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Cultural dimensions in international business
Cultural dimensions in international business
The importance of managing diversity
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L’Oreal business got four important factors. The first one is universal; L’Oreal organization operating model and sales promotion are support universalization. While the organization not only keeping the global brand across the world but also L’Oreal are able to improve local economic and development. The second one is innovation, which is key development of organization, the organization itself to develop innovate. The third one is nimble; obviously, beauty is fast changed business in the industry. L’Oreal always find new chance in different field; such as markets and e-business. The last one is entrepreneurial; the unique aspect of L’Oreal is each business has independent sales distribution; business model and profitability logic. (Who we …show more content…
L’Oreal has been increasing and getting market share even though financial crisis happened in the Europe, L’Oreal competitors far away behind the L’Oreal. However, the great success in the world is by L’Oreal team strongly dedicated in home culture. (Hong and Doz, 2013) During the fierce competition, the most important of L’Oreal organization competitive advantage is support by professional with multicultural background in local country. L’Oreal business transformed from French beauty products to a global beauty products leader. Multicultural executives not only from French, but also from different countries, all other executives from home country as well as home executives deeply understand what exactly culture in home …show more content…
(l’oreal, 2014) All these factors are challenge for L’Oreal when L’Oreal entered a new market. It is important to know about people living in Asia, whitening beauty products is dominating in the market, on the contrary, Europe and North America is a very small market on the whitening products. L’Oreal have to take right acquisition decision in Asia market. In Asia, Shu Uemura is leading the make up industry. This brand is very famous for excellent design of beauty products. And then L’Oreal entered a new market it should be understand what the Asia people demands about beauty products. Acquiring Shu Uemura is a good opportunity to let the L’Oreal expand market share. And it is easily to know the home culture. In fact, Shu Uemura has a similar organizational culture with L’Oreal,both of them have talents and creativity employees to support them to create professional beauty
Marketing In this day and age is vital for a company to perform at its possible best. Marketing’s main focus is to give great satisfaction to a customer. There are many aspect of marketing, these aspects give marketer’s the tools to help strive for the best possible success they can achieve. They hope that they can create exposure for their brand, product or service.
Based on the information provided in the L’Oreal case, Yue Sai struggled to grow and capture additional sales in the high-end Chinese cosmetics sector. In the past, L’Oreal attempted to position Yue Sai in several different ways which can be viewed as detrimental to the company image, showing uncertainty as the company struggles to see which positioning strategy will stick. The most recent positioning presented in the case, which desires to “deliver Yue Sai’s longstanding brand promise that ‘Nobody knows Chinese skin better than Yue Sai’”, allows the highest probability of success for the company capitalizing on countless fresh trends in Chinese cosmetics (6). The positioning statement would reflect this new strategy: “For the modern Chinese woman Yue Sai offers a line of high-end cosmetics. Unlike other high-end cosmetics Yue Sai combines traditional Chinese medicine and sophisticated technology adapted to the unique skin type of Chinese women.” Yue Sai saw reasonable success and hope in the new Vital Essential line which utilized traditional Chinese medicine and, therefore, resulted in above average repeat purchases. Continuing to focus the strategy around traditional Chinese medicine should benefit Yue Sai considerably. Another suggested strategy would be to wholly reposition Yue Sai, however this is ill advised. As stated in the case, Yue Sai tried numerous different positioning strategies, which ultimately provided no clear path strategy. Repositioning would show uncertainty in the company, lowering brand value in the eyes of the consumer.
From the outset, Nestlé was an international company, assuming the multicultural traditions of its parent country. Almost its first ...
When L’Oreal planned to release Plenitude in the US market, it is assumed that what would be successful for the French market would translate to the same success in the US market if the same formula was applied.
The second direct competitor to Chanel is L'Oréal, the world's largest manufacturer of high-quality cosmetics, perfumes, and hair and skin care products. Although L'Oreal the company doesn't manufacture a perfume it owns the brand Lancôme that produces Tresor a perfume that rivals Chanel. In the chart below, it lists the US female fragrances brand share by value from the 2002 Tablebase data. The chart shows how the Lancôme perfume Tresor, Estee Lauder and Chanel are in relation to each other.
L’Oreal is the largest beauty company in the world and in the past 100 years that it has expanded, it has supplied to 130 countries with offices in 58 different countries. This global company is the number one premium cosmetic product in the world today and has taken the core and beauty of people’s everyday lives since 1907, the beginning of L’Oreal. The superior leadership of a guy named Eugene Schueller started this strategic company with basic products such as hair care and also the first man-made hair color product. Five years later you could find these products in Austria, Italy, and the Netherlands. In 1934 Eugene invented the first mass market of soap less shampoo and this led the success of L’Oreal in the country of Europe which soon recognized them as the leader in body care and hair coloring products. Finally soon after World War II L’Oreal moved into the United States and the company seemed to change. When L’Oreal expanded the competition was more involved and more growth was needed in order for the company to be more successful. With problems like this, the strategy and planning that has been applied in L’Oreal has been huge for the success of the company. L’Oreal realized they needed to expand in other fields of the beauty market and target markets in order to stay alive and successful. This would mean that L’Oreal would need to acquire other companies as part of their expansion and through this they have kept the constancy of the leading company with acquisitions of many small companies. Finally in the 1980s they started their globalization into new markets all around the globe by acquiring new companies that would form the cosmetics that we know today. Although the role of acquisitions has never been the main focus of the company, internal growth and strategy was the number one reason for L’Oreal becoming such a big name. The main strategy was to adopt new companies and expand it from within believing that the brand could be taken globally and benefit their overall brand portfolio. The main role of acquisitions was to increase and lengthen the internal growth rate. L’Oreal started acquiring companies from the beginning of their name. They started with the basics of their own brands such as L’Oreal Professional, L’Oreal Paris, Kerastase, and Club des Createurs de Beaute.
The transnational corporation Nestle Company founded in 1886 based in Vevey, Switzerland, sells its products in 189 countries and has manufacturing plants in 89 countries around the world, boasting an unmatched geographic presence. The company started off as an alternative to breastmilk and initially looked into other countries for an increase in global opportunities. It founded its first out of country offices in London in 1868, and due to the small size and inability of Switzerland to compensate growth manufacturing plants were built in both Britain and the United states in the late nineteenth century. A large portion of Nestlé’s globalization came in the 1900s which was when it first moved into the chocolate business after
For well established brands, a certain hubris can develop whereby the company believes their band and product will have universal appeal in all markets, and their product can obtain matched success across all markets, which typically leads to an overall lack of innovation and development. This was a crime that Oreo became guilty of when trying to move their brand into two new markets, and make their product international.
Andrea Jung is the CEO of Avon. She aims to breathe life into her giant cosmetics’ worsening sales. Indeed, after four cycles years of brawny vending intensification under her tactical supervision (Andrew Jung), the gigantic cosmetic’s corporation’s (Avon) take-home pay has gone unexciting and the go halves or share cost has defoliated further than thirty percent (Hill, 2014, p 405). Since, seventy percents of Jung’s company’s proceeds are in developing and underprivileged foreign countries markets, any lessening of growth emphasizes a huge lost for Avon in the beauty products competition. In so doing, the cosmetic company under Andrew Jung would, in due course, crumple if her management team cannot plan new strategy to enhance the sale. In
The purpose of this report is to evaluate Nestle Company industry based on the case study and comprehend how the company develops strategic intent for their business organizations following the strategic factors and approaches. I will analyze the strategic management process as firm used to achieve strategic competitiveness and earn above-average returns. I will critically examine the strategy formulation that includes business-level strategy and corporate-level strategy. It also aims to identify market place opportunities and threats in the external environment and to decide how to use their resources, capabilities and core competencies in the firm’s internal environment to pursue opportunities and overcome threats.
competitors include Mary Kay Inc., and Revlon, Inc. The company’s top foreign direct selling companies of beauty products are L’Oréal (France) and Infinitus (China). AVON sold their North American division, as 90% of sales come from non-U.S. markets. These companies are the top competitors for AVON, due to the similar product base within the cosmetic environment, price points, and target market audience (Wood, 2013). AVON has lost domestic market shares to Revlon, who has increased their marketing campaign against the company. AVON has a challenging foreign market to infiltrate between rivals in respected countries such as L’Oréal and Infinitus. The threat of substitutes is highly competitive within foreign markets in an already competitive industry to
The use of culturally diverse business teams is an increasingly common situation in today’s world; especially as the world continues to become a global village. Leveraging on the cultural diverse backgrounds and experiences of members of such teams can be a source of improved performance which can ultimately reflect a competitive advantage in the business market. As Symons and Stenzel (2007) aptly state, “culturally diverse teams are more likely to engage in innovative `out-of-the-box' thinking, given their different life experiences in diverse social environments.” Another pointer to suggest that multicultural teams tend to be a source of competitive advantage in business is found in the paper by Di Stefano and Maznevski (2000) where they state that “multicultural teams have an enormous wealth of material with which to create innovative approaches to complex organizational challenges.” They furthermore state that “today’s business cannot flourish without the creative value afforded by high performing global teams.”
“Research and innovation in the service of beauty “ has historically been identified as LOreal’s DNA because of its charismatic founder. His enterprise also continues in legacy at the Eugene Schueller center in Paris with the L’Oreal brand always growing into key markets with inorganic acquisitions.
This report analyzes the cosmetics retail industry in Hong Kong. There are many large-scale specialty cosmetics chains that are well developed in this market, such as Sasa, Bonjour, Colourmix, Aster and Angel, which are taking the lead. They mainly offer a wide range of international branded products and private label products to cater for customers’ special beauty needs, like make-up, fragrance, skincare items. With many dominant firms and a slowing growth in demand, the industry structure is being identified as mature.
Nowadays, the phenomenon of globalization has massively affected the social and cultural values and has made an assembled standard of uniqueness and obstacles. Moreover, international organizations such as multinational companies, corporate brandings, non-governmental organizations, and global media play a critical part by quickening communications among social societies worldwide (Ghodrati, Joorabchi & Muati, 2015). Especially for the effect of globalization, world has started become more culturally diverse and incorporated each and another. In today’s workplace, a constructive effect of cultural diversity in the work environment is that employees having a place