How Loreal become world largest beauty & cosmetic company

In 1907, Loreal was founded by a French chemist Eugene Schueller in his apartment's kitchen when he created his first hair dyer. He do all the work himself. Doing sales in the morning, delivery in the afternoon and production at night. Only until 1909, he hire his first employee.

How Loreal growth become a world largest company in beauty & cosmetic industry. Actually is via Merger & Acquisition ( M&A ).

In 1934, Loreal acquired a hair shampoo company Monsavon.
In 1935, Loreal launch it first sun protection product Ambrie Solaire.

In 1957, Frabcois Dalle become the 2nd CEO of the company when the founder pass away.

In 1963, Loreal become a public listed company in French and joint venture with Kose to venture into Japan market.

In 1964, Loreal acquired Lancome, this is first time Loreal enter into fragrance and perfume market. It also acquired Garnier, a hair care product.

In 1970, Loreal acquired Biotherm.

In 1973, Loreal acquired a German base Gemey and a pharmaceutical company Synthelabo Pharmaceutical Laboratories.

In 1983, Charles Zviak take over as 3rd CEO. The group R&D team has growth to 1,000 people.

In 1988, current CEO Lindsay Owen-Jones take over as it 4th CEO.

In 1989, Loreal acquired HR , and later La Roche-Posay. Before that, HR has alrealdy acquired Giorgio Armani fragrance and perfume division.

In 1993, It acquired another hair care product inUS, Redken.

In 1996, It acquired Maybelline and venture in to China market aggressively.

In 1998, It acquired a hair care product special for Black and African, SoftSheen Products.

In 2000, It acquired Carson, US haircare product Matrix, niche product Kiehl's and acquired 35% stake in Japanese Designer's brand Shu Uemura.

In 2002, Loreal join-venture with Nestle to form a companuy Inneov.

In 2003, It increase it shares in Shu Uemura to 52% and acquired a brand in China.

As you can see above, Loreal is a company that growth via Merger & Acquisition ( M&A )

Loreal new product under it own brand included Shine Delicieux lipstick.





Technorati Tag: Cosmetic : Beauty

Cleanser, toner & moisturizer

On Thursday, an article on the star stated that:

Ask any women and even if she is no beauty expert, she will probably be able to tell you that the basic formula for good skin involves cleansing, toning and moisturizing...........Made popular by Clinique. REALLY??

Biotherm, a brand acquired by L'Oreal in 1970. Unlike other traditional product that categories it product into hydrating product and whitening product. Biotherm categories it product base on your skin, Dry Skin, normal and combination and Oily Skin separate by Pink, Green and Blue colour respectively. It further categories into cleanser, toner and moisturizer.

Actually, 3 step formula of cleansing, toning and moisturizing was invented by Elizebert Arden.Whereas separation of skin into Dry Skin, normal and combination skin and oily skin was first introduce by Helena Rubinstein. A company under L'Oreal now.

Biotherm originated from mineral water. In the early of 19th century, a French biologist discover that mineral water under Pyrenees mountain in the southern part of French has "Thermal Plankton", a key to beautifully healthy skin, a potent skin rejuvenator. He apply intellectual property right on this discovery.

In 1952, founder of Biotherm acquired the IP right and used it in skin care product.

In 1970, L'Oreal acquired Biotherm and venture into Asia market in 1996. Being a late comer in Asia market, it target young people age between 20-29, It target body care product which is neglected by other brand and it also target Men's care segment.

On marketing strategy, Biotherm spend it major marketing budget on Direct Mailing. Usually, cosmetic company spend their marketing budget at the ratio of 4:1. Biotherm Direct Mailing Vs marketing ratio is 1:1. They selected Department Store loyal card holder age between 20-29, achieve certain spending target over last 3 months. Biotherm their brochure to those department's store loyal card holders. This targeted member received at least 3 brochure every year from Biotherm. Attract them to request sample product. Usually, cosmetic product's sample sets are 5ml. Biotherm give full sets of its product genereously.

As Biotherm give a lot of sample sets. It quickly build up it customer database. A customer database was build up base on respective identification number. Sales people would made follow up call after one week a person received a sample sets.

It quickly create a buzz among young people. Majority of Biotherm's new customer are recommended by friend, and this is the first time they buy skin care product. Thus, they have successfully attract first timer.......They bring in new customer to department store. After this incident, department store start allowing them to set up counter in their premises.

Later, Biotherm launch body care product and men's care product. Unexpected the market trend has change and slimming become a fashion. Sales of slimming product has been escalated. Even until now, slimming product comprise 1% of it turnover.

In Hong Kong, Biotherm breakeven in it first year. It become a top department store's brand in second year. In Korea, which people loyal to their own country brand. It rank no 7th .


Tag: Cosmetic : Beauty