L'Oréal’s Juan Ordoñez sees growth opportunities in the dermocosmetics market

CeraVe is going global. The American skincare brand created in 2005 was purchased by L'Oréal Group from Canadian pharma company Valeant in January 2017, along with the AcneFree and Ambi brands, for a total of $1.3 billion. For CeraVe, this meant joining L'Oréal’s active cosmetics division, which also includes La Roche-Posay, Vichy, Skinceuticals, Roger & Gallet and Sanoflore.


Juan Ordoñez, managing director of CeraVe in Spain - L'Oréal

With a presence in the US and Canada, the brand is preparing to launch internationally this year.

“We are working on launching in multiple countries in a progressive manner,” Juan Ordoñez, managing director for L'Oréal Group in Spain told FashionNetwork.com. “We have started to roll out in Europe in the second quarter, with the goal of completing the international launch within a year,” he added. Spain, France, Germany, Italy, United Kingdom, Portugal, Belgium, Greece, Austria, Russia, Poland and Bulgaria have already welcomed the brand. Mexico and Brazil followed, and there are further launches planned in Guatemala, Peru and Chile for the next months. Additionally, this June will see the brand enter Hong Kong, Taiwan and Thailand.

BUSINESS OPPORTUNITIES IN THE DERMOCOSMETICS MARKET

“The brand is tapping an important space in the dermocosmetics market, with affordable products that have medical and dermatological benefits,” said Juan Ordoñez about CeraVe’s integration into L’Oréal’s portfolio, where it is complementing the division’s varied offer. “We have a range of brands from beauty and organic labels like Roger & Gallet, Sanoflore and Vichy, to brands like SkinCeuticals and La Roche-Posay, which are much more professional and dermatological,” he continued.

“The dermocosmetics market is a great opportunity for us today, seeing the great dynamism it has shown in recent years. In Europe, it has grown 1.2 times faster than the total beauty market, driven by the growing consumer demand for skincare products, which at the same time implies a greater need for specialists,” Ordoñez said.
Worldwide, the division enjoyed the highest growth in 2017, up 11.9%, and surpassing by almost 8 points the group’s average growth of 4.4%. Last year, division sales hit the 2 billion euro mark in sales, and growth continued into the first quarter of the new financial year with revenues of 658.4 million euros (up 9.1%). The increase was attributed to the good performance of the group’s La Roche-Posay and SkinCeuticals brands, Vichy’s momentum and CeraVe’s dynamism.


CeraVe products - L'Oréal

With 10 million consumers in the US in 2017, CeraVe has doubled its growth in America in just two years, competing with powerful brands there such as Cetaphil. According to Juan Ordoñez, CeraVe has become the leading dermatologist-recommended brand in the US in the body moisturiser category.

With uncomplicated formulas and few ingredients, the brand wants to differentiate itself by offering products at an affordable price point (10 euros on average). It will be sold in pharmacies, compared to the multi-brand drugstore presence it has built in the North American market, where it has a wider offer. “Our goal as a brand and division is to support the development of the pharmacy, by launching the brand in bricks-and-mortar shops and endorsing their omnichannel strategies,” Ordoñez explained.

The L'Oréal Group ended last year with sales growth of 0.7%, reaching 26.02 billion in sales. Net profit edged up to 3.75 billion euros, up 2.8% compared with the previous year.

Translated by Barbara Santamaria

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