BEAUTY BY THE BUNCH: THE LATEST STRATEGY IN MASS COSMETICS
Byline: Cara Kagan
NEW YORK — If one is good, more is better.
That is the philosophy that has been driving the mass cosmetics market for the last year or so.
In past years, the launch of single star products fueled most cosmetics brands, but lately companies have been thinking in terms of entire franchises with mainstay items begetting a flock of fellow travelers.
Revlon has been particularly ardent in this pursuit. This fall the company extended its ColorStay long-wearing lipstick, which was launched in 1994, into a collection of five products promising more staying power. The company has also recently expanded its Age Defying array of concealers, pressed powders and foundations for women over 35, with an additional three items.
Maybelline has been bitten by the same bug. Throughout this quarter, it will roll out line extensions of its 25-year-old Great Lash mascara, which will become an eight-item collection.
Meanwhile, throughout this year Procter & Gamble will tentatively explore the concept by extending lipstick names to foundations in both its Max Factor and Cover Girl brands.
“It used to be that every product had to have a different name,” said Charles Busta, vice president and general manager of Procter & Gamble’s mass cosmetics and fragrance division. “Now everyone is seeing the benefits of using a strong, transparent name as an umbrella, and I think this type of thing will be the wave of the future and could eventually replace isolated single-product launches.”
This current trend comes at a time when sales in the mass market are on an upswing. After several years of flat to declining growth, mass cosmetics sales were up 5.1 percent in 1994. The growth curve continued last year; sales increased an additional 5.3 percent for a total retail volume of $2.27 billion, according to industry sources.
The industry movement toward product franchising is expected to contribute to 1996 gains of as high as 7 percent, sources estimated. That would give the mass cosmetics market a retail volume of $2.35 billion.
Extending single items into subsidiary lines is nothing new. In fact, the practice dates at least as far back as the introduction of Revlon’s 25-year-old Moon Drops brand, which now embraces a collection of lipsticks and skin care items.
Maybelline also was an early practitioner of the marketing concept. In 1983, the company extended its Shine Free oil-controlling powder and foundation into a collection of cosmetics aimed at teenage girls with oily skin. The company’s other sub-brands include the Shades of You range of color cosmetics aimed at darker-skinned women, which was introduced in 1991. Meanwhile, its Revitalizing franchise, which was launched in 1993 for women over 35, is based on Maybelline’s lip and nail color products with the same name.
Robert Hiatt, president and chief executive officer of Maybelline Inc., pointed out that the strategy of mega-branding can also be viewed as a sign of a tight economy.
“The reality is that it is more economically effective for a company to have a collection of products with common attributes,” he said. “It is a way to stretch advertising dollars and to obtain a more impressive in-store presence. “If you have a grouping of similar products in one section of a display, it creates more impact at the point-of-sale, rather than having the same number of items all spread out,” he added.
P&G’s Busta agreed.
“It’s really a way to get more bang for the buck, as media costs continue to rise,” he said. “Now that most companies have achieved full distribution and they’re not making the sales gains from expansion like they have in the past, everyone is becoming craftier and looking for new and smarter ways to grow. “
“Sub-branding was a way for brands to expand throughout the Seventies, when most of the cosmetics companies had niche specialties,” said industry consultant Allan Mottus. “Cover Girl was known for foundation; Maybelline was an eye company, and Revlon was a lip and nail brand. Expanding into hot sub-areas was a way for a company to round out its offerings and to extend its reach.”
But the latest wave of line extensions serve another purpose. “There is so much maturity in every brand now that all of the major companies are full-service cosmetics houses,” Mottus said. “It becomes almost a necessity for every company to look for a way to stand out. So marketers are becoming smarter about leveraging successes.”
Since many of the new sub-brands claim to offer more technological innovation and promise increased benefits, the prices are also higher.
Revlon’s ColorStay lip color, for example, has a suggested retail price of $8.50, once considered unheard of for mass market lipsticks, which typically retail for under $7.
Maybelline’s Great Lash extensions are priced 30 to 40 percent above comparable Maybelline products. All of the items, except for the nail polish, which will have a suggested retail price of $3.50, will be priced at $6.50 each.
But while mega-branding has been deemed to be more efficient economically, establishing a franchise also has its price.
Maybelline, for example, is supporting its Great extensions, which are rolling out now, with $30 million worth of TV and print advertising.
While Revlon executives declined to discuss advertising budgets, the company is reportedly backing its ColorStay collection with a print and TV advertising budget of around $25 million, and Age Defying’s ad spending is said to be about $18 million.
Establishing a sub-brand can not only be expensive. It can also be complicated.
“You have to be smart,” Busta cautioned. “Just because you slap the same name on a group of products doesn’t mean it will become a mega-property. The name has to convey a strong benefit that is relevant to all of the products in the collection. And that first product better truly live up to its name and claims. Otherwise, you don’t have a leg to stand on.”
Industry experts cite one of Maybelline’s permutations of Shine Free as an example of too much of a good thing.
Shine Free originally encompassed blushers, powders, concealers and foundations specially created for young women with oily skin. But throughout the late Eighties, the company started marketing lip, nail and eye items, which did not relate to the original oil-free positioning.
As a result, the new additions were pulled from their shelves in 1990.
Revlon’s success with its Age Defying and Color Stay franchises is partially credited with kicking off this latest round of line extensions.
Industry sources view those lines as the main reason behind the company’s jump in market share and leap into the number-two spot in the mass market.
In 1994 the company held an estimated 17.3 percent market share, behind Maybelline’s 18 percent share. Last year, Revlon commanded 19.9 percent, or an estimated $437 million in sales, while Maybelline generated 18.2 percent of the market, or $400 million in sales.
With the exception of the Age Defying grouping, which is aimed at women over 35, all of Revlon’s recent franchising efforts have focused on the long-wearing segment of the market.
Along with Revlon’s ColorStay, the company is also set to launch a long-lasting eye cosmetics collection in its Almay division, called Amazing Eyes. In addition, Ultima II, the company’s department store line, has built two franchises around the concept: WonderWear and Sexxxy.
Kathy Dwyer, president of cosmetics for Revlon North America, said Revlon has been focusing on the long-wearing segment of the market because company research shows that women have been searching for lipsticks that will stay put.
“When we did further research, we found the need existed across several other categories,” she added.
Age Defying, which was first introduced in 1994 as a collection of foundations, concealers and pressed powders, now includes eye shadows, cheek colors and Creme Makeup.
“This franchise is really centered around the part of the face that women told us they associated with aging, such as around the eyes,” Dwyer said.
Revlon will further augment its ColorStay transfer-resistant franchise in March with the launch of Lashcolor mascara. The product was designed to build lashes without clumping or smudging under the eyes.
Each of the three colors will have a suggested retail price of $7.25.
Almay, which finished last year with a 5.7 percent share of the market, or about $125 million in retail versus 5.4 percent the year before, is following Revlon’s example.
But rather than introducing a single star product to extend into a franchise, Almay is coming out with a full long-wearing lineup at the same time. In February, the company will launch Amazing Eyes, a five-item assortment of eye products with staying power that were created to be non-irritating.
The collection consists of regular and water-proof versions of Amazing Lash Mascara, Amazing I-Liner liquid eyeliner and Amazing Lasting EyeColor eye shadow. Each of the products will have a suggested retail price of $5.95.
Lasting color is also the basis for Maybelline’s new Great Lash brand expansion.
With the exception of one new addition, Great Lash Pro-Vitamin thickening mascara, with pro-vitamin B-5, all of the items were designed to stick it out over the long haul.
The other new Great products are Great Line eyeliners, Great Lip Longlasting lipstick and Great Finish quick drying nail enamel.
“We felt that if we launched four products with the same level of performance as Great Lash and at the same time were grouped around a similar concept — such as long-wearing — we would be able to make a bigger event out of it than if we introduced four disassociated products,” said Maybelline’s Hiatt.
Procter & Gamble is only dipping a toe into sub-branding this year. But it is also using the long-wearing segment of the market as a point of entry for both its Cover Girl and Max Factor brands.
Both lines finished 1995 with slightly lower shares than the previous year.
Cover Girl ended last year with a 23 percent share of the market, or $506 million in sales, down slightly from a 23.4 percent share in 1994.
Meanwhile, Max Factor shrank from a 7.1 percent share to 6.7 percent, or $147 million.
In April, Max Factor will introduce Lasting Performance foundation as an extension of its Lasting Color lipstick, which was reformulated last year to provide longer wear than the company’s original version.
Cover Girl is also pairing lipstick with foundation. Next month, the company will start shipping its Continuous Wear transfer-proof foundation, which will claim to provide all-day wear without a tacky or heavy feel.
The new entry plays on the name of the company’s top-selling lipstick, called Continuous Color, which was reformulated and relaunched last year.
“The idea is to continually reinforce both [Continuous] products and their end benefits through each other,” Busta said. “We haven’t pursued [franchising] the way we might have. But as opportunities present themselves and we can use the strategy effectively, we hope to do more of it. For example, if Continuous Wear is successful and we see another appropriate place to extend it, we could build on the Continuous name.”