L'Oréal: top five brands worth 60% of sales, luxury beauty labels strong in 2016
L’Oréal Paris, Garnier, Gemey Maybelline, L’Oréal Professionnel and Lancôme. In ranking order, they are the five heavyweights in cosmetics giant L’Oréal's brand portfolio. As reported by Challenges magazine, citing a survey by investment bank Morgan Stanley, the five brands together accounted for 60% of the €25.84 billion revenue generated by the L'Oréal group in 2016. Not surprisingly, L’Oréal Paris was top of the table, producing 23% of the group's revenue in the year. In second place was Garnier, specialised in the haircare sector and generating 11% of sales, followed by a closely packed trio consisting of Gemey-Maybelline-Jade, L'Oréal Professionnel and Lancôme, each producing 9% of the group's total revenue.
"L’Oréal Luxe posted a brilliant double-digit growth, significantly over-performing compared to the market," said on 27th July Jean-Paul Agon, CEO of l'Oréal, at the publication of the group's results for the first six months of the year. The group's luxury brands did in fact fare well in 2016, since the top five brands listed above were followed by Yves Saint Laurent Beauté and Giorgio Armani, each worth 4% of L'Oréal's sales. For example, in fifteen years, Giorgio Armani reportedly grew from a revenue of €480 million to €980 million.
Another jewel in the luxury division's crown is US brand Kiehl's. Acquired by L'Oréal in 2000, since then Kiehl's skyrocketed from a reported sales figure of €60 million to €960 million, boosted notably by the opening of monobrand stores. Again in the luxury division, sales for directional Japanese haircare brand Shu Uemura have reportedly grown from €170 million to €270 million. The group's active cosmetics brands, chiefly available in the highly dynamic toiletries channel, also posted very strong performances.
Challenges magazine noted how, between 2001 and 2016, the combined revenue share of the top five brands has decreased from 75% to 60%. Lancôme is emblematic in this respect, slipping from second to fifth place among L'Oréal's brands. This trend highlights the need for L'Oréal to diversify its range, and in 2016 the cosmetics giant bought French niche fragrance brand Atelier Cologne and US make-up and skincare brand IT Cosmetics.
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