What are the various cornerstones of L'Oréal's strategy?

• Brand Integrity - The organization was broken down into four distinct divisions with each division
having a separate marketing team structured around the brand itself. These teams were responsible
for their own brand’s positioning thereby, ensuring brand integrity.
• Local consumer understanding – L’oreal believed that one formula does not fit every person and
thus, the brand needed to develop a brand adopted to local needs and wants. For this, they set up
regional marketing teams which could roll out local innovations whenever appropriate.
• Brand Diversity – L’oreal wanted to diversify it’s brands such that each brand would have a separate
image in the consumer’s mind. Therefore, they did not allow brands to be sold outside designated
channels. For example, L’oreal Paris was sold through retail outlets only.
• Selling Masstige Products – L’oreal introduced a new category of products which catered to both the
masses and the prestige class. They sold high-quality products at affordable prices , an example of
which is L’oreal Paris.
• Innovative Marketing - The company invested heavily in advertising having celebrity endorsers with
whom the local people could relate. They even moved from print to digital noticing the trend among
their target audience. They even had established web personalities pitch their products on the
internet.
 How is it executing this strategy?
• Omnipresence of the brands: L'Oréal acquired – Maybelline, it had also acquired the Chilean company Unisa, and the
German company Jade. In addition it had also acquired two ethnic hair care manufacturers – Soft sheen Products and
Carson Products co. which had a presence of more than 60 countries in the world. Its strength in China was secured
Mininurse in 2003 and Yue-sai in 2004. They also set up a new manufacturing unit in Pune. By doing so L'Oréal was able to
ensure its presence all over the world,
• Brand repositioning of acquired companies: When L'Oréal had acquired Maybelline it was losing its brand equity. They
had repositioned the brand having urban flair and efficient in order to address the issue of speedy results for young
working professionals.
• Regional Products and Marketing teams: Due to its omnipresence in the market, L'Oréal understood that with terms to
skin care local understanding of the customer was imperative to be successful. This helped determine the requirement of
the region and developed the concept of “GeoCosmetics” by developing labs to develop geo specific products. In 2003 it
setup Loreal Institute For Ethnic Hair and Skin Research in Chicago and opened a research centre in 2005 in Pudong China
where it developed more than 300 cosmetic and hair products for Chinese customers Eg: Garnier Men in India, Fructis
Stop Caida haircare In Mexico
• Brand Diversity - Catering to all segments: Due to the number of brands under its umbrella, L'Oréal was able to cater to
all segments ranging from low, mid to high level products varying from mass market retail channels to professional
services. Maybelline focused on younger, working segments and Garnier catered to men and women.
• Adaptive Marketing: They had a wide range of celebrities who were spokespersons for the brand including Sarah Jessica
Parker, Beyonce Knowles, Aishwarya Rai and they had mapped these to their respective brands. They also transitioned
from print to digital and developed engaging campaigns for Garnier fructis and personal virtual stylists.
 What are the tradeoffs?
• To attain a broader consumer base, L'Oréal did a trade off with its focus on
premium products and developed products in “Masstige” category which
is premium but attainable.
• Fight strong market incumbents: L'Oréal had largely missed out on
Brazillan women, who were top beauty spenders and usually bought from
door to door sales representatives. L'Oréal did not use direct sales
approach but it hired personal beauty advisors at departmental stores.
• L'Oréal started tapping into local markets by developing local innovations
and traded off with their general characteristic of being available limitedly.
• L'Oréal focused on heavy advertising, which was not its mainstream
culture, to cater infinite needs of different segment of people.
• It switched from traditional media and advertising like print, to digital
media using Internet.
How are competitors reacting to L'Oréal's marketing? Analyze
the marketing efforts with respect to imitation by competitors.
How should competitors react to your L'Oréal's marketing?
• L'Oréal has adopted digital medium for advertising, so have all other competitors in a
way to reach mass media and learn about various consumer preferences through
technologies like data analytics and target them.
• L'Oréal focused on a premium segment but later entered introduced products that were
premium but affordable tagged as “Masstige”.
• It was imitated by Revlon in terms of its tagline. L'Oréal tagged its products as “Science of
beauty in a Jar” while Revlon tagged its products as “Hope in a Jar”.
• L'Oréal also launched competitions such as Brandstorm to obtain and develop new
solutions. Such competitions are now also organized by other competitors.
• L'Oréal created campaigns associating themselves with public or adopted a storytelling
method to associate the public with their products. Dove also followed this suit with
their products.
What are the lessons learnt by other Consumer Packaged
Goods companies?
• Brand Diversity is key factor in enhancing the growth and success of a
company across nations. Portfolio must be designed specifically
considering price points and distribution channel.

• Acquisition is another way company can grow its profits. Like for example
, L'Oréal acquired Ralph Lauren, Kiehl , Maybelline etc.

• Appointing brand ambassadors across various ages, races and sexes.

Companies endorse their products through highly successful ad
campaigns featuring these A-list celebrities.

• Customizing market strategies as per the requirements of the market.

• Transition from print to digital media thereby expanding market reach

and product identification among more and more people. This helped
change the nature of interaction among customers and the company.