L’oreal is the world’s biggest cosmetics and beauty products company. Basically it’s a French based company and its headquartered in Paris. It is focusly engaged in the field of production and marketing of concentrating on hair colours, skin care, perfumes and fragrances, make up and styling products. L’oreal products also based on dermatological and pharmaceutical fields. Their products are made for Individual and professional customers. This company operates over 130 countries like Asia, America, East and West Europe through 25 international brands.
This company started with the 3 employed persons but now research team exist nearly 2000 persons. L’oreal started its business in the hair color but in short time company also jumped into the cleansing and beauty products. The company has five research and development centre throughout the world.
L’oreal mostly emphasis to built strong consumer relationship so the company’s lifestyle and philosphy to provide more satisfaction to the consumer with the l’oreal products. So, The slogan of company is “Because we’re worth it”. They also produce products for the kids known with the name of L’oreal kids.
30.8% ownership by Bettencourt Family.
29.6% by Nestle.
3.2% by treasury shares.
Rest of 36.4% by public traded.
The primary strength of the company is always keep doing the new research and innovations in the beauty so that’s why l’oreal always gives best to the customers. Even in the competition market also because of the researching strategy they are the leader in the beauty and cosmetics field.
Other strength of the L’oreal is that they set more attention in their particular acts and activities. Their acts and activities are going to separate in the five groups. These groups includes First is the Consumer product division in which all their range distributed through massive markets. L’oreal’s products and quality available to maximum customers or consumers and their luxury international brand product division available through perfumeries, departmental and duty free shops. Their professional hair care products used by the professional hair dressers and also sold to the customers through salons. These divisions and sub-division maintains the quality of L’oreal group.
The other enumerated strength of the company is L’oreal advertising strategy it also play very vital role towards the company’s growth. In the course of achieving the culture of their target market advertisement is the best way.
The biggest weakness which a company always facing is that its decentralized organizational structure. This problem is also faced by the L’oreal. Because of the many subdivisions of this company it is not easy to operate and control of L’oreal. So, because of this the production of company getting slow down.
Other weakness which the company faces that it that their profits. The margin between their cost price and selling price is comparatively low than their other smaller competitors. So, the profit does not match with their expectations. This is also happen because of large scale advertising and marketing. Lastly, due to its multinational marketing strategy, even there’s also some diffrences occurred in the promotion and campaign of L’oreal products as to what image they are to be project.
The l’oreal company focuses on the beauty and cosmetics products for the women of all the ages. The regular demand for beauty products gives opportunity to the company to keep their focus in their specialized field, specially on the hair stying and color, perfumieries, cosmetics and skin cares. Exist as the leading brand in their field the company has well known image in the world. Even in the developing countries also. Another opportunity for the company is that taken from their greater market share due to the numbers of patents registered by the company.
The basic threat to the company is facing competition within the field of cosmetics brands. Because of the keeping going addition in the products, there’s the danger that some other brand may take the profit of L’oreal.
Other threat to the company is different economy. Because most of the products are only within the reach of the people of developed countries but some how L’oreal solve this problem they make products for the people of under-developed countries also. Thus the L’oreal company produce the product of best of it line even people may tell that their products are not upto their basic needs and would reject to buy the L’oreal product.
Each and every company must follow some strategy for their existence and growth in the business. So, that’s why L’oreal also follows the Pest analysis because they believe that it may have some impact on the company’s present and future.
Political factor always make effects the business specially during the period of elections. Every government make different strategies and rules regulations so it really makes effects the business because it is not easy to adapt that changes for the whole business so that’s why even sometimes company have to bear the great loss.
The economy measures the strength of the policy to support the business cycle and specially in the period of recession. In terms of economic growth it is necessary to create business environment more attractive in which business can be fully establish and grow.
Taxation law always effects to the way business is conducted.
The today’s young social factor is quiet diverse. To being in the market every business needs to examine customers demand, their buying pattern and must be innovative. People wants to be more socially aware and concerned about environmental and ethical issues. Females are particularly influenced by social issues as environment or community related.
Customers are very conscious about their image. They have different opinions so they will look for different brands that really suits their personality and also reflects current fashion. The society is more complex and diverse therefore the people likely to adapt diversity in their life.
These days usually companies compete at global level so that’s why rapid development comes in the technology.
It is an ability of an organization to adapt and use latest technological advanced software’s for the sake of security as this security can reduce the different illegal working behaviour such as fraud, shop lifting, misconduct and so on.
5. Aims And Objectives
To provide best quality product to the consumers.
To be friendly and helpful towards customer and staff also.
Treat everyone equal so that’s why their products available in every range.
6. Company marketing Strategies
The L’oreal group is known for their regular improvement in their quality of their product and services which they provide to their customers. Their products are stylish and according to the latest fashion trends. Though provide a wide variety so their products are available in reasonable range to luxurious too. So, they always give customer satisfaction.
L’oreal is famous throughout the world for setting the fashion trend. So, the price of their products are also caters according to the demand and budget of the customers from young to the aged ones.
7. Control of the Company
The success of company depends upon their leaders or staff that how they run and handle the business. The company L’oreal is very conscious about the governance of company. Their directors and members are very perfect in their jobs because they know very well that the future of the company is in their hands. So, they are well aware of their responsibilities and act according to the demand.
8. Worldwide Marketing
8.1 Place of promotion
The L’oreal group planned strategy to do marketing in the worldwide. So, at their primary stage they did the research and understand the demand of their customers and this strategy help the company to formulate products that suits the customers thoroughout the world. Through their research and development L’oreal mostly covers all the parts of the world and still got highest rating from customers.
8.2 Promotion Strategy
Advertising is the best way to increase the sales of the products and also helps specially to promote the new product and keep that in the mind of public. So, L’oreal also follows this strategy through print media and multimedia So, L’oreal uses the actors of different ages and personality for their promotion.
I would suggest L’oreal should follows the decentralised strategy so the complexity in their business decreases.
L’oreal should use better visual display in the stores to look product more fashionable.
10. Implementation plans
L’oreal group contribute to the community at such worthy cause as “For women in science” and educational opportunity they have done partnership with UNESCO in 1998, this programme promotes the role of women in scientific field and also encourage the young women throughout the world to come and join this stream.
In evey country government apply the rules for the cosmetics companies to write the ingredients which they used in their product so before buying the product customers knows everything about that. L’oreal is very careful about their ingredients and very particularly while select the ingredients. So, the company hired the well qualified and trained scientists and they use natural and synthetic substances and conscious for the formulation of product, its functions, use and concentration, absorbed in skin, its purity and stability. Company ensures that their product whether it consist with natural or synthetic substances it is equally safe to use.
11. Target Market
L’oreal has rapid growth in his business and keep focus on the new target market. It is leader in fast fashion world and quickly turned according to the demand of the customers ant their traditional strategy to existing leader market. Since 1990 their sales always double every year. To attract new market and also hold the established customers they always come with something new and different. They also target on their little competitor because some how these little companies effects their business they want to take over that companies.
L’oreal is a well known brand around the world
and easy to get it across the world. It sets the fashion trend.
With the passage of time they increases its strength and reduces the weaknesses.
The company very much emphasis on the advertisements to keep its name in the public.