Under the Umbrellas an NACDS
The National Association of Chain Drug Stores Annual Meeting “unofficially” kicks off tonight with Revlon Inc.’s cocktail party. Though not as luxurious as years ago when Revlon constructed vanities made entirely of chocolate, the industry does expect Revlon to take it up a few notches based on some recent successes by the company.
Industry experts are buzzing about Revlon’s return to health in many color categories, as well as its purchase of Mirage Cosmetics and its hotter than hot Sinful nail colors. Revlon’s first-quarter income jumped to $10.4 million, or 20 cents a share, from $2.2 million, or 4 cents, a year earlier. The company also lodged $9.7 million in refinancing-related expenses. Sales rose 9.1 percent to $333.2 million from $305.5 million. Despite all of Revlon’s ups and downs in the past few years, retailers stood diligently by the brand — a move paying off as shoppers come back to beauty and Revlon.
Retailers didn’t want to see the brand fade away. That dedication helped the company steer through rough waters. Is it out of danger? Perhaps not yet, but the company has the best buzz that it’s had in the last 10 years.
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After Revlon bows with its party, the sleeves get rolled up. Instead of the traditional home at The Breakers, this is one of the years where NACDS takes the show on the road to Scottsdale and the lush Phoenician Hotel. Cabanas are replaced by bright umbrella tables where buyers and sellers talk about big picture issues.
Last year, the main chatter was about how companies had brought expenses in line and were looking for top line sales gains. In most cosmetics categories, those gains are coming. In particular, eye, skin and face makeup sales are expanding. Fragrance and lip sales still lag, but lip in particular is tied to makeup styles. Retailers are expected to hammer manufacturers about how to drive the lagging fragrance business. There also is expected to be exploratory discussions on improving the social networking used in marketing mass products and retailers.
This year it is anticipated there will be worries about price increases, especially on goods produced overseas. Raw material good costs are escalating and it is only so long before suppliers can halt passing on those charges. Some companies are also dealing with the issue by making packages or bottles smaller. The question is how far can you go before shoppers revolt on either price hikes or smaller sizes.
Another topic expected to surface is the ongoing controversy of what American consumers want as far as natural products. Do they want organic? Are they more concerned with eco-packaging? Is a seal of approval necessary? Also, retailers want to know advice on whether natural needs its own home or whether is best integrated into the traditional mix.
Health and wellness is a big issue and there will be many high-level meetings of how health dovetails with beauty. Should pharmacists be used more? Could in-store terminals help provide a place for consumers to sit down and interact with a dermatologist?
There will be room for parties, too, especially some of the favorites such as L’Oréal, Colgate and Procter & Gamble. But in the end, NACDS will be a fertile opportunity to create some big strategies for the future of beauty and drugstore retailing.
People, Place and Things
A few words with Candace Corlett, president of WSL Strategic Retail about Walgreens’ new store prototypes.
WWDBeautyNews: What do you think of what Walgreens is doing these days?
Candace Corlett: I think it is interesting and they are bubbling back and making stores fit the market. Times Square is a needs-based store and that’s what you have there. Astor Place is urban and their new look in Wheeling, Ill., serves a more suburban market and ties wellness and beauty together. There’s so much energy at Walgreens today. The stores are gorgeous and some of this is simply being done with paint, carpeting and lighting. Wheeling is one of the only stores you’ll ever hear people say, “What color paint is that?”
WWDBeautyNews: What are challenges for the future?
C.C.: Service remains a challenge. Walgreens has beauty advisers, but sometimes they aren’t there when customers are there. That’s the challenge, having service when the customer wants it. Maybe the definition of service will have to change. Maybe it becomes about merchandising and education at stores. There are many computer terminals in Wheeling for shoppers to use to get advice.
What’s In Store
Pantene Goes Plant-Based: Pantene has started producing its new shampoo and conditioner bottles made primarily from plant-based plastic. This material is made from sugarcane and will be featured on the Pantene Pro-V Nature Fusion collection. Sugarcane-derived plastic has significant environmental benefits: It consumes more than 70 percent less fossil fuels and releases over 170 percent less greenhouse gases per ton than traditional petroleum-based plastic.
FightGermsNow: The Personal Care Products Council and the American Cleaning Institute have teamed up to launch a new Web site, FightGermsNow.com, to provide consumers, researchers and regulators information on antibacterial soaps and ingredients.