L’Oreal
Introduction
L’Oreal is the largest cosmetics company in the world. It shouldn’t be a surprise that L’Oreal doesn’t sell all of its product lines in every market in which it sells, and the market in the Netherlands is no exception. Upper management of the Netherlands’ L’Oreal subsidiary have to make decisions on which product lines will succeed in their respective market and which ones will falter. In this particular case, L’Oreal needs to decide if it would like to introduce Garneir product lines such as the Synergie skin care line and the Belle Couleur permanent hair colorants line into the Netherlands market. The basic problem is whether or not to introduce these lines into the Dutch market.
Situation Audit
In the Netherlands, unlike in France, L’Oreal and Garneir are both sold under the same sales force. This must be taken into consideration considering that L’Oreal has products in both hair colorants (Recital) and in skin care (Plenitude). Fortunately, the Dutch market maybe able to handle both of these product lines from L’Oreal and Garneir if it is felt that they could both be profitable.
When looking at the Dutch market, the most surprising thing is the youth of population. 40% of the population is under the age of 25. This is an important demographic stat because a lot of younger women are the ones who use cosmetics, but it is important to note that the fastest growing populations are those of age 25 and older which might be important to the market of hair colorants. Another interesting trend is the number of Dutch women who work outside the home with a labor force rate of 29% and it is increasing more rapidly than those of other countries like the United States and the United Kingdom. This is very interesting because these women will have more money, independence, and self-confidence. In these terms, these women will more than likely use more cosmetics because of the increase in time that they spend outside of the home. A final insight into the Dutch market shows that Dutch women tend to shop for value, especially in cosmetics, which needs to be taken into account. The overall Dutch market looks somewhat promising to the introduction of Synergie and Belle Couleur lines, but other factors must also be looked at.
While the overall Dutch market is important in the analysis, the product markets might give a be...
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...o use our product because they are out in public and they also have more money to spend on things such as cosmetics. The Dutch women in this market need the Synergie line to give off the idea of a self-concept that can relate our brand image to their needs as a workingwoman. An idea for the advertising campaign could be “You’re working the hardest, shouldn’t you look the best too!” While this product line is marketed towards the workingwoman, the L’Oreal product Plenitude could be marketed towards keeping a youthful look with its ability to delay the signs of aging. The best bet for the profitability of both products is to effectively find a certain image that each consumer can identify herself with. With this, I believe that both products can succeed in the same market and both can have the potential to have large market shares.
Bibliography
Datamonitor, Feb. 2004. Haircare In The Netherlands. Retrieved on April 23, 2005. http://dbic.datamonitor.com.proxy.lib.ohio-state.edu/industries/industry/?iid=Haircare
Datamonitor, Feb. 2004. Makeup In The Netherlands. Retrieved on April 23, 2005. http://dbic.datamonitor.com.proxy.lib.ohio-state.edu/industries/industry/?iid=Skincare
Belle Couleur¡¦s recognition of the constraints of the distribution channel and ability to respond to it would be another major strength. The main constraint in the distribution system would be the limited retail shelf space available to the numerous competing brands. The recent increased preference of retailers as the main choice of distribution for the several competing hair colorant brands has resulted in limited shelf space. So in order to accommodate the limited shelf space, Belle Couleur will introduce only fifteen shades of hair color in the Netherlands as opposed to twenty in France.
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According to the textbook case study, the main reason is due to the market in the United States for cosmetics are very mature, not to mention extremely competitive. Because of this, Avon made the decision to put its emphasis – and resources – in less-competitive markets. (Daniels, 2010)
L’Oreal was started in 1907 by French chemist, Eugene Schueller, who developed the world’s first synthetic hair-color product, L’Aureole. By 1912 his hair products were sold in France, Netherlands, Austria and Italy. In the mid-1930s, Schueller moved into the hygiene and toiletry sectors of the cosmetic market with great success. L’Oreal soon earned the reputation as the leader in European hair coloring and skin care products.
From what historians can gather from Arab oral tradition, the first introduction of Islam into Africa came with Muslim refugees escaping persecution from
...gers he , Ibn Battuta overcame them. Ibn Battuta traveled primarily in Muslim-ruled lands, in comparison to Marco Polo. Both men dictated accounts of their travels after they had returned home Polo, while in prison in the year of 1928 and Ibn Battuta, to a Moroccan scribe, since neither were trained, both Marco Polo and Ibn Battuta judged those they ran into by their own values. Both travels financial records exposed the great variety in Eurasian cultures during the year 1354- 1355. “When a man is riding through this [Gobi] desert by night and for some reason ... he gets separated from his companions ... he hears spirit voices talking to him ...Often these voices lure him away from the path and he never finds it again." This was one of the quotes he had written. This quote describes some part of his travels. He had moved away from people he loved for a few years.
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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.
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