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I use the most expensive Hair colour in the world It’s not that I care about money It’s

that I care about my hair It’s not just the colour , I expect great colour What’s worth more to me Is the way my hair feels Smooth and silky but with body Feels good against my neck Actually I don’t mind spending more for L’oreal BECAUSE I ’ m WORTH IT


etics group worldwide

rnational brands

lion euros of sale in 2009

e across 130 countries Western Europe & North America accounting for 43.3% & 23.4% of total KEY MARKETS: Asia accounts for 13.2% consolidated sales of total





in the black hair care industry , was founded in 1964 and acquired in 1998 Products, another successful manufacturer of ethnic hair and skin care rged in that year to become SoftSheen - Carson

Overview of the black hair care market Johnson products was the largest in black business & the first 1960-1970 one To be traded on the American Stock Exchange. Johnson was closely followed by Soft sheen and Pro- market had approached 1980 Black skin & hair careline $1 billion $2 1994 Black hair care market approached Only 1.5% of the black disposable income was s billion ,

Huge market potential & the to the hair care market in th 12.3% of the nation’s population & contributed 34% need for growth & diversific

1998 Carson Inc. acquired Johnson products from IVAX co. for $90 million With its “Dark & Lovely” black hair products , Carson became the market leader in black hair-care products 2000 Carson could not survive the debt incurred by the purchase of Johnson products & Was sold out to L’oreal for $250 million & merged with “softsheen” L ’ oreal brandgained control over 3 of the top 5 selling hair care now brands & 62 % of the African - American hair market SoftSheen·Carson confirmed its position 2009 as No. 1 in the ethnic hair care products market, with new initiatives in three major categories üupgraded the Dark and üLaunch of ammonia-free Lovely range with a more Dark and Lovely Colour moisturising formula, Confidence Haircolor richer in shea butter than the other hair relaxers on the market üDiversified into the skincare market in South Africa with Dark and Lovely Body. A line of body milks enriched with vitamin E and glycerine, which provide longlasting hydration Source : Constructing corporate America : history , politics , culture  By Kenneth Lipartito, David B. Sicilia


•Japanese women have small mouths & the concept of “mother of pearl” is very popular there •This particular molecule created the effect of water giving the lipstick a wet look

L’oreal caterd to this segment with atershine Diamonds”

as the market leader in the mass-makeup market in Japan

also launched the same product in US & Europe where it enjoyed a similar meteor

Source : The new strategic brand management : creating and sustaining brand equity

In 1996, L’Oréalbought the American make-up brand Maybelline, decided to promote it to a global makeup brand & as a consequence to substitute it to the local make-up brands, as Gemey in France

dered to be “a brand specialised in the different types of make-up targeting Fren VAST DISPARITY IN POSITIONING

Maybelline was defined as “an in-brand of make-up from New York, target

rogression of the Gemey – Maybelline visual identity






ine New York #1 in make-up in the USA” both on the packaging and in communication

Gemey and Maybelline have of skyscrapers to offer you better technology Integration come together into the began in the second half of 2000 background of advertisements and sales outlet visuals, sponsor slogans

Value Curves and Value Proposition

The Body Shop - Illustrative Example

— The Body Shop made clear decisions regarding: – What factors could be reduced below the industry standard? – What factors could be eliminated that the industry had taken for granted? – What factors should be raised beyond the industry standard? – What factors should be created that the industry had never offered? — In so doing, The Body Shop created a unique business model, brand and position that ensured an sustainable competitive advantage

The Body Shop


Cosmetic’s Industry

— The Body Shop’s robust business model and unassailable position was evidenced by L’Oreal’s acquisition of it in 2006
Packaging & Advertising Hi-Tech Scientific Image Glamorous Image Natural Ingredients "Ethical" Concerns



— Despite being an established, extremely wellresourced competitor L’Oreal had been unable to compete against The Body Shop’s values and positioning…..whether The Body Shop’s values were compromised by its acquisition, however, is a different matter! —

EVOLUTION Greasy & Reason for being Dress the tough rocksolid guys

Quirky urban Conscious Make people feel Help people fashonistas hedonism different & carry a more provocative pleasant Value proposition Stylish jeans & Affordable fashion Fun , experience workwear with a urban street wear imaginative & used worn out look colourful Differentiation Worn out look Urban street wear Happy & fashion colourful Persona Tough , wild , Extravagant , Witty , culture clothing adventurous critical conscious Associations Rebels , women , Political issues , Youth , cigarettes , gas religion , vitality , stations , leather sexuality , fashion happiness Product range Jeans & workwear Jeans , clothing , Jeans , shoes , fragrances clothing , sunglasses , watches , Audience Tough guys Intelligent urban Hipsters shoes , bags , wannabes fashionistas Emotional connectPal that gives Uncommonness - fragrances Ego & mood advice to be tough to make your life booster




dd the brave” charectizes their “how to” guides motivation for & unexplainable first era y messages life mselves by selling jeans that& non models in the same picture they decide to change their strategy and agazines they using models looked worn are really smart and s exemplified realize that their consumers o rememberwith holes on them creating a “mismatch buzz” ashed and their campaigns by perception related to defective jeans on shelves hanged to tight fitting jeans & mohawk logo in Argentina since many people during the dictatorship w hed at their feet” which was very controversial 2 gay sailors kissing ohawk logo soon became a hit


dy shop opened at a small street in brighton y about a dozen inexpensive ‘natural’ cosmetics, all herbal creams and shampoos, a 1976

anyone not have the freedom on the quantity they buy? Differentiated business mind , body shop offers customers only the required amount of cosmetics specified model natural products , against testing on animals

could easily be copied by competitors e with founders for rapid expansion of brand Developed the idea of franchising

as granted exclusive rights as user of the trade mark, distributor and, after an i


All Key advantage of franchising market knowledge thus minimizing loss of r “Body shop” built upon local

gets listed on the stock market while still maintaining the franchisee model 1984

•Own warehousing & distribution network wherein products were delivered Key •Started manufacturing with the trade not aid policy strategies followed

shop gained popularity worldwide mainly due to its sustainable development progra

ties in developing countries ingredients and accessories from disadvantaged socia sourcing so that they can sustainably finance their own comm



Body shop contribution to l’oreal ü Naturally oriented natural cosmetics with strong identity & values ü Distribution expertise and access to direct producer channels ü A leading british

L’oreal contribution to the body shop ü Access to R&D practices , improved product development for body shop ü Leverage L'Oreal's marketing expertise while respecting body shop identity

Established 2004 , a joint venture between L'Oreal & Nestle

Diversification into the market of cosmetic nutritional supplements
This brand marked the launch of “nutraceutical development” Key strategy •Capture growing demand for skin products to retain youthfulness •Tap the growing market for dietary supplements

d hair loss, as well as a product that claims to help protect the skin against UV

2004 also saw new haircare developments: by launching Innéov Hair Mass, a product aimed at a wide range of women affected by low hair mass The innovative feature of the product is the taurine-based formulation, which specifically targets the bulb where the hair is made to produce clinically-

The market for nutricosmetics was practically empty & unexplored Except for a few competitors like “IMDEEN”

elevance in the associations and skills the two brands bring to the alliance BRAND FIT

Nestlé’s reputation as leading and competent nutrition brand is highly relevant when making a diet supplement. L’Oréal image as a beauty expert is just as relevant when making a diet supplement meant to improving the quality of your skin and hair

L’OREAL USA purchased Kiehl’s in 2000 as a part of a carefully planned acquisition strategy The US buildup was critical to the globalization of its business

By adding brands such as redken , maybelline , kiehl’s , softsheen-carson , L’oreal had created an international brand portfolio with wide range of incomes & tastes in 140 countries rance & hair care products were renowned for their high quality , effectiveness &

omer base was loyal and young o advertising at all , onlyexpansion celebrities touting their products neighborhoo Little through , most business came from a singe

Unable to meet rising demand , sold itself to L'Oreal

Foray into INDIAN MARKET Skin care in India is the most sought after personal care categ global consumer majors given significant head room for growth (2 growing at 20% p.a.) with an estimated size of Rs25bn
With a GDP of 1.9 trillion $ & rising per capita incomes India offers a lot of market potential to tap

levels and favorable demographics (growing share of working women) are driving gro

L’oreal in india
Came to India in 1991 with its Ultra Doux range of shampoos through its agent Laboratories garnier 1994 – laboratories garnier becomes 100% subsidiary of l’oreal 2000 – l’oreal launches its range of products in the cosmetic market Biggest contributor to the Indian revenue GARNIER





USP : strong hair

Caters mainly to the natural segment ; beauty through nat

operates in the mid price & luxury segment Performance is mainly dyes market r garnered a 20% share in the hair colourant &attributed to being the first play

hair based colour below the price of Rs Home highlighting kit ( 2005 )

entrate in all their products (combination of fruit acids , vitamin B3 . B6 , fruct Technological breakthrough :

name “Laboratories Garnier” was changed to “Garnier” in 2001 to facilitate the br ptance in all the 5 continents it operates tagline " Take Care " can be used across multiple categories without

Shampoo market in India generally caters to men & women ; kids & teens category Is totally absent

•Garnier as a brand is slowly targeting COMPETITION: PARACHUTE the entire STARZ personal care market •Adopting a segment by segment targeting strategy ids care market is dominated by HUL's Clinic Plusconscious. So tapping players bein ir have a mind of their own and they are brand brand and the other them with a

FMCG companies have been increasingly focusing on catering to men’s grooming products Men’s fairness segment is currently estimated to be around Rs4.1bn and is growing ahead of overall skin care market in India ndustan Unilever in 2007 'Fair & Handsome' which still dominates the but the prod 2005 with the launch of launched 'MenzActive' in this sub-category, space with 6

Entry in the men ’ s fairness segment

long with fairness also catered to “face wash” and “moisturization” instead of jus

STRATEGY / DIFFERENTIA TION Diversification into 2 categories with a single brand extension