L’Oreal Anticipates More Shares on the Chinese Market
L’Oreal SA, the largest cosmetics company by revenue in the world with strong make-up product sales, technology innovation and product value enhancement, aspires to become the leader on the Chinese market in cosmetics and beauty product sales.
L’Oreal entered the Chinese market 10 years ago and now ranks second in terms of market share and sales in the country. Besides its high-end cosmetic brands such as Lancome and Biotherm, it has been focusing on tapping the middle-and low-end mass products. The company purchased Mininurse and Yue-Sai in late 2003 and early 2004, expanding its presence in the hair-care and skin-care sectors. In addition, it has set up three plants in China, producing about 96% of all cosmetics products sold in the country.
In 2007, L’Oreal China saw a strong sales volume of 5.45 billion yuan, an increase of 30% compared with the previous year. Taking up 4% of the company’s global market sales volume, China became one of its 10 most important markets worldwide.
In 2006, L’Oreal accounted for 9.6% of the country’s cosmetics products market and the figure rose to 11.2% in 2007, narrowing the gap with market leader P&G.
Paolo Gasparrini, president of L’Oreal China, has much confidence in the cosmetics sector in China due to the fast increasing per capita income of the Chinese people. “We have a reasonable goal to become the No1 over the next three to five years, if we take our future business expansion plan into consideration,” said he.
Popularity: 7%
The Chinese people have increasingly strong purchasing power. In terms of the cosmetics industry, China is an important market to tap. The Chinese market can not be ignored.