L’Oréal Luxe: “Today e-commerce is our main growth driver”

By March 03, 2015
L'Oréal Luxe

The ‘L'Oréal Luxe’ division of French cosmetics and beauty company L’Oréal provided its sixteen brands with a basic digital strategy, and then left them time and space to roll it out, each in their own way. L’Atelier met up with the division’s Global Head of Digital.

Interview with Vincent Stuhlen, Global Head of Digital at L'Oréal Luxe, during a L’Atelier Numérique (L’Atelier Digital) broadcast on the BFM Business channel.

L’Atelier: In 2009, L’Oréal Chairman and CEO Jean-Paul Agon decreed that the L’Oréal Group should speed up its move to digital. Two years later, L’Oréal Luxe went through its own digital transformation process. What impact has your business unit’s digital transition had on the way the division works?

Vincent Stuhlen: Well we’ve seen completely new skillsets emerge, especially in the use of data. These jobs have been incorporated either at division level, or directly into some of the brand teams. Other more traditional marketing roles have changed somewhat, with the arrival of the process we call IMC, or Integrated Marketing Communication, which now requires marketing managers to take total charge of rolling out the setup, even on digital channels.

L’Oréal Luxe owns sixteen very distinct brands. Are you committed to having a uniform digital strategy for all of them?

We’ve developed a strategic framework which lays down exactly what the division’s goals and targets are as regards direct e-commerce, indirect e-commerce, profitability and customer data capture – for all the brands in the portfolio. However, once the basic framework is there each brand is allowed to adopt its own strategy and tailor its own objectives. We have a basic strategic framework in common. We supply the technology for establishing and measuring KPIs and drawing up reports, and then let the brands express themselves, according to each one’s very specific brand DNA.

Could you tell us more about the way you engage your customers in dialogue on the social networks?

At the present time, social media strategy is really what our brands are really focusing on at L’Oréal Luxe. We provide them with a set of tools and a way of working so they can communicate their own strategy. We have for example set up a ‘Content Factory’ at each of the brands, which enables us to put out two to three times the amount of content we used to put out in the past. This content is emotional as well as informative, and it’s also sales-oriented. It’s up to each brand to get the balance right between these three pillars of social dialogue.

So each individual brand develops its own social media strategy by building on the foundations laid by L'Oréal Luxe?

That’s right. Each brand decides how much it wants to dialogue. There are brands such as [Georgio] Armani Beauty, which are slightly more regimented, and others such as Kiehl’s which are much more interactive. But all of them work through social media. Just how much of a conversation they want to have, and how they want to do it…that’s their decision.

Another aspect, it seems to me, which is key to customer relations in the luxury sector, is service. How do you meet this requirement online?

Well, it can certainly be done. The technology enables you to personalise the whole setup. In all the surveys we’ve conducted, it emerges that this is the primary choice criterion for luxury sector customers. So content, offers and the customer experience are all personalised, tailored to each person’s needs.

Which makes your customer loyalty drive much easier…

Yes, it makes it easier for example to avoid the pitfall of trying to bribe the customer – where your CRM programme just boils down to glorified promotional offers. What we’re trying to do is shift towards creating a real relationship and real emotion, where the relationship stems from knowing your customer and sending the right message to the right person at the right time.

Is e-commerce up and running for your brands?

Yes it has been since 2001. It was then that we launched our first websites, the Lancôme site, for instance, in the United States. And since then e-commerce, both direct e-commerce through our own brands such as lancôme.com, and indirect e-commerce through our retail partners, has come to provide a substantial part of our revenue. Today it’s the main driver for growth at our division.

Got any figures?

Those figures are published at Group level, not at division level, so I can’t give you any. But I can tell you honestly that today e-commerce is our main growth driver.

Are you planning to extend e-commerce to all the brands in future?

Absolutely. Over two-thirds of our brands are today active in e-commerce in sixteen countries. We hope that all our brands will be successful overall in this approach, including on the international scene, using the system – the digital flagship – that we’ve implemented.

What will you be focusing on during the next few years?

We’ve spent three years building new overall platforms, for e-commerce, customer relations, data measurement. We’ll now be entering a new phase of our development which is, I would say, the business maturity phase. The second major area is innovation. Next year we’re going to launch a small internal investment fund to help innovation emerge, whether at international brand level, or country level, and also encourage innovation so that we can stay a step ahead in our field.

Legal mentions © L’Atelier BNP Paribas