Comparison of Neutrogena and L’Oreal
Neutrogena Corporation is a public limited company that was established in 1930 within the consumer goods industry. The firm’s headquarters are located in the Greater Los Angeles Area in the US. In its operation, Neutrogena Corporation deals with the manufacture of various personal care products. The management of the firm has adopted a good marketing strategy. This has enabled the firm’s products to be distributed in 70 countries. Currently, the firm is ranked as one of the largest firms which deal with the production and marketing of a wide range of Johnson & Johnson products.
The firm has an extensive product line of personal care products related to hair and skincare. These include hair moisturizers and cleansers, anti-aging creams, and cosmetics. The firm also manufactures a variety of moisturizers and cleansers depending on the various skin types. For example, the firm manufactures cleaners that deal with sensitive skin. On the other hand, L’Oreal deals with a similar product line to those of Neutrogena. L’Oreal’s operation involves the production of a variety of cosmetics mainly perfumes and other beauty and hair products.
The management of Neutrogena has incorporated the use of agencies in advertising its hair and skincare products. For example, some of the agencies that have been incorporated in its advertising strategy include famous celebrities who endorse the firm’s products (Kenneth Para. 3). In addition, market awareness of Neutrogena skin and hair care products is also made through the use of dermatologists. Its advertising strategy also involves posting its products in various medical journals, direct marketing to the doctors, and participating in medical conferences. The firm also markets its products in various luxury hotels. Unlike L’Oreal, the management of Neutrogena has incorporated the concept of cost efficiency in creating market awareness through the incorporation of hotels and medical institutions in its marketing strategy (Porter Para. 12).
In creating market awareness, L’Oreal mainly relies on traditional methods of advertising. These include the use of print media, television, radio, and outdoor advertising through the use of billboards. Its advertising budget did not incorporate the use of the internet as a medium to create awareness. The company spends a significant amount of its financial capital on advertising. Approximately 75% of its advertising budget was allocated to television, 20% to print media, and 5% to billboards. However, the management of the firm is changing the way in which it conducts its advertising through the integration of online marketing through social networking tools such as the blog. The use of the internet has enabled the firm to launch new product lines such as men’s fragrances thus increasing the firm’s market size. In addition, the use of social networking tools in its advertising strategy has enabled the firm to save on the cost of advertising (L’Oreal experiments with new marketing mix’ Para. 3-7). To ensure effectiveness through the integration of online marketing, the management of the firm is incorporating the use of well-established agencies to aid it in various activities involved in online advertisement and website design.
Target market
The management of Neutrogena has incorporated the concept of niche marketing strategy. Niche marketing involves the production of specific products that meet the demand of a given market segment. Through niche marketing, Neutrogena has been able to reach a wide range of customers. These include women, teens, and adult males. This has enabled the firm to differentiate its products in relation to the demands of the customers. In producing its skincare products, the management of the firm considers the different skin requirements of the customers. For example, the introduction of the Neutrogena Camouflage stick was specifically targeted at male customers (Gabriela, Tory & Jessica p.1-3). The firm also introduced a skin product whose target customer is women. The product is produced to be consumed by women of all ages since they have common needs. The product mainly fights blemishes which is a common problem for women of different ages.
The management of the firm has also incorporated various market segmentation variables such as demographic and geographic variables (Kenneth Para. 3).
In addition, the firm’s product has been able to appeal to a wide range of customers due to their relatively low price. In developing its pricing strategy, the management of the firm considered the price-sensitive nature of the customers. Over the years, the firm has avoided price competition in marketing its products. The price is set to incorporate various customers according to their income level. A bundle pricing strategy is used in setting the price.
The firm has been effective at marketing to these categories of customers through the integration of effective product positioning. For example, the management of the firm has integrated an effective product positioning statement. The statement enables the creation of a positive image in relation to the firm’s beauty products. This is through the creation of an image in which all the users will be contented in using the firm’s products. The positioning statement also creates a feeling of higher self-esteem, encourages beauty, and builds on an individual’s character.
Works Cited
Solis, Gabriela, Khalil, Tory and Charron, Jessica. “ Neutrogena camouflage stick.” 2009. Web.
Hein, Kenneth. “ Neutrogena signs Emma Roberts.” 2009. Web.
Oracle. “ L’Oreal experiments with new marketing mix.” 2007. Web.
Porter, Michael. “Competitive strategy: what is strategy?”96(74): 1996. Web.