L’Oreal Case Study

Problem Identification

There is a need to find out what product lines should be introduced into the Dutch market under the Garnier name without negatively effecting the current product lines already available under the L’Oreal brand. Recommendation

It would be feasible to introduce one of the new Garnier product lines rather then both of them at the same time. Because there is already a strong L’Oreal presence in the Netherlands it would hurt sales more if they introduced two new product lines at the same time.

Belle Couleur is the product to introduce because 73% of Dutch women use hair color products, and in recent years there has been large growth in the permanent hair color market which would make it viable to introduce Belle Couleur into the market. By offering a limited selection, Garnier products will still have sales, and it will not hurt sales of Recital enough to cause concern because people will still be receiving what they expect from the L’Oreal brand. Specifics of the Marketing Mix

Product: The hair color that is sold in the Netherlands should be specific to that regions taste, there is no reason to sell hair colors that people aren’t going to purchase, it will be a waste of shelf space because they could have more of what the consumer will purchase. 33% of women surveyed said they color their hair to achieve warm colors, and 17% say it is to achieve a lighter color. With this information, Garnier should concentrate their line on what is popular with the people they are trying to sell to.

Price: Belle Couleur should not enter the market as a cheap alternative to the other brands on the market, it should be somewhere in the middle price range. This way consumers will not see it as a cheap product and avoid it but they will see it as a viable alternative, and at least give it a chance. Also, it will not be in the same price range as L’Oreal’s hair color product because that is sold at a higher price.

Promotion: Since there is no real advertising position for consumer benefits from any of the competing brands, Garnier should make this product stand out

by offering the consumer the benefits that Belle Couleur has. Advertisements that show the benefits of using the Belle Couleur would work well because it would tell exactly what the product does without leaving the consumer guessing and asking questions.

Place: When they introduce the new line of hair color they should begin to sell it in independent drugstores because the consumer can ask questions to the sales associates. They should put the product into drug chains and food stores as well, but it should be made aware to the company that sales might not be as high in those areas because items sold in these locations tend to be brands with high customer awareness. Specifics of Customers Targeted

The target for Belle Couleur hair color should be the 73% of women in the Dutch market who use permanent hair color. Belle Couleur is priced so that it is not in the upper end or lower end of hair color products, so more specifically the target market would be someone who doesn’t want to pay too much for hair color but still wants the best possible results. First time users should be targeted as well, from the research done it shows that women are less likely to change products as they get older, so, if someone is a first time user it is likely they will stay with the Belle Couleur brand.

Specifics of Positioning StrategyKey features that should be focused on are that the product provides natural hair colors, which is commonly what Dutch women want. Also, the product should be positioned as something that will get rid of grey hair since 60% of the women who use hair color use it to cover up grey hair.

Specifics of Competitive StrategyCost: Belle Couleur should enter the market at a middle price range, this way the consumer will not see it as being cheap, and they will not see it as being too expensive to try for the first time.

Differentiation: Garnier should differentiate its Belle Couleur brand by giving concrete benefits the consumer will receive if they use the product. Since none of the other major competitors have a positioning statement saying what they offer it would be beneficial to Garnier to set themselves apart from the rest by giving reasons they should use their product rather then the other products.

Focus: Because this is a new product in the market their focus should be on getting women to try their product to see for themselves how good it is. They also need to focus on getting information out to the public that the product is good to use and it provides good results.