L’Oréal declared most valuable cosmetics brand for third consecutive year

By

Barbara Santamaria

Published
May 5, 2016

L’Oréal Paris is the world’s most powerful cosmetics label, according to the latest Brand Strength Index by strategy consultancy Brand Finance.

The French company increased its brand value by 22% to US$13.7 billion in 2016, marking a record for the industry. The strong financial performance also bolstered the company’s strength in terms of familiarity, consideration, loyalty, investment, social responsibility and preference, delivering a total score of 91.5 out 100.

“L’Oréal Paris continues to impress: bettering itself and raising its game the whole time,” said Brand Finance’s Cosmetics Analyst Emilie Milton-Stevens. “It is performing well in three key respects: it is investing in trends and technology; it is innovating digitally; and it continues to inspire trust. Across the Brand Finance Cosmetics 50, brands based outside the US have been negatively impacted by foreign exchange rate changes, but L’Oréal revenue and brand performance was so strong that it not only counteracted that impact but actually grew 22%.”

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Gillete remained in the second position in the 2016 Brand Strength Index with a total value of US$7.1 billion, while Nivea came in third with US$6.1 billion in brand value.

The Index also shows that Brazilian brand Natura was badly hit by the combined effects of recession and inflation in the Brazilian market, where 81% of its revenue is generated. The depreciation of the Real against the dollar also contributed to the overall 67% decline in brand value.

Brazil is also the biggest marker for Avon, which declined 54% to US$1.8 billion in the period. Avon has admitted however that the US has also affected its performance due to a declining base of representatives and loss of profitability.

Meanwhile, one of the best performers of the years is Uniliver’s Axe (known as Lynx in the UK, Ireland and Australia). The deodorant label has pursued a strategy to realign its image with the launch of its “Find Your Magic” campaign, encouraging men to break free from assumptions and express themselves.