L'Oreal challenges P&G in China

18 August 2009

BEIJING: L'Oreal Group, the world's largest health and beauty company, says it is going to challenge long-time market leader Procter & Gamble in the Y30bn ($4.39bn, €3.11bn, £2.68bn) mass market hair shampoo market.

So far L'Oreal has confined its hair care efforts in China to premium shampoos, although China is still the company's seventh-biggest market worldwide with sales growing 27.7% year on year.

Now it is to launch four new lines for damaged hair at a small premium to P&G prices but just a sixth of the price of its own high-end products.

L'Oreal China president Paolo Gasparrini says he is confident of the company's success even though it's late into the market.

“We are not worried about the price difference. We have our own ways to compete,” he says. “We are not worried about being late as we have the best formula and the passion for the beauty business.”

The company is hoping to replicate its late entrant success in the United States where it now claims to be the biggest hair care company.

P&G dominates the mass market shampoo sector in China with its Rejoice, Pantene, Sassoon and Head & Shoulders brands.

The company is promising a warm reception for L'Oreal's challenge.

“We welcome competition as it is good for us, the industry and consumers,” says P&G China corporate communications manager Charles Zang.

 “We are confident about defending our market share thanks to brand awareness, sales and research and development.”

Data sourced from China Daily; additional content by WARC staff