The Moodie Report

Olivier Teboul previews L’Oréal travel retail strategy

Published: 22/12/09

Source: ©The Moodie Report

By Rebecca Mann, Associate Editor

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Olivier Teboul: "We are implementing a change of mind-set with our marketing"

FRANCE. Olivier Teboul was named head of L’Oréal travel retail's new Global Marketing operation in late 2008, a landmark year for the group for many reasons, not least the acquisition of YSL Beauté Holding from PPR. 2009, however, could not have been more different; equally memorable – but for all the wrong reasons, as the travel retail channel per se felt the full effects of the global economic crisis.

In short, Teboul landed a mighty big job within a pivotal division of L’Oréal just as the industry went into freefall. To what extent did that change his strategy and objectives as 2009 unfolded?

“The crisis obviously affected the turnover and the results of the division,” noted Teboul, “and of course there was a slowdown. That prompted us to change the way we operate, and especially our marketing.

“We devised activities that were more focused, and we concentrated our energies on the most important innovations, such as Lancôme’s Génifique and ‘power mascara’ Ôscillation, and on our key fragrance launches, namely Hypnôse Senses, Idole d’Armani and YSL Parisienne.”

But it wasn’t just a case of choosing which priority launches to support. “We also developed a way to showcase our products differently,” explained Teboul. “This year more travellers were looking for entry price products, because quite simply they had less to spend, so we regrouped some of our travel exclusives, for example. We created sets retailing at €15-€30 and merchandised them together in-store, on special gondolas.”

He added: “We also animated a bit differently. Above all, many actions were designed to help increase the penetration. Because clearly traffic was going down, and we wanted to help our retailers to bring as many of the travellers they did have into the shops.”

Various activities were devised, according to the location and the brand. “In Paris, for Lancôme, we distributed special vouchers at security with our retail partner,” Teboul related. “And we created what we term “Call to Action” media campaigns, inviting people to buy something specific from the shops.

Lancôme's latest anti-ageing flagship, Génifique

“With Biotherm, for example, we offered an Aquasource masque gwp with a certain level of spend, to drive up the ATV. In short, we increased the promotional part of the business and we focused on the main launches and innovations more than ever before.”

And the industry can expect more of the same next year. “Right now, my position is not so different from where I was last year,” Teboul underlined, “in that we have a lot of launches coming, which we will continue to support in 2010 and beyond.

“Likewise, we want to continue to support this year’s success stories. Both Idole and Parisienne will be boosted by edt versions next year."

Another big fragrance story next year will revolve around Trésor, which will celebrate its 20th anniversary – no mean feat given the industry’s increasingly short-lived fragrance life cycles.

“On a worldwide basis, Trésor is still a top five to ten fragrance,” noted Teboul. “We will introduce a new fragrance and story that is still obviously part of the Trésor family, but a bit fresher and younger. It will be called Trésor In Love.”

2010 will also be a significant year for YSL’s iconic scent Opium, which will be refreshed with new packaging, new advertising and a new project in the second half.

“In addition to the edt version of Idole d’Armani, we will further support the Armani Code franchise,” said Teboul. “We are also working on a project that will support Acqua di Giò, which remains a leader on the men’s market, integrating a brand new facet to this success story.”

BIGGER MEANS BETTER
But the reality is, however carefully it selects which products to support, given its sheer size L’Oréal still has a huge portfolio of brands to promote. Teboul agrees. “That’s the key issue: how do we animate so many brands and products? To address this, at Cannes this year we presented retailers with the concept of a global fragrance animation, which makes perfect sense.

“When you do a podium for a single fragrance launch, even a very strong one will probably represent a maximum 3% of a retailer’s business. But if we are able to do a global fragrance animation, then we can reach 20% of the market.”

The new signature feminine fragrance from Yves Saint Laurent, fronted by supermodel Kate Moss

He continued: “So we have designed a global fragrance animation, with major visibility for Lancôme, YSL and Armani. It can be adapted for big and small spaces. And it even includes a perfume coach, a tool that helps the BAs talk about fragrance. Because in some regions, that’s not easy to do, and of course often people do not know what they want to buy.

“The perfume coach is a way to engage conversation, and make product recommendations, which is especially helpful for gift purchases.”

On the product front, L’Oréal will turn its attention to YSL’s travel retail exclusive portfolio. “This needs work,” admitted Teboul. “The brand has a lot of value sets, but no palettes, for instance, which we will address.” On the masculine front, the group will continue to support L’Homme, in addition to the feminine pillars of Opium and YSL.

Lancôme will remain committed to Génifique, in addition to its other skincare franchises, such as Absolue, Rénergie and, in Asia, Blanc Expert. A new foundation line will be also be introduced in 2010.

"Everywhere in the world, we will promote our successful new launches, while also reinterpreting and supporting our classic, major pillars"

The L’Oréal group’s Olivier Teboul

And L’Oréal plans to capitalise on the strength of its Biotherm Homme portfolio in first-half 2010 with the debut of a Biotherm fragrance for men. “We know we reach a lot of men with Biotherm; the brand has around 45% market share in travel retail,” noted Teboul. “We are confident that our clientele is loyal, so launching a men’s fragrance will allow us to tap into a whole new market segment.”

And L’Oréal is likely to break new ground in another way when the first fragrance from the unconventional and innovative house of Martin Margiela is unveiled. The group signed a licensing agreement with the designer in 2007.

“This first Martin Margiela fragrance will be launched in local markets next year,” confirmed Teboul. “Regarding travel retail, we are trying to find locations where we will have the right space to express this brand. It’s very niche, very avant-garde and, just like Viktor & Rolf, it won’t be right for everywhere.”

Idole, Armani's fragrant new feminine pillar

Finding the perfect fit for brands and regions is, however, a L’Oréal strength. Take Kiehl’s for example, which has opened 18 flagship doors in travel retail in the past two years alone, with Asia proving to be a key zone.

“We have plans to maintain that pace,” stated Teboul. “And travel retail Asia in particular is one of the biggest markets for the brand. In August, for example, Kiehl’s downtown Hotel Lotte store in South Korea became the brand’s top door worldwide, generating over US$600,000 sell-out sales in one month – which was more even than the Kiehl’s flagship store in New York, for example.”

Going forward, Teboul is keen to recognise each brand’s geographical strengths, and market them accordingly. “We have to stay clear in our mind what we want to achieve with each and every brand, and of course this differs from one zone to another,” he remarked.

“Kiehl’s, and also Shu Uemura, are key brands for travel retail Asia, while Ralph Lauren is obviously more of a priority for the Americas. Biotherm is strong in Europe, while we consider Lancôme, YSL and Armani to be global priorities.

“To sum up, everywhere in the world, we will promote our successful new launches, while also reinterpreting and supporting our classic, major pillars.”

In other words, if Teboul’s strategy for 2009 was ‘fewer things, done bigger and better’, 2010 will largely be about revisiting the past to build for the future.

“Innovation is about much more than just new products,” Teboul agreed. “And marketing becomes even more important in difficult times. But you have to really target correctly, and decide what to support.

“Above all, you have to increase your penetration, and do this we want to evolve from animating just one launch in-store, to animating an entire brand – or even several brands. We are implementing a real change of mind-set with our marketing.”

MORE STORIES ON THE L’OREAL GROUP

L’Oréal Luxury Products and HMSHost open Kiehl’s and Beauty Lounge in Atlanta – 24/11/09

L’Oréal Paris presents Studio Secrets Professional collection and unveils new travel retail gondola for The Body Shop - 02/11/09

L’Oréal Megafies Viktor & Rolf fragrance portfolio - 02/09/09

L’Oreal and Armani worship new fragrant Idole – 27/07/09