SWOT Analysis of L'Oreal
SWOT: L’Oréal
Strengths
i) Innovation
L’Oréal is able to think outside the box. Its expansion through skin care device Clarisonic demonstrates its ability to venture outside regular product categories to drive growth.
Clarisonic drives growth in the stagnant North American market.
Clarisonic is one of the most successful stories in consumer appliances in recent times recording strong growth between 2007 and 2012. It has proved successful in the otherwise stagnant North American market. The product is available in department stores and direct channels. It has been strongly promoted by trade press and social media.
Clarisonic is placed at the premium tier and thus beyond the affordability range of many consumers particularly during the economic downturn. Despite this the product has experienced robust growth indicating the brand’s strong market potential.
While, through Clarisonic, L 'Oréal has demonstrated the ability to think outside the box it seems to be missing a rising trend in its immediate market. Consumers are showing greater health and environmental concerns leading to growing demand for natural/organic products, particularly in the skin care category.
ii) A well-segmented portfolio
L’Oréal has a well-segmented portfolio operating across different pricing tiers. This has helped L’Oréal to drive sales growth at economically challenging times.
L 'Oréal plans to expand Kiehl’s at 20%-lower pricing. 3
It is reported that L 'Oréal is planning to expand Kiehl’s in Western Europe. However, the concern is that the company has stated that it would reduce Kiehl’s pricing by 20%.
According to L 'Oréal the reason for slashing the prices is to align the brand’s pricing with the US market.
L 'Oréal has lost share to brands with natural positioning in Western Europe and to combat the competitive challenges it needs to enter this market segment without much delay. Since it lacks a
Strengths
i) Innovation
L’Oréal is able to think outside the box. Its expansion through skin care device Clarisonic demonstrates its ability to venture outside regular product categories to drive growth.
Clarisonic drives growth in the stagnant North American market.
Clarisonic is one of the most successful stories in consumer appliances in recent times recording strong growth between 2007 and 2012. It has proved successful in the otherwise stagnant North American market. The product is available in department stores and direct channels. It has been strongly promoted by trade press and social media.
Clarisonic is placed at the premium tier and thus beyond the affordability range of many consumers particularly during the economic downturn. Despite this the product has experienced robust growth indicating the brand’s strong market potential.
While, through Clarisonic, L 'Oréal has demonstrated the ability to think outside the box it seems to be missing a rising trend in its immediate market. Consumers are showing greater health and environmental concerns leading to growing demand for natural/organic products, particularly in the skin care category.
ii) A well-segmented portfolio
L’Oréal has a well-segmented portfolio operating across different pricing tiers. This has helped L’Oréal to drive sales growth at economically challenging times.
L 'Oréal plans to expand Kiehl’s at 20%-lower pricing. 3
It is reported that L 'Oréal is planning to expand Kiehl’s in Western Europe. However, the concern is that the company has stated that it would reduce Kiehl’s pricing by 20%.
According to L 'Oréal the reason for slashing the prices is to align the brand’s pricing with the US market.
L 'Oréal has lost share to brands with natural positioning in Western Europe and to combat the competitive challenges it needs to enter this market segment without much delay. Since it lacks a