Specialist
Former Global VP at L’Oréal
Agenda
- Global mass market beauty trading dynamics and nuances across the US and Europe
- Cost and supply chain challenges and subsequent impact on pricing, margin and volumes – bottleneck implications, cost pass-through capabilities and magnitude of effect on large brands
- L'Oréal’s (PAR: OR) competitive positioning within the mass market beauty landscape – divisional breakdown, factors underpinning performance and potential market share pressures
- Longer-term outlook – make-up volume projections, key consumer trends and players’ resulting marketing spend decisions
Questions
1.
What 2-3 key trends do you believe will shape the mass-market beauty industry over the next 3-5 years?
2.
How will the global trends be nuanced across the US and Europe?
3.
How are players altering their route-to-market or marketing strategies in response to these nuanced trends? You referenced Europe’s ageing population creating premiumisation, for example.
4.
What is your performance outlook across key categories such as skincare, cosmetics, make-up, fragrances and haircare?
5.
How are supply chain issues and raw material cost price increases impacting sales for 2021, and how this might change going into 2022?
6.
How will the extremely high cost increases play out? To what extent are volumes in the mass market sensitive to price increases?
7.
Obviously, brands with more pricing power can pass on costs much more easily. Is there a distinction by category? Can costs can be passed on more easily in haircare, skincare, cosmetics, fragrances or elsewhere?
8.
You referenced a lot of product still being bottlenecked at the ports and on the ships. Will this have major consequences for the working capital of big players such as L’Oréal? How might inventories stack up?
9.
How would you characterise L’Oréal’s performance in the US since pre-coronavirus? I know it faced some challenges and volume declines prior to the pandemic.
10.
What is driving L’Oréal’s impressive performance in the US?
11.
All L’Oréal’s divisions seem to be outperforming in the US, from the mass market all the way to the premium divisions. Do you think this is due to any specific brands – whether L’Oréal Paris, Garnier or even some of the cosmetic make-up brands – or is it pure, broad-based growth?
12.
Are any brands in L’Oréal’s consumer products under-performing or potentially structured or positioned incorrectly, having discussed those that are outperforming?
13.
Are there market share pressures for L’Oréal in the US mass market that we should be cognisant of?
14.
When do you think the make-up category will return to pre-coronavirus levels in Europe?
15.
Might the rebound in make-up differ between eyes, lips and face? Is one of the categories outperforming?
16.
We noted clean, sustainable and natural-looking trends. Is there a longer-term risk of volume declines in make-up because women may want to pursue a more natural look? Was this a trend pre-pandemic?
17.
How will the trends we’ve noted impact marketing spend from players such as L’Oréal? Might marketing increase as a percentage of sales, given there are more channels to be targeted as part of route-to-market?
Gain access to Premium Content
Submit your details to access up to 5 Forum Transcripts or to request a complimentary one week trial.
The information, material and content contained in this transcript (“Content”) is for information purposes only and does not constitute advice of any type or a trade recommendation and should not form the basis of any investment decision.This transcript has been edited by Third Bridge for ease of reading. Third Bridge Group Limited and its affiliates (together “Third Bridge”) make no representation and accept no liability for the Contentor for any errors, omissions or inaccuracies in respect of it. The views of the specialist expressed in the Content are those of the specialist and they are not endorsed by, nor do they represent the opinion of, Third Bridge. Third Bridge reserves all copyright, intellectual and other property rights in the Content. Any modification, reformatting, copying, displaying, distributing, transmitting, publishing, licensing, creating derivative works from, transferring or selling any Content is strictly prohibited