Loreal Strategic Analysis
Key Issues Facing L’oreal
Core Competencies
L’Oréal has created several core competencies that have created value and served to gives L’oreal a competitive advantage over it’s competitors.
Loreal’s first core competency is seen through it’s product innovation. L’oreal is fully dedicated to creating new and innovative products at it’s advanced dermatological research facilities. L’oreal invests heavily in research and development and aims to introduce one or two new products each year, every year in each of it’s world-wide markets. In fact, L’oreal annually invests 3 percent of its sales for research and new product creation. L’Oréal then regains this investment through the sales of its new globally launched products. This core competency is cstly for competitors to imitate and adds a lot of value. This focus on innovation ensures growth and helps L’oreal to have a huge competitive edge over its domestic rivals.
Another part of Loreal’s core competencies can be seen in L’oreal’s marketing campaign. By using high profile celebrities in it’s ad campaigns, L’oreal is able to greatly enhance its global image and is able to differentiate it’s products and brand name through the use of a celebrity face. This marketing technique gives L’oreal high brand esteem and gives L’oreal a valuable advantage over it;s competitors. Exclusive contracts with these celebrities gives L’oreal a non-substitutable competitive advantage. In addition, L’oreal uses web-enabled information and customization sites which further adds to it’s portfolio.
At the heart of L’Oréal’s core competencies is the level of diversification of it’s products. By offering several product lines including makeup, perfume, hair and skin products, L’oreal has created a big global brand name, which in turn, helps L’oreal to have superior brand recognition and esteem over competitors. L’Oréal’s strategy is to create unique products that catered to the beauty needs of different ethnic groups and to
Core Competencies
L’Oréal has created several core competencies that have created value and served to gives L’oreal a competitive advantage over it’s competitors.
Loreal’s first core competency is seen through it’s product innovation. L’oreal is fully dedicated to creating new and innovative products at it’s advanced dermatological research facilities. L’oreal invests heavily in research and development and aims to introduce one or two new products each year, every year in each of it’s world-wide markets. In fact, L’oreal annually invests 3 percent of its sales for research and new product creation. L’Oréal then regains this investment through the sales of its new globally launched products. This core competency is cstly for competitors to imitate and adds a lot of value. This focus on innovation ensures growth and helps L’oreal to have a huge competitive edge over its domestic rivals.
Another part of Loreal’s core competencies can be seen in L’oreal’s marketing campaign. By using high profile celebrities in it’s ad campaigns, L’oreal is able to greatly enhance its global image and is able to differentiate it’s products and brand name through the use of a celebrity face. This marketing technique gives L’oreal high brand esteem and gives L’oreal a valuable advantage over it;s competitors. Exclusive contracts with these celebrities gives L’oreal a non-substitutable competitive advantage. In addition, L’oreal uses web-enabled information and customization sites which further adds to it’s portfolio.
At the heart of L’Oréal’s core competencies is the level of diversification of it’s products. By offering several product lines including makeup, perfume, hair and skin products, L’oreal has created a big global brand name, which in turn, helps L’oreal to have superior brand recognition and esteem over competitors. L’Oréal’s strategy is to create unique products that catered to the beauty needs of different ethnic groups and to