Monday, September 14, 2009

Saturate Your Local Market? What Is Left For Growth?

L'Oreal, the giant luxury cosmetic company, is holding its own revenue-wise in comparison to its competitors such as Estee Lauder Cos. and Procter and Gamble.  In the first half, sales of L'Oreal's products, including Lancome and Kiehl's, plunged 13%. To me, that's not a big dive.

L'Oreal Chief Executive Jean-Paul Agon, with company headquarters based in the outskirts of Paris, shares his business vision for the future on L'Oreal with journalist Christina Passariello of the WSJ.

Biggest takeaway?
WSJ: L'Oréal already has a wide presence in emerging markets. What is left for growth?

Mr. Agon: We are really pushing our acceleration of business in new markets. Even this year, if Western Europe, North America or Japan are tough, the rest of the world is doing very well. China is growing, Brazil is growing, India is growing. And we are also opening up new markets where we were not before. Since the beginning of the year we have opened three new subsidiaries—in Egypt, Pakistan and Kazakhstan.

The internationalization is really doing well. For example, [first-half sales growth in] Brazil is 21%, India is 16%, South Africa is 19%, China is 14%. In a crisis year, when a big country like India or China or Brazil is growing double-digit like this, it's very encouraging.
Read the entire interview here and learn about L'Oreal's anti-crisis strategy.

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