Insight by Leah

It’s clear that since the economic downturn, fragrance sales have taken a nose dive.  Combined with the fact that the market is saturated with new fragrance launches every week, this sector is in desperate need of some help – and soon.  As consumers decide either to not purchase or to stick with dependable classics, marketers are scrambling to determine what appeals to consumers – and the answer is packaging and even storytelling.  One of the more successful recent fragrance launches was Coty’s Harajuku Lovers line (obviously the packaging influence came from Gwen Stefani who partnered with Coty for this fragrance).  Consumers loved the mini-dolls that each came with their own "personalities" and distinctive scent, and Coty offered the option of purchasing each doll separately, or in a collectible five-pack.  Coty is re-launching the line again this winter with a twist – each girl will be bundled up for the cold weather.  Coty has even suggested that at some point consumers may be able to order wardrobe changes for their fragrance dolls.  Coty combined unusual and even risky packaging with a great, personalized story, and also created a special website for the launch and as an ongoing way to engage consumers (http://www.hlfragrance.com/).  The site includes videos and music for each girl inspired by Stefani.  In a stale and crowded market, Harajuku Lovers engaged and inspired consumers.

Check out the girls in their winter gear!

Shared by Leah

As we all know, beauty purchases tend to be one of those "high involvement" categories for most women – it’s as important what you think as what other people are saying about the product.  Thus, the importance of product reviews for the beauty industry.  Bellasugar.com has a section of their website specifically dedicated to product reviews provided by their editors and, more importantly, by their readers.  Additionally, Bellasugar.com has even highlighted for site visitors who are the most active reviewers and who are the most trusted reviewers.  Further, the site has made it easy to search for either a specific product with easy to browse categories or the best and worst reviewed products, and even points out for readers a product review of the day (check out this one on Cetaphil Daily Cleanser).  All this incredible content begs the question – what is the beauty industry, and specifically the beauty companies, doing to engage these active reviewers and to connect with sites like Bellasugar.com?  These product review forums are the perfect venue for companies to engage their stakeholders, broaden a fan base, receive valuable insights (check out the people who slammed the L’Oreal Vive Pro Line, which unfortunately for L’Oreal now appears as one of the worst reviewed products) and get feedback before an expensive product launch.

The internet route out of recession

Insight by Leah

In an effort to expand into the premium market for men’s product, P&G completed its acquisition of the The Art of Shaving.  P&G has not been shy about it’s recent strategy to "win with men" and has made an effort to diversify and improve its beauty division sales with the purchase of mass brand Gillette in 2005.  However, the purchase of The Art of Shaving firmly plants P&G in the prestige sector now as well since The Art of Shaving has 36 retail outlets and 600 retail partners, which include Saks Fifth Avenue, Sephora, Bloomingdale’s and Macy’s, where it competes against Molton Brown, Jack Black and Acqua di Parma.  As well, in an interesting sidebar, P&G and The Art of Shaving both noted that neither has fully exploited the Internet yet as an effective sales channel – it currently accounts for only 10% of The Art of Shaving’s sales. 

WWD Excerpt:

Procter & Gamble Co., which recently made the phrase “win with men” an incessant company mantra, is now fully armed to target the premium male shopper with its Monday purchase of the prestige grooming firm The Art of Shaving.  Details of the deal were not disclosed; however, industry sources estimate P&G likely paid in the $60 million range for the manufacturer and retailer of shave and skin care items, twice the Miami-based firm’s 2008 annual sales. Read the complete article here.

Insight by Leah

Although beauty product sales are declining overall, a bright spot of news appeared – Internet sales are up.  Over the coming months, it will be interesting to see if retailers and brands shift their focus and campaigns to the Internet as it represents a viable and cost effective sales channel.  As well, it appears that consumers are increasingly using the Internet for research and review purposes, increasing the importance of beauty bloggers, Twitter and other forms of social media.  The Nhuch will continue to explore this growing sales channel and its influence.

BeautyPackaging.com article excerpt: