BW Confidential - Issue #6 - May/June 2011 - (Page 16)

Best of BW highlights BW Confidential delivers an electronic publication by email to subscribers every two weeks, with a focus on analysis of major issues facing the international industry, interviews with key players and insight into new trends. Here we bring you excerpts of some of our reports. To see the articles in full log on to our website www.bwconfidential.com www.bwconﬁdential.com The inside view on the international beauty and wellness industry September 2-15, 2010 #21 CONFIDENTIAL Comment Inside The buzz The essential news roundup The retail view Wellness focus Changing channels f the industry needed any more proof that retail models are changing and consumers are buying differently, it only needs to look at the launch of the new Mary J Blige fragrance. US company Carol’s Daughter, which developed the scent, took the brave step of launching the fragrance exclusively on TV shopping channel HSN, and so without the US’s traditional launch-pad, the department store. The company can’t be disappointed with the results: in just six hours of airtime the fragrance had sold 60,000 units and broken HSN records for fragrance volume sales. Brands looking beyond traditional distribution is nothing new, but what is interesting is how successful new channels are becoming. Alternatives in the US, such as Sephora and Ulta, may not have the same footprint as department stores, but they are increasingly popular, and their websites are attracting more consumers who may not have a brick-and-mortar version nearby. As for TV shopping, it also has broad reach, provides brand awareness and is considered a lot more cost-efﬁcient than the department store. One brand manager recently told BW Conﬁdential that companies can simply no longer afford to pay for staff at department stores and all the other extras they ask for. And perhaps more worrying for the department store is that brands are now less afraid of upsetting these retailers by dabbling in other types of distribution. Oonagh Phillips Editor in Chief ophillips@bwconﬁdential.com 2 4 4 5 6 I Netwatch The beauty blog review Interview Clinique vp & gm Europe, ME & Africa Jean-Christophe Jourde Beauty insight Market outlook 8 11 Store visit House of Fraser’s Apothecary Subscribe www.bwconfidential.com on p.13 or go to Beauty insight Social commerce There’s been much talk about the power of Facebook and other social media as a communication tool. Sooner or later this talk ends up with the question of how to monetize Facebook’s buzz, or how much a fan is worth. The answer may lie in social commerce. It’s easy to understand why Facebook is beginning to be seen as a distribution channel; it is where consumers are congregating and selling on Facebook would allow companies to reach a new audience and market in a more personalized way. Cosmetics & fashion stores Fashion retailers’ beauty offers have moved well beyond the single signature fragrance and these stores are now seen as a burgeoning distribution channel for in-house and third-party beauty brands. Beauty is a high-margin category and allows these retailers to increase sales without cannibalizing their core business. As France-based privatelabel manufacturer Maesa ceo Julien Saada points out, growth of 2-5% in fashion stores is good for a category that doesn’t take up much room and can bring a lot in terms of image. Mexico market The crisis may have spoiled the Mexican beauty market’s record of double-digit growth seen in the past few years, but it also highlighted the sector’s strength. Despite the recession, Mexico’s prestige beauty category, which is worth around $200m wholesale, still managed to report growth of 8.4% in value sales in 2009 (although unit sales were flat). The situation also improved throughout 2010, with sales at the end of September having increased by 9.1% in value and 3.8% in units. 16 Major groups & naturals The natural and organic beauty market is still seeing double-digit growth, with global manufacturers’ sales expected to reach $23bn in 2010 with a CAGR of 15% over the past five years, says Kline & Company. But how implicated are the major beauty groups? There is an interest in naturals, but overall they have been slow to act and the buzz is still largely centered on small firms. As one industry player says: “the majors are coming around to natural and organic, but each at its own speed”. May-June 2011 - N°6 - BW Confidential http://www.bwconfidential.com

Table of Contents for the Digital Edition of BW Confidential - Issue #6 - May/June 2011

Cover
Comment
Contents
Update
- Brand & retail news recap
- Digital digest
- Companies on the move
Take note
- Market facts, figures & trends
Best of BW
- Highlights from our e-publication
Launches
- The latest in fragrance, skincare & make-up
Interview
- Puig ceo Marc Puig
Insight: Skincare
- Category overview
- Department store initiatives
- Perfumeries
- The latest trends
Wellness
- Discounting in spas
- Spa case studies
Retail
- New store concepts
Travel retail
- Market analysis: Asia & Middle East
- Chinese travelers
Radar
- Four up-and-coming beauty brands
Market watch: China
- Analysis: country overview
- Industry roundtable
- Prestige retailing
- E-commerce
Packaging
- Decoration techniques
Last word
- LPK Beauty vp group creative director Liz Grubow

BW Confidential - Issue #6 - May/June 2011