Opportunity meets preparation: How L’Oréal withstood the COVID-19 crisis in the SEA region

In SEA, the firm was well-prepared to take on the challenges brought about by the pandemic due to its strong digital business.

“We've been trucking along [since 2014] and it already contributes about double-digits of sales to the overall group which is quite massive already. Over the years we've invested heavily in digital. Our e-commerce teams are fairly large in all the markets,” ​said Karan Kansal, eCommerce director, APAC, for L’Oréal’s consumer products division.

Since the pandemic hit, the France-headquartered company has seen its e-commerce business grow by triple-digits.

However, Kansal recalled that the firm, like many other businesses, struggled during the early periods of COVID-19.

Fortunately, in SEA it was able to see how COVID-19 was playing out in other regions such as China.

“Overall, the business was extremely challenged in the initial few months. What was interesting was that we had advanced warning from China on how certain categories will play out. Make-up took a big hit and even skin care was initially a bit impacted,” ​said Kansal.

As such, prioritising certain product categories over others became the firm’s overarching strategy in SEA.

“We had to be extremely agile internally in our decision making. There were categories which weren't a big focus before like hair care and colour, but we had to quickly pivot to those categories because those were the only items that were selling,” ​said Kansal.

In terms of marketing, the firm had to be more sensitive about the messages it was pushing out to consumers.

“People were really focusing on essentials. They were not really interested in deals or things they really wouldn't be using. People had existential worries about jobs and salaries… It was about stripping down marketing to the very bare basics and talking about the essential products.”​

Additionally, the firm also pushed out educational content, such as hair-dye how-to videos featuring brand ambassador Eva Longoria.

“What worked in the end… was how close we were to what the consumers needed and just being on point with that by pushing the right products and the right messages,”​ Kansal told CosmeticsDesign-Asia.

Bringing beauty back​

A huge part of the L’Oréal’s e-commerce history in SEA involves the region’s leading e-commerce platform, Lazada.

The platform has allowed L’Oréal to engage directly with its consumer, an ability which is becoming increasingly important in today’s market.

“Lazada’s DNA, which I really quite admire, is that they don’t want to be the retailer in the middle. They simply want to be a platform for you to do your business. You can chat to your consumers directly, do livestreams… We like to be in control of the end to end consumer journey and we don’t want the retailers to do that job on our behalf at least in the e-commerce world,” ​Kansal said.

Most recently, the firm engaged its consumers in a very successful three-day campaign in partnership with Lazada to encourage consumers to get back to the swing of things in the new normal.

“We wanted to position this almost like a coming-out party. Across most markets we were coming out of lockdown and we felt it was the right moment to start talking about beauty again,”​ said Kansal.

He added that the teams hoped to move away from the “doom and gloom”​ associated with the pandemic and embracing the new normal.

“For us, it was not just a campaign. It was L’Oréal representing beauty and Lazada representing e-commerce, joining forces to bring beauty back.”  ​

He added: “It was truly an activation that went across all categories we have; across all the brands we carry. We made it a bit like a beauty marathon. It was very rich in content, with lots of livestreaming, a lot activation on Lazada and social media to create a buzz around the event.”​

New habits in the new normal​

As countries begin to open up and physical retail outlets open their doors, Kansal is confident the online beauty sector will continue to flourish.

“I don’t think e-commerce will slow down, in fact, COVID-19 would have given it a big boost and it will sustain. There's a saying in e-commerce, that once you've done it three times, it sticks, and it becomes a habit. For a lot of people, it was probably the first time they purchased beauty online. I would say that if 20 % to 30% of these people come back, it will be already a big boost for us.”​

Moving forward, the firm plans to explore the beauty tech arena to further enhance its digital offerings.

“We have a very good game plan on that. A lot is going to happen in that area. That for sure will be a big play for us. Particularly on personalised beauty, skin testing and AR. All these features will increasingly be a big part of our journey in e-commerce.”​