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

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L'Oreal

L’Oreal’s Professional Products division maintained its global leadership position last year and continued growing, though the worldwide market in this category was slow. The two markets that remained buoyant were the U.S. (~4% like-for-like growth) and Western Europe (~2% like-for-like growth) and L’Oreal’s two major categories under this division: hair care and hair color continued growing.

Professional product growth

(Image Source: L’Oreal’s Annual Report)

Some of the strategies that L’Oreal has adopted to boost growth in the Professional Products division are as follows:

  • Redken has become the second largest brand in L’Oreal’s Professional division and it received huge success in the U.S. Redken is also L’Oreal’s best in class brand in the digital medium and the brand launched several technological innovations and continued excelling in providing users with customized services. The brand displayed around 9% like-for-like growth.
  •  Since the Professional products are mostly used in salons and spas, L’Oreal’s trained around 700,000 hairdressers in 2015 in order to effectively use its products.
  • L’Oreal’s Kerastase brand has started providing personalized recommendations for consumers in select outlets such as travel retail after a thorough diagnosis by professional hairdressers.
  • L’Oreal’s approach to keep upgrading the division so that it keeps up with the changing trends of the contemporary times has been one of its success mantras. For example, last year it launched Salon E-motion–a program aimed to support hairstylists while improving the customer experience in the salon  by helping the former connect with the users in a better way.
  • L’Oreal’s Professional division’s biggest secret for growth is continuous innovation and the company will continue on that path in the future as well.

L’Oreal currently has around 19% share in the global haircare market, which we expect to shoot above 22% by the end of our forecast period.

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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