NEW YORK — For many mass market manufacturers, the mediocre Christmas of 1995 was a sign the beauty industry needs a makeover.
“A business-as-usual mentality doesn’t work for anyone anymore,” said George Fellows, president and chief operating officer of Revlon Consumer Products Corp. “We all need to stretch beyond it.”
While the bleak Christmas was the most obvious sore spot, for many vendors it was just one symptom of a larger disease.
“Christmas to me was just a continuation of what was happening the rest of the year,” said Charles Busta, vice president and general manager of Procter & Gamble’s mass cosmetics business. “While we have been ahead in terms of retail sales, unit sales have continued to be slightly down.”
According to industry sources, beauty sales this Christmas only inched up 1 to 2 percent, compared with 1994’s relatively healthy gains of 5 to 8 percent.
Unit sales and store traffic, however, fared even worse than sales; they were down about 5 percent, sources said.
Retailers confirmed that their stores seemed emptier than usual and noted the traditional last-minute flood of shoppers desperately seeking to finish their Christmas lists never materialized.
“Impulse shopping is the result of two things: store traffic and presentation,” Busta noted. “Obviously, both of these elements were not up to par this year.”
Manufacturers cited several ways to put the joy back into the holiday season — while revitalizing year-round business.
Their strategies include product innovation, intuitive marketing, creative gift-set offers that stand out from the crowd, a more exciting and organized in-store environment and a keener understanding of changing consumer demands.
Overall, simply improving the shopping experience, at holidays and all year long, was a major concern.
“We need a commitment by retailers to make shopping a fun experience,” said Revlon’s Fellows. “The retail environment has to be pleasant and attractive; it has to be consumer-friendly. The customer should be able to find what she wants easily and to have her questions answered easily — by a salesperson, if possible, or by easily accessible product information and testers. “Having a full selection of product in stock, so the customers don’t have to settle, is important,” he continued. “Also, new items need to be featured and highlighted.”
Mark Laracy, president of Parfums de Coeur and Prince Matchabelli, agreed.
“We all need to spend more money at the point of sale,” he said. “We plan to spend more on [fixturing] next year to make sure stores are set up properly. “Retailers need a new strategy on how they approach the fragrance category in general,” he added. “They also need to adopt one security system, because we are willing to pay the 5 cents per piece it takes for source tagging. We have to get fragrances out from under glass to where the shopper can see and try them.”
Robert N. Hiatt, president and chief executive officer of Maybelline, noted that, like the fragrance section, makeup needs new strategies for display and marketing.
“We’re seeing some retailers have a reduction in their secondary display areas, and that hurts because customers aren’t exposed to what’s new,” he said. “So, we suggest retailers get out of their own way and give shoppers something to respond to. These displays do a good job of inviting people to come in and look at the whole department.”
Hiatt pointed to the clutter that plagues some cosmetics departments as a potential deterrent to sales.
“Mass retailers also need to do a better job of keeping the department in order,” he said. “There are many [stockkeeping units] to organize, and we are paying more attention to serving the stores.”
Revlon’s Fellows said one way to improve the shopping experience is for merchants to better understand the needs of their clientele.
“Retailers have to understand and adapt to the realities of life for women today — they have overwhelming responsibilities, at work and at home, and can ill afford time to shop,” he said. “They have to obtain products and services more quickly and efficiently than ever. By providing services other than just great cosmetics products — like bank teller machines, instant photo facilities, dry cleaning, etc. — retailers become more attractive as a destination shop.
In addition to improving in-store efficacy, manufacturers said gift offers should be more inviting and creative. “There is an awful lot of clutter and not many concise concepts,” P&G’s Busta said. “There are so many gift sets that have no real difference between them. This is definitely one of the reasons that fragrance didn’t do as well this Christmas.”
William McMenemy, executive vice president of Del Laboratories, said Del is focusing on gift sets with a difference, to set them apart from the crowd.
“One thing we are doing is moving away from traditional boxed merchandise in favor of packages that are reusable and represent value to the customer,” he said. “This is one thing that helps make gift sets more exciting.”
Reshuffling the merchandise mix and the number of holiday sets was cited as another possible way to boost sales.
“We have to work toward better sell-through so retailers don’t have to have January specials that train the customer to wait for sales,” Laracy said. Busta suggested stores and vendors work together to make Christmas selling more efficient by promoting basic items already in the stores, rather than just special gift sets.
“One idea to help Christmas sales could be to cut back on the number of gift sets and concentrate on the basic merchandise on open-stock walls,” he said. “You can promote strong sales of relevant shades in holiday color stories and develop a theme around them in holiday advertising and at the point of purchase.
“Revlon is especially good at this concept,” he added, referring to Revlon’s policy of incorporating not only brand new but existing shades into its seasonal color stories. “This method can be effective, since you can replenish the secondary displays with existing merchandise already on the walls, or return unsold product to the appropriate spot on the permanent display. Of course, we as vendors must be reasonable and make sure not to overload stores with product.”
The manufacturers agreed it is important not only to revitalize yule selling strategies, but to inject vitality back into the core, everyday business.
Thomas Bonoma, president and ceo of Renaissance, said one way to achieve this is to capitalize on the niches and gaps that exist in the mass market fragrance business.
“There’s been a gulf created in the mass market that I call the empty middle theory,” he said. “There are the prestige fragrances and the budget ones — and there’s probably a great market for solid, middle-priced mass fragrances.”
Parfums de Coeur’s Laracy pointed out that spreading out advertising throughout the year, and not just concentrating on Christmas, could take the pressure off the holiday selling season.
“Fragrances have become over-seasonalized,” he said. “We need to concentrate on building sales of basic stock — not just on promotions and deals. When I was at Quintessence, we brought the number of promotions down substantially without any loss in business, and we’re trying to do the same here. Product innovation was cited as another way to stimulate year-round sales. Manufacturers pointed to the success of technologically advanced products such as Revlon’s ColorStay, Cover Girl’s Ultimate Finish Foundation and Maybelline’s Lash By Lash Mascara as proof that science sells.
“What we are seeing is that the consumer wants to buy if there is a reason,” said Maybelline’s Hiatt. “New products with a real point of difference that are well merchandised are selling. We’ve seen that with our new products in 1995, such as Lash By Lash mascara and now our Great Lip lasting lip color. New, exciting products help the whole category.”
P&G’s Busta noted that as technology advances and more companies jump on the same product-benefit bandwagon, it is even more important to have clear advertising to explain product benefits. Heavy sampling is essential to tempt consumers who may be reluctant to try something seen as cutting-edge.
“The claims are now all so similar that everyone really has to go the extra mile to establish differences between products and to stimulate purchases,” he said.
Busta added P&G is stepping up its sampling efforts and is experimenting with direct mail, in-store testers and trial sizes.
Manufacturers also discussed the need to push the fashion-driven, impulse end of the business, in addition to the benefit-driven side.
“If a product is pushing wrinkle minimization, liposomes and sun protection, it is usually not a spontaneous purchase but a planned one,” said one vendor. “It is important to keep an eye on the glamour and shade end of the business, which is the part that stimulates more impulsive buying.”
One way to achieve a balance, Busta said, is to follow Revlon and L’Oreal’s example of promoting shade statements several times throughout the year. He said marketers could be more aggressive pushing color trends in middle America.
He noted that after a long hiatus, this year Cover Girl is returning to heavily advertised spring and fall shade promotions. “The return to color still has not greatly impacted the Midwest,” he said. “If we are all more consistent with color stories and put advertising behind them, there is no reason why color can’t make a comeback everywhere.”

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