Our DIGITAL intelligence at L'OREAL's service_Connected Life 2014

What is CONNECTED LIFE and its added value for L’OREAL?
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Digital intelligence at your service
- introducing Connected Life 2014 -
Media fragmentation is often described as
the biggest brand challenge of the digital age.
In reality, it’s the greatest opportunity.

Digital intelligence at TNS
- Connected Life outlined -
Including:
1. Geographic scope
2. Purpose & added value
3. Key questions answered
4. Digital consumer segmentation

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Connected Life 2014 explores how technology is transforming
the lives of consumers across the planet
Covering regular internet users in 50 markets around the world, the Connected Life study offers essential insight
into the impact of the growing digital ecosystem on the media landscape.
It uncovers new and exciting opportunities for marketers to connect with their consumers in this increasingly
complex environment.
WHERE
A en voir l'intense
activité autour des blogs
beauté, des tutoriaux
maquillage, des avis
et échanges sur les
réseaux sociaux autour
de la Beauté, envie des
femmes de se sentir
belle ne se dément pas.
Mathilde Lion, NPD Beauty
Industry Expert
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Connect with your consumers on a whole new level
As consumers move across multiple
channels and adopt more advanced
devices, targeting becomes a more
complex task.
Indeed, a fragmented landscape demands
a shift in focus - the question is no longer
‘how can I reach my consumer?’ but ‘how
can I reach my consumer at a time when
my brand is most relevant to them?’.
Understanding local preferences and
touch-point patterns allows to target
individuals and groups far more precisely,
and to deliver against long- and short-
term marketing objectives with greater
accuracy.
Connected Life is about better
decision making in a connected world.
WHY
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Each Connected Life report is structured around
key questions facing today’s marketers
How has the digital ecosystem developed? How should brand strategies adapt?
Role of digital in driving
Brand activation
To what extent is online
research and purchase
prevalent across categories?
What are the barriers and
drivers of eCommerce?
What’s the share of voice for
digital and social channels
throughout the P2P?
How do these paths change
across segments?
Role of digital in increasing
Brand awareness
What do consumers use these
devices for? What content or
services do they access, why?
What is the incremental reach
of different digital channels?
What are the key market
trends? Where are markets
going and how quickly are they
changing?
How does this compare across
segments?
Role of digital in the overall
Media Landscape
Research Questions
What does the device
infrastructure look like either
locally or globally?
What is the interaction
between devices and media?
What does a day in the life of a
digital consumer look like
across the world?
What are the different types of
digital segment that exist
across markets?
Role of digital in
Brand building
How do digital consumer
behaviours, attitudes, needs
and motivations change across
categories?
What channels or routes of
engagement are used?
What content needs exist
across categories?
How does this compare across
targets, categories and
markets?
1.
How has the growing
digital ecosystem
impacted media habits?
2.
What is the reach of
digital platforms and
channels?
3.
How and why do
consumers engage with
brands?
4.
How digital is the
Path to Purchase?
HOW
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In addition, the study guides marketers with a segmentation
developed along two strategic axes
LowHigh
Digitalinfluence
Low High
Social engagement
LeadersObservers
Functionals Connectors
To what extent should I focus on
digital, rather than other channels?
The answer to this question is based on
the level of influence digital channels
hold, which grows with improving
access. The more devices or bandwidth
a consumer has, the more time they
will spend online and the more
influential the medium becomes.
Where should this focus be? On
social and earned media or owned
and paid?
The answer to this questions is less
clear cut as it is more closely linked to
attitudes than access, but wherever
consumers have a stronger attachment
to social channels they will play a more
important role.
WHAT
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Digital innovation at L’OREAL
- Internet sourced -
Including:
1. Creativity, content & connectivity
2. Digital media
3. Ecommerce

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Creativity, content & consumer connectivity at
Countless Google searches
regard Beauty. Beauty, with its
tendency to foster dialogue and
connection, suggests a high degree
of affinity between what the L’Oréal
Group does and what the digital has
to offer.
The Group also uses online as
the most reliable touch-point to
reach the highly dynamic and
increasingly more affluent middle
class in emerging markets.
To begin with, Internet is a
great tool for delivering
personalised services (such as –
for example - the "L’Oréal Paris
Make-up" app which was launched
in 2011 and which transforms a
tablet into a professional make-up
studio).
Moreover, social networks allow
L’Oréal brands to leverage the
viral power of loyal (brand and/or
product) advocates’, bloggers’,
vloggers’ and star ambassadors’
recommendation and
word-of-mouth.
L’Oréal, the world's largest
cosmetics company, is thus always
on the lookout for new opportunities
to create proximity with
consumers in a yet more
creative, relevant and efficient
way.
01 02
04 0305
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Digital media at
For example, L’Oreal looks into
virtual reality as one of the
biggest digital trends. The mobile
app "Makeup Genius", already
launched in France, the U.S. and
China, help evaluate a new make-
up offer without having to apply a
single cosmetic product.
L’Oréal spends 13% of its net
media investment on digital
media. Its online share of voice is
set to increase from 20 to over 200
websites.
Makeup Genius is the
California-based Connected
Beauty Incubator’s first
product. The breakthrough app
was released only 18 months after
L’Oréal had initiated the incubator.
Consequently, all flagship
websites (e.g. YSL Beauty,
Clarisonic and em - a pure player
brand designed with the YouTube
star vlogger, Michelle Phan) are to
use the common DemandWare
framework that enables brand
fans to create their own
personalised estores.
It is the "Digital Factory", a
50-person large internal expert
team, that is in charge of driving
the digital revolution at L’Oréal and
placing the consumer at the
heart of the online site creation.
06 07
09 0810
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Ecommerce at
L’Oréal’s efforts to boost online
purchase rates pay back already:
the Group’s ecommerce results
are up by 25% (owned estores
only).
Yet, ecommerce performance is
far from geographically
homogenous: many markets
have their own local patterns in
terms of Internet penetration,
device ownership, security, payment
methods and logistics.
To benefit from local expertise,
Best Practice cases are being
identified worldwide: Japan for
mcommerce (at 30% of the
country’s online sales), China for
Net Promoter Score and the U.S.
for conversion funnel (soon retooled
with Shoppable?).
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After the digital media and the
ecommerce sites, connected
objects are under consideration
at L’Oréal (possibly all the more so
since the recent snatching of the
Kering’s Puma licence from the
American competitor, P&G?).
Meanwhile, at the Ecommerce
One to One event in Monaco,
Vincent Stuhlen, International
Digital Director for L’Oréal Luxe,
presented the roadmap towards
digitalisation of the brand
portfolio, aimed at achieving -
by 2017 - 8% of sales via the
ecommerce (5% currently).
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L’OREAL’s challenge
- based on publically available data -
Including:
1. Globalisation
2. Customisation

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Challenge: To move L’Oréal from product company towards product+service company*
The Group’s digital revolution breaks out internally
with the major focus on operational
excellence to be attained via cutting-edge
technology (common platform) and employee
support («Digital that works» training module for
500 marketing and sales staff).
At the heart of the revolution lies the need to
explore digital horizons in an effort to build ever
tighter ties with (existing and potential
future) consumers.
To fully benefit from the existing in-house
expertise, local best practices should be
investigated closely in order to understand their
roll-out feasibility.
Operational excellence leading to
consumer centric digitalisation
* Lubomira Rochet , L’Oréal Chief Digital Officer
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Quiz: Based on findings below, would you propose the same media mix for South Korea and
Nigeria?
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Exploring today’s local patterns…
- non-exhaustive illustration -
Including:
1. Japan
2. China
3. The U.S.

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Breadth of findings
(as delivered by all Connected Life reports)
Patterns in
media
consumption
& device
choice
■ xx% of the total market in Japan uses Internet at least once a week
■ xx is the main access point to online for all age groups although younger consumers are spending more time
on xx
■ Mobile-centric internet users tend to be…
■ Japan’s xx consumption remains high. There are, however, xx% of consumers who are shifting their…
■ Online xx and xx sites have the widest reach in Japan – weekly usage is at xx% and xx% respectively for
these activities
■ Japanese internet users prefer to use xx to communicate online (xx%), ignoring the global trend towards xx
■ xx dominates as the top social platform in Japan followed by xx, xx and xx
■ Consumers are online throughout the day, but usage drops off during xx, when xx dominates
Online
content &
channel
preference
Attitudes
towards
ecommerce &
connected
objects
■ Japanese consumers have a high incidence of purchasing online (across segments)
■ xx will drive eCommerce sales across categories
■ To recruit, ensure xx and xx and offer xx
■ Compared to other markets, there is not a big opportunity to introduce xx
■ In the Personal Care category, consumers engage with brands they 'like', enabling those with strong equity to
deepen this bond by engaging brand fans online
■ Personal Care has a xx level of research and any research conducted is xx
■ xx and xx play an important role
Path to
Purchase in
the Personal
Care category

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Example_1: Optimise your media plan
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© TNS
Example_2: Prioritise the right digital channels

… for globally connected future
Including:
1. Example of cross-market data
2. Case study

© TNS
Case study: L’Oreal Ombre
Case of leveraging multi-platform incrementalism and mobile centrism
to boost brand/product relevance in the eyes of the target
Source: Mobile Marketer 2014 – L’Oreal personalises mobile ads by hair colour to drive relevancy (Link)
Business issue
Users access more content across multiple devices, but
online clutter and differing screen sizes create a challenge
for marketers
Action
Beauty brand L’Oreal incorporated GumGum’s photo
recognition technology to pick up on the hair colors of
models or actors in content users were viewing. Hair
colour was then reflected in ads for their Ombre colour line
An in-ad slider tool was incorporated so users could easily
view multiple, personalised options
The campaign was delivered seamlessly with the same
user experience across PC or mobile platforms
Result
By linking content users were interested in to a distinct
style and colour, L’Oreal created a more personalised
ad, in sync with user preferences
The approach
L’Oreal utilised photo recognition technology to drive
greater engagement with online advertising, regardless
of how content was accessed
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© TNS
Contact our TNS Team to set up a digital meeting and learn more!
Cecile Hayat - Consumer Department Director, B&C Digital Lead
Cecile.Hayat@tns-sofres.com
0140926651
Jacques Latreille – Global Account Director, L’Oréal
Jacques.Latreille@tns-sofres.com
0140923318
Guénaë
lle
Guenaelle Gault – International Digital Director, Southern Europe
Guenaelle.Gault@tns-sofres.com
0140924527
Constance Leroy – Head of Consumer Department, Brand&Communication
Constance.Leroy@tns-sofres.com
0140924627
Karolina Gniewowska – Research Director, Consumer Digital Lead
Karolina.Gniewowska@tns-sofres.com
0140924707
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© TNS
Bibliography
La révolution digitale chez l’Oréal (24/04/2014)
http://magazine.loreal-finance.com/fr/la-revolution-digitale-chez-
loreal.htm
L’Oréal prépare des objets connectés pour le parcours beauté (26
mars 2014) http://www.larevuedudigital.com/2014/03/actu/loreal-
prepare-des-objets-connectes-pour-le-parcours-
beaute/?relatedposts_hit=1&relatedposts_origin=5431&relatedpost
s_position=1
L’Oréal planche sur la convergence technologique de ses
plateformes digitales (28 juin 2014)
http://www.larevuedudigital.com/2014/06/digital/loreal-travaille-a-
la-convergence-technologique-de-ses-marques-a-lheure-du-digital/
Pré-visualiser son maquillage en réalité virtuelle, avec la nouvelle
App l’Oréal (16 mai 2014)
http://www.larevuedudigital.com/2014/05/directionmarketing/pre-
visualiser-son-maquillage-en-realite-virtuelle-avec-la-nouvelle-app-
loreal/
"Le défi de notre incubateur, c'est d'insuffler l'esprit start-up à
l'énorme organisation L'Oréal", selon Guive Balooch (02 juin 2014)
http://www.usine-digitale.fr/article/le-defi-de-notre-incubateur-c-
est-d-insuffler-l-esprit-start-up-a-l-enorme-organisation-l-oreal-
selon-guive-balooch.N266210
Jean-Paul AGON, Chairman and CEO (September 18th 2014)
http://www.loreal-finance.com/_docs/pdf/autres-
evenements_PAI/2014/Cheuvreux.pdf
[E-Commerce One to One] L'Oréal révolutionné par le digital
(19/03/2014)
http://www.ecommercemag.fr/Thematique/strategies-omni-canal-
1009/strategies-10040/Breves/Oreal-revolutionne-digital-
234758.htm
Conférence L’Oréal " Flagship Digital : the ultimate customer
experience » (19 mar 2014)
http://blogecommerce1to1.com/2014/03/conference-loreal-
flagship-digital-the-ultimate-customer-experience/
YSL Beauté dévoile les coulisses de son nouveau site (24 MARS
2014) http://michellephan.com/em-cosmetics-goes-international/
L'Oreal Retools Online Shopping Cart Thanks to Digital Mentorship
Effort (September 16, 2014)
http://adage.com/article/cmo-strategy/l-oreal-retooled-online-
shopping-cart/294955/
L'Oreal goes back to the future with content marketing agenda (10
February, 2014)
http://www.cmo.com.au/article/537719/l_oreal_goes_back_future_
content_marketing_agenda/
Personalization is key for beauty omnichannel strategy: L’Oreal
Luxe exec (January 17, 2014)
http://www.luxurydaily.com/personalization-is-key-for-beauty-
omnichannel-strategy-loreal-luxe-exec/
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Our DIGITAL intelligence at L'OREAL's service_Connected Life 2014

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