Vichy Laboratoires is a 77-year-old brand with an adventurous spirit.
This story first appeared in the July 18, 2008 issue of WWD. Subscribe Today.
Five years ago, the L’Oréal-owned French skin care brand spotted an opportunity to participate in the evolution of U.S. drugstores’ approach to beauty retailing.
Unlike their peers in Canada and throughout Europe, U.S. drugstores stocked their beauty departments exclusively with mass market goods and measured their success in sales per linear square foot.
But Vichy, along with several French brands like Pierre Fabre’s Eau Thermale Avène, had a vision of doing things differently.
Enthusiastically pointing to the success of the upscale beauty assortment at Canadian drugstore chain Shoppers Drug Mart, Vichy helped to convince Brooks Pharmacy (which is now owned by and fully integrated into Rite Aid), and CVS Pharmacy to outfit a handful of their stores with a dermatological skin care center, manned by a trained beauty adviser. After all, eight years ago Vichy was at the forefront of Shoppers Drug Mart’s shift into a purveyor of both mass market and prestige beauty, according to the skin care firm.
“The idea was to create an appropriate channel [for Vichy] in the U.S., where there would be product samples, testers and beauty advisers within drugstores. Vichy is a great bridge between department stores and the mass market,” said Maeve Coburn, who at the time of the interview was general manager of Vichy and Dermablend. Effective July 1, Coburn assumed the role of general manager of Kérastase and Shu Uemura, which also are owned by L’Oréal.
To date, Vichy has expanded the concept to more than 700 doors across Rite Aid, CVS, Duane Reade and Longs Drugs. It is also available via vichyusa.com, which accounts for 16 percent of U.S. sales. By year’s end, Vichy expects to have a total store network of 1,000 doors.
The presence of the dermatological skin care centers has elevated drugstores’ beauty departments, noted Philippe Patsalides, general manager of Active Cosmetics USA, the L’Oréal division that houses Vichy. Drugstores “are perceived as convenience stores, but they are working to change into beauty destinations.”
Drugstores’ deep dive into wellness, he noted, ties into Vichy’s heritage. A sign in his office reads: “Vichy: Dedicated to health since 1931.”
Each of the products are formulated with mineral-rich water, sourced from the thermal spas of Vichy, France, where the products are made.
Vichy has a strong presence throughout Europe and Canada, where it holds the distinction of number-one skin care brand, said Patsalides. It also is sold in high-growth markets like China, Russia and Brazil. Globally, Vichy is a $1.3 billion brand, and aims to grow to a $50 million brand in the U.S. over the next three years, said executives.
Increasing its penetration Stateside is top of mind, and Vichy seems confident it can grow in tandem with its retail partners here.
“Retailers are investing in what’s working,” said Patsalides.
At CVS, the concept, which is named Healthy Skincare Center, continues to generate double-digit comparable-store growth, said Mary Lou Gardner, senior category manager, beauty at CVS.
Gardner, who oversees Healthy Skincare Center, noted that CVS began testing the concept in 2004 in five doors. It has since expanded the 11-foot (or 14-foot where space allows) department to nearly 600 doors, and added additional lines, such as Lierac Paris and the L’Oréal-owned La Roche-Posay. In its larger West Coast stores, CVS recently added Skin Doctors and this September plans to launch the Italian brand Kelemata. In smaller stores, CVS plans to test an 8-foot center later this year, with the end goal of rolling the Healthy Skincare Center concept out to a total of 1,500 to 2,000 of its 6,300 stores, said Gardner.
Referring to the effort, Gardner said, “Because CVS is a health care organization first and foremost, we saw this as an opportunity to build a bridge from the pharmacy to the front of the store.”
The drugstore chain’s research indicates that 42 percent of its customers who bought a product in the Healthy Skincare Center had previously never purchased skin care at CVS.
On a recent afternoon at CVS’ flagship in midtown Manhattan, a beauty adviser used a computerized tool to analyze a shopper’s skin. Afterward, she diplomatically told the shopper, “Your skin is a bit dehydrated,” while leading her to an assortment of Vichy’s Aqualia Thermal line. “This makes my skin look like I’m in my 20s,” she said, placing samples of Aqualia Thermal Multi-Protective Hydrating Lotion in the shopper’s hand.
“CVS is completely committed to it. We believe it’s a good fit,” said Gardner.
Vichy, for its part, is keeping one eye fixed on existing markets and another trained on future opportunities, naming Japan and Australia as possibilities.
Patsalides declared, “There is a big revolution happening in the drugstore channel.”