(PDF) Managing Marketing Report On L'oréal Group
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Added on 2021-01-02
(PDF) Managing Marketing Report On L'oréal Group
Added on 2021-01-02
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Business Strategy
Table of ContentsINTRODUCTION...........................................................................................................................1P1 Applying appropriate frameworks analyse the impact and influence of macroenvironmental factors on Loreal and its strategies......................................................................1TASK 2............................................................................................................................................3P2 Analyse the internal environment and capabilities of a given organisation using appropriateframeworks .................................................................................................................................3TASK 3............................................................................................................................................5P3 Porter's Five Forces Model for examining competitive environment....................................5TASK 4 ...........................................................................................................................................7P4 Strategic management plan for Loreal by including strategies, objectives and tactics..........7CONCLUSION..............................................................................................................................10REFERENCES .............................................................................................................................11
INTRODUCTIONIn order to sustain in this dynamic environment it is essential for the organisations todevelop effective business strategy so as to gain competitive advantage. Business Strategy refersto the actions and decisions taken to meet long term and short term objectives of the organisation(Acquaah, 2013). It allows the business to follow appropriate directions towards the attainmentof goals. The project is based on the Loreal company. It is a Multinational French companyspecialises in personal care products, headquartered in Clichy and has registered office in Paris.Its products mainly includes hair colour, skin care products, sun protection, make up productsand perfume and many more cosmetic products. The project will throw lights on the impact andinfluence of the various macro environmental factors on the organisation, it also evaluatesorganisations strengths and weakness and therefore determines capabilities and weakness amongthem. It also elaborates Porters five forces model in order to judge the competitive position of theindustry and applies models and concepts to determine strategic directions available to theorganisation. TASK 1P1 Applying appropriate frameworks analyse the impact and influence of macro environmentalfactors on Loreal and its strategiesPESTEL is a macro level tool which help the company to analyse the external factorswhich is impacting their organisation. It stands for political (impact of government and itspolicies on them), economical (impact of economy of the country on them), social (impact ofchange in trend on them ), technological (impact of technological and innovation),environmental(impact of climate, carbon footprints,waste),legal (impact of laws and legislation on them). Incontext of l'oreal this is how they are applying it into their business to know the external factorsthat are affecting them (AlsudiriAl-Karaghouli and Eldabi, 2013).Political- Company like l'oreal is working under the rules and policies of the the Francegovernment because its manufacturing unit is in Paris. Any political change in that country willimpact the company. By the globalisation, political factors are affecting the company's strategyin negative as well as positive way as when the brand globalise itself it has to follow the rules ofdifferent country which may be completely different from their own country. In this scenario thenegative impact is that it become very difficult for the company to manage them all because any1
political change will lead difficulties for the company. But this political factor also have positiveimpact and that is if the company follow the government of each country they can attractcustomers because people are conscious about brand affiliation with the government.Economical- It is related to the country's exchange rate in which the company isworking. Decrease in exchange rate will bring decline in production and sales of the company'sproduct. Like inflation rate of UK has increased and because of which purchasing power ofbuyers of UK has decreased which is causing negative impact on the company's sales andproduction. Development index is also considered as the economical factor for the l'oreal likedeveloped countries are buying more beauty products as compare to underdeveloped countriesso working in developed countries is positively impacting the company (Bharadwaj and et. al.,2013). This factor impacts the Loreal strategy as with the inflation consumers buying processdecreases which forces the respective company to decrease price of its products which is notpossible for high brand strategy and therefore affects business strategy. Social- These factors includes the social trend & belief among the people of the country.Countries with modern living standard have different taste and preferences from the others.Every country have different social factor like in UK disposable income of people is increasingwhich is causing changes in their habits and choices, people are preferring to buy morecosmetics and beauty products which leads to the change in their standard of living. This isputting positive impact on the company like l' oreal because of the high demand of theirproducts. But this rapid change in buyers behaviours is also causing negative impact on companyas their old products which are getting wasted because of new demands.Technological- It focuses on technology, research and innovation factor that is affectingthe company either positively or negatively. In case of l'oreal they has launched a veryinnovative technology for the make-up lovers named MKEUP GENIUS a beauty app. This apptransform the mobile or iPads camera into virtual mirror and users can virtually try product andcan judge according to their skin tone (Chang, 2016). This innovative technology of l'oreal haspositive impact on the company because it increases the sales of products and goodwill ofcompany. There are some more technologies that l'oreal has launched or is going to launch whichis making make-up lovers crazy. These technologies also have some negative impact on theirlife and that is by making them more addicted toward their mobile phones which is in reversecausing dangerous health issue in people.2
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