L'oréal: more than a success story, an empire.

Elaloui Inès

Sadeq Célina

TD 3103

L’Oréal: more than a success story, an empire

« Because you’re worth it »: everyone knows this slogan, it is that of the international brand L’Oréal, located in Paris. The company started with a new development of a hair dye in 1909 by a young chemist Eugene Schueller and is now headed by Jean Paul Agon, the current CEO.

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Since then, L’Oréal has become a real empire in the world of cosmetics and beauty and helps millions of people feel pampered and beautiful each day. For that, this group is present in over 130 countries with 28 global brands like Lancôme or Maybelline.

The company manufactures cosmetic products like hair care products, skin care products, make-up, or perfumes. L’Oréal currently manufactures 500 brands and thousands of individual products in all sectors of beauty and fragrances.

It has become an international brand while retaining its roots because throughout the world L’Oréal embodies the concept of French beauty.

Otherwise, L’Oréal group’s international success represents an international marketing model based on skill, knowledge, an unshakeable reputation and an intimate relationship with customers. Indeed, the slogan of L’Oréal, “Because You’re worth it” has created a huge impact on its consumers by boosting the consumers’ sense of self-worth and self-respect. But we can also add that one of their best success is their concept of diversity at all levels that permits to accomplish their mission: beauty for all.

How has the group managed to establish itself as a leader in cosmetics and beauty in the world?

Firstly, we will tell you the story of a French brand that became international, then we will focus on the other aspect of the L'Oréal group: its social and environmental commitment.

1. The evolution of L'Oréal through time

•A French company that has become international

In 1910, through his determination, Eugene Schueller convinced Paris hair stylists to use his dyes. He also sets up a hair-coloring school on Rue du Louvre in Paris.

Afterwards, in the 1920’s and 1930’s, with the war finally over, a new age begins. Around the world, women are working, earning money, more concerned about their appearance. In order to encourage women to focus more on care products, Eugene Schueller publishes Votre Beauté, the first monthly women’s health & beauty magazine.

However, international development doesn’t mean abandoning French territory, that’s why the L’Oréal group ensures longevity on one part of their production in France. On the cosmetics market, the “made in France” label is a gage of quality and a real added value across the world.

Internationalisation is at the heart of L’Oréal’s development strategy. In fact, since 1970, international activities have taken an increasingly central role in the group.

In recognition of its spectacular development, the L’Oréal Group is listed on the Paris Stock Exchange which gives it access to new financial resources. The Group’s market capitalisation has increased more than 750 times since 1967.

The 1950’s and 1960’s would take L’Oréal in new directions: In 1954, L’Oréal decided to tackle the largest cosmetics market in the world: The United States and in 1966 the group launched in Brazil and created PROCOSA (Productos Cosméticos SA) in response to the exponential growth of the Latin-American market.

With 50 products sold every second worldwide, L'Oréal Paris offers from all continents male and female beauty products of all types (makeup, skin care, hair care etc.). L'Oréal Paris shares a unique vision of beauty, supported by 35 diverse international ambassadors, icons such as Jennifer Lopez, Beyoncé, Freida Pinto, Jane Fonda or Eva Longoria.

•The keys of L’Oréal’s success

According to Beatrice Collin and Daniel Rouach, authors of “L’Oréal’s model: the key strategies of a French multinational company,” L’Oréal’s internationalisation strategy is based on key ideas:

• Investments in all countries to diversify risks
• Innovation is essential because it expressed a constant pursuit of perfection and beauty is an endless quest.
• Maintain efforts in the European and American markets where there is already potential to grow
• The unique and immense distribution strategy because L’Oréal groups have developed a unique position in the way that they are present across all markets in the industry. In addition, the group is even becoming its own distributor thanks to shops like the Body Shop and via online shopping.
• The L’Oréal group managed to adapt to specific cultural differences in the beauty market. The CEO said: “For a Brazilian woman, hair and body are most important, for a Chinese woman facial skin is the priority, for an Indian woman it’s make-up. Our approach is the ‘universalisation’ of beauty, it means the globalisation without standardization».

Even if it has well-established strategies, L’Oréal has principles and core values that are Integrity, Respect, Courage and Transparency.

1. L’Oréal: a committed brand

•The L’Oréal Foundation and its social fights.

L’Oréal has always been very concerned about corporate social responsibility and has conducted many activities related to that. One of which is L’Oréal-UNESCO Awards for women in Science, which focuses to recognize women researchers and their contribution in scientific progress. L’Oréal has six worldwide research and development centres in France, U.S, Japan, China and India.

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