Loreal and the Globalization of American Beauty

Overview of the Situation and Problems

Kiehl's started as a small American beauty company established in 1851 in New York City. It was purchased in 2000 by L'Oreal, the world's largest beauty firm. The acquisition of Kiehl's was a part of L'Oreal's long term globalization strategy, which also included the addition of popular American brands like Maybelline, Redken, Matrix, SoftSheen-Carson, and Ralph Lauren to its international brand portfolio. L'Oreal's approach to acquisitions has historically been to choose brands with long, deep rooted history that would introduce them to a new segment of market share and with strong growth potential. Kiehl's did not deviate from this pattern; it was a small family luxury brand with a grass-roots culture and deeply rooted in New York City and would strengthen L'Oreal's positioning in the specialty store high-end segment. Kiehl's identity was well defined and as a result, the main question to be addressed was: How far to take Kiehl's in the global marketplace while maintaining its integrity as an alternative brand with a cult following? The decision to go global was already made, the next steps will be to assess Kiehl's organization and to decide to what extent it is globalized, as well as how to do so without losing sight of the company's core identity.