Comprehensive Brand Management Report: L'Oreal's Marketing Approach

This report analyzes L'Oreal's brand management strategies, focusing on the importance of branding as a marketing tool and its evolution in business practices. It examines the key components of a successful brand strategy, including public relations, digital marketing, and social media, and how L'Oreal manages its brand equity through various initiatives. The report also explores the challenges faced in building a strong brand image, such as cultural differences and financial constraints. Furthermore, it discusses different strategies for portfolio management, brand hierarchy, and techniques for measuring and managing brand value. The analysis includes L'Oreal's specific branding techniques, such as Makeup.com and Makeup Genius, and how these contribute to its market success. The report concludes by highlighting the importance of brand loyalty, awareness, and perceived quality in building a strong brand, with a focus on the cosmetic industry and its impact on consumer behavior.

Brand management

Table of Contents
INTRODUCTION...........................................................................................................................1
SECTION 1......................................................................................................................................1
TASK 1............................................................................................................................................1
P1 Importance of branding as a marketing tool and how it has emerged with business
practices.......................................................................................................................................1
P2 Key components of successful brand strategy and managing brand equity..........................3
TASK 2............................................................................................................................................6
P3 Different strategies of portfolio management, brand hierarchy and brand equity
management................................................................................................................................6
SECTION 2......................................................................................................................................9
TASK 3............................................................................................................................................9
P4 How brands are managed collaboratively and in partnership................................................9
P5 Different types of techniques for measuring and managing brand value............................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
For a business, in context of profitability and revenues, a credible brand is a key of
success. A brand is a name symbol, design as well as intermixture of all of them that is conscious
in order to identify goods and services of one marketer or group of Sellers and to separate them
from market competition. Its a sum total of company's value as evidence by how it is deliver
these value at every point of contact. Hence, branded products are able to raise customers'
satisfaction level as it is very much important in marketing. It also assure better quality, easily
availability of goods and pricing stability to target audiences. Branding supports a firm to
accomplish its goals and objectives in a certain time period. L'oreal is the chosen organisation for
this present assignment, its a French personal care company. It is a world's ample cosmetic
company and formulated its actions in aura of skin care, perfume, make up, sun protection, hair
colour and hair-care. Apart from this, the report will be describe importance of branding in
emerging business practices. Readers will also come to know about key components of
successful brand strategy how to manage brand equity. At last, there will be discussion upon
diverse techniques in order to evaluate and pull off brand value of the company.
SECTION 1
TASK 1
P1 Importance of branding as a marketing tool and how it has emerged with business practices
Brand - Before understanding the term branding, readers firstly have to know about the
core concept of brand. A brand entails with a product or service which differentiate an
organisation to its rivals ; creating an effective brand assists both consumer as well as
manufacturer generates a win win situation for both parties. Along with this, brand provides legal
protection towards novel aspects or features of goods. Brand loyalty will contribute to retain
existing customers while diversifying one product line and it also renders security of demands
and creates barriers for other manufacturer in order to easily tap existing customer.
Branding - The term branding can be outlined as a process of building an unique name,
design, symbol, message or tag line among consumer’s mind with an aim of distinguishing it
from external rivals offerings and increasing loyalty. Branding helps differentiate products and
services of the organisation and make them worthy for customers. However, a brand represent a
firm's message and objectives that go beyond selling a product. An effective branding is able to
get customers' know about products' details and its usage; it also promotes recognition of
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business. Additionally, an attractive brand can make referrals or viral activity since individuals
love to educate others concerning the brands they like.
Branding strategy of LO'real - L'Oreal is a popular cosmetic brand among people
especially in women. The main brands of the firm are – Lancôme, Giorgio Armani, Yves Saint
Laurent Beauté, Biotherm, Ralph Lauren, Shu Uemura, Cacharel etc. The overall revenue of
L'Oreal is €26.024 billion and current operating income is €4.676 billion. There are overall
90000 employees are presently working with the company; it always focused on providing
innovative and worthy products to target audiences for obtaining maximum competitive edge
from target market. L’Oréal is one of the world’s top beauty brands as its total worth is $110
billion approximately. As the brand maintains its seat at the top through innovations in
technology, beauty and advertising. For example- introduction of L'Oréal's own particular site
Makeup.com uncovers magnificence tips, traps and items that can engage ladies to achieve their
optimal level of excellence. Its articles have simple to take after well ordered instructional
exercises joined by itemized pictures and recordings. Then again, L'Oréal made the first virtual
make up analyzer application named Makeup Genius. The application empowers ladies to
attempt different make-up looks progressively with the utilization of 300+ L'Oréal items. All
these marking techniques causes firm to remain effective in showcase rivalry.
Importance of branding as a marketing tool and emerging business practices: -
 Branding influence recognition – The most important logo in brand it its logo as if people
are aware about this, then it means branding has worked. Logo design of company must
be simple and enough powerful to affect customers' choice. Thus, effective branding
ensure that more and more get know about firm's offerings or products.
 Branding builds trust – It generates trust and credibility of people; it results customers
will get influence to purchase products and services. But to build individual's faith
management requires to generate qualitative or value added products which are able to
satisfy customers' needs and demands. A brand also communicates a culture of
reliableness that customers share with a brand; most importantly a brand builds trust of
its audiences.
 It provides employees' inspiration – A strong brand is able to attract people to work with
it; they feel proud to engage with that brand as well as try to accomplish organisational
goals and objectives.
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 Brands helps to launch new products – Strong products or brands sets a way for growth
and development of a business association. When people started to trust upon a brand, it
supports associations to add new product in their product line or even get into a different
area. L'Oreal may have begun off offering hair shading, yet because of awesome buyers'
reaction and confide in the brand, they grabbed up LO'real make up items, healthy skin
and antiperspirants when these new items were presented.
Differentiation between product and a brand: -
Product Brand
A product is made by firms and purchased by a
customer in exchange for money.
Whereas brands are created through
perceptions, expectations, and experiences of
consumers by all offerings which are involved
in a brand umbrella.
A product can be copied by competitors at
anytime.
Brands are unique and build by previous
experience of customers who buy them.
Main products of L'Oreal are – make up
Foundation, Lashes Mascara, Infallible Mono
Eyeshadow, Riche Nutri Shine Lipstick,
Titanium Nail Paint etc.
Main brands of L'Oreal are – Lancôme,
Giorgio Armani, Kiehl's, Biotherm, Yves Saint
Laurent Beauté, Ralph Lauren, Cacharel etc.
P2 Key components of successful brand strategy and managing brand equity
Brand equity – It is a set of brand assets and liabilities associated to the brand. It adds or
subtracts value of a products which are offered by a firm to its customers. Brand power means a
its power that is derivable from market good will and its name or fame which is earned by the a
company over time. In addition, it helps into maximum profitability and sales revenues in
comparison with competing brands. In simple terms, brand equity is a set of subordinates that
supprts a brand to pull in efficient volume then it would without brand name.
By considering L'Oreal, the firm manages its brand equity by making certain necessary
modifications in its existing strategies so as; it supports to boost up market value of the company.
Although, brand equity begins with unique style, thrilling messages as well as compelling picture
which driven up brand value. L’Oréal Paris is the most valuable cosmetics brand for the third
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consecutive year; the brand has reached a record value of US $13.7 billion. L'Oreal is located in
130 nations by having 32 international brand and it has registered with 500 patents.
Below is defined several key components to manage brand equity: -
Public relations – It is essential for multinational business associations, like – L'Oreal to
manage strong public relations by fulfilling its social responsibilities. In addition, companies
have to make their products as per customers' demands or taste. For this purpose, there must be
required to have provide positive working environment to manpower as they can work in
different strategies to accomplish vision and mission of the company.
Digital marketing - Building and developing the image and reputation of a brand at the
international level is essential to manage brand equity of various brands in the portfolio. In this
sense, the cosmetic giant communicates over the globe by using digital marketing channels, such
as- e-mail marketing, display advertising, content marketing, pay per click advertising etc. all
these channels assist firm to arrive large group of customers in a certain time period.
Social media – Social media marketing entails with process of gaining traffic or attention
through social sites, i.e. Facebook, Twitter, Instagram, Pinterest etc. Thus, it is a powerful way
for businesses to arrive to reach target audiences and manage brand equity. In addition, social
media often feeds into discover of new content and it supports to build link that in turn support
into SEO efforts.
Key elements of strong brand: -
Brand loyalty:- It is considered with repetitive purchasing behaviour of customers. If a
customer loyal towards a particular brand then he or she will continuously buy that specific
product. Along with this, brand loyalty is one of the crucial indicator while measuring brand
equity as it drives post purchases.
Brand awareness:- Awareness of a brand name between target audiences is a first step of
build equity. Basically, brand awareness means customers' know about the product or not.
Although, low level of consciousness reduces sales and profitability. Thus, to improve brand
awareness L'Oreal is focusing on making itself visible among target audience by various
promotional methods such as publicity, sponsorships, events, advertising, instigating word-of-
mouth promotion, etc.
Perceived quality – It is a perception of consumers' towards quality of goods and
services. While evaluating quality, customers' taken into account performance of a brand in
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different parameters, and then make judgements about quality by valuing competitors' offerings.
In addition, quality perceptions also affect pricing decisions as better quality products charges
premium prices.
Brand association:- Anything which aids to link customers memory about a brand is an
association. People creates associations based upon quality perceptions, interactions with staff
members, advertisement of the brand, price points on which a brand or product is sold, product
displays in retail shops, offerings of competitors etc.
Challenges are faced by firm to develop its brand image: -
Cultural differences – Each and every cultural has its own set of standards and customs
in which people live. Thus, it is fundamental for marketers to recognise about the cultural of the
nation or community in which it will serve. Sometime, due to cultural differences firms are not
able to meet needs and wants of customers. For example, westerns' believe that suntans are
attractive, youthful, and healthy whereas the southern's do not. These key differences apply to
labels and branding as well.
Increases global consumerism – In this modern era, there is a rapid change in
consumerism and demand of new products also arises. Along with this, consumers also willing
to know about brand as well as corporate transparency. They wish that firms get more socially,
eco-friendly as well as accountable towards societies in which they are performing. International
brand, i.e. L'Oreal percive as monolithic by having very little or no social responsibilities. It
affect brands image worldwide bad publicity and comment through global news networks and
anti-corporate websites.
Financial challenges – Funding is one of the biggest challenge face by during branding
which needs to be successful. A strong finance is required to do marketing or branding activities
at global context. Thus, a sensible budget needs to be formulated so as to branding because it is
significant consideration to increase sales.
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TASK 2
P3 Different strategies of portfolio management, brand hierarchy and brand equity management
L'Oreal is a largest group of cosmetic across the globe which is operating in 130
countries and it has brands in five major areas, i.e. salons, body shop, hairdressing, consumer
and luxury products. The firm works on its famous slogan, i.e. Because I am worth it. The brand
is known by all customers due to its effective brand recognition. In this sense, it is necessary for
the company to maintain their brand equity by implementing innovative strategies which aims is
to arrive more and more consumers.
Brand equity entails with additional value which attaches an individual with a particular
brand which is novel from others available substitutes in market. In simple terms, brand equity
is a goodwill which a brand has gained over a time. Although, brand equity can be measured
through evaluating a brand's earning potentials for long run.
Brand portfolio strategy of L'Oreal: -
Corporate brand – It seeks with connects the name of corporation while doing all
advertisements efforts in customers' mind. Corporate branding can be successful if customer hear
or see the name of the company. Companies those have strong corporate brand name can easily
advertise or promote themselves at sporting events, movies as well as on other products. In
addition, that name will instantly put a positive impact on customers without having a list of
product's features or latest innovations of the corporation.
Umbrella brand – It is also known as family branding, thus umbrella branding seeks with
merchandising practices that encompasses with selling goods or services by using a particular
brand name. In addition, concept of umbrella branding develops great brand equity for a brand or
product.
Endorsed Sub brand – An endorse sub brand is an intermixture of single and well-
defined product brand that are connected together under a endorsing parent brand. It plays an
accessory and linking role in order to improve brand image of the company. An endorse sub
brand can be succeed when it associated with family product which have shared high level
outlooks that is valued by target audiences.
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Product - A product is an item which is offered by a firm to its target audiences,
products can be in virtual or physical form. In addition, every product is made at a cost and sold
at certain price.
Management hierarchy of L'Oreal: - Umbrella brand - L’Oréal’s flotilla of brands is organised by Division, which each
develop a specific vision of beauty by consumption universe and distribution channel.
The main umbrella products of the company are – L'Oreal paris casting cream gloss,
intense instant smoothing serum, hair expertise,make products, skin care, shampoo,
condition, hair style etc. Endorse sub brands - The Oscar-winning actress will represent the beauty brand in the
UK, initially endorsing the Age Perfect anti aging range. Garnier, Maybelline, Nyx,
Essie, Dark Lovely etc. are the sub brands of L'Oreal. Products – The main products of L'Oreal are – casting crème gloss hair color, glam shine
balmy gloss lip crayon, infallible eye shadows, pearl perfect night cream, minerals
foundations, blendable foundation, color riche lipsticks, millions lashes mascara etc.
Management hierarchy of Lakme: - Umbrella brand - Lakme is one of the oldest, well-known cosmetics brand offering the
comprehensive range of make up and skincare products for women. The brand also
provides beauty services through its Lakme Beauty Salons and Studios. The umbrella
product list of the company are – Lakme Eyeconic kajal, curling mascara, complexion
care cream. Lakme perfect radiance intense whitening compact, Lakme enrich satin
lipstick range etc. Endorse sub brand – In order to promote itself, Lakme endorse various actress or
models. Recently, it is launched Baked Blush having four amazing shimmering shades.
 Product – The main products of Lakme are - Lakme CC Cream, Lakme Absolute
Illuminating Eye Shadow Palette, Lakme Absolute Kohl Ultimate, Eyeconic Mascara and
Eyeliner, Weightless Mousse Foundation, Lakme Absolute Lip Pout etc.
Brand equity of L'Oreal: -
Brand equity matters, because positive brands are profitable brands. Everything a
business does, and every interaction it makes with customers, represents a building block for that
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business’ brand. Over time, these actions build brand equity the significance and impact of the
brand’s name. L'Oréal Group has turned into the biggest makeup and magnificence organization
on the planet. In 2017, L'Oréal was the main individual care mark on the planet with a brand
esteem that added up to 23.89 billion U.S. dollars. Between 2015 to 2018, the organization's
compound yearly development rate expanded by 4.2 percent. L'Oréal Paris' shading corrective
dispatches – including Miss Manga mascara and two-advance Infallible Nail Polish – impelled
make-up to the main classification in the L'Oréal Consumer Products division.
CBBE model (Consumer Based Brand Equity) -
(Source: Keller’s Brand equity Model – CBBE Model by Keller, 2018)
The model of brand equity supports in better planning of marketing strategies which are
linked with working activities and practices. Thus, to get better product portfolio management is
necessary for building a strong brand value among customers. In this manner, formulating higher
customers' experiences of a product by positive thoughts, beliefs, opinions and perceptions. Brand Identity – It entails with customers' opinions towards a good or service of the
firm.
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Illustration 1: Consumer based brand equity model

 Brand Meaning – A strong brand name will supports to eradicate misunderstanding or
issues of buyers. Brand Response – People will judge a brand by considering its actual or perceived
quality. Thus, it refers with buyers' response for a product or brand.
 Brand Resonance – Any business association will attain brand resonance as if people
have strong or emotional relations with a brand.
SECTION 2
TASK 3
P4 How brands are managed collaboratively and in partnership
It is fundamental for every corporate association in order to manage its brand in an
imperative manner at national or international level. It results accomplishment of goals and
objectives in the best possible manner.
Brand Extension -
Brand Extension is an acquisition of pre-set up brand name or brand mark so as to sell its
new product categorises. The new aura in which a product or brand is going to be expanded is
linked with inconsequential with existing classifications. An effective or prestigious brand is
able to dispatch other products in new product categorises by using less marketing efforts.
Therefore, it can be said that brand equity acts as an imperative marketing strategy of the firm
under that a brand name is used to sell products in market, another business or some other entity
that is substantially different from the original.
L'Oreal has realised the need for caution in case of brand extensions; the firm takes this
decision after conducting an effective research. At the point when L'Oreal first uncovered its
L'Oreal Kids cleanser line mid 1998, retailers were wary. "Retailers say the esteem isn't there.
We say it is that the youngster builds up esteem. We were quite persevering." - said Carol
Hamilton, 45, senior VP-promoting for the L'Oreal retail division of Cosmair. L'Oreal experts
motorizes with L'Oreal proficient salons so as to advance their item as well as to enable
beauticians to have a dream, to exceed expectations and achieve.
On the other hand, Lakme was another beauty brand to launch its cosmetics which was
established in 1952 in order to fulfil the needs of women. In 1966, the company was no longer a
subsidiary of Tata group and they sold their stakes to Hindustan Unilever Limited. It also has its
own salons in major cities and has upcoming projects in tier 2 cities as well. This acts as an
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added advantage to the company’s profile. It also organises and sponsors the biggest fashion
show in India, “The Lakme Fashion Week” where leading designers showcase their designs. It
has products in all ranges and of the best quality. Through tremendous endorsements,
advertisements and innovations it has a large and loyal customer base.
Line extensions:
When a product is used to brand a new product that targets a new market segment within
a product category and existing served by the parent brand. L'Oreal is highly endowed in
managing its portfolio at global context as it covers all segments of customers. In addition, the
prime product line of L'Oreal is - hair care, colouring, skin care, make-up and perfume. In
which, Consumer Products Division offers the best in cosmetics innovation to the greatest
number of people on every continent. Along with this, firm's brand are easily avilable at in
markets, hypermarkets, medicines stores, general shops etc.
On the other hand, another famous brand of the company L'Oréal Luxe provides
cosmetics for both men and women across the world an array of prestigious and modern
international brands with a unique heritage. The brands of L’Oréal Luxe strive to promote the
different specialities of luxury beauty: skincare, make-up and fragrances.
Strategies and approaches of brand portfolio management: -
Current Products New Products
Current Market Market Penetration Product
Development
Strategy
New Market Market
Development
Strategy
Diversification
strategy
 Market penetration – Loreal tries to build its entrance of the market with a current item.
The objective is to expand its piece of the pie. It is the slightest dangerous system on the
grounds that the organization can utilize existing assets, procedures and limits.
 Market development- this includes hunting down extra market portions or locales. The
organization utilizes its current items and on the off chance that it figures out how to
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