By  on September 26, 2007

Beauty.com Undergoes Revamp

NEW YORK — Beauty.com is undergoing a facelift.

The eight-year-old Web site, which Drugstore.com acquired in 2000, went live earlier this month with a new home page and plans to roll out new features between now and November, wrapping up the site's relaunch prior to the holidays.

The changes are designed to make the e-commerce site easier to navigate and to better organize its content, according to Kathleen McNeill, vice president and general manager of Beauty.com and vice president of beauty for Drugstore.com.

"It's a rolling approach," she said during an interview Monday. "Our customers are shopping more and more online for prestige beauty, which is an impulsive, emotional purchase, so we wanted to provide the best shopping experience."

The site boasts more than 200 prestige beauty brands, including Elizabeth Arden, Nars, Frédéric Fekkai, Fresh, Philosophy, Urban Decay, Tarte, Kevin Aucoin, Murad, Brandt, Vincent Longo, MD Skincare, Elemis, Somme Institute and Ted Gibson.

"We have added over 30 prestige beauty brands in the last six months," Dawn Lepore, chairman and chief executive officer of Drugstore.com, said in a recent earnings statement. She added that in an effort to grow earnings next year "we continue to expand beauty."

Both Beauty.com and Drugstore.com carry beauty products, but Beauty.com carries the brands with a prestige positioning while the mass brands are available on Drugstore.com. Each site has a link to the other.

Drugstore.com had revenues of $415.8 million last year and, while the firm does not break out sales of Beauty.com, industry sources estimate Beauty.com might generate 5 percent of revenues, or nearly $21 million.

Some of Beauty.com's new features include magnification and multiple product views to help visitors see things like shimmer and texture, a fragrance finder where one can search by fragrance categories like floral or woody and expert advice from the founders or executives of different brands.

Currently, the site features content from hairstylist Ted Gibson; Carol Shaw, the founder of the Lorac brand, and Dennis Gross, founder of MD Skincare.

There are also behind-the-scenes video clips from fashion shows, such as the recent Lela Rose spring presentation. The aim, according to McNeill, is to show customers "how to get the looks and what the current trends are."Seven years ago, "People were cautious about shopping online," said McNeill. Now, "more and more people are comfortable using the Internet." She said the Web is "one of the fastest growing retail channels" because consumers are more pressed for time and see shopping online as a "convenience."

Moreover, "Our customers are becoming aware of the relationship" between Beauty.com and Drugstore.com, said McNeill. She said Drugstore.com beauty customers "trade up" to items on Beauty.com and vice versa. Also, "We're focused on converting Drugstore.com customers to Beauty.com and getting new customers to Beauty.com.

"Nars and Fekkai are in the same shopping cart as Maybelline," McNeill noted. "That's really the way people are shopping."

In the quarter ended April 1, Drugstore.com experienced a net loss of $3.8 million, or 4 cents a diluted share, on record quarterly net sales of $109.8 million, up 5.4 percent from the year-ago period. Sales were driven by over-the-counter revenues of $56.3 million, which include beauty.

"Ultimately, the idea is it can add to the revenue stream and profitability of the business," analyst Mark Argento at Craig-Hallum Capital Group LLC in Minneapolis said of the Beauty.com relaunch. "Online is an area of growth and their core customer is the urban female, who is focused on these brands. This represents a significant opportunity to grow.

"From a margin perspective," Argento added, "[upscale beauty items] carry a higher gross margin than traditional drugstore products. [The Beauty.com basket] is materially higher than the traditional basket at Drugstore.com."

In October, Beauty.com plans to go live with areas of the site designed to address specific skin and hair concerns. In November, it plans to launch an ingredients glossary and give visitors the ability to search for beauty products by ingredient.

"We'll continue to evolve with cutting-edge technology," said McNeill, "to be the premium place to shop online for prestige cosmetics."

Venustas Changes Name to Batallure

NEW YORK — The creative development beauty company formerly known as Venustas International on Friday changed its name to Batallure Beauty, according to principal Robin Burns.As reported in July, the original name was embroiled in a lawsuit filed against it by Aedes de Venustas, a specialty manufacturer and retailer of fragrance and bath and body products, in a Manhattan federate district court. U.S. District Court Judge Laura Taylor Swain on Sept. 11 ruled against Burns' company, granting Aedes de Venustas a preliminary injunction barring Burns' company from using Venustas International, as well as any new business name incorporating Venustas.

Burns said that since she was working with suppliers and retail clients, there was no infringement since her company's name would never be before the public. The court disagreed, stating that most of the criteria used in determining trademark infringement were in Aedes de Venustas' favor, in particular, evidence of actual confusion among customers.

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