l’oreal – building a global cosmetic brand
DESCRIPTION
Based on case on L'Oreal. Case accessable at http://www.managementparadise.com/forums/archive/index.php/t-23484.htmlTRANSCRIPT
Raghunath Ganti
L’Oreal Brand Management Strategy
“Hitting the right audience with the right product”
• Regular new products, new markets, new Brands• High R&D
“Diversity is a Priority” – French Company to United Nations of beauty• Multiple Brands of different origins • Brand repackaging and selling• Maintain Local culture• Local Leadership – multiple creative
Clear Brand Positioning
• Precise positioning and segmenting with little overlaps
L'Oreal Case - Brand Management - Sec A2
L’Oreal’s Brand Essence
• Quality• Elegance, Sophistication• Status Symbol• Stylish
Brand Attributes
Brand Benefits
Brand Positioning
Brand Personality
Value Proposition
Brand Vision and Objectives
Brand Essence
We want people everywhere to have easy access to our products through a presence in outlets that match their individual lifestyles.
• Constantly innovate to give best products• Provide value to all stakeholders
• Enhances self image – ‘I am worth it’
• Live the ‘beautiful life’ you dream of
• World’s number one brand
• Young,• optimistic, • Informal,• Feminine
• Break the norms,
• Freedom
• Follow the culture you want to
• Global Luxury Brand Name
L'Oreal Case - Brand Management - Sec A3
• Trustworthy• Elegant• Caring• Luxurious
Maintains Profits –Major Success Factors
Strong Leadership
• Taking the path few choose• Inter Brand Rivalry• Freedom to innovate
Consumer Understanding
• Offered something different• Differentiation in an undifferentiated market
• Emotional attachment and great communication
Offering Wide Range
• Ensured that company never faced an downward phase – something would always work
• Address major segments yet not cannibalize• Consumers had the power to CHOOSE and be what they want to be
Staying ahead• Huge R&D – always innovating – leadership support• Offering the ‘in thing’ – neutraceuticals and now “ The Body Shop”• Being aggressive – Promotion, Bargains
L'Oreal Case - Brand Management - Sec A4
Profits Through Brands
Analyze indicators
Analyze success factors and risks in the brand value creation process
Strategic planning
Coordinate brand management targets with corporate Strategy
Operational planning
Focus brand identity, define and prioritise operational levers for target achievement
Compare brand targets/Implem
entation
Consistent brand presentation through alignment of marketing activities with the brand targets
Steering and controlling
Transparent monitoring of Implementation success to Increase reaction speed and focus on the result
Unpredictable - Trend dependent,
Pull Based
- Brand target in-line with corporate targets
- New Brands Acquired giving huge profits
Inter Brand Competition encouraged to improve at all levels
All Brands in all markets, one Brand focused on based on local culture
Top management clear about goals and implementing the same
Create and Maintain Brand Profits…Adapted from www.markenscorecard.com
- Market leader – 16.8% share; - double digit profits for 18 conse. yrs;
- only company present in all 4 segments;- operations in 130 countries;
L'Oreal Case - Brand Management - Sec A5
What and Why of Maybelline
• Diversify away from Europe to become a globally recognized Brand
• Make the brands embody their country of origin
• Acquired an US based Brand, complete makeover and target new consumer segment and retain American Image
• Brand did not have a strong image so rebranding exercise needed to a success, else • Company’s diversifying strategy could have been badly hit
Objective of acquiring
Intent post acquiring
Maybelline
What Could have gone
wrong
Success Factors
• All aspects addressed – Location, Target audience, Attributes,• Innovation done to come up with better products• Expanded it internationally immediately to leverage the gains made
L'Oreal Case - Brand Management - Sec A6
Existing Brand vs New Brand
Merits
• Complete control over the Brand – Building to
maintaining
• Can develop it meets some specific future needs of
consumers
• Huge investments
• Success not guaranteed
• Timeframe long – Returns take time
Demerits
Creating
a New
Brand
L'Oreal Case - Brand Management - Sec A7
Merits
• Ready Market – Consumer Base.
• Allows breaking into a new market, consumer segment.
• Can be used as aggressive or defensive strategy
• Success can be estimated in advance
• Altering brand image - difficult
• Possible need for immediate investment
• Possible impact on base Brand
Demerits
Existing Brand vs New Brand
Acquirin
g a
existing
Brand
L'Oreal Case - Brand Management - Sec A8
L’Oreal’s Portfolio Management“It is a very carefully crafted portfolio. Each brand is positioned on a very precise segment, which overlaps as little as possible with the others."
What They Do
• Acquiring local brands around the world
• Retain local cultural aspects of the brand and make them major Brands
• Narrow target of customers• Developing emotional attachments with consumers
• Offer all Brands, promote one Brand
L'Oreal Case - Brand Management - Sec A9
Why it succeeds
• Little overlap between Brands• Ensures no cannibalization – future enhanced
by inter brand competition
• Freedom for Brands to innovate and develop new products
• Entire spectrum of consumers and products addressed
Thank you…
L'Oreal Case - Brand Management - Sec A10