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CEW Panel Discusses How to Win in Prestige Beauty

Key executives from prestige beauty brands shared insight on their businesses and what it takes to succeed in the market.

Who’s winning in prestige beauty?

This was the topic at the CEW’s latest panel held Wednesday night at the Harmonie Club. Moderated by WWD executive beauty editor Jenny Fine; Alex Choueiri, president of international designer collections at L’Oréal USA; Terry Darland, president of parfums Christian Dior North America; Kirsten Kjaer Weis, chief executive officer of Kjaer Weis, and Tomoko Yamagishi-Dressler, senior vice president of marketing and sales at Clé de Peau Beauté sat down to discuss what it takes to succeed in the prestige beauty market.

The panelists started off by giving insight into the state of their businesses.

“I think for spring the market, especially in fine fragrances, has been more difficult,” Choueiri said, noting this year’s hurricanes in Texas and Florida had a negative impact on sales. “We had a rough patch of events that drove consumption quite down, but I think we’re in a positive way getting the comeback of this.”

Dior experienced growth across categories. “The makeup business has rebounded for us, driven by lips, eyes and face,” Darland said, also stating women’s fragrance has been consistent and men’s fragrance has been driven by Sauvage.

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For Clé de Peau, the beauty business experienced double-digit growth. “I think across the category in both skin care and makeup we’re seeing strong growth that’s sort of outpacing industry growth,” Yamagishi-Dressler said. “I think it’s due to the fact that the consumer is really appreciating exceptional quality in our products.”

Kjaer Weis, a natural prestige brand, has seen an increased interest from both retailers and consumers. “[The direction] is really wanting to take natural to an elevated state where it has a luxury aspect to it,” Weis said. “I would say it’s merging the two worlds that have always been separate where you have green on one side and then you have the luxury and high performance on the other.”

On how luxury has evolved, Choueiri said: “Unlike what people think that digital is making everything look like a commodity, it’s opening up a lot of opportunities for brands. One example is what we managed to do on YSL Beauty. It was tiny in the U.S. compared to where it is in Europe and we used key precision marketing to get the brand where it should be.”

Choueiri went on to explain how YSL used digital to launch its Black Opium fragrance in the U.S. The brand chose to launch the fragrance online only after targeting consumers digitally, which helped the fragrance sell out upon launch and ultimately generate $20 million in sales.

Darland then touched on how the luxury shopping experience has evolved. “The accessibility of the product today is far different than what it was. Before it was really brick-and-mortar only and now you have many different avenues that you can present the brand and have it be relevant today.”

As the panelists talked about shifts in distribution, the conversation quickly turned to how Amazon is changing the shopping experience and what its future is in the prestige market.

“At the end of the day it’s not about Amazon versus another retailer,” Choueiri said. “It’s more about how can we continue growing the market and how can we continue to recruit and tell stories.” He went on to explain the success YSL’s own e-commerce site has been experiencing since it started offering customized engraving for its lipsticks.

Yamagishi-Dressler echoed this point on storytelling: “For luxury brands, what really sets us apart is the quality, the craftsmanship and the artisanship that goes into making the products. We have so much story to tell and currently it’s not easy to tell that story on Amazon.”

The conversation then ended by focusing on the impact influencers have on luxury brands. “I think engaging with influencers today, if you find the right formula for it, it can be super important and really does impact the business,” Darland said. “It’s important to balance in terms of brand ambassadors. People like Bella Hadid who are paid ambassadors for us, high-reach influencers that are famous in their own right and then there’s the microinfluencer audience that gives you a whole other element but perhaps authentic engagement.”