Name: CEO Jean-Paul Agon Wants L'Oréal to Be a Leader in the New Beauty Tech World
Uploaded: 2019-03-01
Duration: 6 min
Description: Agon says that digital has transformed the beauty industry.

[ 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

Leadership

Agon says that digital has transformed the beauty industry.