L'oreal Case Study

1. SWOT Analysis:

L'Oreal Netherlands marketing manager was considering introducing the new product lines of Garnier Family brand in skin care product lines called Synergie and in hair coloring product lines called Belle Couleur. Accordingly the below SWOT analysis is needed:

1. Strengths:

• Both products are successful in France.
• Synergie has a differential advantage, because it is made of natural ingredients.
• Belle Couleur is the market leader in France for about two decades.
• Dutch Consumers are loyal.

1. Weaknesses:

• Market Share is very small compared to EU (4%).
• Garnier brand awareness is weak in Netherland.
• Dutch women aren't familiar with technical product descriptions, which is part of the current position statement that Synergie provides.
• Almost 50% of the 5 million Dutch women between the ages of 15 and 65 used traditional skin care products.
• Retail shelf spaces are very limited.

1. Opportunities:

• High promotions build brand awareness among Dutch consumers.
• The number of Dutch women working outside of the home is increasing.
• Skin care and hair coloring markets have potential as the annual volume growth rate is 12% and 15% respectively.
• Dutch women are increasingly interested in products with natural ingredients.
• Attachment to a certain product only becomes stronger with age
• New product line should reach the young consumer who will only grow increasingly loyal as they grow older.
• Distributors’ acceptance mainly is based on Evidence of consumer acceptance and Manufacturer advertising and promotion.

1. Threats:

• Dutch Consumers are loyal.
• Strong Competition for both products in the market.
• Any innovative products or new product variations in a line could be quickly copied.
• Retailers could develop and introduce their own private labels in 4 months.
• Test markets are being monitored and new product could be introduced before test period ends.
• Damage of brand image.
• Consumers perceived permanent hair color as a very risky product.
• Distributors’ acceptance mainly is based on Evidence of consumer acceptance and Manufacturer advertising and promotion.
• Drug chains and supermarkets required a brand with high customer awareness and some brand preference.

1. Problem Identification:

L'Oreal Netherlands marketing manager is performing an analysis, to decide whether to introduce one, both or no one of the new product lines of Garnier Family brand in skin care (Synergie) and in hair coloring product lines (Belle Couleur) in the Dutch Market.