L'oreal Netherlands

Question 1: The skin care and hair colour markets are conservatively attractive for potential new products in the Netherlands, as it has been growing at an annual rate of 12% (skin care products) and 15% (hair colouring products). The threat of new entrants with differentiation was low, but barriers of entry were medium with little differences between products except for price. Buyer power was high with price sensitivity amongst the Dutch consumers, but this was softened by increasing sales. The intensity of rivalry is high in both markets, as there are many competing brands that fight for shelf space. (Porters 5 Forces of market entry).Personal care products are in a mature product life cycle in the Netherlands, and as such market entry is not that attractive, and should be based on product differentiation.

Question 2: There is no need to adapt the Synergie range, but the Belle Couleur range needs change to fit a lighter haired Dutch nation. As there is a growing market in Netherlands for semipermanent hair colour, L’Oreal should consider adapting their product for the semipermanent market. There is also a general trend towards warmer shades, and as Belle Couleur seems to be darker on Dutch hair, it can be positioned to fulfil the needs of younger people looking for warmer shades. As an alternative, Belle Couleur does not need to change their product, but has to change their packaging indicating the hair colour result as darker on the Dutch user compared to the French user.

Question 3: Introduce both products to a targeted market in the Netherlands that suits each line. Products should be positioned as middle market and value for money, accessible to the main stream and affordable luxury to the lower end of the market. L’Oreal needs to show differentiation with a clear advertising positioning statement, describing customer benefits and value offered. Synergies can be positioned as ‘nature and science working in harmony to prolong younger looking