NEW YORK — Luring beauty shoppers from other outlets, learning about Coty's plans for Del Cosmetics and finding that one item that could be the next big hit are the three top goals on retailers' to-do lists as they head to San Diego for the National Association of Chain Drug Store's Marketplace meeting.
The meeting kicks off Saturday, with Meet the Market, one-on-one appointments that are seen as golden opportunities for fledgling beauty brands to get their 10 minutes of fame with a buyer.
So crucial is the time to see new brands that manufacturers said Wal-Mart is sending some buyers who plan to meet only with new firms. This is the fifth year of Meet the Market and NACDS expects 10,000 face-to-face meetings among 400 exhibitors and more than 300 retailers representing 80 companies.
Retailers said they are on the prowl for something different they can use to make their stores stand out. "Everyone's looking for something 'special, different.' I think it's going to be a very challenging second half," said one top merchant.
Although she said large chains shouldn't be first seeing a new item at Marketplace, she did say the meeting still serves as a great locale to gauge the pulse of the market. Another said she is eyeing programs that can help her chain "get more of the pie." She said she's faced with some of the highest gas prices in the country and highest unemployment rates. "Our number-one goal is to drive sales," she said.
Tom Winarick, executive vice president with Prestige Cosmetics, who will not be exhibiting, said the major issue retailers face is the economy, specifically energy costs and all that impacts. "Shoppers are starting to count their pennies more closely and this is affecting not only front end, but pharmacy too," he said. Fewer pharmacy visits translate into lower front-end volume, he pointed out. "The energy cost increase also impacts their operating costs ranging from overhead to transportation from warehouses to stores. Retailers have to become even more aggressive promotionally to stimulate sales," Winarick explained. On the bright side, he said, mass beauty has always prospered during lean economic times.
For the 52-week period ended May 17, food, drug and mass sales of cosmetics (excluding Wal-Mart) rose 1.8 percent to $2.76 billion, according to ACNielsen. That was a smaller growth rate, however, than the same period last year when volume rose 3.3 percent.But industry consultant Allan Mottus isn't so sure that is true this time. "I think we are finally coming to the conclusion that pricing [in mass] is too high," he said. "Retailers were hoping a stretched shopper would trade down from department stores and that is happening, but they are going to Sephora and Ulta," he said. "And some are just trading out of the category." He said that Sephora's price points on its private label brand are low enough to compete with higher-end mass lines.
He believes mass merchants are trying to figure out what they want to be — the higher-end of the mass market or a value stop. CVS, Mottus said, is definitely pursuing the higher end, as the chain has been aggressive with new and exclusive launches.
Although the quest is for new, it is a mature market leader that many retailers want to meet with during the four-day gathering — Coty. As Coty absorbs Del Cosmetics, retailers want to know more specifics of its future plans. Coty did outline some of that at the Annual Meeting, but to top executives. Now those in the trenches want to know the score. Many urged Coty to keep some of the strong people in place, although Coty has announced many reductions in staffing. One top insider said the best idea for "The New Coty Beauty Company" is to keep much of the old. "They have a good business going as long as they don't try to reinvent everything," said one retailer who asked not to be named. Another source who also wanted to remain confidential wondered if three beauty brands are needed from one company, referring to Rimmel, NYC Color and Sally Hansen. Several buyers said they hadn't been brought up to date on Coty's plans or a new direction.
This year, Marketplace will bring together more than 250 retail companies representing over 145,000 stores with 675 manufacturing companies across 11 major retail categories. Marketplace represents more than 90 percent of the industry. "Along with the Successful Selling conference in the winter, Meet the Market gives exhibitors a chance to open doors with a wide range of retailers," said NACDS president and chief executive officer Steven C. Anderson.Still, there are a few beauty players sitting Marketplace out. Since it is such a big show, a few small firms feel they are overlooked and that it is an expensive meeting to attempt to get an audience with what has become an industry dominated by few players. "I'm wondering if it was the right decision," said one New York-based firm who passed on this year's event. "But I can get to most of the accounts in person now so I'm putting my budgets into travel to accounts. Still, being at Marketplace does give you an important presence...maybe next year."
"'Dynasty' is all about gowns, the diamonds and the scandal, so it's a bit like the fashion industry. When we come to Cannes it's all about the red carpet dresses too, so it all fit really well," said designer @philippplein78 on the theme of his high-glamour resort 2019 show at his mansion in Cannes. #wwdfashion #cannes (📷: @zefashioninsider)
"I think Spike is such a brilliant director because he holds up a mirror to society and reflects these issues, yet he doesn't shove it down your throat, he doesn't tell you what to think," says @lauraharrier on her latest film @Blackkklansman. Harrier was at the Cannes Film Festival – for the very first time – with @officialspikelee. #wwdeye #cannes (📷: @zefashioninsider)
“I would think to myself, Are you happy? Yes, I’m wildly happy. I go to this studio every day and, in my inside voices, I’m giggling; I’m singing. Yes, it’s a lot of work, it’s a [huge] volume of material. It wouldn’t be for everybody. But I was very happy,” said soap opera star @therealsusanlucci of checking in throughout the years with her career trajectory. Lucci spoke to WWD about her decades-long career, love for pilates, motherhood and her QVC activewear line. Read Bridget Foley’s full piece on Lucci on WWD.com #wwdfashion (📷: @celestesloman)
@balmain has taken a stand at the #cannes Film Festival, dressing 16 actresses at a press call for the project “Noire N’est Pas Mon Metier,” or “Black Is Not My Profession.” The multimedia project includes a book, photo exhibit and documentary, which aims to expose discrimination in the French and American entertainment industries. “The moment I was asked to participate, I knew it was right for me, and for this brand, to form a part of this moment,” Balmain creative director @olivier_rousteing told WWD. #wwdnews #wwdfashion
"I always feel curious and I feel like there's more to learn. But I think being relevant, feeling relevant, I personally always feel that there's just so much more to know. And maybe that's the key.” — @themarcjacobs #wwdsummits #wwdbeauty (📷: @patrickmacleodphoto )
“The most amazing thing about her is that, regardless of all the things that have happened to her, her spirit is so undaunted by all of it. She is the most cheerful person you will ever meet. She doesn’t see problems, she only sees solutions,” said @ajanaomi_king of activist Ifrah Ahmed, who she plays in a new film “A Girl from Mogadishu.” WWD caught up with King at Cannes — Head to WWD.com to read more about her new role, personal style and how she uses social media for causes like Time’s Up and Black Lives Matter #wwdeye
WWD asked a number designers to share their thoughts on what Meghan Markle’s wedding gown will look like this Saturday. Here, Valentino’s Pierpaolo Piccioli sketches his look. #wwdfashion #royalwedding #meghanmarkle