Lorean Case Study dnd

MARKET SURVEY REPORT
ON
CUSTOMER SATISFACTION ON

INPARTIAL FULFILLMENT OF DEGREE OF
BACHELOR OF BUSINESS ADMINISTRATION
M.J.P.R.U, BAREILLY
(SESSION: 2010-2011)
SUBMITTED TO:

SUBMITTED BY:

Mrs. Sandhya Tripathi

Pragati Dixit

IIMS Faculty

BBA-VI sem-C
915584

CONTENTS:
1. INTRODUCTION
2. OBJECTIVES
3. RESEARCH METHODOLOGY
4. COMPANY PROFILE
5. LITERATURE REVIEW
6. DATA PRESENTATION AND ANALYSIS
7. FINDINGS
8. CONCLUSION
9. LIMITATIONS
10. RECOMMENDATION
11. BIBLIOGRAPHY
12. ANNEXURE

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
adopted by the company, to gain a competitive edge in the industry. The profile also
evaluates the strengths of the company and the opportunities present in the market. This
study presents the key facts & figures, business description, products & services offered
and corporate timeline of the company. It involves analysis of the company at three levels
– segments, organizational structure and
ownership composition. Both business and geographic segments are analyzed along with
their recent financial performance. It further discusses the major subsidiaries of the
company and the recent merger & acquisitions. It also examines the significant
developments and milestone that have taken place in the company. It is a form of news
analysis where the most critical company news is discussed. Also the factor Financial
Performance included in this study. It discusses the most recent financials of the company
and also compares the historical sales & income figures with the current and projected
figures. The objective is to evaluate the financial health of the company. The analyst
opinion and stock performance help anyone in evaluating the performance of the
company from an investor’s viewpoint.

The L’Oreal Group is the world's largest cosmetics and beauty company and is
headquartered in the Paris suburb of Clichy, Hauts-de-Seine, France. L’Oreal has
developed activities in the field of cosmetics, concentrating on hair color, skin care, sun
protection, make-up, perfumes and hair care. L’Oreal is active in the dermatological and
pharmaceutical fields. L’Oreal is also the top nanotechnology patent-holder in the United
States.
L’Oreal is a listed company, but the founder's daughter Liliane Bettencourt and the Swiss
food company Nestlé each control over a quarter of the shares and voting rights.
The company's international brands include: Anais Anais, ARTec, BioMedic, Biotherm,
Cacharel, Dermablend, Drakkar Noir, Garnier, Giorgio Armani Parfums and Cosmetics,
Kerastase, Kiehl's Since 1851, La Roche-Posay, Lanc¥me, L'Oreal Paris, L'Oreal
Professionnel, L'Oreal Technique, Matrix, Maybelline New York, Paloma Picasso, Ralph
Lauren Fragrances, Redken 5th Avenue NYC, Shu Uemura, SkinCeuticals, SoftSheenCarson, Vichy, Viktor&Rolf.
The company was originally founded in 1953 as Cosmair, Inc as the exclusive U.S.
licensee of the L'Oreal Group.
In 1972, L'Oreal unveiled the first TV ads for the "I'm Worth It" campaign for Preference
haircolor which would help boost sales.The company's acquisitions have led to
significant growth which include: Redken in 1993, Maybelline in 1996, Soft Sheen in
1998, Matrix, Kiehl's and Carson in 2000, ARTec in 2002 and SkinCeuticals in 2005.
Cosmair would become a wholly owned subsidiary of L'Oreal SA Paris in 1994
L'Oréal India
L’Oréal India Private Limited is a wholly owned subsidiary of L’Oréal S.A.
Headquartered in Paris, L’ORÉAL is the global leader in cosmetics with 5 key expertise
in hair care, hair color, skin care, make-up and fragrances. L’Oréal’s leadership is
achieved through cutting-edge technology with a portfolio of well-known brands that
answer all beauty needs and are distributed in all channels.
Each brand benefits from considerable investments in research made by the L'Oréal
Group. The Group's research efforts, unique in the beauty industry, permit each brand to
benefit from formulas specifically adapted to the needs of men and women worldwide,
within each market or distribution circuit that is present.
L'Oréal India has over 600 employees and has a strong track record with consistent
double digit sales growth yearly.

In the year 1907, Eugene Schuller , a young French chemist, developed an innovative
hair-colour formula. He called his improved hair dye AUREOLE. With that the history of
LOREAL began. Eugene Schuller formulated and manufactured his own products, which
he then sold to parsian hairdressers.
In 1909, Schuller registerd his company, the Société
Française de Teintures inoffensive pour Cheveux (“safe hair dye company of france “),
The future Loreal . The guiding principals of the company that would become Loreal
were put into place from the start: research and innovation in the intrest of beauty. During
the early twentieth century, Schuller provided financial support and held meetings to La
Cagoule at loreal headquarters. La Cagoule was a violent French fascist-leaning and anticommunist group. Loreal hired several members of group as executives after world war
II.
In 1920,the small company employed only three chemist . by 1950, the research teams
were 100 strong ; that number reached 1000 by 1984 and is nearly 2000 today. Loreal got

its start in the hair-color business , but the company soon branched out into other
cleansing and beauty products. Loreal 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. They are found in all
distribution channels, from hair-salons and perfumeries to hyper –and supermarkets,
health/beauty outlets, pharmacies and direct mail.
Loreal have five worldwide reaserch and
development centers ; two in france ; Aulnay and Chevilly ; one in U.S clark, new jersey;
one in japan; Kawasaki ,kanagawa prefecture; and in 2005 , one was established in
china ,shanghai .
LOreal purchased synthelbo in 1973 to pursue its ambitions in the
pharmaceutical field. synthelabo merged with sanofi 1999 to become sanofi-aventis.
On 17 march 2006 loreal made a £652 million agreed takeover of ethical
cosmetics company THE BODY SHOP.
The company has recently faced discrimination
lawsuits in france related to the hiring of spokesmodels. In the uk loreal has faced
widespread condemnation from OFCOM regarding truth in their advertising and
marketing campaigns concerning the product performance of their mascara brand.
Multiple video parodies of their advertising campaigns have spoofed their products and
can be viewed on You Tube- search LUNREAL for links to content.
Loreals history has just
been exposed in a best seller by MONICA WAITZFELDER published in france as
“loreal a pris ma maison” and English as “loreal stole my home”. The book details how
loreal, a notoriously anti-semitic company historically , took over the Waitzfelder home
in german city of karlsruhe (after the Nazis had engineered the removal of the family) to
make it its german headquarters. Waitzfelder has run a lifelong battle through the French
courts to try ti get compensation — the case is now to come before the European Courts
Of Human Rights .

Loreal’s famous advertising slogan is “Because I’m worth it”. It has
recently been replaced by “Because you’re worth it”. Loreal owns a hair and body
products line for kids called LOREAL KIDS. Their slogan is “Because we’re worth it
too”, which is very similar to that of its parent .Loreal still tests new ingredients on
animals ,which has led to criticism from Naturewatch Compassionate Shopping.
1400 new formulations have been registered in the last three years.
In 1987 loreal and 3 Suisses founded “le club des createurs de beaute”. Specializing in
mail order sales of cosmetic products.
Following loreals purchase of THE BODY SHOP, who previously were against animal
testing, The Body Shop founder Dame Anita Roddick was forced to defend herself
against allegations of abandoning her principles over loreal ‘s track record on animal
testing. As a result, calls were made for shoppers to boycott The Body Shop.
GARNIER is a mass market brand of loreal that produces hair
care products, including the Fructis line, as well as skin care products, notably the newer
Nutritioniste line. One of their key proprietary ingredients is a fruit concentrate used in
all their products. It is a combination of fruit acids, vitamin B3 and B6, fructose and
glucose.

OBJECTIVES:
•

The main objective behind the study of this project is to evaluate the distribution
channel for L’Oreal Paris Company.

•

How the L’Oreal Paris company emphasis more on customers service.

•

How L’Oreal value the time in their process of work.

•

How the L’Oreal have segmented the market in different directions.

•

How the company is growing by the time

As required by the objectives of the project report, I started working accordingly,
getting the details of the topic, from different sources and under the guidance of my
project guide, to get desired results and applied my energy towards the formation of this
project.

RESEARCH METHODOLOGY:

RESEARCH DESIGN
A Research Design is the framework or plan for a study which is used as a guide in
collecting and analyzing the data collected. It is the blue print that is followed in
completing the study. The basic objective of research cannot be attained without a proper
research design. It specifies the methods and procedures for acquiring the information
needed to conduct the research effectively. It is the overall operational pattern of the
project that stipulates what information needs to be collected, from which sources and by
what methods.
Research is process of a systematic enquiry into facts and in depth study of
probing into a particular topic or subject, backed by the collection, complication,
presentation and interpretation of relevant data. It is an intelligent and scientific work,
which is an Endeavour to discover valuable facts.
Research must be based on the facts. Observable data forms a
sound basis for research. Inductive investigation leads greater support to research
findings, for analyzing facts, a scientific methodology of analysis must be developed and
result interpreted logically.

Following steps are undertaken to conduct this research:1. Selection of the subject.
2. Objectives of the study.
3. Collection of data.

4. Analyzing the data.
5. Title of the project.
TYPE OF DATA COLLECTED:There are two types of data used. They are primary and secondary data. Primary data is
defined as data that is collected from original sources for a specific purpose. Secondary
data is data collected from indirect sources. These include books, the internet, company
brochures, product brochures, the company website, competitor’s websites etc,
newspaper articles etc.
The data is like heart of all types of research. This collection of data depends
upon the purpose for which the data is required .it is considered to be very important
steps as it is the basis of foundation of investigation.
a) Primary data:It is the data collected by a person for his own use obtained
from the findings. This is considered to be the first hand information. These are those
data which are collected by us to meet our own specific purpose.

The methods which are adopted for collecting primary data for the
purpose of this project report are as follows:-

i) Data through questionnaireA questionnaire has been prepared and filled by
the female customer who uses products of L’Oreal by doing market survey.

ii)

Personal interviews:A direct personal interview of several users has been taken.
Their views were taken regarding the quality of the products which satisfy them by
fulfilling there requirements.

Other methods which are adopted for collecting primary data to
complete this project report are-

 Direct personal observation , and ,
 Indirect oral investigation.

b) Secondary data:It is the data which is collected by some other person or the
organization itself for their own use, but, this type of data/information can also be used
by the researchers for his use as second hand information.
Sources through which secondary data for
this project report are collected by journals, magazines and internet.

•

After gathering all the required information I decided to go in for
this project as this project would give me the practical experience
and also provide me with an opportunity to work on a subject of
my interest.

Company Profile:
The L’Oreal Group is the world's largest cosmetics and beauty company. With its
registered office in Paris and head office in the Paris suburb of Cliché, Haunts-de-Seine,
France, it has developed activities in the field of cosmetics. Concentrating on hair color,
skin care, sun protection, make-up, perfumes and hair care, the company is active in the
dermatological and pharmaceutical fields and is the top nanotechnology patent-holder in
the United States.
L’Oreal is a listed company, but the founder's daughter Lillian Bettencourt and the Swiss
food company Nestlé each control over a quarter of the shares and voting rights.

History:
In 1907, Eugene Schuler, a young French chemist, developed a hair dye formula
called Aureole. Schuler formulated and manufactured his own products, which
he then sold to Parisian hairdressers.
In 1909, Schuler registered his company, the Society Francoise de Tinctures
Inoffensive pour Cheveux ("Safe Hair Dye Company of France" literally "French
Society of Inoffensive Hair Dyes"), the original L’Oreal. The guiding principles of the
company, which eventually became L’Oreal, were research and innovation in the field of
beauty.
In 1920, the small company employed three chemists. By 1950, the research teams were
100 strong; that number reached 1,000 by 1984 and is nearly 2,000 today.
L’Oreal got its start in the hair-color business, but the company soon branched out into
other cleansing and beauty products. L’Oreal currently markets over 500 brands and
many thousands of individual products in all sectors of the beauty business: hair color,
permanents, hair styling, body and skin care, cleansers, makeup and fragrances. The
company's products are found in a wide variety of distribution channels, from hair salons
and perfumeries to hyper - and supermarkets, health/beauty outlets, pharmacies and direct
mail.
L’Oreal has five worldwide research and development centers: two in France: Almay and
Coevally; one in the U.S.: Clark, New Jersey; one in Japan: Kawasaki, Kanagawa
Prefecture; and in 2005, one was established in Shanghai, China. A future facility in the
US will be in Berkeley Heights, New Jersey.
From 1988 to 1989, L’Oreal controlled the film company Para vision, whose properties
included the Filiations and De Laureates libraries. Studio Canal acquired the Para vision
properties in 1994.

L’Oreal purchased Synthélabo in 1973 to pursue its ambitions in the pharmaceutical
field. Synthélabo merged with Sanofi in 1999 to become Sanofi-Synthélabo. SanofiSynthélabo merged with Aventis in 2004 to become Sanofi-Aventis.
On 17 March 2006, L’Oreal purchased cosmetics company The Body Shop for £652
million.
The company has recently faced discrimination lawsuits in France related to the hiring of
spokes models and Institutional racism. In the UK, L’Oreal has faced widespread
condemnation from OFCOM regarding truth in their advertising and marketing
campaigns concerning the product performance of one of their mascara brands.
A book by Monica Waitsfield, published in French as L’Oreal a prism ma malison and in
English as L’Oreal stole my house!, details how L’Oreal, a company claimed to be antiSemitic by the author, took over the Waitsfield home in the German city of Karlsruhe
(after the Nazis had engineered the removal of the family) to make it its German
headquarters.
L’Oreal’s famous advertising slogan is "Because I'm worth it". In the mid 2000s, this was
replaced by "Because you're worth it". In late 2009, the slogan was changed again to
"Because we're worth it" following motivation analysis and work into consumer
psychology of Dr. Maxim Titorenko. The shift to "we" was made to create stronger
consumer involvement in L’Oreal philosophy and lifestyle and provide more consumer
satisfaction with L’Oreal products. L’Oreal also owns a Hair and Body products line for
kids called L’Oreal Kids, the slogan for which is "Because we're worth it too".
Protest group Nature watch states that L’Oreal continues to test new ingredients on
animals. The company states that no animal testing for finished products has taken place
since 1989 and that L'Oreal has invested significantly in alternative methods for chemical
safety testing, though they implicitly acknowledge that they continue to perform animal
testing of ingredients.
Following L’Oreal’s purchase of The Body Shop, who continue to be against animal
testing, The Body Shop founder Dame Anita Riddick was forced to defend herself against
allegations of abandoning her principles over L’Oreal’s track record on animal testing.
She declared that her belief in the power of cosmetics to enhance female beauty was
greater than any concern over animal testing. As a result, calls were made for shoppers to
boycott The Body Shop.
In 1987, L’Oreal and 3 Suisse’s founded Le Club des Creatures de Beauty specializing in
mail order sales of cosmetic products.
February 2011: L'Oreal will has the largest factory in the Jababeka Industrial Park,
Cikarang, Indonesia with total investment of US$50 million and it will be ready in
October 2011. The production will be absorbed 25 percent by domestic market and the

rest will be exported. In 2010 significant growth occurred at Indonesia with 61 percent
increase of unit sales or 28 percent of net sales.
Business

Corporate governance
Board of directors
Current members of the board of directors of L’Oreal are: Jean-Paul Argon, Francisco
Basco, Werner Bauer, Liliane Bettencourt, Françoise Bettencourt Meyers, Peter BrabeckLetmathe, Charles-Henri Filippi, Xavier Fontenot, Bernard Kasriel, Marc Latherier, JeanPierre Meyers, Lindsay Owen-Jones, Franck Rebound, Annette Roux and Louis
Schweitzer.

Management committee
The management committee includes:
•
•

Jean-Paul Argon, Chief Executive Officer
Frederic Roze, Chief Executive Officer, L’Oreal USA

•

Béatrice Dautresme, EVP of Corporate Communications

•

Jean-François Grollier, EVP of Research and Development

•

Christian Mulliez, EVP of Finances

•

Jean-Jacques Lebel, President of Consumer Products

•

Nicolas Hieronimus, President of Professional Products

•

Geoff Skingsley, EVP of Human Resources

•

Marc Menesguen, President of Luxury Products

Stockholders
As at year end 2009:
•

Breakdown of share ownership: 31.0% by the Bettencourt family, 29.8% by Nestlé, 2.4%
treasury shares, and the remaining 36.8% is public

Sales, profits, etc.
In 2003, L’Oréal announced its 19th consecutive year of double-digit growth. Its
consolidated sales was €14.029 bn and net profit was €1.653 bn. 96.7% of sales derived
from cosmetic activities and 2.5% from dermatological activities. L’Oréal has operations
in over 130 countries, employing 50,500 people, 24% of which work in France. 3.3% of

consolidated sales is invested in research and development, which accounts for 2,900 of
its employees. In 2003, it applied for 515 patents. It operates 42 manufacturing plants
throughout the world, which employ 14,000 people.
•

Cosmetics sales by division breakdown: 54.8% from consumer products at €7.506 bn,
25.1% from luxury products at €3.441 bn, 13.9% from professional products at €1.9 bn,
and 5.5% from active cosmetics at €0.749 bn.

•

Cosmetic sales by geographic zone breakdown: 52.7% from Western Europe at €7.221
bn, 27.6% from North America at €3.784 bn, 19.7% from rest of the world at €2.699 bn.

In 2007, L’Oreal was ranked 353 in the Fortune Global 500. The company had earned
$2,585 million on sales of $19,811 million. There were 60,850 employees.

Joint ventures and minority interests
L’Oreal holds 10.41% of the shares of Sanofi-Aventis, the world's number 3 and Europe's
number 1 pharmaceutical company. The Laboratoires Innéov is a joint venture in
nutritional cosmetics between L’Oréal and Nestlé; they draw on L’Oréal's knowledge in
the fields of nutrition and food safety. Galderma is another joint venture in dermatology
between L'Oréal and Nestlé.

Community involvement and awards
In 2008, L’Oreal was named Europe's top business employer by The European Student
Barometer,a survey conducted by Trendence that covers 20 European countries and
incorporates the responses of over 91,000 students.
The L’Oreal-UNESCO Awards for Women in Science was established to improve the
position of women in science by recognizing outstanding women researchers who have
contributed to scientific progress.
The awards are a result of a partnership between the French cosmetics company L’Oreal
and the United Nations Educational, Scientific and Cultural Organization (UNESCO) and
carry a grant of $100,000 USD for each laureate.
The same partnership awards the UNESCO-L’Oreal International Fellowships, providing
up to $40,000 USD in funding over two years to fifteen young women scientists engaged
in exemplary and promising research projects.
L’Oreal organizes every year the L’Oreal Brand storm, an acknowledged business game
for students in 43 countries. The game is related to marketing and has a first prize of
$10,000, a second prize of $5,000 and a third prize of $2500.

Claims of racial discrimination in advertising, and other litigation
On August 11, 2005, the Supreme Court of California ruled that former L'Oréal sales
manager Elyse Yanowitz had adequately pleaded a cause of action for retaliatory
termination under the California Fair Employment and Housing Act, and remanded the
case for trial.[13] The case arose out of a 1997 incident in which Jack Wiswall, then the
general manager for designer fragrances, allegedly told Yanowitz to fire a dark-skinned
sales associate despite the associate's good performance. When Yanowitz refused,
Wiswall pointed to a "sexy" blonde-haired woman and said, "God damn it, get me one
that looks like that." Wiswall retired as president of the luxury products division of
L'Oréal USA at the end of 2006.
In May 2007, L'Oréal was one of several cosmetic manufacturers ordered by the
Therapeutic Goods Administration in Australia to withdraw advertising regarding the
wrinkle removal capabilities of their products.
In July 2007, the Garnier division and an external employment agency were fined
€30,000 for recruitment practices that intentionally excluded non-white women from
promoting its shampoo, "Fructis Style" L’Oreal is reported as saying the decision was
"incomprehensible", and would challenge the measure in court.
In July 2007, the British Advertising Standards Authority attacked L'Oréal for a
television advert on its “Telescopic” mascara, featuring Penélope Cruz, stating "it will
make your eyelashes 60% longer." In fact, it only made the lashes look 60% bigger, by
separating and thickening at the roots and by thickening the tips of the lashes. They also
failed to state that the model was wearing false eyelashes.
Brands
Brands are generally categorized by their targeted markets, such as the mass,
professional, luxury, and active cosmetics markets. Garnier - L'Oreal's product, reached
the top 100 brands of The Brand Trust Report published by Trust Research Advisory in
India. Garnier was ranked in the 61st position in the list of Most Trusted brands of India.
Head office
L'Oréal Group has its head office in the Centre Eugène Schueller in Clichy, Hauts-deSeine, near Paris.[18] The building, constructed in the 1970s from brick and steel, replaced
the former Monsavon factory, and employees moved into the facility in 1978. 1,400
employees work in the building. The building is often referred to as the "Beauty Factory"
by the public. In 2005 Nils Klawitter of Der Spiegel said "the building, with its brown
glazed façade of windows, is every bit as ugly as its neighborhood." Klawitter added that

the facility "gives the impression of a high-security zone" due to the CCTV cameras and
security equipment. The world's largest hair salon is located inside the head office
building. As of 2005, 90 hairdressers served 300 women, including retirees, students, and
unemployed people, per day; the customers are used as test subjects for new hair colours.
L'Oréal USA has its headquarters in New York City, its New Jersey headquarters is in
Berkeley Heights.

Centre Eugene Schuler, L’Oreal head office, in Cliché, France

The names of the company’s top 25 brands are given below:1. LOREAL PROFESSIONEL PARIS.
2. KERASTASE PARIS.
3.

MATRIX.

4. REDKEN 5TH AVENUE N Y C.
5. MIZANI.
6. LOREAL PARIS.
7. GARNIER.
8. MAYBELLINE NEW YORK.
9. SOFTSHEEN.CARSON.

10. LANCOME PARIS.
11. BIOTHERM.
12. HR (HELENA RUBINSTEIN)
13. GIORGIO ARMANI PARFUMS.
14. DIESEL.
15. RALPH LAUREN.
16. CACHAREL.
17. KIEHL’S (SINCE 1851)
18. SHU UEMURA.
19. VIKTOR&ROLF.
20. VICHY (LABORATO I RES)
21. LA ROCHE-POSAY(LABORATOIRE PHARMACEUTIQUE)
22. INNEOV (NUTRICOSMETICS)
23. SKIN CEUTICALS.
24. SANOFLORE (LABORATOIRE RIE)
25. THE BODY SHOP.

MOTTO:-

“AT THE DAWN OF THE 21ST CENTURY, THE WORLD’S
LEADING BEAUTY COMPANY NEEDS TO BE AN AUTHENTIC
EXAMPLE IN TERMS OF SUSTAINABLE DEVELOPMENT”
VISION:2007 has been a year of progress on three objectives they set to ensure that
loreal is among the most exemplary companies of the 21st century.
The first priority is economic success, shared by all the employees,
and to which they devote their talents, energy and commitment.
The second objective is to make loreal a company where all employees
thrive both personally and professionally, and where they are able to attract and retain
the most talented individuals. They constantly strive to bring on board staff from
different horizons, nationalities, ethics origins and backgrounds.
The third is to ensure that as a company, loreal is seen as a “global
citizen”. At the dawn of 21st century, the worlds leading company needs to be an
authentic example in terms of sustainable development.

Progress:-

•

They were rated as one of the 100 most sustainable companies in the
world by innovest and corporate knights in January 2008.

•

They were named as one of the world’s most ethical companies by
Ethisphere magazine.

•

They appointed a worldwide director of ethics and launched their new
code of business ethics.

•

They signed up to the French union of advertisers’ (UDA) charter on
responsible communication to promote the positive impact of
responsible corporate communication on society.

•

The L’Oreal corporate foundation was created to fund education,
science and solidarity initiatives, with a budget of €40 million over
five years.

•

They continued to reduce the amount of waste, CO2 emission and
water used, despite the growth.

•

They committed to action on climate change by signing up to the Bali
communiqué , which called for a united nations framework to tackle
climate change .they also joined the carbon disclosure project’s supply
chain leadership programmed to work with suppliers on measuring
their carbon emissions.

•

They got a step closer to eliminating animal testing with the approval
by the EU of the skin irritation test on the Episkin model, and by the
creation of a complete reconstructed living skin model (real skin).

•

Working together with the suppliers, the company assessed 10% of the
raw material using their raw material sustainability assessment
framework.

•

They set up natural and organic center of excellence to develop
products, and integrated six raw materials resulting from fair trade into
the portfolio.

•

CSR Europe, the leading European business network for CSR,
identified the observatories of diversity and social cohension as good
practice.

•

They continue to monitor working conditions in the supply chain, with
585 social audits carried out at their suppliers and subcontractors
factories

Targets:In 2008, the company planed to continue with this progress, with targets
including:
•

Reducing their total CO2 emissions by 2%,

•

Reducing waste by 5%,

•

Sourcing all papers and board used in packaging from sustainably managed
forests, ideally FSC-certified.

Ethics:At loreal, they believe that lasting business is built upon high
ethical standards which guide growth, and on a genuine sense of
responsibility to the community at large.

Governance of sustainability issues:-

Loreal’s progress on sustainability is
driven by a sustainable development steering committee, and this steering committee
reports to the executive committee for sustainable development.
The sustainable development steering committee works on a
number of initiatives those are given as follows:-

•

Raising awareness among employees of our sustainable development initiatives
and performance,

•

Developing relationship with stakeholders, in particular, stronger relationship or
partnerships with NGOs,

•

Further strengthening the work on diversity,

•

Incorporating sustainability principles into the business practices at all levels, the
supply chain and raw material.

New codes of business ethics:Loreal released a new worldwide code of
business ethics in October 2007, which every member of staff received. Employees
representing 22 nationalites were invited to attend international advisory panels to
comment on the draft of the code. The code was reviewed by 50 internal experts and
reviewed by each country manager.

Embedding the new code of business ethics:Two new management
competences have been integrated into loreal’s annual staff appraisal system: “leading
with human sensitivity” and “achieving results with integrity”. An ethics module is
being included into all the “Discovery” induction programmes and in loreal’s country
managers seminars.

Monitoring ethics:Country reporting ethics, an annual reporting system on
ethical issues including prohibition of child and forced labour, discrimination, sexual
and moral harassment and integrity, has been helping assess the groups performance

since 2005. 2008 results showed an increase in communication and training on the
code of business ethics, in part due to the launch of the new code.

Economic affairs :As an international business LOreal is committed to
growth that creates more value for more people with a stake in their
success. The values that underpin the core business will be crucial as they
grow further.

Growth and innovation:Growth was strong in 2008 across all division, as they
each won market share in their respective distribution channels. The growth accelerated
compared with 2007. in terms of innovation, there research teams made several major
technological advances and set up two new laboratories. The first is for organic and
natural cosmetics for the brands THE BODY SHOP and SANOFLORE, and the second
is for instrumental cosmetics to “seize upcoming trends” in this promising area.

A growing market:
2008 was also a strong year for external growth. After successfully integrating THE
BODY SHOP, they started up the DIESEL fragrance business, and began to globalize
SANOFLORE, there organic cosmetics brands. The world cosmetics market grew by
+5% last year. Their share of this market rose substantially to 15.3%.significiant gains
were made on all continents, particularly in emerging countries(such as Asia, Latin

America and Eastern Europe), which became for the first time the largest market , on a
par with Western Europe. Thanks to the diversified catalogue centers, they are perfectly
placed to take advantage of these exceptional growth prospects.
The group’s growth is never at the expense of a
responsible attitude: by manufacturing locally as soon as is practical, the company
contribute to local economic development, applying the principles outlined in their code
of business ethics.

Supplier relations:L’Oreal is committed to building long-term
partnerships with suppliers, based on mutual respect, transparency and
sharing of information, strong communication and high standards.

2007 key achievements:•

Carrying out 585 independent audits on
labour standards at the suppliers,
subcontractors and traders’ production sites.

•

Working with stakeholders to develop a
simplified code of conduct and labour
standards toolbox.

•

Holding the annual supplier forum on the
subject of diversity. Over 100 suppliers took
part in the day long loreal “Together for
diversity” convention, together with several
institutions and NGOs specializing in
diversity.

•

Joining the carbon disclosure project’s
programme to encourage suppliers
disclosure on carbon emissions.

The 40 factories and 65 warehouses of the company manufacture and
distribute products around the world and are at the center of a complex
supply chain. This includes packaging, ingredients, industrial
equipment, promotional items and indirect purchasing. They
manufacture the vast majority of their own products, with only 6%
being made by other companies.
Loreal’s “purchasing code of ethics”:-

The purchasing department integrates
Loreal’s fundamental values in all its dealing with suppliers. All buyers are notified of
their commitment when they take on their position via the purchasing code of ethics, and
undertake to respect all items in this code. In 2008, an updated version was disseminated
to all the buyers.

Internal communication:In 2007, loreal again held several internal events to
raise awareness of their policy on labour standards, attended by the international quality,
development and packaging teams, factory managers, administrative and operations
managers and technical managers.

L’Oreal supplier code of conduct and toolbox:L’Oreal believes that they should help their suppliers and their own supply
chain by providing tools to help implement their labour standards. In 2007, they held
workshops with NGOs, other key stakeholders and loreal departments to build a new type
of code of conduct. This will set out their main requirements in simple terms, and also
provides tools for self-training and case studies of best practice and failures. The final
release is scheduled for October 2009.

The objectives of the company:-

•

Continue work to develop a loreal supplier code of conduct, for
release in 2009.

•

Issue an updated version of loreal purchasing code of ethics.

•

Work with other companies on supply chain initiatives.

•

Hold further capacity building workshops for suppliers on labour
standards and SH&E.

•

Continue work researching the root causes of supplier noncompliance with our labour standards.

•

Encourage environmental innovations by suppliers.

THE DIAGRAM OF LOREAL SUPPLY CHAIN:

PURCHASINGSUPPLY
SUPPLIERS:RAW MATERIALS
PACKAGING
INDUSTREAL EQUIPMENT
INDIRECT PURCHASING
PROMOTIONAL ITEMS

SALES

MANUFACTURING
LOREAL FACTORIES (40):-

STORES:-

94% OF THE FINESHED GOODS

LOREAL WAREHOUSE (65)

SUBCONTRACTORS:-

PERFUME SHOPS
DEPARTMENT STORES

6% OF THE FINESHED GOODS

ETC

LITERATURE
REVIEW

WHAT IS LOREAL?
L’Oreal is the global leader in cosmetics, with 25 global brands. It has five key areas of
expertise- hair care, hair colourants, skincare, make-up and fragrances. This company has
over 63,358 employees working currently. And it sells its products around in 130
countries all over the world. Its consolidated sales are recorded in over 17,063 in million
euros.
The company manufacture well above 4.7 billion units annually. It also
has investments above 560 million euros in R&D investments

DATA PRESENTATION
AND
ANALYSIS

DATA ANALYSIS & INTERPRETATION

1. Do you use cosmetic?
a) Yes
b) No

 65% says- Yes and 35% says- No

2. Are you the L’Oreal customer?
a) Yes
b) No

 70% says- Yes and 30% says- No

3.
a)
b)
c)
d)

Do you wear make-up?
At parties
Always
When I want to
Outside home

Make-up
45
40
35
30
25
20
15
10
5
0
at Parties

Always

when I want to

Outside home

 40% says- At parties, 20% says- Always, 30% says- When I want to and 10%
says- Outside home.

4. How following face foundation have you used mostly?
a) Lakme
b) L’Oreal
c) Avon
d) Others

Face foundation
45
40
35
30
25
20

Loreal

15
10
5
0
lakme

loreal

avon

others

 25% says- Lakme, 40% says- L’Oreal, 15% says- Avon and 20% saysOthers.

5. Which is your Favorite face foundation?
a) Lakme
b) L’Oreal
c) Avon
d) Others

Favorite foundation
45
40
35
30
25
20

Loreal

15
10
5
0
lakme

loreal

avon

others

 25% says- Lakme, 40% says- L’Oreal, 25% says- Avon and 10% saysOthers.

6. What is your skin type?
a) Rough
b) Dry
c) Smooth
d) Oily
e) Spotted

 15% has Rough, 25% has Dry, 30% has Smooth, 20% has Oily and 10% has
spotted skin type.

7. How often do you use cream including night creams?
a) Once a day
b) Twice a day
c) Twice in a week
d) Three times in a week

Using Cream
45
40
35
30
25
20
15
10
5
0
once a day

twice a day

twice in a week

three times in a week

 25% says- Once in a day, 40% says- Twice in a day, 15% says- Twice in a
week and 20% says- Three times in a week.

8. How following creams you have used mostly?
a) Avon
b) Lakme
c) Fair n lovely
d) L’Oreal
e) Others

Using L'Oreal
35
30
25
20
Loreal

15
10
5
0
avon

lakme

fair n lovely

Loreal

Others

 10% says- Avon, 15% says- Lakme, 25% says- Fair n lovely, 30% saysL’Oreal and 20% say- Others.

9. Which one you found more effective?
a) Lakme
b) Avon
c) Fair n lovely
d) L’Oreal
e) Others

More Effective
40
35
30
25
20

Loreal

15
10
5
0
lakme

avon

fair n lovely

Loreal

Others

 15% says- Lakme, 10% says- Avon, 25% says- Fair n lovely, 35% saysL’Oreal and 15% say- Others.

10. Number of customers satisfies with L’Oreal Product in comparison with other
company’s product?
a) Lakme
b) Avon
c) L’Oreal
d)VLCC
e) Others

 15% says- Lakme, 10% says- Avon, 40% says- L’Oreal, 25% says- VLCC
and 10% say- Others.

11. In dealing with make-up, will you take chance with your skin for experimenting
the products of L’Oreal Paris?
a) Agree
b) Agree a little
c) Neither agrees nor disagrees
d) Disagree a little
e) Disagree strongly

 35% says- Agree, 30% says- Agree a little, 20% says- Neither agree nor
disagree, 10% says- Disagree a little and 5% says- Disagree strongly.

FINDINGS

FINDINGS:

On the analysis and interpretation of research conducted. It was found that certain
findings are very critical and are directly or indirectly affecting the L’Oreal Paris
products.

•

There is a good awareness of L’Oreal Paris cosmetics products among the
consumers.

•

The quality of L’Oreal Paris is very satisfactory viewed by the majority of
customers.

•

There is a neck to neck competition between L’Oreal, Lakme,
VLCC, etc

•

75% of the customers are fully satisfied with existing quality
While 25% are partly satisfied.

•

Majority of women are using L’Oreal Paris products.

•

Consumers prefer the L’Oreal products because it provides good quality, good
results, good services, etc and it all fulfills their needs.

CONCLUSION

Conclusion:
The competition is fierce in the multi-channel retailing environment. A business that
hopes to grow and prosper requires a comprehensive logistics and transportation strategy,
executed flawlessly. The dilemma for management lies in trying to meet consumers’
growing expectations while keeping costs in check. In response to these issues of multichannel growth, more and more carriers are branching out to offer logistics services.
Those businesses that work to build successful relationships with logistics and
transportation vendors will find that their efforts lead to improved customer service and
profitability. It’s not an easy task, but it is certainly one that’s achievable with the tools
and technology available today.
L’Oreal Paris has been found to be the most preferred
brand it meet the promise made to the customer. Consumer relies on the L’Oreal Paris products
because it provides good quality, good results, good services, etc. So that customer may prefer

L’Oreal Paris products. While conducting survey I found that the customer may like the
showrooms of the L’Oreal Paris products. They still likes the easily availability of various
products. So the L’Oreal products customers are fully satisfied to use the products.

LIMITATIONS

LIMITATION:
 L’Oreal Paris is involved in doing business for various product categories but in
this it only focuses on cosmetic products, which have to be considered.
 In order to know consumer satisfaction for L’Oreal Paris only 50 female
customers were surveyed.
 The region covered for analyzing was just the overview of the result which is not
enough for measuring the accurate data.

RECOMMENDATION

RECOMMENDATION:
•

The supply must be properly fulfilled so the need of the customer satisfies.

•

Target selling for the dealer / agent can increase the sales ofcompany.

•

The company must concern to the satisfaction of customer demand.

•

The company and dealer should develop its marketing information system.
up to date information of competitor's policy, price and product, target market, so
the company can know its strengths and weaknesses.

•

Brand preference studies reveal that comparatively there is more preference for
L’Oreal among consumers so in order to attract and maintain his consumers.
Advertising programs should be intensified.

•

Perception of the consumer is changing rapidly. They seek new benefits and
values in their preferred brand. Moreover, consumer likes to have brand at low
rate. So L’Oreal Paris should insert it so as to meet the changing preference of the
consumer.

•

L’Oreal Paris is the market leader in make-up products. Most of the consumers
are brand loyal. They should be treated as intangible assets. Loreal Paris should
ever strive to satisfy them.

•

It should keep revitalizing its product / brands.

•

Fulfill the consumer needs.

BIBLIOGRAPHY

A) Web Sites:
1. www.lorealparis.com
2. www.google.com

B) News-paper:
1. Times of India

C) Book:
1. Research Methodology: C.R. Kothari

ANNEXURE

QUESTIONNAIRE
Survey on Women’s Responses towards L’OREAL
(Cosmetics):
1. Do you use cosmetics?
a) Yes
b) No

2. Are you a L’Oreal customer?
a) Yes

b) No

3. Do you wear make-up?
a) At Parties
b) Always
c) When I want to
d) Outside home

4. How following face foundation have you used mostly?
a) Lakme
b) L’Oreal
c) Avon
d) Others

5. Which is your Favorite face foundation?
a) Lakme
b) L’Oreal
c) Avon
d) Others

6. What is your skin type?
a) Rough
b) Dry
c) Smooth
d) Oily
e) Spotted

7. How often do you use cream including night creams?
a) Once a day
b) Twice a day
c) Twice in a week
d) Three times in a week

8. How following creams you have used mostly?
a) Avon
b) Lakme
c) Fair n lovely
d) L’Oreal
e) Others
9. Which one you found more effective?
a) Lakme
b) Avon
c) Fair n lovely
d) L’Oreal
e) Others

10. Number of customers satisfies with L’Oreal Product in comparison with
other company’s product?
a) Lakme
b) Avon
c) L’Oreal

d) VLCC
e) Others

11. In dealing with make-up, will you take chance with your skin for
experimenting the products of L’Oreal Paris?
a) Agree
b) Agree a little
c) Neither agree nor disagree
d) Disagree a little
e) Disagree strongly

NAME…………………………………..…
CONTACT NO. :………………………………….

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