Future Beauty - Sound proofing

This year’s Marketing Week’s Future Beauty & Body Visions conference sought to explore the various means that manufacturers can use to break through market place noise and create that must-have buzz. Georgina Caldwell reports.

Broadly speaking, the Future Beauty and Body Visions conference explored three main ways of breaking through the sound barrier – filtering out rival brands clamouring for attention to stand out to the consumer. These three themes included investing true innovation and passion in a product or brand, a creative use of media budgets and creating an effective method of communicating with the consumer in-store.

Steve Dworman, founder of US skin care company NuGlow, opened with a description of the infomercial as a sales tool and how he used it to launch his latest cosmeceutical line. Using direct mailing to reach customers and sending out a promotional DVD featuring actress Nicolette Sheridan, Dworman has built up a loyal customer base. Dworman explains that the power of celebrity should not be underestimated and is an important marketing tool. NuGlow was fortunate to sign Sheridan prior to her Desperate Housewives success, demonstrating that securing a high profile celebrity spokesperson is not an unrealistic prospect in terms of budget.

Yolanda and Rodger Halston, co-founders of Classified Cosmetics, agreed wholeheartedly with the importance of celebrity as a sales tool – claiming that if your product falls into the hands of an A list celebrity the impact is worldwide. The company sends samples of its products to be included in gift baskets at major Hollywood events to maximise the chances of association.

The couple were keen to point out the importance of true innovation but stressed that when a product breaks all convention, the in-store experience must be well managed to secure sales. With ERA Spray-on Makeup the Halstons had to encourage trial through in-store demonstrations and maintain that touching the customer is key to ensuring that your product has impact.

This celebrity endorsement is all-pervasive in cosmetics at present, and no more so than in the world of fragrances. John Ayres, chairman of the Fragrance Foundation UK and director of Pandora, gave a fascinating insight into the development of the fragrance industry in the last decade. As Ayres recognises: "In the last five years the proportion of major brand launches has decreased in favour of a proliferation of celebrity scents."

However, developments from the major fragrance houses have revealed some interesting trends in the last five years. The new millennium saw the development of aromachology concepts as well as the first signs of a new sensuality in fragrance – a stark contrast to the florals and ozonic, aquatic notes that dominated the previous decade.

This sensuality was developed further in 2002 with the use of amber and musk in fragrances such as Dior Addict and McQueen Kingdom. The biggest celebrity fragrance was also unveiled at this time, with Coty’s JLo Glow taking $31m in the first three months on sale and entering the top 20 in just six months.

However, the last year has seen some true innovation in fragrance launches, says Ayres. And, although the proliferation of celebrity fragrances and limited editions and flankers is still dominating the market, there has been some really interesting creative directions in the main brand arena. The use of technology to capture new notes – for example the effect of green apple utilised by DKNY in Be Delicious – is encouraging. The influence of niche and super prestige brands is also important as these fragrance houses are helping to educate the consumer and are thus inspiring more mainstream brands to invest in creativity.

According to Ayres it is this creativity and education that are key to the future of the fragrance market. Consumers need to be educated about buying perfume in the same way that they choose wine. In this way truly innnovative fragrance products will be appreciated, in turn spurring manufacturers to become more creative. This is already starting to happen, reports Ayres, who has been encouraged by a number of innovative measures by niche brands and major fragrance houses alike.

One such way of involving customers was demonstrated by Linda Pilkington, owner of Mayfair perfumery Ormonde Jayne. Pilkington creates her own perfumes and scented candles from notes she sources on her extensive travels and keeps her customers involved in the creative process by sending descriptive e-mail newsletters describing her adventures. This kind of history not only demonstrates the dedication and passion that Pilkington devotes to the creative process but also helps to build enthusiasm for a product that is both intrinsically personal and individual.

Spiezia Organics also uses passion to drive its sales. Spiezia has created a range of 100% organic products and Amanda Barlow, board director, claims that the brand has achieved recognition for daring to be different by developing at a steady pace and founding the company on core values of honesty and integrity.

Education plays an important role in Spiezia’s marketing strategy and the company sends out newsletters and encourages internet shopping as a means of helping the consumer to make informed purchasing decisions in a neutral environment.

Curiously famous

However, with the international launch of Britney Spears’ first fragrance, Curious, this year, it is clear that the celebrity vibe is far from dead. Nina Lund, marketing director for fragrance at Elizabeth Arden, was on hand to explain how the company created the buzz that propelled Curious to number one in three countries and exceeded expectations in virtually every market.

Lund was keen to establish that, although Arden enjoys the reputation and recognition of a multinational company, in terms of budget the company is firmly middle-sized and it was important to work within a limited budget throughout the international roll-out of the scent.

Intrinsic to Arden’s strategy was understanding its consumer target so that the money it spent on promotional activities and media spots reached the relevant audience. With neither the time nor the resources to conduct any formalised research or focus groups, employees interrogated unsuspecting relatives and friends about their likes and dislikes. Arden also asked MTV for its insights about this generation.

Arden then circulated a posed picture of Spears which was picked up by several magazines and even used as a cover image for some publications. As a next step the company head-sponsored an alcohol-free club night for teens in Australia, which was aired twice on national television.

Arden also used some very effective multi-media advertising and marketing campaigns. By buying spots on popular websites, Arden created a space where viewers could enter their mobile number and then receive a voice message and text reminder from Britney about the fragrance. In the outdoor arena the company toured with a branded Curious bus to draw attention to the brand, handed out magnets printed with the web address in Rome and furnished its poster campaign with sound bites and sampling opportunities.

The provocative television commercial was also a great success, Lund said, and the BACC ban imposed on showing the advertisement before the watershed on British television generated an aura of mystery and intrigue around the fragrance and a vast amount of editorial coverage. In addition Arden streamed it over the internet to increase the number of hits.

It is this type of creative media coverage that Jenny Cossons, director of fashion and beauty advertising at Condé Nast Interactive, encouraged while showcasing the online medium of Condé Nast’s print magazines. As Cossons pointed out, one of the advantages of online advertising is that the impact is trackable. Companies can trace the number of hits to the site and tailor their advertisements to capture data or direct customers in-store by providing an exclusive online offer or competition. For example when cult cosmetics brand Pout touted a Christmas shopping event online it sold 180 tickets in a day and received 160,000 hits on two sites. For special launches companies can also invest in temporary co-branded sites, which are tailored to promoting particular product lines, such as P&G’s Lacoste Touch of Pink site.

Website activity can also be used to create a bond with consumers in a way that print advertising rarely achieves because advertisers can create an interactive game or quiz, even using the medium as a diagnostic tool for skin types or beauty fixes. Many advertisers opt for an advertorial style format offering advice on grooming or fashion and issuing sampling invitations.

Karim Gangli, managing director of Incos, the owner of the So...? cosmetics brand, agreed that media spend should be directional, appropriate to the target market and as creative as possible.

So...? states that its goal is to engage and create a bond with its consumers. To do this the company strives to know its consumer base and understand their opinions and taste. For this it makes use of focus groups to ensure that its products and marketing appeal to its target market.

Gangli pointed to the fact that mass brands made up just 7% of total media spend for women’s fragrances in 2004 to demonstrate that spending below the line was crucial in generating awareness on limited resources.

Of the £43.7m total media spend by prestige labels in 2004, 37% was in TV, 51.6% in press advertising and 8% on outdoor campaigns. In contrast 98.7% of the total expenditure from mass brands (£3.1m) was spent on press.

Gangli explained that the fragrance brand So…? maintains a strong focus on public relations, sampling and interactive media, such as online competitions and games, as this is an effective way to create a bond with its consumer base.

The company also places importance on in-store theatricals to influence consumers at the point of purchase, working with retailers to install more eyecatching graphics on signage and promotional shelving, as well as handing out leaflets in-store detailing competitions or promotions.

Shop till you drop

Helen Miller, commercial director, cosmetics and fragrance at UK health and beauty retailer Boots, demonstrated how Boots is developing its in-store experience and managing mass and prestige brands under one roof. Using its Advantage Card data and in-store diagnostics Boots has come up with a profile of customers which can help brands understand, how, when and what consumers buy and, even more importantly, why.

According to Miller, shopping is a four stage process. First, customers acclimatise themselves to the store, adjusting to the lighting and heating and locating a basket. Then they engage in reconnaissance to pinpoint the relevant aisle. The third step is termed Macro – when customers scan the fixtures in broad focus. Specific engagement with the products, also known as Micro, is the fourth and final stage. Miller said that prestige shoppers tend to move from fixture to fixture, "island hopping," whereas mass market customers prefer to use linear scanning methods.

In order to maximise the experience for both types of consumers Boots has adjusted the fixtures to make them easier to browse. In the mass aisles the fixtures have been raised by nine inches and installed with front lighting to reduce shadow. Boots has also created more space for branding and side banners to help brands better stand out.

In its prestige areas Boots is creating a less intimidating environment by attaching self selection units to the traditional counters. In larger stores Boots is also helping mass brands to differentiate their offering from the competition by creating self selection islands. These shelving options help to blur the boundaries between mass and prestige and encourage crossover between the two.

Making prestige brands appear less intimidating and easier to browse is particularly important, Miller found, as revealing data collected from the company’s loyalty scheme shows that customers who buy prestige products at Boots are younger than ever. In fact 14% are under 24, and 21% are aged between 25 and 34. Miller said this is because younger consumers are less likely to be attracted to the department store counters, which are seen as destinations for older customers.

Advantage Card data has also shown that counter sales staff are generally ineffective, as low conversion rates between cosmetic sectors under the same brand demonstrate that consultants are consistently failing to link sell. In a study of a single prestige brand between 2003 and 2004, Boots found that only 19% of customers who purchased a skin care product were also persuaded to purchase colour cosmetics, while 10% also picked up a product for the face and just 2% bought into fragrance.

Keith Martin, commercial director for Procter & Gamble Beauty, recognises the importance of working with retailers to enhance the shopping experience. Martin pointed out that 47% of purchasing decisions are made in front of the shelf space. These statistics show that managing the shoppers’ in-store experience is crucial to securing a sale and the responsibility lies with both manufacturers and retailers to create a positive atmosphere.

Manufacturers can influence the shopper in two ways: first working to reinforce above the line messages in-store, with graphics or branding that are consistent with advertising messages to enhance familiarity. Another important factor is making sure products are available (in stock) and easy to find, as the majority of shoppers will buy the product elsewhere if they cannot find it, giving them the opportunity to sample another retail environment.

A customer’s mood, said Martin, is crucial to influencing purchasing habits. “If the shopper is stressed or aggravated by the shopping experience, then their willingness to browse will be zero.” Martin demonstrated that 29% of these beauty shoppers are likely to seek a desired product elsewhere and that this is the primary reaction for the majority of beauty shoppers.

Another interesting discovery is that price is relatively unimportant. Instead shoppers rated availability of products, range of products and relative ease of finding the products as the most important factors, while price and promotions came considerably further down their list of priorities.

Price wars

Will King, founder of KMI, the company behind male grooming brand King of Shaves, was adamant that trading on price is a fool’s game. “In my opinion this devalues your valuable product. Its long term effects are disastrous. If you promote solely on price then sooner or later you’ll price below zero, which means that you literally place no value on the brand”.

King pointed out that quality is more important than price, supporting his claim with the continuing popularity of Boots, which he described as a trusted brand. He added that the decommoditisation of shaving is exemplified by Gillette’s high pricing strategy on razors and blades.

Buy One Get One Free (BOGOF) promotions, says King, only serve to take shoppers out of the loop for longer as they use them as an opportunity to create stock at home – or as King rather memorably put it, “Bog off to BOGOFS.” Cross brand promotions such as 3 for 2 deals are a better option for brands as they encourage trialage and prompt the majority of customers to opt for different products.

Finally, King suggested that retailers can be short sighted about volume sales and would be better served to consider a profit per square foot strategy, giving new brands and niche products a chance to establish themselves and become profitable.

Sam Whitely, commercial manager - toiletries at Boots, was ready to back up these propositions with some intriguing statistics. Whitely claims that the beauty market is lucky because it has yet to be entirely commoditised and an important consideration for manufacturers and retailers alike should be to prevent it becoming so. Over the last five years the UK’s health and beauty market has grown by 22%, reaching a value of £16.5bn, she said.

Whitely suggests that the key to continuing growth is to manage the customer’s expectation of value. Competition is growing and the top 30 brands now account for 17% of sales. In the last five years prices have dropped 4.8% and promotional activity has increased 3%.

With one in four purchases unplanned, Whitely suggested that it is important to consider what prompts people to purchase a particular brand. Brand loyalty varies widely by category, with deodorant, colourant and shaving categories attracting the most loyalty and toothbrush, hair and cosmetics consumers the most fickle.

Boots customers can also vary widely, motivated to shop for a number of reasons. Health care customers tend to gravitate towards Boots for the advice or expertise on offer. Image customers want to browse the available brands and experience new products, convenience customers seek fast tills and good service, while family customers want trusted, quality products and value for money.

Research conducted by IRI suggests that over half of shoppers opt for a particular item because the brand is trusted, of known quality or new, while only a third buy on price. Over 20m customers visit Boots every week and the number one reason for choosing to shop there is for range (50% of customers stated range as the number one motivating factor).

Whitely concluded that understanding consumer habits is absolutely essential to marketing to them. It is clear that a one size fits all strategy is inappropriate, and manufacturers and retailers should work together to come up with an effective way of targeting shoppers.

Unlocking the potential of a market can be a difficult task where products target a niche or less traditional consumer sector. Michael Pike, founder and md of G.room, gave an insight into creating a unique retail concept to reach those hard to please customers.

G.room, a men’s fashion and cosmetics store on London’s Carnaby Street, was created to reach the untapped male grooming market after observing that the evolution in men’s attitudes to grooming means that men are now prepared to buy and use beauty products, but launches are not always sufficiently adapted or targeted to male needs. Pike was convinced that grooming products could be sold to men, but it had to be in a way that was 100% different to how beauty is sold to women.

In short, moving male grooming out of the shadow of women’s beauty, making men comfortable with the concept of grooming and helping to match the environment with lifestyle aspirations were all necessary to tempt men into opening their minds and their wallets to grooming.

Aspiration is certainly something that George Hammer, chairman of Urban Retreat, banks on for his Harrod’s concession. Hammer has built up an incredibly successful business selling super prestige fragrance, specialist beauty products and treatments by trading on expertise.

By creating a platform for exclusivity Hammer said he has managed to build a reputation for luxury, and a customer base that is willing to part with its cash. Last year the tills rang up £8m proving there is considerable mileage in Hammer’s motto “time, space and comfort.”

The common thread in all of these ways to get noticed is innovation. Consumers are increasingly seeking out new and different proposals, are more savvy and are weary of repetition. By injecting passion in all stages of a brand’s development, be it in NPD, publicity or in-store brands can break free of the competition and sell on their merits, a far more durable strategy than price.