L'Oréal: Bringing “Class to Mass” with Plenitude
L 'Oréal: BRINGING “CLASS TO MASS” WITH PLENITUDE
REPORT
Analysis and Recommendations on the Plénitude Strategy
Analysis of the Problem
Plenitude by L’Oreal was introduced to the US market in 1988. Eight years since its introduction, it has quickly become the #2 brand in the market only to lose it later to Pond’s. Plenitude also hit a four-year sales plateau and was still not making any money in the US market.
L’Oreal’s problems and root causes should first be identified and addressed. The root causes of L’Oreal’s problems are:
1. Wrong assumptions of the target market
2. Applying a market strategy based on the those assumptions
3. Continuing to do so for an extended period even given the results
The target market
When L’Oreal planned to release Plenitude in the US market, it is assumed that what would be successful for the French market would translate to the same success in the US market if the same formula was applied.
The model of an “executive woman” had mass appeal thus was so successful in France. However, as clearly shown later on in the market studies done in 1995, the market segments that attracted Plenitude the most was the “stressed out” and “age focused” segments which only made up 40% of the market. Also, the acceptor/rejector studies indicated that consumers perceived that Plenitude was specifically targeting older women.
Analysis of the “Dollar Shares” table combined with the “Moisturizer Units Sold” table (on page 309) shows that Plenitude actually leads in the “treatment” category. On the other hand, they are only third when it comes to the “daily” category (see appendix). This all contributes to the fact that Plenitude does not have the mass-market appeal which it needed for the “class of the mass” strategy to work. People viewed L’Oreal as a high-end, a step-up, more expensive and only for older women.
Evidently, consumer behavior in the US is different as compared to that in France. What would work in France would not
REPORT
Analysis and Recommendations on the Plénitude Strategy
Analysis of the Problem
Plenitude by L’Oreal was introduced to the US market in 1988. Eight years since its introduction, it has quickly become the #2 brand in the market only to lose it later to Pond’s. Plenitude also hit a four-year sales plateau and was still not making any money in the US market.
L’Oreal’s problems and root causes should first be identified and addressed. The root causes of L’Oreal’s problems are:
1. Wrong assumptions of the target market
2. Applying a market strategy based on the those assumptions
3. Continuing to do so for an extended period even given the results
The target market
When L’Oreal planned to release Plenitude in the US market, it is assumed that what would be successful for the French market would translate to the same success in the US market if the same formula was applied.
The model of an “executive woman” had mass appeal thus was so successful in France. However, as clearly shown later on in the market studies done in 1995, the market segments that attracted Plenitude the most was the “stressed out” and “age focused” segments which only made up 40% of the market. Also, the acceptor/rejector studies indicated that consumers perceived that Plenitude was specifically targeting older women.
Analysis of the “Dollar Shares” table combined with the “Moisturizer Units Sold” table (on page 309) shows that Plenitude actually leads in the “treatment” category. On the other hand, they are only third when it comes to the “daily” category (see appendix). This all contributes to the fact that Plenitude does not have the mass-market appeal which it needed for the “class of the mass” strategy to work. People viewed L’Oreal as a high-end, a step-up, more expensive and only for older women.
Evidently, consumer behavior in the US is different as compared to that in France. What would work in France would not