L’OREAL
INTRODUCTION
Strategy analysis focuses on the long-term objective generating alternative strategies, and selecting strategies to pursue. The firm’s present strategies, objectives and mission, couple with the external and internal audit information, provide a basis for generating and evaluating feasible alternative strategies (David 200).
L’Oreal has numerous competitors. To have an advantage on competition, L’Oreal has to apply some strategies that include internal audit information and external opportunities that will make the company stronger. They will also prevent competitors to have an advantage over L’Oreal.
This report will be based upon the effectiveness of current strategies of L’Oreal, a real global leader in every segment of the industry.
CURRENT STRATEGIES
L’Oreal encounters threats and opportunities and they have weaknesses and strengths. It is known as the TOWS matrix. It is an important matching tool that helps managers develop four types of strategies: SO Strategies, WO Strategies, ST Strategies and WT Strategies. The external opportunities and threats were identified earlier (see part 1) by developing the “External Factor Evaluation Matrix” and “Competitive Profile Matrix” is important for the current strategies development. L’Oreal internal strengths and weaknesses will be discussed further in this report.
SO Strategies
SO Strategies uses the internal strengths to take advantage of external opportunities of a firm. L’Oreal has always taken these advantages with their new innovations and global expansion. The company is reaching out to more people across a bigger range of income and cultures than just about any other beauty-products company in the world. L’Oreal strategy positions it beautifully to profit even further when the middle class begins to grow stronger in emerging markets. That makes L’Oreal competitors more hustling to catch up.
WO Strategies
WO strategies aim at improving internal weaknesses by taking advantage of external opportunities. Laws and governmental regulations require companies such as L’Oreal to maintain certain standard in quality and responsibility for their product. Rules may vary depending on the country. L’Oreal also have it own set of regulations that are very strict on quality. Whatever product is put on the market, one can be sure that it has gone through a very thorough and scienti...
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...bsp; + 14.9%
(1) L'OREAL Group share: 50%.
(Www.loreal-finance.com)
CONCLUSION
L’Oreal is a company that has seen various external opportunities and threats. They know how to handle their strengths and weaknesses to their advantage. Developing analytical strategies will improve and increase L’Oreal competitive advantage over Revlon, Clairol and others. With the global expansion, new innovations and the Internet strategy, it will definitely increase the sales and automatically more profits.
If they follow their strategies and mission, L’Oreal will be in business for a long time and will find new ways to surprise us.
References
David, Fred R. Strategic Management: Concept & Cases. New Jersey: Prentice hall, 1999.
“L’Oreal: The Beauty of Global Branding” Business Week. 11 April 2002
<http://www.businessweek.com>.
“Strategy Tip Of The Week.” 23 April 2002.
<http://www.strtegy4u.com/tip/tip39.html>.
“Annual Report 2002.” L’Oreal. 26 Mars 2002 <http://www.loreal-finance.com/>.
There are many issues involving L’Oréal Canada and its involvement in animal testing. Many consumers feel strongly about animal testing because it is inhumane, therefore they do not wish to purchase products tha...
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Pricing. Our product is priced lower than our competitors in our industry. Even though our competitors have a different kind of product compared to us.
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