BEAUTY’S SPECIALTY STORE ODYSSEY
Byline: Faye Brookman / Laura Klepacki
NEW YORK — Where’s a young specialty store shopper to turn for beauty?
The plethora of merchants — including apparel retailers and salons — vying for her pocketbook in almost any shopping center in America is mind-boggling.
For example, in the Willowbrook Mall in Wayne, N.J., a girl can easily comparison shop between MishMash, a new concept from Too Inc.; Skin Market, a California beauty retailer that recently landed on the East Coast; Limited Too; The Body Shop; Bath and Body Works; Sephora, and Victoria’s Secret Beauty just steps away.
If those are not enough, next door is Wayne Towne Center, another shopping mall, with Old Navy and off-price powerhouses such as Loehmann’s and Daffy’s. Loehmann’s features professional hair care and prestige fragrances at rock-bottom prices, while Daffy’s offers bath and body gifts.
A study, to be released in January by WSL Strategic Retail, shows that specialty stores continue to grow as a primary shopping channel for beauty care products. According to the annual survey, called “How America Shops,” 1 in 10 women now chooses specialty stores as her primary beauty source. Until recently, the specialty market only had eyes for junior shoppers.
It is no wonder there are so many specialty retailers coveting both tween and teenage shoppers — a segment of the market not affected by the economic downturn. “I was out checking shopping centers over the weekend,” said Linda Rothstein-Sosnick, director of product development for cosmetics and toiletries at Designs by Skaffles Inc. “The people with the most bags were young girls.”
It is estimated that the youth market has $90 billion of its own spending power and influences another $235 billion.
But in keeping with the fickleness of teen consumers, the retailers catering to them also appear to be in a constant state of flux.
Despite the free-spending clientele, the youth beauty retail landscape is not without its failures. In the same Willowbrook Mall, a kiosk called Fresh Mix, which enabled women to design their own bath, body and facial products, has closed.
And the Wayne Towne Center Old Navy has cut back its full personal care department to feature beauty as seasonal promotions. Four years ago, when the Old Navy collection was launched, it was offering free makeovers. From a freestanding island display that even offered scented body mists, the Wayne store offerings are now limited to a spinning rack near the register.
A spokesman for Old Navy, however, insists that, in general, the company has been expanding its selection of beauty items. “We’ve found our niche is fun, impulse items.” Beauty, he said, “brings an element of fun into the stores, with fun, feel-good-type items.” He noted that the offerings may vary from store to store.
There are retailers outside the mall arena that also dabbled in beauty without success.
In an attempt to bring more female shoppers into its convenience stores, 7-Eleven unveiled the proprietary Heart and Soul, a teen color line, last September. It is now “nonexistent,” said Ira Adler, president of Fira Cosmetics, which worked with 7-Eleven on the project. He explained that while the program was fully supported at the corporate level, franchise owners were slow to make it a priority.
Even Toys “R” Us took a shot at the business, offering its own True Girlz cosmetics brand and Zizi Zynn, a bath and body line. But a visit to a store in Totowa, N.J., revealed that what was once an 8-foot-long section with a full-length mirror, has been reduced to a couple of hooks on a peg wall.
Wet Seal and Delia’s also have pared beauty stockkeeping units to focus on trend clothing.
Skaffles’s Rothstein-Sosnick warned that companies must make sure the products are good quality. “If a girl tries something that’s not right for her skin, you’ll lose her as a customer.”
Despite any shakeout in the doors, experts on teen beauty marketing say it is only the lull before the storm. “There will be a higher level of activity in personal care at specialty stores,” promised Art DeGaetano, president and chief executive officer of Boom, a company that creates in-house beauty lines for specialty stores.
Adler of Fira said that his company’s business has grown 45 percent in the past year. “We are going after many different channels.” Current clients, he said, include junior-apparel retailers, drugstores, beauty and accessories stores and salons.
WSL’s president, Wendy Liebmann, said nonbeauty retailers that expanded into beauty three and four years ago with limited selections may be finding that the impulse sales they got were not worth the space or the effort.
“The issue you have now is either you are in it or you are not,” said Liebmann. “To be a serious shopper or regular customer, she has to believe you know what you are doing. When you have a marginal group of products, they [shoppers] may question whether this is a credible place to buy. “
“Many of these retailers don’t know how to handle personal care,” added one manufacturer. “They don’t have the right fixtures and they don’t always understand the customer for beauty at this age. She’s fickle and disloyal.”
Those familiar with the specialty players said that companies such as Limited Too and Claire’s are planning renewed attacks on the business. Limited Too recently moved personal care from the front of the store, where tables shaped like daisies once allowed shoppers to experiment with the chain’s GirlCare products. The tables are gone and beauty is on peg walls closer to the checkouts.
“For some shoppers, those tables became baby-sitters. It really wasn’t productive space,” said one manufacturer familiar with Limited Too. Robert Atkinson, director of investor relations at Too Inc. confirmed that the tables were not always the most productive use of valuable retail space. He said they’ve been removed in all but a few larger doors. “Personal care was never more than 5 percent to 6 percent of store space, and we feel customers can still find the products they want in the back,” said Atkinson.
A Claire’s spokeswoman said the company “is very committed” to its beauty business. The stores, she said, tend to carry “fun and funky items, lots of glitter and lots of color.” Recently, the company branded its line and named a vice president of cosmetics who is responsible for setting up the program.
Maurice Rasgon, vice president of sales for Blue Cross Beauty Products, a manufacturer of teen and tween items like the Heaven brand, said he is seeing a renewed focus by some of the specialty retailers. “The Limited Too and Charlotte Russe and others are getting more aggressive after a period of not being so aggressive.” However, he noted that he’s seeing less focus on total stations or dedicated sections for teen beauty.
The movement to capture young shoppers in mall-based specialty stores spawned a slew of teen beauty category killers. Some think the vertical approach to beauty is snagging shoppers who had been plunking down baby-sitting money at Claire’s.
Club Libby Lu is one of the companies vying for the tween and teen market. Started by Mary Drolet, a former Claire’s executive, Club Libby Lu now operates four stores in the Midwest, with a fifth to make its debut in March 2002. Club Libby Lu provides young girls with a hip environment where they can create their own potions, such as body lotion, lip gloss and fairy dust. The store also sells apparel, such as T-shirts and dress-up. “Business is great,” said Tina Spagnola, executive merchandising and executive director of marketing for Libby Lu. Spagnola is also a former executive at Claire’s.
Makeovers and birthday parties are also popular at the stores. The newest store will be larger than existing units — about 1,800 square feet. Although there are a few national labels sold, Spagnola said the company prefers to sell its private label.
For some of the mall-based retailers, the emphasis has been to augment beauty with unique items. My Emotions, a five-store chain based in Boca Raton, Fla., for example, now offers a full array of home decor items in addition to private label body and bath. “We really continue to fine-tune and change our look,” said Tom Souza, president and ceo of My Emotions. “We cut back the fragrance bar and went for 4,000 sku’s to 8,000 sku’s of home decor, like oil burners. We also have a great book selection and personal greeting cards. We’re different than other stores where we are.”
My Emotions also is offering shoppers birthday parties and makeovers, a service Souza said is “taking off.” My Emotions recently was granted a license to franchise the concept and Souza said he would love to have as many as 50 stores open within the year.
While many specialty stores court tweens and young teens, another key player has gone decidedly older. The Skin Market features a true environment for teens. The stores have couches to sit on and listen to music and read magazines, which they also sell. The use of color is crucial in the merchandising and some of the product collections are not aimed solely at teenagers. A collection called Floozy, for example, features a toothbrush, lip gloss and a condom.
The Skin Market has a new competitor in MishMash, which also is appealing to a shopper slightly older than Limited Too. (See related story page 7.).
While mall-based stores battle on, mass merchants are still tinkering with teen concepts. CVS has Grl Lab, which is anchored by Cover Girl and features many trendy accessory products. Wal-Mart offers a private label edgy brand called No Boundaries and several sources said Target is close to signing a well-known name for a private-label collection.
The new president of Jane Cosmetics, Sandy Cataldo, has been watching what’s going on at the malls. “Specialty shops do a better job of creating an environment that speaks to a broad range of teens,” she said. But she also believes that many of the offerings described as teen products miss the mark.
“Teen is still an opportunity,” said Cataldo. However, “a lot of people still don’t know what it takes to be successful at it. There is too much a of disparity between the adult brands and the teen brands. The teen brands have really been pushed into a preteen mentality. You can’t appeal to 12- and 19-year-olds with the same line. It has to be aspirational for the upper teens. You have to talk up to them. These talk down.”
Marc Pritchard, vice president and general manager of Procter & Gamble Cosmetics, the marketer of Cover Girl, said he’s not surprised to see a scaling back by some of the new players in the category. “A lot of manufacturers and retailers rushed to the teen and tween market and it got saturated. What we are seeing is just a natural shift back to the right balance.”