Of the L’Oréal Groupe’s roughly $44 billion in annual sales, one quarter of its business comes from the U.S. market alone. L’Oréal believes it can do more to serve those consumers. On Thursday, the French beauty conglomerate fully opened a 250,000-square-foot research and innovation center in New Jersey. Located in the city of Clark, the center is L’Oréal’s largest facility outside of France.
L’Oréal has invested $160 million in the New Jersey research center, which joins global research hubs in the likes of Brazil and South Africa. L’Oréal first broke ground on the new center in 2022, building on its existing office space in the area, and opened it to employees in 2023 before fully opening it this week.
“The U.S. plays a defining role in shaping the future of beauty. With its diverse and demanding consumers and world-leading innovation ecosystem, it is the ideal environment to drive our vision forward,” said Barbara Lavernos, deputy CEO of L’Oréal Groupe, in charge of research, innovation and technology. “This center embodies L’Oréal’s uniquely end-to-end innovation model, from upstream advanced research on new breakthrough ingredients to the downstream development of formulas ready for scale-up to deliver high-performance, safe and responsible beauty solutions.”
L’Oréal North America chief innovation officer Patrick Kullenberg stated that 3% of the company’s net sales are devoted to research and innovation, such as those found at the New Jersey center. The new R&I hub houses a 26,000-square-foot modular laboratory covering all beauty categories, from hair care to color cosmetics, with a particular emphasis on the group’s American brands like Kiehl’s and Redken.
“The U.S. is a very strategic and important market for the company. It’s a quarter of our sales, but most importantly, it’s the only developed market that has a projection of true population growth and opportunity in the beauty business,” said Kullenberg.
Key to the company’s research efforts is reaching an increasingly diverse and multicultural U.S. population. According to L’Oréal, the U.S. will be home to an additional 12 million consumers by 2030, a growing number of which will be multi-racial. At present, L’Oréal stated that 50% of Gen Z has curly hair. L’Oréal’s research efforts to better serve a more ethnically diverse population include developing foundation shades and studying the construction of hair types ranging from straight to curly.
“These multicultural consumers are a pivotal group for us to win, particularly in the U.S.,” said Tiffany Giddins, avp of consumer markets insights for R&I at L’Oréal. “We know that these consumers are very important for the beauty culture. These are the consumers that are setting the trends in the beauty space.”
In addition to researching formulations to serve more ethnically diverse consumers, L’Oréal is also investing in areas of growth such as longevity supplements and beauty devices. The latter includes Hapta, which is designed to assist those with limited mobility in applying makeup and is slated to be available this summer. The New Jersey facility will also house consumer testing sites to gain feedback such as emotional responses to fragrance and skin-care efficacy.
The New Jersey site will be home to 600 scientists, joining L’Oréal’s roughly 10,000 U.S. employees. Green science like biotech will also be a key area of growth for the company as it seeks to separate from its competitors.
“The beauty industry has grown on marketing innovation over the last 20-30 years, and product innovation has been very, very low,” said Josh Britton, founder and CEO of biotech company Debut, at the New Jersey center opening. “And that’s because everyone has the same old ingredients and the same old contract manufacturers. So, how do you stand out as a brand? Well, you have to invent new ingredients, new textures and new products.”
