L’Oreal navigates competitive EA cosmetics market

May 6, 2013
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, L'OREAL-PRODUCTSNAIROBI, Kenya, May 4 – “When I heard that this company wanted to venture into the East African market two and a half years ago and that they were looking for someone to be in charge I was really curious. This is because, just like many other locals, I thought they had only one or two products and hence very hard to sell,” says Patricia Ithau, the Managing Director for L’Oreal East Africa in an interview at her office in Nairobi.

Ithau says she is glad to head L’Oreal, the world’s largest cosmetic group which opened shop in Nairobi in late 2011 and has been feeding its Kenyan market through traders.

L’Oreal’s latest deal with Kenyan firm, Interconsumer Products Limited has stolen the limelight in the region in recent days after the international firm bought out the local firm that was producing Nice & Lovely, among other brands.

The cosmetics giant has now renamed the new business as Interbeauty Products.

However in the multi-billion deal, Interconsumer will continue to own the diapers and sanitary division that deals in All Time sanitary pads and Bouncy baby diapers.

The deal has signalled a huge message from L’Oreal whose Nairobi base will oversee operations for Uganda, Tanzania, Rwanda, Burundi and Ethiopia and push its Softsheen Carsons, L’Oreal Paris and Garnier brands among the 23 international brands in its portfolio.

“One thing I would say is that, the beauty industry is competitive and this is not going to change any time soon. This is because if there is something that consumers are ready to sacrifice on is beauty products. So you will see a crowded industry and I think it is healthy for the competition,” Ithau says adding that she is optimistic that the deal will grow the company’s market share despite the competition.

But why did L’Oreal insist on settling in the region and specifically Kenya?

“The Eastern Africa region has three ‘power houses’ one of them being Kenya as the centre and the hub of the region. Then you have Tanzania which is very fast growing economy, with GDPs (Gross Domestic Products), of six to seven percent, and Ethiopia. Again, consumers for cosmetics are many to attract any investor who is looking for growth,” she says.

The task ahead for L’Oreal is to now clarify and segment the various products for its target market as many perceive it to be a middle and high end brand, while Nice & Lovely was for the lower end of the market.

“I don’t know where the impression comes in that Nice & Lovely products are cheap, hence ‘cheap is expensive’. A company like L’Oreal which puts huge investments in science and technology could not have bought a product which is not up to international standards,” she emphasises.

She however says the biggest challenge ahead is dealing with the counterfeit issue which has become now a global illegal business and a menace especially to cosmetic companies.

“What we have found so far is that counterfeit in Interbeauty and L’Oreal is not yet large though it’s there. But we are going to be very vigilant.”

Ithau left East African Breweries Limited (EABL) as the Marketing Director after serving for a period of three years to join L’Oreal East Africa.

She began her professional career with household items and foods at multi-national firm Unilever which was previously known as East Africa Industries, after completion of her undergraduate degree.

A graduate of the University of Nairobi with a Bachelor of Commerce and a Master of Business Administration from United States International University, Ithau is also a graduate of the Strathmore/IESE Business Schools Advanced Management Program.

“My first four years at Unilever were spent in the consumer product segment and to be specific, the health and beauty business. If I look at my formative work life, it has always been in the health beauty segment. So, I have only done a whole round circle and come back,” she says smiling.

“I always tell people that I made a decision three years ago to only do things that I enjoy. For you to expect a good result is when you do what you love and what makes you happy. And if you don’t enjoy, it will show in your lifestyle.” Ithau advises.

Despite the huge task to grow and expand L’Oreal in the region, Ithau who is a mother of two says she has been able to balance her work life and family life by setting her priorities right.

“I have been married for the last 19 years and I have two daughters; one 17years and the other almost 15. The other day one of them asked me, ‘mum, why are you looking at me like you have never seen me?’ I smiled and explained to her how amazed I was that she had grown to be a big lady, yet she was a baby the other day,” we both laugh as I conclude the short interview.

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