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Inside View on the International Beauty Industry January 21 - February 3, 2016 #124

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Inside View on the International Beauty Industry January 21 - February 3, 2016 #124 www.bwconfidential.com The inside view on the international beauty industry January 21 - February 3, 2016 #124 CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL Comment Inside The buzz 2 The millennial maze News roundup eauty companies have made the millennial consumer Netwatch 7 Ba key target. Many brands are going out of their way to attract 18 to 34 year olds on social media—with Social media monitor varying degrees of success—and are looking at how to better design, market and even price their products to Interview 8 appeal to these consumers. La Prairie Group vice president of However, analysts say that while brands are making travel retail Laurent Marteau efforts when it comes to millennials, there is a disconnect at the point of sale. They maintain that traditional Insight 10 beauty stores are not attractive enough to bring in these Prestige retailing in Italy consumers, and that millennials do not feel at ease shopping in a perfumery or a department store. Young consumers are either buying elsewhere (for example, Store visit 13 online or in branded standalone stores) or are simply not buying beauty at all. Grupo Boticário’s The Beauty Box This criticism has seen some retailers look to open more youth-friendly stores flagship, São Paulo, Brazil complete with interactive elements and digital features. The problem however, is that these special features are usually only to be seen in key flagship doors, while many of the local perfumeries do not get the same treatment and continue to have a tough time attracting the young consumer. Oonagh Phillips Editor in Chief [email protected] Meet the BW Confidential team at: l PCD, Paris, Feb 3-4 l Cosmopack, Bologna, March 17-20 l Cosmoprof Worldwide, Bologna, March 18-21 News headlines daily on www.bwconfidential.com @BWCbeautynews News roundup At a glance... n Coty not to take over D&G and Christina Aguilera fragrance licenses n Revlon owner seeks strategic alternatives The buzz n Douglas ceo Henning Kreke is to step down n Retailer BHV Marais to open a store in Dubai, UAE this September Stay informed with our daily news headlines on www.bwconfidential.com Strategy Coty will not take over the fragrance licenses for Dolce & Gabbana and Christina Aguilera as part of its acquisition of P&G’s Specialty Beauty business. “The licensors […] did not provide their consent within the specified timetable, and in accordance with the transaction agreement and in the interest of staying on track with the transaction, it was agreed that these brands will not transfer upon completion of the merger,” Coty said in a statement. Coty’s assumption of debt from the P&G Specialty Beauty business will be adjusted downwards, the company added. The transaction is still on schedule to close in the second half of this year. As announced previously, discussions with 10 of P&G’s fragrance brand licensors have been successfully concluded, meaning those licenses will pass to Coty as planned. They are: Hugo Boss, Gucci, Lacoste, Bruno Banani, Escada, Mexx, James Bond, Gabriela Sabatini, Stella McCartney and Alexander McQueen. MacAndrews & Forbes, through which US businessman Ronald Perelman owns 77.6% of beauty firm Revlon, is looking for “strategic alternatives” for the company, according to an SEC filing. According to the filing, no specific plan has yet been formulated. Revlon saw a reported sales drop of 3.3% in the first nine months of 2015 to $1.39bn. In 2014, the first full year in which its sales integrated those of The Colomer Group, revenues grew 1.7% on a pro-forma basis (adjusted to take the acquisition into account). LVMH has put its resources behind a new sustainable well-being brand, called Cha Ling. The group will give Cha Ling financial backing and develop its products at its La Rûche laboratory in France. The Sino-French brand is based on an exclusive type of tea called Pu’er, from forests in China’s Yunnan province, which is renowned for its anti-oxidant properties. Its concept is based on sustainable sourcing of ingredients and has a focus on overall well-being inspired by traditional Chinese medicine. Guerlain president Laurent Boillot is also Cha Ling’s president, although he explains that the brand is an independent entity incubated by LVMH, rather than a new brand in the luxury-goods house’s stable. “Its vocation is to be a global brand, not a brand for the Chinese market,” Boillot adds. The brand has been four years in the making, he says. Cha Ling launched exclusively at Le Bon Marché in Paris on January 8 with a permanent space, as well as a larger pop-up store running from January 11-23. The line consists of a range of 22 face and bodycare products as well as a fragrance, and also includes a n n n www.bwconfidential.com - January 21 - February 3, 2016 #124 - Page 2 CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL News roundup n n n candle, ceramic objects and a selection of teas. It offers massages and meditation solutions. The core products in the line are a cleansing powder, a serum, a massage cream, a steam tablet and a rejuvenating mask, with prices ranging from €20 for the steam tablet to €150 for the Infusion Serum or Massage Cream. The buzz Rollout plans for Cha Ling include French e-commerce, to launch on January 25, and a boutique in Hong Kong’s Harbour City mall set for January 27. Boutiques in Paris and Hong Kong could also be on the cards further down the line, as well as a store in China in 2017 and Chinese e-commerce, Boillot says. Packaging manufacturer HCP has been acquired by investment firm Baring Private Equity Asia, a source at the company has confirmed. Baring bought the firm from TPG Capital Management for a reported $775m, according to press reports. Elizabeth Arden Red Door Spa is continuing to hone its on-demand services offer with a second acquisition in the space. It has announced the purchase of CitiMani, an on-demand nail care service in New York. The move follows the November purchase of in- office beauty and grooming services firm Manicube. CitiMani will be incorporated into the firm’s new on-demand services division, headed by Manicube founders Katina Mountanos and Liz Whitman. CityMani offers private and small group manicure parties. Beauty sampling service and retailer Birchbox has launched its second private-label line. Called Arrow, the make-up and skincare line is inspired by the athleisure trend, with products designed to be lightweight, long-wearing and refreshing for use during and after physical activity. The vegan line launched on January 7 with three products—Revive Cooling Cheek Tint, Boost Color Enhancing Lip Balm and Protect Aluminum-Free Deodorant, as well as a make-up bag, and is also available as a starter kit. Prices for the individual products range from $9 to $18. Later this spring, five further products will be added to the line: a facial mist, mascara, cleansing wipes, a tinted serum and a tinted brow gel. BW Confidential 4 avenue de la Marne 92600 Asnières sur Seine, France Results [email protected] Tel: +33 (0)1 74 63 49 61 Fax: +33 (0)1 53 01 09 79 www.bwconfidential.com Germany’s Beiersdorf reported a 6.4% increase in preliminary 2015 sales, to €6.69bn. ISSN: 2104-3302 Publisher: Nicolas Grob In organic terms, the company’s sales grew 3%. For the consumer business segment, Editorial Director: Oonagh Phillips which includes the firm’s beauty brands, sales grew 6.5%, or 3.6% on an organic basis, [email protected] Editorial Coordinator & Assistant: to €5.55bn. Beiersdorf said its growth had accelerated in the second half of the year. Katie Nichol [email protected] Its core brands Nivea, Eucerin and La Prairie contributed to growth in 2015. Consumer Contributors: Sophie Douez, Alex Wynne, Renata Ashcar, Mayu Saini, Raphaëlle Choël, division sales in Western Europe increased 1.7% to €2.28bn, while in Eastern Europe they Corinne Blanché, Naomi Marcoulet fell 3.5% to €535m. In North America, the division’s revenues increased 22% to €426m, Subscriptions 1 year: electronic publication (20 issues) + and in Latin America, they rose 4.1% to €650m. In Asia, Africa and Australasia, sales print magazine (4 issues) + daily news: €499 or US$699 grew 15.1% to €1.65bn. [email protected] Advertising [email protected] Anglo-Dutch group Unilever reported sales of €53.3bn for 2015, a 10% increase year- BW Confidential is published by Noon Media 513 746 297 RCS Nanterre on-year, boosted by a positive currency impact of 5.9%. The company saw underlying Copyright © 2015. All rights reserved. Reproduction in whole or in part without sales growth of 4.1%, ahead of its markets. Operating profit for the year fell 6% to permission is strictly prohibited. €7.5bn, while net profit dropped 5% to €5.3bn. n n n www.bwconfidential.com - January 21 - February 3, 2016 #124 - Page 3 CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL CONFIDENTIAL News roundup n n n Sales at its personal care division rose 13.2% on a reported basis to €20.1bn. Like- for-like sales for the division grew 4.1%, with exchange rates accounting for 7.6% of growth and acquisitions for 1%. Unilever said growth for the division improved compared with the previous year thanks to innovations from its core brands and its extension into The buzz more premium segments. The company bolstered its position in prestige skincare in 2015, acquiring Kate Somerville, Dermalogica, Murad and Ren. People Douglas ceo Henning Kreke is to step down and become chairman of the retailer’s supervisory board.
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