DFS TAPS TEAM TO TAKE SEPHORA GLOBAL
Byline: Pete Born
NEW YORK — Sephora, one of France’s most innovative beauty retailers, is bringing its superstore concept to the rest of the world.
Sephora’s sister LVMH Moet Hennessy Louis Vuitton retail subsidiary, the DFS Group, has taken the first step in its mission to bring the Sephora concept to the Americas and Asia/Pacific by assembling a key executive team.
DFS has recruited Steve Bock, who has resigned as executive vice president of Saks Fifth Avenue, to head merchandising for Sephora in the Western Hemisphere.
Bock will return to DFS headquarters — where he worked before Saks — in San Francisco as an executive vice president.
He will join Howard Meitiner, who recently was named president and chief executive officer of Sephora at DFS for the Americas and Asia/Pacific. He previously headed the Oceania region at DFS.
Myron E. Ullman 3rd, DFS Group chairman and ceo, has been assembling the Sephora team and is expected to add to the squad two vice presidents — for operations and for finance.
But Meitiner and Bock are expected to get down to work in San Francisco next Monday to begin mapping the expansion.
The combination of Sephora and DFS promises to be one of the most dynamic matches in international beauty retailing. The giant DFS has long dominated the travel retail business, particularly in Asia, and had sales of $2.74 billion last year. Sephora is France’s premier perfumery chain; its 54 stores rang up $225 million in sales last year, giving it an 8 percent share of the country’s fragrance and beauty market.
But it has not led only in terms of sales. Last December, Sephora opened a 14,000-square-foot flagship store on the Champs-Elysees that quickly became the most talked-about beauty showcase in the world. It not only features one of the widest assortments of fragrance and beauty products, but offers an entire playland of merchandising touches, encouraging customers to test virtually every product in sight.
Management at Sephora’s French headquarters will continue to direct the development of the chain in Europe, and there are plans to open 30 more outlets in France in the next four years, as well as about 20 stores in other European markets. But DFS will be responsible for the Western Hemisphere.
Reached for comment Monday, Ullman said he hopes to have a “reasonable number” of Sephora stores launched the first year, perhaps beginning in the second quarter, opening “simultaneously” in the U.S. and Asia.
The timing and location of openings hinges mostly on the availability of real estate; the average Sephora store in France measures 4,500 square feet. The largest unit so far is the 14,000-square-foot Champs-Elysees superstore.
Ullman said he sees Sephora as a powerful ally for DFS. “It clearly is one of the more exciting specialty concepts in retailing today,” Ullman said, adding, “I am quite pleased. It helps diversify our business base.”
DFS is a global retailer, but there’s a limit to the growth potential of some markets, Ullman noted. And while 12 of DFS’s more than 150 stores are downtown units far from any airport, most volume is generated from travel. The Sephora acquisition will allow DFS to cross into mainstream retailing. Unlike the discount-driven travel retail business, Sephora offers DFS an entry into a regular-priced merchandising world that is defined by fashion. This opens a new frontier of market development.
And not only for DFS. It also could be useful to parent LVMH in distributing its beauty brands — Christian Dior, Guerlain, Parfums Givenchy and Parfums Kenzo. Cosmetics industry sources have speculated in the past that LVMH chairman Bernard Arnault would create his own U.S. retail channel, such as a chain of Sephora stores, for relief from the financial pressures of doing business with American department stores.
Sephora now has 57 stores in France — and a lone foreign unit in Luxembourg — and sources indicated DFS feels there is no reason there can’t be as many units in the U.S. and Asia/Pacific.
Regarding Bock’s addition, Ullman said, “We are very pleased to be able to attract an outstanding executive such as Steve. He brings the kind of leadership we need for a new venture with new, exciting concepts.”
DFS reportedly had begun wooing Bock months ago, even before LVMH acquired Sephora in July.
Saks has not named a successor to Bock yet. Bock is the second top executive to leave the store in as many months. Rose Marie Bravo resigned as president in September to join Burberrys Worldwide as ceo (see related story, page 2).
Bock joined Saks in early 1993 as vice president and divisional merchandise manager. After three years, he was named senior vice president of fragrances, cosmetics and women’s designer fashion. In the wake of Bravo’s resignation, he moved up to executive vice president before subsequently accepting DFS’s offer.
Prior to Saks, Bock was at I. Magnin, San Francisco, for four years before joining DFS as vice president of fragrance in late 1991. He was with DFS through 1992 before briefly moving back to Magnin’s — just prior to the store’s shutdown. He then moved east to Saks.
Bock began his career at Jordan Marsh in Miami and was a divisional merchandise manager of cosmetics at Goldwater’s in Phoenix.