Answered: in 2008 L'Oréal bought Maybelline NY…

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

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in 2008 L'Oréal bought Maybelline NY which kind of development strategy was it? a) vertical integration b) horizontal integration c) market penetration d) differentiation

Expert Solution

Step 1

vertical integration: Vertical integration is a business development strategy where a company acquires another company in product development stages or distribution stages to achieve smooth an efficient supply chain chain management. as an example, we can say vertical integration happens when a furniture making company takes the ownership of a land with trees so that they can negate the problem regarding getting raw materials such as IKEA taking ownership of a forest in Romania.
Horizontal Integration: Horizontal integration happens when a company acquires another company which is working on similar market and attracting same target audience group. in simple terms when a company acquires their direct rivals from the market, horizontal integration happens. Byjus, the leading ed tech farm from India buys Aakash, another educational farm to enhance their market growth, this is an example of horizontal integration.
Market penetration: Market penetration is a strategy of entering in a already existing market with a product which is already available in the market. there are many ways are present for market penetration, such as:

1. price skimming.
2. horizontal integration.
3. developed marketing strategy.
4. developing the product and its value offerings. etc.

Differentiation strategy: When a company tries to be unique in the market with their product offerings or their marketing strategies and promotional method to gain competitive advantages, then the market differentiation happens.

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