Consumer Behaviour and Marketing Psychology Report: L'Oreal Analysis

This report provides a comprehensive analysis of L'Oreal's marketing strategies, focusing on consumer behavior and marketing psychology within the skin care industry. It begins with an executive summary and an overview of L'Oreal's products and market performance, highlighting its diverse brand portfolio and global presence. The report then delves into L'Oreal's communication mix strategy, examining how factors like consumer attitudes, group influence, and social class impact purchasing decisions. It analyzes advertising, discounts, promotions, and public relations efforts. Furthermore, the report assesses the strategic alignment of L'Oreal's skin care goods with its communication mix, identifying areas for improvement in understanding consumer behavior. The report concludes with strategic recommendations, emphasizing the importance of public relations, targeted marketing strategies for different consumer segments, and the use of influencers to enhance brand awareness and customer engagement. The analysis emphasizes the need for L'Oreal to better understand consumer psychology to improve customer satisfaction and organizational productivity.

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Consumer Behaviour and Marketing Psychology 1
Executive Summary
The objective of the below mentioned paper is to analyse the communication mix strategies of
L’Oreal for the skin care brands in the market. The paper elaborated the market performance of
the company along with the communication mix strategy currently implemented by L’Oreal for
target segment. The strategic alignment explains the ways in which the organization successfully
communicates their products and services to right type of customers in the market. The company
needs to improve the marketing strategy so as to effectively consider the consumer psychology
and implement it in the business. This would help the organization to increase the productivity
and satisfy the customers in a better. More details about the report are mentioned below:

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Contents
Overview of the product or service and its market performance.....................................................3
Communication Mix of L’Oreal......................................................................................................4
Strategic Alignment of Organization’s Strategy..............................................................................6
Strategic Recommendation..............................................................................................................8
References......................................................................................................................................10

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Analysis of product or service and market performance
L’Oreal being one of the most profound brands in the hair and skin care industry is working
efficiently to satisfy the consumer expectation. The company offer variety of products related to
hair and skin care in the worldwide environment. The company works with more than 500
brands working with them. Few brands of L’Oreal are highly famous and even compete with
own brand image of L’Oreal like Garnier, Maybelline etc. The hair care, hair style, skin care,
hair colour and makeup products offer wide differentiated range to both male and female in the
business environment (Widjaja 2015).
The company is a French personal care organization that works with intention to help every man
and woman in the world to embrace their unique beauty and innate the sense of self-worth. The
products of the company are well researched and formed using innovation and technology while
considering the interest of people. The company is world’s largest organization present in skin
and hair care industry. They offer products at different values in the market, like Maybelline,
Infallible Lipstick etc. are economic products while Lancome, Kiehl’s etc. are few premium
range products offered by the organization. The major focus of the products is to deliver value
proposition to the customer in response to the amount invested by them in the market.
Considering the performance of the organization in the worldwide market, it should be noted that
the brand value of the company amounted 23.89 billion US Dollar in the year 2017. Annual
growth of the organization in the worldwide cosmetic industry is 5.5% and skin care products
hold 37% share in the overall industry. The consolidated sales of the company in the previous
year accounted 26,937 million EUR. Being the largest retailer in the given industry, the company
earns loyalty of the customers and high profitability as well (Statista.com 2018).

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(Source: Statista.com 2018)
Communication Mix Strategy of L’Oreal
The communication mix strategy of L’Oreal is influenced by the factors affecting the customer
behaviour in the business environment. The previous assessment clearly explained that there are
several influences prevailing in the business environment that highly affect the decision making
activity of the customer like consumer attitude, group influence, social class etc. The attitude of
the buyer takes the biggest role in initiating the purchase decision in the competitive environment
(Karjaluoto, et. al., 2015). Some customers prefer trying new brands on a regular basis while
others show loyalty towards few brand, thus, the company has initiated the communication mix
strategy considering this behaviour of the customer.
Further, group influence is a major aspect that changes in the buying decision of the consumer.
For instance, people prefer using the products that their friends and colleague use. Therefore, this
factor highly motivates them to take the purchase decision in the environment. Lastly, social
class uplift the economic level of the customer and make them afford premium products in the
market also. Thus, it is should be noted that these factors are considered in the communication
mix strategy of L’Oreal (Alvarez-Milán, A., et. al., 2018).

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For the purpose of initiating the revenue for the organization, the business also implemented
segmentation and targeting strategy for the business. According to the demographic
segmentation, the business should target people belonging to both middle and high income level
people in the environment. They should target people who prefer to stick with the brand for a
long time if it suits them. Further, they also target middle and high income level segment
differently based on their expectation and quality of products that the business offer.
Below mentioned is the analysis of communication mix strategies that the company use to attract
the right type of customers in the worldwide market while determining their behaviour and
psychology for the products:
 Advertising: the company make use of advertising strategy in the market with an
objective to tap on the interest of customers in the environment. Through the advertising
strategy, the company focuses on creating an emotional connection with the customers
and attract them to initiate sales. The advertisement aims to trigger communication with
the customers so as to understand the impact of product and its impression on them. The
company made close relations with the Youtubers so as to immediately connect with the
prospective customers. The company takes survey from people on regular basis so as to
offer them products and compose the goods accordingly (Chow, Lai, and Loi 2015).
(Source: Marketing Interactive 2019)

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 Discount and Promotions: the organization also provides git cards and free samples to
the prospective people so as to large number of customers with them. This activity helps
the organization to let the customer try the products first and then purchase it for the
personal consumption. Along with the gift cards and samples, the company also provide
seasonal offers to the customers based on the events occurring in their area. The company
captures the culture and background of people and then conduct sales at that specific
period of time so as to attract more people and provide them good with reasonable
discount (Jussila, et. al., 2015).
 Public Relations: the core purpose of the public relations strategy of L’Oreal is to create
a stability between the offline as well as online marketing activities of the company.
Basically, the organization aims to use this strategy so as to create brand advocate for
them and raise brand awareness as well. The company aligned with several celebrities
and famous personalities with them so that people can purchase the L’Oreal skin care
products while considering their favourite celebs also use it. The company work with
different skin tones therefore, they work with celebs having all skin shades so that people
can purchase the products while looking at the famous celebs with similar skin tone (Xie,
Poon, and Zhang 2017).
Strategic Alignment of Organization’s Strategy
Analysing the strategic alignment of the skin care goods of L’Oreal with the communication mix
strategy of the business, it should be noted that although the company appropriately understands
the expectation of the customers but still there are few barriers in the expectation and product
delivery. This means that the organization has scope to improve the quality of the product and
the product and service delivery process as well. Alignment of both the aspects helps the
organization to analyse the consumer behaviour and satisfy them accordingly. Further, it should
be noted that the most important reason due to which L’Oreal skin care fails to successfully
achieve their sales target is that they give less importance to the consumer behaviour and
psychology (Kim, and Choi 2016).
The company focuses more on their products and services due to which they fail to analyse the
actual requirement of the customers. The previous assessments explained the importance of

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consumer behaviour in the environment how they react to skin care products decision making
process. It should be noted that majority of customer stated that they do not visit to the skin
doctors for treatment or suggestion. Therefore, the organization should provide products with the
detailed knowledge about its components that are necessary for their skin. As they do not visit
the dermatologist, therefore, this activity will create better impression on them (Wang,
Malthouse, and Krishnamurthi 2015). Further, customer behavioural analysis also stated that skin
care is important to them and more than 60 times on a scale; they make use of same products in
the marketplace that subsequently create them loyal towards the brand. Thus, through this
analysis, it can be seen that the organization should work harder on creating brand loyalty in the
market because of the nature of the customers present in this industry (Akhtar, et.al., 2016).
The customer behavioural analysis also stated that major reason for using skin care products is to
prevent their face from pimples and promote fairness as well. Therefore, the L’Oreal should
introduce such specifications in the products so as to increase the satisfaction and provide them
services accordingly. The quality of the products and its availability in the market are the two
most important factors that keep the customers loyal towards the products in the market.
Therefore, it should be noted that these are the customer’s behavioural factors that they want the
organization to introduce in the products. If L’Oreal would introduce all the customers,
behavioural factors in their communication mix strategy then they would be able to know that
what exactly the customers demand. Different customers based on their location and culture has
different skin tone and aspiration to attain different skin tone as well. Thus, the company need to
understand the interest of customers accordingly and then provide them products accordingly
(Šírová, 2015).
Like, the company need to supply fair pigmented products to American while dark pigmented
shade products to Asia based on the type of customers and their preferences for the makeup and
skin care products in the environment. If the organization successfully get to understand the
behaviour of the customers based on their differential factors, then the customers would become
brand advocate show loyalty towards the brand as well. Thus, it can be said that the company is
working effectively towards the communication mix strategy but still there is scope of the
business improve the marketing strategies to understand the customer behaviour and deliver
them products accordingly (Akhtar, et.al., 2015).

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Strategic Recommendation
Below mentioned are the strategic recommendation for the skin care category of L’Oreal in order
to increase the customer satisfaction and organizational productivity as well:
 Focus on Public Relations: the company should join hands with several influencers
present so as to capture the interest of the customers by depicting the impact of L’Oreal
skin care products on their favourite influencers. While looking at the advertisements,
every person attains the feel of using the product without actually using it. Thus, the
company should work with different skin tone influencers in the market so that the
customers could get an impression about the ways in which the product would affect
them also. The influencers would position the brand in right target and would help the
customers to have an impression about the brand in the target market. Further, it should
also be noted that the influencers would connect the customers with the brand officially
and would help the customers to directly get to know about the brand and initiate sales as
well. This is one of the most effective ways to attract the customers using their
behavioural psychology analysis (Yasmin, Tasneem, and Fatema 2015).
 Use of different marketing strategies for different target segment: as mentioned
above that the company has variety of brands in the skin care segment as some are
economic and affordable while other are premium brands. Therefore, the company should
differentiate the market strategies of both the product types so as to clear the mind-set of
the customers and make them choose the best product based on their interest. This type of
marketing strategy would offer an opportunity to both middle income level and high
income level to choose the product based on their interest and know that they can afford
the brand. Differential marketing campaign would also help the organization to position
the brand in both economic segment and high value segment as well (Garmatjuk, and
Parts 2015).
 Informative Marketing Strategy: the consumer behaviour analysis stated that the
customer want to take care of their skin but they do not have adequate information about
the ways to take care of their skin because they do not visit the dermatologist and they
only prefer the brands through group influences. Thus, the company should focus on
implementing informative advertising and promotional strategies in the market. This

Consumer Behaviour and Marketing Psychology 9
would help the organization reduce the importance of peer opinion for the customer and
take the decision on their own (Kimmel 2015). Further, informative marketing strategy
would also help the organization to attract the customers by providing them information
that they want to hear without paying extra to specialist. This would uplift brand image of
skin care segment of L’Oreal in the market.

Consumer Behaviour and Marketing Psychology 10
References
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Purchase Decision in L'Oreal Skincare Products. International Review of Management and
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Alvarez-Milán, A., Felix, R., Rauschnabel, P.A. and Hinsch, C., 2018. Strategic customer
engagement marketing: A decision making framework. Journal of Business Research, 92, pp.61-
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Ashraf, I., Ashraf, F., Azhar, N. and Anam, W., 2015. The Case Analysis of L’Oréal Corp. as
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Chow, C.W., Lai, J.Y. and Loi, R., 2015. Motivation of travel agents' customer service behavior
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Garmatjuk, K. and Parts, O., 2015. Consumer ethnocentrism in estonian skin care products
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Jussila, I., Tarkiainen, A., Sarstedt, M. and Hair, J.F., 2015. Individual psychological ownership:
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