Ambitious leaders driving the largest division

L’Oréal is the world’s biggest beauty business with €26 billion in annual sales.  L’Oréal USA accounts for nearly 30% of the company’s revenue and plays a key part in delivering its ‘Beauty for All’ ambition in a vibrant and increasingly disruptive market.

Sharing Beauty With All (SBWA), L’Oréal’s global sustainability strategy, was launched in 2013 with the aim of fully integrating sustainable development into the company’s long-term strategy. L'Oréal’s Chairman and CEO Jean-Paul Agon calls it a ‘paradigm shift’.

Progress has been reported across all SBWA commitments with 76% of new products launched in 2017 boasting an improved social or environmental profile. However, the L’Oréal USA leadership team felt that SBWA could be even more strongly integrated into colleagues’ thinking and business decision-making and so better support the organisation in achieving its ambitious business goals.

 

Sharing Beauty With All (SBWA) as a driver of growth

Fortitude, with our strategic partner BSR, was appointed in 2017 by the leadership team of L’Oréal USA. Our task was to identify how SBWA could create value in the US division. Specifically, we were looking for ways that SBWA could help brands connect with consumers, drive product innovation, spark consumer insights and reduce cost and risk.

 

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A tried and tested approach to connect SBWA to the business priorities

We started by creating a ‘snapshot’ of where SBWA (and ‘sustainability’ more generally) fits with L’Oréal USA’s strategic objectives. We reviewed extensive research into market dynamics and consumer trends, followed by interviews with every member of the executive team.

Based on these insights, we identified 3 focus areas – brands, innovation and employees. For each we articulated the challenge L’Oréal USA was trying to solve and a recommended route map of how to get there. We supported the rationale for each focus area with supporting evidence, supplemented by external out-of-sector best practice examples.

Starting with the simple premise that implementing SBWA in the US should be as robust as other programmes of strategic importance, we then devised a simple but robust governance structure to support a revamped programme that was critical to L’Oréal USA’s growth.

 

Outcome - clear direction and route map

L’Oréal USA’s leadership now has a clear focus on where and how to focus resources to leverage SBWA across the US business.

This starts with using SBWA principles to support its brands – for example by connecting more powerfully with the growing number of consumers who view trust, transparency and authenticity as being of primary importance in their purchasing decisions.

It provides insight and direction for product innovation – for example around the increasing trend towards natural products and personalised cosmetics.

Critically, SBWA can also be used to build a sense of meaning into the overall employee experience helping attract and retain the best talent – including from outside of the beauty sector.