NETHERLANDS MARKETING STRATEGY

1
Garnier currently offers one product in the Dutch
market...
How can Garnier successfully grow market presence
without negatively impacting LOrals current
market share?
LOrals Objective in the Netherlands is to
increase Garniers brand presence
2
Increase brand awareness for the Garnier
family brands
Minimize cannibalization from the
introduction of Garnier products
Meet the needs of the Dutch market
3
LOrals Decision Criteria
Short-run strategy (0-12 months)
Launch Garnier Synergie skin care products
Increase LOral Recitals distribution
Long-term strategy (12-36 months)
Develop improved products for LOral and Garnier
Wait and see with Synergie anti-aging skin care line
We recommend LOreal develop its products to
better suit the markets needs
4
Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
5
A high per capital income and growing number of women in
the workplace makes the Netherlands an attractive market
Fastest growing population:
Age 25 or older segment
Increasing number of Dutch
women working
29% labor force participation for
women (and growing)
4
th
in per capita income but 6
th
in per capita spending on
cosmetics and toiletries
Price conscious
6
Accurate colour results are a major value driver
for Dutch women
Volume growing at an annual
rate of 15%
46% of Dutch Women used
hair colorant (up from 27%)
Brand loyal
Preference for lighter shades
Permanent colorant (73%)
Semi-permanent colorants
Grew from 12% to 27%
Fashion driven
Demand for warmer shades
7
Dutch women care about natural ingredients in
their cosmetics and skin care products
2
nd
-largest sector of Dutch cosmetics
Volume growth: 12%
Sales growth: 16%
2.5 million Dutch women aged 15 to 65
use skin care products
Consumers are brand loyal:
Performance matters
Loyalty increases with age
Products heavily advertised and sold on
the basis of brand image
Market share determined by share of
voice
Increased interest in natural products
8
Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
9
Current International Position shows a strong
standing for both LOreal and Garnier
Largest cosmetics
manufacturer worldwide
Subsidiaries in over 100
countries
$6.8 billion in sales (+12%)
$417 million in profits
(+14%)
Sales breakdown:
France: 24%
Rest of Europe: 42%
LOREAL
Independent operation
Belle Couleur
Permanent hair color
Successful in France for
over two decades
Market leader
Synergie
Skin care products
Successfully launched in
France
GARNIER
10
Garniers Current Position in Netherlands suggests
low brand awareness
11
Garnier
LOral
Operates under same division as LOral
Currently manages one brand in the sun screen category
Minimal brand presence
Brand is well perceived by Dutch consumers
Plnitude: A mid-market, high quality skin care product
Recital: A high-end, high quality hair colouring product
Recital is losing market share due to aggressive distribution
strategy, private-label brands and salon services
Market analysis
Company analysis
Product lines
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
12
LOral Recitals declining market share can
explained by an increasingly competitive market
Strengths
Weaknesses
Current market leader with one-third of the market
No clear positioning statement
Market share decreasing over the past two years
No semi-permanent formulation
To protect current market share, LOral should develop a semi-
permanent formula for Recital to meet market demands
13
Avoiding cannibalizing by introducing a new
product: LOral Plnitude
Strengths
Weaknesses
Reputation for high quality
Anti-aging line appeals to older demographic
Unclear differentiation
Threat of cannibalization from Synergie
To differentiate Plnitude from Synergie, LOral should
emphasize its anti-aging benefits to women 35 years and older
14
Strengths
Weaknesses
Only product with a strong positioning statement
Positioning statement resonates with Dutch women
Current colours are too dark for Dutch women
Positioning statement is not consistent with results
Buying intentions decreased after use
Belle Couleur is unable to meet market needs; Garnier should
delay its launch until product improvements are made
15
Garnier Belle Couleur must be reformulated
to meet the needs of the target market
Strengths
Weaknesses
Buying intentions increased after use
Different positioning from Plnitude
Dutch market is very competitive
Need to maintain share of voice to maintain market
share
Garnier should launch Synergie skincare without anti-aging line
and emphasize natural ingredients that are scientifically proven
16
Garnier Synergie offers its target market a
unique value proposition
Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
17
18
Launch Belle
Couleur
Launch
Synergie
Launch Both Launch Neither
Increase Garniers
brand awareness
Minimizes threat of
cannibalization
Meets Dutch
market needs
LOrals Decision Criteria
Launch Synergie only
Market analysis
Company analysis
Recommendation
Positioning
Implementation
Risk Mitigation
Expected Results
Conclusion
19
Synergie will be positioned as high-performance,
high-value skin care products for women aged 20-35
Synergie is a worry-free, natural skincare
line for young women who care about
healthy skin.
Reliable Natural Smart Choice
High Value High Performance Understated
20
Synergie and Plnitude will be positioned as high
value for women 20 to 35 years old
Price
High Low
Performance
High
Low
Ponds
Nivea Visage
Yves Rocher
Ellen Betrix
Synergie
Plnitude
Dr. vd Hoog Oil of Olaz
Upper
End
Lower
End
Middle/
Value
Dead
End
21
Synergie and Plnitude will be differentiated on the
basis of ingredients and demographics
Anti-
Aging
Science
Ponds
Nivea Visage
Yves Rocher
Ellen Betrix
Synergie
Plnitude
Dr. vd Hoog
Oil of Olaz
Science-
Mature
Natural-
Youth
Science-
Youth
Natural-
Mature
General
Purpose
Nature
22
Garnier will target the value-conscious
segment with Synergie
Target consumer profile:
Aged 20-35
Recently graduated university and
started working
Has tried multiple skin care brands
with mixed results (not brand loyal)
Looking for brand to use with
consistent results
Value and performance conscious
but not brand focused
Thinks natural ingredients are better
for skin
Unfamiliar with technical product
descriptions and terms
23
Synergie Positioning
Synergie is a worry-free, natural
skincare line for young women who
care about healthy skin.
Dutch Consumer Needs
Growing consumer segment that is
value conscious and cares about
natural ingredients
Competitive Landscape
No direct competitor in high-
value segment
Company Capabilities
Alliance of science and nature natural products that dont
sacrifice performance
The positioning is aligned with capabilities, consumer
needs and the competitive landscape
24
Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
25
26
Low
Performance
High
Low
Synergie
Plenitude
Dr. vd Hoog
Oil of Olaz
Middle/
Value
Product Line Price
Dr. vd Hoog 10-11.95
Synergie (Garnier) 9.95-16.95
Oil of Olaz 12
Plnitude (LOral) 10.95-19.95
Price
Price the Synergie line in the mid-range to appeal to
its value-conscious target market
Synergie should be priced below Plnitude to target younger
demographic
0-2 months 2-4 months
Prepare
Customize literature
Train new hires
Create a beauty buzz
Educate target
market
Sell bundling option
to retailers
4-12 months
Launch time!
Free product trials
Advertisements
27
Launching Synergie will require a high level of
coordination between sales teams and distributors
1 2 3
Increase sales force
Training period of two months
Define sales incentives
Distribution strategy:
Leverage current distribution network
Grocery stores and chain drug stores in densely
populated urban areas
Incentivize retailers with LOral-Garnier bundling
option
28
1
Prepare for Synergie launch
Secure optimal shelf space
Place near Plnitude
Find the face of Synergie
Dutch celebrity spokeswoman
Educate about benefits of
natural ingredients
PR efforts with women`s
magazines and local TV
stations
29
2
Create a beauty buzz
Free product samples
Mass mailing to select neighbourhoods
Local charity events
Product demonstrations
Shopping malls located near distribution outlets
Outdoor advertising
Public transit, bus shelters, shopping malls
30
3
Launch time!
Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
31
Cannibalization
of Plnitude sales
Position Plnitude and Synergie for different target
markets
Even with some cannibalization, overall LOral-Garnier
market share will still increase
32
risk mitigation
Highly
competitive skin
care market
First-mover advantage in high-quality, high-value
natural segment gain share before others can enter
Emphasis on natural positioning for Synergie
increase reluctance to switch due to possible allergic
reaction
Declining market
share for Recital
Develop a clear positioning statement and build on
position as current market leader
Introduce semi-permanent formulation to meet
market demands
33
risk mitigation
Lost opportunity
for mid-range
hair colour
Still no competitors in the mid-range hair colour
market
Reformulate Belle Couleur to increase chance of
successful launch in future
Market analysis
Company analysis
Recommendation
Implementation
Risk Mitigation
Expected Results
Conclusion
34
Expected Results
Dutch skin care market:
2.5 million consumers
56 million guilders
10% market share for LOral-
Garnier = 5.6 million guilders
Plnitude 5%
Synergie 5%
Skin Care Hair Colour
Increase in LOral-Garnier market share and profits
35
32 million guilders in revenue 2 million in profits
Permanent hair colour market:
1.7 million consumers
88 million guilders
30% market share for Recital =
26 million guilders
Profitability
Revenue
Sales volume
Market share
Direct Metrics
Retailer penetration
Retail and wholesale margins
Market share versus share of voice
Brand awareness and consumer purchase intention
Indirect Metrics
36
Metrics for Success
Indirect metrics drive top- and bottom-line results
37
THANK YOU