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Beauty Inc issue 04/13/2012

Avid sportsman Louis Desazars is a man who likes to keep things moving. And while the Nars chief executive recently participated in his first triathlon (and was preparing for his second when he sat down for this interview), it’s sales at the renowned makeup artist brand that he has really powered forward since arriving in 2008. The brand posted blistering growth in 2011—with a global increase of close to 30 percent—and entered the top 10 in the U.S. prestige market. Here, Desazars reveals why he has no intention of slowing down, and the strategy he’s created to keep Nars on the fast track.

This story first appeared in the April 13, 2012 issue of WWD. Subscribe Today.

Nars broke into the top 10 in the prestige market in 2011 and was up 32 percent. What do you attribute that to?
We were up 32 percent in the U.S., but globally also we had close to 30 percent growth. The main thing I attribute it to is first and foremost to Francois Nars, his vision, his talent. He is more than ever involved in and passionate about the brand, and that makes a huge difference. He is a part of our everyday life, and the value he brings is amazing. The other reason is that I have an amazing team, very passionate for the brand and for the vision that we’ve developed. We have a very highly engaged environment and company. We measure employee’s engagement twice a year. It is through the roof since two or three years. It is something I pay very much attention to, and we’ve managed to sustain this level of engagement, which makes me very confident about our ability to keep this momentum going forward.

What is the vision for the brand?
To be the most aspirational makeup artist brand in the industry. We have a very specific sales target which we have set ourselves for 2020, as well as operating profit levels. But we want to be the most aspirational brand. From the customer point of view, we want customers to be emotionally engaged by our creativity, by our customer experience that we give at the counter, by the artistry. We want also to be the most desirable brand for the retailers because they see us as very selective, very strategic, very professional, with excellence in execution. And we want to be aspirational in the industry in order to acquire and retain the best talent out there.

For a makeup artist brand, why is it so important to have the founder involved?
Whether it’s a makeup artist brand or any brand, founders are the heart and soul of the brand. When you have your designer or your creative that is alive, that is a fantastic asset, because they have this vision and a unique creative talent that is priceless.

What are you doing to drive growth in 2012 and will you sustain the levels you achieved in 2011?
In 2011, there was the people aspect and the Francois aspect, but on top of that, we’ve had some strong product initiatives and a very solid marketing plan, as well as some major branding initiatives that
have really reinforced the brand equity, such as the opening of our first freestanding store and the launch of the book, Make Up Your Mind: Express Yourself. We launched a new Web site in August, and we had this amazing initiative with Sephora in the U.S., where we had “From Runway to Real Way” and we had the window presence in all the Sephoras throughout the country and it has helped a lot to raise brand awareness and reinforce the brand equity.

In 2012, we are going to keep this momentum. We have a lot of room to grow, not only in the U.S. but internationally. We are only in 17 countries globally, and in the U.S. our market share is only 2.5 percent. We are going to keep doing what we’ve been doing, in more elevated ways. We are going to reinforce our presence at fashion week, in the U.S. and globally. For the first time, we’ve participated in fashion week in London and Paris, and that will help raise brand awareness and our business in Europe. We are going to keep elevating our e-commerce experience with our new Web site. Our site is going to go mobile—m- commerce is something new for us.

Francois has lots of major initiatives that he will be involved in, too, so I am confident that this will help drive the business. And also we have some major initiatives in some key categories. One is complexion, with the launch of the Pure Radiant Tinted Moisturizer. Second will be the relaunch of our skin care. It was launched now 12 years ago, so it needed refreshing and we are coming up with a very unique concept and formulas. Then we will have a strong collaboration with an artist [Andy Warhol] for the holiday season, when we know that our penetration and our market share usually drop a little. One of our goals is to see how can we be stronger during that period, during the fourth quarter.

How do you hope to end 2012 in terms of market share?
The goal is to end up with 2.9 percent market share in the U.S.

Globally, where do you see the most opportunity and why?

Our focus is on existing markets. In our top markets, we believe we still have huge opportunity because we don’t have scale. The U.K. is definitely a key focus and in spite of the difficult market conditions, we can grow and grow fast, and so far the numbers have been excellent. Japan is also key, and Hong Kong and Korea are definitely a focus. We are exploring expanding in South America, especially in Mexico and Brazil.

How do you see the industry overall evolving over the next two to five years and what opportunities excite you the most?
I’m an optimist, and I think the opportunity is big. I was having lunch recently with someone who had a good line. He said, ‘In the late Nineties, you had to be in the dot-com business. During the 2000s, you had to be in banking and in the 2010s you have to be in luxury.’ It’s a good point. The BRIC countries are booming. You see the development of a middle class that aspires to buy luxury, and the first affordable luxury is beauty and cosmetics. We are poised for some strong years ahead of us. The crisis we’ve gone through in the U.S. and Europe was tough, but the right decisions have been made. I think we will resume down the road, in two to three years of higher GDP growth in Europe and the U.S. I feel confident about that.

What do you think the industry needs to pay attention to most in the year ahead?
The most important thing is innovation and creativity. We need to come up with strong stories, strong innovation in order to keep inspiring customers. Brands need to stay very true to their heritage and what they stand for. We need to keep taking risks, because you can not grow if you don’t take risks. Stay relevant and stay ahead of the game. With the market being more and more concentrated in the hands of big groups, you need to have fewer, bigger, better launches and be much more strategic than before and put your resources on your key initiatives. Also, the digital revolution is only beginning and it is crucial that management of the big companies raise their digital IQ in order to be relevant to this customer and to this new way of communicating.

What is your secret for dealing with creatives?
[Laughs] Every creative is different. The first important thing is staying humble. Nars would never be what it is if there wasn’t Francois Nars. You need to build a lot of trust and be confident in the vision of the founder. They see things that you don’t, and you have to be willing to take risks and trust their vision and their taste. Building a transparent relationship is also important. There is nothing that leaves this brand that doesn’t go through the approval of Francois.

Last year, you opened the first freestanding Nars boutique. What was the biggest revelation and will you open more?
We will open more. I hope very soon we will be announcing our second boutique in New York. We want to open 10 stores in the coming three years, whether it’s in the U.S. or outside. The boutique has changed the perspective retailers and consumers have of us. It has increased the level of trust and confidence in the future of the brand. A lot of consumers who are used to seeing the brand only through Sephora or some other retailers, see now what we stand for, discover that we have such a large palette of color, that we have skin care, discover our DNA. The more they understand the brand story, the more engaged and passionate they are about it.

What other emerging retail channels excite you?
When it comes to the retail world, there are two things that I’m looking at. I’m very passionate about the Ron Johnson and JC Penney story. What he is trying to do is very brave—he is willing to take risks and shake up the department store model and it’s very refreshing to see his approach. The second thing I’m looking at is what’s going on around the digital world. I’m looking very carefully at Amazon, which has such ambition and wants to triple its business and be the leader in every product category they represent. We also have to be very smart in the way we approach social commerce. It is going to become a bigger part of the business and growth.

How would you describe your leadership style?

One of the first things I worked on was clearly defining the culture at Nars, and making sure I was hiring people who fit with the culture. It is crucial to have a strong culture. Secondly, I empower people. I set quite ambitious goals to force people to think differently, to stretch themselves, and then I empower people to come up with ideas to make it happen. I have developed a collaborative environment. We work as a team, and when you ask any employee, that is something they appreciate. I make sure that everybody is in the loop of what’s going on, so people understand how their work is impacting the overall business. I conduct monthly information meetings where the whole office is present. We celebrate successes, we share strategies and results. This promotes teamwork and excellence and a high level of engagement within the whole organization.

Do you believe in mentors?
It’s important to have a network of relationships that you can trust and go to. But what’s more important is to be curious, to meet people, to ask questions, to have a high level of listening skills. I’ve been raised with the value of humility. To me, this is understanding that you’re not perfect and that you don’t own the truth. This is a key value to help you to grow. I believe very much in investing in people’s development. I had the chance to go to Harvard and do an executive program. What it has brought to me was just amazing. It has to be a priority corporate-wide to invest in people’s growth. You get a great return on the investment.

What’s the most difficult business decision you’ve had to make and would you make it the same way?
Two types of decisions are very difficult. People decisions—when you’re in a small company, every person counts and you’re always afraid of the impact it may have. At the end of the day, making those tough decisions in a fair and respectful way is the right thing for the person and the right thing for the company. But it’s not easy. The second difficult decisions are those that are right for the long term for the brand equity, but which have major short-term implications. This could be postponing a launch because you believe a product is not strong enough or making a decision on closing distribution. You need to trust your gut and the strength of your brand and your team to be able to overcome those decisions in order to meet the budget.

You’re a Frenchman working for a Japanese company headquartered in New York. What is the key to creating a cross-cultural success?
I see it as a strength, but it’s definitely not easy. You have to approach it with a very open spirit, an open mind, a respectful and humble way of approaching the different cultures. And you shouldn’t put people in a box. Each person as an individual is unique. Patience is also important when you approach this multicultural environment, to make sure things are well understood.

How do you divide your time and how much time do you spend traveling?
[Laughs.] I hate sitting at my desk. I get inspired when I’m in the field, when I travel, so I spend about one third of my time traveling, whether it’s in the U.S., Europe or Asia. If I’m in the office, I try to always stay outside of my office and understand what’s going on, having very informal discussions with people on the floor. You learn a lot. It’s important to stay visible and close to what’s going on.

What do you do to relax?

I have no problem relaxing! But to me, relaxing is not about lying on a beach or next to a swimming pool. I need to be active. Being quiet drives me crazy. I love sports, so I golf, play tennis. I did my first triathlon last September and will do another in April. I love the outdoors. I love gardening, especially at my country house in France. I love hiking and fishing. I love opera and music. My latest thing since I’ve moved to New York is going to jazz bars and blues clubs. I’m having so much fun. There are so many unique places and so much choice. It’s fantastic.

In Brief

A native of Paris, Louis Desazars studied business at the prestigious university, Sciences Po. He began his career at LVMH Moët Hennessy Louis Vuitton, where he held numerous positions at Parfums Christian Dior. In 1996, he joined Shisiedo International Corporation as vice president of the European market for its fragrance company, Beauté Prestige International. Eight years later, he was named head of BPI’s U.S. affiliate. In 2008, Desazars was appointed chief executive officer of Nars Cosmetics. Founded by makeup artist Francois Nars in 1994 and acquired by Shiseido in 2000, Nars is among the fastest-growing brands in Shiseido’s portfolio.


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