(News Bulletin 247) – The Stifel research office confirms its purchase opinion on the French cosmetics giant, considering it well positioned to exploit the potential of beauty technologies, with a view to better meeting the expectations of consumers. consumers.

Last week, L’Oréal met the market for a “capital market day”, that is to say an investors’ day. This presentation was an opportunity for the global cosmetics giant to review its roadmap. And becoming a major player in “the beauty of the future”, through technology and science, is part of the ambitions of the French cosmetics flagship.

Stifel analysts also came away from this presentation with “a better understanding of how L’Oréal exploits the potential of beauty technologies to better understand its consumers.” The design office points out that innovation will help L’Oréal in its marketing actions and improve “the consumer journey”.

Innovation is also the cornerstone of L’Oréal’s strategy to best meet the expectations of its consumers. “At L’Oréal, we are convinced that it can help us make beauty more inclusive and our products more efficient. This is why we are constantly innovating, day after day,” it is stated on the L’Oréal website. cosmetics giant.

Lancôme, one of its flagship brands, for example launched Hapta, the world’s first portable and computerized makeup applicator. This tool, equipped with a stabilizer, allows people with limited dexterity to apply makeup with precision.

Kerastase, a brand well known to hairdressing professionals, has developed K-Scan, a scalp and hair diagnostic camera powered by artificial intelligence. This tool has been launched as a pilot project in Spain and Australia since October, before a global deployment in 2024.

A more demanding population

“Being a beauty tech champion strengthens L’Oréal’s competitive advantage and should allow it to gain new market share in the years to come,” recalls Stifel. The French cosmetics and beauty flagship also said it was convinced that the exploitation of large-scale data “will make the group even stronger in a world disrupted by technology,” adds the design office.

L’Oréal has started to integrate technology into its activities since 2018, the aim being for the group “to anticipate and respond to the expectations and unmet needs of consumers before the competition”, he underlines.

“Being a champion of beauty technologies strengthens L’Oréal’s competitive advantage and should allow it to gain new market share in the years to come,” notes the financial intermediary who has renewed its recommendation for purchase, with an unchanged price target of 450 euros.

Last week, Morgan Stanley had already highlighted L’Oréal’s ability to stand out in a “very fragmented” beauty market. Only groups with strong backbones can easily invest in innovation and marketing, and thus accelerate their market share gains, explained the research office in its note cited by News Bulletin 247.

An expansion of the global consumer base

On the occasion of its investor day, L’Oréal also discussed the direction of the cosmetics market. It forecasts that its current potential market of 2.3 billion consumers – that is to say, Stifel points out, customers who meet the minimum income conditions to buy its products – will increase to 2.9 billion people from here 2030. These are therefore all potential consumers for L’Oréal which should, thanks to technology, adapt its offer according to the diversity of consumers.

But this population is increasingly demanding, notes Stifel. L’Oréal must therefore stand out and innovate so as not to be left behind by the competition. “Beauty consumers have become more sophisticated and more demanding of effectiveness with the democratization of online expertise (145 billion beauty product views on YouTube, 22 billion beauty product searches on Google , 600,000 beauty influencers, 7 million personal hairdressers and 13 million medical prescribers)”, underlines Stifel.

Last year, L’Oréal invested more than €1 billion in technology and employed 5,900 people in technology and data. Stifel recalls that the cosmetics giant has also filed 561 patents, while employing 4,000 researchers in 20 research and innovation centers.