CosmeticOBS - L'Observatoire des cosmétiques

Press review : August 2019

Our press review service automatically collects all current topics related to the cosmetics sector recently published on the Internet, all media combined.


08/28/2019 COTY, plombé par des dépréciations, creuse ses pertes

(AOF) - Coty a accusé une perte nette trimestrielle, pénalisée par une charge exceptionnelle de trois milliards de dollars liée à des dépréciations d’actifs dans sa branche de cosmétiques grand public. Le parfumeur américain, créé par l’Ajaccien François Coty au début du 20ième siècle, a déprécié les actifs acquis en 2016 auprès de Procter & Gamble en raison d’une croissance atone. Au quatrième trimestre de son exercice fiscal clos fin juin, la perte nette atteint 2,08 milliards de dollars, ou -3,72 dollars par action, contre une une perte de 181,3 millions, ou 24 cents par action un an plus tôt.

Hors éléments exceptionnels, le BPA est ressorti à 16 cents, conformément aux attentes.

Le revenu net est ressorti à 2,12 milliards, conter 2,3 milliards un an plus tôt. Les analystes tablaient sur 2,11 milliards.

Pour l’exercice en cours, Coty prévoit une croissance d’environ 5% de ses bénéfices. Wall Street vise un BPA de 68 cents, soit en hausse de 5,8%.

Les spécialistes du secteur sont très confiants en constatant la très forte demande de la clientèle chinoise. Morgan Stanley estime que le marché chinois, qui a procuré à l’industrie du luxe 60% de sa croissance sur les quinze dernières années, devrait augmenter ses dépenses de 90% d’ici à 2025. Même optimisme du côté du cabinet de conseil Bain & Company. Parmi les facteurs de croissance se trouvent l’expansion rapide de la classe moyenne, qui devrait représenter les deux tiers des ménages chinois d’ici 2027 et la demande toujours soutenue des Millennials, particulièrement sensibles aux tendances innovantes telles que la convergence de la mode et du sport.

Une étude du Boston Consulting Group estime que, d’ici à 2024, les consommateurs chinois représenteront 40% des clients du luxe. Leur contribution à la croissance de ce marché est estimée à 70% pour les cinq prochaines années.

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08/28/2019 Pour la première fois, Chanel engage une mannequin transgenre comme égérie

L’Américaine Teddy Quinlivan est le premier top modèle ouvertement transgenre à devenir l’égérie de la célèbre maison de couture française.

“Toute ma vie a été un combat”. La mannequin américaine Teddy Quinlivan a annoncé, lundi, sur son compte Instagram, avoir été choisie par la prestigieuse maison française Chanel pour être le nouveau visage d’une campagne publicitaire pour sa gamme de cosmétiques. Elle devient ainsi le premier top modèle ouvertement transgenre engagé par la marque française.

“Je me rends compte que je ne pleure plus quand les choses sont tristes. Mais n’est-ce pas intéressant quand nous versons des larmes dans les moments de triomphe? Toute ma vie a été un combat. De mon harcèlement constant à l’école, par des enfants qui menaçaient de me tuer et me racontaient en détail comment ils allaient le faire, à mon propre père qui me frappait et me traitait de ‘tapette’, en passant par les retours de bâton reçus après que j’ai ouvertement dévoilé avoir été sexuellement agressée dans l’industrie du mannequinat… Cette victoire me fait dire que toutes ces merdes en valaient la peine”, écrit la jeune femme de 25 ans dans un touchant message sur Instagram.

Teddy Quinlivan a fait son coming out transgenre en septembre 2017, après avoir défilé pour Chanel, Louis Vuitton, Gucci et Chloé, rapporte le magazine américain WWD. Elle a depuis fait la couverture de plusieurs publications reconnues comme L’Officiel, Porter Magazine et Wonderland.

Voir cette publication sur Instagram

💄CHANEL BEAUTY💄 -I find I don’t cry anymore when things are sad, but isn’t it interesting when we shed tears in moments of triumph. This was one of those triumphant cry moments for me. My whole life has been a fight. From being bullied at school consistently, kids threatening to kill me and going into graphic detail how they were going to do it, my own father beating me and calling me a fagot, to receiving industry blowback after speaking publicly about being sexually assaulted on the job… This was a victory that made all of that shit worth it. I had walked 2 shows for Chanel while I was living in stealth ( stealth meaning I hadn’t made my trans identity public yet) and when I came out I knew I’d stop working with some brands, I thought I’d never work with the iconic house of Chanel ever again. But here I am in Chanel Beauty Advertising. I am the first openly trans person to work for the house of Chanel, and I am deeply humbled and proud to represent my community. The world will kick you down, spit on you, and tell you you’re worthless. It’s your job to have the strength to stand up and push on, to keep fighting, Because if you give up then you will never experience the tears of triumph. Thank you to everyone who made this dream a reality! @nicolaskantor @shazmakeup @sebastienrichard1 @casadevallbelen

Une publication partagée par Theodora Quinlivan (@teddy_quinlivan) le 26 Août 2019 à 9 :20 PDT

“Je suis fière de représenter ma communauté”

Teddy Quinlivan raconte qu’elle “savai[t] qu’elle allai[t] arrêter de travailler pour certaines marques”, après son coming out, et “pensai[t] qu’elle ne collaborerai[t] plus avec la maison iconique Chanel”.

“Je suis profondément honorée et fière de représenter ma communauté. Le monde va te donner des coups, te cracher dessus et te dire que tu ne sers à rien. Mais c’est ton travail d’avoir la force de te relever et de persévérer, de continuer à te battre. Parce que si tu abandonnes, tu n’expérimenteras jamais de larmes de triomphe. Merci à tout le monde d’avoir fait de ce rêve une réalité”, conclut-elle avec force.

Au début du mois d’août, une autre mannequin transgenre, Valentina Sampaio, a également partagé une importante nouvelle. La Brésilienne de 21 ans est devenue le premier top transgenre à rejoindre la marque de lingerie Victoria’s Secret.

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08/22/2019 Esthéticien(ne) : métier et salaire

Les esthéticien(nes) peuvent accéder à une palette de métiers variés et exercer dans différents environnements professionnels. Mais quelles sont les compétences requises pour devenir esthéticienne ?

Professionnels de la beauté, les esthéticien(nes) travaillent en contact permanent avec des clients. Il est donc essentiel de posséder des qualités relationnelles, d’être à l’écoute et également de savoir faire preuve de pédagogie. Lorsqu’il travaille en institut de beauté, dans un spa, dans une parfumerie, ou encore dans un centre de thalassothérapie, il peut être amené à vendre des produits et doit donc avoir le sens de la relation client. Lorsque les esthéticien(nes) se spécialisent dans la socio-esthétique pour intervenir auprès de personnes fragilisées (dans les hôpitaux, maisons de retraite, etc.), une grande capacité d’écoute et un bon équilibre psychologique sont indispensables.

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Une esthéticienne doit maîtriser un certain nombre de techniques professionnelles pour pratiquer des épilations, des manucures, des massages esthétiques et des soins adaptés aux différents types de peau. Ces professionnels de la beauté possèdent une bonne connaissance des produits cosmétiques et maîtrisent les techniques de maquillage. Le secteur de l’esthétique offre plusieurs possibilités de spécialisation, par exemple dans le maquillage, les soins esthétiques en thalassothérapie, ou encore dans les massages esthétiques.

Les esthéticien(nes) peuvent prendre la tête d’un ou plusieurs instituts. Dans ce cas, il faut développer des compétences en gestion d’activité et gestion du personnel, en formation des effectifs ou encore dans le développement commercial.

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Le CAP esthétique-cosmétique-parfumerie est la première marche pour accéder au métier. Il se prépare après la troisième, dans un lycée professionnel, un centre de formation des apprentis (CFA), une école ou un centre de formation. C’est une formation qui permet d’acquérir les gestes techniques de la profession. Le diplôme peut être complété par un brevet professionnel en deux ans. Le bac pro esthétique-cosmétique-parfumerie permet de former des vendeurs-conseillers dans le domaine.

Après le bac, il est possible de se former aux fonctions d’encadrement avec le BTS métiers de l’esthétique-cosmétique-parfumerie. Ce diplôme permet de diriger des instituts de beauté, des spas, de travailler en parfumerie ou dans des grands magasins. Ces diplômés peuvent accéder à de nombreuses formations pour se spécialiser dans des domaines spécifiques comme le maquillage ou les massages esthétiques.

Autre possibilité, s’orienter vers la socio-esthétique pour intervenir dans les maisons de retraite, les hôpitaux, des centres spécialisés, etc. Différents diplômes universitaires (DU) permettent de se spécialiser dans la socio-esthétique.

Les esthéticien(nes) démarrent généralement leur carrière au SMIC. Les professionnels peuvent ouvrir leur propre institut ou magasin. Pour cela, il faut être titulaire du BP esthétique-cosmétique-parfumerie ou du BTS esthétique-cosmétique-parfumerie.

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08/21/2019 Unmasking The Hidden Billionaire Behind A Korean Beauty Kingdom

iu Jing, 32, is visiting Seoul from China’s eastern seaboard. Other tourists might spend their day taking in the capital’s sights. Not Liu. She’s lining up behind at least a dozen compatriots in a duty-free shop, waiting her turn to buy JM Solution facial sheet masks. Each box of ten will cost her about $30, but Liu won’t walk away with just one. For the equivalent of $18,000, she and the others buy three refrigerator-size palettes of carts – so big they have to be wheeled away on dollies.

This is the latest article is in a new series: World of Forbes, a collection of stories from our 35 licensed editions and global partners around the planet. This story originally appeared in the July-August issue of Forbes Asia.

Liu isn’t buying them for herself. She’s a daigou – a Chinese term for surrogate buyers who venture abroad to stock up on popular products and resell them back home. To say JM Solution masks are popular is an understatement. Between the Honey Luminous Royal Propolis Mask, the Lacto Saccharomyces Golden Rice Mask, and the Active Pink Snail Brightening Mask, JM Solution’s owner, GP Club, has sold more than a billion skin-care masks, mostly in China, since launching them in mid-2017. “It’s the No. 1 seller in China,” Liu says, adding that she can earn as much as 20% selling JM masks back home in Shandong province. “I’ve been coming here once a month for the past six months.”

Daigous like Liu are partly responsible for catapulting Kim Jung-woong, GP Club’s founder and CEO, onto Forbes’ list of Korea’s 50 Richest at No. 30 with an estimated net worth of $1.15 billion. Kim, now 44, started his own video game store in high school and within a decade had earned enough to venture into China’s gaming accessories market. A decade after that he pivoted to cosmetics in the mainland. But after a diplomatic dust-up that began in 2016 sparked a boycott in China of Korean products, Kim cultivated a following among the mainland’s social media influencers, triggering an invasion of daigous determined to bypass the boycott and ship GP Club’s masks from Korea to sell back in China themselves.

The daigous not only blunted the boycott’s impact, but also helped GP Club grab market share from big-name Korean brands such as Amorepacific and LG Household & Health Care. Driven largely by demand from China’s consumers, sales at GP Club rose nearly tenfold last year to 514 billion won ($460 million), while net profit rose more than 30 times, to 170 billion won. “I rode the wave well,” Kim says in his first major interview since becoming a billionaire. To cope with the growth, he quintupled his staff to 170 last year. “But if you asked me to do it again, I probably couldn’t,” he says.

GP’s staggering expansion prompted Goldman Sachs last October to pay 75 billion won for a 5% stake in the company, making Kim, who with his wife and daughter owns roughly 95% of the company, a billionaire. Confident it can sustain the momentum, GP says it has mandated banks to arrange an IPO in Seoul, which could take place later this year. “While the incredible growth in sales of JM Solution’s innovative products caught our initial attention,” says Jonathan Vanica, a managing director at Goldman Sachs who led its investment in GP, “it was the company’s deep understanding of the Chinese consumer’s ever-evolving, internet-driven tastes and their firsthand knowledge of online and offline nationwide distribution channels that truly excited us.”

Kim’s road to China’s $15 billion a year facial mask market was long and winding. The youngest of three siblings, Kim had a comfortable childhood until his father, a well-to-do bank branch manager, lost his job and the family’s money in a failed foray into politics. Kim’s father traded his white-collar shirts for a construction laborer’s helmet. They were hard times, Kim recalls. Rice was a luxury; the family ate barley instead.

When Kim was 15, his father died of liver cancer, leaving his mother and grandmother to raise him, his brother and sister. Hardship ignited his entrepreneurial flame. “Early on, I felt driven by the need to make money,” he says. An avid gamer like so many teenagers, Kim landed a part-time job at a small video game store run by an elderly couple. Kim’s fascination with games quickly translated into a talent for selling them. With $4,000 he saved from his job and $3,000 borrowed from his family, Kim opened his own small store selling video games and consoles from an apartment and called it Game Paradise, the origin of today’s GP Club.

Kim would open shop after school and sell video games until 11 p.m., fashioning homemade loyalty cards – “Buy 10, get one free” – to encourage repeat business. When he’d made enough money, he used it to open a second store in another apartment nearby. By the time he was 20, Kim had amassed a small fortune of 300 million won (equivalent to about $500,000 today).

After a four-year interlude – two years performing Korea’s compulsory military service and another two earning a degree in interior design from a vocational college – Kim started plowing his savings back into expansion. He opened a new branch of his store in an electronics mall and eventually added five more there.

Video games weren’t the only thing moving out of GP, though. Kim noticed that customers were also keen on nylon and polyester shoulder bags to protect their precious PlayStation and Nintendo gaming consoles. So in 2003, Kim made the first of what would be many trips to China, where the carriers were made, to secure a network of suppliers. GP’s game and accessories business grew to generate, at its peak, as much as 50 billion won in annual sales.

Kim picked up more than bags in China. He learned Chinese and, he says, “a lot about the Chinese culture and the habits of people.” Kim was quick to spot the resurgent popularity of Korean pop culture in China, part of a second K-Pop wave like the one that swept Asia in the 1990s, but now supercharged by the rise of social media.

With the new craze for Korean bands and TV dramas came a yearning to emulate the fair and dewy skin of their stars: the K-Beauty trend. Korea’s biggest beauty brands had been exporting to China for years; now even smaller brands could sell to Chinese consumers online or to the rapidly rising number of Chinese visiting Korea. The second wave gave Kim the chance to make use of his China connections, and in 2013 GP became the distributor for Korean brands still trying to ride the K-Beauty wave into China’s market.

“It did incredibly well – at first,” Kim recalls. But his role as middleman was precarious: As his Korean clients’ sales soared, they began cutting him out and selling directly to China’s retailers. Turning to a small Korean cosmetics factory in April 2016, Kim launched his own brand of body washes and lotions, JM Solution, which stands for “Journey to Miracle.”

JM’s first product line was gaining popularity, but its rise was cut short when, in the summer of 2016, Korea agreed to deploy the U.S. THAAD anti-missile system on its turf, designed to protect it from North Korean missiles. Beijing, worried the system’s radar could penetrate Chinese territory, interpreted the development as a national security threat and retaliated swiftly by banning Chinese group tours to Korea. “Before the crisis, 800,000 Chinese were coming to South Korea every month,” says Park Hyun-jin, an analyst at the DB Financial Investment brokerage in Seoul. “It fell to about a quarter of that.”

State media also urged China’s consumers to boycott Korean products. Sales at Korea’s largest cosmetics firm, Amorepacific, dropped by more than 9% during the two-year boycott. Its net income tumbled by more than half. “The appetite for K-Beauty was big,” says Lee Sun-hwa, an analyst with Eugene Investments and Securities in Seoul. “But with the tourism ban, there were fewer channels for Chinese consumers to purchase these products directly.”

GP wasn’t spared. “I lost a billion won I couldn’t get back from one retail partner. We had orders of three billion won being cancelled,” Kim says. “People were literally telling me, ‘Stop producing.’” He didn’t. Instead, Kim invested all his money at the time – 1.5 billion won – into a new product: facial sheet masks. Unlike traditional facial masks that are brushed on as a paste and then allowed to dry before being peeled or washed off, facial sheet masks are tissue-thin sheets cut to fit the face – with holes for the eyes and mouth – and coated with chemicals designed to moisturize and rejuvenate the skin. China’s consumers buy $15 billion in these masks every year, according to Bain & Co.

In mid-2017, GP launched JM Solution’s Honey Luminous Royal Propolis Mask. Other masks soon followed, including the Active Bird’s Nest Moisture Mask, the Active Jellyfish Vital Mask and, of course, the Active Pink Snail Brightening Mask (containing real snail extract), just to name a few. GP didn’t advertise. Instead, it sent masks to China’s top beauty influencers, who would in turn post reviews – for free – on Sina Weibo (China’s equivalent of Twitter) or on TikTok, the short-video platform operated by Bytedance.

Some influencers began buying masks in bulk and reselling them online. But it was the daigous who arguably made a significant difference. Daigous aren’t limited to GP’s masks or to Korea, but the THAAD boycott and the popularity of GP’s influencers in China spawned a lucrative gray market for the daigous to exploit, buying masks in bulk in Korea and selling them to buyers at home who put complexion ahead of patriotism.

GP’s allure to the daigous was also fed to some extent by its own competitor: Amorepacific limited how much of its products any single customer could buy. A spokesperson for Amorepacific says the company was more concerned with protecting and promoting its long-term brand image than with boosting short-term sales.

GP had virtually no limits. By the end of 2018, GP had sold 800 million masks, a number that has now surpassed a billion. “Tourism was declining,” says Eugene analyst Lee. “But sales of JM products at duty-free stores were rising. It was people who were selling them, not consuming them.” Today, GP, the company that started out selling video games and accessories, counts on cosmetics – largely to China – for 90% of its sales, half of which now come from e-commerce platforms such as Alibaba’s Tmall. Games and related accessories account for just 6%.

GP Club’s China-powered rise was so meteoric that analysts initially projected the company could be valued as high as 10 trillion won in an IPO. They’ve since brought that estimate Earthward – current projections are for a valuation of roughly 4 trillion won. “The 2018 financials, while impressive, were still less than what we thought they’d be,” Lee says.

“JM Solution products have had a meteoric rise for sure, but GP Club, even when dealing solely with video games, was clearly successful,” says Jane Han, GP’s general sales director and its first cosmetics hire, in 2014. “What has not changed is our CEO’s passion and sincerity for what he does and his meticulous focus on fully understanding all the details involved in bringing a product to market and selling it. That is one of his greatest strengths.”

As proof that it is no longer an upstart in China, GP now must grapple with the bane of so many brands there: counterfeiting. “Fake products are already in the Chinese market,” says Florence Bernardin of Information & Inspiration, a research firm specializing in the Asian cosmetics market. Fake cosmetics not only undercut sales; sometimes tainted with dangerous chemicals, they can hurt unwitting consumers and spark a backlash against the genuine brand. China’s social media is rife with complaints about counterfeit Korean cosmetics. GP says it’s working to foil counterfeiters by monitoring online and offline sales channels, updating its packaging and working closely with its online partners such as Alibaba.

Vigilance may curb copycats, but continued growth, analysts say, will depend largely on diversification into new products and markets. GP has expanded offices from Seoul into Guangzhou, Hangzhou, Hong Kong, Tokyo and Weihai in China’s Shandong province. Roughly a quarter of its 170 employees are focused on R&D, it says, and it’s now selling its cosmetics not only in China but also in Japan, Malaysia, Singapore, Thailand and back home in South Korea. “The next big market for cosmetic firms appears to be Southeast Asia,” says Shinyoung Securities analyst Shin Su-yeon in Seoul. “K-Beauty is popular in the region. But it’s a difficult market, fragmented between several countries.”

Kim hopes an IPO will give GP the cash it needs to bridge those divides. When all is said and done, though, success is a relative matter for Kim, who feels his father died prematurely: “My dream is to be able to spend the better part of my life comfortably with my family.” – With additional reporting by Yue Wang

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08/19/2019 Fortunes Of Five Lauder Family Members Rise A Combined $3.1 Billion Following Strong Estee Lauder Earnings Report

Annabelle Woodward is a rising senior at Brown University, where she serves as the Arts and Culture editor for The Brown Daily Herald. She has previously written for The Shelter Island Reporter and The Suffolk Times.

Five members of the family behind global beauty behemoth Estee Lauder Companies are a combined $3.1 billion richer since Friday after the stock jumped more than 12% Monday following strong earnings for the fourth quarter and the company’s fiscal 2019. Leonard, Ron, Aerin, Jane and William Lauder – all billionaires – - are the children or grandchildren of founder Estee Lauder, who launched the company with her husband Joseph in 1946. Leonard Lauder’s net worth rose by $1.8 billion on Monday, making him the second biggest gainer of the day, behind luxury goods baron Bernard Arnault, who was up $2.2 billion.

It’s been a banner year so far for Estee Lauder stock, which has risen by 55%. The five billionaire Lauders are together worth an estimated $32.4 billion, up 24% since early March, when Forbes’ 2019 World Billionaires list was published.

The New York-based cosmetics company behind brands like MAC Cosmetics and Bobbi Brown reported that net earnings rose to $1.79 billion in the year through June 30, 2019, up a whopping 61% from $1.11 billion the previous year. Net sales climbed 9% to nearly $14.9 billion, and diluted net earnings per common share increased to $4.82 compared with the $2.95 reported in fiscal 2018.

Fabrizio Freda, Estee Lauder’s President and CEO, attributed the company’s eye-popping gains to improved data analytics, which helped drive better digital marketing.

All five Lauder family members are either board members or executives at the company and help oversee its more than 25 brands. William, 59, is the chairman of the company; he served as CEO from 2004 to 2009. Aerin, 49, the eldest daughter of Ronald and the style and image director at Estee Lauder, founded her own luxury lifestyle brand, AERIN Cosmetics, in 2012. Now a mainstay under the Estee Lauder umbrella, AERIN offers everything from “rose lip conditioner” to light fixtures and is sold in 40 countries.

Estee Lauder CEO Freda expressed optimism about the company’s capacity to perform in fiscal 2020, stressing that he plans to continue investing in emerging markets beyond China. Estee Lauder is already doing business in over 150 countries and territories.

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08/19/2019 Revlon's Cautionary Tale: The Changing Nature Of Influencer Marketing

Cosmetic giant Revlon is exploring the sale of all or some of its business amid lackluster sales and a crushing debt of $3 billion. The iconic company’s 2016 acquisition of brand Elizabeth Arden apparently isn’t rescuing it from the Sephoras and direct-to-consumer businesses (DTCs) of the world. Revlon’s tale is cautionary for leaders in all industries: Don’t rest on your laurels (or, in this case, your lashes).

A Pioneer In Influencer Marketing

An R&D innovator that saw its first successes with revamped nail polish formulas, Revlon also revolutionized cosmetic marketing when it hired famed Richard Avedon to photograph first brand ambassador Lauren Hutton in 1973. In the ’80s, Revlon then pioneered a new era of influencer by stoking the phenomenon of the “supermodel,” making the mass-adored faces of Iman and Cindy Crawford inseparable from the Revlon brand. These instantly recognizable supermodels had their aura only enhanced by Revlon’s incredibly sized contracts. Revlon mastered riding the culturally relevant for its own marketing purposes.

A New Era Of Influencer Marketing Takes Revlon By Surprise

That MO worked for years, making it ironic that the company was slow to recognize and adapt to the next influencer era – one defined by self-made experts who build followings (and brand relationships) on social foundations. This era made Kylie Jenner a billionaire in three years. Revlon trialed influencer campaigns relatively recently. Late to the game means late to insights and optimizations. And Revlon’s size and complexity certainly don’t help it adapt quickly to what it’s hearing from fans and influencers the way DTC cult brand Glossier does when it pivots product and packaging based on community feedback. The influencer game changed, but Revlon did not change with it fast enough.

Change Continues, Making Adaptability And Agility Keys To Success

Even as you read this, influencer marketing is changing again. Our latest researchshows that leading brands are skipping big-reach influencers for those with smaller followings but more authenticity. Some even have no followers. Some are not even human, like Lil Miquela. Brands use influencer marketing systems to find, vet, contract, use, amplify, and monitor pools of influencers for marketing purposes across the whole customer lifecycle.

Revlon’s situation is complex, and the company’s slower adoption of modern influencer marketing tactics is likely one of many challenges contributing to its current struggles. But its influencer strategy signals a failure to keep pace with consumers, to recognize new trends, to change existing processes.

The lesson learned: While remaining unchanged works for Cindy Crawford, it does not for business – adaptability and agility do.

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08/19/2019 Estee Lauder: blemish free

The US bond market may have started to exhibit age spots. Global economic growth looks tired. But try telling that to Asia’s legion of skincare devotees.

The region’s seemingly insatiable demand for pricey toners, face masks and creams has plumped up Estee Lauder’s latest results. The 9 per cent rise in sales and an adjusted profit gain of 5 per cent in the fourth quarter both topped expectations. Guidance for the current fiscal year was also well above consensus. Full-year operating margins climbed for the fourth year running to a record 17.6 per cent.

Cosmetics can be a recession-proof business. While consumers may put off big-ticket purchases during a downturn, they will still treat themselves to a $25 lipstick, or even $350 face creams. The rise of social media is likely to reinforce this trend. The proliferation of YouTube tutorials has made using make-up more accessible.

But not all beauty companies are created equal. While Estée Lauder and French rival L’Oréal have the financial muscle to develop new products, build digital strategies and fund acquisitions, others have struggled. Revlon, a mass-market staple, is putting itself up for sale. Coty has taken a near $4bn writedown so far this year on its $12.5bn acquisition of Procter & Gamble’s beauty brands from three years ago.

Estee Lauder benefits from having a diversified product portfolio and a balanced geographical exposure. This has not gone unnoticed. The stock jumped more than 9 per cent on Monday to a new record high, extending year-to-date gain to more than 50 per cent.

At 31 times forward earnings, Estee Lauder shares look expensive. The wider S&P consumer staples index is trading at around 20 times. A bet on Estee Lauder now is a bet that the growth momentum can continue. Estee Lauder said its forecast has already factored in risks from Brexit, trade tensions and the Hong Kong protests. This, plus a record of providing conservative outlooks, suggest its shares can retain their sheen.

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08/19/2019 Investing In Beauty And Personal Care

Founder and CEO of BlackCrown Inc., the independent sponsor firm targeting value buyouts in select industries.

Independent beauty brands have taken the market by storm. Armed with greater awareness of what “goes into” their daily beauty products, people now gravitate toward brands with premium product features and have a genuine thirst for brand exploration (getting to know the authenticity) primarily because smartphones have transformed customers into independent-thinking consumers.

How do investors and brands navigate this information age? How do consumer brands stay meaningful in an era where information consumption is highly fragmented and brand equity can be watered down through the smartphone and social media experience?

Back To The Future

Proctor and Gamble (P&G) paid $1.2 billion for Richardson-Vicks Inc. (RVI) in October 1985. In that era, RVI encompassed various brands, including Vicks and NyQuil, but also personal care products such as Oil of Olay, Clearasil, Pantene and Vidal Sassoon. This acquisition gave P&G the necessary assets to enter the beauty market and become a mass-market provider of beauty brands. A critical takeaway here is how everyday consumers benefited from having mass-market access to quality brands and seemingly key beauty products. During this era, consumers were just discovering personal choice, understanding personal beauty and receiving brand messaging from a single voice (their local retailer). There was no way for individuals to discover their own facts and build their own analysis. P&G and other conglomerate brands truly dominated this consumer era.

P&G changed our lives and disrupted the world with their two-in-one shampoo technology; today we likely take this convenience for granted. The first brand to receive this disruptive technology was Pert Plus. At the time, Pert was a weak brand, but P&G revitalized that brand equity (with Pert Plus), which consequently inspired the firm to re-innovate Pantene.

Pantene was inherited from the RVI acquisition; enhancing the brand with 2-in-1 capabilities helped P&G really understand how to sell beauty and wellness. In 1992 P&G introduced Pantene Pro-V, which quickly became one of the fastest-selling hair care products and repositioned the asset as a true personal care product.

P&G understood that innovations at scale compounded with brand equity yielded tremendous returns. Consumers directly benefited from these disruptive innovations in beauty and personal care; P&G understood the customer and crafted new end-user experiences. Still, up to this era, the point of purchase and information awareness largely remained with mass retailers, an exclusive in-store experience. While Motorola was the first company to produce a mobile handheld device in 1973, dial-up internet wasn’t commercialized until 1992. Brands were still entrenched in telling the customer what to do.

Getting To Today: Beauty And Brands

The internet has largely democratized the information of beauty and wellness to create the independent consumer. Beauty hasn’t changed. Rather, the medium of interactions has been liberated from in-store experiences. Historically, established consumer brands were largely limited to specific advertising mediums (think radio and television). Awareness of product benefits and consumer insights was narrow and truly limited; consumers weren’t really given the platform for independent thinking.

Today, mobile devices are the status quo and the points of sale. The “store” is in our pockets, and according to a recent report by the World Advertising Research Center (paywall), it’s estimated that nearly three-quarters of the world will access the internet via smartphones by 2025. Since the internet era, have legacy brands innovated customer experience? Have they wholly adapted their product innovations and premium features toward the modern habits of consumers in the 21 century? No. Brands must move away from retail mindsets established in the late 1800s to compete at various points of sale experiences (digital to physical).

Established brands have had muted success in adapting to the modern era. In order to innovate and stay relevant, established brands pay for independent brands, often at substantial premiums: L’Occitane acquired Elemis for $900 million. Clorox acquired Nutranext for $700 million. L’Oreal acquired IT Cosmetics for $1.2 billion. And Estee Lauder acquired Too Faced for $1.45 billion

These decisions and strategic moves admit defeat for organic growth and organic strategies. Unfortunately, bringing in external brands, in the long run, might hold higher odds of failure because internal management systems never had the ability to “get it right” in the first place. This may be too critical, but it is a candid assessment regarding brand integration risks and “buying to be relevant” plays.

Welcoming The ‘Indie-Mass’ Market

P&G acquired Noxell in 1989 for $1.3 billion and then, in 1991, acquired Max Factor for $1.14 billion. Respectively, both of these acquisitions created much of present-day Coty. I believe P&G’s decision to exit the entire mass market of beauty confirms that the midmarket beauty market is now the “independent beauty brand.” Personally, I think this channel should be called the “indie-mass” market. I define indie-mass as the new midmarket beauty category where seemingly independent brands are perceived as premium, authentic, personalized and available through mass appeal.

For Coty, I believe they’ve recognized this indie-mass market by writing down $3 billion worth of assets they acquired from P&G and their recent announcement to invest in Kylie Cosmetics. Looking at historical trends, the deal likely undervalues the contribution that Kylie Cosmetics would bring to Coty. However, I think that Kylie Cosmetics may be worth closer to $3 billion – Kylie Cosmetics has much more runway and brand equity. For brands like Kylie Cosmetics, there are better ways to build value with Coty that likely go unexplored.

Key Questions For Investors And Private Equity Firms

When it comes down to it, how can investors and private equity owners analyze these midmarket brands? How far can these brands go, and what are the support systems in place to get them there? Here are some questions to determine if a brand stands up to the test:

  1. How is the brand managing digital to physical?

  2. How elastic is the brand? Can it deliver value through various products and demographics?

  3. Has the beauty and wellness brand kept up with the customers’ purchasing and self-discovery behaviors?

Overall, investors and private equity firms ought to consider a total strategy when truly assessing consumer brands.

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08/19/2019 ESTEE LAUDER dévoile des perspectives de toute beauté pour son exercice en cours

(AOF) - Estée Lauder a publié lundi des résultats supérieurs aux attentes au titre de son quatrième trimestre fiscal 2019 (clos fin juin) et dévoilé des perspectives enthousiasmantes pour l’ensemble de son exercice en cours. Ainsi, le spécialiste américain des produits pour la peau et des cosmétiques a publié un bénéfice net de 157 millions de dollars au quatrième trimestre, ou 43 cents par action, contre un bénéfice net de 186 millions de dollars, ou 43 cents par action, un an plus tôt. En données ajustées, le bénéfice par action ressort à 64 cents, dépassant le consensus FactSet (53 cents).

Pour sa part, le chiffre d’affaires d’Estée Lauder s’est établi à 3,59 milliards de dollars au quatrième trimestre, en hausse de 9% sur un an. Cette performance est également au-dessus des prévisions moyennes du marché (3,53 milliards).

Estée Lauder a aussi réjoui les investisseurs du côté de ses perspectives. Pour son premier trimestre fiscal 2020, le groupe vise une croissance de ses ventes de 9 à 10% (consensus : +6,5%). Enfin, pour l’ensemble de son exercice fiscal 2020, la société table sur une croissance de ses ventes de 7 à 8% (consensus : +6,4%).

Les spécialistes du secteur sont très confiants en constatant la très forte demande de la clientèle chinoise. Morgan Stanley estime que le marché chinois, qui a procuré à l’industrie du luxe 60% de sa croissance sur les quinze dernières années, devrait augmenter ses dépenses de 90% d’ici à 2025. Même optimisme du côté du cabinet de conseil Bain & Company. Parmi les facteurs de croissance se trouvent l’expansion rapide de la classe moyenne, qui devrait représenter les deux tiers des ménages chinois d’ici 2027 et la demande toujours soutenue des Millennials, particulièrement sensibles aux tendances innovantes telles que la convergence de la mode et du sport.

Une étude du Boston Consulting Group estime que, d’ici à 2024, les consommateurs chinois représenteront 40% des clients du luxe. Leur contribution à la croissance de ce marché est estimée à 70% pour les cinq prochaines années.

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08/19/2019 Five Tips For Collaborating With Other Brands

Award-winning esthetician and Founder of StackedSkincare, a high-performance skincare line of pro-grade serums, peels, and tools.

They say business is a dog-eat-dog world, but in actuality, there are endless opportunities to collaborate and cooperate with other brands in order to diversify your audience and reach new customers. Here are a few tips for negotiating and executing successful partnerships with other brands in your industry and beyond.

  1. Don’t Compete With Yourself – Unless It’s Worth It

When it comes to selecting brand partners, your instincts will probably tell you to look outside your industry so you aren’t in direct competition with your collaborator. While that instinct is a good one, it can prevent you from thinking creatively about how to structure partnerships. Working with brands inside your industry can mean reaching an audience that’s already primed to engage with your brand.

It might be worth working with a brand in your industry as long as your product assortments complement rather than compete with one another. A good example for my skincare brand would be partnering with a brand that specializes in color cosmetics like foundation, blush, etc. While we both occupy the beauty space, our products don’t overlap, and both of our audiences are interested in the other brand’s products.

Retailers make some of the best brand collaborators because they are already invested in your success. Before you approach your retailer about a collaboration, consider what you’re willing to offer them. Some of the best offers you can pitch are exclusive product launches, exclusive packaging or a special sale price – all things that give them an edge over their competitors. In exchange, you should ask for a dedicated promotional strategy around the launch: placements in emails, social media or in-store features. The sweeter the exclusive, the more you can ask for in return. Be prepared to negotiate terms like the dates of exclusivity, which will help you bargain for more promotion.

  1. Consider This: What Else Is Your Customer Buying?

Unless you’re partnering with a retailer, the end goal of most collaborations is to gain new customers, so pick a partner whose customers are lookalikes of yours. Think big about your customers: What else are they buying other than your products? Do they have lots of disposable income, or are they on a budget? If they’re interested in your products, what other industries do you think they’re interested in? If you’re stuck, look at lifestyle trends related to your category. For example, if you’re selling beauty products, you can probably infer that your customers are also interested in wellness. A huge part of wellness revolves around fitness. Consider partnering with an athleisure apparel company; people buying expensive athleisure apparel are likely to also purchase luxury skincare. There’s a lot of potential in collaborations. It’s only limited to your imagination, your marketing prowess and your ability to execute.

  1. Build Social Currency With Giveaways

Co-branded social media giveaways are one of the most ubiquitous and approachable ways to dip your toe into collaborations. While they don’t always convert to sales, they are a strong tool for raising brand awareness. Giveaways are a great way to gain followers and email sign-ups, but they can also increase your social currency if you choose the right partners. Look for brands that are getting lots of PR buzz, have impressive social media engagement or are otherwise making waves in their industry. By positioning yourself with these brands, you gain from their success, and their brand advocates might even become your brand advocates. Instagram is still the best way to get in touch with other brands, so don’t be afraid to send a DM to get the conversation started.

  1. What To Avoid
  • Gift Bags: Gift bags are a waste of product and money. You’ll probably never see a sale as a result.

  • Email Swapping: Avoid any collaborators that claim they’ll share their email list with you. It’s illegal. The only legal way to get email sign-ups is through customer opt-in.

  • Working Without a Contract: If there’s money involved or you’re giving a retailer exclusivity, you need a contract. If you’re just contributing product for a giveaway or social campaign, you can choose to take the risk and do it on a handshake.

When it comes to collaborating with other brands, allow yourself to think creatively. Many times, collaborations are a great way to build your brand without shelling out a lot of money or product. Think about your goals, and initiate the partnerships that can make them happen.

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