By  on August 17, 2007

PARIS — Dr. Pierre Ricaud is working on a prescription to revive sales.

The Groupe Yves Rocher-owned treatment brand is banking on new markets, wider distribution and an image overhaul to return to growth after three years of stagnation.

While the direct-selling brand is the group's second biggest after the flagship Yves Rocher brand, sales are estimated to have hovered around 125 million euros, or $168.4 million at current exchange, since 2004, according to industry sources.

To kick-start growth, last October the Rocher family recruited Thierry Levallois, formerly managing director at LVMH Moët Hennessy Louis Vuitton-owned Guerlain, as managing director. "Among my objectives is to reduce our dependence on France, which makes us vulnerable," Levallois said.

With around 55 percent of sales generated in France, 15 percent in Russia and 13 percent in Germany, many European markets remain untapped, so plans are afoot to enter 14 new countries within four years. First up is Poland in September, which will be followed by Spain, Romania, Austria and Sweden in 2008. The brand is planning another attempt to crack the U.S. market, from which it withdrew last January due to sales difficulties.

While Ricaud, which was founded by a French doctor of the same name and Yves Rocher in 1986, preceded the recent raft of "doctor" brands, Levallois plans to capitalize on the segment's success for its European expansion. "It gives us a trendy image in our international markets," he said.

Antiaging facial care represents 67 percent of the brand's business, with body care (including sun-protection items) and makeup generating between 16 and 17 percent each.

In France, Levallois aims to reduce reliance on direct mailings and call centers, which bring in 90 percent of the business. Over the last year, Ricaud increased its freestanding salons in Paris from four to eight, doubling sales from January to May versus the previous five months. Four additional French doors are slated to open by yearend, while around 100 franchised salons are slated to bow countrywide between 2008 and 2010.

"With franchises we can develop our notoriety much more quickly," said Levallois.

Levallois also plans to update Ricaud's Web site, which receives between 15,000 and 18,000 orders a month and has a mailing list of 250,000 consumers.The brand itself is also undergoing an upgrade and taking on a masstige positioning. "We want to adopt all the codes of a luxury brand, save for price," explained Levallois. "That's the true definition of masstige."

Ricaud's white-and-black logo has been replaced with a white logo on a violet background to emphasize modernity, elegance and femininity, according to Claire Miller, marketing and communication director, who headed up the redesign.

In tandem with the introduction of its new look in September, Ricaud will launch Intervention Collagene, an antiaging cream for women in their 40s, a new demographic for the brand. "We were overrepresented when it comes to women in their 50s," explained Miller. "We need to conquer 40-year-olds and attract new consumers."

Inspired by cosmetic surgery techniques, Intervention Collagene contains an Acti-Collagene complex, Pro-Hyaluronic Acid and Vitalistine, designed to have a lifting effect.

"The Acti-Collagene complex contains enzymes which both eliminate damaged collagen while increasing the synthesis of new collagen," explained Anne Clément, Ricaud's scientific director.

Intervention Collagene will retail for 49 euros, or $66 at current exchange, for a 40-ml. jar. It will bow in October and a single-page ad campaign will break in September. A treatment protocol using Intervention Collagene will bow in the brand's salons, costing 85 euros, or $115, for a 90-minute massage.

While executives declined to reveal sales estimates, Levallois said Intervention Collagene, combined with two additions to the line in 2008, will generate around 15 percent of the brand's total sales.

For 2007, which Levallois designated "a year of restructuring," Dr. Pierre Ricaud is targeting growth of between 5 and 7 percent over 2006.

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