L'Oreal Nederland B.V.: Product Introduction

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Case Study Analysis

Prepared by

Supervised by
Mr.

Year
2009-2010

Case synopsis
L'Oreal headquarter is in France and require from their subsidiaries around 100 countries to introduce two or more from their product within the few years. L'oreal Netherland director faces two difficult decision whether to introduce Synergie the skin care product and Belle Couleur hair product or one of them. If they introduce them in the Dutch market what will happen for their product from the same company that may compete them or take the force sale of their product in the market.

L'Oreal presently offers the following products in the Netherlands: Plenitude and Recital under the L'Oreal brand name, and Ambre Solaire under the Garnier Institute brand name. L'Oreal Nederland director has been considering whether to introduce the Synergie skin care line and Belle Couleur hair colorants line into the Netherlands. Synergie and Belle Couleur are marketed under the Garnier Institute name in France. •The marketing manager of L'oreal Nederland is wondering

If they go ahead with an introduction they will need to develop marketing program for the products line. L'Oreal Nederland already sell other brands of L'Oreal products in the market. If they introduce Garnier what will happen to them. •They have done extensive marketing research on consumer reactions to Synergie and Belle Couleurs and they are going back to the top management with their recommendations. •Dutch consumers had little, if any, awareness or knowledge of Garnier and had not formed a brand image. The Garnier sunscreen was a new product and few Dutch women knew of the brand. It was, therefore, very important that any new Garnier products launched in the Netherlands have a strong concept and high market potential. To accomplish this the products needed to offer unique, desired, and identifiable differential advantages to Dutch consumers. Products without such an edge were at a competitive disadvantage, and would be likely not only to fail but also to create a negative association with the Garnier name, causing potential problems for future . •Forty percent of the Dutch population was under 23years old and the consumers of this group are the heaviest for cosmetics. Also Dutch population was aging and fast-growing segment were the 25 or older group.

Issues

headquarters would like to introduce more Garnier product lines into Dutch market over the next few years. •Dutch consumers had little, if any, awareness or knowledge of Garnier and had not formed a brand image. The Garnier sunscreen was a new product and few Dutch women knew of the brand.

Introduction of Garnier products will impact L'Oreal products. •Products without such an edge were at a competitive disadvantage, and would be likely not only to fail but also to create a negative association with the Garnier name, causing potential problems for future. •Any innovative products or new product variations in a line could be quickly copied. •establishing a new brand was especially difficult since Dutch women typically purchased facial creams only once or twice a year. Dutch women were showing an increasing interest in products with “natural” ingredients, but they were not as familiar as the French with technical product descriptions and terms. •Belle Couleur is formulated towards darker shades and Dutch women prefer naturally lighter hair colors. and L'Oreal unwilling to change the formulation since all research centered in Franc. •Concern about the development of chains with their central buying offices, and the proliferation of new brands with little differentiation from brands currently on the market. •Concern the retailers need for shelf space for the new products line.

Alternatives
Course of ActionProsCons
1.Redesign the packing under one name for both product "L'oreal" from the Garnier institute
Will repeat the Garnier name twice and increase the brand...
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