This can only be achieved through a firm with extensive knowledge, experience and innovative strategies. To determine the strengths of the company potential, weaknesses, opportunities and threats, it is necessary to conduct an SWOT analysis by L’Oreal.
L’Oreal At A Glance – L’Oreal SWOT Analysis
Company: L’Oréal S.A.
Founders: Eugène Schueller
Year of establishment: 30 July 1909, Paris, France
CEO: Nicolas Hieronimus
Headquarters: Clichy, France
Employees (Dec 2020): 88,000
Ticker Symbol: LRLCY
Annual Revenue (Dec 2020): US$28 Billion
Profit net income (Dec 2020): US5.48 Billion
Products & Services: Beauty in skincare | Makeup | Hair care | Hair color
Company Website: www.loreal.com
Top L’Oreal Competitors
Competitors: Estee Lauder Companies | CHANEL | Unilever | Revlon | Edgewell Personal Care | MAC | Maybelline | Dior | Chanel | Urban Decay | Clinique | Lancome | Coty | Avon Products | Yatsen Holding | Beiersdorf
L’Oreal SWOT Analysis – SWOT Analysis Of L’Oreal
SWOT Analysis Of L’Oreal analyzes the brand based on its strengths weak points, weaknesses, opportunities, and threats. With L’Oreal SWOT Analysis it is clear that the advantages and disadvantages are internal factors, while threats and opportunities are external elements. Here we are going to talk about L’Oreal SWOT Analysis. Below Is The Detailed SWOT Analysis Of L’Oreal.
L’Oreal Strengths – L’Oreal SWOT Analysis
1. The largest beauty/ Cosmetics company: Without doubt, L’oreal is the biggest cosmetics as well as cosmetics firm in the globe. While other companies offer an collection of items focused on personal care and cosmetics, L’oreal as a company is entirely focused on products for Beauty and is the main reason for the incredible growth for the brand in the field.
2. Continuous R & D: When it is about cosmetics and beauty and cosmetics, pure manufacturing is not the best way to go. It is necessary to incorporate Dermatology cosmetology and cosmetology as well as hair care, skin care sun protection and other disciplines into it. The effect of a product in cold and hot weather will be different. This is why there are continuous R&D studies being conducted at L’oreal to make sure that their products are safe for customers as well as to keep looking to develop innovative products.
3. Amazing brand as well as branding portfolio: All the lines of products of those brands from L’oreal are all one after each other. In the same way that Garnier is focused on more sturdier hair and personal health, May belling is focused towards beauty. Both are top-quality brands in their respective fields. L’oreal has made sure every brand once it’s established, maintains the focus on its primary strength , which is what contributes to the strengths that are evident in L’Oreal’s SWOT analyses that is part of L’Oreal.
4. Quality of the products High quality of products: The image of a brand is created only when the customer purchases an item from the company and becomes pleased with the high-quality items and then purchases the same brand over and over repeatedly. There are a lot of die-hard customers of L’oreal Paris, May belling, Garnier, L’oreal Luxe brands Body Shops, and many other brands that are part of the L’oreal. If it’s the L’oreal brand you can confident you will receive a product that is exceptional and will be tested and checked.
5. A strong interconnected market communications Strong integrated marketing communications: Every brand within the L’oreal portfolio is renowned as a result of it’s multi-faceted marketing communications. These brands are not only known for their high-end advertising campaigns but they’re extremely effective at point of purchase marketing too.
6. Very good stars in the portfolio of brands The brand portfolio includes: Maybelline, Garnier and L’oreal Paris are three Stars (and could also be regarded as cash-cows) within the portfolio of brands of L’oreal. These brands contribute significantly towards the overall bottom line for L’oreal and assist other brands to stay alive and growing. Through the profits generated by these brands L’oreal can invest in and grow in its other brands and products.
7. Widespread Distribution: Since the brand is in over 130 countries, there is a wide distribution, which results in economics of scale and parting of fixed costs like factories, warehouses and other. Therefore, the price of the product is also monitored.
8. Natural as well as Organic in nature: One area where the cost of the brand suffers an affliction, but the place where the brand’s success is its choice to be 100% Natural as well as Organic in the natural world. From 1987 onwards, L’oreal has stopped animal testing completely. It is completely organic and natural in its nature and is therefore the ideal choice for those who love animals. If you didn’t know this, then there is yet another reason why you should choose L’Oreal over other brands.
L’Oreal Weaknesses – L’Oreal SWOT Analysis
1. Many sub divisions: managing such an enormous operation is never without problems and issues . This is the same with L’oreal. The company is known for being slow and bloated due to the many sub divisions it operates. Management of employees is also an issue in L’oreal because the company has around 60000 employees. Therefore, the human capital investment is enormous.
2. It is the haircare industry’s declining segment of the market: Garnier is one of the brands that is enduring the most from competition since it’s in the segment of hair care in which there is a lots of rivalry from HUL and P&G. Sunsilk comes from HUL, and the Head and Shoulders brand comes from P&G Both very dominant in the hair care industry.
3. Margins of profit are lower: higher investments in R&D organic processes, along with the enormous costs of distribution mean that the margins for profit of L’oreal are slightly less than other competitors. But, while this may have been a drawback but the R&D has made L’oreal among the leading names in the cosmetics sector therefore this flaw has to be taken with a pinch salt.
L’Oreal Opportunities – L’Oreal SWOT Analysis
1. Potential for market Potential for market: Potential for market – potential market potential of products for personal care and beauty is bound to grow. The world is vast and everywhere, the countries that aren’t developed are thriving and transforming into new market. The exploration of these markets will increase sales in the future line for L’oreal rather than remaining in the same market saturated with competition.
2. Expansion of the mix Expanding the product mix: The expansion of the range of products as well including new products into the mix of products will result in a complete expansion of the product mix which will be the goal of the L’oreal management and management.
3. The demand to use organic products; Since Peta as well as other animal rights activists have become active in the fight for animal rights, the demands for cosmetics made from organic ingredients are increasing. This is a good indicator for companies like L’oreal who have employed an organic methods for R&D from the beginning.
4. Rebirth of Body shop: Body shop is currently in an economic slump, and hasn’t developed into an online store. Its potential remains to be discovered. If you invest in rejuvenating this brand L’oreal could make its Body shop the preferred place for those who are looking to dress themselves out. It will be a one-stop shop for all things related about your appearance. However, it must be rehabilitated to be renewed in this direction.
L’Oreal Threats – L’Oreal SWOT Analysis
1. The dynamic nature of the cosmetics industry: With continuous improvement of this industry of beauty, staying up to date is extremely difficult. You can’t please everyone in one go, which seems to be the issue. In addition that the competition isn’t going to slack off and keeps inventing innovative strategies that they have developed of their own. This is why the constant change in the cosmetics industry is keeping the brand in high demand.
2. Cash crunch; A company such as L’oreal that has so many sub brands , must split the money it earns into a variety of segments. In the event that the economy is in decline, then it will face a major issue. Economic problems always exist in one nation or another and as a result of which, the flow of cash from the country ceases. This results in problems with the cash flow overall as well as the working capital management becomes challenging. The economy in general is in a state of decline, including European countries, as in Asian countries. This has led to an economic crunch for the company , and risk could be averted if the economy falls.
L’oreal SWOT Analysis Overview Template
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