L'OREAL MARKRTING ANALYSIS

1. L'OREAL

2. The L'Oreal Group is a
French cosmetics and beauty company,
headquartered in Clichy, Hauts-de-Seine. It is
the world's largest cosmetics company, and
has a registered office in Paris. 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 dermatology,
toxicology, tissue engineering,
and biopharmaceutical research fields and is
the top nanotechnology patent-holder in the
United States.
L'OREAL

3.  1909-1956 : The first steps, constructing a
model
 1957-1983 : "On the road to the Grand
L'Oreal"
 1984-2000 : Become number one in the
beauty industry
 2001 - Present day : Diversity of Beauty
worldwide
L'OREAL

4. Everyone aspires to beauty. L'Oreal's
mission is to help men and women
around the world realize that aspiration,
and express their individual personalities
to the full. This is what gives meaning and
value to their business, and to the
working lives of their employee.
L'OREAL

5.  Consumer product division
L'Oreal Paris, Garnier, Maybelline NY.
 Professional product division
L'Oreal Professional, Matrix, Kerastase.
 Active cosmetic division
Vichy.
 Luxury product division
Lancome, Biotherm, Giorgio Armani,
Ralph Lauren
L'OREAL

6. 40%
4%
5%3%3%
6%
13%
15%
5% 3% 3%
Others
Lancome
Guerlain
Kenzo
Vichy
Givenchy
Christian Dior
Chanel
Ester Lauder
Yves Saint
Laurent
shiseido
Market Shares
L'OREAL

7.  Universal
 Innovative
 Nimble
 Entrepreneurial
L'OREAL

8.  Unique product
 Stay close with consumer
 Represent slogan by the celebrities or
famous movie stars
 Product segmentation
 Affordable price with high quality
 Given discount to attract consumer
 Category product based on gender
 Promoting collaborative innovation
L'OREAL

9.  Internal Analysis
Strengths
•Strong brand portfolio - Its brand
lineup includes Body Shop, Garnier,
Maybelline, Kerastase and Redken,
all of which are recognized globally.
•Diversified geographic presence -
The company, currently has
operations in over 130 countries
across five continents.
•Strong R&D capability- L'Oreal has
strong research and development
(R&D) capability, focused on
cosmetology and dermatology.
Weaknesses
•Less dynamic in natural/organic
- L'Oreal has been less proactive
in the natural/ organic
category, although it has done
well to revive The Body Shop. It
could benefit from greater
penetration in the category.
L'OREAL

10.  External analysis
Opportunities
•A demographic trend-
Growing beauty
consciousness especially
among the aging baby
boomers is an important
trend for all cosmetics
companies.
•Cosmetics market in
emerging nations- rise for
cosmetics companies due to
increasing popularity of
beauty contests and
increasing disposable
incomes.
•Threats
•Growing popularity of
cosmetic surgery
•Intense competition- The
Company competes in
selected product categories
against a number of
multinational manufacturers.
•Counterfeiting- Counterfeit
products not only deprive
the company of revenues,
but also dilute its brand
image.
L'OREAL

11. Political
 The political challenge is that L'Oreal should
conform to all the different government
leadership styles in various countries it
operates within.
 L'Oreal is obligated to produce safe
products that do not contain any harmful
substances.
 L'Oreal has to follow the rules set by
Advertising Standards Authority. For
example, advertisements cannot be
misleading that over-exaggerating the
functions of a product.
L'OREAL

12. Economical
 L’Oreal’s main consumer products categories are
all highly sensitive to global economies of scale
and scope.
 L'Oreal should adapt to all the different economic
environments and problems in all countries it
operates in. For example in 2004, L'Oreal was
affected by the continued weakness of the dollar
and other currencies.
Social
 The culture of a country consists of the values,
attitudes and beliefs of its people.
 L’Oreal Recognized by Foundation for Social
Change as a "Leader of Change"
 Recognized for approach to sustainable,
responsible and inclusive growth and for
creating positive social impacts while reducing
environmental footprint.
L'OREAL

13. Technological
 Scientific knowledge of the skin and hair
accumulated by L'Oreal for over a century
has opened the way to great innovations.
 Active ingredients, formulation procedures,
evaluation technologies.
Legal
 L'Oreal's legal teams make a vital
contribution and shed expert light on legal
decisions.
 Their missions consist mainly in making
L'Oreal's business operations legally secure.
L'OREAL

14. Environmental
 Environmental concern is L’Oreal use
natural ingredients mostly which is
environment friendly.
 L’Oreal manage a programmed of
internal audits and establish indicators
for measuring and reporting on group
performance in terms of the
environment.
L'OREAL

15. Threat of New Competitors
•Strong distribution network
required.
•High capital requirements.
•Advanced technologies are
required.
•Geographic factors limit
competition.
•Patents limit new competition.
•Entry barriers are high.
Bargaining Power of
Suppliers
•Large number of
substitute inputs.
•Low cost of switching
suppliers.
•High competition
among suppliers.
•Volume is critical to
suppliers.
Bargaining Power
of Customer
•Product is
important to
customer.
•Large number of
customers.
Intensity of Existing
Rivalry
•Fast industry growth
rate
•Large industry size.
Threat of
Substitutes
•Substitute product
is inferior.
•Substantial product
differentiation.
L'OREAL

16. CPM Matrix
Estee Lauder Proctor & Gamble L’Oreal Group
Critical Success Factors W R W.Sc R W.Sc R W.Sc
Brand loyalty 10% 4 0.4 3 0.3 4 0.4
Brand value 10% 4 0.4 3 0.3 4 0.4
Advertising 10% 4 0.4 4 0.4 4 0.4
Product quality 10% 3 0.3 3 0.3 4 0.4
Price 10% 3 0.3 4 0.4 4 0.4
Management 5% 3 0.15 4 0.2 3 0.15
Financial position 5% 2 0.1 3 0.15 4 0.2
Market share 10% 2 0.2 3 0.3 3 0.3
R&D 10% 3 0.3 4 0.4 4 0.4
CSR 10% 3 0.3 2 0.2 4 0.4
Global markets 10% 3 0.3 4 0.4 3 0.3
100% 3.15 3.35 3.75
L'OREAL

17. Loreal, 25.89
Procter &
Gamble,
19.57
Unilever, 16.98
Estee Lauder,
8.29 Shiseldo, 7.75
0
5
10
15
20
25
30
Loreal Procter &
Gamble
Unilever Estee Lauder Shiseldo
Market Share
L'OREAL

18. Specific
Measurable
Realistic
Time
Achievable
L’Oreal’s ambition is for the coming years to win over another
one billion consumers around the world by creating the
cosmetic products that meet the infinite diversity of their
beauty needs and desires.
L’Oreal has set itself the mission to achieve goal by offering
all women and men worldwide the best of cosmetics
innovation in terms of quality, efficacy and safety.
Based on a comparable structure and identical exchange
rates, the sales growth of the L’Oreal group was+5.4% and
the net impact of changes in consolidation was +1.0%.
Maximum recognition for L’Oreal is given by The French
magazine indicates overall champions: L’Oreal, and
pharmaceutical laboratory Sanofi Synthélabo which tie for
the number one ranking.
L’Oreal adventure from its creation more than 100 years ago.
1909-1956 : The first steps, constructing a model
1957-1983 : "On the road to the Grand L'Oreal"
1984-2000 : Become number one in the beauty industry
2001 - Present day : Diversity of Beauty worldwideL'OREAL

19.  Like-for-like, i.e. based on a comparable
structure and identical exchange rates, the
sales growth of the L'Oreal group was +4.0%.
 The net impact of changes in
consolidation was +1.2%.
 Currency fluctuations had an impact of +8.9%.
 Growth at constant exchange rates was +5.2%.
If end of March current exchange rates (€1 at
$1.076) are extrapolated up to December 31,
the impact of currency fluctuations would be
+9.3% for the whole of 2015.
 Based on reported figures, the Group's sales at
March 31, 2015 amounted to 6.44 billion euros,
an increase of +14.1%L'OREAL

20. L'OREAL
QUATERLY SALES GROWTH
€ MILLION 1ST QUARTER 2014 1ST QUARTER 2015 LIKE-FOR-LIKE REPORTED
BY OPERATIONAL DIVISION
Professional Products 735.2 852.6 3.5% 16.0%
Consumer Products 2,758.9 3,078.3 1.7% 11.6%
L'Oreal Luxe 1,460.8 1,753.7 7.5% 20.1%
Active Cosmetics 507.4 559.2 7.6% 10.2%
Cosmetics Divisions total 5,462.2 6,243.9 4.0% 14.3%
BY GEOGRAPHIC ZONE
Western Europe 2,019.9 2,100.4 1.3% 4.0%
North America 1,295.2 1,622.0 2.4% 25.2%
New Markets, of which: 2,147.2 2,521.5 7.5% 17.4%
- Asia, Pacific 1,166.4 1,476.1 5.8% 26.6%
- Latin America 410.9 460.2 10.0% 12.0%
- Eastern Europe 426.8 396.6 9.2% -7.1%
- Africa, Middle East 143.1 188.7 11.3% 31.8%
Cosmetics Divisions total 5,462.2 6,243.9 4.0% 14.3%
The Body Shop 176.4 192.4 4.2% 9.1%
Group total 5,638.6 6,436.3 4.0% 14.1%
Sales by operational division and
geographic zone

21.  After the extensive market research and
studying market analysis ranging from pestle,
SWOT, BCG, SMART, etc of cosmetic sector, we
can conclude that L'Oreal is the market leader
in cosmetic industry with annual revenue of
€22.98 billion and profit of €2.96 billion.
 In 2014, L'Oreal was listed 61st among 1200 of
India's most trusted brands according to
the Brand Trust Report 2014, a study conducted
by Trust Research Advisory, a brand analytics
company.
 Overall the company is at its maturity stage,
performing well and has customer loyalty. Its
innovation strategy gives a scope for greater
market share and penetration.
L'OREAL

22. Thank You
L'OREAL