French brand L'Oréal SA is the world's largest cosmetics company that has adapted to different cultures through careful research of their target market. Furthermore, the company is known for its diversity with excellent corporate environments across different regional offices.
How They Started
The company name comes from Oréale, which is a formula for hair dye developed in 1909 by a French-German chemist named Eugène Paul Louis Schueller. After making hair dyes, he sold them to hairdressers in Paris before deciding to register his business as the Safe French Hair Dyeing Company or the Société Française de Teintures Inoffensives pour Cheveux.
From using three chemists in 1920, but increased to 100 after 30 years. Thirty-four years later, the company has 1.000 chemists on its payroll. Today, L'Oréal's research and development department employs approximately 82.000 chemists.
From hair dye products, L'Oréal soon developed beauty and cleaning products. The company continues to innovate and now has more than 500 different brands and thousands of different products that cater to the beauty business – from styling formulas to curling, skin care and beauty solutions. body, perfume, makeup and cleanser. Over the years, the company has launched product lines ranging from products that can be used by consumers at home, through hair and beauty salons to professional and luxury product lines. important. L'Oréal has also acquired various companies to make itself a giant in the cosmetics industry.
The company is a leader in worldwide business as well as gender equality in the workplace. According to their company website, female employees make up 69% of the L'Oréal workforce globally. Women hold executive and management positions as well as other key positions within the company.
L’Oréal takes this very seriously, adhering to equal standards and strict policies for recruiting employees. In 29 countries, the company holds certifications such as European Gender Equality and International Standards (GEEIS) and Economic Benefits from Gender Equality (EDGE). In 2018, the Company received the top award as Europe's most gender-balanced company from Equileap. In the same year, Team L'Oréal was included in the 2018 Bloomberg Gender Equality Index and also received the CEO Leadership Award for Gender Equality from the United Nations.
Diversity is an inherent part of the company as many products cater to people from all continents. As a result, the company designs and markets a diverse set of products to suit the needs of different ethnic and social groups. They place value on people for their individual contributions, skills and qualities, that's why they don't hesitate to hire people with disabilities. In 2018, 1,117 people with disabilities were employed and they continue to encourage people with disabilities with working knowledge and capacity to join their workforce.
Furthermore, the Company believes in internationalization, but they want to emphasize that in their business, beauty is extremely diverse, which is the inspiration for their creativity and innovation. They wanted to meet the demand for products tailored to the specific beauty customs of local consumers. The Research and Innovation department creates products that will meet the requirements of every consumer, according to his or her habits and lifestyle.
How L'Oreal Adapts to Different Cultures
Part of L'Oréal's global marketing strategy is to have Research and Innovation departments in each region of the globe to research and analyze local consumers' demand for beauty products based on their character, local history, culture and traditions. They want to reach out to the diverse population of each locality, providing them with accessible, high quality products made to their own specifications.
Adaptability and Flexibility
Flexibility and adaptability are just two of L'Oréal's main strengths. Not only because of the economy, the company also considers acquiring more and more consumers globally as a human adventure. They must quickly deploy the company's assets - the management team, human relations, research, marketing, sales and production, to meet current needs.
L'Oréal adapts to different cultures through cross-cultural marketing or ethnic marketing, which means a company marketing to different audiences within a particular ethnic group. This type of marketing approach considers different consumer cultural references such as religion, ritual, tradition, and language. The company should be aware of consumer differences in beliefs, motives and perceptions. To succeed in cross-cultural marketing, companies need to identify, understand, and respect cultural differences. They use these differences to create ways to communicate and tailor their products to local market requirements.
As L'Oréal says, there is no uniformity when it comes to serving national and regional markets. Brands should adapt their business models, services and products to specific market conditions.
Working Groups and Product Adaptability
Local responsiveness and global integration require understanding complex information to come up with innovative products and market them accordingly. Product creators and marketing and sales teams should have institutional and cultural norms as well as language for understanding the market, which requires precise interpersonal coordination.
L'Oréal understands this very well, which is why they have an extensive portfolio of different brands for different cultures. They have Shu Uemura for Japanese lines, Giorgio Armani for Italy, Body Shop for the UK (sold to Natura Cosméticos) and SoftSheen-Carson, Kiehl, and Maybelline for the US market. They cater to the French market with Lancôme, Garnier and L'Oréal Paris.
The company also maintains offices in more than 130 countries, with more than half of its sales coming from emerging countries such as the Middle East, Africa and the Asia Pacific region. And the company has maintained its leading position in hair dye, makeup and skin care.
Good Management Team
L'Oréal's phenomenal global success depends on its management team, which is rooted in the company's original culture. Since the company started, the company has only employed French CEOs. Few senior executives come from other countries.
However, as a global company, L'Oréal has a number of cross-cultural teams of professionals for product development, which is key to maintaining a competitive edge.
Maintaining Global and Local Balance
L'Oréal responds to the size and scope of the global economies where their core consumer products are concerned. Likewise, they must respond to local market preferences. The company had to sell the L'Oréal Paris brand to mass markets worldwide. At the same time, the company launches new products every year to maintain market share and keep competition from many competitors, such as P&G, Unilever, Revlon and Estée Lauder.
To do so, L'Oréal spends more time than its competitors in research and development. While facing and overcoming those challenges, companies must consider the integrity of their products. L'Oréal must maintain its position as a global icon of sophistication and fashion, presenting an ideal image of its customers.
Excellent International Product Development Team
L'Oréal solved the dilemma of having top French executives, administrators and senior managers by hiring global middle management teams. The team is multicultural, and recruits the right teams by looking at individual managers familiar with the behaviors and norms of people from different ethnic backgrounds.
Most of them are on the product development team where they work on different product concepts. The right cooperation, exchange of ideas and communication make this system work. Product development takes about a year to complete before the teams present the new product concept at their annual Réunion Internationale.
Team members spend about a year in product development training before they join management development programs in France. Nurturing their multicultural workforce ensures the company remains an industry leader. The exposure of teams in the region to different cultures and different cultural knowledge gives them many opportunities to create new products.
Positioning, Market Selection By Target And Market Segment
L'Oréal carefully analyzes the demographics of consumers in the creation of its products, to ensure that they are providing the right solutions for the exact goals. They use different marketing tactics, including segmentation, positioning, and targeted market selection to promote and sell their various product lines. For example, the brand Dark & Lovely is specifically for African consumers. The L'Oréal LUXE line caters to middle- and upper-class customers who see beauty as their identity.
Therefore, L'Oréal is positioned as an ethical cosmetics and beauty care company that respects differences in aspirations, desires and cultures.
L'Oréal has 34 consumer and professional brands including several product categories. The company has segmented the market, providing products to upper- and middle-class customers, many of whom are professionals.
Worldwide Distribution Channels
Due to the different product categories under the L'Oréal brand, the company uses different distribution channels to make the products accessible to different consumers. Depending on locality and market composition, L'Oréal products are available through wholesalers, retailers, grocery stores, pharmacies, duty free stores, supermarkets, and small retail stores. and online. The latter is one of the company's main distribution channels, accounting for a significant sales growth in recent years.
Above are some winning and successful strategies that show how L'Oreal adapts to different cultures.
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