Here Are The Key Drivers For L’Oreal’s Consumer Products Segment

-0.57%
Downside
95.31
Market
94.76
Trefis
LRLCY: L'Oreal logo
LRLCY
L'Oreal

L’Oreal’s Consumer Products division had been demonstrating lukewarm performance over the last few years. In 2015, this segment underperformed the overall industry growth. L’Oreal had been addressing this issue with the help of its acquisitions as well as strategic changes. Consequently, brands such as NYX and Maybelline have helped L’Oreal revive some of its growth in this segment. Hence, though slow, the growth did pick up in this segment towards the second half of 2015. Some of the strategies that L’Oreal has adopted to boost growth in the Consumer Products division are as follows:

  • The makeover of certain brands to cater to contemporary taste has resonated with individuals and hence resulted in the division’s growth. For example, Maybelline New York’s ‘Make it happen‘ campaign aided the growth of the brand in the U.S. The L’Oreal Paris brand has also undergone a modernization of its image.
  • The management aims for the segment to outperform the market in the future. Towards that end the complementary product range, the innovative offerings, and the global roll out of the NYX brand is expected to help in the endeavor.
  • The haircare segment has also been strengthened with the help of brands like Elvive by L’Oreal Paris and Ultra Doux by Garnier.
  • The tremendous digital initiatives by the company will further help in the growth of this segment. Digital media such as the Makeup Genius app or the social media presence such as the NYX Professional Makeup model are some of the popular initiatives that are driving growth.

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Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
2) Figures mentioned are approximate values to help our readers remember the key concepts more intuitively. For precise figures, please refer to our complete analysis for L’Oreal