GRAND OPENING: With a hot stock offering giving him the impetus, Patrick Ales is ready to tackle America.
The hair care guru’s Phyto-Lierac, a French manufacturer of plant-based skin and hair products, floated an initial public offering on the Paris Bourse on Oct. 15 and got an enthusiastic response. Slightly more than 14 percent of the company was offered at 170 francs ($33.15) per share, and only 7.5 percent of the first orders were filled, according to the company. As a result, the initial goal of raising 60 million francs ($11.7 million) was exceeded.
The company, formerly called Le Groupe Ales, has been independent since early last year, when Ales and his family repurchased a 44 percent stake from L’Oreal SA. In one form or another, Ales has been making plant-based hair care for 30 years.
While Phyto-Lierac has a presence in the U.S. — the Phytotherathrie line of hair care is sold in upscale chains such as Barneys and Nordstrom, and the Phytologie line is sold in salons — Ales said he now plans to create a brand solely for the U.S. market, with next April as the launch target.
For the first time, he said, the company has capital to invest in promotion and international expansion. “I want the money to be a motor,” he said, noting that he wants to increase exports to 60 percent of Phyto’s volume from 40 percent. Advertising in the U.S. will also be intensified in 1997.
In 1995, the company had worldwide sales of $75 million. Phyto-Lierac closed at 249 francs ($48.55) Thursday, up from 1.5 francs.
ROLL WITH IT: Fragrance Systems is marketing a new dispensing system that uses a rolling top to dole out a scent. As opposed to traditional pours and sprays, the rolltop format provides for a more controlled dispersion, according to Diane Breidenbach, the Smithtown, N.Y.-based firm’s chairman. “It’s very economical and easy to use,” she said. While a full-size version hasn’t been developed, the company doesn’t envision the technology being limited to samples: “We want it to be sold as a stand-alone item.”
Erox’s Realm fragrances were the first to use the technology, which employs a spring system to prevent leaks. Fragrance Systems is selling the roll-on dispenser to vendors as a purse spray-sized item, for which a replacement fragrance unit can be bought, as well as a smaller, sample size applicator.
ARDEN’S FASHION FLING: Elizabeth Arden strutted its color stuff last week. As a sponsor of New York’s 7th on Sixth fashion shows, Arden provided 80 makeup artists with cosmetics kits, while 1,200 members of the press received bags with lipsticks and mascara along with an invitation to try the company’s custom color foundation in the Color Lab that Arden temporarily set up. Victoria Spellman, vice president of marketing, noted that Arden will continue its sponsorship of 7th on Sixth for the foreseeable future. “We’ve undergone a major renovation of our color category, and it is important to Arden as a whole,” she said. “Color is fun, it’s fashion, and it really defines the personality and totality of the brand.”
EGG HUNT: For consumers who balk at spending $3,000, or even $750, for a fragrance gift item, Faberge has come out with a $325 stocking stuffer — a blue crystal perfume atomizer.
The atomizer is made by Saint Louis, the same French glassmaker that produced the $3,000 crystal egg launched in February to put new life into Faberge, one of the luxury world’s oldest brand names.
Spearheaded by consultant David Horner, the egg — which contains a 2-oz. perfume bottle — was the first step in a plan by parent Chesebrough-Pond’s to restore Faberge’s 19th-century gleam. The brand has since migrated to Chesebrough’s sister Unilever subsidiary, Elizabeth Arden.
Faberge produced a limited-edition of 500 eggs for sale at Neiman Marcus and Bergdorf Goodman, and according to executives, more than 300 have been sold. A different version with just the fragrance, of which 2,000 were produced, retails for $750 apiece.
For Christmas, Faberge decided to come out with a more accessible price point. The atomizers were shipped at the beginning of October, and according to sources, Neiman’s sold 31 pieces the first week. “Our business has been very good” with Faberge, said John Stabenau, vice president of Neiman’s. “It’s doing better than we expected.”
ANOTHER FOR AIKEN: Larry Aiken has added another name to his roster at Cosmetic Works, signing a long-term distribution deal with Wathne Cosmetics for its Professionals makeup line. While Wathne will continue to handle the creative aspects of the year-old brand, Aiken — who has inked deals with Fragonard, Clientele and Barielle this year — will oversee distribution.
STATE OF THE INDUSTRY: When it comes to cosmetics merchandising, the mass market approach may be cost-effective, but it’s not consumer-effective — at least according to Jack Salzman, partner and director of research marketing and corporate development at Goldman Sachs. “The mass market has become benign in its merchandising,” he said during a seminar this week sponsored by Glamour magazine. “Pushing a cart down an aisle is not an effective way to sell cosmetics. There is an enormous lack of creativity there.”
Salzman also noted that while the number of outlets selling beauty products has grown, the market for such products has not. “There hasn’t been any demonstrable change in the growth of the cosmetics industry for the last 15 years. It’s a relatively mature industry,” he said. “The new outlets have not stimulated more growth.”
Although the pie may not be getting bigger, new products are still stimulating sales. According to Barbara Zinn Moore, senior vice president of fragrances and cosmetics at Macy’s East and also a seminar panelist, Macy’s had “between 28 and 30 new fragrance launches this year and virtually every one is beating plan.”