Following L’Oréal’s announcement of their best quarter in 10 years mostly supported by Asian growth, where the Group achieved EUR 1,794.2 million of net sales in Q3 2018.

Digitalisation will play an important role in attracting Asian consumers. — Photo: courtesy of L’Oréal

Western Europe remains L’Oréal’s biggest market with EUR 1,855.9 million worth of revenue in Q3 2018, the return to growth in the region in therefore a key part of company’s strategy.

However, in Q3 the company registered a particularly strong growth in Asia, achieving EUR 1,794.2 million worth of sales, only EUR 61.7 million less than Western Europe. according to Aleksandrina Yotova, Consumer Analyst at GlobalData, “it is likely that while L’Oréal preserves its leadership in Western Europe and North America at current levels, its presence in Asia will keep growing.

Digitalisation will play an important role in attracting Asian consumers, and the company keeps on innovating in this field. With the acquisition of Canadian AR beauty company, ModiFace earlier in 2018, L’Oréal’s digital acceleration has stepped up, outrunning competitors Estée Lauder and Sephora, who have counted on ModiFace in the past for AR beauty apps development,” she adds.

Considering that e-commerce is up by an impressive 38.3% in the nine months to September 30, the alliance of e-commerce and new AR/AI technologies, could help L’Oréal to bring Paris to Asian consumers virtually, thus creating new growth opportunities.

As part of the strong overall Q3 results, came improvements in Western Europe. Performance of mass market cosmetics has been weak in the region, but brands like Garnier shampoo have delivered slightly better figures than the previous quarter. L’Oréal announced a sales decline of -0.7% in Western Europe in Q3 2018, better than the -2.0% registered in Q2. The company plans to keep investing in the region in order to achieve gains in market share. Due to consumers continued demand for premium beauty products, performance in the luxury division was particularly strong in Q3, registering a 15.6% growth. This was supported by luxury labels like Lancôme, which remained robust in Asia. The Active Cosmetics division was the other main contributor to growth, achieving 13.1% in Q3. It performed particularly well in North America and Asia, with the brand SkinCeuticals reported to have shown an outstanding growth,” concludes Aleksandrina Yotova.