Innovation has been and remains the core of the L’Oréal model: the Group was born from a breakthrough innovation – safe hair dye invented by its founder Eugène Schueller. L’Oréal believes that beauty happens when science and creativity come together to meet the needs of consumers who expect new experiences over and above products and services. The discoveries of R&I, as well as the unique intuition and creativity of the marketing teams, mean that products are constantly evolving to meet consumers’needs. Because L’Oréal records a significant share of its sales with new products every year, the Group has a duty to be the champion of cosmetics innovation.
On the one hand, the beauty of the future is now focused on Green Sciences that reconcile efficiency, naturalness and sustainability to give the Group’s products, formulas or packaging a competitive advantage ; and, on the other hand, on Beauty Tech to enhance science via cutting-edge technologies on a large scale and to offer unparalleled beauty experiences. Innovation is at the heart of the model and, coupled with technology, is a driving force for growth and discovery of new areas of beauty. Data, artificial intelligence, robotics and nanotechnologies will strengthen and speed up the Group’s innovations to help make it a champion of the Beauty Tech. L’Oréal invents the beauty of the future while becoming the company of the future.
Over the next decade, the cosmetics market will become more digital and competitive, with the arrival of new players from new markets and other industries such as fashion, luxury and e-commerce. In this context, L’Oréal’s expertise and excellence in creating and developing major brands that a reprized by consumers all over the world will be essential assets. L’Oréal has always been able to create star products, from brand new franchise launches to innovations that evolve into “icons” over time. The skills of the marketing departments for our brands and laboratories are key assets in the collaborative, agile design of new products, services and customer experiences.
L’Oréal’s global footprint enables it to steer its growth by continuously adapting to the context it faces, seize opportunities as they arise and minimise exposure to are as where business is slower. In terms of regions, China is a major contributor for the Group and is set to become the leading beauty market; its consumers represent a significant source of growth, both in the local market and in Travel Retail.
Then, North America, currently the premier beauty market, is boosted by its demographics, the reinforcement of ethnic diversity, and the ongoing acceleration of e-commerce. The third growth accelerator for the Group is that of emerging markets, particularly South-East Asia, India and the Middle East, with a population of 3 billion; these markets are young, connected and hungry for beauty products. Although Europe remains the Group’s core region as well as its historic cradle, L’Oréal is also expected to accelerate its growth in Africa and continue its expansion in other regions of the world.
The Group’s four divisions enable it to meet all consumer expectations. The Luxe Division is now the Group’s primary division, responding to the desire for quality and experience in the upper-middle classes; the Consumer Products Division, the leading division in terms of units sold, is the main tool for conquering emerging markets; the Dermatological Beauty Division(1) responds to increasingly high expectations in terms of skincare and has more than doubled in size in five years;finally, the Professional Products Division enhances the sophistication of the market and the salon sector.
For L’Oréal, the economic and financial performance is not sufficient. Because there will be no economic growth without sustainability in the future, L’Oréal has set itself the dual goal of excellence, in both the economic and societal domains. It will be the condition for its success and its long-term existence. Because L’Oréal is the global leader in beauty, it has the duty to contribute to the beauty of the planet and be a champion of CSR. And it is because L’Oréal is a social, environmental, societal and ethical leader that it will achieve greater performance in the future. The two performances go hand in hand and mutually enhance each other, as L’Oréal has demonstrated to date.
In keeping with the legacy of our founder, Eugène Schueller, individuals and social harmony are at the heart of L’Oréal and must remain our priority in a climate where attracting talent is becoming increasingly complex. The Group’s values have always been humanist in nature. In entrepreneurial culture, passionate and committed teams are the strategic intangible assets that always have and always will make all the difference.
L’Oréal’s human and social project constitutes both the strength and the appeal of its model in an ever-changing world. It is based around two priorities: the attention paid to developing each employee through ongoing training, accelerated career paths or international careers; and a unique social model that combines competitive social performance and shared growth (profit-sharing, incentives, employee shareholding plan etc.).
For more than 15 years, L’Oréal has been committed to diversity, equity and inclusion and recognised for its actions worldwide. The Group’s policy in this area is further developed in section 4.3.2.6.
(1) “Dermatological Beauty” Division, as announced on February 10, 2023. Previously named “Active Cosmetics” Division.
