...largest beauty company, L'Oréal, has expanded globally both by acquisition of the existing companies and by developing its own brands. It discusses the role of acquisition in L'Oréal's growth, as well as L'Oréal's global strategies by how the company offers its worldwide consumers the American and French beauty. It also discusses the recent acquisition of Kiehl's; its role and contribution to L'Oréal as well as the opportunity given to the brand by joining L'Oréal. When people walk into a cosmetics isle in stores, it is hard to miss L'Oréal products; they are everywhere from a small, locally owned beauty salon to the retail giant, Wal-Mart. It is not just in the United States. The same happens when people walk into stores in Europe and Asia. L'Oréal products are almost anywhere and everywhere. L'Oréal, the beauty company that its Senior Vice President of Human Resources, Bob Niles, calls "the only beauty company," (Jones, Kiron, Dessain, & Sjoman, 2006, p. 13) covers not only the different types of beauty products---cosmetics, skin care, hair care, and fragrances in luxury products, low-priced products, and professional products---but also every target market from younger generations to older generations from different countries in the world. The world's largest beauty company would not have reached its number-one position without the tactful global strategies. L'Oréal was founded in 1907 in France by a chemist named Eugene Schueller. The company was named after the world's first...
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...time as buyers wait for new shipments. Condensed Recommendation: L’Oreal should carefully select a CEO candidate who has experience in global management and the ability to spot trends. L’Oreal should proceed with the potential takeover of Japanese Shu Uemura, but they should reconsider the Nivea takeover as it may open them to a potential takeover threat. They should continue with their global expansion by developing new brands to meet particular ethnicities, perhaps aiming to catch the South American market as they have done with the African market. They should also flesh out their dermocosmetics products lines to increase the low 6% revenue in that area. Problem L’Oreal has experienced unprecedented success through global expansion into new beauty-product markets, under the direction of Owen Jones, who became a chairman in 1988. In 2006, Owen Jones plans to retire, so there is some speculation on how things may change with his successor. Currently there are a number of business maneuvers L’Oreal is considering: the friendly takeover of Japanese brand Shu Uemura, the bid for German Nivea, and the sale of their 19.5% interest in Sanofi-Synthelabo. There is also a potential takeover threat from Nestle, as they have a 26% interest in the L’Oreal; and the potential takeover threat from Beiersdorf/Tchibo Group, who have a 30% interest in Nivea, so if L’Oreal buys into Nivea they could expose themselves to a...
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...Q2. Globalization of L’Oreal After spreading as a sought after brand in Europe, L’Oreal decided to become global and its first stop was the United States. L’Oreal was indeed good at studying its new market. Soon enough it was competing well with the top local brands in America and the reason for its success was the acquisitions that it underwent in order to grow internationally. The acquisitions of companies such as Maybelline Kiehl’s and Redken acted as the thway for the growth and success of L’Oreal. The acquisition strategy implemented by L'Oreal guide them to be the world leader company in the beauty industry; all these US acquisition they made created a sub division within their products catalogue, consumer, professional, and luxury, L'Oreal's success is a clear example of how to implement a corporate strategy and manage a brand internationally to achieve a massive growth even when the market they sell their products in isn't very steady, the key was to understand and successfully satisfy the needs of every customer through its products like they did with the Wet Lipstick in Japan, or the Research and Development process they carry out to satisfy the Afro-American customer needs. L'Oreal has the capacity to reach more people across the world than any other beauty company thanks to their distribution channels and also is able to generate a bigger income rather than other companies due to their big products catalogue. The prospect of increasing profitability and market...
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...Marketing Ann-Christin, Daniela, Marina Michaela Ann-Christin Daniela Marina, Michaela 1 1 Learning objectives • Historical background of L’ORÉAL • L‘ORÉAL brands • Positioning of brands • Globalization of brands & the business L’ORÉAL • Strategies of L´ORÉAL • Distribution • Finding Recommendations Dezember 2005 Internationales Marketing Ann-Christin, Daniela, Marina, Michaela 2 1 L’ORÉAL brands Consumer Brands: • L'ORÉAL Paris • Garnier • SoftSheen-Carson • Maybelline New York • Le Club de Createurs Professional Products: • Kérastase • L'ORÉAL Professional • Matrix • Redken Source: www.loreal.de Dezember 2005 Internationales Marketing Ann-Christin, Daniela, Marina, Michaela 3 L’ORÉAL brands Luxury Products: • Biotherm • Helena Rubinstein • Kiehl's Since 1851 • Lancôme • Shu Uemura • Designer Fragrances Active Cosmetics: • La Roche-Posay • Vichy • Innéov Source: www.loreal.de Dezember 2005 Internationales Marketing Ann-Christin, Daniela, Marina, Michaela 4 2 Positioning of L‘ORÉAL brands High Quality Luxury Active & Professional Consumer Low Price High Price Low Quality Dezember 2005 Internationales Marketing Ann-Christin, Daniela, Marina, Michaela 5 Ansoff Matrix Market Product Present New Present Market Penetration Market Development New Product Development Diversification Dezember 2005 Internationales Marketing Ann-Christin, Daniela, Marina, Michaela Source: Kotler 6 3 7 W A Y S New Competitive...
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...Europe which soon recognized them as the leader in body care and hair coloring products. Finally soon after World War II L’Oreal moved into the United States and the company seemed to change. When L’Oreal expanded the competition was more involved and more growth was needed in order for the company to be more successful. With problems like this, the strategy and planning that has been applied in L’Oreal has been huge for the success of the company. L’Oreal realized they needed to expand in other fields of the beauty market and target markets in order to stay alive and successful. This would mean that L’Oreal would need to acquire other companies as part of their expansion and through this they have kept the constancy of the leading company with acquisitions of many small companies. Finally in the 1980s they started their globalization into new markets all around the globe by acquiring new companies that would form the cosmetics that we know today. Although the role of acquisitions has never been the main focus of the company, internal growth and strategy was the number one reason for L’Oreal becoming such a big name. The main strategy was to adopt...
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... reader discretion is advised. Beauty and Personal Care Baby and ChildSpecific Products Bath and Shower Colour Cosmetics Deodorants Depilatories Fragrances Hair Care Men's Grooming Oral Care Skin Care L'Oréal has performed well thanks to a segmented portfolio lending it the flexibility to address diverse consumer groups across the world. However, competitive intensity is increasing, which L'Oréal needs to heed to retain its market position in the long run. Sun Care Set/Kits Premium Cosmetics Mass Cosmetics © Euromonitor International BEAUTY AND PERSONAL CARE: L'ORÉAL GROUPE PASSPORT 2 STRATEGIC EVALUATION COMPETITIVE POSITIONING MARKET ASSESSMENT GEOGRAPHIC AND CATEGORY OPPORTUNITIES BRAND STRATEGY OPERATIONS RECOMMENDATIONS STRATEGIC EVALUATION Key company facts L'Oréal Groupe Headquarters: Regional involvement: France Global Skin care, colour cosmetics, Category involvement: hair care, fragrances, men’s grooming, sun care World BPC share 2011: 9.7% World BPC value 4.8% growth 2011:...
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...discretion is advised. Beauty and Personal Care Baby and ChildSpecific Products Bath and Shower Colour Cosmetics Deodorants Depilatories Fragrances Hair Care Men's Grooming Oral Care Skin Care L'Oréal has performed well thanks to a segmented portfolio lending it the flexibility to address diverse consumer groups across the world. However, competitive intensity is increasing, which L'Oréal needs to heed to retain its market position in the long run. Sun Care Set/Kits Premium Cosmetics Mass Cosmetics © Euromonitor International BEAUTY AND PERSONAL CARE: L'ORÉAL GROUPE PASSPORT 2 STRATEGIC EVALUATION COMPETITIVE POSITIONING MARKET ASSESSMENT GEOGRAPHIC AND CATEGORY OPPORTUNITIES BRAND STRATEGY OPERATIONS RECOMMENDATIONS STRATEGIC EVALUATION Key company facts L'Oréal Groupe Headquarters: Regional involvement: France Global Skin care, colour cosmetics, Category involvement: hair care, fragrances, men’s grooming, sun care World BPC share 2011: 9.7% World BPC value 4.8% growth 2011: ...
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...market for luxury brands has experienced a dramatic growth over the last three decades, and the current demand for luxury brand products has grown enormously. Wiedmann, Hennigs and Siebels(2009, p. 627) stated that a luxury good: “brings esteem for its owner and enables consumers to satisfy psychological and functional needs”. This essay will argue that marketing theories: brand theories and the ‘four-P framework’ ( product, pricing, place and promotion) are applied to bring superior value to luxury brands. It will also identify the tangible and intangible resources that are utilized to add superior value to luxury brands, in comparison to low-priced products. An illustration will also be given regarding luxury and basic cosmetic branding. Finally, it will be argued that it is not ethical to charge high prices for products. Nowadays the consumption of luxury products has become so vital to the global economy and the high profile of luxury goods has built widespread awareness of brands in customers’ perception. It is claimed that a luxury brand is one that is selective and exclusive, and which has an additional creative and emotional value for the customer (Chevalier and Mazzalovo, 2008). Even if some consumers cannot afford to buy luxury brands, they are familiar with the name or symbol of some famous brands that are classified as luxuries. A brand name helps differentiate its products from others and makes it distinct from those of other sellers. Brand equity concerns the...
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...2010, 74–89 From an aggregate to a brand network: a study of the ´ brand portfolio at L’Oreal Claude Chailan, International University of Monaco, Monaco Abstract Our purpose is to contribute to the understanding of brand-portfolio management by examining the brand-portfolio strategies of a world-leading company. We started to work on a case study with L’Oreal. Our research ´ focused on two questions: (1) what reasons lead L’Oreal to develop a brand´ portfolio strategy?; (2) how can brand-portfolio management create a higher and stronger level of competitive advantage for this company? The results show that an aggregation of brands is not in itself a brand portfolio. The juxtaposition of brands is one of, but not the sole, element necessary for the development of a brand portfolio, which is a combination of a brand ensemble and key competences born out of organisational savoir-faire. By analysing the evolution of the L’Oreal brand portfolio, this work shows how the brand ´ combination within a portfolio is a key factor for company development, growth, and risk management. It is a crucial phase to understand L’Oreal’s competitive ´ advantage. Keywords brand portfolio; brands; strategic marketing; L’Oreal ´ Introduction Many firms are becoming increasingly concerned with the definition of the relationships between brands within the company as parts of a whole, and with the organisation of these connections within the framework of a brand network. This is due to the fact that...
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...Clichy, France, is the world's largest cosmetics and beauty company. L’Oréal has developed activities in the field of cosmetics, concentrating on hair color, skin care, sun protection, make-up, perfumes and hair care. L’Oréal is active in the dermatological and pharmaceutical fields. L’Oréal is also the top Nan technology patent-holder in the United States. It’s run by CEO Susan Davisson. In 1909, Schueller registered his company. In 1920, the small company already employed 3 chemists. By 1950, the research teams were 100 strong; that number reached 1,000 by 1984 and is nearly 2,000 today. L’Oréal got its start in the hair-color business, but the company soon branched out into other cleansing/beauty products. L’Oréal now markets over 500 brands and many thousands of individual products in all sectors of the beauty business: hair color, permanents, styling aids, body and skin care, cleansers and fragrances. L’Oréal Type: Société Anonyme Founded: 1909 Headquarters: Clichy, France Key people: Eugène Schueller, François Dalle, Graham Hedworth, Lindsay Owen-Jones, Jean Paul Agon Industry: Cosmetics Revenue: €14.53 billion (2005) Operating income: €2.266 billion (2005) Net income: €1.639 billion (2005) Employees: 52,080 Slogan: Because you're worth it External analysis Rising packaging costs The cosmetics and personal care products manufacturers have been incurring high packaging...
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...Program in General Management Class of Executive July 2008 Course Leader: Handry Satriago Oct 2009 – Feb 2010 IPMI Business School Graduate Program The Indonesian Institute for Management Development Jakarta, Indonesia Course Name : Managing International Business (MIB) Class : Executive Program, July 2008 Facilitators : Handry Satriago (Course Leader) Guest Speakers : Subject to confirmation from the guest speakers - Riri Riza/Mira Lesmana, MILES Film (Session 5) Topic: Indonesia Movie Industry - Richard Matalon, President Director L’Oreal Indonesia (Session 12) Topic: L’Oreal strategy entering Indonesia - Vikram Reddy, GM Four Seasons Hotel Jakarta (Session 16) Topic: Four Seasons Global Strategy Background Companies today confront an increasing array of choices of markets, of locations for value adding activities, and of modes of crossing borders. This course focuses on the international dimensions of strategy and organization, and provides a framework for formulating strategies in an increasingly complex world economy, and for making those strategies work effectively. Operation in an international environment gives the manager access to new markets, additional natural resources, and low-cost-factor endowments. More importantly, it opens up new sources of ideas and knowledge...
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...conclusion 9. limitations 10. RECOMMENDATION 11. BIBLIOGRAPHY 12. ANNEXURE INTRODUCTION INTRODUCTION: L’Oreal is the global leader in cosmetics, with 25 brands. They have 5 key areas of expertise − hair care, hair colorants, skincare, make-up and fragrances. There is a huge motive behind the study of L’Oreal. The study will help us to understand the operations which are carried out by L’Oreal. The operations such as marketing strategies, business plans, company at a glance, business structure, management and operating structures , competitors position as per this company, business development, discussion of business strategies, SWOT analysis to understand the different pros and cons of the company, so as to report properly to operate effectively and deal smartly. This study offers a comprehensive analysis of the organization, its business segments, and competitors. It analyzes the business and marketing strategies...
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...L’Oreal: Global Brand, Local Knowledge MRKT 454 May 2012 Introduction This case study is about L’Oreal and how it has come today to be known as one of the largest advertisers and investors in research and development. The company has tapped numerous markets and established itself strongly through its various brands. There is a constant need to innovate and the products are new and better and attracting more and more customers at all levels of segmentation. The company is known for its acquisitions and that is how it has done much of its growth in the emerging economies as well as the US. The Company is known internationally for its portfolio of beauty and personal care products that are aimed towards catering to each level of market segment. It is an international success with deep rooted commitment and sensitivity towards local consumers’ needs and cultures. 1. Management Orientation: L’Oreal’s management orientation is geocentric. This can be seen in the sales, half of which come from outside of Europe. L’Oreal has 23 global brands across 130 countries and has 38 factories all over the world (Henderson, R., & Johnson, R. 2010). The firm has promoted its national brands to the rest of the world as related by Owen-Jones. Owen-Jones promoted the five core businesses into becoming global. These included: hair care, hair color, skin care, color cosmetics and fragrances. If we look at the website of L’Oreal Paris, we can see its presence in five continents and...
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...comprehensive evaluation, the paper will determine opportunities and draw appropriate recommendations via Value-Driven Marketing approach for future development of the organisation in order to sustain competitive advantage within the industry. 1.2 Industry Context According to Euromonitor latest research, the beauty industry worldwide value was estimated at $426 billion in 2011 (Euromonitor, 2012). Porter (1980) states that within broad industries, subgroups exist in the form of strategic groups, which face their own unique set of competitive rules. In the case of Aveda, the company operates in natural and organic market which is $14 billion worth niche group of the broader personal care product industry. II. AVEDA - THE CORPORATE STRATEGY PERSPECTIVE 2.1 Aveda Corporation - the company background. Aveda Corporation (Aveda) is Minneapolis based manufacturer, established in 1978 by Horst Rechelbacher and it has been operating in the personal product care industry. Aveda offers a line of over 700 premium professional and consumer, plant-derived personal care products. Currently, the company posses 7000 salons, day spas and retail outlets located globally. In 1997, Aveda was acquired for US$300 million by the cosmetic giant Estee Lauder, although it operates as an independent entity. As part of Estee Lauder family of brands, Aveda has contributed substantially to corporate growth, particularly in hair care products. (Louche et...
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...Catalog 1. Introduction 1 2.Identify the purposes of different types of organisation. 2 2.1 Differentiate the types of organizations 2 2.2 Describe the purposes of the organizations separately 3 2.3 Analyze the purpose of The Body Shop 3 2.4 Summary 4 3.Describe the extent to which an organisation meets the objectives of different stakeholders 4 3.1 Analyze the stakeholders' needs in The Body Shop 4 3.2 Describe how managers meet the interests of various stakeholders 5 3.3 Summary 5 4.Explain the responsibilities of an organisation and strategies employed to meet them. 5 4.1 Explain the responsibilities of an organization in theory 5 4.2 Analyze the responsibilities and strategies which are committed by The Body Shop. 6 4.3 Summary 7 5.Explain how market structures determine the pricing and output decisions of businesses 7 5.1 Identify the four types of market structures 8 5.2 Analyze which market structure The Body Shop belongs to 9 5.3 Summary 10 6.Illustrate the way in which market forces shape organizational responses using examples 10 6.1 Identify the five forces and explain how they impact on competition 11 6.2 Illustrate the relationship between market forces and The Body Shop's responses 12 6.3 Summary 12 7.Judge how the business and cultural environments affects organisation 12 7.1Give an understanding of how "business" and "cultural" affects The Body Shop 13 7.2Show why "business" and "cultural" environments...
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