LOS ANGELES — A week after Liberty Media Corp. announced it acquired a stake in the Borba skin care brand, the investment has gotten a little sweeter.
The drinkable and topical skin care brand has inked a marketing, licensing and distribution deal with beverage powerhouse Anheuser-Busch to expand Borba domestically and internationally.
Terms of the deal were not disclosed, but Anheuser-Busch announced its wholesalers would start stocking Borba products — namely Aqua-Less Crystallines and Skin Balance Waters, which will be manufactured by the St. Louis-based Anheuser-Busch — in November.
“Adding the Borba Skin Balance Waters and Aqua-Less Crystallines to our portfolio allows us to participate in the emerging nutraceutical category,” said David Peacock, Anheuser-Busch’s vice president of business operations, in a statement. “The Borba line of beverages provides innovative and highly profi table products for our wholesalers and retail customers, while expanding our business in high-growth beverages beyond beer.”
Scott Vincent Borba, founder and chief executive officer of the namesake brand, explained that working with Anheuser- Busch provides Borba, a small California company projected to reach $20 million in sales this year, with previously unattainable leverage to enter retailers, spas and luxury resorts on a global scale. The brand, now carried in about 215 doors, including Sephora and Ulta, could be in as many as 30,000 doors by the second half of next year. Borba retains the rights to sell its beverages and crystallines in selected retail accounts and online.
“My hope is to carve out our own areas within the stores that will have the holistic internal-external approach. The nutraceutical category is totally different from anything else in the marketplace,” said Borba in an interview Monday. “We will have a premium, very visible presence.”
For Anheuser-Busch, cementing a partnership with Borba pushes the company into a type of beverage business outside its core competency at a time when wine is eating into beer’s dominance. Nielsen Monitor Plus reported that beer sales at food, liquor, drug and convenience stores for the year ended June 2 climbed 1.1 percent, trailing wine’s 2.7 percent growth rate.
In the second quarter this year, however, Anheuser-Busch’s gross sales were up nearly 6 percent, to $5.13 billion, from $4.85 billion for the same period the year before. To keep revenues chugging along, the company has stressed a willingness to extend its offerings into unexplored territories. “We will look at the total beverage landscape for other areas where our competitive advantages can drive sustainable growth, without the constraints of alcohol source, concentration or content,” wrote August A. Busch 4th, president and ceo of Anheuser-Busch, in the company’s 2006 annual report.
This story first appeared in the August 21, 2007 issue of WWD. Subscribe Today.
With Anheuser-Busch’s infrastructure support, Borba has retooled its packaging and formulations. Borba described the new look as “streamlined” and “superupscale” and noted that the products contain the latest ingredients — among them noni fruit and goji berry — making waves in skin care. “We utilized the best of what they had and the best of what we have to come up with the new designs,” said Borba. “The [product formulations are] revolutionary because of the technology that we now have at our fingertips.”
Liberty Media — via QVC parent Liberty Interactive — revealed last week that it acquired a minority stake in Borba, which has pulled in $5 million in sales on QVC in about a year. Industry sources estimated the investment to be around $5 million.
Speaking last Monday, Meade Rudasill, QVC’s chief operating offi cer, downplayed the role of a subsequent Borba deal in guiding Liberty Media’s strategy. “It was attractive, but I don’t think that was a decider in the deal. We are very comfortable sharing the risk [to help] a young company grow,” he said. “[Borba] had their own model that they are trying to grow. That is their call, and we are comfortable with that.”
Boss’ Take on Relationships
BERLIN — A new fragrance duo from Hugo Boss, called Hugo XX and Hugo XY, aims to play on the notion that opposites attract.
The two scents, which are slated for a global launch to begin next month, are meant to reflect the complicated blend of conflict, passion, contradictions, harmony, provocation and play that spice modern relationships.
The aromatic green men’s scent and the fl oral-woody blend for women are “unique and different but technically you could spray them together,” said Thomas A. Burkhardt, associate marketing director of global luxury and premium fragrances at Procter & Gamble Co. He contended that, like a contemporary couple, they fi ght but love and grow together.
More than a decade ago, when Hugo Dark Blue and Deep Red were launched, it was about “the hunt,” Burkhardt said. “The boy getting the girl, the girl getting the boy.
“Now,” he said, “the Hugo consumer is in their 20s and 30s. The hunt is over. They’ve got somebody. So the question becomes what is the sexy part of the relationship? Staying true to Hugo’s brand equity, which is very irreverent, we had to find something that wasn’t just romance and sex.”
The result: a champagne-toned XX scent and a silvery XY fragrance in complementary bottles inspired by the form of a spray can.
The XY scent surprises with a head note of pear leaves, a masculine heart of mint and basil and a woody cedar base with a typically Hugo-esque hint of pine. The XX fragrance starts off with a litchidominated top note, a creamy heart of basmati rice and sambac jasmine and a base of sandalwood.
The XY collection includes 2-oz. and 3.3- oz. eaux de toilette, priced at $49.50 and $65, respectively. Additionally, there is an aftershave lotion, 3.3 oz. for $47; an aftershave balm, 2.5 oz. for $37; a shower gel, 5 oz. for $27, and a deodorant stick, 2.4 oz. for $19.
The XX line features 2-oz. and 3.3-oz. eaux de toilette for $52 and $65. There’s also a body lotion and a shower gel, each 5 oz., for $36 and $26, respectively. Prices are for the U.S.
Burkhardt wouldn’t disclose first-year sales goals, but he said, “This is one of the biggest launches we have ever done. We have few brands that are bigger.”
Industry sources estimate the XX and XY scents could generate at least $40 million to $50 million in fi rst-year wholesale sales.
While the Hugo fashion line generates less than a 10th of total Hugo Boss fashion sales, in fragrances, the younger, cheekier Hugo brand is almost as big as Boss, Burkhardt pointed out. And, in some markets, like Mexico, Hugo is outpacing its older brother.
“In terms of [Hugo’s] largest market, it’s always a race between Germany, the U.K., France, Spain, Italy and the U.S.,” said Burkhardt. “And the highest growth is in markets like Mexico, Russia and China. It seems the brand is hitting a nerve.”
With XX and XY, he predicted the Hugo fragrance brand “will probably be double to where it was in 2004.”
A print and TV ad campaign has been produced to support the scents. Jonathan Rhys-Meyers is the masculine face of Hugo, and he is joined by Dutch model Bette Franke.
“The challenge was to fi nd someone who could stand up to Jonathan. He’s got presence,” said Burkhardt. “But with Bette, the moment you make her up and switch on the light, she’s there. She’s young, only 18, but in many scenes, she was dominating. She’s an amazing, down-to-earth girl.”
As Rhys-Meyers was in the middle of a film project in rural China, photographer Mario Sorrenti, Franke and the crew set up camp in a studio outside of Shanghai for the print ad shoot.
The TV spot was shot in Los Angeles by Chris Applebaum, known for his music videos for the likes of Jessica Simpson and Paris Hilton. Rhys-Meyers and Franke spent two days in a boxing ring “loving and fighting each other. They could get physical. It was good fun,” said Burkhardt. — Melissa Drier
Cowshed Coming to London
LONDON — Bath, body and treatment brand Cowshed will set up an outpost in London’s Soho this fall.
The brand is set to open a store on Fouberts Place close to Carnaby Street in September or October. The space will feature manicure and pedicure stations, a cafe and a retail area. The brand, whose products have bovine-inspired names, was developed in Babington House, which is part of Nick Jones’ chain of members clubs.
Another beauty shaker on the move in London next month is cosmetics brand Benefit, which will open a store on Shorts Gardens in the Covent Garden neighborhood.
Rodial Expands Face Care
LONDON — Prestige skin care brand Rodial is pumping up its premium facial care offer.
The London-based brand, which also is known for its tanning and body-care products, will introduce three items starting in November.
“A lot of our customers asked us to do [more] facial products,” said Maria Hatzistefanis, Rodial’s founder and managing director, adding the line grew out of the brand’s multipurpose ointment, Glam Balm.
The new items will be presented in silver packaging to underscore their premium positioning. Glamotox, an antiaging cream, will retail in the U.K. at 98 pounds, or $194 at current exchange, per 50-ml. pump bottle; A-List Cleanser will go for 48 pounds, or $95, per 100-ml. bottle and a pack of 25 Glam Wipes will be priced at 14 pounds, or $27.70.
A Rodial treatment procedure, dubbed A-List Facial, will bow at the Beauty Works West salon in London’s Notting Hill next month.