Although it is now one of the parent group's biggest global businesses and the local leader in beauty, L'Oreal's US subsidiary has developed comparatively recently, the product of rapid and aggressive expansion during the 1980s and 1990s under former group CEO Lindsay Owen-Jones. Much of that growth was the result of steady organic expansion, and only partly and more recently through acquisition. Most purchases have been in the niche or professional sector, with the notable exception of Maybelline, the market-leading cosmetics business acquired in 1996. Other key local subsidiaries include ethnic specialist Soft Sheen-Carson and upscale skincare brand Kiehl's. More recently, the group has bolted on a collection of smaller homegrown high-end specialist brands, such as professional hair colour brand Pulp Riot, IT Cosmetics, NYX and Carol's Daughter. L'Oreal has also pieced together an extensive salon distribution network in the US, acquiring a collection of regional agents and merging them under the name SalonCentric. As elsewhere, the group operates across four core divisions of luxury, consumer products, professional products and active cosmetics. All the group's major international brands are represented here, including L'Oreal Paris, L'Oreal Professional, Lancome, YSL, Maybelline, Garnier and the Giorgio Armani fragrance license. Other key brands have a more US-centric position, such as Kiehl's, Ralph Lauren beauty and Essie, as well as a collection of specialist beauty brands like SkinCeuticals and CeraVé. Frédéric Rozé has been president & CEO of L'Oreal USA since 2009, and added responsibility for Latin America in 2013. L'Oreal's combined US revenues were $7.5bn in 2018, or a little over a quarter of total group sales. L'Oreal took its first direct steps into the US in 1953 with the establishment of local licensee Cosmair (or "Cosmetics For Hair") to market its safe hair colouring products to beauty salons. Until 1994, Cosmair remained separate from the main L'Oreal business, privately owned by the group's founding Schueller/Bettencourt family. That year L'Oreal bought control of the business, but didn't change its name to L'Oreal USA until 2000. See also:
Capsule checked 27th May 2019
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Adbrands Weekly Update 31st May 2018: L'Oreal signed off on two new deals this week. It acquired US professional hair colour brand Pulp Riot, best known for bright, bold hues - its top seller is purple - for an undisclosed sum. Sales are around $11m annually.
Adbrands Weekly Update 1st Mar 2018: Calvin Klein poached top L'Oreal USA marketer Marie Gulin-Merle to become its new chief marketing officer, filling a role that has been empty for almost two years, since Melisa Goldie departed the brand. Gulin-Merle, who has been CMO at L'Oreal USA since 2014, will report directly to Calvin Klein's new chief creative officer Raf Simons. Gretchen Saegh-Fleming, previously SVP, marketing at L'Oreal Luxe USA, moves up to replace Gulin-Merle at L'Oreal.
Adbrands Weekly Update 9th February 2017: L'Oreal announced a reshuffle of US marketers. Longtime Maybelline chief David Greenberg is moving across to lead professional products, following the retirement of Pat Parenty. He is replaced as president of Maybelline, Garnier and Essie by Ikdeep Singh, who has been standing in as brand president of L'Oreal Paris USA. Instead, that role goes to Tim Coolican.
Adbrands Weekly Update 28th Jul 2016: L'Oreal agreed to acquire fast-growing US beauty brand IT Cosmetics for $1.2bn, equivalent to around three times expected retail sales for 2016. Sales for 2015 were up by more than 50% on the year before. Founded in 2008 by former news anchor Jamie Kern Lima, and still led by her, products are sold mainly through home shopping channel QVC, although IT also sells through prestige chains such as Sephora and Ulte. It represents L'Oreal's first big move into direct-sold cosmetics.
Adbrands Weekly Update 17th Dec 2015: Another big "mediapalooza" review reached its conclusion with the decision by L'Oreal USA to consolidate all its US media planning and buying with GroupM's MEC. The WPP-owned shop had previously managed local planning for selected luxury brands, but now wins digital from Publicis network DigitasLBi and TV and print from Interpublic's UM. Billings are estimated at around $850m annually. It is MEC's biggest win by far this year. Publicis Groupe moved quickly to limit negative media coverage over another account loss so soon after the P&G decision last week, pointing out that the L'Oreal digital business represented only 0.1% of its annual revenues, or little more than $10m.
Adbrands Weekly Update 2nd April 2015: L'Oreal has launched a review of its substantial US media budget, according to AdAge this morning. Such a move was becoming increasingly inevitable, with duties currently split between a patchwork of different agencies and parent groups. Responsibility had traditionally been shared between Publicis Groupe's Zenith and Optimedia units, with Interpublic's UM handling some TV work. However, WPP's GroupM has made steady inroads into L'Oreal's media roster in other markets, including the UK and Canada, and picked off US planning for the Lancome brand and several designer fragrances in the US at the end of last year. This new contest looks like it could be a straight battle between WPP and Publicis, with Interpublic probably slipping through the cracks.
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