1. Do a PRESTCOM analysis forL’Orea

1. Do a PRESTCOM analysis for
L’Oreal, drawing on the information given below.
2. Now do a SWOT analysis.
3. If you were a marketing consultant, what advice
would you give to a haircare company? Your suggestions
should be based on your analysis of
the case and they should all be explained and
justifi ed.
For some, choosing haircare products is simple.
After all, the point is to end up with clean hair, isn’t
it? So the cheapest shampoo will do. Other people
spend signifi cant amounts of time and money on their
haircare. They don’t just buy shampoo, but look for the
very best in conditioners, styling products and dyes.
After all, you wear your hair every day, don’t you? So
why wouldn’t you take at least as much time with it as
you do in choosing your clothes.
Fashions in hairstyles change as often as those in
clothing styles. Celebrity hairstyles can make the news
and attract as much comment as their clothes, bags
and shoes do. The fi lm and pop stars who make the
trends often have their own personal hairdressers on
hand, but most people cannot afford such luxury and
so they need help from gels, mousses and other miracle
products to make their curly hair poker straight or to
coax their straight hair into curls. Then, thanks to all that
frequent washing and blow-drying, their heat-damaged
hair needs yet more products to make it shine.
The fashionistas have added value to the haircare
sector but this market has been adversely affected
by changes in the economy. The fi rst decade of the
twenty-fi rst century has seen one of the deepest
recessions in living memory. Many jobs have been
lost, pay packets have shrunk and people have had
to give up some of their luxuries, e.g. trips to the hairdresser.
Shampoo is an essential purchase for most
people but shoppers have been buying own labels
and cheaper brands or value packs, or looking out for
price promotions. Clever shoppers wait for the promotions
and then stock up with their preferred brands.
Western Europe’s ageing population is another problem
for the haircare brands because older consumers
tend to wash their hair less frequently and use fewer
products. Conditioner sales have been even worse hit
than shampoos; some consumers have cut conditioning
from their haircare routine altogether. Women are
still far more likely to buy conditioner than men; just
over one-third of men use this type of product, compared
with three-quarters of women.
Manufacturers have also had to deal with increasing
consumer concern about the negative environmental
impact of haircare products which fi nd their way into
oceans and water supplies. Recycling of packaging is
also an issue.
Global demand for L’Oreal’s premium brands,
which include Lancôme and Kiehl’s, has fallen sharply.
Retailers have cut their orders and some manufacturers
have responded with lower prices to try to stimulate
sales. In an attempt to revitalise the market,
L’Oreal’s scientists are developing new products for
mass-market brands, such as Maybelline New York
and L’Oreal Paris.
In 2007, retail sales of shampoo and conditioner
reached £706 million, dropping to £700 million in 2008
and Mintel predicts they will fall further. Shampoo has
the biggest share of the market with sales of £391 million
in 2009.
Hairdressers have also been hit hard as women
visit them less often. Some of the premium haircare
brands have responded to this trend by launching
products with salon-fi nish quality or longer colour
maintenance benefi ts.
This is a highly segmented market presenting marketing
opportunities for a variety of differentiated products.
Shampoos are available for different hair types,
hair colours and hair lengths. Frizzy hair can be tamed
or thin hair volumised. Older hair can be rejuvenated
or children’s sensitive eyes protected from accidental
contact with shampoo. Combined shampoo and conditioner
products such as Elvive 2 in 1 were in decline
before the recession hit and manufacturers seem
to be phasing them out. L’Oreal still markets these
products to children and men, but has dropped them
from most of its adult women’s ranges. They tend to
be more popular among men who want convenience
rather than the more exotic benefi ts promised by so many female brands. Nivea have responded to this
need with Men Active 3: a combined shower gel,
shampoo and shaving foam.
Procter & Gamble is very strong in this sector with
a 36 per cent market share. Brands such as Head
& Shoulders and Herbal Essences are long-time
favourites with customers and P&G has continued to
innovate through the recession and has kept up its
advertising. It launched a new range of men’s haircare
products under its Gillette brand name and these are
building market share. Although women still spend
far more on haircare, there is a growing trend among
men, especially younger men, to purchase more
grooming products.
Johnson & Johnson is another key competitor.
Its strong brand positioning in babycare makes it
ideally placed to take advantage of opportunities
presented by the rising number of under 4-year-olds
in the UK.
Unilever has been pushing its Timotei brand,
launching variants including Golden Highlights, Soft
& Smooth and Strengthen & Shine. It also extended
its Dove brand with the addition of the Therapy
range, offering colour protection and intensive
conditioning.
Meanwhile L’Oreal cut its ad budget for the Garnier
Fructis brand and focused its attention instead on its
Elvive brand, possibly because of its purchase of The
Body Shop in 2006. Sales have dropped by almost 54
per cent since 2007, according to Mintel.

Kết quả (Klingon) 1:

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