Page 1

GLOBAL REACH

AS PROFITS AT ERMENEGILDO ZEGNA RISE 13 PERCENT, THE BRAND PLANS MORE RETAIL EXPANSION. PAGE 2

WWD FRIDAY, MAY 3, 2013 ■ WOMEN’S WEAR DAILY ■ $3.00

In the Spirit The Estée Lauder brand will introduce Modern Muse, its first major women’s fragrance in a decade, in September. The scent is designed as an olfactive ode to the dynamic self-confidence of the modern woman. Expectations are running high, with industry sources speculating that the volume target is as high as $95 million in retail sales globally for the first full year. For more, see page 6.

GOING LUXE THE BELLEVUE COLLECTION PLOTS A $1.2 BILLION EXPANSION TO RAISE THE LUXURY QUOTIENT IN SEATTLE. PAGE 12 BANGLADESH TRAGEDY

Retailers, Groups Vow Compensation By MAYU SAINI WHO IS GOING TO PAY and how much? That is among the questions being asked as the death toll from the collapse of the apparel factory building in Savar, near Dhaka, Bangladesh, rose to 430 on Thursday, with more than 520 injured, out of which 100 amputations have been estimated. The rest of the rescued workers will also need new jobs, as well as immediate payments. Hundreds of workers are still missing, and eight days after the eight-story building collapsed, bodies are still being recovered from the debris. The building, Rana Plaza, housed five garment factories, with more than 3,000 workers in the building at the time of the collapse. The incident is being described by authorities as the worst industrial accident in the garment industry in Bangladesh and the world. “The total compensation figure is likely to be over $30 million in addition to the cost of emergency treatment,” the Clean Clothes Campaign said last week, when the death toll was known to be 300. But a presentation by the Bangladesh Garment Manufacturers & Exports Association earlier this week noted a vastly different number, stating that the amount needed for “compensation, rehabilitation and long-term treatment was estimated at $12 million.” The organization also noted that an amount of 125 million Bangladesh taka, or $1.6 million at current exchange rates, had already been spent on rescue activities and treatment. Treatment has been provided free of charge to all of the injured, officials said. Talking about the range of estimates, a senior economist in the government told WWD that would vary widely, depending on who was paying. “Living standards are experienced in substantially different ways in an emerging economy. On the other hand, the expectation also goes up substantially when the money is coming from a global brand or retailer,” he said, while explaining that although $38 a month, the minimum wage that is paid to the garment workers in Bangladesh, appears paltry, it is substantially higher SEE PAGE 3

Beauty Grows at Mass By FAYE BROOKMAN

PHOTO BY JOHN AQUINO; STYLED BY TYLER RESTY

PALM BEACH, Fla. — With customers returning to mass-market cosmetics departments with open wallets, retailers at the 80th edition of National Association of Chain Drug Stores Annual Meeting charged beauty companies to bring them fresh and relevant items. And, many want assortments customized for their own stores to differentiate them from the competition. Color cosmetics sales in the mass market are up a healthy 5.4 percent for the first quarter, ended March 30, according to Nielsen data. The catalyst is the nail category, with gains in the high-double digits across some brands. However, just as clouds threatened to drive poolside gatherings of high-level execs inside at The Breakers hotel last week, there was fear economic uncertainty could dampen results for the second half of the year. Much of the industry’s success hinges on consumers’ unrelenting interest in nail-care products, coupled with retailers’ ability to achieve sales goals. To drive that growth, the 60-plus retail companies that attended the meeting — ranging from Wal-Mart to Ulta — asked the 20 beauty companies present for innovation, support of loyalty programs and items that build basket transactions. Nails were ubiquitous at the event, including at Revlon’s opening reception, hosted by brand ambassador Olivia Wilde, where partygoers were treated to nail-art application, and at the Wet ‘n’ Wild’s suite at SEE PAGE 7


WWD FRIDAY, MAY 3, 2013 7 WWD.COM Fom left to right: Revlon’s Jamie Bernt, Joanne Santos, John Harrington, Simon Worraker, Julia Goldin, Chris Elshaw, Donna Baird, John Collier, Jon Levin and Dino De Iuliis.

Talk of Nail Trends, Value Dominate NACDS {Continued from page one} SensatioNail. “Nail polish is still driv- nogram features a huge commitment to The Breakers, where an excited — and ing cosmetics and gels are helping drive nails, including treatment, gels and color. The desire to offer something differpregnant — Fergie showed off favorite nail,” said Joel Carden, executive vice shades from her CenterStage Collection president at Pacific World, who noted ent was a mantra. Target will test NYX gels are 8 percent of nail polish sales, on in 100 doors, as well as “brand agnostic” from Wet ‘n’ Wild. beauty advisors in 150 doors. Attendees “This is one of my favorite lipstick a path to hit 10 percent by yearend. Harvey Alstodt, president of MBA identified NYX as an example of a beaushades,” said Fergie, grabbing a pink shade called V.I.Pink, which donates a Beauty Inc., however, thinks there is ty company with out-of-the-box ideas, portion of sales to amfAR. “This is also a a portion of women looking for more such as an eyeliner called The Curve in great item,” she added, pointing her slick natural options. To that end, he’s of- a creative elliptical shape that makes it polished purple-and-gold talons to her fering WaterWorks, a water-based nail easier to apply than traditional pencils. Offering value while also encouragcolor. That’s one of several innovative eye primer. The type of buzz Fergie has delivered items he showed at the meeting, along ing shoppers to trade up to higher price to Wet ‘n’ Wild is what top executives said with Tweets, a tween nail color carried points or multiple items was a theme. First-time annual meetthey hope to see across all ing attendee E.l.f. Cosmetics beauty brands. Bill George, showed how its breadth of president and chief operating assortment offers more than officer of Markwins Beauty, just “one size fits all,” said the parent company of Wet ‘n’ Shawn Haynes, the brand’s Wild, said Fergie was tapped vice president of sales. With after market research idenits traditional Essentials ($2 tified her as a celebrity that and under), E.l.f. encourwould resonate with beauty ages shoppers to place mulconsumers. The partnership tiple items in their basket. It has been fortuitous, with Wet also works to trade up shop‘n’ Wild volume chalking up pers with its Studio collecmore than two years of doution (priced at $6 a product), ble-digit growth. which is growing in chains Some retailers worry such as Walgreens. the nail business will have With much of the action a challenge matching gains in value pricing, Physicians accrued in the last year, but Formula focused on its unique suppliers said the category positioning. Now owned by is here to stay and won’t Markwins, Physicians Formula fizzle out, as it did after the Markwins Beauty founder and chief executive officer Eric Chen and Fergie. is the “fastest-growing premiChanel Vamp craze. um makeup” in mass, accordRetailers who stopped ing to chief executive officer by Sinful said the company Ingrid Jackel, who said teamshowed that the nail busiing up with Markwins has been ness is on fire. To feed dea good fit since its major brand, mand for shiny, gel-like nail Wet ‘n’ Wild, is at the opposite colors, SinfulColors is adding end of the price spectrum. SinfulShine Gel Polish in 32 The company also hamshades at Walgreens. The commered home its “healthy” pany is transitioning to a new brand characteristics, which name, called Global Value Jackel said hit a sweet spot Brands, to bring Pure Ice and with consumers. Physicians’ Sinful under one umbrella. BB assortment of a cream, Manufacturers insist the powder and concealer has degel technology is still in its livered “incremental” volume infancy. Sources at the meetand has not cannibalized from ing said more launches are existing items in Physicians’ in the pipeline, including an lineup, Jackel said. “We reentry from Essie. Their only cently launched in France and fear is an influx of inferior it has been a very good expeproducts that could tarnish rience because it encouraged the experience. E.l.f. Cosmetics’ vice president of sales Shawn Haynes and cofounder and us to get back to our roots and Staying on top of technolchief executive officer Joey Shamah. realize who we are,” she said. ogy and educating women As retailers look for their own fit in about how to use gels properly to remove by Wal-Mart and New York’s upscale any “barriers to use” is the message from Zitomer, and a treatment assortment the market, they are calling on suppliRed Carpet Manicure. The company be- called Dr. Marvey. “I don’t want to be a ers to give them exclusives, be it products, displays or promotions. As an lieves gel polish could eventually hit 50 ‘me too’ company,” said Alstodt. No matter what the nail product, re- example, Chris McClain, president of percent of sales, especially since gels are now 55 percent of salon business. Red tailers hope the frenzy continues since Advanced Beauty Labs, said the comCarpet also is adding two treatment prod- most have allocated major real estate to pany’s Bodycology line has 16 scents, but ucts to address damage, one is LED-cured. nail. CVS Pharmacy has more than 2,000 that not all of them are in all retailers. The healthy state of at-home gels Nail HQ departments, Rite Aid has a “We’re able to segment and target store was echoed at Pacific World, makers of large nail area and Wal-Mart’s new pla- clusters,” he said.

Heard at NACDS Annual... n Appliances Buzzing: Borrowing a page from Clarisonic and using its appliance knowledge, Conair is bringing out True Glow, a sonic skin-care tool priced under $100. Harvey Alstodt, president of MBA Beauty Inc., is distributing the skin-care device Tanda, which targets discoloration and fine lines. Retailers agreed consumers are ready to buy these appliances at mass stores. n Yarnell Returns to Beauty: Lisa Yarnell is back in the business and attended the meeting on behalf of Continental Consumer Products, makers of Salon Grafix, which has repackaged and is primed for new launches. n Fragrance Redux: With color rebounding, retailers hope fragrance is next. Joel Ronkin, executive vice president and general manager in North America for Elizabeth Arden Inc., said almost every major retailer is making huge strides to adopt open-sell environments and to add testers. “Consumers are returning to the category,” he said, adding prestige is already up nicely. n P&G Innovation Studio: Once again, the Procter & Gamble Co. offered a respite from the sun and work in its studio with free shaves for men, makeovers for women and reflexology for all. The company also showed its health and beauty innovations, including Olay Fresh Effects and Cover Girl Clump Crusher mascara, which one retailer deemed the fastest-selling item in the store. n Gavel Exchange: Outgoing NACDS chairman Greg Wasson, president and chief executive officer of Walgreen Co., handed over the gavel to Robert J. Narveson, president and ceo of Thrifty White Pharmacy. n Olivia Wilde Gets Excited: Revlon ambassador Olivia Wilde admitted it is “surreal” when she sees her image in the drugstore and said even as a little girl she loved going to drugstores and playing with makeup. “It is an honor to catch a glimpse of my mug in your stores,” she said.

In his presentation to suppliers on how to sell dollar stores, Family Dollar president Mike Bloom discussed the need for products customized to the value proposition at his growing chain. The desire for customization stems from better use of consumer data gleaned through loyalty programs, said Wendy Liebmann, founder and ceo of WSL Strategic Retail. “Prior to now, retailers never knew beyond the transaction what the consumer was doing. Now they know. It’s about what the consumer is buying — and what else they’re buying,” she said. In meetings with suppliers, Walgreens talked up its growing loyalty program. CVS’ program is already well established and has a powerful beauty following. This year’s meeting attracted high-level speakers and entertainment, ranging from Pat Benatar and Michael McDonald at NACDS events, and Nicole Scherzinger and Train at corporate brand functions. Jody Pinson, the new vice president, merchandising of beauty for Wal-Mart, praised the efficiency of seeing so many beauty suppliers in just four days. The meeting was a final opportunity for NACDS to tout its upcoming Total Store Expo, which melds Marketplace, Logistics and Pharmacy into one huge show. “We are definitely supporting it and NACDS,” said Pacific World’s Carden. The meeting kicks off in Las Vegas on Aug. 10.

Beauty Grows At Mass - (WWD Issue 05/03/2013)  

With customers returning to mass-market cosmetics departments with open wallets, retailers at the 80th edition of National Association of Ch...

Read more
Read more
Similar to
Popular now
Just for you