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LOreal Global Brand, Local Knowledge Case Solution

Solution Id Length Case Author Case Publisher
1337 305 Words (1 Pages) Rebecca M. Henderson, Ryan Johnson Harvard Business School : 311118
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L’Oreal, leading the beauty and skincare market with its sales building to €19.5 billion, has strived to offer quality, efficacy, and safety to every individual, through its customized product categories. It manages 23 global brands across 130 countries, with 38 factories and 66,600 employees (2010). Initially, L’Oreal’s sales were hindered by the elite image people associated with Parisian beauty products. However, with the acquisition of America’s Maybelline (1996), high quality/low price value brand, the perception was altered. After a huge overhaul, Maybelline sales grew by 93% till 2002. Acquisition of Jade (Germany) and Unisa (Chili) further helped broaden the mass-market image of L’Oreal. Further expansions including China’s ‘Mininurse’ and ‘Yue-Sai’, and an Indian manufacturing plant, manifested a growing L’Oreal in Asia.

Case Analysis for LOreal Global Brand, Local Knowledge

Cosmetics, the Body Shop, and Galderma Laboratories were L’Oreal’s major divisions, with cosmetics capturing 93% of the revenue (2010). Consumer, Luxury, Professional Products and Active Cosmetics are its main operational divisions, categorized by the target audience, use, etc. In 1998, L’Oreal took a new approach to making the brand global, by not just providing localized products but by making them roll out globally (e.g. Garnier for Men). Here, ‘Geocosmetics’ researched on products and beauty trends around the world befitting regional needs. L’Oreal soon developed a portfolio catering to all price points and distribution channels and the ‘Masstige’ category was formed to offer luxury at lower price points (e.g. L’Oreal Paris).

L’Oreal’s advertising expenditure was the third largest (2009): 75% going to television, followed by print and billboards, but now shifting to digital marketing. ‘Fame by Association’ was another tactic, whereby celebrities, events, and website personalities were used to endorse the brand.

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