L’Oreal has been a long-time leader in the beauty industry that’s ripe with all kinds of competition—whether that’s with the rise of K-beauty, in which beauty products are inspired by Korean influences, or thanks to brands popularized by social media.
But competition need not be a thing to push back against. L’Oreal’s Nicolas Hieronimus, who took over as the French cosmetics behemoth’s CEO in May 2021, thinks testing out competitors’ products can inspire his company's own offerings.
“I try my products, I try the competition just to make sure we have the best and sometimes we see an interesting competitive product that we have to step up to,” Hieronimus said in an interview with Bloomberg TV.
Hieronimus is a self-proclaimed “beauty junkie”—he’s spent nearly four decades with L’Oreal, which counts labels like Maybelline and Yves Saint Laurent under its belt. He has witnessed the beauty market ebb and flow through periods of volatility before, while also seeing it crack it open for new players.
“There’s more competition, there’s lots of brands. One of the things that has changed over the years is that some of the barriers to entry—like the rise of e-commerce and social networks—has allowed many brands to appear,” the L’Oréal chief said.
Despite the heated competition, Hieronimus says he’s aware that it’s challenging to be among the top brands in a consumer goods industry where preferences and trends are always changing.
“I'm a competitor. I love sports and I try to be demanding for myself and demanding for everybody because we have big goals to achieve,” Hieronimus said. “Being number one and increasing our gap with the competition is not that easy.”
A market as big as beauty could often become about beating other players and staying at the helm—but that’s not how L’Oreal’s top boss thinks of it. In fact, he thinks synergies could help the industry deliver real good to the world.
“A couple of years ago, being a CEO was about beating the others, winning the game against the others. We still have to gain and to win and to win share, but more and more we have to work together,” Hieronimus said. “And I like the idea that sometimes I take my phone and I will call the CEO of one or two of our competitors to work together at creating solutions for the world.”
A booming market in the works
As competition has increased, the beauty market has also expanded from a consumer point of view. For instance, the relatively new crop of brands has paved the way for a transformation in the beauty tech space through tools that offer personalized solutions to customers, Hieronimus said.
He expects the beauty market to be worth around €400 billion ($424 billion) by 2030 from €270 billion ($286 billion) now, driven by the swelling number of middle class buyers as well as shoppers looking for premium products. L’Oreal has also been considering its impact on the environment and how it can strengthen its sustainability efforts—a key part of its identity that the younger generation values. For instance, the company has a goal to use 100% recycled plastic by 2030.
There are still hurdles to navigate including China’s cooling growth, which has dented consumer spending. But L'Oreal remains robust, thanks to strong overall demand for beauty products globally. In the first six months of the year, the company saw sales worth $21.82 billion, up roughly 13% for the same period a year ago, as well as growth in all its regions, especially Europe. L’Oreal also completed a major acquisition in August with luxury brand Aesop, which was announced earlier this year.
Representatives at L’Oreal didn’t immediately return Fortune’s request for comment.
