L'Oreal's Evolution into a Global Cosmetic Brand *

Abstract:

The case discusses in detail the brand management strategies of the global cosmetics industry leader, L'Orèal, over the years. L'Orèal's brand portfolio included brands from different cultural backgrounds like Europe, America and Asia. The case explores L'Orèal's expansion of its business through the acquisition, makeover and worldwide marketing of relatively unknown brands from different countries. In addition, the case takes a look at the way in which the company consciously worked towards straddling all the segments of the cosmetics business and building successful brands in each of these segments.

Issues: » The brand management strategies of a large cosmetics company with a global presence and a large portfolio of brands.

Questions for Discussion:

1. Critically comment on L'Oréal's global brand management strategies. Do you think L'Oréal's strategies were primarily responsible for its impressive financial performance? What other factors helped the company remain profitable since over two decades?
2. With specific reference to Maybelline, critically comment on Jones' strategy of acquiring relatively unknown brands of different cultural origins, giving them a makeover and marketing them globally. What are the merits and demerits of acquiring an existing brand vis-à-vis creating a new brand?
3. L'Oréal maintained a large portfolio of brands and was present in all the four segments of the cosmetics market. What positioning strategy did the company follow to ensure that the image of its brands did not overlap? How and why did L'Oréal encourage competition among its brands in a particular segment and at the same time prevent the brands from cannibalizing each other?

Key words:
Brand management strategies, global cosmetics, L'Orèal, portfolio, cultural backgrounds, Europe, America, Asia, acquisition, makeover, worldwide marketing, straddling, all, segments, cosmetics business, building successful brands, segments

*Note : This case is a simplified version of a longer case study, and is intended for learners for whom English is a foreign language. The longer version of this case study (MKTG062) is available at: http://www.icmrindia.org/casestudies/catalogue/Marketing/MKTG062.htm