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Four Play With its Aromatic Blends line, due in July, Kiehl’s is stepping squarely into the fragrance arena. Four scents — Orange Flower & Lychee, Vanilla & Cedarwood, Nashi Blossom & Pink Grapefruit and Fig Leaf & Sage — will bow in Kiehl’s full U.S. distribution, which is about 300 department and specialty store doors and 47 freestanding Kiehl’s boutiques, with a global rollout to follow. The line could do $20 million at retail in the U.S. in its first year. For more, see page 8.



Betsey Johnson Rejigs Strategy By ROSEMARY FEITELBERG

NEW YORK — Betsey Johnson is ready for a new chapter. On Thursday, it was revealed that Betsey Johnson LLC has filed Chapter 11 and, as a result, the bulk of the designer’s boutiques will close and about 350 staffers are expected to lose their jobs. Betsey Johnson LLC is the licensee that operates the designer’s 63 freestanding stores, women’s apparel and e-commerce. It is run by Castanea Partners, the Boston-based private equity firm that bought a controlling interest in the company in 2007. Despite all the upheaval, Johnson remains creative director of the brand and she will continue to oversee the design of her sportswear, accessories and various licenses. The designer, who turns 70 in August, still plans to have a runway show in September and she will start shooting a reality show in a few months. These and other plans were shared by Johnson and Steve Madden, founder of Steven Madden Ltd., which took over a $48.8 million loan to Betsey Johnson LLC and absolved it in exchange for the brand’s intellectual property. Madden produces some of the Johnson accessories and licenses out categories such as legwear and outerwear. Going forward, the emphasis will be on the moderately priced Betsey Johnson label, which is sold at Macy’s Inc. and other retailers, as well as the litany of other categories. The Betsey Johnson Collection, which is carried in the designer’s freestanding stores and has dresses that retail for $395, has not sold nearly as well as the more middle-of-the-road Betsey Johnson label, which has a retail sweet spot of $128 to $148. About 75 percent of the spring line will be moderate-priced goods, with the remainder being editorial- and designer-range pieces. “I love the moderate-price range. It is in sync with SEE PAGE 12

Mass Beauty’s New World By FAYE BROOKMAN and BELISA SILVA IT MAY LOOK LIKE the good old days are back in the drugstore world, but a revolution is afoot. That was the view from the National Association of Chain Drug Stores Annual Meeting in Palm Beach, Fla., last weekend. As manufacturers and retailers expressed a renewed confidence, it seemed like the halcyon days of past decades were alive again. But there’s a catch. “This is not growth for the sake of growth — it is clever growth,” said Ido Leffler, co-founder of Yes To Inc., who chatted about the silver lining of surviving a severe recession. “These are happy days — happy, smart days.” The point was more sharply made by WSL Strategic Retail founder Wendy Liebmann, who warned that the drugstore industry faces competition from a gathering digital juggernaut. But such thoughts, like the rainy patch on Saturday, did little to dampen spirits of the more than 2,100 top manufacturer and retail executives who, for the most part, said business is brightening. The retro mood was heightened by former President George W. Bush, who told personal stories from his days in office. The country’s former top chief executive’s words reflected a buoyant mood. “You cannot lead without being optimistic,” he said in a rare public appearance. His advice to business leaders was “knowing what you don’t know and finding people who do know.” At the close of each business day, the parties kicked off. They were more jovial and relaxed than in the last few years — with a nod to decades past thanks to performances by Chicago, Chris Isaak and The Moody Blues. L’Oréal’s “Mad Men”-themed party




WWD FRIDAY, APRIL 27, 2012 5 WWD.COM The scene at the L’Oréal party.

Upbeat Mood at NACDS Belies Challenges Ahead {Continued from page one} “Categories shifting online faster evoked memories of the days when many are generally those where it is easier of the participating drug chains were to browse an exhausting selection from formed. “We are definitely seeing posi- your couch rather than traveling from tive reaction to our products and innova- store to store,” according to the report. tion,” confirmed L’Oréal Paris president “As [sites like] grow, retailers across channels are left wondering Karen Fondu. At Revlon Inc.’s annual Friday night where their baby business went.” In order to drive in-store purchasfete, brand ambassador Emma Stone cited some of the reasons she was attract- ing, Liebmann said drugstores must up ed to the firm: accessibility, quality prod- the ante when it comes to providing cusuct and its support of women’s charities, tomer service and an overall shopping would not comment on its ongoing battle namely those taking on breast cancer. “I experience. For new launches, she said to acquire Avon Products Inc. With the added realization that the grew up surrounded by Revlon because revamping promotional strategies and init’s what my mom wore,” said Stone, who jecting sampling initiatives are critical in complexion of America is changing, companies also unveiled ramped-up plans to named Revlon blow dryers and founda- order to stay in the game. Procter & Gamble Co. is targeting the reach ethnic consumers, namely Latino tions as childhood favorites. Joining Stone were Revlon execu- tech-savvy beauty consumer with a se- women. Even Burt’s Bees, known for tives, including Alan Ennis, president ries of initiatives that make it easier to its natural positioning, has expanded and chief executive officer; Chris Elshaw, purchase and become aware of its cross- its reach to “round out the portfolio” to chief operating officer; Julia Goldin, ex- category product offerings. From dis- Hispanic consumers, with new lip shades ecutive vice president and global chief playing QR codes on its packaging and designed to flatter darker complexions. marketing officer, and John Collier, se- advertisements to offering a tear-jerking Walgreen Co.’s president of daily living nior vice president and general manager “Thank You Mom” YouTube commercial products and solutions, Joe Magnacca — clearly a man in demand at of the U.S. region. the meeting — said the newest Along with an ode to the past, Walgreens store would bow in the future was on the minds of Puerto Rico next week, with cosmetics executives as they hama design and merchandise asmered out a road map to keep the sortment aimed to please the drug channel competitive against local market. It is the latest a powerhouse competitor — onto feature a Look Boutique, line selling. a concept first introduced al“Is the industry ready for most three years ago in Duane the impact of digital?” asked Reade. Elements from the Liebmann, who said the conLook Boutique are used stratinuing shift towards cross-cattegically at Duane Reade and egory online buying presents Walgreens stores — the last an interesting conundrum for major debut was in January drugstores looking to increase in Chicago. Elements to be inbeauty sales. Much like consumcluded in Puerto Rico include ers’ buying patterns for books, features first introduced at the music and movies, shoppers 40 Wall Street flagship in New are moving more and more to York, like nail services, a blown the Web for their drugstore purHenric Sark, general manager of Active Cosmetics at L’Oréal USA; out fragrance selection (the exchases and seem to be gravitatKaren Fondu, and David Greenberg, president of Maybelline. isting Puerto Rico stores are ing toward big-box e-tailers like rather than to proprietary for the 2012 London Olympics — which, among the best sellers of scents in the enclaimed P&G, became the number-one tire chain) and dermatological skin care drugstore Web sites. “[Beauty] retailers have to realize they online advertisement in the world after consultations. There are currently 112 are competing with Amazon every day,” just two days — the company is focused Walgreens stores on the island. “Puerto Rico is a major market for declared Candace Corlett, president of on extending its viral reach. John Burgfechtel, vice president of us,” said Bill George, president and WSL Strategic Retail. Liebmann and Corlett cited a recent sales, customer marketing and sales oper- chief operating officer of Markwins Pulse study, which showed that some of ations for Coty Beauty, agreed that every- International, who added that walletthe biggest categories consumers are pro- thing is for sale via the Web for all front- friendly beauty brand Wet ‘n’ Wild will curing through the Web include electron- end business. To keep shoppers wanting be on offer in the new Walgreens outics, baby and luxury. Those dubbed “next to visit brick-and-mortar stores, Coty is post. The brand’s newest spokeswoman to climb” include beauty, specifically cos- working with retailers to provide digital — Fergie of the Black Eyed Peas — is metics, skin and hair care, men’s groom- assets that create an environment of edu- fronting its advertising, both in store and ing and lip care. Commodities like oral cation and brand interaction. “Testers, online, helping to boost the brand’s Web care, cleaning products and paper goods imagery and assortment play a large role presence (she has more than six million are still purchased primarily in brick- in success,” he said. “Getting fragrance Facebook fans) and to continue to attract shoppers in the door is crucial.” The firm the beauty-obsessed Latina consumer. and-mortar outlets — for now. “We have new products that speak to the consumers,” said George, who added that the brand performs exceptionally within dense urban and ethnically diverse areas. “We are showing double-digit growth over the last six months.” The quest for value encouraged Markwins to do its first-ever coupon, which will debut in May. Those in attendance also discussed how beauty purveyors are looking to expand in other doors, including efforts by warehouses, such as Sam’s, to venture back into beauty. Former CVS executive Mike Bloom, now president of Family Dollar Stores Inc., revealed plans to open 500 more stores and extend much deeper into beauty. Several beauty firms confirmed they are looking for ways to serve the value store trade channel without cannibalizing traditional sales. “Don’t overlook men” was also a battle cry — even from male executives. “Men’s grooming is a great opportunity,” said Steven Anderson, president and chief executive officer of NACDS. Mark Griffin, Julia Goldin, Chris Elshaw, Emma Stone, Alan Ennis and John Collier.

OF NOTE: ■ NACDS chairman Bob Loeffler handed off the gavel to Greg Wasson, president and ceo of Walgreen Co., who discussed “[phasing] out terminology such as front end and back end and [beginning] to think about the total store.” ■ Love & Toast was represented for the first time ever at NACDS, hoping to tap into retailer demand for brands to distinguish from the competition. ■ Among the themes that have inspired new products from Physicians Formula Holdings Inc. ceo Ingrid Jackel were the consumer’s increasing desire for calm and privacy, neurocosmetics and do-it-yourself dermatology. ■ NACDS honored two industry icons: Andrew Giancamilli, the former ceo of Rexall Pharma Plus and past chairman of NACDS, and M. Jerome Brown, former vice president for industry and customer development at Unilever. ■ Come May, Conair will introduce a men’s 2-Blade Trimming System and an implement to maintain stubble. ■ Burt’s Bees will add an antiaging face care line for dry skin called Ultimate Care in January. ■ According to chatter, Lumene and Physicians Formula may be next to introduce BB creams. ■ Kiss will launch an at-home gel product with an LED light in January. ■ Sinful Colors’ general manager, Paul Murphy, said the firm is focusing on targeted trend color collections. ■ Is gray the new blonde? Multiple

executives touted the opportunities to launch hair color products to accent gray. chairman of Lewis Drug, agreed, “I want to see more products out there for men. It is time for more men’s grooming options.” Griffin was among several retailers who said they are tinkering with the ambiance of stores. An upscale cosmetics prototype is being unveiled in store resets this summer in other stores after a successful test, Griffin said. Barbara Zamudio, vice president of mass merchandising and pricing for Ulta, said the chain continues to prosper from new lines and enhanced store design, including brand boutiques.

Upbeat Mood at NACDS Belies Challenges Ahead, WWD April 27, 2012  

It may look like the good old days are back in the drugstore world, but a revolution is afoot.That was the view from the National Associatio...

Upbeat Mood at NACDS Belies Challenges Ahead, WWD April 27, 2012  

It may look like the good old days are back in the drugstore world, but a revolution is afoot.That was the view from the National Associatio...