The environment of L 'Oreal is very competitive and progressive. The trends of consummation force the company to be always more innovative in the production of products, but also in the sale of these products. To continue to be the leader and to compete on the market, L 'Oreal must adopt new strategy in the future in balance with his customers and his environment. So, for the future, she must implement his strategies to continue and improve his efficacy and efficiency. To propose achievable strategies, we will use Ansoff matrix. This tool allows to classify and explain the different growth strategies for a company. Ansoff 's Matrix is also known as the market options matrix (Lynch, 2009, p.313) and is designed to identify “the product and market options available to the organization, including the possibility of withdrawal and movement into unrelated markets”. It is represented diagrammatically as follows. Constraints weighing on L 'OREAL are several: fiercely competitive, abundant supply on all market segments, arrived at the maturity of certain products, significant negotiation power distribution. In this context the company can do that: Market penetration …show more content…
Due to the incredible strength of L 'Oreal 's brand, the company has been able to utilize market penetration on an annual basis by creating an association between L 'Oreal and Christmas or Mother 's Day, Dad 's Day. By offering boxes composed of a multitude of products and promotion, the company allows to introduce its products to its customers or consumers. It offers them several products in the kit so that they can buy them later. Also, she must support the product through innovation and communication with to continue to stand out from the
Marks and Spenser alternative for the substantive growth can take the following strategies, horizontal integration, related diversification, vertical integration and unrelated diversification.
Covergirl is an American cosmetics company. The company was founded by the Noxzema Chemical Company, and later bought by Procter & Gamble. The company is currently the best-selling cosmetic brand in America especially in the teenage marketplace (Debbie, 2006-2014). Being in the first position of the cosmetics market, the company has many competitors, and the biggest competition comes from the Maybelline cosmetics company, this is because both companies offer products with similar prices to similar consumer groups. The company Covergirl cosmetics is more of a brand licence rather a cosmetics company, because it does not provide any face to face customer service at any makeup counters, but they do provide a large variety of products at decent prices, which brings in their customers. The company provides eye shadow, nail polish, concealer and etc. (see fig. 1, fig. 5 to fig. 8), and they sell their products to large distribution centres and a variety of wholesalers. Covergirl cosmetics spends an extensive amount of time and money on reviewing their products, and adjusting them to the latest trends, and tastes of their customers each year. Although the new updates can be very exciting, the adjustments can make it difficult to find the product of their needs and since the company does not provide a personal consultant the adjustments can lead to big problems. So to support their customers with the new adjustments and prevent the loss of customers, the company provides an online service, called the MakeUpdater. Through this service customers can find products to replace their old favourites. The company has many ways to encourage and support their new products one being the free samples which can be received through thei...
For the Company to accomplish its objectives outlined above, a number of strategies will be applied. Below are the mechanisms that the Company plans to employ;
L’Oreal is the largest beauty company in the world and in the past 100 years that it has expanded, it has supplied to 130 countries with offices in 58 different countries. This global company is the number one premium cosmetic product in the world today and has taken the core and beauty of people’s everyday lives since 1907, the beginning of L’Oreal. The superior leadership of a guy named Eugene Schueller started this strategic company with basic products such as hair care and also the first man-made hair color product. Five years later you could find these products in Austria, Italy, and the Netherlands. In 1934 Eugene invented the first mass market of soap less shampoo and this led the success of L’Oreal in the country of 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 new companies and expand it from within believing that the brand could be taken globally and benefit their overall brand portfolio. The main role of acquisitions was to increase and lengthen the internal growth rate. L’Oreal started acquiring companies from the beginning of their name. They started with the basics of their own brands such as L’Oreal Professional, L’Oreal Paris, Kerastase, and Club des Createurs de Beaute.
The strategic recommendations provided will improve and enable the business to cope with the competitors, while the implementation of the strategy section will outline the way to go about achieving these alternatives in the business setting. Lastly, we put up a discussion on the evaluation procedures and necessary controls for the business. In the case study, it was discovered that there were sources of opportunities in which the company would invest.
The Ansoff Matrix was designed by Igor Ansoff. It is a growth based matrix with can increase market share and sales. The Ansoff Matrix classifies strategies whether they are new or existing markets or new or existing products. It includes 4 quadrants which are the Market penetration, Product development, Market development, and Diversification.
The growth strategies are part of Ansoff’s matrix. The first one is the market penetration which is low risk strategy of using low pricing in the short term as a means of gaining entry into a new market or to increase market share or sales volume in an existing market. The second one is product development, this is where the company develops new features on a well-known brand and this is a medium risk strategy. The third is market development, this is where the company launches the same product but in another place, for example global. The last one is diversification, this is a high risk strategy this is when they enter a new market with a new product. Apple use mostly product development, they use these in their IPhone, the IPhone well known
Numerous definitions of strategy exist, in most circumstances strategy can loosely be explained as an overall plan of deployment of resources to ascertain a favourable position within a market (Zablah, Bellenger and Johnston 2004; Grant 1994, p 14). Further, imbedded in many successful organisations are strategies, the importance of which is to remain relevant in the market, and successful in the various attributes of business; profiteering, employee motivation, maintaining sustainable core competencies, effectiveness in operation, or efficiency in the conduction of operations. Therefore challenges involved in the formulation and implementation of a strategy can revolve around the overall external market, as well as internal
• Hitt, Michael A; Hokisson, Robert E.; Ireland, RD. Strategic Management. 6th Ed., Masson, Ohio: Souht. Wester 2005.
“Research and innovation in the service of beauty “ has historically been identified as LOreal’s DNA because of its charismatic founder. His enterprise also continues in legacy at the Eugene Schueller center in Paris with the L’Oreal brand always growing into key markets with inorganic acquisitions.
...ends etc may significantly influence a potential buyer. Moreover a promotional scheme may help in frequent usage of the product by a regular customer; also it may assist in positive feedback to the known ones by the user. Hence it can be perceived that the brand loyalties remain high. That’s why when anti-aging cream was not picking in China, Ponds got some 150 women to try the product without knowing the brand and let them raise their verdict to the world at large. This resulted in an enhancement of 13% sales and many fold raise in the brand goodwill.
On the Ansoff matrix below is shown what growth strategies for new and existing products and markets can be used from the company.
L’Oreal’s problems and root causes should first be identified and addressed. The root causes of L’Oreal’s problems are:
Due to the fact that changing times imply as well a change of society and its changing wants and needs, companies have to be aware that a brand’s position should be adapted to a newly developed lifestyle. “All brands need to be revital-ized on a regular basis in order for them to be kept fresh, vital, and relevant to the contemporary market.” (Keller/Sterthal/Tybout 2002, p. 86).
Colgate Palmolive is the current leader in manufacturing and distribution of oral care and general hygiene products in the world (Crescendo Networks, 2011). Almost all households on the globe use a product of Colgate Palmolive. The success story of Colgate Palmolive started way back in 1873 when its founder, Mr. Colgate, started the company, and ever since, the company has been rising in the corporate world to achieve its current position. However, this does not mean that all has been well throughout. Each business environment has challenges that businesses have to overcome to remain competitive. This is mainly done by formulating and adopting effective strategies that will not only help to overcome the challenge but also to enhance creativity and innovation. At Colgate Palmolive, innovation is highly encouraged and practiced which explains its broad range of products.