Loreal Strategic Analysis

1678 words 7 pages
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
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They could create a testing facility in Los Angeles where there is a large population of Hispanic people as they did with the African-American Research Laboratory in Chicago. There are many stores in Los Angeles such as La Curacao, a Hispanic pharmacy, which could help test some of the new Hispanic products to be integrated into the national market at some point in the future. L’Oreal could improve its marketing strategy and improve products for males as well. Research shows men are becoming increasingly concerned with their appearance and men's skin care product sales are growing. L'oreal should capitalize on this growing interest by creating a new line of men's skin care products. They could differentiate themselves further by conducting research in order to develop male skin care products that tailor to certain ethnic groups. This would fit into the company’s culture of seeing the world as a mosaic of cultures and gender.

Organizational Strategy Loreal’s organizational strategy has been the key to its international growth and success. With operations in over 130 countries and different products offered in each country, the structure and strategy of the Loreal group is what will determine their future. Carrying forward, the Loreal group should set up their organizational structure so that there is a good deal of control over the different product brands in different countries. Each brand name should have its own