Global Brand Local Knowledge

1. CONSUMER BEHAVIOR | SYNDICATE 13
LUPITA THANAYA - 29114322
ANNISA MULIASARI - 29114342
MELATI P. PUTRI - 29114355
DEA ANANDYA - 29114469
CASE ANALYSIS
GLOBAL BRAND,
LOCAL KNOWLEDGE

2. Founded in 1909,
L'Oreal coupled
innovation and
speed to market
with expansion of
its geographic and
consumer base.

3. Leading player in the beauty and
skin-care market.
€19.5 billion of 2010 sales
(half outside of Europe)
“Launching new innovative
products on a regular basis
was key”
“Science of beauty in a jar”
3,5%
2,7%
1,7%
% of Revenue on R&D in 2010

4. 1907
EUGENE SCHUELLER
Developed Aureole, a
hair-color formula.
Formulated and
manufactured his own hair-
dye product, sell to Parisian
hairdresser.
1957
FRANCOIS DALLE
Initiating the concept of
selling beauty through
several channels. Perception
of “Parisian beauty as being
expensive and out of reach”
1988
LINDSAY OWEN-JONES
Focused on 5 core business
(hair color & care, skin care,
cosmetics, and fragrances).
“The firm had to
promote its national
brands to the rest of the
world.”

5. What is L’Oreal doing?
How are they executing this
strategy?
What are the trade-off of this
strategy?

6. 66.000
employees
130
countries
130
countries
38
factories
5.7 billion
units
hair-coloring hair-styling fragrances
cosmetics skincare

7. department stores
retail stores
duty-free stores
internet
Direct marketing
to professional

9. acquisition
add more
1966 USA
CHILE
GERMAN
U N I S A
J A D E
2000
CHINA
USA
CHINA
2003
2004
1999
Men Product
Top skin-care brand in China
Makeup and skin-care brand
manufacturing plant
Pune, India
Secured L’Oreal’s Asia presence
Ethnic hair-care marketers

10. LOCAL CUSTOMER UNDERSTANDING

13. GEOCOSMETICS
created to understand consumers at local level
Study the beauty trends around the world and deliver the best product for that region.
“People on different
continents have their
own specific needs,
habits, dreams, and
desires – so one
product, or even one
formula, does not fit all”

14. “L'Oreal developed brands in the low-, mid-, and
high-ends which every brand has their own
brand policy.”

15. MASSTIGE
“Prestige for the masses”
Luxury or premium
products
Price points that filled
the gap between mid-
market and super-
premium products

16. Maybelline had lost focus, losing brand equity,
struggle to keep up with the rest of the market.
L'Oreal acquired Maybelline
in 1996 for $768 million

17. “Maybe she’s born with it
Maybe it’s Maybelline”
MARKETING STRATEGY
Improving products (Fast-dry Nail)
Moving the headquarter to New York
Boosted ad spending by 30% to $70 million
Brought back Maybelline’s slogan

18. Modernize the
advertisement
Video of
Christy Turlington

19. 70
Was in
Countries by 1991
93%
Sales grew
From 1996 to 2002

20. REGIONALLY FOCUSED ROLLOUT
“2008; A key focus of his group would be to accelerate the geographic rollout of its brand in
new high-growth markets by tailoring product performance and price to local needs.”
– L’Oreal’s President of Consumer Products.
L’Oreal did not use the
direct-sales approach 
hired personal beauty
advisers at Department
Stores
“The more the
market develops,
the less relevant
direct sales will be.”
L’Oreal Invested in :
1. Strong Ad Campaign
on the internet
2. Women’s magazines 
drive word of mouth
3. Have consumers generate
demand for salons’ products
Redken (1990s) :
Innovated a different
kind of marketing
approach.
A highly successful
American Premium
brand.

21. TELLING THE STORY

22. Diverse Customer Base
 Aging population in the West
 Ethnic groups
 Aspiring customers in the East
 Emerging Markets
 Growing interest in health &
beauty care among Men all
over the world.
Managing Transition
 Swelled $4.56 Billion in
worldwide advertising
spending in 2009
0
2
4
6
8
10
12
L'Oreal P&G Unilever
2005
2006
2007
2008
2009
Total Global Ad Spending (in $ Millions)
– Based on Exhibit 5

23. Company’s Ad Budget :
 75% for Television
 20% for Print
 5% for Billboards
2007, Company spend 2% of its ad
budget on Online Initiatives
2010, L’Oreal resumed investments
after focusing on cost cutting
L’Oreal aimed to attract a
bigger customer base in US &
Emerging Markets
L’Oreal was one of China’s largest
& fastest growing advertisers.
Spent > 10% of its 2009 media
spend in China.
75,4
132,5
196,5
333,3
576,8
0
100
200
300
400
500
600
700
2005 2006 2007 2008 2009
Total Ad Spending in China (in $ Millions)
– Based on Exhibit 6

24. Fame by Association
“L’Oreal used A-list Celebrity
endorsers in highly successful
ad campaigns to push products
to a wide range of age
brackets, ethnicities, and
genders.”
ENDORSEMENTS
Sarah Jessica Parker – Garnier Nutrisse
Eva Longoria, Diane Keaton, Scarlett
Johansson, Beyonce Knowles
Kate Moss – YSL Parisienne
Patrick Dempsey & Gerard Butler – the face of
L’Oreal Paris Men’s Expert Line
The Cannes Film Festival – L’Oreal Makeup
“L’Oreal associates itself with
brand ambassadors who tap into
all ages, race, and sexes, and the
portfolio leaves no stone
unturned.”
2011, L’Oreal launched a
Cannes-inspired line of
makeup, L’Or.

25. Fame by Association

26. Fame by Association

27. The challenge in 2010 was for
student teams to come up with a
beauty-product range for men’s
brand Diesel.
In 2011, the challenge involved
designing a new advertising
concept to attract men to
professional salons.
L’Oreal Brandstorm
43.000 students 285 universities 43 countries
Marketing as Recruiting:

28. from print TO DIGITAL
“The big revolution is digital, and it is a great revolution.
Because it changed completely the way we communicate
about our brand.”

29. Garnier Fructis launched a user-generated website that had
the ability for the users to upload their own samples of how
they styled their hairusing Garnier Fructis products.
User-Generated Website

30. Digital Marketing Innovation: Virtual Personal Stylist

31. The Facebook pages included
a customizable tab that
displayed products and how-
to videos
L’oreal
Grassroot
Campaign
Help more than
4000 salons build
Facebook pages
for business
L’Oreal offered instructional
videos, and training and
advertising credits to the
salons

32. L’Oreal Destination Beauty
Contained how-to videos filmed by
Beauty Bloggers who provided hair
and makeup tips.
Destination Beauty allowed L’Oreal
to engage viewers at home and
establish sense of community.
Used established web personality to pitch
product, like Michelle Phan

33. Double it’s customers base to 2 billion people, and increase it’s shares
of sales from emerging markets from 30% to 50% during that time
Year 2020
“Reaching the Next Billion Customers”

34. thank
you!