l'oréal

Fortune Staff

Aggregate sales hit $37.8 trillion last year—an increase of 19%, the highest annual growth rate in the list’s history.

Global 500

The 25th Fortune World’s Most Admired Companies list suggests that tech giants’ peers respect them as much as ever.

World's Most Admired Companies

Current All-Star Rank

Industry

L'Oréal | 2023 World's Most Admired Companies

legacy

L'Oréal

Sector

Previous All-Star Rank

Industry Rank

Previous Industry Rank

Overall Score

Innovation

People Management

Use of Corporate Assets

Social Responsibility

Quality of Management

Financial Soundness

Long-Term Investment Value

Quality of Products/Services

Global Competitiveness

L'Oréal | 2023 World's Most Admired Companies | Fortune

Chloe Taylor

Gen Z is more obsessed with smelling good than ever—and Burberry, Gucci, and Chloé bottles are raking in cash

/2023/05/30/gen-z-luxury-perfume-sue-nabi-coty-gucci-flora-burberry-hero-boss-bottled/

Amber Burton

Paolo Confino

L’Oréal’s CHRO interviewed 1,300 people about the working parent experience. Here’s what she learned

/2023/05/05/loreal-chro-caregiving-parents-benefits-pregnancy/

François Candelon

Nicolas Goeldel

Max Männig

Synthetic biology could disrupt some of the world’s biggest industries. Here are four steps to building a ‘syn-bio’ strategy

/2023/03/03/synthetic-biology-strategy-loreal-unilever-sanofi-basf/

Jane Thier

L’Oréal’s in-person workers get a $5 an hour concierge who will fill up their gas tanks and ferry their dogs to day care

/2022/11/10/loreal-eases-office-return-with-concierge/

As companies increasingly talk about their diversity, equity, and inclusion strategies, how can leadership and boards be persuaded to adopt role-based compensation structures and address areas of bias in the recruiting and promotions process? Our panelists will explore the pressing issues connected to pay equity, the rise of the flexible workplace, rising inflation and compensation, and how pay transparency helps or hurts the transition to equity. Join this timely discussion and explore how to bridge the opportunity gap to eliminate pay disparities and help employee retention. 

In partnership with Credit Karma 

Moderator: Maria Aspan, Senior Writer, FORTUNE  

 

Discussion Leaders: 

Marissa Andrada, Chief Diversity, Inclusion and People Officer, Chipotle  

Angela E. Guy, Chief Diversity and Inclusion Officer, L'Oréal North America 

Colleen McCreary, Chief People, Places and Publicity Officer, Credit Karma 

Bridging the pay equity gap

Leadership

Panelists explore the pressing issues connected to pay equity.

Panelists explore the pressing issues connected to pay equity, the rise of the flexible workplace, rising inflation and compensation, and how pay transparency helps or hurts the transition to equity.

 As the world's leading beauty company, L'Oréal is constantly reinventing itself. We're going to hear a lot about L'Oréal, actually, as a tech company and a company that's very focused on sustainability and leadership on the part of CEO and chairman Jean-Paul Agon. Jean-Paul, welcome. [MUSIC PLAYING] Good to see you. [INAUDIBLE] So this is a bit of a conflict of interest, Jean-Paul-- Why? --in that I'm a Lancome girl. Good. Good. And you suggested that I'm old because it used to be a-- [CHUCKLES] Never. --a label that us older women really love, and loved. But you have found, through digital technology, that young people are loving this product. No, I never said, of course, that Lancome was for old women. On the contrary. You know, I just told you in the discussion before that I remember when I was the chairman and CEO of L'Oréal in the USA in the 2000s, that the average age of the Lancome user was around 38, 40 years old in the US, and that thanks to the digital revolution, to the globalization, for example, to Asia alone, the average age of the local user, for example, in China now is more around 28, 29. Which is very interesting, because it shows that you can rejuvenate, and reinvent, and regenerate a brand thanks to this revolution. And Lancome also has become the number one undisputed global beauty brand in the world. And it's the number one beauty brand, for example, in luxury in China. Let's talk about that. That's fascinating. I want to get to China in a minute. But just technology-- talk about how you're using digital technology to keep this brand at the top, Lancome, and L'Oréal, and other brands. Yeah, I think it's a fascinating subject. I think that technology has changed everything in the past, I would say, five to seven years. In fact, there was a real complete change in a very short period of time. Of course, thanks to digital, thanks to the social media platform, thanks to Google search, thanks to ratings and reviews, thanks to e-commerce, this industry has changed completely. And the way we do business today, the way we interact with consumers is totally different from what it used to be even five years ago. You're personalizing. Yeah, absolutely. And you know, for me, it's fascinating, because I have been 40 years at L'Oréal. And I can really say that the last five years I've seen more change-- more dramatic change-- than the previous 15 years. It's amazing. And so we are really personalizing-- you're right-- personalizing for the relationship, which is very important. So we can really respond to individual needs, desires, dreams, et cetera. We can even now formulate almost for individual needs or also desires. And so this is the long-term, by-the-way, direction. The direction will be that the mission is beauty for all. But the next mission we will have will be beauty for each of all. Because we will be able, probably, in the long term to more or less personalize the beauty products we're going to do for billions of women around the world. And let's drill down a bit on that, on how you're doing that, using AI but augmented reality. Can you explain. Give us an example of that. Yeah. For the moment, it's mostly at the stage of choosing products and trying products. For example, we bought a company in Canada called ModiFace. And these guys are the champion of augmented reality, simulation reality. So what you can do with that is to, online, simulate the effect of a product on yourself. It's a technology that started a few years ago, but now that we have really mastered. And thanks to this product, you can do many things. You can simulate any type of makeup product on yourself, on your phone, for example. You can simulate new hair color, new haircut, new quality of skin. You can even do skin diagnosis, acne diagnosis. You can do all kinds of things. And this is a great help for consumers before they choose and before they buy the products. So it is a complete change in the way they can really buy products. And it's also fascinating-- we were just talking about this-- of course there's dozens of other cosmetic companies that have a smaller name but are super popular. And women are very loyal to a lot of these brands. And yet you've stayed on the top and you haven't been disrupted. How does that happen? It's interesting. It's true. Even more than that, in fact, we accelerated. And it's an interesting information-- a few years ago, people thought that the digital revolution would disrupt the beauty industry, and that big brands would lose their power, and that the smaller brands, there would be an inflation, mushrooming of small brands that would really take the market. In fact, what's happened is that, yes, there are more little brands, because now it's more easy than before to create your little brand. But it's still very difficult to go from a little brand to a bigger brand, because you stay small. But at the same time, the digital world, with the rating and reviews, the social media platforms, and the e-commerce, all this is working with algorithms. And in fact, the algorithms are favoring the top-of-mind brands and the top-of-mind products. So in fact the effect of that is that this is favoring the big brands. And the proof of that is that, in the past two years, we have seen our big brands growing like never before. We had, last year in the first nine months, our best year in 15 years. The market also, by the way. But our big brands have seen extraordinary growth, probably linked to this digital effect. Fascinating. And then we just had, as I was mentioning to you, a panel yesterday on China, and the Chinese economy, and e-commerce, where the growth in cosmetics is-- Huge. --dramatic. Huge. Because why? Because I think that China has been the country in the world that have really embraced e-commerce totally, globally, without any limits. It's fascinating to discuss with the young generation of Chinese. For example, Chinese woman, if you discuss with a young Chinese woman, 18 years, 19 years old, in a way, she doesn't even know that you can buy your product in a store. For her, the normal way to buy your product is to buy online. And maybe you can tell her, do you know you can find it also in the store? Ah, I didn't know. So for most of them now, this new generation is totally embracing e-commerce. And for us, we started very much at the beginning. We were the first partners of Alibaba seven years ago. And now e-commerce, for some of our makeup brands, for example Maybelline, number one makeup brand in the world, it's more than 50% of all sales. And it's also fascinating because it allows any consumer in China, any girl/lady in any city/region of China to order the product. So there is also no more limit to availability of the products in the country. And your size helps with that as well, I'm-- Absolutely. Questions-- go ahead and raise your hands for any questions. I wanted to ask you, while we're waiting for a question, agility-- you've got this massive workforce. How many people work for you? 100 and-- 86,000. 86,000. And yet you've trained your workforce to be agile and to spot trends. Yep. How do you do that? Oh, I think it has been always the culture of L'Oréal. You know, L'Oréal is a-- I would say it's a strange animal. It's not a company like others. It's a company with a very particular culture, always on the left, always curious, always ready to reinvent itself, to look for opportunities, to seize what's starting everywhere. It's also a company that covers all segments of beauty, everywhere in the world. So whatever happens anywhere in the world, we can see it, seize it, grab it, and maximize it. And it's also the organization that we have. Sometimes I call L'Oréal an organized chaos. And some competitors say, my God, what does it mean? But you know, in the world of today, where you have to be agile, and quick, and fast, and reactive, to be a kind of organized chaos is a very good thing. That's a good thing. Questions-- right here. Hi. Kevin Lobo from Stryker. I wondered about the sort of omnichannel approach. So do you have a proactive which has the subscription-based model for skin, for acne in the US? You also have the door-to-door of Amway and Avon. And then you have sort of retail. So how does that break down for you? Are you in all areas, or do you choose to isolate yourself? No, we are not. We are covering 90% of the segments and channels. But I'm sorry to say there are some parts of the business that we've never wanted to enter. And for example, direct sales has always been something that we never wanted to enter. And by the way, I think that we were right. Because as you can see, the evolution of some of these companies have been pretty difficult. So we are choosing pretty well where we want to go or not. But we are also testing and learning. Th subscription models are pretty new. We are doing some experiments. But I have, also, a great respect for my shareholders. So I don't want to go too much in models that have difficulties to become profitable. Questions-- right here. Not easy to get to the mic. It's coming. Yeah, sorry. [CHUCKLES] Thank you. Fields Wicker-Miurin, Board, BNP Paribas. Very nice to see you. Thank you. L'Oréal has a reputation for being very innovative, as we've just heard, especially on the digital side-- beauty for all, very close to customers, very good at listening to what customers are asking for. And I'm a big user of your products. Thank you. One of the things I do notice, however, is that to get to the beautiful pot of wonderful cream, I have to go through three different layers of packaging. Yeah. And obviously L'Oréal is not alone. It's just you're very big, you're very powerful, and you're a leader that people look to. I'm really interested to hear what are some of the innovations that are coming down the line that you're thinking about as you distribute your product to your consumer. That's an excellent question, packaging. I think all of us are feeling a bit of guilt when we-- You're right. --purchase these products. It's an excellent question, also, because for many, many years, packaging was part of the pleasure of a cosmetic product. And we have also to respect the pleasure of consumers. If they by your product, if they by your cream, for example, if you buy a Lancome cream, you would buy it in a beautiful jar, crystal or glass jar that is really a piece of art also. But we realize completely that we have to evolve. And so, for example, what we are doing in this-- some smart and simple moves, is that we are inventing, right now, refillable jars. So for example, you would buy your Absolue Lancome cream, which is a beautiful product. It cost a little bit of money. And it's a beautiful crystal jar. Inside, you have the product. But then, after that, you can keep the jar. And you will be able to just buy the content that you would put into the jar. So we think that there are many simple ideas that can really solve the question of keeping the pleasure for consumers, but at the same time being smart and sustainable for the long term. Recycling. Not only recycling-- because in this case, the good thing is that you don't even recycle. Because recycling is also pretty complicated sometimes. But recycling your own jar, yeah. Yeah, yeah. You keep the jar, but you just change the content with a kind of-- I don't know how to say it-- interchangeable part that you put inside, which is very easy to do. So anyway, we are working very much on that. It's clear that packaging is the number one priority for this industry for the next 20 years. Everyone is working on it. We have taken, already, commitments in terms of plastics. For example, we took the commitment that by 2025, all our plastics will be either refillable, reusable, recyclable, or compostable, that we will use 50% less plastics. So we are really determined to go fast, and to keep our leadership also in this field. Jean-Paul, thank you so much, both on a sustainability front, the technology front, the innovation front. Thank you. [MUSIC PLAYING] 

How L'Oréal Continues to Reinvent Itself

CEO Jean-Paul Agon joins Fortune’s Global Forum.

as the world's leading beauty company, Loreal is constantly reinventing itself. We're going to hear a lot about Loreal, actually, is a tech company and a company that's very focused on sustainability and and leadership on the part of CEO and Chairman John Paul McGann. John Paul. Welcome. So this is a bit of a conflict of interest. John Hall. I'm a link homegirl. Good, Good. And, um, you suggested that I'm old because, uh used to be a label that older women really love and loved. But you have found through digital technology that young people are loving this product. No, I never said, of course that Logan was for over in the country. You know, I just told you in the discussion before that. I remember when I was chairman and CEO of Laura in the USA in the 2000 the average age off the local user was around 38 40 years old in the U. S. On that thanks Thio, the digital revolution to the globalization to affordable to Asia along the average age of the local music, for example, in China now is Maur around 28 29. So which is very interesting because it showed that you can rejuvenate on dhe reinvent and we generate a brand thanks to the revolution on Drunk of also has become the number one on disputed global beauty brand in the world on day number one Beauty brand, for example, in In Luxury in China. And let's talk about that. That's fascinating when you get to China in a minute. But technology talk about how you're using digital technology to keep this brand at the top Blanco Memorial and other brands. Yeah, I think it's a fascinating subject. I think that technology has changed everything in the past. I would say 5 to 7 years. In fact, it was the rial a complete change in a very short period of time off course, thanks to digital, thanks to the social media platform, thanks to Google search thanks to our rating and reviews. Thanks, Thio Seeker murders. Uh, the This industry has changed completely on the way we do business today. The way we interact with consumers is totally different from what it used to be even five years ago. You're personalizing. Yeah, absolutely. You know, for me, it's fascinating because I have been 40 years that long So and I can I can really say that the last five years I've seen more change, more dramatic change than the previous 50 years. It's amazing. So we are really patronizing. You're right, definitely for the relationship, which is very important. We can really respond to individual needs, desires, dreams, it sit around. We can even now formulate uh, almost for individual needs or or so desires on. So this is the long term, by the way direction the direction will be that you know, that mission is beautiful role. But the next mission we will have will be beauty for each off all because we will be able probably in the long term, to more or less personalized beauty products we're gonna do for billions of women around the world. And let's drill down a bit on that on how you're doing that using a I but augmented reality. Can you explain? Give us an example of that's for the women. It's mostly at the stage off choosing products on trying products. For example, we bow to company in Canada called Bloody Face, and that these guys are the champion off augmented reality simulation reality. So what what you can do with that is to online to simulate the effect of a product on yourself. Uh, you know, it's a technology that started a few years ago, but now that we have really mastered, and thanks to this product, you can do many things you can simulate any type off, make a product on yourself on your phone, for example, you can create new heckle. Are you happy? Uh, new quality of skin. You can even do gnosis. You can even actually diagnosis. You can do all kind of things, and this is a great help for consumers before that shoes on before the buy the products. So it is a complete change in the way they can really byproducts, and it's also fascinating. Were just talking about this, of course, is dozens of other cosmetic companies that have a smaller name. It Arthur. Super popular, And women are very loyal to a lot of these brands, and yet you stayed on the top and you haven't been disrupted. You how that happened? It's interesting through even more than that. In fact, we accelerated, you know, and it's, uh, it's an interesting information, you know, a few years ago, people thought that the digital revolution would disrupt the beauty industry and that big brands would lose their power on that. The smaller brands that would be the inflation mushrooming of small brand that would really take the market. In fact, what happened is that, yes, they arm or little brands because now it's more easy than before to create your little brand. But it's still very difficult to go from a little brand to a bigger brand because if you stay, you stay small. But at the same time, the digital world with the rating and reviews the social media platforms and the e commerce know all this is working with algorithms. And in fact, the algorithms are favoring the top of mind brands on the top of my product. So, in fact, the and the the effect of that that this is favoring the big brands on the proof of that is that in the past two years, way have seen our big brands growing like never before. You know, we had the last year on the 1st 9 molder, our best year in 15 years, the market also, by the way, but our big brands have seen extraordinary growth, probably linked to the digital, is fascinating. And we just had a mentioning to you a panel yesterday on China, the Chinese economy and e commerce, where the growth on cosmetics is your dramatic huge. Because why? Because I think that China has been a country in the world that they're really embraced equal mass, totally globally, without any limits. It's fascinating, too, to discuss with the young generation of Chinese. For example, Chinese woman. If you discuss with the Chinese young Chinese woman you know, 18 years, 19 years old. In a way, she doesn't even know that you can buy your product in a store for her. The normal way to buy your product is to buy online on Dhe. Maybe you can tell her, Do you know you can find it all? So I didn't know. So because for most of them now, this new generation is totally embracing e commerce on for us. We started very much of the beginning. We were the first partners of Alibaba seven years ago on Dhe, now e commerce for some of our brands maker Brian's. Maybe Dean number one maker brand in the world. It's more than 50% of ourselves. And it's also fascinating because it allows any consumer in China any girl lady in any city region of China to order the product. So there is also no Maur limits to availability of the product in the country, and your size helps with that as well. Absolutely questions. Go ahead and raise your hands for any questions I wanted to ask you. While we're waiting for a question agility, you've got this massive workforce. How many people work for you? 180. 86. 80,000. And yet you trained your workforce to be agile, um, and to spot trends. How do you do that? I think it has been always in the culture of lawyer in the lorry. I would say it's a strange animal. It's not the company. Like others, it's a company with a very particular culture, always, you know, on a lad always curious, always reading to reinvent itself, to look for opportunities to see what's stopping everywhere. It's also a company that covers all segments of beauty everywhere in the world. So whatever happens anywhere in the world, we can C c z grab it on. Dhe maximize it on. It's also the organization that we have. You know, sometime I call loyal on organized cows on people's. Some competitors say, My God, what does it mean that you know, in the world of today, where you have to be a child on quick and fast and reactive, to be a kind of organized cows is a very good thing. That's a good thing. Questions right here, Kevin Level from Striker. I wondered about the sort of Omni Channel approach so they have, like a proactive, which has the subscription based model for skin for acne in the U. S. You also have the door to door of Amway and Avon, and then you have sort of retail. So how does that break down for you? Are you in all areas or do you choose toe? Isolate yourself. No, we are not. We are covering 19 percent off the segments and channels, but they are I'm sorry to say they are awesome. Some parts of the business that we never wanted to enter Andi, for example, direct sales has always been something that we never wanted to enter. And by the way I think that we were right, Because you could see the evolution of some of these companies have been pretty pretty difficult. So we are choosing pretty well where we want to go on up on. But we're also testing and learning. You know, the subscription models are pretty new. We are We are trying something. We're doing some experiments, but, you know, we are having a great respect for my share. Older. So I don't want to go too much in the models that have difficulties to become profitable questions right here. Not easy to get the mike. It's coming. Thank you. Field worker Muir ing Bored being be very, very nice. Very nice to see you loyal has a reputation for being very innovative, as we just heard on the digital side. Beautiful. All very close to customers. Very good at listening to what customers are asking for. I'm a big user of your products. Thank you. One of the things I do notice, however, is that to get to the beautiful pots of wonderful cream, I have to go through three different layers of packaging. Yeah, so might my and obviously nothing out there not alone. It's just you're very big. You're very powerful, and you're a leader that people look to. I'm really interested to hear. What what are some of the innovations that air coming down the line that you're thinking about as you distribute your product to your computer? That's an excellent question. Packaging. I think all of us were feeling at the guilty one week You're right. Tracks in question. Also, because for many many years, packaging was part of the pleasure of a cosmetic product on, We have to respect the pleasure of consumers the by product value cream. For example, if you buy a long cold cream, you would buy in a beautiful jar, crystal or glass jar, that really piece of art or on. But we realize we realized completely that we have to evolve on. So, for example, what we are doing in this smart and simple moves that we are way are inventing right now. Refillable job. So, for example, you would buy your absolute Lancome cream, which is a beautiful product, cost a little bit of money on. It's a beautiful crystal jar. Inside, you have the product, but then you could After that you can keep the jar and we will you will be able to just buy the content, you know that you would see it, they would put into the into the job. So we think that there are many simple ideas that can really sold the question of keeping the pleasure for consumers but at the same time being smart on sustainable for the long term recycling not only recycling because in this case, with the good things that you don't even recycle because, you know, recycling is also pretty complicated recycling your own jar. Yeah, Yeah, You keep the job, you just change the content with kind of I don't know what to say, You know, interchangeable parts that you put inside, which is very easy to do. So anyway, we're working very much on that. It's clear that packaging is number one, uh, priority for this industry for the next 20 years. Everyone is working on it. We have taken already commitment of plastics. For example. We took the commitment that by 2025 all are plastic would be either refillable, reusable, retractable or compostable that we will use Let's 50% more plastic. So we are really determined to go fast and to keep our leadership in this also in this field. John Paul, Thank you so much. Both on the run

[ MUSIC ] Jean Paul, in L'Oreal's 100 plus year history, there have been very few CEOs running the company. And you're the fifth one, and you've been at it for 12 years. So when it comes to leadership, what would you say has been the secret to your success? You know I think that honestly I know very well this company, and I love this company. It's the story of my 40 years, you know I started there when I was 21 years old. I think that I know instinctively what is good for What will make L'Oreal succeed and apparently it works. As you've said, you've been at the company for 40 years. And there have been a lot of changes over the last four decades, what change has surprised you the most? Mostly I think the digital revolution was a fantastic change. It has been a fantastic change because it has completely revolutionized the way we work but for the better. For the better because we interact much better now with consumers. The way we do marketing is much more interesting and richer than the way we used to do before So, in fact, it has really brought a lot of benefits. Well, I understand you were one of the early adopters of digital. You fell in love with it. But, many people were afraid of digital coming, they saw it as a competetive threat. You didn't see it that way, how do you feel? You know from the very beginning I saw a mutual opportunity. First again because I thought that it would transform for the better the relationship with consumers. It would put consumers at the heart with the conception of the product and development of the product and the relationship. And I thought of so it was a great opportunity to go faster than the competitors. And what happened? And Amazon is just a one example of taking advantage that hold digital or revolution. Many people were very worried and threatened by Amazon. And yet, L'Oreal has had a very nice partnership. Why you are feel so good about Amazon? No, I feel good with the everything new. Maybe my. My spirit. I'm always optimistic and positive. So I'm always trying to see where the opportunity, and it's clear that when you create a beauty product, when you want to serve hundreds of millions of consumers with your beauty products and as only offering a great new opportunity. It's true too for other players like Chinese players like Alibaba or others This e- commerce is a fantastic new channel to serve the best of duty to our billions of consumers. You have a very good relationship with Amazon's founder and CEO, Jeff Bezos. How has your relationship with him influenced the business decisions you're making For L'Or �� al. So I'm a great admirer, he's always future thinking, he's not in the present time, he doesn't really bother about what he's going to do or what the company will do in the next few weeks. He always try to think for the next two, three, four or five years and I think it's a It's a very good discipline. So it's not easy to run a century old company where there are so many entrepreneurs and startups that wanna disrupt your legendary business. What do you have to do to stay relevant? In fact, what we do is that we try exactly to behave like a startup. That was also my My vision is to make sure that L'Oreal is a leader but behave like a challenger, and L'Oreal is a big company and behaves like a startup. For example, we are very decentralized. We are strategically concentrated of course but very operationally decentralized. Which means many, many teams around the world are really behaving like entrepreneur in their markets. And I think that's one of the super successes for [ INAUDIBLE ] As you know part of being a great leader is also having a great Succession plan now. I see that you're still very young and energetic. [ LAUGH ] Thank you. But what is your timeline for naming the next CEO of L'Oreal? It's no secret no taboo, I've always said that I will pass the baton when I will be 65 which is in a few years. What are you looking foward for that next year? What do you think are the important leadership characteristics for the next person running the company? The most important thing is to have the right vision. So, I think that the next CEO will need to really understand the world around him and to adapt again and change again the company to be perfectly in tune with this new world. You've never had a woman running [ INAUDIBLE ] in its 110 year history? Now, we have a. More than 68 percent of the people that fly are women of course. And they are 50 percent of the ( inaudible ). One third of ( inaudible ) committee, 50 percent of all management positions. So, very Very soon a woman will be CEO of L'Or �� al. I don't know if it's going to be the next one or the following one. But very soon, obviously. What do you want people to say was your legacy to L'Or �� al? We'll see. I don't want, first, I'm not finished yet what I have to do. If they say that I [ UNKNOWN ] bold as I told you to adapt L'Oreal to this new world and strengthen the leadership of L'Oreal on all these aspects, financial, market share, but also in financial, I'd be proud.

How CEO Jean-Paul Agon Built L'Oréal into a Beauty Powerhouse

Revenues of $30 billion rank L'Oréal on the Fortune 500 list of the largest companies in the world.

[ MUSIC ] Jean Paul, when you announced 2018 financial results for L'Oreal, you said, it's been the best sales growth in the last 10 years. So, how does 2019 shaping up? Can you keep up this momentum? I think so. I'm pretty optimistic and confident because, in fact, the same reasons that existed one year ago for the very good growth we had are still there. Asia is still very dynamic. E- commerce is still very dynamic, travel retail is still very dynamic, the skin care market is still booming, so luxury is still booming, so probably it's gonna be a good year. But the one thing that is different is that The economies all around the world are slowing down. Some even say we could be in for a recession. What impact would that have on your growth plans? Not sure that all these people would say that the economies will go down are right, maybe not. And even if they are right, we have Been able to prove in the past, even in difficult economies, difficult times, the beauty business is still doing well. A big chunk of your growth came from China, and we know that that country's economy is slowing down. How can that impact your business going forward? To be honest, until now we haven't seen any slow down in China. We know that some parts of the economy are slowing down, but the consumption for beauty products is still very strong. Both in luxury and math. So we are until now, the dynamic is very good. We know that there are these trade tensions that are brewing between the United States and China. How might that impact your business? Probably not that much because first, we manufacture a lot of products in China. All the mass market products that we set in China are made in China. In fact they're also formulated in China, and often we have seen in other parts of the world. And when the The environment is a bit troubled. People are happy to buy beauty products, because it makes their life easier, more happy, more beautiful. So I'm not worried. You have said that the Asia Pacific region, which included China, is overtaking North America as L'Or �� al's number one market. Which really is incredible. When you think about the hundreds of millions of Chinese consumers who now. Have the available in come to to buy the products, I mean the reservoir of growth is immense. Do you think that the Chinese consumer cares whether their red lipstick is from Maybelline or does it have to be a luxury top. Brand like eSalon? No, because we are offering, and that's the specificity of L'Oreal is that we have such a category of brands at different level of price, different channels, different everything that we can really satisfy all needs. Let's talk about digital growth at L'Oreal because it was surprising to me to see that ecommerce sales, in 2018, grew by more than 40 %, which is huge. Yep, mm- hm. Now we think of digital in almost every single industry. But in beauty, how is digital changing the beauty business? Digital has changed everything in beauty. And it's It's pretty understandable, the digital and beauty are very visual things, and so the digitization as completely revolutionize the beauty industry, and we were the first at Loyale to embark in this adventure, so now we're ahead of the game, And it's true that for example in e- commerce now it's almost 3 billion euros, it's 11 % of our business, it's drawing 40 % so it's a major element of our growth. You have said that you went Loreal to be a pioneer and leader in the beauty tech world. Yeah. We don't think of beauty and tech. We don't use those two words usually in the beauty business. Tell us what you mean? I think that every industry or every type of business is transforming itself into a business tech. You have the Finance becoming fintech, biology, biotech. And I think it's the same for beauty. The future of beauty is tech, so it's the beauty- tech. And I think that I want L'Or �� al to be the pioneer first, the champion, and of course the leader of this new beauty- tech world. Can you see making tech acquisitions so that you can hit those goals. Yeah we just did it and we modified last year and we're gonna do others and anyway it's totally embedded in the way we work today. And then there's always a question about what Nestle about what it's going to do it it owns. 23 % stake in Loreal, how interested are you in getting that stake back? [ UNKNOWN ] has been a fantastic shareholder for 44 years, so we are really happy with the situation as it is. But as you know Nestle has an activist investor, Dan Lowe who would like to see Nestle unload a lot of its holdings What is Nestle decides to unload its shares in L'Oreal, what are you going to do? We'll see. I know that you have your annual meeting coming up in April. I'm sure this subject is going to come up. If your shareholders ask you about, what's gonna happen with Nestle and L'Oreal, what are you gonna tell them? I will tell them that. You know, I will tell them at first the decision is not on our side. The decision is on their side and And whatever they decide, we will adapt. [ BLANK_AUDIO ]

CEO Jean-Paul Agon Wants L'Oréal to Be a Leader in the New Beauty Tech World

Agon says that digital has transformed the beauty industry.

L'Oréal

Company Information

World's Most Admired Companies
As of 2/1/2023

L'Oréal

Company Information

World's Most Admired CompaniesAs of 2/1/2023

World's Most Admired Companies
As of 2/1/2023