BW Confidential - Issue #2 - May/June 2010 - (Page 7)

News recap BDF refocuses Germany-based Beiersdorf (BDF) is to put an increased focus on skincare and create a closer connection to regional markets to boost growth, and has reorganized its executive board to implement the strategy. The board will now consist of three regional and three functional areas of responsibility. Board member Pieter Nota will continue to be responsible for marketing and innovation, Bernhard Düttmann remains in charge of finance and will also take on human resources. Markus Pinger will take responsibility for the Americas region, James Wei will head up Asia and a new board member will be named for Europe. Thomas Quaas (pictured) will remain board chairman. Quaas said that 50% of the expected growth in the global cosmetics market will occur in the skincare category, which provides an opportunity for BDF given its strong Nivea brand. BDF said it has expanded its global market share from just under 4% in 2004 to 5% in 2009. Update Beauty’s new deals There has been a series of small acquisitions in beauty over the past month—the type of bolton deals that analysts had predicted for this year. More deals like this may follow, especially in the skincare and naturals sectors. • Avon Products acquired UK-based skincare company Liz Earle Beauty Co. The 15-year old British company sells the Liz Earle Naturally Active Skincare line mainly in direct-to-consumer channels (mail order, QVC, but also retail stores, such as John Lewis). The brand will be managed as an independent stand-alone company under its co-founders, and is expected to benefit from Avon’s international reach. • Personal-care group Helen of Troy purchased the Pert Plus haircare and Sure deodorant businesses from US-based Innovative Brands. The two brands are expected to generate $65m in annual sales, and Helen of Troy said it will continue similar acquisitions. • It was more of a rescue than real M&A activity, but German beauty company Fribad Cosmetics Group also changed hands. The company, which filed for bankruptcy in April 2009, was bailed out by new investors: Baden-Baden Cosmetics Group first took a 100% stake in Fribad, which markets spa brand Biodroga and retail skincare line Sans Soucis. This was followed by investment company Heliad Equity Partners acquiring a 40% share in the company; Heliad’s operating partner FCP Frankfurt CapitalPartners holds a 60% interest. Sans Soucis and Biodroga together do annual sales of €25m. Heliad hopes to consolidate the two brands in Germany and open new markets. credit: stock.xchng In brief Elizabeth Arden signed a fragrance licensing deal with US handbag brand Kate Spade. The group will launch its first fragrance for the brand this fall. Kate Spade had signed a fragrance license with the Estée Lauder Companies in 1999. French brand L’Occitane is expected to list on the Hong Kong stock exchange in May, according to press reports. The company hopes to raise between $300m$600m from the IPO to finance development in Asia. The region is the company’s strongest market, with the brand doing almost half of its estimated €537m sales there. The company had planned a stock market entry in 2008, which was delayed due to the financial crisis. Shu Uemura pulls out of US French group L’Oréal is pulling its Shu Uemura brand from the US market to focus on developing its larger, strategic brands, including Lancôme, Ralph Lauren, Kiehl’s, Yves Saint Laurent and Giorgio Armani. Shu Uemura, whose offer includes make-up, skincare and haircare, was acquired by L’Oréal in 2000. The brand entered the US in 2004 and currently has 100 points-of-sale and four standalone stores in the country. Shu Uemura will continue to be sold on its website in the US. The brand is sold in 18 countries worldwide. May-June 2010 - N°2 - BW Confidential 7

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