L Oreal Business Model
L’Oréal is one of the largest beauty and personal care manufacturing companies in the world. It was founded by Eugene Schueller in 1909 and grew into a well-known French public company that is a part of Euro Stoxx 50 market index. L’Oréal is headquartered in Clichy, Hauts-de-Seine and operates in more than 130 countries (L’Oréal Annual Report 2014). 78,600 people work at L’Oréal. The company owns 32 well-known brands and 501 patents (L’Oréal Annual Report 2014). According to the statistics portal Statista.com (2015), L’Oréal’s brand value equals to 23.36 billion US dollars.
In 2014, L’Oréal’s sales equalled to 22.5 billion Euros. The sales can be divided in 4 categories: 7.7% - active cosmetics, 14.0% - professional products, 28.6% - L’Oréal Luxe and 49.7% - consumer
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In general, L’Oréal targets the women that are 18-35 years old as the most important group of customers. There is also a wide range of products that can satisfy the people with middle and high incomes. What is more, the company always faces the global-local tension and therefore needs to build such a brand portfolio that would satisfy the customers in different regions of the world. For, example it has French (L’Oréal Paris, Lancôme), American (Maybelline, Kiehl’s), British (The Body Shop), Japanese brands (Shu Uemura), etc (Hong & Doz, 2013).
The SWOT analysis of L’Oréal that will be presented further in this paper shows that L’Oréal has a very strong market position and is resilient to the changes in the global economy. There are a number of strengths that allow the company expand into the new foreign markets and react to the current trends. At the same time, the company faces a number of challenges such as slower rates of economic growth, increased competition with the local companies, etc. that harm L’Oréal’s business operations and
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