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Presentation Transcript

L'oreal tm case
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1. NETHERLANDS MARKETING STRATEGYAndrew Cecily Danielle David Ibrahim Jennifer Sameera Tim1
HUL

2. Increase Garniers brand presence in the Netherlands LOrals

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2. Increase Garniers brand presence in the Netherlands LOrals ObjectiveGarnier currently offers one product in the Dutch market... How can Garnier successfully grow market presence without negatively impacting LOrals current market share?2 3. Increase brand awareness for the Garnier family brandsMinimize cannibalization from the introduction of Garnier productsMeet the needs of the Dutch market3LOralsDecision Criteria 4. Short-run strategy (0-12 months) Launch GarnierSynergie skin care products Increase LOral Recitals distributionLong-term strategy (12-36 months) Develop improved products for LOral and Garnier Wait and see with Synergie anti-aging skin care line Develop products to better suit markets needsRecommendation4 5. Market analysisCompany analysisRecommendationImplementationRisk MitigationExpected ResultsConclusion5 6. Netherlands High per capita income and growing number of working women make this an attractive marketFastest growing population: Age 25 or older segmentIncreasing number of Dutch women working29% labor force participation for women (and growing)4th in per capita income but 6th in per capita spending on cosmetics and toiletriesPrice conscious6 7. Dutch Hair Colour Market Accurate results: a major value driver for Dutch womenVolume growing at an annual rate of 15%46% of Dutch Women used hair colorant (up from 27%)Brand loyalPreference for lighter shadesPermanent colorant (73%)Semi-permanent colorantsGrew from 12% to 27%Fashion
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drivenDemand for warmer shades7 8. Dutch Skin Care Market Demand for products with natural ingredients2ndlargest sector of Dutch cosmeticsVolume growth: 12%Sales growth: 16%2.5 million Dutch women aged 15 to 65 use skin care products Consumers are brand loyal:Performance mattersLoyalty increases with ageProducts heavily advertised and sold on the basis of brand imageMarket share determined by share of voiceIncreased interest in natural products8 9. Market analysisCompany analysisRecommendationImplementationRisk MitigationExpected ResultsConclusion9 10. Current International Position Strong showing for both LOral and GarnierLOREALGARNIERLargest cosmetics manufacturer worldwideSubsidiaries in over 100 countries$6.8 billion in sales (+12%)$417 million in profits (+14%)Sales breakdown:France: 24%Rest of Europe: 42%Independent operationBelle CouleurPermanent hair colorSuccessful in France for over two decadesMarket leaderSynergieSkin care productsSuccessfully launched in France 10 11. Current Position in Netherlands Low brand awareness for Garnier11Garnier Operates under same division as LOral Currently manages one brand in the sun screen categoryMinimal brand presenceLOral Brand is well perceived by Dutch consumersPlnitude: A mid-market, high quality skin care productRecital: A high-end, high quality hair colouring productRecital is losing market share due to aggressive distribution strategy, private-label brands and salon services

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System diagram 2

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12. Market analysisCompany analysisProduct linesRecommendationImplementationRisk MitigationExpected ResultsConclusion12 13. LOral Recital Declining market share due to increasingly competitive marketStrengths Current market leader with one-third of the marketWeaknesses No clear positioning statement Market share decreasing over the past two years No semi-permanent formulationTo protect current market share, LOralshould develop a semi-permanent formula for Recital to meet market demands13 14. LOral Plnitude Avoid cannibalization by new product in an increasingly competitive marketStrengths Reputation for high quality Anti-aging line appeals to older demographic Weaknesses Unclear differentiation Threat of cannibalization from SynergieTo differentiate Plnitudefrom Synergie, LOralshould emphasize its anti-aging benefits to women 35 years and older14 15. Garnier Belle Couleur Must be reformulated to meet the needs of the target marketStrengths Only product with a strong positioning statement Positioning statement resonates with Dutch womenWeaknesses Current colours are too dark for Dutch women Positioning statement is not consistent with results Buying intentions decreased after useBelle Couleur is unable to meet market needs; Garnier should delay its launch until product improvements are made15 16. GarnierSynergie Offers a unique value proposition to the target marketStrengths Buying intentions increased after use Different positioning

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from PlnitudeWeaknessesDutch market is very competitiveNeed to maintain share of voice to maintain market shareGarnier should launch Synergie skincarewithout anti-aging line and emphasize natural ingredients that are scientifically proven16 17. Market analysisCompany analysisRecommendationImplementationRisk MitigationExpected ResultsConclusion17 18. 18LOralsDecision Criteria Launch Synergie only 19. Market analysisCompany analysisRecommendationPositioning ImplementationRisk MitigationExpected ResultsConclusion19 20. Synergie will be positioned as high-performance, high-value skin care products for women aged 20-35ReliableNaturalSmart ChoiceSynergie is a worry-free, natural skincare line for young women who care about healthy skin.High ValueHigh PerformanceUnderstated20 21. Synergie and Plnitude will be positioned as high value for women 20 to 35 years oldPerformanceUpper EndMiddle/ ValueHighEllen BetrixSynergieYves RocherPlnitudeDr. vd HoogOil of OlazPriceHighLowNivea VisagePondsDead EndLower EndLow21 22. Synergie and Plnitude will be differentiated on the basis of ingredients and demographicsScience- MatureScienceScience-YouthPlnitudeEllen BetrixOil of OlazPondsAnti-AgingGeneral PurposeSynergieNivea VisageDr. vd HoogYves RocherNatural- MatureNatural-YouthNature22 23. Garnier will target the value-conscious segment with SynergieTarget

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consumer profile:Aged 20-35Recently graduated university and started workingHas tried multiple skin care brands with mixed results (not brand loyal)Looking for brand to use with consistent resultsValue and performance conscious but not brand focusedThinks natural ingredients are better for skinUnfamiliar with technical product descriptions and terms23 24. The positioning is aligned with capabilities, consumer needs and the competitive landscapeDutch Consumer NeedsGrowing consumer segment that is value conscious and cares about natural ingredientsCompetitive LandscapeNo direct competitor in high-value segmentSynergie PositioningSynergie is a worry-free, natural skincare line for young women who care about healthy skin.Company CapabilitiesAlliance of science and nature natural products that dont sacrifice performance24 25. Market analysisCompany analysisRecommendationImplementationRisk MitigationExpected ResultsConclusion25 26. 26Synergie Pricing Strategy Mid-range pricing will appeal to valueconscious target marketPerformanceMiddle/ ValueHighSynergiePlenitudeDr. vd HoogPriceOil of OlazLowSynergie should be priced below Plnitude to target younger demographicLow 27. 0-2 months4-12 months2-4 monthsPrepare Customize literature Train new hiresCreate a beauty buzzEducate target marketSell bundling option to retailersLaunch time!Free product trialsAdvertisements27Implementation Timeline Launching Synergie will require a high level of coordination. 132 28. Increase sales forceTraining period of two monthsDefine sales

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incentivesDistribution strategy:Leverage current distribution networkGrocery stores and chain drug stores in densely populated urban areasIncentivize retailers with LOral-Garnier bundling option 281Prepare for Synergie launch 29. 292Create a beauty buzzSecure optimal shelf spacePlace near PlnitudeFind the face of SynergieDutch celebrity spokeswoman Educate about benefits of natural ingredientsPR efforts with women`s magazines and local TV stations? 30. Free product samplesMass mailing to select neighbourhoodsLocal charity eventsProduct demonstrationsShopping malls located near distribution outletsOutdoor advertisingPublic transit, bus shelters, shopping malls303Launch time! 31. Market analysisCompany analysisRecommendationImplementationRisk MitigationExpected ResultsConclusion31 32. 32Risk Mitigation Differentiate Synergies position to maximize market shareCannibalization of Plnitude salesPosition Plnitude and Synergie for different target marketsEven with some cannibalization, overall LOral-Garnier market share will still increaseHighly competitive skin care marketFirst-mover advantage in high-quality, high-value natural segment gain share before others can enterEmphasis on natural positioning for Synergie increase reluctance to switch due to possible allergic reaction 33. 33Risk Mitigation Reformulate hair colour to better meet needs of marketDeclining market share for RecitalDevelop a clear positioning statement and build on position as current market leaderIntroduce semi-permanent

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formulation to meet market demandsLost opportunity for mid-range hair colourStill no competitors in the mid-range hair colour marketReformulate Belle Couleur to increase chance of successful launch in future 34. Market analysisCompany analysisRecommendationImplementationRisk MitigationExpected ResultsConclusion34 35. Expected Results Increase in LOral-Garnier market share and profitsSkin CareHair ColourDutch skin care market:2.5 million consumers56 million guilders10% market share for LOral-Garnier = 5.6 million guildersPlnitude 5%Synergie 5%35Permanenthair colour market:1.7 million consumers88 million guilders30% market share for Recital = 26 million guilders32 million guilders in revenue 2 million in profits

36. 36Metrics for Success Indirect metrics drive top- and bottom-line results 37. Market analysisCompany analysisRecommendationImplementationRisk MitigationExpected ResultsConclusion37 38. Recommendation Launch Synergie skin care products immediatelySynergie(Skin care products) Belle Couleur(Hair colour)Synergie(Cleansing products) Belle(Hair color)Target:Professional womenAge 20-35Price:Mid-range9.95-16.95Position:Natural ingredientsAffordable qualityPromotion:Free product samplesProduct demonstrationDistribution:Leverage LOrals existing networkExpected Results:10% increase in overall market share for LOral and Garnier combinedDarker shades not suitable for Dutch marketNegative feedback from test marketTrend towards semi-permanent hair colorantLaunch Cleansing

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test marketTrend towards semi-permanent hair colorantLaunch Cleansing productsDo not launch hair colorSynergie(Anti-aging products) Synergie(Skin care products) LOralsPlnitude promoted as anti-aging product40% of Dutch population under 25Only 3% of Dutch women use anti-aging productsDo not launch Anti-Aging products38 39. Questions39

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