Basic Marketing _ Video Analysis

Beauty products have a large market worldwide and any company venturing in that sector should also keep creating products in different, but similar markets such as hair or bathing products to retain competitive advantage. L’Oreal has been able to accomplish this as well as obtaining many subsidiaries that align with the company’s ethics and goals. L'Oréal is a French personal care company and is the world's largest cosmetics company and has developed activities in the field concentrating on hair color, skin care, sun protection, make-up, perfume, and hair care. Such diversity has provided the opportunity to analyze their target customers as well as any competition that they may be faced with. L’Oréal strategy is called universalization and encompasses the company’s needs to embrace and understand the differences while providing tailor made beauty (L’Oréal Luxe Wins Over Millennials, 2018). While the strategy is admirable, there were some ethics concerns that the company had to overcome and change to ensure profitability.

Target Customers

The company’s target market of the product is defined as the market in which company would like to sell its products to targeted customers. L’Oréal utilizes demographic segmentation to target its customers which segregates the customers based on several factors such as age, skin color, and its social economic class. L’Oréal has been able to create brands for upper middle and upper class staying true to the men’s or women’s identification of beauty. They have also created products that cater to people of color as well as professional grade products for makeup artists. Some current changes were made to overcome the animal testing scandal and the reason the changes were made was due to a March 2013 a cut-off date. The company now claims not to test its finished products or raw materials on animals after this date (Rose, 2019). Such changes were implemented to keep with the current global times and to brand themselves as the most ethical. The company has established 34 brands to cater to its many customers. L’Oréal Luxe

What Do The Target Customers Want?

The target audience for L’Oréal Luxe expect service or products to be in line with their lifestyle as well as a personalized experience. The L’Oréal Luxe brands are better connected to their consumers than ever and are using digital technology to invent new relationships with them. Services now include video make-up tutorials by Giorgio Armani and the Vice Lipstick app by Urban Decay, which enables consumers to try about a hundred shades of lipstick before buying. Meanwhile, unique experiences, like launch parties filmed and shared on social media, embody the brands’ DNA (L’Oréal Luxe Wins Over Millennials, 2018). L’Oréal does have brand that caters to luxury and has many luxurious products. They create products for many individuals such as men and have developed men geared products; however, the mid-tier products such as Garnier remains a top earner for the company. L’Oréal is able to maintain low prices on such brand while advertising luxury from their other products in order to appeal to different facets of its consumers which ends up working well because working-class women tend to spend money frugally and not so much on luxury items; therefore, the pricing is a huge factor that makes L’Oréal’s products appealing to all the shoppers worldwide.

What Other Products, Companies or Disruptive Technology Is It Competing With

The competition which it is currently facing is against Softsheen and Maybelline New York. These competitors have a very loyal customer base in the cosmetic market which affects sales as well as having the market shared since consumers have many choices when making a purchase. Cosmetic brands need to innovate constantly in order to compete with other brands as well as retain the competitive advantage once competitors create products that could be better than L’Oréal’s. Research & Development is very important tool that all companies need to develop in order to compete with the competitor’s new products. Such a division allows the company to analyze its current products in comparison to its competitors’ products and allows for solutions to be obtained as well as new products.

Does The Company Have A Customer Focused Culture

The company has fostered its ethical branding and has become customer oriented by making significant investments in R&D to ensure that the products are innovative and chemical free which allows the customer to be protected from any skin reaction that arises from a customer utilizing a competitors product that uses harsh chemicals. L’Oréal products do not harm the environment either and has allowed L'Oréal which expands the fundamentals of strong ethical principles to further develop and continue to build its reputation. The bases of the reputation are that the company uphold honesty, respect, bravery and transparency. One way to take the company further would be to shift some of its focus on employees because L’Oréal company has been considered as company who is more focus on making customer relationship and ignore employees which are just as important as its products.

Conclusion

L’Oréal has made a conscientious effort to diversify its products and cater to its loyal customer brands. The company has been able to identify its audience and potential customers and develop brands to cater to that demographic. Being able to identify problem areas and develop new products to gain new customers has allowed the company to thrive since the creation of the company in the early nineteen hundreds and should be utilized as a success story for others to follow as well.

References

L'Oreal Luxe Wins Over Millenials. (September 2018). Retrieved September 2018, from L'Oreal: https://www.loreal-finance.com/en/annual-report-2018/loreal-luxe-3-3/luxury-wins-millennials-3-3-4/ How L'Oreal is Misleading Customers About Being Cruelty-Free. (Rose, 2019). Retrieved April 2019, from Cruelty Free Kitty: https://www.census.gov/foreign-trade/statistics/state/data/ca.html