Loreal Essay

1368 Words6 Pages
Final Case Study L’Oréal 1. Review L’Oréal’s brand portfolio. What role have target marketing, smart acquisitions, and R&D played in growing those brands? When look at L’Oreal’s brand portfolio, we can see that today L’Oréal focuses on its five areas of expertise included skin care, hair care, makeup, hair coloring, and perfume. Its brands fall into four different groups: (1) Consumer Products (52 percent of L’Oréal’s portfolio, including mass-marketed Maybelline and high-technology products sold at competitive prices through mass-market retailing chains), (2) Luxury Products (prestigious brands like Ralph Lauren perfume offered only in premium stores, department stores, or specialty stores), (3) Professional Products (brands such as Redken designed specifically for professional hair salons), and (4) Active (dermo-cosmetic products sold at pharmacies). L’Oréal was able to use precise target marketing by hitting the right audience with the right product at the right places. It has been a very crucial key to L’Oréal’s global success. The company has built its portfolio primarily by purchasing local beauty companies all over the world, revamping them with strategic direction, and expanding the brand into new areas through its powerful marketing arm. For example, L’Oréal instantly became a player (with 20 percent market share) in the growing ethnic hair care industry when it purchased and merged the U.S. companies Soft Sheen Products in 1998 and Carson Products in 2000. L’Oréal believed the competition had overlooked this category because it was previously fragmented and misunderstood. Soft Sheen-Carson now derives approximately 30 percent of its annual revenues from South Africa. L’Oréal also invests money and time in innovating at 14 research centers around the world, spending 3 percent of annual sales on R&D, more than one percentage point above the industry

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