Hyatt buys wellness brand Exhale; First new men's fragrance for Creed in seven years ahead of Australian expansion; Drill down: the global anti-ageing skincare market; and double-digit growth in fragrances rev up sales at Jimmy Choo
Hyatt buys wellness brand Exhale
The wellness trend has exploded in recent years, from the new vertical at Sephora to the growing number of luxury yoga retreats worldwide. In January, the Hyatt hotel chain acquired the Miraval Group, one of the world's most prestigious resort and spa companies, for $US375 million. To further extend its footprint in the rapidly expanding sector, Hyatt has bought Exhale, which has 25 locations in the US and the Caribbean, and specialises in spa services and boutique fitness classes.
The financial details of Hyatt's latest purchase were not disclosed, but the hospitality heavyweight, with annual revenues of $US4.4 billion, is planning to leverage both brands by integrating their experiences and amenities into its global portfolio. The Miraval acquisition was based on the development of more Miraval-branded resorts, but future plans for Exhale are more diverse. The majority of Exhale locations are in key US cities such as New York, Los Angeles and Miami and while Hyatt plans to roll out the brand in more resort settings, it will retain the standalone urban properties. Exhale's most attractive point of difference for Hyatt, which is celebrating its 50th anniversary this year, is its focus on mindfulness, one of the fastest growing health trends, especially for stressed-out corporates.
First new men's fragrance for Creed in seven years ahead of Australian expansion
Niche fragrances now account for 12 per cent of global fragrance launches and major designer scents are routinely riffing off the trend-setting juices. It's become a cliché that every man should try a fragrance from the legendary French brand Creed at least once in his life and the message has clearly got through loud and clear. The 257-year-old heritage perfume house is enjoying annual double-digit growth and analysts estimate that its global business is hovering around the $US110 million mark and climbing fast.
Agence de Parfum represents Creed in Australia and one of the highlights for the brand in the lead-up to Christmas is its debut in Myer Sydney and Myer Melbourne stores and on the website, myer.com.au. There's been a regular roll-out of Creed fragrances in Australia, notably through David Jones, including the global bestseller Aventus. But starting this week Viking, the brand's first new fragrance for men in seven years, begins its global roll-out and will be available in Australia in time for Christmas.
Featuring a longship on the label – a fairly commercial move for Creed – the new scent ties in with the upsurge of interest in the fearsome Norse warriors, sparked by the TV series Vikings. The key notes certainly mimic their famous voyages from bergamot, Sicilian lemon and pink peppercorns in the opening blast to a heart of peppercorns, Bulgarian rose and peppermint, and a drydown of Indian sandalwood, Haitian vetiver, patchouli and lavandin absolute.
Drill down: the global anti-ageing skincare market
Allure, the prestigious US beauty magazine, recently announced that it would no longer use the term anti-ageing. But the category continues to boom under that name, says Euromonitor, and the premium end of the market is expected to continue its runaway growth as mass-market sales flatline. Prestige products have a higher dollar value per SKU, of course, but revenues at the mass and premium ends are currently running neck-and-neck in the major regional markets.
Some of the key results include:
- Global anti-ageing skincare sales: $US13.3 billion for mass; $US11.8 billion for premium;
- Asia/Pacific (APAC): $US5.8 billion for mass; $US5.85 billion for premium;
- USA: $US1.6 billion for mass; $US2.2 billion for premium;
- Western Europe: $US2.9 billion for mass; $US2.46 billion for premium;
- South America: $US1.3 billion for mass; $US444.5 million for premium
- The two major regional markets – Asia/Pacific and Western Europe – account for the lion's share of new anti-ageing skincare launches worldwide: 37 per cent and 40 per cent, respectively. Within APAC, three countries lead the charge in anti-ageing releases: South Korea and Japan (both 23%) and China (22%).
Double-digit growth in fragrances rev up sales at Jimmy Choo
Jimmy Choo, acquired two months ago by Michael Kors for $US1.2 billion, is proving a good bet ahead of the finalisation of the takeover. Sales for the six months to June rose 4.5 per cent to $AUD328.08 million, and pre-tax profits nearly tripled to $AUD29.46 million, up from $AUD10.74 million over the same period in 2016.
The licensing businesses – eyewear and fragrances with partners Safilo and Interparfums – enjoyed revenue jumps of 40.3 per cent and 24.3 per cent, respectively. Japan delivered the biggest uplift in Asia for the period of 11 per cent, notably in men's footwear and fragrance. Mainland China also reported double-digit growth because of increased promotion and brand awareness. It’s just the news Michael Kors wants to hear as the US and European markets experience softer luxury demand from a slowdown in department store sales and tourist traffic in key cities.
Snippets from the wires
- Counterfeit beauty products from China are costing the Korean cosmetics industry $US7.2 billion a year, according to a report from Business Korea. Nearly 65,000 Chinese counterfeits of popular K-Beauty skincare and makeup, mainly from AmorePacific and Tonymoly, were discovered on e-commerce giants such as Alibaba in 2016.
- Andrew Stanleick, the former President and CEO of Coach Europe, has been appointed Senior Vice-President, Coty Consumer Beauty Europe. A veteran of Unilever and L'Oréal, his main responsibility is to oversee the growth of European sales of Rimmel, Bourjois, Max Factor and Adidas.
- Reasonably priced, on-trend private label makeup brands such as Models Prefer from Priceline have enjoyed huge success. Walgreens Boots Alliance has launched the CYO Color Collection in select Walgreens stores and on walgreens.com in the US. Aimed at Gen Z beauty fans, the 160-SKU line-up is priced from $US3.50 to $US7.50.
- It's proving tough to put an ROI on social media campaigns and mentions and no, wonder if a new US study is any indication. According to a survey from CivicScience, only one per cent of respondents said they made a purchase because of a Snapchat ad, and only 4 per cent said they bought something because they saw it on Instagram.
- Lululemon has proved immune to the recent downturn in the global athletic apparel market. Sales rose to $US581.1 million in Q2 and the company expects fiscal 2017 sales to reach between $US2.54 billion and $US2.95 billion. According to CEO Laurent Potdevin, Lululemon is on track to reach its goal of $US4 billion in annual sales by 2020.