When a friend suggested that she enter L'Oreal cosmetics' second annual contest to find Miss Look of Radiance, Rusty Jackson laughed.

A former TWA flight attendant and IBM marketing support manager, Jackson said she had shunned beauty contests in general and those for black women in particular ("because most of them are so cheaply done"), but she decided to enter the L'Oreal event "as a lark."

More than 1,000 womem throughout the country had the same idea, and after a series of regional contests, 11 were called to New York (from whence the first winner came) for a final round of judging at the Stork Club. When the interviews were over, Rusty Jackson walked away Miss Look of Radiance 1979-80.

A native of Greenville, S.C., Jackson moved to Washington from Jacksonville, Fla., three years ago. The tall, slender 26-year-old Southwest resident best represents, according to a spokesperson for L'Oreal/Lancome of Paris, what the company calls the "look of radiance" for the modern black woman. Not coincidentally, Radiance is the name of the line of haircare products L'Oreal developed for black women.

What Jackson represents, according to company spokeswoman Alison Davis, is "someone who had her life in order -- someone who was special not only in the way she looked, but also in the way she conducted herself.

"It seemed to us that Rusty had clear goals and a lot of self confidence . . ."

"They said," Jackson confides, "that I possessed what seemed to be endless amounts of looks, personality and charm. And they thought it all seemed effortless. Well, it is effortless to be charming. I like people."

Along with her prize -- a one-week trip to Paris for two -- Jackson, who sells condominiums in the area finds herself plunged headlong into the midst of some pretty stiff competition for the loyalty and money of the black consumer buying hair-care and cosmetic products.

For years, Chicago businessman George Johnson dominated the multimillion dollar black hair-care market. Johnson Products introduced the now-famous Ultra Sheen line in 1954. For nearly 21 years, all the marbles in this game were his. Now that he has to compete with the big guys -- Revlon and L'Oreal -- he is not amused.

"It's a nightmare," Johnson says of L'Oreal's and Revlon's entry into what he refers to as his market and he readily acknowledges that he is no longer winning the battle for the black consumer's business.

"My problem with Revlon and L'Oreal is that with their products, they also bring a certain kind of clout which I simply cannot seem to wield. I see things happening in favor of these guys which will never happen for us."

The companies have used their names, he said, "and who knows what else" to get preferential placement for their products in stores. Johnson says that shelf space usually is alloted on the basis of a company's proven sales record, but that both Revlon and L'Oreal got two to three times more space than they deserved when their products first came on the scene.

Johnson wouldn't call the distribution problem a racial one, but he wouldn't say that race couldn't be a factor, either.

"I'm not gonna say. All I'll say is that these big companies use economic power along with their size to abuse this part of the market, and the organizations that own the various chains where this happens don't care. Perhaps it's also because the black companies are small and perhaps it's also because we're black."

But at both Revlon and L'Oreal, Johnson is considered serious competition because he has had a chance to develop strong loyalty among black consumers.

L'Oreal, which entered the market in June 1978, made the decision to get into black hair care after years of success with similar products marketed in Africa, Radiance product manager Hersey Eggington said.

"But," he hastened to add, "the Radiance line is a completely different formula which was developed specifically for the use of the American consumer."

Explaining L'Oreal's relatively late attention to what he called "a sizeable market for black hair-care products," Eggington said L'Oreal is a world-wide corporation whose American division "is really just a teeny drop in the bucket." He said L'Oreal is gaining on it's two chief competitors, Johnson Products Co. and Revlon. Revlon introduced its Polished Ambers Collection for black women in 1975.

Joyce Roche, Revlon's director of marketing for the Polished Ambers Collection, which includes a shampoo and conditioner along with a variety of cosmetics, said it is doing "exceptionally well all over and D.C. is one of our strongest markets."

Revlon jumped into the arena because they saw a growing market in which the black women constitutes a "very promising segment," Roche said. The line also has been successful in other ethnic markets, she added, because the products directly address consumer needs and then provide solutions. Unlike L'Oreal and Johnson products, the Revlon lines are sold in both drug and department stores, which, according to Roche, gives the company "an almost unparalleled opportunity to get equal treatment among both segments of the market."

"The Polished Ambers line is growing very fast -- we are defintely a major factor in the ethnic market and we are very close to being number one. Out in Chicago, George Johnson might tell you something different but we are difinitely on the move," Roche said.

Johnson is singing a similar tune. And he thinks that part of the damage to his business is the direct result of what he saw as a need to expand his hair-care line instead of getting into the cosmetics business at first blush.

"We had plans to do it in 1967," Johnson said in reference to bringing out a black cosmetics group, "but we had to put the whole thing on a back burner when the natural hairstyle became vogue and threatened our major business at that time.

"I had to stop everything and put together a line of products for the Afro hairstyle. But that turned out to be both a threat and an opportunity," he said in reference to the development of the product which was to become known as Afro Sheen -- still a big seller for the company. The cosmetics line finally came out in 1970.

Johnson's share of the market for black hair care products and cosmetics in 1978, the last year for which figures are available, was $41.1 million. Spokesmen for both Revlon and L'Oreal, both of which refuse to release sales figures, vigorously deny Johnson's allegations that they have captured their share of the market by using unethical tactics. In fact, both companies say, Johnson was the giant of the black cosmetic industry when they stepped in, and getting business away from him today is still a difficult undertaking.

"We're not trying to defeat him," Jim Nixon, a L'Oreal vice president says. "We're not even really competing with him. We prefer to think that we're competing for the customer."

Johnson's laugh is bitter in response.

"If they said that," he says, "then they weren't being truthful. Even in my back yard -- right here in some of Chicago's black neighborhoods, they've been able to get better play for their products. Right in my own back yard. They've done everything that they can possible do to us and they've not been ineffective."

Although his company's sales were down 16 percent in the past year, Johnson has not given up.

"I'm doing everything I can. I think about it and work on it day and night, day and night . . . and I plan to continue working creatively until I get my market back."

Meanwhile, Rusty, Jackson's main duty so far as Miss Look of Radiance is deciding when to go to Paris ("May would be nice, don't you think?") what to wear, and, oh yes, whom to take. It is, after all, a trip for two.

So, who else is going?

"Oh, I don't know about that," Jackson demurs as the Washington business woman suddenly recedes and the down-home girl from Greenville, S.C., who plans one day to be a wife and mother, comes out.

Sounding every bit the debutante looking over a nearly full dance card, she smiles faintly and says, "We'll just have to wait and see who's around when the time comes."