The cosmetics market is one of the biggest markets with technology.It creates a net turnover of 6 per year, 543 billion euros in France and is one of the largest markets in the world. The figure seems impressive; it merely reflects the enthusiasm and buying of more and more beauty products by frequent consumers.
This world market has been growing annually since 1990, twice the percentage increase in world GDP since the same year. It continues to grow even in the most developed countries with the constant discovery of new needs, continuously improving the quality, longer life expectancy and even the extension of skin care products for men.
But the growing market for cosmetic products is especially important in countries recently converted to a market economy. We may think of China or India. In these countries, the correlation between economic development and consumption of cosmetics is strong, whereas the cosmetic gesture is often one of the first acts of freedom.
Globally, the United States and Western Europe are the most developed markets in terms of cosmetics and are 'cash cows' of large groups of cosmetics. In fact, they generate a little less than half the total turnover of the cosmetics market.
With this in mind we will see how this family business has evolved into a world leader in cosmetics.In the first part, we will discuss the group L'Oreal, first in terms of human resources and enterprises in itself.
Then in the second part, we will see the financial aspect of this giant. Then, in the third section, we address the complexity of segmentation and the marketing approach of the group. Finally, in the last part, we will discuss the group's strategy in a comprehensive and long term through its origin, evolution and trends.
L'Oreal is a French company known worldwide with a high turnover of 17.063 billion euros in 2007, an increase of 8% than the previous year. All branches of the group experienced strong growth, despite the exchange rate, which had a strong impact on the consolidated accounts.
As one of the world leaders in cosmetics, L'Oreal is now a group composed of a multitude of national brands. The group knows a well established success. According to Morgan Stanley, L'Oreal is the only cosmetic company that has maintained or increased its market shares in the US.
The company L'Oreal was founded in 1909 initially under the name of the 'French Society of Hair Dyes'. The company then developed and diversified in producing cosmetics to the general public. In 1939, it acquired its current name, L'Oreal.
It has remained a family business. The company is still owned by over 28% by the Bettencourt family, which remains the largest shareholder at Nestle with other small shareholders.
L'Oreal has become over the years a multinational whose parent company is based in Paris. It has 290 subsidiaries worldwide, is spread over 58 countries and distribution is made in 130 countries.The production of cosmetics is made in 42 factories with a workforce of more than 50,000 employees in 2006. These manufacturing facilities are scattered around the world and the 'number of units produced per plant in each region is proportional to the turnover in this area'.
Tags: cosmetics market, marketing approach of L'Oreal, segmentation of L'Oreal
[...] This allows the group to put on a market other than the general public, of luxury. Finally, in addition to this distinction between levels of range, L'Oreal made categories depending on the type of people within these ranges A distribution that does not have only positive effects The major concern of L'Oreal for distribution is that it does not have its own distribution network, that is to say no exclusive store, as we have seen previously. L'Oreal uses only supermarkets or specialty stores to sell its products. [...]
[...] The group wants to expand while keeping up the spirit of cosmetic care and the welfare of the people. It has made a lot of acquisitions, having acquired many companies, brands and labs. The peculiarity of these buybacks is that the group has always wanted to keep the strategies of each group that it took over. We have the example of The Body Shop: the general policy of the company remained unchanged. The key success factors (CSF) are the strengths and/or skills and basic resources that every company in this activity must have for securing a sustainable and defensible development. [...]
[...] With this in mind we will see how this family business has evolved into a world leader in cosmetics.In the first part, we will discuss the group L'Oreal, first in terms of human resources and enterprises in itself. Then in the second part, we will see the financial aspect of this giant. Then, in the third section, we address the complexity of segmentation and the marketing approach of the group. Finally, in the last part, we will discuss the group's strategy in a comprehensive and long term through its origin, evolution and trends. [...]
[...] It has had no exclusive store and depends on perfume and beauty care centers to be sold Recommendations that could be used Strategic Options Policy Option L'Oreal should not change its current position Keep its leading position in the market of cosmetics, group L'Oreal should do nothing to change this fact. So it could continue its business strategy by including: diversify even more to have a brand portfolio that is increasingly important continue to expand into foreign markets continue its policy of innovation extend its differentiation strategy However this solution seems very relevant as its competitors (Procter & Gable, Unilever, LVMH) lead the same business strategy and might overtake the group in terms of market shares which may not allow it to keep its leadership position. [...]
[...] However, some stand out because they either have the same characteristics as the L'Oreal Group or because they have the same type of products or strategy. The directorship of L'Oreal, renewable, has a statutory term of 4 years. The directors hold at least 1,000 L'Oréal shares. In accordance with the laws and Viénot button, it was decided at the AGM on April to separate the roles of Chairman and CEO The scheme of the five competitive forces in the cosmetics industry The cosmetics industry is a competitive environment with many actors. [...]
APA Style reference
For your bibliographyOnline reading
with our online readerContent validated
by our reading committee
