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MAY 4, 2015

BEAUTY

BCRF Honors Leonard Lauder ●

Event raises close to $7 million for breast cancer research.

Tony Bennett and Sir Elton John

BY JULIE NAUGHTON AND PETE BORN

For a man who has had a lifetime of honors, Thursday evening was clearly Leonard Lauder’s moment. He found himself on stage at the Waldorf-Astoria being serenaded by rock royalty in the form of Sir Elton John. “If he were in England, he would have the sword. He would be Sir Leonard by now,” Elton John began. Then he concluded the song with a salute: “Leonard Lauder, the greatest man I know.” The event was the annual Breast Cancer Research Foundation gala, which Lauder’s late wife Evelyn founded, and the song was Elton John’s way of presenting the chairman emeritus of the Estée Lauder Cos. Inc., with Roz and Leslie Goldstein Sung Hero award. The award is normally called the unsung hero award, but as Roz Goldstein pointed out, Leonard Lauder cannot be called unsung. The Thursday evening dinner raised close to $7 million for breast cancer research, bringing the organization’s lifetime total to more than $535 million. “Am I the sung hero?” Lauder replied

Leonard Lauder

“If he were in England, he would have the sword. He would be Sir Leonard by now.” — Sir Elton John to Elton John’s impromptu tribute. “No, you all are,” he said the packed ballroom, then went on to thank everyone for their support through the years. The other high point of evening for the crowd was a 35-minute concert by

Tony Bennett, who belted out some of his biggest hits of his 50-year career. Lauder, chairman emeritus of the Estée Lauder Cos. Inc., had new wife Judith Glickman Lauder on his arm as he navigated the pink carpet. “We’re like

BEAUTY

Mass Beauty Retailers Search For Opportunities at NACDS ●

Chain retailers lament about mass beauty’s unknown future.

Photographs by Steve Eichner

BY FAYE BROOKMAN

PALM BEACH, FLA. — Unsettled. That was the mood of the beauty market at last week’s National Association of Chain Drug Stores Annual Meetings. Under the sweltering Florida sun, buyers and sellers lamented that it is hard to move ahead in beauty when many of the major brands hit turbulence. In particular, Coty is regrouping under a new chief executive officer, Elio Leoni Sceti, while Procter & Gamble seeks to sell off beauty brands. Executives said P&G is such a supporter of mass beauty that its unknown future was among the major topics discussed during the four days of meetings at The Breakers hotel. “The general feeling is the [beauty] industry can’t get to growing business until the big companies settle down,” said Wendy Liebmann, ceo of WSL Strategic Retail. Retailers agreed that until the supplier side gets its house in order, there’s a dearth of product innovation curtailing sales. Suppliers countered that chains are keeping inventories so tight that it is hard to experiment with fresh concepts. Still, there was enthusiasm that dollar volume in the mass portion of the business, according to the NPD Nielsen Cross Channel Monitor for the 52-week period ended in March, was up 2.8 percent to $22.2 billion. Those gains, however, lag behind a 5.5 percent hike in prestige. With changes in health care putting greater profit margin pressures on pharmaceuticals, the more than 2,000 executives attending agreed the front end of the store — especially beauty — needs to be fortified. Compounding the challenge is encroaching competition from specialty and apparel retailers vying for their share of the estimated $33.5 billon beauty and personal-care market. “Seven out of 10 [people] purchased personal care,” said John Standley NACDS chairman and chairman and ceo of Rite Aid Corp., citing results from a survey

conducted by Public Opinion Strategies commissioned by NACDS that underscores the importance of the front end. Although that percentage is healthy, retailers want to address those who aren’t fulfilling beauty needs at drug or discount stores. “We know some shoppers still go elsewhere for beauty,” noted Mark Griffin, president and ceo of Lewis Drugs. Strategies emerging include more proprietary beauty brands, a focus on merchandising for the multicultural and Millennial audiences, a fresh approach to fragrance, better synergy between wellness and beauty and avenues to lure

in-store materials include the images of Kat Graham of “The Vampire Diaries” and pop and R&B singer Jasmine V who is of Filipino and Mexican descent, as well as Fergie. The company also has big plans for its newest acquisition, Lip Smacker, including more off-shelf promotions such as checkout stands and holiday displays. “Star Wars” and major sports league licensing is being used to boost volume of men’s lip balms. Physicians Formula Inc., also owned by Markwins International, is posting double-digit growth linked to a slew of innovative new items. Its new Eye Booster Instant Lash Extension Kit, priced at $14.95, is now the number-

“The general feeling is the [beauty] industry can’t [grow] business until the big companies settle down.” —Wendy Liebmann, WSL Strategic Retail back consumers who have strayed to other beauty doors. “A lot of retailers didn’t invest in keeping shoppers. They didn’t dazzle,” explained Liebmann. Frustration with stagnant cosmetics sales prompts retailers, such as Wal-Mart and Walgreens, to turn over footage to exclusives. “There’s just too much sameness out there,” said Bob Kwait, chairman and ceo of Kwait Consulting. That drove many to strategic meetings with Maesa, the company behind Flower by Drew Barrymore at Wal-Mart and Circa at Walgreens. These lines allow chains to fill a void in the market while generating traffic. “You also build customer loyalty as your stores become a destination for the brands,” explained Gregory Mager, Maesa’s ceo and founder. Beyond creating proprietary color brands, the company hopes to reinvigorate fragrance with a single-note program retailers can use to offer exclusive collections. Markwins Beauty has two new faces joining Fergie as ambassadors for Wet ’n’ Wild that company president Bill George believes will further burnish the brand’s image with Millennials and diverse consumers. New

one mascara in the drug channel. “We are elevating the category,” said Ingrid Jackel, ceo. “This results in higher shopper basket [rings].” The company also debuted a new illuminated fixture that Jackel feels further burnishes the drugstore shopping environment. Physicians is now the number-six brand in drugstore beauty. “We’re not a little niche brand from California anymore,” she added. Another company retailers said isn’t tiny anymore is E.l.f. Cosmetics which president and ceo Tarang Amin said is growing at a 30-plus percentage rate thanks to the quality combined with value message. The brand has wide appeal to all ages and ethnicities, he added. Retailers said they believe major changes are coming in the way they merchandise products targeted at diverse consumers. The goal is an inclusive set, rather than the separate departments currently presented today. “Where we are at with multicultural today is what it is,” stated Liebmann. “Is it skin tone? Is it hair conditions? We are that point where we are really starting to understand and the industry is about to move.” Other meeting news: Revlon Loves Halle: Revlon’s beauty ambassador Halle Berry made

two kids,” he said. “We were never really single. When we got married [to their respective original spouses], we did not know what marriage was. You got married, you had babies, you went to nursery school and if they got sick, they threw up in bed. And here we are, I dare say, grownups and enjoying ourselves.” While chatting along the rope line, Lauder spotted one of the evening’s co-chairs, Lizzie Tisch, and pointed out that he was once an upstairs neighbor of hers. A noisy neighbor, he joked, saying he was a heavy walker with loud footsteps. “In the building, we call him trouble,” cracked Tisch. Lauder was presented with his Sung Hero award by his granddaughters, Eliana, Danielle and Rachel Lauder. “Pa, I’m honored to spend this evening with you,” Danielle Lauder told her grandfather in front of a room of more than 1,000 people. Attendees’ summer plans also came up. Donna Karan revealed that she’s setting up a vocational school in Haiti in June, while William Lauder’s plan to have his knee replaced sounded considerably less fun. Elizabeth Hurley is filming the second season of her television show, “The Royals,” on which she plays a fictional Queen Helena. “It’s fabulous to play the queen,” she said, noting that filming starts in June and wraps in September. “I like to be the queen. It’s good fun.”

her fourth appearance at a Revlon/NACDS party applauding how far the company has come in adding shades for women of all colors. “Gelous” of Miracle Gel: Imbued by the sold-out success of Sally Hansen Miracle Gel, nail brands are bringing their takes on faster gel treatments. Red Carpet Manicure has a faster light to produce true gel nails. Sinful Nails has a new two-step gel-like product called SinfulShine, priced at $2.99, bringing value pricing to the two-step gel manicure category. Sinful’s president and general manager Paul Murphy believes it will expand the category. There were also new nail colors producing a gel look without the need for a setting topcoat. Air-Care Gets the Beauty Treatment: Retail executives said they are casting the net for traffic-generating items to put in beauty to offset soft sales. A gift and direct TV smash (more than 10 million bottles have been sold) called Poo-Pourri, an odor-eliminating spray, is now available for the mass market. Creator Suzy Batiz was sought out at the show for samples of the product, which gained traction two years ago with a humorous video, which has more than 30 million views. Twisted: Keeping its gadget momentum going following the hit Curl Secret, Conair is making it easier to achieve the runway braid look with Quick Twist, a tool that quickly grabs and braids hair. Wellness Uprising: Liebmann looks for more interest in health-conscious products. “Consumers are looking more at ingredients and want things that are ‘better for me or at least less bad,’” she said. Most Buzzed-About: In a time of confusion among many brands, retailers credited L’Oréal for its “stability.” On the retail front, a vote of confidence was directed toward Target and its spot-on beauty departments with upgraded end caps, upscale derm products and in-store service. The presence of Mike Bloom (formerly of CVS and Family Dollar) and Bryan Pugh (formerly of Walgreens) together in their new top roles at Fred’s Super Dollar garnered attention and speculation the value chain will add more beauty. Bloom confirmed it is a category he plans to expand. Former RadioShack ceo and Walgreens president of daily living products and solutions Joe Magnacca couldn’t get through the hall at The Breakers without shaking hands and answering questions. While not revealing any future plans to rejoin the industry, he appreciated the homecoming. “I love it here and the industry,” Magnacca said.

Mass Beauty Retailers Search for Opportunities at NACDS - WWD 05.04.2015  
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