L’Oreal Paris Strategic and Marketing Objectives

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Introduction

Rapidly developing economy and changing customers expectations demand constant modernization of production processes and marketing strategies. Personal care companies recently face challenges connected to the increasing demand for combining environmentally friendly technologies with high-quality goods. L’Oréal Paris attempted to achieve this objective by releasing Botanical Fresh Care, a new range of premium hair products which first rolled out in France, Germany, and the United Kingdom in 2017 before being released in the rest of Europe (Deslandes, 2017, para. 1). Botanicals Fresh Care products come in four versions: coriander, safflower, geranium, and camelina, and each scent family consists of shampoo, a mask, a conditioner, and a serum (Deslandes, 2017, para. 2). L’Oréal Paris Group itself is a French personal care company founded at the beginning of the 20th century. These days, it is one of the industry’s major players developing a variety of goods, including haircare, skincare, and makeup.

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This report aims to provide efficient marketing mix solutions to reach the company’s strategic and operational marketing objectives. The first section of the paper discusses the main environmental factors which influence the current production and advertising solutions employed by L’Oreal Paris. The second part provides the target market analysis. In the third section, considering the limitations of the existing strategies, the report introduces several improvements that can help the brand attract new customers and increase its revenue. It is suggested that L’Oreal Paris should concentrate more on advertising its products on popular social media platforms attracting attention by engaging successful influencers. It can also be beneficial to improve customer service by providing better individual assistance, discounts, and feedback.

Environmental Factors

Although L’Oréal Paris is an established brand with a significant market share in the personal care industry, in general, and in the haircare sector, in particular, they still have to consider various environmental factors while developing their products and marketing strategies.

Socio-cultural factor

Firstly, more and more consumers these days prefer independent brands and green products. Recent studies show correlations between green marketing mix (green packaging, green product, green place, and green promotion) and purchasing intention (Mahmoud, 2018). Customers want to buy products that suit their individual hair needs, be eco-friendly, and free from additives.

Trying to accommodate these demands, Botanicals line includes shampoos for different types of hair, produces attractive nature-inspired bottles, and aims for premium quality. The company also selects organic ingredients and claims to opt for using suppliers who employ natural extraction methods (Strategist, 2018, para. 4). L’Oréal Paris tries to maintain leading positions in a circular economy by minimizing waste in landfills caused by production processes (Fortunati, Martiniello and Morea, 2020). According to Anne Machet, all their bottles “are made of Polyethylene Terephthalate (PET), which is 100% recycled and recyclable”, and they “also offer larger containers – 400ml instead of 250ml – to reduce the number used per year” (Strategist, 2018, para. 4). Thus, with the Botanicals line, the company tries to establish the reputation of an environmentally responsible company.

Competition

The hair care industry is a sector of the economy with a lot of competition. There are other well-known haircare brands such as Aveda (Estée Lauder), Pantene, and Head & Shoulders. Some companies also position themselves as environmentally friendly or nature-inspired (Lush, Ives Rocher, an American brand OGX, and Garnier, with Ultra Doux line). In addition, a threat to L’Oréal Paris is posed by salon-style and professional hair care products. To maintain a competitive edge, the company aims to emphasize that they combine environmental awareness with respect for their customers hair.

To indicate the quality of the shampoo, L’Oreal Paris established a high price for their product. According to Amazon UK, for 400 ml of Botanicals shampoo, it varies between 7.99 to 15.40 pounds (8.90 – 17.15 euros), which is pricier than other shampoos by L’Oréal Paris (2020a). However, considering the production process, the ingredients used, and the product’s target customer, a higher price successfully indicates the quality of the shampoo. Moreover, to attract more customers, discounts are often offered at different distribution channels. Their competitors prices are generally similar: the same amount of Ultra Doux (Garnier) shampoo costs at Amazon UK about 10.70 – 10.90 pounds (11.91 – 12.14 euros), while 385 ml of OGX shampoo – 7.99 pounds (8.90 euros) without discounts (2020b; 2020c). It is important to note that high-class personal care products prices tend to be inelastic, which means that lowering the price to get a competitive edge may not be an effective strategy and result only in less overall revenue.

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Technological factors

With growing ecological awareness, companies have to engage in constant modernization and research to create environmentally-sustainable products. At the same time, maintaining a competitive edge in the marketplace also requires innovations for customers different hair needs. Moreover, with more and more consumers opting to purchase products online, diversification of distribution channels and digitalization of marketing is also required.

L’Oréal distributes its Botanicals Fresh Care products through different channels: through pharmacies, specialty stores, and supermarkets, and also online (regional and global e-commerce platforms). When the product was launched, the intended marketing strategies included promotion on YouTube (in the form of tutorials) and collaborations with influencers (Deslandes, 2017, para. 4). However, as of 2020, there are not many commercials and sponsored videos with Botanicals Fresh Care line on YouTube, which would have a lot of views.

Target market

Since L’Oréal Paris aspires to become a brand suitable for people of different ages with various income levels, they have product lines aimed at different social groups. Botanicals Fresh Care’s primary target market is middle-class and upper-middle-class millennials who are interested both in their health and environmental protection, being ready to pay extra money for natural ingredients and recyclable packaging. As Anne Machet, L’Oréal Paris’s International Deputy Managing Director, explains, their intended audience is “devotees of a healthy lifestyle – those who, if given the option, would choose their bike over a moped and organic food over junk food – as well as eco-conscious consumers” (Strategist, 2018, para. 2). Therefore, their target customer would be an environmentally aware woman in her 20s or 30s with a middle- or high-income level who cares about her health and appearance. She is likely to be an active social media user, have a college or even a master’s degree, be career-oriented, and live in a big city. She is ready to spend extra money on premium products and may become a regular customer if satisfied with the quality. However, she is an expressive buyer and wants respect and attention during a transaction. She is an active social media user, particularly of YouTube, Instagram, and Pinterest.

Customer Profile

Description
A woman in her 20s or 30s, environmentally aware, likely vegan. Interested in beauty products and self-care. Concentrated on career and interested in self-development.
Social Networks: YouTube, Instagram, Pinterest
Demographics
Gender: female Family: no children/ one or two children
Age: 22-36 Education: college, masters
Marital Status: single / newly married Religion: non-religious, protestant
Occupation: freelance, marketing, designer, architect Income: $100,000 or more
Geographic
Country: Europe, US, Australia City/Town: Paris, London, Canberra, New York, San Francisco, Marseille

Marketing Mix

Proposing new marketing strategies should start with establishing clear goals. In this case, the objectives include:

  1. changing customers’ perception about the products’ position in the marketplace
  2. increasing the sale of the products by 20% within 2 months
  3. 10 new customer contacts on the database per month to assist with personal promotion of products and/or services

Market positioning

The product itself, the packaging, and the price align with the company’s goals, so the most critical amendments should include improving market positioning and promotion strategies. As described in the environmental factors analysis section, due to the growing demand for green goods, L’Oreal Paris has created and introduced its Botanicals Fresh Care shampoos as organic hair products. However, there are also other brands (such as Garnier with their Ultra Doux line) that employ similar nature-inspired advertising (Garnier Arabia, 2015). Therefore, it is essential to develop an effective market positioning strategy. To change customers perception about the product’s position in the marketplace, it is important to show that it possesses unique qualities (Corporate Finance Institute, n.d., para. 8). In the case of Botanicals shampoo, a positive public attitude can be created through emphasizing the fact that it combines respect for clients hair with environmental protection. One of their strengths is the amount of research conducted to create natural hair products effective for different hair needs.

The company can also maintain a competitive edge by highlighting that they do not merely use organic ingredients but also contribute to the environmental protection. Studies show that it is important to educate customers on the importance of eco-friendly production to eventually increase their purchasing intention (Suki, 2016). This can be mainly done through social media since it has been noted that green consumers generally use the Internet more often and are more likely to buy items on e-commerce platforms (Nyilasy and Gangadharbatla, 2016). Therefore, it is essential to actively engage in environmental-protection discussion and advertising Botanicals Fresh Care as a green brand online. Moreover, it can be useful to create a catchy slogan which would have close associations with the companys intended market position.

Promotion strategies

To attract more consumers within a short time, it can be advisable to redouble advertising efforts, considering the target customer profile. Research indicates that viewers tend to perceive bloggers as a credible source of information (Rasmussen, 2018). Influence marketing can be particularly successful in the beauty industry – consumers behaviour now largely depends on trends and reviews they see online (Paço and Oliveira, 2017). Studies advise to “integrate the influencers as elicitors of emotions so as to persuade consumers to buy and/or spread opinions about the products/services” (Paço and Oliveira, 2017, p. 133). In light of this information, the fact that Botanicals Fresh Care advertisements have not yet received enough social media attention indicates the need for a more active online marketing approach. Therefore, it might prove effective to organize collaborations with ecologically-conscious influencers and popular beauty bloggers on such platforms as Instagram and YouTube. Target marketing may also include signing contracts with environmentally-friendly e-commerce platforms and making discounts on Botanicals products, which would both widen the range of distribution channels and increase sales.

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Customer service

To achieve more customer contacts on the database per month, it can be useful to create a more personalized experience for clients. For online customers, it may include capturing their preferences by analysing reviews and giving personal feedback (Pappas, 2018). Studies claim that while earlier it has been difficult for managers to follow clients reactions and communication, now, through utilizing social media, they can monitor public perception about the brand (Kudeshia and Kumar, 2017). The companys representatives can also actively engage in providing recommendations and useful information to customers on various platforms to create a positive attitude to their product (Kudeshia and Kumar, 2017). For both shoppers who buy online and offline, it is essential to have a quality interaction with L’Oreal Paris’s employees who would be able to advise the best shampoo for their hair type and scent preferences. Loyalty programs and personal promo codes sent through emails can also be used.

Conclusion

Thus, the company already has several product placement strategies, which help introduce the shampoo line to its target audience. The pricing and production quality answer the intended position of the product in the marketplace. However, it is advisable to employ more active strategies regarding advertising Botanicals Fresh Care shampoos on social media platforms and redouble efforts on educating consumers on the importance of environmentally-friendly production emphasizing the contribution of L’Oréal Paris.

Reference List

Corporate Finance Institute. (n. d.) Market Positioning. Web.

Deslandes, M. (2017) ‘L’Oréal Paris launches Botanicals Fresh Care range’, Fashion Network. Web.

Fortunati, S., Martiniello, L. and Morea, D. (2020) ‘The strategic role of the corporate social responsibility and circular economy in the cosmetic industry’, Sustainability, 12(12), p.5120. Web.

Garnier Arabia (2015) Ultra Doux, the secret for hair as soft as a child’s. Web.

Kudeshia, C. and Kumar, A. (2017) ‘Social eWOM: does it affect the brand attitude and purchase intention of brands?’, Management Research Review, 40(3), pp. 310–330.

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Mahmoud, T. O. (2018) ‘Impact of green marketing mix on purchase intention’, International Journal of Advanced and Applied Sciences, 5(2), pp.127–135.

Nyilasy, G. and Gangadharbatla, H. (2016) ‘How to reach green consumers on the Internet? Digital and social media strategies for addressing the Environmentally conscious’, Proceedings of 2016 American Academy of Advertising Annual Conference, Seattle, WA, American Academy of Advertising, pp. 32–44.

Paço, A. and Oliveira, S. (2017) ‘Influence marketing in the fashion and beauty industry’, Estudos em Comunicação, 1(25), pp. 119 – 136.

Pappas, I. O. (2018) ‘User experience in personalized online shopping: a fuzzy-set analysis’, European Journal of Marketing, 52(7/8), pp. 1679–1703.

Rasmussen, L. (2018) ‘Parasocial interaction in the digital age: An examination of relationship building and the effectiveness of YouTube celebrities’, The Journal of Social Media in Society, 7(1), pp.280–294.

Strategist (2018). ‘Botanicals Fresh Care by L’Oréal Paris: engaged, beautiful and inspired by nature’, p. 1.

Suki, N. M. (2016) ‘Green product purchase intention: impact of green brands, attitude, and knowledge’, British Food Journal, 118(12), pp. 2893–2910.

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