L'Oréal confirms sale of The Body Shop, Church & Dwight buys Viviscal for over $200 million, former Allure editor appointed chief creative director for Revlon, and magazines reach half the Australian population across print, digital and cross-platform.
L'Oréal confirms sale of The Body Shop
The Body Shop, founded 40 years ago, was a pioneer in the natural beauty sector. Ten years ago, when L'Oréal bought the company for 940 million euros ($AU1.3 billion), it looked like a safe bet. But strong competition in the natural and organic personal care sector has led to ailing growth in recent years. According to Jean-Paul Agon, CEO of L'Oréal - "The Body Shop is a contemporary brand, and for this reason we thought it had the potential to achieve significant growth again. But it has not managed to do so, and perhaps someone else will succeed".
The Body Shop still has extensive clout. The company operates 3047 stores in 66 countries, including Australia, and posted 920.8 million euros ($AU1.38 billion) in sales last year. Recent Bloomberg reports finger slower sales growth than the L'Oréal norm - 2.8 per cent in contrast to 5.8 per cent - and an operating loss of $US31 million as significant culprits behind the proposed $US1.4 billion sell-off.
L'Oréal is reported to be working with Lazard, the world's leading financial advisory and asset management firm, to find a buyer. The Body Shop continues to do well in the UK, Canada and Australia and Asian markets such as India and Indonesia. Analysts say it might be better off in the hands of a multinational seeking a lower cost debut in Asia.
Bloomberg predicts that even though acquisition fever is white-hot in the cosmetics industry, L'Oréal may find it difficult to attract a buyer for The Body Shop. Not only is it a vintage brand, the company isn't a leading player in the fast-growing prestige sector. A new owner would have to embark on a major restructure from closing poorly-performing stores to investing heavily in online and social media and a total makeover to appeal to Millennials and Gen Zers. For these reasons, L'Oréal has not ruled out another company taking a partial rather than a full stake, says Mr Agon.
Church & Dwight buys Viviscal for over $200 million
The median age in Australia is a whisker off 40 and the populations in other developed countries are ageing even more rapidly. Hair loss and growth stimulant products have become one of the fastest-growing sectors in the global haircare market. US multinational Church & Dwight has bought Viviscal, the hair growth supplement and treatment brand, for 150 million euros ($AU207.86 million).
Viviscal is currently sold in 30,000 outlets worldwide, including Amazon, Boots, CVS, Walgreens and Rite Aid. In 2016, the Ireland-based brand saw an uptick in sales of 33 per cent. Two-thirds of its sales outlets are in the US, and the American market was the major engine of growth. According to James Murphy, founder of Viviscal's parent company Lifes2good - "We are enormously proud of our achievement in building Viviscal into a hugely successful global brand that has enjoyed meteoric growth".
Church & Dwight also released is full year 2016 results. Sales rose 2.9 per cent to $US3.49 billion. In the personal care and health division, Batiste dry shampoo, Spinbrush toothbrushes and vitamin supplements were the bullet performers.
Former Allure editor appointed chief creative director for Revlon
Linda Wells, the founding editor of Allure magazine, is a legend among beauty media. She edited the prestigious beauty magazine, owned by Conde Nast, for 25 years before departing in November 2015. Over the past 15 months she has been involved in a number of projects, including writing a regular beauty column for The Cut, the widely-read fashion and beauty segment of New York magazine. She also crafted branded content for Hearst magazines, in collaboration with Estée Lauder and Olay.
With her wealth of experience "on the other side", Wells has been appointed chief creative director for Revlon. Her new role involves honing the look and image of Revlon's core brands across advertising, product innovation, packaging, digital and social and point-of-sale. She will also help to boost the company's strategic growth opportunities across marketing, product development and R&D.
Wells, who inaugurated the powerful Allure Best of Beauty Awards, will report directly to Revlon CEO, Fabian Garcia. Already a major fan, he noted -"Linda's extensive experience of the beauty industry and her experience assessing and reporting on the global beauty sector will elevate the prestige, image and execution of our brands. She will also be integral to ensuring the glamour, sophistication and innovativeness that are original to both Revlon and Elizabeth Arden brands' iconic heritage".
Magazines reach half the Australian population across print, digital and cross-platform says Roy Morgan
Print magazines reached over 50 per cent of the Australian population in 2016 – 12,658,000 people aged 14-plus – reports Roy Morgan Research in its latest Australian Magazine Print Readership and Cross-Platform Audience report. An increase of 3.6 per cent over 2015. Over half the interest categories enjoyed year-on-year growth, says the researcher, including Food & Entertainment (up 15.1%), Sports (up 15.1%), Business, Financial and Airline (up 8.7%), General Interest (up 7.7%) and Women's Fashion (up 5.5%).
Freebies such as Coles magazine and Woolworths Fresh took out the top two slots – up 24.5 per cent to 3,729,000 and up 24.7 per cent to 3,426,000, respectively. The top 10 paid-for magazines were: Better Homes & Gardens (1,841,000), Australian Women's Weekly (1,618,000), Woman's Day (1,313,000), New Idea (1,145,000), National Geographic (1,098,000), That's Life (693,000), Australian House & Garden (633,000), Taste.com.au magazine (605,000), Australian Geographic (591,000) and Take 5 (628,000).
Fashion magazines that enjoyed a good year because of a similar extended reach across print, digital and cross-platform audiences, included Vogue (633,000), Marie Claire (437,000), Elle (270,000) and Harper's Bazaar (214,000).
Snippets from the wires
- Gucci ended 2016 on a high. Sales were up 12.3 per cent over the previous 12 months to 4.378 billion euros ($AU6.06 billion). The Italian luxury brand also announced the launch of a new fragrance. The first juice since its fragrance license moved from P&G to Coty. Slated for release in the second half of the year, it will reflect the style and influence of Gucci's creative director, Alessandro Michele.
- Sales at Victoria's Secret, the flagship of L Brands, flatlined in 2016. But Bath & Body Works picked up the slack with a 6 per cent increase in revenues. L Brand's full year sales rose 3 per cent to $US12.57 billion.
- The Yoox Net-A-Porter Group has reported a 12.4 per cent jump in sales to $US2 billion since the two online retailers merged. North America remained the largest market with a revenue increase of 14.1 per cent to $US619.5 million, but the company enjoyed growth in all regions.
- Burt's Bees new lip and colour offerings proved a key player in the second half of 2016 for The Clorox Company. The multinational's lifestyle division enjoyed sales of $US469 million - a lift of 4 per cent.
