Nail polish pulls through recession with flying colors
The recession certainly did not pay many businesses or consumers any favors, but there was one silver lining for the mass market beauty sector: nail polish.
After years of battling declining sales, nail polish did a complete turnaround and actually proved to be a shining star in 2009. Not only did nail color return to the fashion world, but many cash-strapped beauty shoppers also skipped pricey salon visits and instead opted for at-home treatments.
According to research and consulting firm Kline & Co., nail color was the only category to post a double-digit gain, reaching 14.3% growth in 2009. Meanwhile, lipsticks—long touted as the economic indicator—and lip glosses declined by 5.3% in 2009.
Kline’s data found that U.S. sales in the cosmetics and toiletries market declined by 0.8% in 2009—not a detrimental drop considering the economy and the last major recession in 1991, when sales dropped 1.9%.
Helping to fuel sales of nail color was the fact that nail industry marketers responded well to consumer demand and focused on new launches, offering a new range of products to engage the recession-stricken consumer.
For example, Coty Beauty has a big story to share as it relates to its Sally Hansen nail care business.
For 2009, Sally Hansen Insta-Dri Fast Dry nail color garnered $24 million. Applied with the Perfectionist brush that contours to any nail, the color is applied with one stroke per nail and takes 60 seconds to dry. The exclusive Flexiglass Complex gives nails major shine and strength to last.
“The whole lipstick factor became a nail polish factor, and it was an amazing success story. It was about the ease of use, the terrific package and phenomenal execution,” Mary van Praag, SVP of sales for Coty Beauty, told Drug Store News during a meeting at NACDS Annual in April.
The success continues as, year-to-date, it has the No. 1 new beauty product—Sally Hansen Complete Salon Manicure. Complete Salon Manicure is expected to do more than $30 million in sales this year.
“It is amazing that there is a nail color that is the leading new product, so we have a great story,” Praag said.
Complete Salon Manicure is a manicure in a bottle, performing all five steps of a professional manicure (base coat, growth treatment, strengthener, color and top coat). Furthermore, the patent-pending technology delivers high shine over the course of 10 days. There are more than 40 salon-inspired shades in the collection.
Sally Hansen has introduced 14 new spring shades, reflecting the colors of the season and including shades created by Tracy Reese, inspired by her spring 2010 collection. The new shades include Amazing Blue, Pomegranate, Sunflowers, Iced Coffee and Silver Lining.
In other nail polish news, Nicole by OPI is rolling out “Gossip Girl”-inspired nail polish shades. As previously reported by Drug Store News, coming out at select Target stores in July and then select Walgreens, Ulta and other retailers in August are the new shades—Nicole… Spotted!; Too Rich for You; Scandals, Secrets and Sparkle; and Party in the Penthouse.
To promote the new limited-edition polish, Warner Home Video’s DVD release of “Gossip Girl: The Complete Third Season” will feature an exclusive $1-off, in-pack coupon for Nicole by OPI nail lacquers.
Mack Elevation Forum examines how NOT to become SKU-rationalized
SAN DIEGO It’s a new game. And the winners are the ones that follow the new rules of the game. That was how Swanson Group VP Dan Mack teed up the discussion here, Friday morning, at the Hilton Bayfront Hotel, for the latest edition of The Mack Elevation Forum.
The share group — which merged with the Swanson Group last November — organized and coordinated by Mack, brings together executives from noncompeting, generally smaller to mid-sized companies to examine critical business issues with the ultimate goal of enabling participants to align their sales and marketing strategies with the broader vision of the retailers they do business with. In all, executives from more than 20 different supplier companies were in attendance.
Among other things, the new rules, Mack explained, dictate that the pie of which suppliers fight to secure a share is smaller than it once was as retailers focus on growing their store brands; the new “value” consumer continues to grow in number — and value isn’t always defined by price; social media continues to level the playing field from a brand marketing standpoint, even as SKU rationalization does its best to shrink the playing field; and customer loyalty has reached an all-time low.
Special retailer guest, Bill Bergin, VP health and beauty for Rite Aid, provided attendees with an insider’s view of how suppliers can better engage Rite Aid, and shared details of key programs — such as the chain’s newly introduced Wellness+ customer loyalty card program, which the company began rolling out in May — that are priorities for Rite Aid.
Picking up on the theme of Drug Store News’ June 6 issue cover story, “7 Deadly Sins of SKU Rationalization,” Mack Elevation Forum attendees focused a good deal of the discussion around the topic of SKU rationalization — and, more importantly, how smaller vendors can keep out of the crosshairs.
To some extent, SKU rationalization has been a bit a of self-fulfilling prophesy, explained Vic Mazzacone, CEO of Drive Medical Design and Manufacturing, retail division. “The supplier community set the table for the radical SKU rationalization that is currently occurring,” he said, citing a lack of “real innovation. And overzealous marketers created a stream of new products that did not grow the segment and only traded sales. Too many brands are truly not differentiated, which makes them vulnerable.”
Dan Quail, VP sales for Similasan, noted that in one of his key business segments, the ear category, there historically have been six to seven other manufacturers competing within the section. “With some retailers, there are now only three manufacturers competing in the section,” Quail said. “It was a perfect case of companies not being differentiated and diluting the overall performance of the section.”
The bigger question, of course, is not so much what caused SKU rationalization, but what suppliers can do to keep from having their items eliminated. “Suppliers must understand emerging consumer trends and stay on the forefront of meeting evolving consumer needs,” said Mike Barna, VP sales for First Boston Pharma. “By staying out in front of the curve, you have the opportunity to create new products in growth segments where retailers are more willing to invest … and [you] are also more insulated against rationalization.”
Audie Rudiger, VP sales for Wahl, noted that the 80-year-old clipper company utilizes data from Zoomerang to identify consumer preferences, and uses that information to help support why its products must be a part of the planogram. Rudiger also recommended the online consumer survey service Questback.com for deeper qualitative and quantitative consumer feedback, and QuestionPro for more complex consumer research.
Another strategy for maintaining an item’s place on the shelf is to demonstrate that item’s contribution to the overall market basket, or the value of the trip the item generates, or that the value of that shopper is higher than the category norm, noted Tina Jackse, senior director of national accounts for Beiersdorf. “Try to establish if your brand — if not on the shelf — encouraged the consumer to leave the store.”
In the end, it is important for suppliers to leverage all of their assets to bring constant value back to the retailer. “Winning companies are bringing products to their retailer partners, but they also provide context on national best practices and are students of the important societal shifts,” Mack explained. “They understand that the game is about bringing ideas that help retailers build customer loyalty, drive trips and encourage in-store conversion. Companies offering these type of assets build strong brands and are more immune to being delisted.”
New Burt’s Bees products to hit Target shelves
NEW YORK Burt’s Bees is launching several new products at Target stores in July.
There’s the new Burt’s Bees cranberry and pomegranate sugar scrub, which will retail for $12.99. This 100% natural body scrub exfoliates to reveal silky, soft skin. Natural sugar crystals polish away dead skin cells, while a blend of cranberry seed and pomegranate oil, infused with vitamins and essential fatty acids, nourishes skin. Shea butter, olive oil and soybean oil provide a triple moisturizer effect.
New to the lip care category is Burt’s Bees nourishing lip balm with mango butter ($3).The 100% natural lip balm is specially formulated with mango butter to soothe, moisturize and protect to reveal smooth, healthy lips. To also nourish lips is the new Burt’s Bees rejuvenating lip balm with acai berry ($3). This 100% natural lip balm is made with the superfruit acai berry to provide free radical-fighting antioxidants and vitamins A, C, D and E, as well as omega oils.