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L'Oreal announce Body Shop expansion into international markets

By Louise Prance , 04-Oct-2006

French cosmetic giant L'Oreal has announced that it intends to extend the Body Shop brand into international markets. The move follows the £652m take-over of the UK based Body Shop by L'Oreal back in March 2006.

Talking to the Financial Times, Jean-Paul Agon, chief executive of L'Oreal, suggested plans to develop the Body Shop brand in countries such as Brazil, Argentina and China.

This would seem to be a lucrative business decision for L'Oreal as the three consumer markets are proving to be fast-growing environments of late.

 

The Chinese cosmetic and toiletry sectors has recorded sales growth into double figures - figures in line with GDP that continues to hover around 10 per cent. This gives China one of the largest industry growth rates in the world and has helped secure a position as a world-wide hub for the cosmetics industry.

 

Likewise the Brazilian beauty market looks set to become the world's third largest beauty market by 2007. This is due to strong industry sales growth, with the market growing at 34.2 per cent in 2005. And in Latin America as a whole, like-for-like sales growth came in at 16.2 per cent to reach €481m in the first 6 months of this year.

 

Having recently launched in India, L'Oreal is hoping that the Body Shop brand will more than double in size in the coming years, estimating that the number of stores will rise from 2,000 to 5,000 in over 100 countries.

 

L'Oreal is adamant that they are mirroring the flagship promotional message that Body Shop founder, Dame Anita Roddick, based the company on, which was the eradication of animal testing and the call for all businesses to be more 'ethical'.

 

However, at present L'Oreal is still conducting animal tests on certain ingredients, although it says it is committed to stopping the practise.

 

Jean-Paul Agon was quick to dismiss any idea of not being as dedicated to the cause as their new venture, Body Shop, stating: "The big ambition in terms of animal testing is to make animal testing disappear completely forever in the beauty industry" he said in the Financial Times interview.

 

Citing the way around animal testing as researching alternative ways of testing the chemical ingredients, L'Oreal are at present looking into a technique to use artificially produced human skin and have stated that they will continue to "invest like crazy on alternative methods in the future".

 

The extension into international markets comes at a time when Body Shop is launching new product aimed at a variety of categories.

 

The Business has recently launched a new colour cosmetics range 'Make Me Fabulous', which the company says is a result of feedback from customers.

 

The range focuses on delivering performance, premium packaging and new ideas based towards the need of their target audience.

 

Iftikhar Sidiqqi, product manager for the Body Shop UAE and Pakistan, stated 'The Make Me Fabulous collection's formulation, textures and colours are a result of feedback and comments from our customers all over the globe. In addition, the new packaging is 73 per cent recyclable and encompasses the latest trends in fashion.'

 

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