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CHAPTER 1 INTRODUCTION 1.1 Overview of Research Objects 1.1.1 CHAPTER 1 INTRODUCTION 1.1 Overview of Research Objects 1.1.1 General History of L’Oreal L’oreal Group is the largest cosmetics and beauty company in the world founded by a French chemist, Eugene Schueller. He was one of the young graduates of the Institut de Chimie Appliquee de Paris (now changed his name to Chimie ParisTech) in 1904. The company was headquartered in Clichy, France and was founded in 1909. The company produces various kinds of cosmetic products and employs 68,900 workers. The L’oreal Group first arrived in Indonesia in 1979 by distributing Lancome, one of the luxury brands. Several other L’oreal brands in the luxury category in the following years also enlivened the Indonesian market such as Guy Laroche, Cacharel, and Ralph Lauren perfumes. In 1985, the Loreal Group collaborated with local companies and established manufacturing companies, PT. Yasulor Indonesia. In 1993, the L’oreal Group took over all of its operations in Indonesia and starting in 2000 formed the entity PT. L’oreal Indonesia. Until now, the Loreal Group's business activities in Indonesia have focused on both of these entities, namely PT. L’oreal Indonesia handles the marketing and distribution of Loreal brands and PT. Yasulor Indonesia produces skin and hair care products in the mass market segment to meet the needs of the domestic and Southeast Asian markets. The L’oreal Group is currently present in Indonesia with 15 brands divided into 3 categories, namely: luxury, consumer, and professional (salon). Through various distribution channels. These brands are L'oreal Paris, Maybelline New York, Garnier, L'oreal Professional, Kerastase Paris, Matrix, Lancome, Biotherm, Shu Uemura, Yves Saint Laurent, Kiehl's, Ralph Laurent perfumes, Giorgio Armani, Diesel, and The Body Shop. PT. L’oreal Indonesia is very concerned about quality standards and Good Manufacturing Products (GMP) for cosmetic products. PT L’oreal Indonesia has also implemented a government program in developing environmentally sound industries or green industries that realize sustainable development On July 18, 2014, PT. L’oreal Indonesia was announced as the first company in Indonesia to win the "Greenship Interior Space" certification from the Green Building Council Indonesia after successfully fulfilling the requirements in an environmentally friendly rating system that proved the company's commitment in applying the greening concept. 1.1.2 Vision & Mission Vision and Mission is something that must be achieved and implemented by the following companies: Vision & Mission of PT L’Oreal Paris: a. Vision The vision of the L’oreal company is to get one billion consumers worldwide and create beauty products that meet the unlimited diversity of beauty needs desired by consumers. b. Mission L’oreal has made a beauty product project for years to come. Beauty is universal, meaning that L’oreal offers the best beauty products, both in terms of quality, efficacy, and safety for women and men throughout the world. Beauty is nature, in this case, L’oreal explores and creates new products in the future. Beauty is a commitment, meaning L’oreal creates an innovative power to preserve the beauty that supports society 1.1.3 Company Logo The logo is the identity of a company and the following is the logo of PT. L’Oreal Paris: Figure 1.1 Company logo PT. L’Oreal Source: www.Loreal.com 1.1.4 Organizational Structure The organizational structure is a framework that describes the authority and responsibility in each part. Therefore the organizational structure is one of the factors that support the success of a company. Following is figure 1.2 regarding the organizational structure of PT. L’Oreal Paris: Figure 1.2 Organizational structure Source: www.lorealparis.com 1.2 Background of Research Nowadays, face and body care are not a strange thing to the man anymore, appearance is one of the important things for men, not only because of their desire to appear charming and confident in front of women but also the demands of the work they do. Many men try look balanced with the appearance of women who naturally look neat and well-groomed (Trisdiwiastuty, 2015). Now face care is not only related to the women, but now men are beginning to realize the importance of maintaining healthy facial skin. Face products for men are not as much as compared to facial care products for women. Facial products for men have the same benefits as facial products for women, which are to deal with various facial skin problems. Just like woman, male has a lot of facial skin problems. Therefore, a lot of facial product for man are available on the market. (Pujasari, 2016). Men's face wash products are growing rapidly due to the demands of lifestyle, in Southeast Asia including Indonesia, those men who live in big cities now care about their health and facial appearance (www.marketing.co.id). The Nielson survey results showed that the male grooming market share grew significantly by 23% from 2013. These care products included hair styling, deodorant, cologne and skin care, the growth of the men's care product market can be seen in figure 1.3 (www.tirto.id). The growth of the male beauty industry Figure 1.3 The growth of the Men's Beauty Industry Source: www.Tirto.id Based on Figure 1.3 it can be concluded that the growth of the male beauty industry is increasing every year. In 2017 the growth of the men's care market reached $ 20.52 and in the next five years, it will reach $ 27.76. Estimated, 70% of men do not use facial and skin care equipment, but the interest in body and face care continues to increase (www.Tirto.id). So that this becomes an interesting phenomenon to be examined. Men's interest in wearing facial and skin care can be categorized as a purchase interest. The interest in purchasing according to Kotler and Keller (2012) in Priansa (2017: 16) is a consumer behavior that appears as a response to an object that shows someone's desire to make a purchase. There are a number of facial and skin care products that are usually used by men including moisturizer, facial wash, shaver and shaving cream, facial scrubs and sunscreen (Source: https://lifestyle.kompas.com). One of the easiest treatments to use is the face wash. Like women, men also need to do a basic facial treatments such as cleaning the face and moisturizing the face. Every day, facial skin is often exposed to pollution, including cigarette smokes. In addition, men tend to have more oily and thicker skin than women. Therefore, they need to use facial cleansers that are good and effective for all skin types. This becomes the background of men needing to use facial wash products (Source: lifestyle.kompas.com). The researcher conducted a preliminary survey on the use of facial wash products for men by interviewing 32 male sources and found out that 75% of men are using facial wash products while 25% of men do not use any facial wash products, as it can be seen in Figure 1.4 below: do you use male skin care? 25% Yes No 75% Figure 1.4 Survey data for male skin care user (Source: Processed by the author, 2018) Although most of the male skins have a low level of sensitivity compared to women, men do not spend a lot of time doing treatment, especially on the face. Men's face soap has several advantages compared to other facial soaps. The soap can be used to help men to shave. Some of them contain exfoliants which help reduce the occurrence of ingrown hair, and aloe vera which can soften the beard (Source: www.Hellosehat.com). Generally, a man normally washes his face with facial soap once a day in the morning before taking a shower or in the afternoon when he has done outdoor activities. It is not good for men to wash their face too often, this habit is causing several problems such as: the ingrown fine hairs on the face (beard, mustache, sideboards), acne, or oily skin. Wrong habits in washing the face can also cause irritation (Source: www.Hellosehat.com) This is the basis for fulfilling the needs of cosmetics for men, the number of requests for male consumers of cosmetics producers is aware of these opportunities, and from that manufacturers are starting to produce cosmetics specifically made for men. There are several cosmetic products that are used by men, for example, L'Oreal with Loreal Men Expert products and Garnier Man. And from one of the beauty products, there are also some products from Unilever such as Ponds Man and Vaseline Man, and some products from KAO such as Biore Man, also a Biersdorf's product: Nivea Man (source: www.viva.co.id). Figure 1.5 and Figure 1.6 show that the top brands of face wash in 2017 and 2018 can be seen in the following: Facial Wash BRAND Figure 1.5 Data Top Brand index 2017 (Sumber: www.Topbrand.com) Facial Wash BRAND Figure 1.6 Data Top Brand index 2018 (Sumber: www.Topbrand.com) As in the description of Figure 1.5 and Figure 1.6, the Garnier brand face cleaning products increased by 7% in becoming the Top Brand Index in Indonesia, marked by the beginning of 2017 the Garnier brand had not yet become a Top Brand and in 2018 the Garnier brand had been labelled as the top brand. This shows that purchase intention in Garnier is increasing. This purchase intention will later continue to consumer purchasing intention. Purchasing intention according to Schiffman and Kanuk (2010) in Priansa (2017: 214) define decisions like the choice of action from two or more alternative choices.
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