EXECUTIVE SUMMARY The project is a peek at L’Oreal Paris. It is a French cosmetics cosmetics and and beauty beauty company, company, headquartered in Clichy, auts!de!"eine. auts!de!"eine. It is the #orld$s lar%est cosmetics company, and has a re%istered o&&ice in Paris Paris.. It has de'eloped acti'ities in the &ield o& cosmetics, concentratin% on hair color , skin care, sun protection, per&umes protection, per&umes and hair hair care, care, make up, the company is acti'e in the dermatolo%y dermatolo%y,, to(icolo%y to(icolo%y,, tissue en%ineerin%, en%ineerin%, and biopharmaceutical and biopharmaceutical research research &ields and is the top nanotechnolo%y patent!holder p atent!holder in the )nited "tates. This project looks at the "*OT analysis o& L’Oreal, L’Oreal, its international marketin% strate%ies, its competitors’ in in international market, L’Oreal L’Oreal brandin% strate%ies etc.
1
Introduction To L’Oreal The L’Oreal Group is a French cosmetics and beauty and beauty company, company, headquartered in Clichy, auts! de!"eine.. It is the #orld$s lar%est cosmetics company, and has a re%istered o&&ice in Paris de!"eine Paris.. It has de'el de'elope oped d acti' acti'it itie iess in the the &iel &ield d o& cosme cosmeti tics cs,, conce concent ntra rati tin% n% on hai hairr col color or , skin skin care, care, sun protection, per&umes protection, per&umes and hair hair ccare,
make
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the
company
is
acti'e
in
the dermatolo%y dermatolo%y,, to(icolo%y to(icolo%y,, tissue en%ineerin%, en%ineerin%, and biopharmaceutical and biopharmaceutical research research &ields and is the top nanotechnolo%y patent!holder in the )nited "tates.
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HISTORY In +-, u%/ne "chueller , youn% French chemist o& 0erman descent, de'eloped a hair dye &ormula called Auréale. "chueller &ormulated and manu&actured his o#n products, #hich he then sold to Parisian hairdressers. On 1+ 2uly ++, "chueller re%istered his company, the "oci3t3 Fran4aise de Teintures Ino&&ensi'es pour Che'eu( 5"a&e air 6ye Company o& France7. The %uidin% principles o& the company, #hich e'entually became L’Or3al, #ere research and inno'ation in the &ield o& beauty. In +8-, the company employed three chemists. 9y +:-, the teams #ere +-- stron%; that number reached +,--- by +<= and is nearly 8-,--- today. "chueller pro'ided &inancial support and held meetin%s &or La Ca%oule at L$Or3al headquarters. La Ca%oule #as a 'iolent French &ascist!leanin% and anti!communist %roup #hose leader &ormed a political party >ou'ement "ocial ?3'olutionnaire 5>"?, "ocial ?e'olutionary >o'ement7 #hich in Occupied France supported the @ichy collaboration #ith the AaBis. L$Or3al hired se'eral members o& the %roup as e(ecuti'es a&ter *orld *ar II, such as 2acques Corr/Be, #ho ser'ed as CO o& the )nited "tates operation. This in'ol'ement #as e(tensi'ely researched by >ichael 9ar!ohar in his book, Bitter Scent . L’Or3al %ot its start in the hair!colour business, but the company soon branched out into other cleansin% and beauty products. L’Or3al currently markets o'er :-- brands and many thousands o& indi'idual products in all sectors o& the beauty businessD hair colour, permanents, hair stylin%, body and skin care, cleansers, makeup and &ra%rances. The company$s products are &ound in a #ide 'ariety o& distribution channels, &rom hair salons and per&umeries to hyper ! and supermarkets, healthEbeauty outlets, pharmacies and direct mail. L’Or3al
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#orld#ide research
FranceD ulnay and Che'illy;
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de'elopment centresD
the ).".D Clark , Ae#
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2ersey;
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in 2apanD Ga#asaki,Gana%a#a Pre&ecture; in 8--: one #as established in "han%hai, China, and one in India. &uture &acility in the )" #ill be in 9erkeley ei%hts, Ae# 2ersey.
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From +<< to +<, L’Or3al controlled the &ilm company Para'ision, #hose properties included the Filmation and 6e Laurentiis libraries. "tudioCanal acquired the Para'ision properties in +=. L’Or3al purchased "ynth3labo in +H1 to pursue its ambitions in the pharmaceutical &ield. "ynth3labo mer%ed #ith "ano&i in + to become "ano&i!"ynth3labo. "ano&i!"ynth3labo mer%ed #ith 'entis in 8--= to become "ano&i!'entis. On +H >arch 8--, L$Or3al purchased cosmetics company The 9ody "hop &or J:8 million. L$Or3al$s ad'ertisin% slo%an is K9ecause I$m #orth itK. In the mid!8---s, this #as replaced by K9ecause you$re #orth itK. In late 8--, the slo%an #as chan%ed a%ain to K9ecause #e$re #orth itK &ollo#in% moti'ation analysis and #ork into consumer psycholo%y o& 6r. >a(im Titorenko. The shi&t to K#eK #as made to create stron%er consumer in'ol'ement in L$Or3al philosophy and li&estyle and pro'ide more consumer satis&action #ith L$Or3al products. L$Or3al also o#ns a air and 9ody products line &or kids called L$Or3al Gids, the slo%an &or #hich is K9ecause #e$re #orth it tooK. In +arch 8--<, L$Or3al acquired 1 "uisse$s stake, takin% sole control o& the company. In Ao'ember 8-+1, L$Or3al announced that Le Club des Cr3ateurs de 9eaut3 #ould cease acti'ity in the &irst hal& o& 8-+=. In Ao'ember 8-+8, L$Or3al inau%urated the lar%est &actory in the 2ababeka Industrial Park, Cikaran%, Indonesia, #ith a total in'estment o& )"+-- million. The production #ill be absorbed 8: percent by domestic market and the rest #ill be e(ported. In 8-+-, si%ni&icant %ro#th occurred at Indonesia #ith + percent increase o& unit sales or 8< percent o& net sales. In 2anuary 8-+=, L’Or3al &inalised the acquisition o& major Chinese beauty brand >a%ic olidin%s &or <=- million.
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On ++ February 8-+= it #as announced that L$Oreal had sealed a deal #orth M1.=bn to buy back eyers &amily’s stake #ill increase &rom 1-.pc to 11.8pc. Aestle has o#ned a stake in L’Oreal since +H= #hen it bou%ht into the company at the request o& Liliane 9ettencourt, the dau%hter o& the &ounder o& L’Oreal and #orld$s richest #oman, #ho #as tryin% to pre'ent the French state$s inter'ention in the company. On 8- February 8-+=, "hiseido a%reed to sell its Carita and 6ecl3or brands to L’Or3al &or M88H.: million 5)"1+8.1 million 58-+=77. On +< 2une 8-+=, L$Or3al a%reed to acquire A Cosmetics &or an undisclosed price, bolsterin% its makeup o&&er in Aorth merica #here its consumer!products unit has &altered. In "eptember 8-+=, L’Or3al announced it had a%reed to purchase 9raBilian hair care company Aiely Cosmeticos 0roup &or an undisclosed amount. In 8-+:, "oo 2oo Park became L’Or3al$s &irst sian!merican %lobal spokesmodel
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L’OREAL MISSION For more than a century, #e ha'e de'oted our ener%y and our competencies solely to one businessD beauty. It is a business rich in meanin%, as it enables all indi'iduals to e(press their personalities, %ain sel&!con&idence and open up to others.
eaut! i" a lan#ua#e $ L’Oreal has set itsel& the mission o& o&&erin% all #omen and men #orld#ide the best o& cosmetics inno'ation in terms o& quality, e&&icacy and sa&ety. 9y meetin% the in&inite di'ersity o& beauty needs and desires all o'er the #orld.
eaut! i" uni%er"al$ "ince its creation by a researcher, the %roup has been pushin% back the &rontiers o& kno#led%e. Its unique ?esearch arm enables it to continually e(plore ne# territories and in'ent the products o& the &uture, #hile dra#in% inspiration &rom beauty rituals the #orld o'e r.
eaut! i" a "cience$$ 6
Pro'idin% access to products that enhance #ell!bein%, mobiliBin% its inno'ati'e stren%th to preser'e the beauty o& the planet and supportin% local communities. These are e(actin% challen%es, #hich are a source o& inspiration and creati'ity &or L’Oreal.
eaut! i" a co&&it&ent$ 9y dra#in% on the di'ersity o& its teams, and the richness and the complementarity o& its brand port&olio, L’Oreal has made the uni'ersaliBation o& beauty its project &or the years to come.
L’Oreal' o((erin# )eaut! (or all
L’OREAL OUR ETHICAL PRINCIPLES
Our principles are Inte#rit!' Re"pect' Coura#e and Tran"parenc!.
Our thical Principles shape our culture, underpin our reputation, and must be kno#n and reco%nised by all L’Or3al employees. Inte#rit! because actin% #ith inte%rity is 'ital to buildin% and maintainin% trust and %ood
relationships. 7
Re"pect because #hat #e do has an impact on many people’s li'es. Coura#e because ethical questions are rarely easy but must be addressed. Tran"parenc! because #e must al#ays be truth&ul, sincere and be able to justi&y our actions and
decisions.
*RO+UCT RANGE O, L’Oreal
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9
10
S-IN CARE RANGE •
S-IN NEE+S
o
nti!a%in%
o
*hitenin%
o
ydration
o
)@ protection
o
>ake!)p ?emo'er
•
RAN+
o
?e'itali&t
o
outh code
o
*hite Per&ect
o
ydra Fresh
o
)@ Per&ect
o
>ake!)p ?emo'er
o
"kin Per&ect
o
0o 1-
o
(traordinary Oil
•
*RO+UCT TY*E
o
Cleanser Q toner
o
"erum
o
6ay moisturiBer
o
Ai%ht moisturiBer 11
o
ye cream
o
)@ protection cream
o
"crub
o
)@ Protect Face >ist
o
Face Oil
o
Po#er *ater
o
6ay Cream
COSMETICS •
,ACE
o
9ase
o
Liquid Foundation
o
Compact
o
9lush
o
99 Cream
o
Concealer
•
EYES
o
>ascara
o
ye shado#
o
yeliner
•
RAN+
o
Color ?iche
o
True >atch
o
In&allible Lipsticks
o
Colour In&allible
12
o
"uper Liner
o
9ase >a%ique
o
Lucent ma%ique
o
Lash rchitect
o
Caresse
o
Pure ?eds
o
>at >a%ique
•
LI*S
o
Lipstick
o
Lip0loss
o
Lip Liner
•
o
NAILS Aail rt
HAIR CARE •
HAIR TY*E
o
6ama%ed air
o
air Fall
o
Aourished air
o
6ull air
o
Colored air
o
6ry hair
•
o
*RO+UCT TY*E "hampoo
13
o
Conditioner
o
>asque
o
Tonic
o
Oil
o
"erum
•
RAN+
o
Total ?epair :
o
Fall ?epair 1
o
Oil Aourish
o
Color Protect
o
Autri!0loss
o
"mooth Intense
o
Fall ?esist
HAIR COLOR •
+ESIRE+ COLOR
o
9ro#n
o
9lack
o
9ur%undy
o
Fashion
•
*RO+UCT TY*E
o
Permanent
o
"emi!Permanent Q Ao mmonia
•
o
RAN+ (cellence Cr/me 14
o
Castin% Cr/me 0loss
MEN S-IN CARE •
NEE+
o
Oil Control
o
6ull Q Tired "kin
•
*RO+UCT TY*E
o
Cleanser
o
>oisturiBer
o
"ha'in%
•
RAN+
o
ydra ner%etic
o
*hite cti'
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L’Oreal International Mar.etin# Strate#! The purpose o& this report and its study is concentrated to ha'e a %limpse and understandin% o& International marketin% strate%y. In this report, I #ill discuss the issue encompassin% L$Oreal and its %lobal marketin% strate%y. The subject concentration in this report limits its analysis on the theme o& $International >arketin% "trate%y$ o& L$Oreal, and ho# the company as a %lobal >AC in cosmetic manu&acturin% and sales is strate%iBed %lobally. For the purpose o& this #ork, L$Oreal is selected because the company has its market presence in almost all part o& the %lobe. Its products and the quality that it o&&ers to consumers are also assumed to be one o& the %reatest stren%th o& the company. In terms o& the sales &i%ures as #ell, the company is #ell ahead in the leader sta%e. Thus, takin% this back%rounds into consideration, it is thus clari&ied that the attempt o& this #ork is theoretical in nature, #hich means that research analysis o'erall is secondary in nature and does not in'ol'es primary research. 6ata required &or the research is %athered &rom rele'ant source as &easible to justi&y the case assumption. It is also important to note that international marketin% strate%y and its literature also is bein% used e(tensi'ely as a resource, so as to understand the concepts and its theoretical meanin%. In doin%, it &acilitates a research on the subject matter that is in!depth to some e(tent and lo%ically sounds in its presentation. "tructurally, the paper is arran%ed in streamlined manner startin% #ith the introduction about the 16
company, so as it %i'es us the %limpse about the company o'erall. It is &ollo#ed by de&inin% the meanin% o& %lobal marketin% strate%y, so as the attempt o& this #ork is streamlined and speci&ically meets the objecti'e criteria o& the research subject de&ined abo 'e.
Introduction L$Oreal international is a %roup o& companies #ith its branches and subsidiary companies scattered across the %lobe. L$Oreal is considered to be one o& the bi%%est cosmetic manu&acturers in the #orld today. KL$Oreal " Paris is the #orld number one cosmetic company specialiBin% in the de'elopment and manu&acturin% process o& hair care, hair color, skin care, color cosmetics and &ra%rance &or consumer and pro&essional market.K 52ames " O$?ouke, 8-++, p. 187 In terms o& its sales &i%ure and market presence %lobally, L$Oreal as a corporation is tremendously hu%e. The company #as &ounded many decades back. ccordin% to the data that can be %athered, it is belie'ed that L$Oreal #as &ounded by KFrench chemist named u%ne "chueller in the year +-H. The said chemist and &ounder o& L$Oreal is also a reno#ned in'entor o& &irst e'er hair colorant or dye in its synthetic nature, #hich re'olution the beauty and salon industry.K 5L$Oreal7 The company #as &ounded Kin France and has many interestin% history attached to it #hen 'ie#ed &rom a cultural perspecti'e. In the early part o& ++-, #omen in Paris #ere 'ery obsessed #ith hair colorin% and dye. 0i'en the hypes in such aspects, French chemist Fu%ne "chueller in'ented the &irst e'ery hair dye in synthetic. nd since then the &oundation o& L$Oreal happened, and it #as a time that the company ne'er looked back. It is also interestin% to note that the company #as &inally incorporated on +1K 5Fundin%)ni'erse7 "tartin% &rom the year +-H, Ktoday L$Oreal is the #orld lar%est cosmetic company marketin% :-- brands and more than 8-- products in all areas o& the beauty business.K 52ames " O$?ouke, 8-++, p. 187 These &act sheets %i'e a clear precise %limpse o& the company since its &oundin% days. s #e ha'e detailed, L$Oreal %i'en the chan%e in market structure and %lobaliBation impact has adopted in the best #ay, to ride the tide o& competition and to stand ahead in the race &or the number spot in the cosmetic and beauty industry. *hen #e obser'e #ith the present time, products and merchandise o& L$Oreal brand can be &ound in e'ery corner o& the %lobe, and in almost e'ery retail outlets. Its brand is so &amous that e'en most o& the saloons across the #orld pre&er L$Oreal
17
hair colorant than any other products. This is interestin% indeed to obser'e, %i'en that the company started &rom the humble back%round. Thus, it #ould be interestin% to analyBe the o'erall &eature o& L$Oreal marketin% strate%y and its internal presence. o#e'er, be&ore #e make an attempt in the respect, it is prudent also to understand the meanin% o& #hat de&ines $%lobal marketin% strate%y$ in conte(t o& international business and its mana%ement components. The &ollo#in% para%raph details the discussion related to %lobal marketin% strate%y and its meanin%.
/0at i" t0e Meanin# o( Glo)al Mar.etin# Strate#!1 To be%in #ith, #e should note the established &acts that %lobaliBation and its impact ha'e had a tremendous appeal in the #orld economy. *ith the impact o& %lobaliBation, more and more corporation are %oin% international, %i'en that the market is hu%e, so is the risk as #ell as business return. The economic liberaliBation as #e understand is one subject o& %lobaliBation. There is no doubt in that re%ard. It also an established &acts that today mana%ement and its processes o'erall is more concerned #ith the intricacies o& the internal market and its components. ence, #hen 'ie#ed &rom this respect it is understood that %lobal marketin% strate%y encompasses the mana%ement process and its practicality has a lot to do #ith strate%iBin% and policy &ormulation that &ocus their attention in the international market, throu%h many 'ariety and &orms, such as mer%er, acquisitions. o#e'er, it #ould be #ise thou%h to ha'e a %limpse and understand %lobal marketin% strate%y &rom a scholastic point o& 'ie#. In that sense, 2ean!Pierre 2eannet, .6a'id ennessey 58--:7 de&ined K%lobal marketin% strate%y and mana%ement as the process in'ol'in% a coherent, uni&ied and inte%rated marketin% strate%y &or a product or ser'ices a%ainst the entire %lobal market opportunity.K 52ean!Pierre 2eannet, 8--:, p. 7 This de&inition %i'es a clear de&inite point as to #hat composed the meanin% o& %lobal marketin% strate%y. The meanin% o& such a marketin% strate%y is like #ith any other marketin% strate%y. The only di&&erence is that %lobal marketin% strate%y is more &ocused and uni&ied in a sense, and its purpose also is aim to meet the entire %lobal market opportunity.
18
Mar.et Strate#! and it" Setup
0lobal marketin% strate%y is more in!depth and broadened in one sense o& the term. It is simply a principle o& marketin% ho#e'er on a %lobal scale. "etup o& %lobal marketin% strate%y has a lot to do #ith understandin% the nature o& %lobal market itsel&, and most importantly the en'ironment. 9usiness en'ironment across the %lobe has di&&erent economic, social and p olitical in&luence. Thus, it is belie'ed that selectin% a %lobal market tar%et &or e(amples #hen strate%iBin% is a %ood idea. In that sense o& the term, #e can di&&erentiate %lobal tar%et marketin% in three &eatures, Knamely standardiBed %lobal marketin%, concentrated %lobal marketin%, and di&&erentiated %lobal marketin%.K 5Gee%an, 8--8, p. 88H7 6iscussion In this section o& the report, 0lobal marketin% strate%y o& L$Oreal is concentrated on a cross cultural arena spannin% &our market destination. They are namely, sian >arket uropean >arket Aorth merica >arket The &rican, Orient and Paci&ic ?e%ion In each o& these &our markets, each particular national market is identi&ied. s the case is #ith sian market, the concentration o& the study and its analysis has %i'en emphasis on Chinese, Thailand and 2apanese. *hen it matter to L$Oreal marketin% in urope, France, )G and 0ermany they are the hotspot discussion re%ional market and its ran%e. s &ar as it %oes #ith Aorth merica re%ion, the main market destination to be discussed is )" and Canada. Finally, the &ourth marketin% re%ions o& L$Oreal are &rica, Orient and Paci&ic ?e%ion #hich includes discussion and analysis o& L$Oreal in India, ustralia and ). Thus, it #ould be interestin% to trace the se%mentation in each re%ional market base o& L$Oreal as discussed belo#.
19
Mar.et Strate#! and it" Setup2 Glo)al Mar.etin# Strate#! o( L3Oreal in A"ia t present L$Oreal is one o& the best company in the #hole #orld in the &ield o& cosmetic products. The cosmetic products o& the L$Oreal are #idely used and specially the hair colour #hich #as introduced by L$Oreal &e# years a%o. L$Oreal is 'ery &amous in sia and their products in sia are 'ery cheaper than the other companies and are used by majority o& people in china, Thailand, 2apan etc. L$Oreal is &amous and 'ery success&ul because o& their %lobal marketin% strate%ies #hich are 'ery help&ul and also distinct &rom the strate%ies used by other companies in this &ield. L$Oreal in sia uses the sustainable strate%y that is o& %ro#in% the company as the demands o& cosmetic products in the countries like china, Thailand etc is in %reat amount. This company uses the strate%y o& suspicious brand mana%ement and they also brou%ht the strate%y o& more suspicious acquisitions. The main problem that a company like L$Oreal &aces in sia is o& competition %i'en by the other companies dealin% #ith the cosmetic products. To o'ercome this problem in sia these companies use the strate%y o& sellin% %ood quality products at the cheaper rates than the other companies. One o& the best strate%ies o& L$Oreal in sia is o& di'ersi&ication o& the brand and the main reason behind this strate%y by L$Oreal is to make them palatable in the local cultures. L$Oreal in sia aims at the mana%ement o& the %lobal brands #ith the local 'ariations and this means that their main aim is o& becomin% a local and not the &orei%n company in sia. For e(ample L$Oreal in Thailand has %i'en local names to their stores and most o& the employees present in this company, are local people o& Thailand. It is because o& all these strate%ies; L$Oreal is 'ery success&ul in #hole sia. 5L$OrealD (pansion into China, 8--<7
Mar.et Strate#! and it" Setup2 Glo)al Mar.etin# Strate#! o( L3Oreal in European Mar.et L$Oreal is the only company #hich uses the strate%ies #hich also supports the people in many #ays and not only in pro'idin% %ood quality products at cheaper rates. L$Oreal used di&&erent strate%ies o& marketin% in the uropean market like they used the strate%y o& nurturin% sel&! esteem o& the people #ith beauty. In France, L$Oreal created the pro%rams like K9eauty &rom the
20
heartK &or helpin% the people made helpless by illness or any kind o& ne%ati'e li&e e(periences. In the countries like )G and 0ermany, many o& the #omen and also the youn% people re%ain their con&idence and their sel&!ima%e %radually by usin% the cosmetics #hich are pro'ided by L$Oreal. In uropean countries L$Oreal also used the marketin% strate%ies like takin% calculated amount o& risk etc but most o& the strate%ies are related to the %ro#th o& the people mentally and not only &or the beauty or the &ashion purpose. @arious inno'ati'e treatment pro%rams are launched by L$Oreal &or the youn% people o& uropean countries and this company also launches the &ree skincare and make!up #orkshops &or the #omen su&&erin% &rom cancer. For e(ample in France a pro%ramme named as KLa @ie, de Plus 9elleK o&&ers the &ree skincare and makeup &or the cancer su&&erin% #omen in all o'er the France. This helps them to cope #ith the treatment$s side e&&ects and it also helps them to retain their sel&!esteem #hich is 'ery important &or a patient. In the uropean countries L$Oreal %enerally uses the strate%y o& the mana%ement o& brand by #hich L$Oreal had made a lar%e amount o& brands #hich are rooted in the local culture and #hich all appeals to the 'arious se%ments o& the %lobal market. 9y usin% these social types o& strate%ies &or the people o& urope has helped L$Oreal in e(pandin% their business in the #hole urope.
Mar.et Strate#! and it" Setup2 Glo)al Mar.etin# Strate#! o( L3Oreal in Nort0 A&erican Mar.et$ Aorth merican markets are considered as a per&ect place &or the companies like L$Oreal, Olay, ponds etc. The best business o& L$Oreal comes &rom the market o& )". The reason &or this much success is that L$Oreal uses 'ery %ood %lobal marketin% strate%ies in Aorth merica and the other countries like Canada etc. One o& the success&ul strate%ies o& L$Oreal in )" market is brand e(tensions #hich includes the e(tensions o& the brands a&ter doin% a complete research. For e(ample #hen L$Oreal launched a shampoo &or kids they &irstly made a complete research and also debated about the ne# launch or &or an e(tension. In )" and Canada L$Oreal uses the strate%y o& &requent ad'ertisements and promotions. s #e kno# in the present scenario proper ad'ertisements and promotions are 'ery important &or any company because people &ollo# the promotions and due to #hich the demands o& the products like hair colour increases at a 'ery rapid rate. *e can clearly understand the ad'ertisement and the promotions o& L$Oreal throu%h their media bud%et. L$Oreal has the t#el&th lar%est media bud%et in the #orld #hich is much 21
more than the other companies o& this &ield. For e(ample in the late +-$s the e(penditure o& L$Oreal ad'ertisin% and promotion #as jumped &rom the 1HN to around =HN o& the total amount o& sales. The %lobal ad spendin% o& L$Oreal #as increased to +.8: billion #hich #as on par #ith the company named as coca cola. The best thin% about this company is that they ha'e a separate and 'ery distinct policy o& promotion in the market o& )". >atri( is the number one brand o& L$Oreal in )" and the main reason behind the success o& matri( is the &requent and distinct ad'ertisement and promotion o& the cosmetic and the hair products. The people o& countries like Canada like to use ne# products that mean they like chan%es in their product a&ter some inter'al o& time. "o by keepin% this thin% in mind L$Oreal uses the strate%ies o& modi&ications #hich mean they modi&y their e(istin% products accordin% to the latest tastes and &ashion o& the local people. ccordin% to latest sur'eys o& the people o& L$Oreal company, majority o& the pro&its o& this company is because o& )" and these per&ect strate%ies used by this company in )" is the reason behind this type o& success specially in north merican market. 5elpin% 'ulnerable people7
Mar.et Strate#! and it" Setup2 Glo)al Mar.etin# Strate#! o( L3Oreal in A(rica' Orient and *aci(ic Re#ion Like other countries in the #orld L$Oreal is also 'ery success&ul and equally &amous in &rica and paci&ic re%ion. L$Oreal entered into the market o& India in the year +H and at that there #as not much a#areness about the sni&& o& structure in the industry o& hairdressin%. In the countries like ) and ustralia, proper and the or%aniBed education #as totally absent and per&ect and #ell trained hairdressers #ere also not present at that time. 6espite o& all these problems L$Oreal in India made some o& the strate%ies and one o& the best strate%ies o& L$Oreal is that they launched 'arious technical trainin% centers and they e'en opened a club o& only the hairdressers. IA ), L$Oreal products #hich #ere pro&essional be%an sellin% throu%h parisienne salons #hile the other companies ha'e be%un retailin% their ran%e o& hair color to po#er %ro#th. L$Oreal uses a %lobal marketin% strate%y o& launchin% its success&ul brands all around the #orld. For e(ample in February o& this year only, L$Oreal made an announcement o& the arri'al o& the matri( #hich is the number one brand o& L$Oreal in )" to India, ) etc #ith a reason o& addin% ran%e o& hair products to their e(istin% products at a&&ordable prices. The main thin%
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about this company is that they make strate%ies accordin% to the local culture o& di&&erent countries and not uses the same strate%ies in e'ery country. 9ecause o& all these strate%ies, L$Oreal %ains a hu%e pro&it &rom urope e'ery year. 5L$Oreal$s 0lobal 9randin% "trate%y7
Under"tandin# o( di((erent cultural di"tinction" (or international &ar.et For L,Oreal kno#led%e o& 'ariant Culture is o& %reat importance so as to make a company acquire a &irm base in the market o& any country. In order to succeed it is 'ery essential &or a company to understand the di&&erent cultural distinctions bet#een the di&&erent cultures. *hen an >AC e(plores any market &or sellin% its speci&ic ser'ices or product it has to &ocus majorly on the purchasin% po#er o& the customers, their tastes and pre&erences, than only they can succeed. ll marketin% related acti'ities and promotional strate%ies are desi%ned takin% into consideration the Cultural 9ack%round o& the particular re%ion #here the company is plannin% to launch its products and the "er'ices. I& any company &ails to take into consideration any cultural aspect and the other related &actors that it mi%ht a&&ect the company to stay &or a lon%er time and #ould be thro#n out o& the market and the re%ion. 'en the %eo%raphical &actors plays a 'ery important role that Loreal should take into consideration in order to ha'e &easible trade , as the landscape and conditions o& transport mi%ht di&&er in e'ery re%ion, #hich leads to decide #hether to use air , road or any other mode. The same re#ard schemes, moti'ational methods, desired #orkin% en'ironments, etc also cannot be the same &or di&&erent employees #orkin% &or the company in the di&&erent nations and thus it also needs the understandin% o& di&&erent aspects o& the impacts o& the cultural di&&erences. Proper analysis o& the >acro and the >icro n'ironmental &actors should be done in order to study ho# much technolo%ical and economical and politically that country is sound in order to carry out trade #ith them.
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*hether it’s an sian >arket, uropean market, Aorth merican >arket or the Paci&ic ?e%ion , e'ery#here the culture di&&ers in terms o& 'aried &actors. "o it becomes the responsibility o& the Company to do a proper scannin% o& these &actors in order to ha'e their lon%er stay in the re%ion so that they can attain a Top most Competiti'e position by adaptin% to 'arious re%ions cultural &actors in their 0lobal marketin% "trate%ies. There&ore the major thin%s that should be kept in mind &or L$Oreal #hile doin% %lobalised business is to &orm an e&&ecti'e %lobal strate%ic team &or de&inin% the tradin% policies to #ork in any country. The strate%y o& %lobaliBation should encompass o& major &actors like cultural di&&erences, economic policies o& the country etc. moreo'er the 'aryin% li&estyles o& the peoples and the rapidly chan%in% economies e'en should also be kept in mind.
RAN+ING STRATEGY O, L’OREAL 9randin% "trate%y o& L’Oreal has enabled the company to spread its’ business not only in urope but also in sia and Latin merica. In the year 8--:, the 9rand L’Oreal #as ranked &irst amon% all the cosmetics companies o& the #orld. L’Oreal 9randin% "trate%y has achie'ed success throu%hout the #orld. O'er the years, the company is success&ully producin% and sellin% di&&erent cosmetic products, hair care and skincare products in almost +:- countries o& the #orld. This has been possible because o& the #ell established 9rand Aame and 9rand Ima%e o& L’Oreal. L’Oreal has been success&ul in %eneratin% a #orld#ide 9rand Identity only because o& the company’s po#er&ul and e&&icient 9randin% "trate%y. This success&ul 0lobal 9randin% "trate%y o& L’Oreal helped the company to earn si%ni&icant le'els o& re'enue in the past years. In the year 8--:, L’Oreal #as 'alued as a +<.< billion company. In 8--=, total 'alue o& the L’Oreal 9rand #as :-8 million. In 8--1, the company recorded a 'alue o& :-- million. In &act, &rom the year +<, the 9rand L’Oreal e(perienced continuous %ro#th. The company 24
recorded double di%it %ro#th rate in consecuti'e years and in the year 8--:, it became the lar%est cosmetic company o& the #orld. The specialty o& L’Oreal 9randin% "trate%y is that it h as succeeded almost in e'ery country, #here'er L’Oreal has entered. The 9randin% "trate%y o& L’Oreal #as po#er&ul enou%h to spread itsel& to the markets o& di&&erent countries rather than restrictin% itsel& to a sin%le country. In the +-s, L’Oreal used to %enerate the lar%est 'olume o& sales &rom urope, #here the major portion used to come &rom France. 9ut, a decade a&ter, the situation started to chan%e. The 9randin% "trate%y o& L’Oreal started to concentrate in the markets outside France. The initiati'e pro'ed to be success&ul and in the year 8--=, the company %enerated <:N o& its’ consolidated sales &rom the markets outside France. The L’Oreal 9rand e(perienced success both in sia and Latin merica, e'en #hen the %lobal economy #as in a shaky position. In short, it can be said that, reason behind the success o& 9rand L’Oreal lies in the &act that the company succeeded in reachin% out to the customers o& di&&erent countries o& the #orld, across di&&erent income ran%es and cultural patterns.
L3Or4al *arent Co&pan!
L3Or4al
Cate#or!
Cosmetics and beauty products
Sector
F>C0
Ta#line5 Slo#an
9ecause you’re #orth it
US*
>o'ie stars and celebrities as brand ambassadors ST*
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Se#&ent
*omen lookin% &or beauty products
Tar#et Group
)pper class urban #omen 9eauty products &or #omen as e'ery #omen is #orth it
*o"itionin# *roduct *ort(olio
6$ Garnier ,ructi" S0a&poo
7$Garnier
od!cocoon 8$ Garnier Mineral +eodrant
9$ Garnier Color
Natural" :$ Garnier Hair Gel"
;$ Ma!)elline
Co"&etic" <$ L3Or4al *ari" rand" S/OT Anal!"i" Stren#t0
+. It is the #orld’s lar%est beauty and cosmetics company 8. as o'er -,--- people employed %lobally 1. i%h product quality, e(cellent ad'ertisin% and brand 'isibility =. Top international celebrities as brand ambassadors %i'e a 26
premium brand ima%e :. (cellent %lobal distribution ensures ma(imum reach o& products . Loreal has o'er 8- %lobal brands a'ailable in +1countries H. There are o'er 1< &actories #ith o'er : billion units manu&acturin% annually +. 6ue to many subdi'isions, employee mana%ement becomes a challen%e 8.Presence o& other established brands in the cosmetics /ea.ne""
se%ment means di&&icult to increase market share +. Tap rural markets and increase penetration in urban areas 8.>er%ers and acquisitions to stren%then the brand 1.Increasin% purchasin% po#er o& people thereby increasin%
Opportunit!
demand +. Intense and increasin% competition amon%st other F>C0 companies 8.F6I in retail thereby allo#in% international brands
T0reat"
1. Competition &rom unbranded and local products Co&petition in International Mar.et
Co&petitor"
+.>aybelline 8.A
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1.LF =.Co'er%irl
CONCLUSION The L$Or3al Paris 9rand 6i'ision o& L’Or3al )", Inc. is a total beauty care company that combines the latest in technolo%y #ith the hi%hest in quality &or the ultimate in lu(ury beauty at mass. L$Or3al Paris is a truly %lobal beauty brand #ith many internationally reno#ned products. For most, the name RL$Or3alS is immediately e'ocati'e o& the brand’s si%nature phrase, K9ecause I$m *orth It.S the concept behind the le%endary ad'ertisin% campai%n &or the "uperior Pre&erenceU hair color launch in +H1. Today, it represents the essence o& the L$Or3al Paris brand as a #hole, a spirit #hich is about helpin% e'ery #oman embrace her unique beauty #hile rein&orcin% her innate sense o& sel&!#orth. s the bi%%est beauty brand in the #orld, L$Or3al Paris has an unparalleled commitment to technolo%y, research and inno'ation, pro'idin% %roundbreakin%, hi%h!quality products &or #omen, men, and children o& all a%es and ethnicities. L$Or3al Paris is notably dedicated to celebratin% the di'ersity o& beauty V the company’s broad ran%e o& spokespeople include "onam Gapoor, ish#ariya rai, ndie >ac6o#ell, 6iane Geaton, 2enni&er LopeB, 2ulianna >ar%ulies, 'a Lon%oria, Laetitia Casta, Freida Pinto, 6outBen Groes, imee >ullins, 2ulianne >oore, and Garlie Gloss.
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ILIOGRA*HY httpDEE###.lorealparisusa.comEenEbout!Loreal!ParisEO'er'ie#.asp( httpsDEEen.#ikipedia.or%E#ikiELN8HOrNC1Nal httpDEE###.loreal.comEbrand httpDEE###.loreal.comE%roupE#ho!#e!areEour!mission
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