricing, loyal consumer base. Shiseido – a Japanese cosmetic giant, which competes globally Avon – local as well as global Competitor Estee Lauder – Local and international competitor Proctor & Gamble – International Competitor
- 11. Success in globalmarkets • It’s glamorous and stylish, successfully capturing the attention of smart, driven women. Extraordinary distribution channel to the US, South America, Russia and the Far East. • Diversification into wide range of beauty products. • Expanded globally by introducing Maybelline in USA. • L’Oreal successfully set up the Geo Cosmetics in Asian Markets to study the local needs • Evaluation centres around the world to study global habits • Local teams change and modify L’Oreal products. • Company Launched the legendary advertisement campaign “Because I am worth it” for promotion of a hair color. • Due to it’s constant R&D and smart acquisitions it has stayed as a market leader.
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- 14. Review L’Oreal’s brandportfolio. What role have target marketing , smart acquisitions and R&D played in growing of those brands? • We have seen the brand portfolio and acquisitions in the previous slides. • Apart from them the following factors played an important role: • Precise target marketing • Targeting dynamic markets • Niche Marketing • Psychographic Segmentation • Spends 3% of annual sales on R&D
- 15. What has beenthe key to successful product launches such as Maybelline’s Wondercurl in Japan? • Evaluation centres are set up around the world to study global habits. • Local teams change and modify L’Oreal products. • Innovation in Marketing-14 Research centres around the world ,it caters to the local needs of each market.
- 18. WHAT’S NEXT? • GLOCAL! AsGilles Weil said “You have to be local and as strong as the best locals ,but backed by an international image and strategy” • Joint Ventures-would increase company’s market share and profit
- 19. If you werethe CEO how would you sustain the company’s global leadership? • The company would focus on e-commerce and develop a strong online market • The company would launch organic products • Can go for ore prospective distribution
- 20. SUMMARY: • L’Oreal’s BrandHistory • Products • Core Brand Values • SWOT Analysis • Brand portfolio • Competition • Global Success • Q & A
- 21. DISCLAIMER Created by VaidehiMahajan, IIT Bombay as a part of a marketing internship done under Prof. Sameer Mathur, IIM Lucknow.
Editor's Notes
- #3 Loreal products
- #4 Products
- #5 About Loreal
- #6 Core brand values “Our principles are Integrity, Respect, Courage & Transparency. Our ethical principles shape our culture, underpin our reputation and are known and recognised by all our employees. We believe in integrity because acting with integrity is vital to building trust and maintaining good relationships.
- #7 Global Leader in beauty and Cosmetics
- #8 http://www.marketing91.com/swot-analysis-loreal/
- #9 Product mix expansion – Expanding the product lines as well as introducing new products in the product mix will result in the complete product mix expansion – something which will be the target of L’oreal management as well.