BW Confidential - Issue #2 - May/June 2010 - (Page 14)

Best of Beauty BW highlights An extract of interviews, market reports and industry analysis from BW Confidential’s electronic publication TV shopping Beauty devices show strong sales on home shopping networks, as do skincare and trendy, make-up brands. However, industry players also see a strong potential for fragrance, even though a presenter cannot demonstrate a brand’s scent. “Fragrance will grow. When Calvin Klein first launched Obsession, Eternity and Escape, it was essentially an image business, rather than just about the scent,” says HSN senior vp of beauty Michael Henry. Web sales Content on retailing sites can help the consumer sort through masses of product. This can be entertaining, for example in a magazine-like or editorial format, blog or video or online TV. Customer reviews have been late to make it to beauty retailers’ radar, but the effect on sales is impressive. “There is a lot of skepticism around marketing and claims, but credible statements from consumers help overcome this. These reviews boost conversion rates by around 25 to 30%,” says Bazaarvoice director international sales Kamal Kirpalani. Men’s fragrance Classic brands continue to hold their own in men’s fragrance, but it isn’t just the economy that makes classic fragrances a “safe” purchase; retail also plays its part. Perfumeries and department stores have done little to cultivate the male shopper and broaden his fragrance palette beyond the merchandising display for the latest launch. “In retail men are even more lost than women so they don’t take risks and go back to the classics instead. This means the market remains quite static,” remarks JMG Research md Jérôme Goldberg. Boosting retail traffic Retailers are divided on what needs to be done to increase instore traffic. For Studio BeautyMix at Fred Segal ceo Nicole Ostoya the key is to offer an original assortment. “We are always looking for special, unique and hard-to-find items, For example, we are mixing retro candy with key products from our hard-to-find items and putting them in candy jars.” Wellness & spas Spa memberships It’s a wonder that more spas don’t offer membership. A well-managed program means clients visit more regularly, which makes tracking consumption patterns easier. The treatments she books most frequently, how often and what she buys and her average spend per purchase can all be analyzed and the spa manager can better market treatments that are not included in memberships. Hotel spas Hotel spa managers need to define which strategies are working and which are not; but if hotel and spa financial reporting are rolled into one, there is little visibility. For starters, a hotel spa should have a separate profit and loss statement and operational report to measure spa performance, such as best-selling treatments, payroll analysis, and the results of marketing initiatives. Spa consultants Has spa consulting become a free-for-all? The number of selfprofessed, and not necessarily experienced spa consultants has mushroomed along with growth in the spa industry. “Consultants have gotten owners to spend millions of dollars on spas that will never make money. This trend will hurt the industry for many years to come,” bemoans one spa manager. Consultants with solid industry experience are facing an increasingly crowded marketplace, but the recession may weed out less experienced players. In-room treatments While most hotel spas make a portion of their treatment menu available to guests in the privacy of their room, taking the treatment out of spa can cut down on the overall experience. Many spas also limit the in-room offer due to the complications of providing services without the requisite material on-hand. Doing more to create a spa-like environment in the room can reap benefits. 14 May-June 2010 - N°2 - BW Confidential

Table of Contents for the Digital Edition of BW Confidential - Issue #2 - May/June 2010

- Brand and retail news recap
Take note
- Market facts, figures and trends
The latest fragrance, skincare and make-up launches
Best of BW
- Market highlights
- Clarins Fragrance Group president Joël Palix
Insight : skincare
- Category overview
- Industry viewpoint
- Trends
- Training in spas
- Spa case studies
Market watch : Asia
- Regional analysis
- Japan
- China
- South Korea
Focus : Fragrance creation
- Fragrance regulations
- Perfumer roundtable
- Six up-and-coming beauty brands
Travel retail
- Asia regional roundup
- Interview with Korea duty-free
Last word
- Morning Star equity analyst Erin Swanson on beauty’s threats and opportunities

BW Confidential - Issue #2 - May/June 2010