L'Oreal Plenitude Case Study 1995
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L’Oreal of Paris Bringing “Class to Mass” with Plénitude
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Transcript of L'Oreal Plenitude Case Study 1995
L’Oreal of ParisBringing “Class to Mass” with Plénitude
Team Charlie
Paul MacDonald, Clint Ramesy, Taylor
Dalton, Alex Deckard
L’Oreal Introduction
“I am a modern woman,
who uses only premium quality,
technologically advanced
products”
Geographic Distribution of Revenue
Formula for Success
● Technologically Superior Products
● Concentrate Resources on Star Product
● Follow Golden Rule of Advertising:○ feature star product
○ provide technologically superior evidence
○ Executive woman, up to date and assertive
1987- Leader with 19.8% dollar share
Geographic Expansion
● 1988 Test Markets in ATL and DALo 14% market share in tests
● Introduce full line, 14 SKUs
● Copied French formula for success
Financial Problems
Dollar Market Size and Market Share
$309 Million Total Market $471 Million Total Market
Dollar Market Size and Market Share
$252 Million Total Market $328 Million Total Market
Consumer Perspective on Plénitude
● High Tech
● Expensive
● Department Store
Quality
● Crowded,
Confusing Package
● Skews Older
● Plénitude not
associated with
L’Oreal
Where do we want to be?
● Financials○ Improve the top-line
○ Get the bottom line moving
● U.S. Market○ Establish Secure Place
○ U.S. a major contributor to L’Oreal
○ Develop suitable skin care product for U.S.
Customers
Recommendation
● Tweak Star Product System
● Change Packaging
● Prune Product Mix
● Keep Premium Pricing Strategy
● Keep a Strong Focus on Treatment
Moisturizers
Sales Forecast
Sales Forecast
Plenitude Price Premium by Product Line
Which Markets are Growing?
Conclusion
Recommendations:
● Tweak Star Product System
● Change Packaging
● Prune Product Mix
● Keep Premium Pricing Strategy
● Keep a Strong Focus on Treatment
Moisturizers
Cleansers Price Comparison
Daily Moisturizers Price Comparison
Treatment Moisturizers Price Comparison
Sales Forecast
● Q1 1996 earnings up 32%
● Project 32% increased sales through the end
of 1996.
● Cost of goods sold will increase at 25% of
sales
Percent Revenue Product Type
