L'Oréal is focusing on perfumes and hair products

"As expected, the growth of the global beauty market normalized over the year. In developed markets, this was driven by a gradual easing of prices after two years of high inflation; nevertheless, the underlying market trends remain solid in Europe and North America, as well as in emerging markets." These are the words that Nicolas Hieronimus, CEO of L'Oréal, used to comment on the third-quarter 2024 profits. The company, which owns the Maybelline and Lancôme brands, reported that sales for the three months ending in September amounted to €10.28 billion, with a 2.8% increase in revenue and a 3.4% growth on a comparable basis at constant exchange rates, but still below expectations.

North America improves

The Northern Asia region, dominated by China, accounts for a quarter of the group's sales, but the beauty market continues to deteriorate, due to various factors including economic slowdown and low consumer confidence. After the pandemic, consumers have started favoring local brands. North America showed better results, with a 5.2% increase in sales, accelerating from the previous quarter, thanks to the boom in demand for hair care products and perfumes.

The future of L'Oréal: innovation and haircare

Hieronimus emphasizes the importance of investing in innovation: "Our way to drive beauty is by offering innovations across all price ranges, ensuring that no consumer is left behind and can always find a L'Oréal product that meets or sparks their desire for beauty." The best examples are in haircare, such as Garnier’s Good, Natural Color, the launch of Kérastase’s Premiere and Elixir Ultime, and L'Oréal Professional's Absolute Repair Molecule. The choice to innovate has proven successful, thanks in part to the omnichannel strategy, which serves stylists while simultaneously offering high-quality professional products to consumers through selective distribution, as demonstrated by L'Oréal's Professional Products division, which saw organic sales growth of 6.1%.

The winning sector? Perfumes

L'Oréal Luxe, which includes the company's premium fragrance sector, remains the driving force, with sales up 8% in the quarter. Here are some figures: Valentino Roma, Prada Paradoxe, Yves Saint Laurent Libre, and premium collections like Maison Margiela Replica and Armani Privé performed well. These results are expected to improve further thanks to L'Oréal's investments in niche Chinese perfumes and, especially, with the launch of the Miu Miu fragrance in January.