Hundreds of members of the beauty industry gathered at the New York Hilton Wednesday evening to hear Procter & Gamble Co.'s Susan Arnold, president, Global Business Units, discuss the company's beauty business, the state of the industry and some personal thoughts on what really matters to her.
In a Q&A format, led by Jill Scalamandre, chief marketing officer of Chrysallis, Arnold opened up the discussion by outlining P&G's vast businesses: The company consists of 300 brands generating more than $76 billion. More than 80 percent of P&G's annual sales and profits come from 41 brands that each generate in excess of $500 million. Twenty-three of them have sales exceeding $1 billion.
P&G's beauty business has doubled in the past five years, Scalamandre said, asking why P&G's recent focus has been on beauty. Arnold attributed the interest to the natural direction of P&G, a consumer packaged goods company, explaining that as branding and innovation serve as the company's core competencies, the two are also key to succeeding in beauty. What sets P&G's beauty business apart from competitors, she said, is its breadth of offerings, as well as the company's constant interactions with consumers. For instance, the company has witnessed firsthand women's beauty regimens, ranging from a woman's coveted Camay bar soap in Egypt to a woman's plethora of SK-II products in Japan.
Acquisitions also have been key to P&G's growth in beauty, a strategy Arnold has been a part of for 20 years. She noted that Frédéric Fekkai, P&G's most recent acquisition, was "admired from afar" as it is aspirational, has a great image and brand equity, has big repeats sales and has at its helm a man who's an icon in hair care. "We love icons," she said.
While P&G "plays to win, not to lose," a launch or an acquisition is not always financially motivated. As an example, Arnold cited Reflect.com, a Web site the company purchased in 1999 that was touted as the first to offer customized beauty products online.
"What we learned from Reflect.com...can be seen in olayforyou.com," a recently launched site that offers a personalized skin care routine tailored to a customer's specific needs.