Jamie Matusow, Editor01.25.10
Flip through almost any fashion magazine, and chances are you’ll find intriguing advertisements touting a wide array of L’Oréal’s multitudinous brands. In a recent issue of Elle, for instance, ads featured Lancôme’s Hypnôse Senses fragrance, Génefique skin care and vibrating Ôscillation Powerbooster mascara, Garnier Fructis Style’s Bounce-Back anti-humidity hairspray line, and Maybelline’s Great Lash waterproof mascara.
Unlike companies that focus on a single beauty channel, L’Oréal has famously mastered them all—from fragrance to cosmetics, skin care, hair care, cosmeceuticals and beyond. And whether competing for luxury or mass market sales, L’Oréal’s clever packaging often provides the extra touch that makes consumers reach for the L’Oréal product, with the motivating thought “Because I’m worth it.” The French beauty giant’s memorable slogan, introduced for L’Oréal’s Preference hair color in 1973, encourages women to treat themselves to mass market products that are not underpriced.
This pamper-yourself strategy, which combines product technology with packaging safety and innovation, has proved successful throughout the company’s 100-year existence, and has perhaps never been more relevant as in the current economy, as savvy consumers critically evaluate beauty purchases.
While science and beauty unite for a winning partnership, L’Oréal’s market dominance comes from attention paid to every detail, from concept through marketing.
Jonathan Ford, creative partner of design firm Pearlfisher, based in London and New York, believes L’Oréal’s tremendous success prevails due to its ability to hit all the right marketing buttons.
“As a designer,” he says, “I can appreciate the strength of L’Oréal’s collective design aesthetic—with its own-brand product ranges and the more newly acquired ones. Its design strength lies in the fact that it has captured the zeitgeist, and clearly gets the balance of science and beauty correct throughout its entire portfolio. Essentially it’s believable beauty and—in a volatile world—this message is powerful. L’Oréal associates itself with brand ambassadors who tap into all ages, races and sexes, and the portfolio leaves no stone unturned.”
Thelist of current L’Oréal spokespeople reads like a Hollywood director’s multicultural, multigenerational casting list, with popular screen stars including Jessica Alba, Elizabeth Banks, Diane Kruger, Evangeline Lilly, Freida Pinto, Diane Keaton, Demi Moore, Eva Longoria, Andie MacDowell, Cheryl Cole, Penelope Cruz, Jennifer Aniston, Kate del Castillo, Jessica Biel, Scarlett Johansson and Julia Roberts—along with a few men, such as heartthrobs Pierce Brosnan, Patrick Dempsey and Matthew Fox also fronting campaigns.
Founded in 1909 with a single hair dye product called L’Auréole, developed by French chemist Eugène Schueller in his Paris apartment, today L’Oréal operates in more than 130 countries, boasts more than 80,000 products from 25 leading beauty brands and creates more than 7,000 new formulations every year. From the very start, Schueller strove to combine the worlds of science and beauty, and to develop innovative products to meet consumers’ needs. L’Oréal has followed this philosophy for 100 years, believing that for a product to be a success, it must be useful, effective and of the highest quality in all respects. The company has expanded far beyond Schueller’s original start with hair color, adding every major channel of the beauty industry, as well as incorporating key acquisitions. Despite the prevailing economic picture of the past few years, L’Oréal’s corporate sales for fiscal year 2008 reached an enviable $25.8 billion.
According to Euromonitor International’s 2009 report on the world cosmetics market, the L’Oréal Group holds the No. 2 position overall, behind Procter & Gamble. While the French-based company also trails P&G in hair care, ittakes the lead in three other major categories: color cosmetics, fragrances and skin care. The L’Oréal Group is frequently referred to as the world’s largest cosmetics and beauty company.
Key to the success of a beauty company, says Carrie Mellage, director of consumer products research for Little Falls, NJ-based Kline & Company, is its ability to develop market-specific strategies to keep up with changing consumer behavior; the nuances of individual markets demand that beauty brands evolve alongside consumers to compete in a global arena.
“The takeaway message is that there is no one-size-fits-all strategy for success,” says Mellage. “The unique features of each country require marketers to think globally, but act locally to capitalize on specific opportunities. As an example, the rural population in Brazil is a huge potential market that depends heavily on direct person-to-person sales, while the more sophisticated and fickle shoppers in the mature beauty markets must be lured with exclusive offers, steep discounts, cool iPhone apps and social media connections.”
In the U.S., Mellage says the economic decline has prompted both marketers and retailers to actively engage customers with purchase incentives, loyalty programs, and even direct sales. Brands like Lancôme, she says, have stepped up marketing directly to customers, with online enticements like bonus gifts and free shipping with purchase.
“Savvy brands are employing a mix of complementary channels, including online sales, catalogs, and social networking to maximize their reach and target consumers in the format that’s most comfortable for them,” explains Karen Doskow, industry manager for consumer products research at Kline.
She adds that through novel approaches, such as YouTube videos that show how to apply products, and interactive try-before-you-buy apps for the PC and iPhone, sampling programs and vending-machine kiosks, brand marketers hope to diversify their customer base by going directly to the consumer.
Perhaps no company has kept pace as well as L’Oréal. While staying true to Schueller’s ethics, L’Oréal has also conquered a world of technology its visionary founder could have never imagined, and has devised market-specific strategies to keep up with changing consumer behavior.
Lois Johnson, a leading beauty expert and the former beauty and fashion director of More magazine, says, “L’Oréal’s brand portfolio has grown to ‘gimongous’ proportions—it’s an entire universe of beauty for face, body, hair and fragrance from drugstore to luxury. I give them a five-star rating and here’s why: They are doing a spectacular job of marketing to consumers who have become increasingly picky and difficult to connect with in tough economic times. I think they have done the impossible—translated the store experience online in a fresh interactive way that makes shopping for beauty online convincing.For example, shopping for foundation in a drugstore has to be one of life’s more frustrating experiences—it’s a crap shoot whether or not the texture and color will work. In a department store, you can try on shades, examine the texture and make a decision that is fairly accurate. This is why so many women 45+ are reluctant to switch to drugstore foundation now even though they’d love to do so. L’Oréal is solving this. If you go to www.lorealparisusa.com, and click on foundation matchmaker, you can actually find a drugstore shade of L’Oréal foundation to match the current department store brand and shade you are using. For my shade of Chanel Lift Lumiere in Beige, L’Oréal suggested its Visible Lift Foundation in Buff. For my Bobbi Brown Skin Foundation in Sand, they suggested L’Oréal True Match in Nude Beige W3. Great and totally accurate suggestions—I checked out both!The only problem is the brands listed are limited—they could use more luxury brands and even suggest low-high options within their own high-end brands, like Lancôme, Armani and YSL, and skin care, too.”
Johnson adds: “L’Oréal knows that women are shopping differently and instead of waiting for things to go back to normal, they realize this is the new normal! There is a shift away from advertising to the consumer making her own decisions and in a different way—at home, at her computer. L’Oréal has quickly moved away from the generic websites many giant brands maintain, and has personalized the experience and provided tips from experts that are actually useful and not just accessorizing the site.”
Whether onsite or online, packaging, of course, plays a key role in capturing attention—and sales—and, here too, L’Oréal goes the extra mile with everything it produces.
When creating thousands of products a year, says a L’Oréal spokesperson, “L’Oréal needs not only imagination and endurance, but also flawless organization. Each step of the life of a product is carefully orchestrated, from the laboratory to the packaging, to customer sales.”
Needless to say, packaging is a high priority at L’Oréal, one which takes on huge challenges due to worldwide distribution and the nuances associated with various regions. L’Oréal’s packaging designs stem from a global mindset, and include six basic criteria: innovation, safety, environmentally friendly, very trendy and beautiful, user-friendly and patented.
Foremost, L’Oréal endeavors to ensure that packaging is safe and high quality in terms of serving the consumer, as well as its effect on the environment. L’Oréal says its focus on sustainability for packaging began more than a decade ago, and is part of the company mindset. Extensive testing is performed upfront to qualify the packaging functionality, and is also done in combination with the formula to ensure a high-quality level of finished product for the consumer. Testing is also carried out to fine tune the quality of the functionality of the packaging so that consumers are satisfied with its use.
L’Oréal also relies on a specific “tool” called Consumer’s Voice in the Conception.This is a way of training engineers who work on the design/conception of the launch packaging.This ensures that they develop packaging technically to meet consumers’ preferences when using it, and it’s done in conjunction with the marketing department.Marketing defines what they want the packaging to be, what they want it to do, how they want it to be used, what environment it is going to be used in and how they expect the packaging to perform. The packaging team designs and conceives it, and then specifies it to the supplier. The supplier will then produce it according to the specification.This process makes it very clear to the packaging team what the expectations are, so they can clearly develop and engineer a final package that will meet those expectations.At the same time, these expectations include how the consumer will use it. If Marketing wants a cap to make a certain sound or a bottle to be squeezed to a certain level, Packaging defines it and translates those needs to the design.
“L’Oréal goes very deep into the way we think the consumer will use the product,”says a company spokesperson.
If arriving at a very trendy and beautiful, user-friendly, safe, innovative, and patented final package isn’t challenging enough, as a global distributor, L’Oréal must also find products that work all around the world. Its goal, says a corporate spokesperson, is to have packaging that looks the same on shelf regardless of what country it’s sold in, so Packaging is required to produce the same componentry in different countries to maintain a good source of supply.
L’Oréal operates with a global perspective, taking into account local factories and consumers around the world, knowing that people in different countries often think differently about products. Ideally, Marketing collects information from throughout the world to generate a global concept. This of course presents a major challenge for the packaging teams, which need to adhere to the global concept, but must deal with local resources in terms of suppliers, plants, strategies and more.
L’Oréal either buys stock components or builds custom tools. It creates roughly 1,000 new custom tools/molds worldwide each year to ensure unique designs, and maintains full control on quality, cost and innovation. Molds are developed to maintain brand identities and to meet specific requirements not yet available on the market. As part of its corporate innovation philosophy, L’Oréal strives to provide specific services to the customer.“If we don’t find it on the market,” says a spokesperson, “we develop our own shape, format, techniques and components.”
The ultimate goal, according to L’Oréal, is for consumers to find what they cannot find elsewhere. In order to achieve this, the product needs to have a unique shelf presence.
The steps in packaging and development are very well defined at L’Oréal, from conception. The company follows a specific step-by-step process to make sure that everything is fully validated before moving on to the next step. Whether for a cosmetic, fragrance, hair care or skin care launch, the process would follow the same steps even though they are very different products. It is a very clear thought process—sequential steps that build upon each other, and which result in a high-quality end product.
“We do not sacrifice quality,” says a L’Oréal spokesperson, “so we deal with real dynamics of each market. The target is always to be quick, first-to-market. This requires L’Oréal to be innovative not only on the product, but on all the processes to make it happen as well.”
Without these processes, it’s unlikely L’Oréal could have reached its current level, as it’s a vast organization, headquartered on two continents. L’Oréal USA, headquartered in New York City, with 2008 sales of over $4.5 billion and over 9,000 employees, is a wholly owned subsidiary of L’Oréal SA, based in France.
L’Oréal’s portfolio of brands includes Lancôme, Giorgio Armani, Shu Uemura, Yves Saint Laurent Beauté, Biotherm, Viktor & Rolf, Diesel, Cacharel, L’Oréal Paris, Garnier, Vichy, La Roche-Posay, L’Oréal Professionnel and Kérastase.
In addition, the U.S. is the base for the product development, international marketing and advertising for L’Oréal’s 11 American brands: Maybelline New York, SoftSheen-Carson, Kiehl’s Since 1851, Ralph Lauren, Redken 5th Avenue NYC, Matrix, Logics, Mizani, Pureology, SkinCeuticals and Dermablend.
According to data from Kline, L’Oréal is organized into three main branches: The Cosmetics branch (which encompasses the hair care, makeup, fragrances, and skin care categories—and generates the majority of sales); The Body Shop (acquired by L’Oréal in 2006, which operates as an independent entity within the company and sells only The Body Shop-branded products); and the Dermatology branch (which consists of Galderma Laboratories, a joint venture between L’Oréal and Nestlé).
L’Oréal’s Cosmetics branch consists of four divisions: Consumer Products (the largest division); Luxury Products (which markets premium-priced products);Professional Products (which markets hair care products for take-home and back-bar sale through professional salons); and Dermo-cosmetics skin care (brands such as Vichy, La Roche-Posay, and SkinCeuticals are marketed by the Active Cosmetics Division).
L’Oréal, in partnership with direct marketer 3 Suisses International, owns Club des Createurs de Beauté, a cosmetics mail order and internet company. Club des Createurs de Beauté has a strong presence in France and Japan.
With such a wide-ranging collection of products, it would be nearly impossible to list the particulars of each brand, but following are some of the most recent highlights surrounding L’Oréal’s commitment to combining packaging innovation with product science.
According to Kline’s latest research, hair coloring products was the second largest product category for L’Oréal in 2008, accounting for about 17% of the company’s sales.
When Schueller started the original company, he named it La Société Francaise des Teintures Inoffensives—or in English, The Safe Hair Dye Company of France. He sought to revolutionize the market by developing products that colored hair effectively, while also protecting, nourishing and improving its healthiness. New patented formulas and advances in packaging have appeared throughout the years, most recently marked by the introduction ofINOA (Innovation No Ammonia), an ammonia-free hair dye formula that works just as well as traditional hair dye, but without the ammonia odor associated with those formulas. INOA relies on a chemical called monoethanolamine, or MEA, which has no odor.
L’Oréal already sells ammonia-free permanent hair dyes that contain MEA in the U.S. and Europe. But because MEA does not open the cuticle as efficiently as ammonia, it does not allow the hair coloring ingredients to penetrate the hair strands as well. For this reason, MEA-based permanent hair coloring was only being used to darken the hair one shade, and not to lighten hair or color gray. So the L’Oréal chemists gave MEA a boost. INOA is already available in Europe, and should reach the U.S. early this year. The product should eventually be available for home use as well.
Garnier, in its recognizable green (or red) ergonomically shaped packages, topped with innovative applicators such as rollerballs or ball-shaped closures, spans several categories from hair care to skin care, earning it the distinction as the No. 1 beauty brand in France and a leader throughout Europe, Asia, Canada and Mexico.
In 2009, the brand known for its scientifically derived formulas enriched with selected natural ingredients, introducedGarnier Fructis Triple Nutrition, dubbed “health food for the hair.”
A new product range from Biolage, Colorcarethérapie Delicate Care, exemplifies L’Oreal’s commitment to develop a “greener portfolio.”
Diane Wade, assistant vice president global marketing, Biolage, says the move toward greener formulas and packaging was at consumers’ requests. She says, “We have been getting numerous requests from stylists and consumers who currently use Biolage, but are also environmentally conscious. Delicate Care is the first step. Looking ahead to the future, we want to extend our care for hair to greater care for the environment.”
Delicate Care uses PCR bottles, which Wade says is a growing trend. “Biolage has introduced 10 products with up to 25% post-consumer recycled (PCR) content,” she says, “and in 2010, we are introducing new 1-liter bottles that contain up to 50% PCR content (excluding cap) and use 15% less plastic. We are in the process of setting specific goals to increase the percentage of PCR content in our bottles across all products.”
Green accents have also been introduced on the Delicate Care containers, including a new green band on the front panel (which highlights key ingredients not incorporated into the formulations) and new green caps to convey the unique green/premium positioning of the range. A new 300ml, slender bottle has also been introduced, since the formula is highly concentrated and customers and stylists have to use less product without compromising performance. An eco-select icon calls attention to environmentally friendly properties.
Pureology currently uses up to 25% PCR in all shampoo and hair conditioner bottles. In the near future, the brand plans to increase the content in these bottles to 50%, as well as use 50% PCR content in all cartons, which will also move to 100% Forest Stewardship Council (FSC) stock.
In the salon trade class, according to Kline research, L’Oréal possesses two of the top four leading brands for 2008, Matrix and Redken.
Redken, a leader in salon hair care, celebrates its 50th anniversary this year. New introductions include Aerate 08 Bodifying Cream-Mousse, a patented styling product that fuses the volumizing benefits of a mousse and the conditioning properties of a cream to create an aerated texture for extreme volumizing—a first-to-market texture. The product is further unique in that Redken mastered putting a mousse in a jar rather than the usual pump format. According to a Redken spokesperson, the product has received great feedback from stylists since its launch in September 2009, and has been flying off salon shelves ever since.
Research from Kline pinpoints L’Oréal as a leading marketer of cosmetics and toiletries in the U.S. in 2008, and documents makeup products as the biggest product class for L’Oréal, with a share of about 34% in the company’s sales.
A spokesperson for L’Oréal explains that packaging can become quite complex in this category—especially true with two of its battery-operated products. For example, Lancôme Ôscillation mascara ($34), for the prestige market, comprises seven components (applicator, stem, inner cap, outer cap, motor/battery, bottle, wiper). This does not include labels and folding cartons.
Lancôme Ôscillation Powerfoundation ($48) also encompasses seven components (jar, sifter, sponge, wand, engine/battery, cap, overcap). This, too, does not include labels and folding cartons. Pressing the button activates the cushioned applicator and delivers 7,000 micro-vibrations per minute to break down the powder into micronized particles that blend seamlessly into the skin.
Other packages, too, like a lipstick, a compact or mascara, might require multiple molds.In all cases, each single component is fully designed, engineered and tested in respect to the performances of the finished good (as it relates to the customer, efficiency along the supply chain, etc.).
Eye makeup, the largest product category for L’Oréal, has a share of about 18% of sales. Much of the share can likely be attributed to Maybelline New York, which offers more than 200 products. Known for its innovative, constant stream of mascaras, in 2009, the brand introduced the first-to-mass vibrating mascara Pulse Perfection, for just $14.95.
Just as the shades for Maybelline New York’s creamy range of Color Sensational Lipcolors are grouped into four color families, so, too, is the packaging. Inspired by the New York skyline, sleek, luxurious cases are available in various shades of red, pink, plum and natural to emphasize the color inside, and make it easier to find your shade.
For the 2009 holiday season, Shu Uemura, known for combining art with beauty, teamed with fashion designer Tsumori Chisato for a makeup collection that embodied the spirit ofTokyo. “Wish Upon a Star” mixed Chisato’s playful style with the brand’s cutting edge look for a charming collection of artistic palettes.
Perhaps no brand has done more for L’Oréal’s share in the premium cosmetics market than its 2007 acquisition of Yves Saint Laurent Beauté. While the newly acquired brandboosted sales for L’Oréal in 2008, a report from Euromonitor warns that growth may now be threatened due to the current economic climate, in which consumers are transitioning to mass brands. At present, the brand is predominantly based in Western Europe (65%), followed by North America (16%). Euromonitor suggests that L’Oréal can minimize any risks by successfully expanding the YSL brand to emerging markets.
Still, it seems that YSL products will always have a place for consumers looking for a beauty treat. YSL Beauté describes luxury. It starts with the richness of the package: shiny gold, like fine jewelry, emblazoned with just a touch of color in the red and black blocks that in turn, highlight the easily recognizable YSL signature logo. Pick it up, and you can’t help but notice the weightiness—not only a sign of quality but a signal to expect something noteworthy inside. This describes the case for Your Lovely Palette ($75). Lift the substantial black cardboard flap inside the carton, and you’ll glimpse what looks to be a black patent leather watchband with a gold buckle. Pull the strap and find it attached to a weighty gold case in the shape of a couture-like luggage tag, detailed with a heart and the Yves Saint Laurent name embossed on the cover. Lift the cover to find a gold-framed mirror, two complementary lip or eye colors and a tiny brush with the YSL logo engraved in the handle.
YSL’s Rouge Volupte lipstick flaunts a similar glamour and surprise touches. A small, round mirror adorns the top of the gold cap, so there’s no need to carry a separate mirror for on-the-go touchups. A band around the center of the case features repeats of the YSL logo atop a color band, similar to a couturier touch—or a carved cameo revealing the color beneath—with layers of delicate lace atop solid color fabric. A true piece of luxury for less than $35, it comes in a variety of 18 shades, and is definitely worth it.
L’Oréal may be widely recognized as the world’s No. 1 cosmetics company, but what may seem surprising to some is that the distinction includes its ranking as No. 1 in fragrance—ahead of Coty and P&G, according to data from Euromonitor. New fragrances, such as Lancôme Magnifique, according to Euromonitor, served to create excitement among consumers in 2009.
YSL Beauté’s fragrance offering was also on target in 2009 with the launch ofParisienne, promoted by supermodel Kate Moss. The flacon is intricately carved to represent a labyrinth of Parisian streets, and colored to resemble the pale pink of early morning. The YSL signature is stamped in gold on a black leather label and capped wth a golden dome.
Ralph Lauren returned to a classic in 2009, releasing Ralph Lauren Always Yours, a new chapter following the original Romance fragrance, which celebrated its 10th anniversary. The Limited edition parfum features a delicately handcrafted glass dauber, faceted in the spirit of a diamond, the modern symbol of love and the traditional gift for 10 years of marriage.
For men, Ralph Lauren launched a new variation of Polo Red, White & Blue. The packaging takes its cues from the colors of the American flag and Ralph Lauren’s heritage as a prominent American designer. The sleek blue bottle is accented by polished red and white diagonal racing stripes, an oversized gold polo player icon and a gold-colored cap. The carton reflects the new look, and is topped by an image of the Ralph Lauren American flag. The embellishments maintain the Polo Blue tradition, yet bestow a special touch to personify the distinctive new fragrance.
Facial treatments are L’Oréal’s third largest channel, and perhaps no other category expresses as strongly L’Oréal’s masterful combination of science and packaging.
With several thousand new formulas and more than 500 patents registered each year, and in the spirit of Schueller’s commitment to incorporating science in the development of cosmetics, L’Oréal claims leadership in research in the cosmetics industry.
Science to the max describes Lancôme’s recent launch of Génifique—its latest revolution in anti-aging skin care, based on cellular reprogramming. The company’s 10 years of research into the biological behavior of stem cells, which are responsible for skin and hair regeneration during aging, has provided insight into how to select the active ingredients that protect them. L’Oréal received seven patents for its work in this area.
Génifique Youth Activating Concentrate ($78) is considered to be a new category of product designed to be the foundation of a modern skin care routine. The sleek dropper bottle provides the perfect delivery system. Simply pump the top to fill the dropper with the exact amount of product needed. Pump the contents of the dropper onto the palm of your hand, warm the product, then apply to your face.
La Roche-Posay falls into L’Oréal’s Dermo-cosmetics skin care category. Recommended by dermatologists worldwide, it offers adjunctive therapy, daily skin care products formulated with highly concentrated ingredients targeting every skin’s needs—and tested on sensitive skin. Its daily use products include formulations based on thermal spring water rich in selenium, a powerful antioxidant. Formulations are clinically proven for safety and efficacy. A number of products were launched in 2009, including several sunscreens. Anthelios 60 Ultra Light Sunscreen Fluid had particularly innovative packaging, not seen in suncare bottles, especially in the U.S.
A spokesperson for the brand explains the unique side dispenser, which also underscores L’Oréal’s efforts to keep packaging consistent throughout the world: “The international version of the bottle features the dispenser on the side, and so in order to have continuity, we adapted the look as well. Furthermore, the dispenser on the side versus the middle allows the fluid to dispense more evenly onto the hands.”
Kiehl’s is one of L’Oréal’s testaments to sustainability and an example of its dedication to creating a “greener” portfolio. Kiehl’s Acai Damage-Repairing Collection was the brand’s biggest skin care launch of 2009. All four products within the line are certified as organic products by Ecocert.In regards to packaging, this collection is the first-ever skin care range to receive gold standard cradle-to-cradle certification—producing the minimal amount of waste during the production process—from start to finish.
Most recently in skin care, L’Oréal Paris created a new brand in the cleansing market with the launch of Go 360 Clean, a four item line that includes a brand new applicator, which L’Oréal calls a scrublet. The rubbery cleansing device is attached directly to the package and can be removed for exfoliation purposes. “Slumdog Millionaire” star Freida Pinto has been named spokeswoman for the brand.
Now in the 21st century, the L’Oréal adventure continues, loyal to its past and the convictions of its founder, but also eager to explore new horizons and change with the times, always keeping the combination of superior formulas and innovative packaging at the forefront.
“Yes,” affirms Pearlfisher’s Ford, “the design story is obviously strong, consistent, simple and effective. But the marketing story, and the strategy for building this business with both iconic and challenger brands, appears to be its most powerful and compelling driver and explains its phenomenal global success. Think L’Oréal—and think quality, innovation, diversity and excellence. It’s an undisputed global giant, but one that has tapped into the psyche of the individual. ‘Because we’re worth it,’ says it all.”
•The history of the company dates from 1907 when Eugène Schueller, a young French chemist, created the first synthetic hair dye. Eugène Schueller registered two names for his product: “Black and Gold”, a logical brand name for a hair colorant with black representing the spectrum of dark shades and gold the warm tones – a brand name which was however never used; “L’Aureale”, a name inspired by a hairstyle in fashion at the time called “L’Aureole” from the Latin aureola, golden crown and by extension a luminous and colored halo. A few months later the name was simplified to “L'Oréal” which interestingly has its roots from the Greek “Orea” which means beauty.
•With just 120 Euros in his pocket, Eugène Schueller registered his company “The Societe Francaise de Teintures Inoffensives pour Cheveux”. He established the company in a two-bedroom apartment in rue d’Alger – the dining room was used as the demonstration room and the bedroom as the laboratory.Eugène Schueller did everything himself – he manufactured his products during the night, then sold them to Parisian hairdressers during the morning and delivered them in the afternoon.
•Eugène Schueller gained the backing of an accountant from Epernay who loaned him 4000 Euros. This enabled Eugène Schueller to think on a larger scale - he moved the company which he renamed “L'Oréal” to a four bedroom apartment in the rue du Louvre, he recruited his first employee and he began to advertise his products via a trade journal “La Coiffure de Paris”.
•Eugène Schueller soon began to export his products abroad – from 1910 L'Oréal products were sold in Austria and Italy – by 1914 an additional six markets had been added; Hungary, Germany, Belgium, Holland, Switzerland and Russia and by the 1920s sales had been extended to the Americas, Russia and the Far East.
•During the twenties, fashion changed. Women started getting their hair cut. A short style required shape and, more importantly, color. L’Oréal responded to this need by creating Imédia Liquide.
•Eugène Schueller recognized a huge potential for hygiene and toiletry products for the body and hair. He took over Monsavon and in 1934 launched Dop, the first mass-market shampoo without soap (which left traces on the hair). It became L’Oréal’s philosophy to make technological products available to the largest number of people.
•L’Oréal launched the sun tan oil Ambre Solaire, which became very successful the following year as the French started to go on their first paid holidays and enjoy the pleasure of sunbathing.
•L’Oréal launched Oréol, the first cold wave in Europe: a real revolution in the world of hairdressing and the life of its customers.
•Régé-Color became hugely successful with hairdressers. It was the start of the coloring culture among the masses in France.
•L’Oréal began to commercialize its products in broader distribution channels.
•The company Cosmair Inc. was created and became the exclusive licensee of the L’Oréal Group in the USA.Headquartered in New Jersey, it did not move to New York until 1965.
•Elnett hairspray was launched. It was a technological breakthrough in the hairstyling market. Elnett contained certain polymers, which could be removed with light brushing while other products on the market at that time contained lacquer which was very difficult to remove.Today Elnett remains one of the most coveted products of hairstylists around the world.
•Lancôme was acquired, which transported L’Oréal into the world of toiletries, make-up and perfume and gave it access to the selective channels of the perfume sector.
•L’Oréal took over Garnier.
•Guy Laroche Perfumes were created. With the launch of Fidji, the L’Oréal Group became involved in the creation and development of perfumes for the first time.
•L’Oréal introduces Preference, its first mass-market haircolor line.
•L’Oréal acquires Biotherm.
•L’Oreal take-over of the Synthélabo Pharmaceutical Laboratories.
•The Gemey brand was acquired.
•L’Oreal introduces the “Because I’m Worth It” ad campaign, which was created in the US.
•Lancôme introduced in the US.
•Equalia by Vichy was created, the first moisturizer based on an anti-dehydration mechanism. L’Oréal had already signed technical agreements with Vichy in 1954. This company was acquired outright in 1980.
•Anais Anais perfume by Cacharel was launched.
•C.I.R.D (Centre International de Recherches Dermatologiques) was created at Sofia-Antipolis, specializing in the treatment of skin problems and ageing.
•Plénitude was launched, representing the entry of the L’Oreal Paris brand into skincare.Today Plénitude is known as Dermo-Expertise.
•L’Oréal acquires Ralph Lauren Fragrances.
•Niosome by Lancôme was launched. The niosomes, created and patented by the L’Oréal Group’s research division, are part of the liposome family.
•Helena Rubinstein was acquired.
•Take-over of La Roche-Posay Pharmaceutical Laboratories, specialists in skin care.
•Trésor, the iconic Lancôme women’s fragrance was launched.
•Redken was acquired by L’Oréal, which manufactures and distributes products for professional hairdressers.
•Capital Soleil by Vichy, which contains the new filter Mexoryl SX, was launched.
•Cosmair became a wholly-owned subsidiary of the L’Oréal Group.
•The L’Oréal Group acquired the American mass-market make-up company, Maybelline.In the same year, L’Oréal bought the Chilean company, Unisa.One year before, the Group had taken over the company, Jade, in Germany within the same market. With these acquisitions, L’Oréal became the world leader in the mass-market make-up sector.
•L’Oréal brought together its cosmetic activities in Japan under one subsidiary, Nihon L’Oréal.
•Soft Sheen Products, the American company, which specializes in ethnic hair products, was acquired by L’Oreal USA
•L’Oréal signed a partnership with UNESCO bringing to the forefront women’s fundamental role in research, notably in the life sciences.The program was called For Women in Science.
•L'Oréal acquired Maybelline in Japan. As a result of the acquisition L'Oréal now had the world rights to Maybelline.
•L’Oréal acquired Miss Ylang, the leading mass-market make-up company in Argentina
•L’Oréal acquired the US company Carson (the world leader in ethnic hair products).As well as Matrix (the number 1 brand in the American professional haircare market) and Kiehl's Since1851.
•L'Oréal acquired the shampoo brand Respons.
•Cosmair Inc. changes its name to L’Oréal USA.
•L’Oréal acquires the US company BioMedic which specialized in skin care products to accompany dermatology and plastic surgery treatments.
•L’Oreal announces the acquisition of Colorama, the Brazilian mass-market make-up and shampoo brand.
•L'Oréal acquired a 35% interest in the Japanese company shu uemura.
•L’Oréal and Dutch designers Viktor & Rolf enter into a partnership for the launch of new fragrances.
•L’Oréal acquired the US company ARTec, which markets hair care and hair color products for the professional salon industry.
•L’Oréal entered Fortune Magazine’s annual All-Star list of the world’s 50 “Most Admired Companies.”
•L’Oréal inaugurated the first ethnic hair and skin research center in Chicago.The Institute was the first research center in the world uniquely dedicated to studying the skin and hair of different ethnic groups.
•L’Oréal joined the « Global Compact » an international sustainable development initiative launched by United Nations’ Secretary-General Kofi Annan in 2000.
•L’Oréal acquired the majority share in shu uemura Cosmetics Inc., the company that manufactures and markets shu uemura brand cosmetics in Japan (4 years after acquiring 35% of shu uemura’s Japanese operations and the international rights to the brand outside of Japan).
•The L’Oréal Group signed an agreement to acquire one of the top three skincare brands in China: Mininurse. At the time of acquisition, this mass-market brand was distributed throughout approximately 280 000 outlets across the country.
•L’Oréal acquires the Chinese make-up and skincare brand Yue-Sai
•L’Oréal inaugurates a new manufacturing plant in Pune, India which has been especially conceived to apply the most stringent international regulations for quality and hygiene in cosmetics manufacturing
•A new agreement between the majority shareholders of L’Oréal for the absorption of the holding company Gesparal by L’Oréal. Upon completion of the transaction, the Bettencourt family and Nestlé become direct shareholders of L’Oréal. Mrs. Bettencourt remains the largest shareholder of L’Oréal
•L’Oreal receives the Diversity Best Practices Global Leadership Award which was accepted by Sir Lindsay Owen-Jones.
•Sir Lindsay Owen-Jones received the Anti-DefamationLeague’s International Leadership Award in recognition of his career, community leadership, and commitment to diversity.
•Mexoryl approved in the US
•L’Oréal opens a research center in Pudong, China to support basic scientific research to understand the structure and behavior of Chinese hair and skin.
•L’Oréal acquires the US company, SkinCeuticals and integrates it into the Active Cosmetics Division.
•L’Oreal acquires The Body Shop.Remaining a separate business within L’Oreal, it became the 7th largest brand with a distinct positioning in the high growth “naturally oriented” segment.It was the perfect fit with L’Oréal’s existing diverse portfolio of international brands with different cultural origins.
•Mexoryl gets FDA approval for use in the US.
•L’Oréal acquires the US company PureOlogy, a luxury brand sold through hairdressers in the professional market.The products are uniquely developed for hair colorists to use and recommend to their clients.The brand is notable for its range of highly concentrated sulfate free shampoos.
•After obtaining the necessary authorizations from all the competition authorities, L'Oréal and PPR signed a definitive agreement for the effective transfer of Yves Saint Laurent Beauté to L'Oréal.YSL Beauté was incorporated into the Luxury Products Division.
•L’Oréal celebrates 100th anniversary
Unlike companies that focus on a single beauty channel, L’Oréal has famously mastered them all—from fragrance to cosmetics, skin care, hair care, cosmeceuticals and beyond. And whether competing for luxury or mass market sales, L’Oréal’s clever packaging often provides the extra touch that makes consumers reach for the L’Oréal product, with the motivating thought “Because I’m worth it.” The French beauty giant’s memorable slogan, introduced for L’Oréal’s Preference hair color in 1973, encourages women to treat themselves to mass market products that are not underpriced.
This pamper-yourself strategy, which combines product technology with packaging safety and innovation, has proved successful throughout the company’s 100-year existence, and has perhaps never been more relevant as in the current economy, as savvy consumers critically evaluate beauty purchases.
Right on Target
While science and beauty unite for a winning partnership, L’Oréal’s market dominance comes from attention paid to every detail, from concept through marketing.
Jonathan Ford, creative partner of design firm Pearlfisher, based in London and New York, believes L’Oréal’s tremendous success prevails due to its ability to hit all the right marketing buttons.
“As a designer,” he says, “I can appreciate the strength of L’Oréal’s collective design aesthetic—with its own-brand product ranges and the more newly acquired ones. Its design strength lies in the fact that it has captured the zeitgeist, and clearly gets the balance of science and beauty correct throughout its entire portfolio. Essentially it’s believable beauty and—in a volatile world—this message is powerful. L’Oréal associates itself with brand ambassadors who tap into all ages, races and sexes, and the portfolio leaves no stone unturned.”
Thelist of current L’Oréal spokespeople reads like a Hollywood director’s multicultural, multigenerational casting list, with popular screen stars including Jessica Alba, Elizabeth Banks, Diane Kruger, Evangeline Lilly, Freida Pinto, Diane Keaton, Demi Moore, Eva Longoria, Andie MacDowell, Cheryl Cole, Penelope Cruz, Jennifer Aniston, Kate del Castillo, Jessica Biel, Scarlett Johansson and Julia Roberts—along with a few men, such as heartthrobs Pierce Brosnan, Patrick Dempsey and Matthew Fox also fronting campaigns.
In the Beginning
Founded in 1909 with a single hair dye product called L’Auréole, developed by French chemist Eugène Schueller in his Paris apartment, today L’Oréal operates in more than 130 countries, boasts more than 80,000 products from 25 leading beauty brands and creates more than 7,000 new formulations every year. From the very start, Schueller strove to combine the worlds of science and beauty, and to develop innovative products to meet consumers’ needs. L’Oréal has followed this philosophy for 100 years, believing that for a product to be a success, it must be useful, effective and of the highest quality in all respects. The company has expanded far beyond Schueller’s original start with hair color, adding every major channel of the beauty industry, as well as incorporating key acquisitions. Despite the prevailing economic picture of the past few years, L’Oréal’s corporate sales for fiscal year 2008 reached an enviable $25.8 billion.
According to Euromonitor International’s 2009 report on the world cosmetics market, the L’Oréal Group holds the No. 2 position overall, behind Procter & Gamble. While the French-based company also trails P&G in hair care, ittakes the lead in three other major categories: color cosmetics, fragrances and skin care. The L’Oréal Group is frequently referred to as the world’s largest cosmetics and beauty company.
World Domination
Key to the success of a beauty company, says Carrie Mellage, director of consumer products research for Little Falls, NJ-based Kline & Company, is its ability to develop market-specific strategies to keep up with changing consumer behavior; the nuances of individual markets demand that beauty brands evolve alongside consumers to compete in a global arena.
“The takeaway message is that there is no one-size-fits-all strategy for success,” says Mellage. “The unique features of each country require marketers to think globally, but act locally to capitalize on specific opportunities. As an example, the rural population in Brazil is a huge potential market that depends heavily on direct person-to-person sales, while the more sophisticated and fickle shoppers in the mature beauty markets must be lured with exclusive offers, steep discounts, cool iPhone apps and social media connections.”
Novel Approaches
In the U.S., Mellage says the economic decline has prompted both marketers and retailers to actively engage customers with purchase incentives, loyalty programs, and even direct sales. Brands like Lancôme, she says, have stepped up marketing directly to customers, with online enticements like bonus gifts and free shipping with purchase.
“Savvy brands are employing a mix of complementary channels, including online sales, catalogs, and social networking to maximize their reach and target consumers in the format that’s most comfortable for them,” explains Karen Doskow, industry manager for consumer products research at Kline.
She adds that through novel approaches, such as YouTube videos that show how to apply products, and interactive try-before-you-buy apps for the PC and iPhone, sampling programs and vending-machine kiosks, brand marketers hope to diversify their customer base by going directly to the consumer.
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(L-R): L’Oréal packaging leaders Maria Archambault (director of packaging/professional products division, corporate operations North America); Philippe Bonningue (vice president of packaging and development, corporate operations North America); Catherine McComber (assistant vice president of packaging/consumer products division, corporate operations North America). |
Keeping It Modern
Perhaps no company has kept pace as well as L’Oréal. While staying true to Schueller’s ethics, L’Oréal has also conquered a world of technology its visionary founder could have never imagined, and has devised market-specific strategies to keep up with changing consumer behavior.
Lois Johnson, a leading beauty expert and the former beauty and fashion director of More magazine, says, “L’Oréal’s brand portfolio has grown to ‘gimongous’ proportions—it’s an entire universe of beauty for face, body, hair and fragrance from drugstore to luxury. I give them a five-star rating and here’s why: They are doing a spectacular job of marketing to consumers who have become increasingly picky and difficult to connect with in tough economic times. I think they have done the impossible—translated the store experience online in a fresh interactive way that makes shopping for beauty online convincing.For example, shopping for foundation in a drugstore has to be one of life’s more frustrating experiences—it’s a crap shoot whether or not the texture and color will work. In a department store, you can try on shades, examine the texture and make a decision that is fairly accurate. This is why so many women 45+ are reluctant to switch to drugstore foundation now even though they’d love to do so. L’Oréal is solving this. If you go to www.lorealparisusa.com, and click on foundation matchmaker, you can actually find a drugstore shade of L’Oréal foundation to match the current department store brand and shade you are using. For my shade of Chanel Lift Lumiere in Beige, L’Oréal suggested its Visible Lift Foundation in Buff. For my Bobbi Brown Skin Foundation in Sand, they suggested L’Oréal True Match in Nude Beige W3. Great and totally accurate suggestions—I checked out both!The only problem is the brands listed are limited—they could use more luxury brands and even suggest low-high options within their own high-end brands, like Lancôme, Armani and YSL, and skin care, too.”
Johnson adds: “L’Oréal knows that women are shopping differently and instead of waiting for things to go back to normal, they realize this is the new normal! There is a shift away from advertising to the consumer making her own decisions and in a different way—at home, at her computer. L’Oréal has quickly moved away from the generic websites many giant brands maintain, and has personalized the experience and provided tips from experts that are actually useful and not just accessorizing the site.”
Nuances of Packaging
Whether onsite or online, packaging, of course, plays a key role in capturing attention—and sales—and, here too, L’Oréal goes the extra mile with everything it produces.
When creating thousands of products a year, says a L’Oréal spokesperson, “L’Oréal needs not only imagination and endurance, but also flawless organization. Each step of the life of a product is carefully orchestrated, from the laboratory to the packaging, to customer sales.”
Needless to say, packaging is a high priority at L’Oréal, one which takes on huge challenges due to worldwide distribution and the nuances associated with various regions. L’Oréal’s packaging designs stem from a global mindset, and include six basic criteria: innovation, safety, environmentally friendly, very trendy and beautiful, user-friendly and patented.
Foremost, L’Oréal endeavors to ensure that packaging is safe and high quality in terms of serving the consumer, as well as its effect on the environment. L’Oréal says its focus on sustainability for packaging began more than a decade ago, and is part of the company mindset. Extensive testing is performed upfront to qualify the packaging functionality, and is also done in combination with the formula to ensure a high-quality level of finished product for the consumer. Testing is also carried out to fine tune the quality of the functionality of the packaging so that consumers are satisfied with its use.
L’Oréal also relies on a specific “tool” called Consumer’s Voice in the Conception.This is a way of training engineers who work on the design/conception of the launch packaging.This ensures that they develop packaging technically to meet consumers’ preferences when using it, and it’s done in conjunction with the marketing department.Marketing defines what they want the packaging to be, what they want it to do, how they want it to be used, what environment it is going to be used in and how they expect the packaging to perform. The packaging team designs and conceives it, and then specifies it to the supplier. The supplier will then produce it according to the specification.This process makes it very clear to the packaging team what the expectations are, so they can clearly develop and engineer a final package that will meet those expectations.At the same time, these expectations include how the consumer will use it. If Marketing wants a cap to make a certain sound or a bottle to be squeezed to a certain level, Packaging defines it and translates those needs to the design.
“L’Oréal goes very deep into the way we think the consumer will use the product,”says a company spokesperson.
If arriving at a very trendy and beautiful, user-friendly, safe, innovative, and patented final package isn’t challenging enough, as a global distributor, L’Oréal must also find products that work all around the world. Its goal, says a corporate spokesperson, is to have packaging that looks the same on shelf regardless of what country it’s sold in, so Packaging is required to produce the same componentry in different countries to maintain a good source of supply.
L’Oréal operates with a global perspective, taking into account local factories and consumers around the world, knowing that people in different countries often think differently about products. Ideally, Marketing collects information from throughout the world to generate a global concept. This of course presents a major challenge for the packaging teams, which need to adhere to the global concept, but must deal with local resources in terms of suppliers, plants, strategies and more.
Stock or Custom?
L’Oréal either buys stock components or builds custom tools. It creates roughly 1,000 new custom tools/molds worldwide each year to ensure unique designs, and maintains full control on quality, cost and innovation. Molds are developed to maintain brand identities and to meet specific requirements not yet available on the market. As part of its corporate innovation philosophy, L’Oréal strives to provide specific services to the customer.“If we don’t find it on the market,” says a spokesperson, “we develop our own shape, format, techniques and components.”
The ultimate goal, according to L’Oréal, is for consumers to find what they cannot find elsewhere. In order to achieve this, the product needs to have a unique shelf presence.
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(L-R): L’Oréal development heads Justin Kort (VP development; consumer products division; Karen Curley (VP development; professional products division; Terri Schramm (VP development; luxury products & active cosmetics divisions); Nathalie Lacrampe (AVP development; consumer products division). |
Focus on Packaging
The steps in packaging and development are very well defined at L’Oréal, from conception. The company follows a specific step-by-step process to make sure that everything is fully validated before moving on to the next step. Whether for a cosmetic, fragrance, hair care or skin care launch, the process would follow the same steps even though they are very different products. It is a very clear thought process—sequential steps that build upon each other, and which result in a high-quality end product.
“We do not sacrifice quality,” says a L’Oréal spokesperson, “so we deal with real dynamics of each market. The target is always to be quick, first-to-market. This requires L’Oréal to be innovative not only on the product, but on all the processes to make it happen as well.”
Portfolio of Great Proportions
Without these processes, it’s unlikely L’Oréal could have reached its current level, as it’s a vast organization, headquartered on two continents. L’Oréal USA, headquartered in New York City, with 2008 sales of over $4.5 billion and over 9,000 employees, is a wholly owned subsidiary of L’Oréal SA, based in France.
L’Oréal’s portfolio of brands includes Lancôme, Giorgio Armani, Shu Uemura, Yves Saint Laurent Beauté, Biotherm, Viktor & Rolf, Diesel, Cacharel, L’Oréal Paris, Garnier, Vichy, La Roche-Posay, L’Oréal Professionnel and Kérastase.
In addition, the U.S. is the base for the product development, international marketing and advertising for L’Oréal’s 11 American brands: Maybelline New York, SoftSheen-Carson, Kiehl’s Since 1851, Ralph Lauren, Redken 5th Avenue NYC, Matrix, Logics, Mizani, Pureology, SkinCeuticals and Dermablend.
According to data from Kline, L’Oréal is organized into three main branches: The Cosmetics branch (which encompasses the hair care, makeup, fragrances, and skin care categories—and generates the majority of sales); The Body Shop (acquired by L’Oréal in 2006, which operates as an independent entity within the company and sells only The Body Shop-branded products); and the Dermatology branch (which consists of Galderma Laboratories, a joint venture between L’Oréal and Nestlé).
L’Oréal’s Cosmetics branch consists of four divisions: Consumer Products (the largest division); Luxury Products (which markets premium-priced products);Professional Products (which markets hair care products for take-home and back-bar sale through professional salons); and Dermo-cosmetics skin care (brands such as Vichy, La Roche-Posay, and SkinCeuticals are marketed by the Active Cosmetics Division).
L’Oréal, in partnership with direct marketer 3 Suisses International, owns Club des Createurs de Beauté, a cosmetics mail order and internet company. Club des Createurs de Beauté has a strong presence in France and Japan.
A Look at the Brands
With such a wide-ranging collection of products, it would be nearly impossible to list the particulars of each brand, but following are some of the most recent highlights surrounding L’Oréal’s commitment to combining packaging innovation with product science.
Hair Care Advances
According to Kline’s latest research, hair coloring products was the second largest product category for L’Oréal in 2008, accounting for about 17% of the company’s sales.
When Schueller started the original company, he named it La Société Francaise des Teintures Inoffensives—or in English, The Safe Hair Dye Company of France. He sought to revolutionize the market by developing products that colored hair effectively, while also protecting, nourishing and improving its healthiness. New patented formulas and advances in packaging have appeared throughout the years, most recently marked by the introduction ofINOA (Innovation No Ammonia), an ammonia-free hair dye formula that works just as well as traditional hair dye, but without the ammonia odor associated with those formulas. INOA relies on a chemical called monoethanolamine, or MEA, which has no odor.
L’Oréal already sells ammonia-free permanent hair dyes that contain MEA in the U.S. and Europe. But because MEA does not open the cuticle as efficiently as ammonia, it does not allow the hair coloring ingredients to penetrate the hair strands as well. For this reason, MEA-based permanent hair coloring was only being used to darken the hair one shade, and not to lighten hair or color gray. So the L’Oréal chemists gave MEA a boost. INOA is already available in Europe, and should reach the U.S. early this year. The product should eventually be available for home use as well.
Garnier, in its recognizable green (or red) ergonomically shaped packages, topped with innovative applicators such as rollerballs or ball-shaped closures, spans several categories from hair care to skin care, earning it the distinction as the No. 1 beauty brand in France and a leader throughout Europe, Asia, Canada and Mexico.
In 2009, the brand known for its scientifically derived formulas enriched with selected natural ingredients, introducedGarnier Fructis Triple Nutrition, dubbed “health food for the hair.”
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Biolage Colorcarethérapie Delicate Care uses PCR bottles and other “green” elements. |
Hair Care Goes Green
A new product range from Biolage, Colorcarethérapie Delicate Care, exemplifies L’Oreal’s commitment to develop a “greener portfolio.”
Diane Wade, assistant vice president global marketing, Biolage, says the move toward greener formulas and packaging was at consumers’ requests. She says, “We have been getting numerous requests from stylists and consumers who currently use Biolage, but are also environmentally conscious. Delicate Care is the first step. Looking ahead to the future, we want to extend our care for hair to greater care for the environment.”
Delicate Care uses PCR bottles, which Wade says is a growing trend. “Biolage has introduced 10 products with up to 25% post-consumer recycled (PCR) content,” she says, “and in 2010, we are introducing new 1-liter bottles that contain up to 50% PCR content (excluding cap) and use 15% less plastic. We are in the process of setting specific goals to increase the percentage of PCR content in our bottles across all products.”
Green accents have also been introduced on the Delicate Care containers, including a new green band on the front panel (which highlights key ingredients not incorporated into the formulations) and new green caps to convey the unique green/premium positioning of the range. A new 300ml, slender bottle has also been introduced, since the formula is highly concentrated and customers and stylists have to use less product without compromising performance. An eco-select icon calls attention to environmentally friendly properties.
Pureology currently uses up to 25% PCR in all shampoo and hair conditioner bottles. In the near future, the brand plans to increase the content in these bottles to 50%, as well as use 50% PCR content in all cartons, which will also move to 100% Forest Stewardship Council (FSC) stock.
First-to-Market Texture
In the salon trade class, according to Kline research, L’Oréal possesses two of the top four leading brands for 2008, Matrix and Redken.
Redken, a leader in salon hair care, celebrates its 50th anniversary this year. New introductions include Aerate 08 Bodifying Cream-Mousse, a patented styling product that fuses the volumizing benefits of a mousse and the conditioning properties of a cream to create an aerated texture for extreme volumizing—a first-to-market texture. The product is further unique in that Redken mastered putting a mousse in a jar rather than the usual pump format. According to a Redken spokesperson, the product has received great feedback from stylists since its launch in September 2009, and has been flying off salon shelves ever since.
Power Makeup
Research from Kline pinpoints L’Oréal as a leading marketer of cosmetics and toiletries in the U.S. in 2008, and documents makeup products as the biggest product class for L’Oréal, with a share of about 34% in the company’s sales.
A spokesperson for L’Oréal explains that packaging can become quite complex in this category—especially true with two of its battery-operated products. For example, Lancôme Ôscillation mascara ($34), for the prestige market, comprises seven components (applicator, stem, inner cap, outer cap, motor/battery, bottle, wiper). This does not include labels and folding cartons.
Lancôme Ôscillation Powerfoundation ($48) also encompasses seven components (jar, sifter, sponge, wand, engine/battery, cap, overcap). This, too, does not include labels and folding cartons. Pressing the button activates the cushioned applicator and delivers 7,000 micro-vibrations per minute to break down the powder into micronized particles that blend seamlessly into the skin.
Other packages, too, like a lipstick, a compact or mascara, might require multiple molds.In all cases, each single component is fully designed, engineered and tested in respect to the performances of the finished good (as it relates to the customer, efficiency along the supply chain, etc.).
Eye makeup, the largest product category for L’Oréal, has a share of about 18% of sales. Much of the share can likely be attributed to Maybelline New York, which offers more than 200 products. Known for its innovative, constant stream of mascaras, in 2009, the brand introduced the first-to-mass vibrating mascara Pulse Perfection, for just $14.95.
Just as the shades for Maybelline New York’s creamy range of Color Sensational Lipcolors are grouped into four color families, so, too, is the packaging. Inspired by the New York skyline, sleek, luxurious cases are available in various shades of red, pink, plum and natural to emphasize the color inside, and make it easier to find your shade.
For the 2009 holiday season, Shu Uemura, known for combining art with beauty, teamed with fashion designer Tsumori Chisato for a makeup collection that embodied the spirit ofTokyo. “Wish Upon a Star” mixed Chisato’s playful style with the brand’s cutting edge look for a charming collection of artistic palettes.
Prestige Choices
Perhaps no brand has done more for L’Oréal’s share in the premium cosmetics market than its 2007 acquisition of Yves Saint Laurent Beauté. While the newly acquired brandboosted sales for L’Oréal in 2008, a report from Euromonitor warns that growth may now be threatened due to the current economic climate, in which consumers are transitioning to mass brands. At present, the brand is predominantly based in Western Europe (65%), followed by North America (16%). Euromonitor suggests that L’Oréal can minimize any risks by successfully expanding the YSL brand to emerging markets.
Still, it seems that YSL products will always have a place for consumers looking for a beauty treat. YSL Beauté describes luxury. It starts with the richness of the package: shiny gold, like fine jewelry, emblazoned with just a touch of color in the red and black blocks that in turn, highlight the easily recognizable YSL signature logo. Pick it up, and you can’t help but notice the weightiness—not only a sign of quality but a signal to expect something noteworthy inside. This describes the case for Your Lovely Palette ($75). Lift the substantial black cardboard flap inside the carton, and you’ll glimpse what looks to be a black patent leather watchband with a gold buckle. Pull the strap and find it attached to a weighty gold case in the shape of a couture-like luggage tag, detailed with a heart and the Yves Saint Laurent name embossed on the cover. Lift the cover to find a gold-framed mirror, two complementary lip or eye colors and a tiny brush with the YSL logo engraved in the handle.
YSL’s Rouge Volupte lipstick flaunts a similar glamour and surprise touches. A small, round mirror adorns the top of the gold cap, so there’s no need to carry a separate mirror for on-the-go touchups. A band around the center of the case features repeats of the YSL logo atop a color band, similar to a couturier touch—or a carved cameo revealing the color beneath—with layers of delicate lace atop solid color fabric. A true piece of luxury for less than $35, it comes in a variety of 18 shades, and is definitely worth it.
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To embrace his signature women’s fragrance, Giorgio Armani, inspired by the Art Deco designs of the 1930s, created a sphere of crystalline glass, with side halos of fine circular waves, echoing the central O of Idole. A gold cap, like a piece of jewelry, adorns the bottle. |
Fragrant Releases
L’Oréal may be widely recognized as the world’s No. 1 cosmetics company, but what may seem surprising to some is that the distinction includes its ranking as No. 1 in fragrance—ahead of Coty and P&G, according to data from Euromonitor. New fragrances, such as Lancôme Magnifique, according to Euromonitor, served to create excitement among consumers in 2009.
YSL Beauté’s fragrance offering was also on target in 2009 with the launch ofParisienne, promoted by supermodel Kate Moss. The flacon is intricately carved to represent a labyrinth of Parisian streets, and colored to resemble the pale pink of early morning. The YSL signature is stamped in gold on a black leather label and capped wth a golden dome.
Ralph Lauren returned to a classic in 2009, releasing Ralph Lauren Always Yours, a new chapter following the original Romance fragrance, which celebrated its 10th anniversary. The Limited edition parfum features a delicately handcrafted glass dauber, faceted in the spirit of a diamond, the modern symbol of love and the traditional gift for 10 years of marriage.
For men, Ralph Lauren launched a new variation of Polo Red, White & Blue. The packaging takes its cues from the colors of the American flag and Ralph Lauren’s heritage as a prominent American designer. The sleek blue bottle is accented by polished red and white diagonal racing stripes, an oversized gold polo player icon and a gold-colored cap. The carton reflects the new look, and is topped by an image of the Ralph Lauren American flag. The embellishments maintain the Polo Blue tradition, yet bestow a special touch to personify the distinctive new fragrance.
Science of Skin Care
Facial treatments are L’Oréal’s third largest channel, and perhaps no other category expresses as strongly L’Oréal’s masterful combination of science and packaging.
With several thousand new formulas and more than 500 patents registered each year, and in the spirit of Schueller’s commitment to incorporating science in the development of cosmetics, L’Oréal claims leadership in research in the cosmetics industry.
Science to the max describes Lancôme’s recent launch of Génifique—its latest revolution in anti-aging skin care, based on cellular reprogramming. The company’s 10 years of research into the biological behavior of stem cells, which are responsible for skin and hair regeneration during aging, has provided insight into how to select the active ingredients that protect them. L’Oréal received seven patents for its work in this area.
Génifique Youth Activating Concentrate ($78) is considered to be a new category of product designed to be the foundation of a modern skin care routine. The sleek dropper bottle provides the perfect delivery system. Simply pump the top to fill the dropper with the exact amount of product needed. Pump the contents of the dropper onto the palm of your hand, warm the product, then apply to your face.
Dermocosmetic Treatments
La Roche-Posay falls into L’Oréal’s Dermo-cosmetics skin care category. Recommended by dermatologists worldwide, it offers adjunctive therapy, daily skin care products formulated with highly concentrated ingredients targeting every skin’s needs—and tested on sensitive skin. Its daily use products include formulations based on thermal spring water rich in selenium, a powerful antioxidant. Formulations are clinically proven for safety and efficacy. A number of products were launched in 2009, including several sunscreens. Anthelios 60 Ultra Light Sunscreen Fluid had particularly innovative packaging, not seen in suncare bottles, especially in the U.S.
A spokesperson for the brand explains the unique side dispenser, which also underscores L’Oréal’s efforts to keep packaging consistent throughout the world: “The international version of the bottle features the dispenser on the side, and so in order to have continuity, we adapted the look as well. Furthermore, the dispenser on the side versus the middle allows the fluid to dispense more evenly onto the hands.”
Skin Care Firsts
Kiehl’s is one of L’Oréal’s testaments to sustainability and an example of its dedication to creating a “greener” portfolio. Kiehl’s Acai Damage-Repairing Collection was the brand’s biggest skin care launch of 2009. All four products within the line are certified as organic products by Ecocert.In regards to packaging, this collection is the first-ever skin care range to receive gold standard cradle-to-cradle certification—producing the minimal amount of waste during the production process—from start to finish.
Most recently in skin care, L’Oréal Paris created a new brand in the cleansing market with the launch of Go 360 Clean, a four item line that includes a brand new applicator, which L’Oréal calls a scrublet. The rubbery cleansing device is attached directly to the package and can be removed for exfoliation purposes. “Slumdog Millionaire” star Freida Pinto has been named spokeswoman for the brand.
It’s All Worth It
Now in the 21st century, the L’Oréal adventure continues, loyal to its past and the convictions of its founder, but also eager to explore new horizons and change with the times, always keeping the combination of superior formulas and innovative packaging at the forefront.
“Yes,” affirms Pearlfisher’s Ford, “the design story is obviously strong, consistent, simple and effective. But the marketing story, and the strategy for building this business with both iconic and challenger brands, appears to be its most powerful and compelling driver and explains its phenomenal global success. Think L’Oréal—and think quality, innovation, diversity and excellence. It’s an undisputed global giant, but one that has tapped into the psyche of the individual. ‘Because we’re worth it,’ says it all.”
L’Oréal Celebrates Centenary
An international timeline looks at L’Oréal’s rich history and offers a glimpse as to what lies ahead.
1907
•The history of the company dates from 1907 when Eugène Schueller, a young French chemist, created the first synthetic hair dye. Eugène Schueller registered two names for his product: “Black and Gold”, a logical brand name for a hair colorant with black representing the spectrum of dark shades and gold the warm tones – a brand name which was however never used; “L’Aureale”, a name inspired by a hairstyle in fashion at the time called “L’Aureole” from the Latin aureola, golden crown and by extension a luminous and colored halo. A few months later the name was simplified to “L'Oréal” which interestingly has its roots from the Greek “Orea” which means beauty.
1908
•With just 120 Euros in his pocket, Eugène Schueller registered his company “The Societe Francaise de Teintures Inoffensives pour Cheveux”. He established the company in a two-bedroom apartment in rue d’Alger – the dining room was used as the demonstration room and the bedroom as the laboratory.Eugène Schueller did everything himself – he manufactured his products during the night, then sold them to Parisian hairdressers during the morning and delivered them in the afternoon.
1909
•Eugène Schueller gained the backing of an accountant from Epernay who loaned him 4000 Euros. This enabled Eugène Schueller to think on a larger scale - he moved the company which he renamed “L'Oréal” to a four bedroom apartment in the rue du Louvre, he recruited his first employee and he began to advertise his products via a trade journal “La Coiffure de Paris”.
1910
•Eugène Schueller soon began to export his products abroad – from 1910 L'Oréal products were sold in Austria and Italy – by 1914 an additional six markets had been added; Hungary, Germany, Belgium, Holland, Switzerland and Russia and by the 1920s sales had been extended to the Americas, Russia and the Far East.
1929
•During the twenties, fashion changed. Women started getting their hair cut. A short style required shape and, more importantly, color. L’Oréal responded to this need by creating Imédia Liquide.
1934
•Eugène Schueller recognized a huge potential for hygiene and toiletry products for the body and hair. He took over Monsavon and in 1934 launched Dop, the first mass-market shampoo without soap (which left traces on the hair). It became L’Oréal’s philosophy to make technological products available to the largest number of people.
1935
•L’Oréal launched the sun tan oil Ambre Solaire, which became very successful the following year as the French started to go on their first paid holidays and enjoy the pleasure of sunbathing.
1946
•L’Oréal launched Oréol, the first cold wave in Europe: a real revolution in the world of hairdressing and the life of its customers.
1951
•Régé-Color became hugely successful with hairdressers. It was the start of the coloring culture among the masses in France.
•L’Oréal began to commercialize its products in broader distribution channels.
1953
•The company Cosmair Inc. was created and became the exclusive licensee of the L’Oréal Group in the USA.Headquartered in New Jersey, it did not move to New York until 1965.
1960
•Elnett hairspray was launched. It was a technological breakthrough in the hairstyling market. Elnett contained certain polymers, which could be removed with light brushing while other products on the market at that time contained lacquer which was very difficult to remove.Today Elnett remains one of the most coveted products of hairstylists around the world.
1964
•Lancôme was acquired, which transported L’Oréal into the world of toiletries, make-up and perfume and gave it access to the selective channels of the perfume sector.
•L’Oréal took over Garnier.
1965
•Guy Laroche Perfumes were created. With the launch of Fidji, the L’Oréal Group became involved in the creation and development of perfumes for the first time.
1966
•L’Oréal introduces Preference, its first mass-market haircolor line.
1970
•L’Oréal acquires Biotherm.
1973
•L’Oreal take-over of the Synthélabo Pharmaceutical Laboratories.
•The Gemey brand was acquired.
•L’Oreal introduces the “Because I’m Worth It” ad campaign, which was created in the US.
1974
•Lancôme introduced in the US.
1975
•Equalia by Vichy was created, the first moisturizer based on an anti-dehydration mechanism. L’Oréal had already signed technical agreements with Vichy in 1954. This company was acquired outright in 1980.
1978
•Anais Anais perfume by Cacharel was launched.
1979
•C.I.R.D (Centre International de Recherches Dermatologiques) was created at Sofia-Antipolis, specializing in the treatment of skin problems and ageing.
1982
•Plénitude was launched, representing the entry of the L’Oreal Paris brand into skincare.Today Plénitude is known as Dermo-Expertise.
1984
•L’Oréal acquires Ralph Lauren Fragrances.
1986
•Niosome by Lancôme was launched. The niosomes, created and patented by the L’Oréal Group’s research division, are part of the liposome family.
1989
•Helena Rubinstein was acquired.
•Take-over of La Roche-Posay Pharmaceutical Laboratories, specialists in skin care.
1990
•Trésor, the iconic Lancôme women’s fragrance was launched.
1993
•Redken was acquired by L’Oréal, which manufactures and distributes products for professional hairdressers.
•Capital Soleil by Vichy, which contains the new filter Mexoryl SX, was launched.
1994
•Cosmair became a wholly-owned subsidiary of the L’Oréal Group.
1996
•The L’Oréal Group acquired the American mass-market make-up company, Maybelline.In the same year, L’Oréal bought the Chilean company, Unisa.One year before, the Group had taken over the company, Jade, in Germany within the same market. With these acquisitions, L’Oréal became the world leader in the mass-market make-up sector.
•L’Oréal brought together its cosmetic activities in Japan under one subsidiary, Nihon L’Oréal.
1998
•Soft Sheen Products, the American company, which specializes in ethnic hair products, was acquired by L’Oreal USA
•L’Oréal signed a partnership with UNESCO bringing to the forefront women’s fundamental role in research, notably in the life sciences.The program was called For Women in Science.
1999
•L'Oréal acquired Maybelline in Japan. As a result of the acquisition L'Oréal now had the world rights to Maybelline.
2000
•L’Oréal acquired Miss Ylang, the leading mass-market make-up company in Argentina
•L’Oréal acquired the US company Carson (the world leader in ethnic hair products).As well as Matrix (the number 1 brand in the American professional haircare market) and Kiehl's Since1851.
•L'Oréal acquired the shampoo brand Respons.
•Cosmair Inc. changes its name to L’Oréal USA.
2001
•L’Oréal acquires the US company BioMedic which specialized in skin care products to accompany dermatology and plastic surgery treatments.
•L’Oreal announces the acquisition of Colorama, the Brazilian mass-market make-up and shampoo brand.
•L'Oréal acquired a 35% interest in the Japanese company shu uemura.
2002
•L’Oréal and Dutch designers Viktor & Rolf enter into a partnership for the launch of new fragrances.
•L’Oréal acquired the US company ARTec, which markets hair care and hair color products for the professional salon industry.
2003
•L’Oréal entered Fortune Magazine’s annual All-Star list of the world’s 50 “Most Admired Companies.”
•L’Oréal inaugurated the first ethnic hair and skin research center in Chicago.The Institute was the first research center in the world uniquely dedicated to studying the skin and hair of different ethnic groups.
•L’Oréal joined the « Global Compact » an international sustainable development initiative launched by United Nations’ Secretary-General Kofi Annan in 2000.
•L’Oréal acquired the majority share in shu uemura Cosmetics Inc., the company that manufactures and markets shu uemura brand cosmetics in Japan (4 years after acquiring 35% of shu uemura’s Japanese operations and the international rights to the brand outside of Japan).
•The L’Oréal Group signed an agreement to acquire one of the top three skincare brands in China: Mininurse. At the time of acquisition, this mass-market brand was distributed throughout approximately 280 000 outlets across the country.
2004
•L’Oréal acquires the Chinese make-up and skincare brand Yue-Sai
•L’Oréal inaugurates a new manufacturing plant in Pune, India which has been especially conceived to apply the most stringent international regulations for quality and hygiene in cosmetics manufacturing
•A new agreement between the majority shareholders of L’Oréal for the absorption of the holding company Gesparal by L’Oréal. Upon completion of the transaction, the Bettencourt family and Nestlé become direct shareholders of L’Oréal. Mrs. Bettencourt remains the largest shareholder of L’Oréal
•L’Oreal receives the Diversity Best Practices Global Leadership Award which was accepted by Sir Lindsay Owen-Jones.
2005
•Sir Lindsay Owen-Jones received the Anti-DefamationLeague’s International Leadership Award in recognition of his career, community leadership, and commitment to diversity.
•Mexoryl approved in the US
•L’Oréal opens a research center in Pudong, China to support basic scientific research to understand the structure and behavior of Chinese hair and skin.
•L’Oréal acquires the US company, SkinCeuticals and integrates it into the Active Cosmetics Division.
2006
•L’Oreal acquires The Body Shop.Remaining a separate business within L’Oreal, it became the 7th largest brand with a distinct positioning in the high growth “naturally oriented” segment.It was the perfect fit with L’Oréal’s existing diverse portfolio of international brands with different cultural origins.
•Mexoryl gets FDA approval for use in the US.
2007
•L’Oréal acquires the US company PureOlogy, a luxury brand sold through hairdressers in the professional market.The products are uniquely developed for hair colorists to use and recommend to their clients.The brand is notable for its range of highly concentrated sulfate free shampoos.
2008
•After obtaining the necessary authorizations from all the competition authorities, L'Oréal and PPR signed a definitive agreement for the effective transfer of Yves Saint Laurent Beauté to L'Oréal.YSL Beauté was incorporated into the Luxury Products Division.
2009
•L’Oréal celebrates 100th anniversary
