Mass market leadership and shampoo wars: al strategy the LOre

Laurent Tournois

Laurent Tournois is DBA Program Director and Marketing Professor, Doctoral School and Marketing Department, Grenoble Ecole de Management, Grenoble, France.

Introduction
The modern market environment, which combines low demand with strong competitive pressure, is unsettling for most companies operating in mass markets. The Boston Consulting Group (2010) has identied innovation as a pillar of growth in this context, but the question still remains: is it preferable to satisfy existing consumer needs, thus adapting to market conditions, or reveal their latent needs, thus seeking to change the conditions? Such concerns also appear in a growing body of academic research on the topic of market orientation, dened as the organizational culture that most effectively and efciently creates the necessary behaviors for the creation of superior value for buyers and, thus, continuous superior performance for the business (Narver and Slater, 1990, p. 21). The issue of creating customer value, and its corollary, satisfying current and future customer needs, also parallels the heart of the debate between offensive and defensive management. Defensive, or market-driven, management refers to learning, understanding, and responding to stakeholder perceptions and behaviors within a given market structure (Jaworski et al., 2000, p. 47). Offensive management, synonymous with guiding the market, refers to changing the composition and/or roles of players in a market and/or the behavior(s) of players in the market (Jaworski et al., 2000, p. 47). In examining the articulation of these approaches, the authors postulate that they are not antagonistic but rather complementary, and companies in certain conditions can engage in both simultaneously. Yet, we know little about how the two approaches coordinate at the aggregation level of a portfolio of brands or products, and this lack of knowledge may hamper their simultaneous adoption and implementation. Moreover, to the best of our knowledge, no explicit reference in the research indicates the position (i.e. leader or challenger) of the focal company or brand in the market, even though this position determines whether the product policy is proactive or reactive (see Shankar, 2006). The benets of each approach remain to be evaluated through a combination of information and comparison (demand and supply sides). With this single case study, we analyse this phenomenon in depth to reveal the dynamics underlying marketing-oriented strategies in the form of iterations between theory and management practice(s). We illustrate that the choice of offensive or defensive management determines the type of product strategy implemented by a company. We evaluate the results of each approach with a performance review of a portfolio of brands and products at retail points of sale. Although the inherent limitations of the case studied suggest some caution, we carefully formulate managerial recommendations and conclude with an explication of remaining challenges and future perspectives.

The author would like to thank al Group for its support. LOre The author beneted from a Research Contract in 2010 at als Consumer Product LOre Division based in Paris/Saint-Ouen (France).

als Consumer Products Division LOre

als Consumer Products Division (CPD)[1] (see www. We consider the development of LOre loreal.com/_en/_ww/index.aspx?direct1 00003&direct2 00003/00003) in its domestic ` ve[3], its central offering in the market[2], and particularly the performance of the brand Else

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VOL. 34 NO. 1 2013, pp. 4-14, Q Emerald Group Publishing Limited, ISSN 0275-6668

DOI 10.1108/02756661311301738

 [. . .] creating customer value, and its corollary, satisfying current and future customer needs, also parallels the heart of the debate between offensive and defensive management.

al[4] considers this brand the primary driver of its effort to hair care market segment. LOre penetrate the global cosmetics market. The company already is a leader in the cosmetics al, 2012). Since its industry, with reported consolidated sales of e20.34bn in 2011 (LOre al has spread to 130 countries, though its headquarters remain founding in 1909, LOre located in Paris. We extracted the data for this case study from the IRI Census Database[5].

The domestic market

al celebrated a century of leadership in the cosmetics industry, due largely to In 2009, LOre its conquest and domination of various market segments across Frances hygiene and beauty markets its historical scope through its CPD. During this period, the CPD practised both defensive management, by adapting to market changes, and offensive management, by manifesting a desire to drive market changes (see Gotteland et al., 2007). These practices emphasise the trajectory of the CPD in the market between 1909 and 2012, which has accounted for the initial structure of the market, changed the behaviours of players in various segments, contributed to its growth, and enjoyed an improving competitive position at the expense of competitors. To manage a portfolio of brands and a wide range of products, the combined offensive and defensive management relies on an architecture with three levels of aggregation. First, an entrepreneurship approach aimed to build the foundations of the CPD so that it could develop a portfolio of brands. Second, a market occupation strategy was implemented ` ve from LOre al Paris. Third, the through the development of leading brands, such as Else leading market position led the company to adopt a product proliferation strategy. These three phases have been gradual, though. Over the entire period, the defensive and offensive approaches succeeded in a sequential scheme that reected market conditions, including the state of (consumer) demand, market growth rates, and competitors moves. Accordingly, this case study is structured into three elements: 1. the foundations of the CPD; 2. the market occupation strategy and leading brand development; and 3. from brand to product proliferation.

Foundations of CPD: scientic progress drives change

The mission of universal beauty began in France in 1909 through constant exploration of new al made its mission into an art, with the aim of territories thanks to scientic progress. LOre always offering more value to consumers worldwide. Thus its story entails both scientic and aesthetic conceptions of beauty; it also planned international outreach with Paris as an epicentre, which produced strong ethnocentrism. Yet the company claims the values of modernity, and a scientic spirit has always predominated. For example, in 1910, Eugene al as a large dye university, rather than a Schueller described an early version of LOre commercial enterprise. The founder of LOreal was a chemist, scientist, and inventor who printed forever in the genetic code of LOreal the love of a product, the faith in research and al from 1988 to 2006 a taste for work, according to Lindsay Owen-Jones, CEO of LOre al, 2009). (LOre

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However, the original innovation was one of a mental model that was profoundly different and disruptive. Instead of considering modernity as unique and anchored in the present day, Schueller relied on the practices and particularities of other, more traditional cultures and reviewed them as if they were multiple case studies. These investigations affected his way of seeing beauty and his approach to product innovation. Other cultures geographic and symbolic diversity offered various realms for research and product development, including branded hair care, make-up, and other beauty products created for different ethnic groups. Furthermore, Schueller democratised access to beauty and understood that pursuit of youth was a universal quest, across all social classes and times: this was the birth of markets that did not exist in the modern sense of cosmetics. At the beginning of the twentieth century for example, dyed hair was only for unrened women. By focusing on non-consumers and their latent needs, Schueller identied the principal deterrents to using hair dye and managed to convince reluctant women through advertising that insisted on the benets of dyeing white hair to look younger (see Table I). This promise represented real added value for consumers and the company, and it eliminated competition by creating a completely new, undisputed strategic space (Kim and Mauborgne, 2004). The rst harmless hair dye was introduced in 1909. al poster, The Comet by Raoul This created value had to be communicated; the rst LOre Vian, conveys a sense of beauty, avant-garde aesthetics, and strong (even brutal) communication codes. In recommending hair dye for white hair, for example, it offered a straightforward message: You are too old and Would your husband still marry you?. This management effort was offensive; the company not only inuenced the structure of the market but also the behaviours of market players in a way that improved its own competitive position (Jaworski et al., 2000). Progressively, the market-oriented strategy implemented at als CPD played a crucial role in widening the consumer base by continuously LOre reinforcing the attraction of its brands, thanks to accessible outreach efforts during the following 100 years.

The market occupation strategy and leading brand development

To be market-driven: establish and strengthen leadership over the market The hygiene and beauty market experienced strong growth across all segments until the mid-1990s. Technology diffusion and adoption by a growing number of competitors played important roles; during this period, brands also confronted an increasingly segmented market, inuenced simultaneously by diversied offers and improved consumer awareness of hair and skin concerns. Finally, an important feature of this competitive environment was the gradual specialisation and differentiation since consumers became more sensitive to the perceived quality of the offer than to its (perceived) price. These factors drove the CPD to adapt to market changes. That is, the CPD acted mainly to satisfy customers expressed needs, achieve differentiation on comparable attributes relative to competitors (see Jaworski et al., 2000), and cover the entire cosmetics market with a ner segmentation of its offerings. Through its regular examinations of womens beauty routines and recognition of the limited current offerings available through cosmetics, the CPD came to focus on acquiring and deploying (new) technical competencies, allowing for a greater consideration of biological dimensions and tests. For example, scientic tests of Table I
Create Augment Reduce Eliminate Source: Adapted from Kim and Mauborgne (2004) Beauty and youthful appearance Modern image through publicity Usage facility and access Preparing, applying, and waiting time Harmful formula (making hair dye safer) Negative associations

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hair helped identify physical weaknesses that could cause split ends, which led to the development of a Ceramide-R molecule that offered an asset base for a range of hair care ` ve brand. products targeting people with dry, brittle, or damaged hair under the Else This defensive approach served as an introduction to the gradual implementation of a strategy aimed at occupying all market segments. In this process, the CPD refocused its attention on growth areas where it already possessed scientic and business knowledge: hair care, skin care, make-up, personal hygiene, and perfumes. These centres of expertise provided premises for establishing the CPDs competitive sanctuary throughout the 1990s. Within this sanctuary, the company attempted to ensure, organise, and manage protable market occupation by creating a mosaic that would spread over all hygiene and beauty areas: from `ve to Gemey-Maybelline, from Fructis to Jacques Dessange, from Ushua a to Elnett. Each Else brand offered a different story and personality, and they served as tangible illustrations of the companys ability to brand its competitive advantages. Thus the CPD remained a problem solver. The cosmetic offerings had become more diversied, but the value proposition remained functional. Although the intimate nature of some products, such as skin care, required some caution and subtlety, the CPD still was inuenced mainly by scientic progress, achieved through R&D at the crossroads of physics, chemistry, biology, and electronics. But the CPDs intimacy with customers was only rational and thus raised a new question: is our goal to be the best objectively or to be the customers preferred brand? Driving markets: from function to feel The purpose of an offensive management is to inuence indirectly the behaviour of market players in a direction that enhances the competitive position of the business (Jaworski et al., 2000). In this case, the company tried to satisfy customers latent needs and differentiate its offerings on attributes that are not comparable to competition (Gotteland et al., 2007). At this point, what can push a company to move from a defensive to an offensive management? We posit that the transition depends on the occurrence of an event that is bound to a structural change in demand or behavioural modications by one or more competitors, or some combination of the two. The stressor will force a dominant player (i.e. the leader) to change the rules of the game to its advantage if it hopes to maintain its position in a stagnant market segment where there still might be untapped growth potential. This situation marked the hair care market (mainly shampoos and conditioners) in France in al Paris Else ` ve was the leader, 1997, dominated by brands from the CPD portfolio: LOre protected by two strong ankers the Dop and Ultra-Doux brands at the lower end of the market and Jacques Dessange at the high end. In 1997, the launch of the new Fructis brand complemented these offerings by responding to a growing demand for natural products. This market occupation strategy aimed to limit competition. Yet the stability of CPDs sanctuary was threatened by the arrival of a new competitor in June 1997, through the relaunch of Pantene Pro-V by Procter & Gamble. Previously a minor player with a very small volume market share (1.7 per cent), Pantene was suddenly thrust into second place, with 8.6 per cent of volume market share, before Fructis (7.7 per cent) ` ve, which simultaneously was losing ground (9.9 per cent) (see Table II) and closing in on Else al, 1997). (LOre Table II Volume market share
Shampoo ` ve Else Fructis Ultra Doux Dop Jacques Dessange ` ne Pro-V Pante 1996 (aggregate data) 10.4 1.6 8.7 5.0 6.2 1.7 23 November 1997 9.9 7.7 7.1 5.2 4.7 8.6

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During the week of 16-23 November 1997, Pantene became the top brand in terms of al, 1997). In this shampoo segment, the most affected brands demand (see Table III) (LOre in the short term were Jacques Dessange, Ultra-Doux, and Fructis. In addition, in the hair ` ve lost 4 per cent of volume conditioner segment, Fructis maintained its position but Else market share after the Pantene relaunch. By November 1997, shampoos had gained a slight recovery, with 1.1 per cent growth in volume compared with the same month in 1996. This development likely was attributable to the launch of Fructis and the relaunch of Pantene, whereas the vast majority of brands were al, 1997). These results further going backward compared with 1996 (see Table II) (LOre ` ve brand, which was show that the strong ankers played their part well in protecting the Else less impacted by improvements in the Pantene brand. Nevertheless, its leadership was not as strong, and the market segment had not been growing much, so gains in market share by competitive players could not be generated just by more purchases. Did this situation demand a signicant response from the leading brand? Pantene proposed improving existing functional benets, so changes in the market, or defensive management, would imply a search for differentiation on incomparable attributes, that is, beyond price, promotion, or media mix. Therefore, the response needed to provide more than an incremental improvement of an existing benet and instead introduce a new benet within the marketing mix. An emotional benet thus was added to the value proposition, as communicated by the new tagline, Because Im worth it (see Table IV). In this market segment, Pantene chose to lead an attack from the top of the market against ` ve. Its price positioning was well above the average market price, and 10 per cent Else higher since its relaunch, making the brand one of the most expensive in the market, equivalent to brands like Jacques Dessange, which rely on the legitimacy and reputation of Table III Demand and market share
Demand: 16-23 November 1997 week 1. Pantene 2. Fructis 3. Ultra-Doux ` ve 4. Else 5. Palmolive (Colgate) 6. Dop 7. Jacques Dessange Volume market share: 11th period of 1997 (aggregate data) ` ve 1. Else 2. Pantene 3. Fructis 4. Ultra-Doux 5. Palmolive (Colgate) 6. Dop 7. Jacques Dessange

Table IV
Pantene Pro-V: For hair so healthy it shines Positioning Promise Benets Reason why Care Brightness Rational: healthy and bright hair Emotional: look and beauty Customised care (Royal Club Evian) Pro-vitamins B5 Elite Agency models Problem/solution/results Sampling Mixed television press public display, product-range ad Lower than market average . 16 French Francs, premium pricing ` ve Multivitamins: Because Im worth it Else Beauty Brightness Rational: beauty of hair Emotional: well-being, beauty and success Top model Claudia Schiffer Vitamins E PP B5 al, the cosmetic world leader LOre Results/revelation Mixed television press, leader reference ad

Brand talk scheme Communication/advertising

Promotions (/total sales) Price

Equal to market average 16 French francs, value for money

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the expert hairdresser. Consistent with this high-end positioning, the share of products sold on promotion by Pantene generally was quite low, in a usually heavily discounted segment. In contrast, 45 per cent of the volume sold on promotion reected three brands: Palmolive, ` ve Dop. Pantene accounted for only 4.3 per cent of product ows. In the Fructis, and Else conditioner market segment, 70 per cent of the volume sold on promotion came from Fructis, ` ve, and Dessange. Pantene was in the fourth position with nine per cent of the ows Else al, 1997). (LOre During the summer of 1997, Pantene launched a sampling campaign for 20 million households. Whereas television is a privileged medium, such that more than 80 per cent of this markets advertising investments go to it, Pantene chose to mix television (65 per cent), printed newspapers (8 per cent), and display promotions (27 per cent), a rarely used al, 1997). medium in the hair care market segment (LOre ` ve decided to increase customer perceived value, Instead of competing head on, Else compared with its rivals offer, in a legitimate move to coordinate the components of its value proposition. Pantene highlighted its care positioning in a universe that pushed its product to ` ve focused on expert, elegant, glamorous beauty. These attributes premium status; Else were not comparable to the competition at the time. al Paris with a reputation for being The next process of legitimation worked to connect LOre the world leader in cosmetics through its choice of Claudia Schiffer as a spokesperson. The ` ve popular and beautiful model served as the symbol of and ambassador for the brand. Else then became synonymous with seduction and success a relatively radical change in positioning. There was no longer any mention of problems, and effectiveness relied not on vitamins but on being the best beauty product. The shampoo symbolised a dream, not just a resolution for a hair problem. This emerging archetype of beauty appeared at the crossroads of clinical effectiveness and emotional and sensory attributes. It embodied the revelation of a universal latent need for self-esteem, which became manifested in all brands bearing the same signature, LOreal Paris. The marketing communication also presented a fantasy image where the consumer was valued and supported by a claim focused on women and their independence: Because Im worth it. This advertising message therefore served as a rallying theme for targeting the brand at female consumers concerned about their appearance and ready to pay a mid-market price for a product that offered greater perceived quality than its competitors. During this period, the brands celebrity endorsement policy also became institutionalised through the presence of a broad pool of icons from motion pictures and fashion, representing various nationalities and backgrounds. The rules of the game in the cosmetics mass market also changed due to the growing distance from existing offerings, which helped add a non-comparable, emotional component to the value equation and revealed a strong latent need. Therefore, this type of management can be described as offensive since the company inuenced the market structure as well as the behaviour of current market players in a way that improved its competitive position (Gotteland et al., 2007). As a result, in the period from 1988 to 2000, joint offensive and defensive approaches allowed LOreal (CPD France) to improve its market leverage in the cosmetic, beauty supply and hygienic markets. In the hair care segment, its brands made up 61.4 per cent of the volume sold in 2000 (versus 51 per cent in 1988), with even stronger growth in value (63.2 al, 2001), a level of performance not reached in per cent versus 48.9 per cent) (LOre subsequent years. The success of a strategy requires an evaluation at time but also a consideration of the ` ve had 15.5 per companys ability to maintain or increase its performance levels. In 2003 Else cent of volume market share in the shampoo segment (versus 3 per cent for Pantene Pro-V) and 17.9 per cent in value market share (versus 3 per cent for Pantene Pro-V) (IRI, 2003). (4.6 per Beyond the CPDs own portfolio of brands, the main competitors included Timote cent of volume, 4.3 per cent of value), Palmolive (3.8 per cent of volume, 2.3 per cent of

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value), Dove (3.5 per cent of volume, 3.7 per cent of value) and private-label brands (8.8 per cent of volume, 4.7 per cent of value) (IRI, 2003).

From brand to product proliferation

Increasing numbers of brands and product, which offer the benets of greater choice for consumers, have been referred to using various terms, such as proliferation or market occupation strategies. It generally is the privilege of market leaders (Shankar, 2006), whereas followers and other competitors must rely on low price promises or be satised with als brand proliferation with a small targeting a niche market. The CPD orchestrated LOre team that deployed formal processes to coordinate market-oriented strategies for different al Paris, brands or businesses in the companys parlance (e.g. LOre Gemey-Maybelline-Garnier, Lascad). The main aim of this deliberate strategy was to restrict competitors expansion possibilities and block their penetration in different market segments by promoting systematic consumer purchases of multiple products from the brand portfolio. In parallel, to maintain its dominance over every market segment, the CPD implemented a market-driven approach to increase the number of product references and brand franchises a term that refers to the aggregate level between the brand and the branded al Paris, an affordable luxury line that expressed expertise, product. For example, for LOre glamour, and multicultural beauty featured brands whose primary goal was leadership in ` ve in the hair care segment, Excellence for hair each segment of the cosmetics sector: Else al Paris for make-up, Studio Line for colour, Dermo Expertise in the skin care segment, LOre hair styling, and Men Expert in the mens segment. A decade of internationalisation and virtually uninterrupted growth followed. But this remarkable performance also hid some increasing weaknesses in mature markets, and particularly in its domestic market of France. To understand these developments, we undertake a long-term analysis, which reveals that though it had been the uncontested ` ve was struggling. From 2002 to 2009, Else ` ve fell prey to a market share trap, as leader, Else its market share in volume (around 17 per cent) and value (around 19.8 per cent) remained largely stable, even as the overall market decreased in volume (2 5.8 per cent) and increased in value ( 2.4 per cent) (IRI, 2002, 2009). Perhaps most important, the intense development of franchises which served as notable symbols of the internationalisation of its brand portfolio did not offer additional gains to LOreal. In the hair care market, the average number of product references increased from 10.3 in 2003 to 16.2 in 2009, or 57.3 ` ves diminishing strength in its per cent (IRI, 2003, 2009). Thus, in a direct comparison, Else segment was even more substantial. Even by increasing its offers, the brand could not improve its performance, likely because of its micro-segmentation strategy that combined differentiation criteria, such as hair type coloured problems (dandruff). The segmentation increased the number of functions and led to ever-narrower niches (Smooth-silk Intense, Smooth-silk Light, etc.). Thus, the results showed that the emblematic market occupation strategy of the CPD since the mid-1990s had been gradually undermined. When brands confronted excessive search for value, it led to physical (shelf) space limitations and consumers cognitive exhaustion. As the proliferation strategy spread, orchestrated by an increasing number of internal players and applied to every market segment, consumer benets ultimately stopped growing.

The mission of universal beauty began in France in 1909 through constant exploration of new territories thanks to scientic progress.

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 [. . .] the company attempted to ensure, organise, and manage protable market occupation by creating a mosaic that would spread over all hygiene and beauty areas.

Further investments in the development and commercialisation of innovations produced little in the way of returns.

Lessons learned
als Consumer Several lessons emerge from this history of the competitive path of LOre Products Division in its domestic market (France). First, the joint management of offensive and defensive market-oriented strategies depends on market conditions that include the level of demand and competitors moves but also on the leadership position of the company/brand. When it obtained a favourable competitive position, in terms of its expertise in the hair care market for a key target segment (e.g. professional hairstylists, the original target), the al was to consolidate and disseminate its reputation for superiority challenge for LOre throughout other channels, which would expand its consumer base. This task was assigned to the CPD and achieved through a product proliferation strategy, supported by the development of strong brands through market occupation. Thus, the two approaches are complementary. Second, the relationship between defensive and offensive management is rooted in a dynamic approach that borrows from military language: the offensive was led by the continuing quest for distinction and differentiation through innovation; the defence relied on its already gained competitive positions. al has always focused on differentiation through innovation as a growth driver. In Third, LOre such conditions, it was challenging to create more value for customers than competitors could. To do so, it needed to turn to the very foundations of its market orientation: learning from the experience of other companies/competitors to continually generate knowledge in its target markets, and reect the knowledge in its market behaviour (e.g. Day, 1994). Thus, the underlying idea is that of sustainability of marketing positioning: it depends on the distinction that underlies it, the reason why, in short, be it scientic, clinical, etc. Reducing this unique feature moves the brand closer to its competitors. For this case, the solution demanded a review of an essential need in the product category.

Managerial implications
No brand can maintain a universal, unchanging, and inimitable differentiation forever. The exclusive and justiable differentiation underlying the positioning of an offering is appreciated in a context of changing market conditions. Especially in mature markets, demand can decline, competitive pressure can increase, and consumers may grow less sensitive to perceived quality and increasingly sensitive to price. Thus the main danger for managers may be the mechanical nature of the approach we have described: a self-replicating pattern that does not stimulate questions about the existing mental models. The ability (or inability) to manage offensive and defensive approaches jointly requires assumptions about the nature of the surrounding environment (Jaworski et al., 2000). Beyond growth and decline cycles, rms must maximise their value in the present and the future, especially in the face of ongoing and increasing commoditisation (see Dussart, 2010). Through this well-known, entropic phenomenon, over time, the brand underperforms

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` ve brand could happen to any leader operating in a the market. What happened to the Else consumer goods sector in mature markets. Finally, managers must monitor the following indicators over time: comparisons of the markets and segments growth rate, changes in volume and value market shares, and the brands contribution to the growth of the overall market segment.

Conclusion, current challenges, and future perspectives

als Consumer Products Division is that the The main result of this case investigation of LOre articulation of offensive and defensive market-oriented strategies entails a trade-off based on market conditions (e.g. competitive pressures, presence of power relations among players, changes in demand). The challenge is to achieve the most favourable combination in a timely fashion to conquer a market and achieve a dominant position. This scenario also implies several important decisions about the product policy that must be implemented by a ` ve brand suggested that drastic drops in market market leader. The situation of the Else share were challenging the relevance of marketing strategies that had been implemented for at least a decade, by many leading brands. Are conventional market-oriented strategies simply failing? And if so, should revisions be designed within the framework of existing innovation models, or should they challenge even the most conventional wisdom (i.e. top-down and West-to-South-to-East)? To some extent, these questions reect the current state of markets; we must consider mature markets from a more fundamental perspective, going beyond a focus on performance that is both restrictive and unsatisfactory. Instead, it is necessary to consider ` ne Schueller, had listened when his boss a state of mind. If the pharmacists assistant, Euge proclaimed, Hair colour is a market with a limited future; you are going to have a hard time al, 2009), he never would have started his own company and LOre al would not exist (LOre in the rst place. Opportunities are rooted in almost every segment, provided that companies can reconsider the meaning of beauty and the daily, detailed consumption routines embraced by consumer targets. In the current market conditions, a successful market-oriented strategy could identify latent needs not addressed by existing offers or even those areas in which competition is lower and for which the company has some als Consumer Product Division, those dynamic technological competencies. For LOre capabilities constitute the true foundations of its continuing success: the ability to brand almost every competitive advantage obtained through advanced technology. Opportunities lie in the type of environment where international companies have operated for almost a decade, characterised as a new normality (see Guillen, 2011). Compared with rapidly growing countries such as China, India, or Brazil, mature economies such as the USA and countries in Western Europe predict at best growth rates of 1.4-1.7 per cent per year during the 2010-2020 period. For example, in the rst quarter of 2012, new markets als leading growth (i.e. Asia-Pacic, Latin America, Middle East, Africa) became LOre al CPD brand drivers. A key assumption underlying the international spread of the LOre portfolio is that beauty aspirations are universal. To address the threat of a company rift between R&D and international development, top management made some important trade-offs: sacrice the pluralism of individual identities for a trans-national image, while still protecting the brands identity as rmly rooted in France so that it can continue to draw on a al Paris rich cultural heritage embedded in the collective imagination, under the LOre banner.

An emotional benet thus was added to the value proposition, as communicated by the new tagline, Because Im worth it.

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Keywords: Market-orientation, Offensive and defensive management, Product proliferation, Differentiation, Commoditisation, Brand portfolio, Market share, Retail panel data, Brands, Leadership

al also has identied new sources of innovation. To In these management paradoxes, LOre do so, it needed to understand the ow reversal: Value now ows from emerging markets to mature markets. For example, the global laboratories in Brazil and China have helped develop several frontier products in the make-up product category, including product ` ve Total Repair 5 in the hair care product innovations such as Garnier BB Cream, and Else category. These innovations were introduced gradually into mature markets, which helped restore the competitiveness of several leading brands in CPDs portfolio. In August 2009, the ` ve, which was facing some challenges, as our case Total Repair 5 franchise supported Else study describes. In the short term, it also enabled the brand to attract new, younger female consumers. Then in the long run, Total Repair 5 played a pivotal role across the range of ` ve franchises (e.g. Colour Vive, Liss Intense). The success of the launch helped restore Else ` ve in the hair care segment, supported the launch of other franchises to the legitimacy of Else renew the product portfolio, and improved brand performance. Again, the brand ` ve grew by outperformed the market: in the third period of 2012 (aggregate data), Else 1.2 per cent and 6.8 per cent in volume and value, respectively, compared with the same period of 2011 (IRI, 2011, 2012). During that time the overall hair care market grew by 0.7 per cent and 3.2 per cent in volume and value market share (IRI, 2011, 2012). Furthermore, ` ve (total in a comparison of 2012 and 2009 (third period, aggregate data), we nd that Else hair care market) reached 17.2 per cent (16.3 per cent) of volume and 20.2 per cent (19.8 per cent) of value market share (IRI, 2009, 2012). Do these innovations offer an ultimate defensive management approach, or are they a new form of offensive management contained within market-oriented strategies? More research is needed to investigate whether they have shaped consumer preferences or not, as well as to validate how reverse innovation produces high performance returns, whether markets are marked by high, medium, or low levels of technology. Finally, we acknowledge that it is not just the competitiveness of brands and companies but also their survival that may be in question in the current market conditions.

Notes
1. The Consumer Products Division (CPD) is responsible for products commercialised through retail distribution channels. 2. Retail distribution channels (e.g. hypermarkets, supermarkets, hard discounters, etc.) represent the perimeter for our analysis. ` ve from the French market is generally known as Elvive in the European market. Recently, it was 3. Else introduced as EverPure, EverCreme, EverStrong, and other related lines in the US market. al refers to the whole group, LOre al Paris is an umbrella brand that belongs to the 4. LOre ` ve is a brand under the umbrella of LOre al Paris. Consumer Products Division, and Else 5. Concerning retail panel data, a period comprises four weeks and a year comprises 13 periods.

References
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About the author

Laurent Tournois (PhD) is DBA Program Director and Marketing Professor at Grenoble Ecole de Management, France. During his PhD, he worked with Pr Michel Montebello (IAE, Aix-en-Provence) on customer value creation strategies. His research interests are in the eld of creating customer value through the management of market-based resources and proactive cannibalisation processes, mainly on mature markets. He previously has served al. In addition, he has consulted with a variety of as European Brand Manager at LOre companies at Board of Directors level, including Reed Exhibitions, Arcelor-Mittal, Paris al France CPD Division, etc., with a focus on improving Chamber of Commerce, LOre competitiveness of a branded-product portfolio. Laurent Tournois can be contacted at: laurent.tournois@grenoble-em.com

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