The Strategic Planning Journey of The World’s Largest Cosmetic Company

L’ Oréal was founded in 1909, by a young chemist called Eugène Schueller. He started his business by selling an innovative hair dye patented by himself. In following few decades, L’ Oréal kept to expand its business in the beauty industry and had become the largest beauty products company in the world by 2013.

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In 2011, L’ Oréal wanted to make some new moves to revitalize its hair color lines. They realized that they had two big challenges. The “pull” challenge and the “push” challenge.

push-vs-pull

The “pull” challenge came from the consumer side. Getting a clear understanding of consumer insights is a very important step in every strategic planning. So L’ Oréal wanted to make sure that they could get a fast access to consumer insights through right channels.

According to their observation, social media and Google were two platforms or channels they could get data from. With the growth of social media, more and more consumers searched for information and engaged in conversations on platforms like Facebook and Twitter. At the same time, Google was getting maturer to offer consumer insights generation services thanks to its large database as the biggest search engine.

The insight that L’ Oréal wanted to know from consumers was what would be the new trend. Trend or fad is always a hard choice for businesses in the beauty and fashion industry. Pick the good one that finally becomes a trend, you win. Otherwise, if you invest a product which is finally proved to be a fad, you lost. So at that time, L’ Oréal wanted to decide which one to invest more money, ombre, tie-dye or splat hair.

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After deciding the channels they were going to use and realizing the problem they wanted to solve. They should come up with their goals and standards. How to use social media to identify new trends? What are the criteria? “ The team decided to conduct an analysis of social media data, including the videos and popular press articles. A secondary goal was to determine what added value the company could bring to the consumer.” ( From the HBR case)

When the data was collected and the insights were clear, the “push” challenge appeared. How to convert all the information into a marketing strategy?

There is a step that shouldn’t be forgotten. Competitor analysis. Many other competitors, at that time, used social media to interact with customers, make them engage and increase the brand awareness. So L’ Oréal also chose to integrate social media into their marketing strategy. The objectives were “ to create awareness, excite consumers about the new product, get them to try it, and create loyal advocates.” (From the case) Having the objectives, the only thing left was to create a campaign and push the new product.

Reference: Ombre, Tie-Dye, Splat Hair: Trends or Fads?–“Pull” and “push” Social Media Strategies at L’Oréal Paris

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One thought on “The Strategic Planning Journey of The World’s Largest Cosmetic Company

  1. I can tell you do your due diligence selecting and/or modifying the images you use so that they fit the aesthetic of your site, good job!

    Like

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