L Catterton acquires major stake in Japanese natural cosmetics brand; Kao pushes ahead with new brand launch on Amazon; majority of US consumers believe stores should re-open by end of May; and at-home manicures - the new lipstick effect.
L Catterton acquires major stake in Japanese natural cosmetics brand
One of the major trends emerging from the COVID-19 crisis is an increased interest in natural and organic products in the world's major regional beauty markets. During China's lockdown, online sales of natural skincare surged and the switch is likely to be longterm.
L Catterton, the investment arm of LVMH, the world's largest luxury goods group, has taken a major stake in Etvos, a Japanese natural cosmetic brand. Founded in 2007, the company is renowned for its mineral makeup, skincare based on ceramides and natural actives such as argan and apple stem cell extract, haircare and baby products. Highly ranked on @cosme, one of Japan's biggest beauty review sites, Etvos is mainly sold in Japan.
With the growth of J-beauty, L Catterton Asia is a perfect partner to expand the brand internationally. As part of the world's leading consumer-focused private equity firm, it has a wide network of industry conducts to help Etvos accelerate store openings in Japan and across Asia. Currently, the brand has several concept stores in four major Japanese cities, including Tokyo, and is also sold in multi-brand retailers and online.
Following the completion of the deal, Norbert Leuret, president of LVMH Japan, and Masatoshi Kuroda, formerly special adviser to Chanel, will become non-executive directors. According to Toshitaka Shimizu, managing director, L Catterton Asia: "Despite heightened uncertainty facing markets globally, we remain confident that Etvos, which has already established a unique positioning in the cosmetics market with a strong focus on product development, is poised for continued growth and expansion".
Kao pushes ahead with new brand launch on Amazon
New beauty and personal care products are months and even years in development. A pressing question for many companies at the moment is whether to go ahead with a launch as planned or postpone the rollout for a later date. Kao, the Japanese multinational whose portfolio includes Biore, Goldwell, Jergens, John Frieda and Molton Brown, has decided to push ahead with the launch of a new personal care brand designed specifically for the US market.
Called MyKirei, the lineup is in sync with the clean and natural beauty trends benefiting from increased consumer interest in preventative and healthy skincare and hair care. To be launched exclusively on Amazon in the US, where the online giant's beauty and personal care sales have enjoyed huge growth in recent weeks, the first introductory phase will centre on three products - nourishing shampoo and conditioner and hand wash. Traditional Japanese ingredients such as yuzu fruit, rice water and tsubaki flower are a key point-of-difference.
Another reason Kao has adhered to its launch calendar is because the brand also kicks off the company's Kirei Lifestyle Plan, aimed at protecting the environment, fighting climate change and reducing its use of plastic. A gamechanger is the use of bottles which utilise 50 per cent less plastic and retain rigidity through airfill to remain upright. The water-tight design also prevents contamination and allows consumers to use the products down to the last drops. Kao has also partnered with TerraCycle to develop a program to help consumers re-cycle the packaging and the pumps.
All of the launch products are vegan-friendly, plant-based and 95 per cent bio-degradable. Kirei has several meanings in Japan, says Karen Frank, president, Kao USA. "It can describe beauty and cleanliness, as well as simplicity, balance and sustainability. The Kirei sensibility has always been unique to and treasured by the Japanese people. With MyKirei, we are bringing this wisdom to the Western consumer with innovation for a gentler, more sustainable way of living".
Majority of US consumers believe stores should re-open by end of May
With indications that the COVID-19 infection curve is flattening, not only in Australia but also in the US, which has been more deeply affected, a new study by First Insight has revealed growing optimism. According to the world's leading customer-centric merchandising platform, over 87 per cent of Americans are still worried about the impact of the coronaviris pandemic, but the key findings are revealing.
As in Australia, there have been worse-affected areas, notably New York. Overall, 32 per cent of Americans felt that stores should re-open by the end of April/beginning of May, reports First Insight. In major cities such as Detroit, Chicago, New Orleans and San Francisco, the percentage increased to 43 per cent.
Men were more keen to see stores re-open - 39 per cent compared to 25 per cent of women - for an end of April/early May deadline. A ratio that still held true when the respondents were asked about an end of May date for re-opening - 65 per cent by contrast to 54 per cent of women.
The later date was appealing to all the major demographics of both sexes - 59 to 63 per cent - to yield a median of 60 per cent of Americans keen to see bricks-and-mortar stores open their doors again by the end of May. Millennials were more hopeful of the earlier end of April resumption of business - 39 per cent - compared to 31 per cent of Gen Zers, 30 per cent of Gen Xers and 28 per cent of Baby Boomers.
It's clear that people are getting antsy and ready to get back to some form of normalcy, including shopping in-store, said Greg Petro, CEO of First Insight. He also suggests that retailers and brands should be planning now to ensure they have the right product and price when the time comes, even if it's just being offered online for now.
At-home manicures - the new lipstick effect
That's the theory gaining traction in the US and the UK, says the NPD Group. Lipstick famously held the title of recession-proof makeup product from the early 1970s to 2001. Eye makeup surged to the fore during the GFC. With nail salons and professional beauty salons shuttered for the duration in the UK, nail polish has become one of the current "saviours" of beauty sales in the UK, reveals the researcher.
As pubs and restaurants were placed in lockdown, online sales of nail products enjoyed double-digit growth. Sales of prestige nail products rose 12 per cent in the week beginning March 16th and a further 24 per cent in the following weeks, reports NPD.
Breaking down the sector - sales of base and top coats rose 102 per cent, nail care products increased by 13 per cent and coloured polish revenues were up 18 per cent. The three most popular shades were pink, beige and red. Chanel enjoyed the top three best-selling products among the upmarket nail colours - Rouge Noir, Organdi and Coralium.
The increase in sales of nail products online, particularly nail enamel shades indicates that nail care could be the COVID-19 Lipstick Effect, noted Emma Fishwick, account manager, NPD UK Beauty. "Consumers are increasingly turning to self-care and home-based beauty treatments like at-home manicures to improve wellbeing and mood. An application of nail polish is quick, simple and provides an instant result".
Even though major pharmacy chains remain open, Priceline is also experiencing a rise online in nail care sales.
Snippets from the Wires
- Cire Trudon has built a local cult following since its launch by Agence de Parfum, Australia's most respected niche perfume and home fragrance distributor. Founded in 1643, the storied brand is the world's oldest candle maker still in business and has also made a successful foray into perfumes and home fragrances. Cire Trudon's products graced the palace of Versailles in the reign of Louis XV and were also favourites at Napoleon's Imperial court. The French government has recognised the brand's contribution to the country's famed Art de Vivre (art of living) culture and awarded it a Living Heritage Company label, joining such iconic names as Hermes, Chaumet and the Bristol hotel in Paris.
- Eye makeup sales have soared in China because so many women wear face masks outside the home. Huda Beauty recently launched on Alibaba's Tmall and the Chinese online giant has reported that the brand's Mercury Retrograde palette sold out in seconds. More than 300,000 visitors flocked to the brand's flagship store on the first day.
- Beauty and cosmetic trade shows have been major casualities of the coronavirus pandemic. Reed Exhibitions has re-scheduled in-cosmetics Global to October 6th to 8th in Barcelona.
