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Lancome

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by

Marie Louka

on 8 April 2014

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Transcript of Lancome

Brand
Financial Evaluation
Break Even Units = 2,586
Break Even C$ = 28,449.87
Break Even Market Share = 1.70%
Projected sales C$ = 60,137
Profits C$ =
31,687
Foreign Entry Potential
Implementation
Marketing Mix
Agenda
New Product Introduction
Consumer Profile
Market Profile
Marketing Mix
Financial Evaluation
Foreign Entry Potential
Implementation
Q & A
Consumer Profile
Market Profile
Product
Pricing
Distribution
Promotion
Consumer Segmentation
Consumer
Behavior
Lip product sales : 407.2 million

Forecasting: 426.2 millions in 2017 (6% growth)

Lancôme: 11.7% of market share
Lip-care Market in Canada
Barriers to Entry
Heavy competition
Limited stock and shelve space
Capital needed for investment
Canadian legislation
Low to moderate growing competition
Strong brand identities of existing players
Economies of scope & scale
Innovation is a necessity
Demographic Variables
Gender: Female
Age: Generation X & Baby Boomers
Income: High
Behavioristic Variables
Volume usage: Heavy users
Brand Loyalty: Lancôme users
Psychological factors -

redefined need, personalities, schedule/lifestyle,
learning curve, brand loyalty

Situational factors -

social & physical atmosphere

Sociocultural factors -

social class & culture, reference groups
L'Oreal's Net Sales Growth
at December 31st, 2013
New Markets
9.4 %
8, 475 million Euros

North America
3.8 %
5,356 million Euros
Western Europe
1.9 %
7,483 million Euros
Product
Founded in 1935
Owned by L'Oréal
#1 brand in women's selective cosmetics market
3 Pillars: grace, style, effortless poise
L'Oeuvre Rouge
Pigment-free corrector stick
Works with any brand of make-up, on any skin tone, with any shade of lip product
Mar.- Jun. 2015
Jun. 30, 2015
Dec. 31, 2015
Sept. 30, 2015

MARCH 20, 2015
Aug. 2014-Feb. 2015
Heavy Sales Promotion
Financial Analysis/
Evaluation of First Quarter
Financial Analysis/Evaluation of Second Quarter
Financial Analysis/
Evaluation of Third Quarter
Mass Production, Secure Suppliers, Preparation for Distribution, Finalizing Distribution Channel
Official Product Launch
Product Development
May - July 2014
Mar. 20, 2016
Full 1 Year Analysis &
Foreign Entry Decision
Pricing Strategy:
• Luxury brand
• Lancôme's makeup product line price range: $22 - $56
• Complimentary product
• Competitive oriented approach to pricing
• One price policy

Price Adjustments: Promotional Sales:
• No discounts
• Sample size promotion strategy
Factors Affecting Channel Choice
Environmental-
recovering economy
Consumer/Market-
lip product and make-up remover markets
demand for innovative products
Product-
luxury
Company-
familiarity with regulatory factors
growing sales
Marketing Channels
Direct Channel
Retailer Channel -> contractual VMS -> avoid channel conflicts
High-end pharmacies, boutiques, & department stores -> display stands
E-commerce
New Product Introduction

Differentiation
Goal:
Generate maximum consumer awareness
Emphasis on:
advertising
public relations
sales promotion
personal selling
Luxury brand
Unique function
Convenience
Ease of use
Time efficient
Branding

Pioneer Advertisements
Upscale fashion magazines
Vanity Fair
Vogue
Elle
Outdoor Marketing
Sponsorships of awards shows
Advertising & Public Relations
Sales Promotion
Minimal profits
Awareness-oriented promotional strategy
Expand customer base beyond early adopters
Avoid Price Penetration and Price Skimming -> offer at
full price
-> luxury branding
Prepare for increased competition and foreign entry
Urban population in the selected Asia Pacific Countries
L'Oreal's net sales growth
Free samples
Retail stores
E-commerce
Direct Marketing & Personal Selling
Lancôme VIP

email list
Target lipstick buyers

Face-to-Face contact
Targets specific consumer base
Push Strategy
Strong
existing ties
with retailers
Pull strategy not necessary
Provide retailers with tools to
push
to customers
QUESTIONS?
Competitor Analysis
Direct Competitors: Makeup Remover
Unilever (31.9%), Johnson & Johnson (14.5%), L'Oreal S.A. (9.8%), Beierdorf (8.3%) = 64.5% market share
Lancôme share: 4.9%

Indirect Competitors: Color Stay Lipliners, Non-smudge Lipstick

Proctor&Gamble (25.7%), Estee Lauder (17.4%), Revlon (16.5%), L'Oreal (14.2%) = 73.8% market share
Brand Mark: poise, elegance, & class
Multi-product branding strategy:
benefits from Lancôme's resources and brand equity
Extension of Lancôme's lip product lines
Product Life Cycle:
Introductory Phase
Positioning
Full transcript