L’Oréal’s Megan Grant on Pivoting From Department Stores to Digital

Having to shut down 95 percent of its brick-and-mortar distribution for almost an entire quarter due to the global coronavirus pandemic certainly wasn’t an ideal situation for L’Oréal Luxe. Yet the company made the best of it, said Megan Grant, president of L’Oréal USA Luxe at L’Oréal USA.

The division’s brands — which include Yves Saint Laurent Beauté, Giorgio Armani, Kiehl’s, Lancôme and It Cosmetics — are department store staples, and when nonessential businesses in most states were forced to close in mid-March, a pivot to digital was critical.

Grant detailed a few key learnings from her division’s sharp pivot. A L’Oréal veteran, she noted that she’s seen the business progress more in the past three months than it has in the past decade.

Leveraging the brands’ field teams was critical in moving business online, Grant said. Virtually “overnight,” L’Oréal tapped insight from 300 of its field team members and trained them in digital community engagement and customer service.

“The field team is interacting with consumers on a daily basis every day, all day in stores. Their knowledge of consumer insights was immeasurable in this moment in time,” she said. “They understood the priorities and concerns and needs of consumers like nobody else on the team and those insights were incredible and big assets to us as we started working to transform our business model.”

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One of the key insights that came from listening to the field team was that consumers are demanding to know what’s in the fragrance they are buying. “[Online] on our [product descriptions], we had ingredients listed, but only key notes — that’s not what they were asking for,” said Grant, who noted that after hearing this insight from the field team members, the Luxe division immediately updated the product descriptions on its web site to include more fragrance ingredients. Nearly immediately, this resulted in more engagement and more purchases.

The Luxe division also needed to translate the in-store customer service experience to online. This translated to three key needs, said Grant — getting a makeup or skin-care consultation virtually, the ability to try-on product safely at-home, and the ability to get questions answered on the spot.

Grant’s team launched a virtual consult feature using members of the department store field team. It was an instant hit, with a 99 percent customer satisfaction score — higher than any other virtual feature Grant said her team has launched. Virtual live chats, where customers could get questions answered quickly, were launched on Kiehl’s and It Cosmetics.

Her team also worked quickly to develop digital diagnostic and try-on tools, such as the Kiehl’s Healthy Skin Finder, which “immediately had a tremendous amount of traffic flowing through it,” and an Armani Foundation Finder, which grew online foundation sales by triple digits mid-pandemic.

“From a business point-of-view, we had an average higher order value than we normally see with purchases online,” Grant said.

The pandemic has been challenging, but has in a sense pushed L’Oréal out of its department store comfort zone and into a new realm of online purchasing, with surprisingly successful results. Now, Grant said, her teams are working on formalizing and optimizing the many digital initiatives launched during the store closures.

“We used to sit around the conference table and wonder how we’d ever get people to buy fragrances online,” she said. “When in reality, we just had to try and see what worked, and lo and behold we’ve been able to develop a very strong fragrance business online.”

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