TBA Aarhus University

Our Team

Ioana Krisztina Ethenia

Romania Slovakia Indonesia

Agenda

Beauty market

Travel retail market Current experience

Consumer types

Future vision

Lancome Positioning

Digital strategy

Existing point of sales

Consumers

Competitors

SWOT

Beauty Market

Market size

In 2013, revenues amounted to $204.61 billion.¹

Market growth

Market Characteristics

Mature market

High market segmentation

High R&D2

Consumer urbanization

Increased spending propensity

Travel Retail Market

Market size In 2013, around $60 billion3

Market growth Estimated to double by 20254

Beauty sector 30% of the travel retail market5

L’Oreal

Market leader (21.3% market

share)6

Present Experience

Democratization of traveling

Luxury dominance

Sophisticated CRM

Customer is first and foremost a

traveler

Fast paced environment

Limited infrastructural capacity

Online shop and pick up option

Travelers: different needs than regular shoppers

Potential stress factor, time pressure

Different needs based on cultural background

Different needs based on traveling purpose

Traveling Impact

Customers at the airport

Gift Purchasers

mostly planned purchases

look for: discounts, sets and

special editions

attracted by beautiful packaging

and design

Layover shoppers

seek entertainment, more

time to spend shopping

impulsive shopper

leftover currency spending

Expert shoppers

smart, calculated decisions

limited budget

prefer products that are only

available abroad

price-conscious

Business Travelers

efficient shopper, stress averse

brand-loyal customer

also shopping upon request

limited time

Luxury Seekers

1) luxury as a norm

no budget limit

exclusive and rare products

2) breaking out of routine

indulging themselves

somewhat price conscious

The Future of Travel Retail

Opportunities Threats

Ads via augmented reality

Better utilization of

customers’ data

Near Field Communication

Travel review websites

Cluster – less ad space

Increased competition in

luxury segment

Positioning and Image

luxurious French-elegance

happiness

beauty

feminine

confident

accomplished

iconic

intelligent

Consumers

20+ Loyal customers

Attracted by fragrance

Adventurous

Undecided

25+ Classical

Elegant

Quality-seeker

30+ Loyal customers

Product-driven

Perfect fit

Digital Strategy

PUSH (promoting, informing & teaching)

PULL (feedback request & call to action)

Integrating social media platforms: Lancome Digital Chase

The Absolue world

Skincare analysis machine

Celebrating key cultural events

Existing Points of Sales

Merchandising

Travel friendly products and packaging

Merchandising POS elements, planograms, and staging

Gift sets, miniature coffrets, duos, trios, samples

Competitors

Target

30+

Career women,

Beauty-concerned

Preserving young look

All ages

Well aware of the

brand's spirit

25+ Puberty and up

Product

Skin care, make up,

fragrance

Good quality

Make-up, fragrance,

and skin care

Focus: vibrant skin

Skin care

Common natural

ingredient (Pitera)

Dermatologist

recommended skin

care and make-up

products

Image

Healthy skin and eternal

beauty

Elegance, romantic

Unique,

Both goal-conscious

and free-spirited

Luxurious beauty

Pure skin, young look

Eternal, natural

beauty

Quality above all for all

products

Price ++ +++ ++ +

Parent Co. Estee Lauder Bourjois P&G Estee Lauder

Competition for Fragrance

Luxury brands Personalities D&G Gucci Dior Calvin Klein Chanel

Competition for MakeUp

Dior MAC Chanel Estee Lauder Clinique Shiseido Guerlain

Competition for Skin Care

Estee Lauder Clinique

SK-ll Chanel

Shiseido L’Occitane

• French brand with tradition

• Reputation of high quality

• Make up and skincare teaching

sessions (Lisa Eldridge, blog)

• Products for all skin colours

• Considerable brand value7

• Strong market growth, especially in

Africa, Middle East, and Asia Pacific

• Unclear positioning (age group and

price range)

• Similar core message with other

French luxury beauty brands

• Less attractive for under 30 years

old

• Emerging middle class

• Cruise, in flight, hotels and

downtown shops yet unexplored

• Digital opportunities

• Technology for better in-store

experience

• Customers tend to look for

information in advance

• Competitors present and entering

the travel retail market

• Low switching costs

• Trend for natural product

preference8

• Consumers’ preference for local

beauty products

• Limited airport infrastructure

• Possibility of declining demand for

luxury in developed countries

Thank you.

References

1) http://www.wwd.com/beauty-industry-news/beauty-features/the-2013-beauty-inc-top-100-7824155

2) http://www.cosmeticsdesign-europe.com/Business-Financial/Euromonitor-P-G-no-match-for-L-Oreal-as-R-D-is-diluted

3) http://www.trefis.com/stock/lrlcy/articles/269024/travel-retail-the-future-of-luxury-cosmetics/2014-12-11

4) http://www.trefis.com/stock/lrlcy/articles/269024/travel-retail-the-future-of-luxury-cosmetics/2014-12-11

5) http://www.trefis.com/stock/lrlcy/articles/269024/travel-retail-the-future-of-luxury-cosmetics/2014-12-11

6)http://www.trefis.com/stock/lrlcy/articles/269024/travel-retail-the-future-of-luxury-cosmetics/2014-12-11

7)http://www.forbes.com/companies/lancome/

8)http://www.gcimagazine.com/marketstrends/segments/natural/Preferences-for-OrganicNatural-in-Beauty-and-Personal-Care-See-Growth-Space-261828421.html