An Examination of the Impact of the Credit Crunch on the Purchasing Habits of Women Related to Cosmetics, with Particular Reference to L’oreal Paris

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An examination of the impact of the Credit Crunch on the purchasing habits of women related to cosmetics, with particular reference to L’Oreal Paris.

Marina Doroshenko
Spring 2011
MSc International Marketing
Word Count: 16,140

Acknowledgments

I would like to express my sincere gratitude and appreciation to Prof. David Chapman and Dr. Maria Chapman and Thank them for their invaluable support, guidance and supervision throughout this undertaking.

I would also like to express my deep thanks to my former course leader Mark Godson and Elizabeth Lye, who is my present course leader, for their support and understanding, as well as my family and friends for their support and encouragement during this project.

Abstract

Title: An examination of the impact of the credit crunch on the purchasing habits of women related to cosmetics, with particular reference to L’Oreal Paris.

The aim of this dissertation was investigate to what extend economic down tern has influenced consumer buying behaviour, habits, brand perceptions and loyalty, and how did that effect the performance of the L'Oreal make-up brand. 

The literature review focuses on the critical analysis and academic concepts that reveal the complexity of the consumer behavior highlighting the important roles of different external and internal factors, like culture, environment, reference groups and brand name that influence consumer decision and purchasing processes.

The study is based on abductive research approach that combines qualitative and quantitative information that is derived from various secondary and primary sources available to the researcher. The academic resources were reviewed and the primary research information had been collected through observation, self-administered questionnaire and on-line survey involving female consumers of the make-up predominantly based Sheffield area. The Case Study was used to test the effects of the recession on L’Oreal brand’s performance and to evaluate the actions taken by the company towards sustaining their success over the tough economic conditions.

The research results reveal that the credit crunch had quite significant, but not necessarily negative effect on the consumer behavior, habits, attitudes, perception and loyalty. The same can be said about some businesses, as a case study on L’Oreal uncovered. The economic down turn has made the consumers more prudent in their buying behaviors and decisions, and at the same presented a number of new opportunities to the business i.e. L’Oreal.

The primary research findings also underpinned historically known fact, that when economic conditions get though women start ‘fighting off the blues’ by treating themselves more to the ‘little luxuries’ like make-up. Many experts referred to such a phenomenon as a temporary fix that doesn’t solve the problems, but the findings prove that it definitely works!

Thus, women across the works will never give up their make-up. They will however, as the research reveals, adapt and re-adjust their shopping behavior and make-up habits (e.g.: by switching to a different brand) in a search for different solutions to still be able to afford looking and feeling good!

Although, the topic is not very original, this study contributes towards better understanding of consumers’ behavior, especially women in times of harsh economic conditions, towards buying cosmetics.

CONTENTS

• INTRODUCTION......................................................................................................1

1.1Background of the Study........................................................................................1 1.2Research...
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