Keywords: loreal prices strategy, marketing mixture loreal
L'Oreal is a superb exemplory case of how global branding strategy can be used to generate new expansion opportunities when all other companies were not going great weapons. In the later 90's and early on 2000's when the Asian and Latin American economies were shaky and doing inadequately, and numerous international brands struggled, L'Oreal surged ahead. How achieved it happen? The response is based on their wonderfully framed mission assertion as it elaborates their knowledge of the marketability with their product and the necessity of marketing it internationally: "at L'OReAL; we believe that everyone aspires to beauty. Our quest is to help men and women throughout the world realize that aspiration, and exhibit their individual personalities to the full. This is exactly what gives so this means and value to our business, also to the working lives of our own employees. We have been pleased with our work. " (Source: L'Oreal website, www. loreal. com) 1
In 2005, the $18. 89 billion L'Oreal group was the most successful cosmetic makeup products brand. According to the business week survey 2004 L'Oreal was rated 49th. L'Oreal marketed beauty products e. g. Make-up, perfume, and skincare and hair products to men and women in approximately 150 countries. The L'Oreal group reported its 19th consecutive time of double digit progress in December 2005. Since 1989, L'Oreal's sales experienced expanded at a compounded annual rate of 12% to 1 1. 7 billion. Examining the kind of growth story it includes written an analyst has rightly identified it as the US of beauty. the kind of global existence L'Oreal has it can only just be set alongside the United Nations.
L'Oreal's global branding strategy that's doing miracles has been positively spearheaded by Owen Jones himself. Lindsey Owen Jones has been the CEO of L'Oreal for practically 2 decades and a chairman now, and under his control L'Oreal has really fine tuned its global branding strategy. Interestingly some press reports reveal that he has been seen roaming around roads in foreign marketplaces to comprehend the new and existing movements. And with no uncertainties his interesting work style appears to work wonders. The branding strategy of L'Oreal has this impact that L'Oreal appears to be the sole global leader atlanta divorce attorneys section of the makeup products industry, right placement of its products seems to be the key. whatever its trying to sell the French elegance or neighborhood smartness of America; is getting good response throughout the world. and L'Oreal has been able to reach its consumers over the national and cultural boundaries.
Owen Jones says: "We've this great strategy back the head office of how we are going to undertake it worldwide. However when you venture out and appearance at what's happening, will there be a big space in the middle of your projections and the truth of what you see and hear? It is so important to have a world eye-sight because in any other case decentralized consumer goods companies with many brands can fracture into as much little parts if a person isn't pulling it back the other way the complete time with a central perspective. " This really points out why he prefers roaming in the roadways for his strategy making somewhat than sitting down in the boardroom.
Having said everything that its noiseless evident that the global branding strategy of L'Oreal has paid huge dividends to the business overall. In order to understand this splendid growth story we have to see how exactly L'Oreal applied their strategy to the countries which were entirely distinct as far as the approach to life, spending style and culture is concerned. L'Oreal was were only available in France, has a good brand value in the united states of America, is reaping good dividends from India and has a exceptional occurrence in Japan. They are different intricate societies with different needs, just how exactly L'Oreal were able to be evenly successful in every these places? This question needs some simple fact finding to be done on the basis of country specific products and strategies implemented by the makeup products conglomerate. That's what exactly we will attempt doing within the next section of this research study.
In India 4 billion 7. 5 ml sachets can be purchased every year and that's a staggering 66% of total hair shampoo usage in India. A lot of the urban Indian women (96%) use shampoo, however only 46% use basis. For hair caution an enormous 74% population of Indian women still count on home remedies, 42% use henna and 94% use mane oil, as far as the L'Oreal's deal per person in India is concerned is merely 10 cents compared to 28 Euros per person in France. In India skin area lightening creams (fairness creams) constitute more than 50% of skincare market people seem to be crazy so you can get so you can get fairer. (Source: L'Oreal, Nielsen)
These fact is self explanatory about the type of Indian market and it's clearly stating that the strategy used in USA or any other European countries won't work in India. USA is an adult market as far as cosmetics consumption can be involved India is an emerging economy with most of the population below 35 years of age and a huge aspiring middle income. The makeup market keeps growing around at an gross annual rate of 16% in India, still quite a distance going. The children in metropolitan centers is very worried about the image but the larger section is still off the fashion map. Oddly enough even after the success story of commercial India, obviously it's still a country that is very much indeed community oriented. The fantastic Indian middle class is aspiring but nonetheless has the community driven ethnical ideals intact.
L'Oreal has taken this fact quite definitely under consideration while organizing the online marketing strategy for India. A very good example would be the release of garnier fructis shampoo in India. The concept was to count on idea somewhat than relying on advertising a brand. The thought of getting five times better mane was the central point that created the hoopla, through "word of mouth" or network marketing. First it was placed as product for young and teens, once the product was founded in the market it tried to improve or rather raise the target platform by moving gears. In a recent advertising campaign of garnier locks color a princess is shown advising her mom to try the garnier product and detailing the huge benefits. Again it depends on the idea of idea getting propagate by "person to person" to another customer segment. This is the best exemplory case of marketing in a closed &community driven contemporary society. There is one more remarkable thing about this entire marketing campaign the catch lines "take care". It shifts the concentration from the product to the central value of Indian modern culture "caring about others" and the entire ad becomes more of a advice rather than publicity.
China is the world's most populated country on earth and that means it is very clear it has the potential of being the biggest consumer market. Nowadays Chinese language women are spending on an average 10 to 15% of the income on makeup products, an urban Chinese girl would use 2. 2 makeup products on an average each morning. Evidently almost all of them desire to be stylish and the L'Oreal punch range - 'if you want to be trendy, just choose Maybelline', really appears to work. Masses are made to assume that this is something that symbolizes America and it ought to be trendy. Maybelline is the merchandise range for the public and L'Oreal really uses the inclination of public to look towards the united states that's why the Maybelline products are exhibited against the setting of gleaming skyline of New York City Chinese women choose skincare and beauty products. According to a research by L'Oreal in china women are worried about the radiance of their skin and like skin nourishing lotions that protect their pores and skin from skin-drying winters. Unlike us customers most Chinese women like skin area whiteners rather than tanning products. It's a sign of beauty for Chinese language women. Also, the structure of Chinese hair is thicker and even more course than typical US Caucasian wild hair. This involves different product, and a really different expertise to effectively sell and get the products relocating China. L'Oreal has dedicated research facilities for these and other issues, and implemented up with more innovations to suit the needs and choices of Chinese consumers. There is yet another very interesting truth about Chinese makeup industry; Chinese women are incredibly worried about the ingesting of lipsticks. This is the most interesting food frame of mind about Chinese language women. Now after its global strategy L'Oreal even needed this into consideration and developed lipsticks containing vitamins; when this was advised to the ladies they were more comfortable in using the product.
European countries are usually developed, here L'Oreal gets the liberty of publicizing the brand value rather than focusing on pricing, the benefit to L'Oreal in these marketplaces is that it's already more developed and the brand is well known so that it can focus on grabbing the interest of individualistic feminist women. Costs is not a matter in these markets so L'Oreal can afford to own punch lines like-"I am worth it" because these punch lines justify the high rates of the merchandise and fulfill the sense of exclusivity of high end clientele.
Now lets take another example from the Western european and us marketplaces, L'Oreal brands in these market segments are quiet more developed. L'Oreal products have been used there for few generations now; once young consumer of the L'Oreal brand has started out maturing and the same neighborhood smart products could not be positioned to them, they have started out becoming the adult people; now their priorities have modified. A recent market report shows that the new concentrate on segment in the makeup industry is 40 plus women who once used the teenage cosmetics products. The thrust is on anti-aging products because it not only adds the new customer base but retains the once adolescent customer also. Customer from the infant boom generation extends to the retirement age and tries to maintain healthy and youthful look and realizes that a common cosmetics brand continues to be making products for the coffee lover. L'Oreal capitalized on their prefer to look fresh and started out marketing it anti-aging products, it offers agreed upon sixty year-old Diane Keaton to stand for the Age Perfect Pro-Calcium skin care series. Also L'Oreal has agreed upon Scarlett Johansson, Penelope Cruz, Eva Longoria and Beyonce Knowles to promote specific cosmetics lines in line with the age ranges. Now this says us how L'Oreal used the desire of customers to put its products.
The French conglomerate feels that only two different civilizations so far as fashion can be involved, are dominant, symbolized by two flagship brands L'Oreal Paris and Maybelline new York. L'Oreal has been projected as a French origin with elegance, top quality presentation and obviously high costs. Whereas the Maybelline product line represents the street smart American babe who is looking for the worthiness of the money.
America seems to be the growth engine motor of the world, in the cosmetics industry as well. L'Oreal has known this plus they made a technique based on the trends in america and that's how Maybelline had become. Maybelline currently is the second largest brand in show of product sales of makeup products and number 1 in cosmetic brands. It cases to be totally consistent with today's assured woman. Maybelline products goals three customer segments; youngster (16 to 25), office lady (26-35) and profession women (35 plus). Marketing combine for Maybelline line of products includes two main strategies: overseas consumer cultural setting and symbolic New York City imagery that ladies can relate with everywhere. Maybelline campaign include different way of grabbing attention including promotional coupons, online advertising, sponsorship of fashion shows, putting your signature on fashion icons as spokesperson of the product, free make up consultancy and providing scholarships etc. we can see as American aesthetic market is a mature market so L'Oreal tries to rely on adult marketing methods.
In the early 20th century, even American culture was not quite definitely open to cosmetic and skin care products. people thought that only sinful women should wear cosmetic but eventually with the economical self-reliance that the North american women gained; make-up and cosmetics started coming into mainstream. Cosmetics evidently became the mark of new self perception that the American women was beaming with; please remember even Maybelline says to be totally steady with today's women, there are other punch lines like 'maybe she's given birth to with it', 'maybe it's Maybelline', all the punch lines keep carefully the self confidence of women in centre as though its not the constitute but its the attitude that needs to be worn. That is why women of each nationality and culture began identifying herself with the merchandise which became the sign of the 21st century girl.
We always say that the entire world has converted into a small village. Production houses have become more and more global. But same can not be said about the consumers as they might still be using the merchandise because of their own reasons. Someone in the USA can use a product just to feel exclusive however the same product could be used in the united kingdom for health reasons. Therefore the companies need to recognize the requirements of a specific market to effectively meet the demand while planning the globalised marketing strategy.
Therefore the task posed to the companies is if they should just keep changing their strategy according to the culture or can they consider every customer as a worldwide customer with all common needs. That is the irony we are supposed to work with these days; on one hand companies are on a worldwide program more than every other point of amount of time in history however they have to adjust to the mentality and lifestyle of the customer as well.
The attitude and the lifestyle of the client are heavily impacted by the culture. Culture is defined by different norms, values, interactions, language as well as others personal components distributed by groups of individuals around the world. It is a social trend which identifies people's hobbies, thoughts and other behaviors they may exhibit in the sociable life. From one country to another, humans have improved and developed different types of expressions, beliefs and behavior which can be difficult to understand for someone who does not participate in the same culture. culture is just how how the associates of a particular group connect to one another on the sharing of the available means, given that determines what will be the need for a specific product for the reason that modern culture, that also makes a decision whether a particular advertising strategy will work or not and how exactly that'll be interpreted by the prospective customers. In various markets consumer requirements and consumer action may vary. Cultural aspects deeply impact the consumer tendencies; the impact may be immediate or indirect. The culture differentiation creates the buyer behavior difference, as it can be noticed between your Asian and Western continent where the culture and the conducts are incredibly different.
Being a global group L'Oreal certainly must understand the ethnic distinctions and position its products accordingly normally the results may be a lot more different than they are in this instant. The thrust should be on striking the right customer with the right product. This is possible only if you have a deep knowledge of local culture and beliefs. A very interesting example would be of lipstick use within china; matching to a research only 3% women use lipstick for cosmetic. The reason why that was supposed to be behind this low percentage of lipstick use is even weirder; women in china have concerns about ingesting lipstick. L'Oreal conducted a study to see whether this is just an years old telling or it supports some truth, based on the results it developed a lipstick that had vitamin supplements in it and subsequently the demand for L'Oreal vitamin supplements lipsticks increased.
Another example could be real handy; in India long locks is considered essential for a female to be looked at beautiful. L'Oreal considered this fact while starting its shampoo product in India and it centered on publicizing the actual fact that using the garnier fructis hair shampoo assists with getting long and strong locks. This strategy made the product extremely popular in India.
In china or India people prefer to have fair tone. In Asia, women take special attention of their skin area. People want radiant skins and lotions that can nourish their pores and skin against sun. whereas in america people would rather buy tanning cream. On basis of the knowledge L'Oreal can position their whitening lotions in India and the interesting part is what sort of advertising could be interpreted. what sort of advertising for the fairness creams are created in Asian countries these can be interpreted as racial adverts in the USA but in Asian countries that appears to be quiet usual. Now that is where the knowledge of the culture and values comes useful and helps staying away from unnecessary problems. From a small business perspective, companies have to change themselves to the culture of each country in which they would like to have business in. for example,
Because of the dissimilarities of culture between countries, companies need to modify their products and services based on the local needs. This can help these to create and develop a brand image throughout the world that is based on a large number of globally regarded products.
Based on these samples we can say that L'Oreal could achieve success in these marketplaces because it designed to floor realities of the particular market yet it adopted a standardized strategy. If we analyze the marketing mix of Maybelline, it has two pronged strategy -one for the foreign market segments another is the global street-smart image of the American elegant.
The global neighborhood smart image of NY chick can be admired in virtually all the metropolitan centers, be it India, china or Brazil. However there must be a right mixture of local taste as well.
The most important part of the L'Oreal's proper plan is opportunity hunting or the marketing with their products worldwide. From the initial days and nights it already started out providing to the demands of women worldwide. In order to do that efficiently these were expected to be well alert to the diversities of women across the globe. once they understood the diversities their job was to create different line of products ideal to the women from all elements of the world. Innovation has been the keyword for L'Oreal and this was permitted through regular research and development over the years. the group has recently covered most elements of the world but still striving to hide more. In order to do so L'Oreal group must keep respecting other peoples identification, ideas and culture. L'Oreal must keep valuing different civilizations and nationalities to get their brand value up and it appears that they have been doing it really well.
The success account can continue further because right now products of L'Oreal touches the cultural worth instilled in prospective customers head. L'Oreal just doesn't sell the merchandise it makes the customer buy the notion of dreaming big but still remaining rooted to the main cultural values. it includes carefully devised its global marketing strategy and personalized it to the local needs, and that is the reason folks from Africa to Europe and America to Australia are using the L'Oreal products.
L'Oreal has been doing pretty well in conditions of global presence and monetary expansion. The quest today is to understand consumers' needs and anticipations so as to meet them as effectively as you possibly can along with widening the scope of global line of products.
