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Natural Beauty Brands Show Renewed Clout

Robust sales in the natural-products channel has spurred confidence that these brands can perform more broadly.

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Anaheim, Calif. — Naturally based beauty brands are charging into conventional retailers. Robust sales in the natural-products channel has spurred confidence that these brands can perform more broadly.

Enthusiasm about the natural sector was reflected in the sizable crowds at Natural Products Expo West, which was held in the convention center here from March 7 to 10 and drew 63,000 attendees, up from 60,000 last year, to check out 2,428 exhibitors. According to information provider SPINS, sales of natural body care — a category that includes hair, skin, makeup and oral care products — rose 23.4 percent in natural-oriented distribution to nearly $1.1 billion in the year ended Feb. 16, while the category’s sales in the conventional channel increased almost 14 percent to slightly less than $325 million during the same period.

“I’ve been doing Expo for a while with a few different beauty companies. To me this was the most lively, busiest Expo I have been associated with. It was a very good show for us,” said Tim Schaeffer, senior vice president of marketing at the Denver, Colo.-based beauty brand Mineral Fusion. “I took it as a sign of the improved economic outlook. There was an intense positivity about business and investing in new products.”

After being dismayed by natural beauty products that disappointed with subpar performance, packaging and pricing, conventional beauty retailers are jumping on the natural bandwagon again, convinced that the full business potential of the natural beauty products isn’t close to being realized. Natural beauty brand marketers have done their part to appeal to retailers by rethinking their products to make them accessible to wider consumer bases.

“We believe that natural ingredients and organic products are of great interest to our customers and that they will continue to grow in popularity,” said Janet Taake, senior vice president of merchandising at Ulta. “When adding an organic line to the Ulta Beauty selection, we look to brands that are highly respected and that offer high performance.”

Melville, N.Y.-based Hain Celestial’s brand Alba Botanica is doing its part to draw into the fold younger consumers perhaps less familiar with the natural beauty category via its detoxifying skin-care line Good & Clean. Priced from $7 to $9, the Good & Clean products are Gentle Acne Wash; Toxin Release Scrub; Daily Detox Foaming Cleanser; Pore Purifying Mini Peel, and Dual Textured Exfoliating Towelettes. During roughly two weeks on Target and Wal-Mart shelves, Good & Clean’s bestseller is the Pore Purifying Mini Peel.

“The insight we hear from younger women again and again is that they have oily skin, though not necessarily acne, and they really want their skin to be perfectly clean and pure,” said Emma Froelich-Shea, senior vice president, marketing and R&D at Hain Celestial Personal Care. “That’s their entry into the adult facial care market.” Talking about Pore Purifying Mini Peel specifically, she continued, “What we know about the Alba customer is she is buying natural and conventional, and she is excited that a peel is in natural.”

 

Lines like Good & Clean offer an opportunity to electrify natural beauty sales at conventional retailers, where natural beauty sales remain relatively small. J.R. Rigley, president and chief marketing officer at J.R. Watkins, said the Minneapolis-based natural body-care company’s comp sales have jumped 18 percent year-to-date, but the natural retail channel is growing at a faster pace than the conventional retail channel. At least one mass retailer — Target — has plans to change that. He said Target, where the brand has been carried since 2006, is putting in end caps this month for J.R. Watkins’ new body butters priced at $11.99 and has been adding shadow boxes and banner signage to highlight its natural beauty brands.

EO Products has piqued Target’s interest as well. Last year the San Rafael, Calif.-based company launched Everyone, a line intended to appeal to younger customers with its cheaper, multipurpose products. A 32-oz. bottle of Everyone lotion is priced at $9.99 retail, compared with $9.99 for a 12-oz. bottle of a comparable EO item. Everyone currently accounts for around 10 percent of EO Products’ sales and will be tested in Target in a few months, according to EO Products cofounder Susan Griffin-Black.

“The reason we created Everyone was to go to the mass market and say, ‘We can create a great product for a lot more people that is very clean,’” said Griffin-Black, who noted that sales for EO Products overall have climbed 32 percent year-over-year.

Another brand that hopes affordability will attract consumers is Nourish, an organic body-care line by Beaver Falls, Pa.-based Sensible Organics Inc. with 24 stockkeeping units all with the USDA organic seal, ranging mostly from $7.99 to $9.99. Sensible Organics president and chief executive officer Rob Robillard explained, “Our mission is to make organic mainstream, so we priced everything under $10.”

Nourish may not have accomplished its mission yet, but it is well on its way to doing so. Robillard estimated the brand would double or triple its sales this year. Nourish entered some 300 Whole Foods stores in April of last year and 550 Ulta doors in October.

Own, a San Francisco-based skin-care brand that launched in March of last year, is another entrant in the natural beauty space pushing into Ulta. Own’s chief marketing officer, Stephen Mätt, said Own recently rolled out nationwide at the beauty specialty retailer. Its products, which contain conjugated linoleic acid, or CLA, to provide results without irritation, are priced from $11.99 to $24.99. They are placed in both the natural-product and skin-care sections at the stores.

Mätt remarked that conventional retailers typically have noticed a slow turnover rate of natural beauty products, but he believes inserting an effective antiaging component into those brands could boost the turnover. “We are embracing natural and antiaging. A lot of channel partners are looking to us to grow their business,” said Mätt.

Regardless of whether they are courting consumers at natural or conventional retailers, natural beauty brands are upping their game with improved formulations and on-trend products. Beauty balms, an important product for brands such as Garnier, Maybelline and L’Oréal Paris, have arrived in the natural beauty sphere. Simi Valley, Calif.-based Derma E introduced Evenly Radiant BB Crème with the peptide Matrixyl and SPF 25 for $39.50, and Mineral Fusion came out with three varieties for $24.99 each: Perfecting Beauty Balm with SPF 9 for a sheer, matte finish; Un-tinted Mineral Beauty Balm SPF 30 to minimize pores and even skin tone, and Illuminating Beauty Balm with SPF 9 to enhance glow.

“Up until this year, there haven’t been any natural beauty balms. All of those [conventional BBs] as far as the SPF goes use conventional sunscreens. Our customer wants mineral sunscreens and mineral pigments, and that is the main difference with ours,” said Mineral Fusion’s Schaeffer. “We have had a very positive response to it. We have very high expectations.”

Auckland, New Zealand-based brand Manuka Doctor is bringing bee venom, a hot ingredient for skin care, to the U.S. Its 13 products, priced from $16 to $80, have purified bee venom and Manuka honey. After heading to the U.K. in late 2011, Manuka Doctor vice president Greig T. Duncan said the brand sold out of six months worth of stock in three months. Manuka Doctor’s most expensive product, Rejuvenating Face Mask, has been its top seller.

“There is a growing movement for people to get away from chemically driven products. Our key actives are natural, but with science behind them,” said Duncan. “It is different from mixing avocados and strawberries and putting them on your face.”

Aubrey has revamped its skin-care portfolio to meet the level of sophistication customers demand from skin-care products. Patrycja Towns, media and advertising director at the Tampa, Fla.-based brand, said, “When we reformulated the skin care, we wanted to be able to say it does something. It does diminish wrinkles, and to do that, you have to do clinicals.” Aubrey, for instance, now touts rye seed extract, which is in its Lumessence Lift Face Cream and Lumessence Eye Crème, as being clinically shown to reduce the appearance of wrinkles and fine lines by 25 percent with twice-daily use.

MyChelle Dermaceuticals is targeting the sensitive-skin segment, a substantial market in beauty. Sarah Eggenberger, vice president of innovation and product development at the Louisville, Colo.-based brand, said one out of four people describe their skin as sensitive, and natural retailers have informed MyChelle the number of consumers who identify as having sensitive skin is even higher in their stores. For those customers, MyChelle created the Pure Harmony collection, priced from $12 to $43, with a cleanser, mist, cream, serum and mask.

“We wanted to treat the concern. Just like you treat a wrinkle, you can treat sensitive skin,” said Eggenberger.

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