The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
NEW YORK, United States — Selling Covergirl makeup to a modern beauty shopper has been neither easy nor breezy.
Two years ago, the brand retired its 20-year-old “Easy, Breezy, Beautiful” slogan in favour of a new one, “I Am What I Makeup.” The messaging, along with minimalist packaging, a new Times Square flagship and diverse spokespeople like actress Issa Rae and the model Maye Musk, was intended to hop on the trendy idea of makeup as self-expression. It was also a bid to claw back sales lost to newer brands like Colourpop.
It didn’t work. In the year ending June 30, Coty, which owns Covergirl, reported a decline in like-for-like sales in the “low teens” for its colour cosmetics brands, which also include Sally Hansen and Rimmel, among others. Jefferies estimates Covergirl’s retail sales fell by 5 percent in 2018, to $1.2 billion.
Covergirl made a mistake common to many aging brands: it assumed that imitating newer entrants was the key to reversing sliding sales. The problem with that strategy is that the new slogan and packaging may be on trend, but the younger brands did it first, and probably better.
“Based on all of the data we can see... the rebranding investment has not generated a return,” said Jefferies analyst Stephanie Wissink. “[Covergirl] needs to recognise that the messaging… didn’t separate them from the pack. They didn’t come in with any authority.”
Covergirl declined to comment.
Covergirl is among the most high-profile beauty brands to attempt a turnaround in recent years, but it’s far from alone. The rise of Instagram and a crowd of savvily packaged start-up labels has sent plenty of once-venerable brands into decline. Bliss, Perricone MD, H2O+ and Crabtree & Evelyn are among the decades-old brands that have executed a total makeover — sometimes more than one — to win back customers who look to social media for recommendations and expect constant innovation in their beauty products.
"It's not enough to have a good product. Ten to 15 years ago, that was enough," said Cary Leitzes, founder of creative agency Leitzes & Co. "Now, your price point has to be right, as well as the packaging design and thinking about Instagram and creating a whole world. Your customer expects more."
Industry experts and executives at these newly refurbished brands shared turnaround strategies, the mistakes they’ve made and the advice they’d offer to others.
The Formerly Cool Brand That Lost Its Way
Bliss, owned by L Catterton since 2015, made its name with bodycare products like Lemon and Sage Body Butter and Waxing Poetic hair removal kits. In the 1990s, it was known for cheeky branding and outspoken celebrity fans.
It's not enough to have a good product. Ten to 15 years ago, that was enough.
But in recent years, even customers who still craved their body butter came to view Bliss as overpriced and difficult to find, said Chief Executive Meri Baregamian. In other words, the brand had the tricky task of attracting young customers to products their moms likely used.
In 2018, Bliss dropped prices by about 50 percent and launched trend-driven items like watermelon masks alongside a few legacy products (updated to “cleaner” formulas). The logo and packaging were tweaked, though still recognisable to a consumer who first encountered the brand in the 1990s. A cellulite product, Fatgirl Slim, was renamed Fabgirl Firm.
At Ulta, which has stocked the brand for many years, new products were placed in an end display. Though Bliss’ products had historically been stocked in the bath and body aisle, the displays helped portray Bliss as part of the trendier skincare universe.
The brand has added new stores with Ulta, entered 1,800 Target locations and launched at CVS. Baregamian said the brand has experienced “strong double-digit growth in brick-and-mortar and near-triple-digit growth on Amazon” since the relaunch.
The Serious Doctor Brand That Went Back to Its Roots
Dr. Nicholas Perricone was a regular on the Oprah show and wrote multiple books in the 1990s and early 2000s. He launched a skincare range in 1997 with high-tech sounding names like Acyl-Glutathione Eye Lid Serum. Over the years, it grew into an assortment of over 100 products promising a confusing and overlapping array of benefits.
Perricone’s sales were stable, but the brand, popular with over-40 women seeking anti-ageing treatment, needed to attract younger customers. In 2016 it added two new ranges aimed at Millennials and stopped doing meet-and-greets featuring Dr. Perricone.
If a 20-year-old boy wants to buy Cold Plasma, we should sell to him.
That turned out to be a mistake. The new products didn’t sell well, and the founder-less marketing fell flat.
“We saw that we couldn’t necessarily re-define the brand without him,” said Robert Koerner, Perricone’s chief marketing officer. “It was definitely a mistake to walk away from him.”
In 2018, Perricone dropped over 40 items, updated formulas and put its founder back into the public eye. Products were organised into groups based on treatment results. The brand stopped advertising in print, and developed online campaigns around the idea of “serious” skincare, which it sees as transcending age or gender.
“If a 20-year-old boy wants to buy Cold Plasma, we should sell to him. A lot of our ad targeting is very much based on behaviours and look-alike audiences,” Koerner said.
Pericone is planning to launch new ranges and Koerner says there is still opportunity to tweak the existing product line.
“It’s a painful process to have to relaunch an entire portfolio,” he said. “It was worth the pain, but it’s much better to be adapting the portfolio slowly over time to avoid these big disruptions because they’re big risks. It’s an expensive exercise.”
The Niche Brand Leaning Into Its J-Beauty Parent
H2O+, a body and skincare brand founded in Chicago in 1989, never achieved Bliss’ name recognition, but hit $120 million in annual sales at its peak a decade ago, mainly from upscale malls. It still maintains a contract it’s held with Disney since 2006, providing bath amenities to its resorts.
It stopped manufacturing its own products shortly after it was sold to Japanese beauty company Pola Orbis in 2011. In 2016, it closed all 75 of its stores and attempted to pivot to trendier skincare products aimed at Millennials. Sales declined from about $23 million in 2016 to $18.7 million in 2018.
We are prioritising mindset over Millennials.
New H2O+ Chief Executive Junko Gomi is taking a more measured approach this time around. The brand has stopped chasing trends. A new four-product range, Hydration Sensitive System, includes a $42 cream.
“We are prioritising mindset over Millennials,” Gomi said.
H2O+ will also now manufacture its products in Japan at Pola Orbis facilities. So-called J-beauty brands are experiencing some momentum in Western markets. DHC just launched into Ulta and Unilever recently acquired the US-founded, Japanese-made brand Tatcha.
“We see ourselves as a brand that doesn’t necessarily fall into the J-beauty category nor does it really fall into being US-specific either,” Gomi said. “The market is missing the cross-pollination that melds the best of both.”
The brand will be sold direct-to-consumer and via Amazon’s luxury beauty page. Gomi hopes to grow H2O+ into a “strong collection” by the second half of 2020, and then she will start to court retailers again.
The Victim of the Mall Apocalypse
Founded in the 1970s in the US and now owned by Hong Kong investment company Nan Hai, Crabtree & Evelyn stuck with its increasingly dated English garden-inspired bodycare branding. At the height of its popularity, it had hundreds of mall stores selling floral hand cream.
The brand has undergone multiple bankruptcies and acquisitions and closed the last of its stores in January. In August, it relaunched online with a Millennial pink, rose-scented body range and a small unisex collection of skincare, including cleansers and a mask. The branding is a 180-degree turn; a recent Instagram post of bare cleavage prompted one follower to respond, “Wow! This brand has made a shift from the pearl-clutching, Vera Bradley-toting boutique I worked at in college.”
Time will tell whether Crabtree & Evelyn chose the right strategy. Such a drastic turn can alienate consumers with fond memories of the original branding, without attracting new customers.
“There’s no rhyme or reason, no ingredient story going on that binds it all together,” said Sonia Summers, founder of the Beauty Strategy Group, speaking generally about relaunches that flop. “It’s just executives in an office looking at what everyone else is doing.”
The brand declined to comment. But it’s clear that Crabtree & Evelyn is going after a younger demographic. Chief Executive David Stern said in a press release that the brand will focus on “exploration” and launch concept shops globally.
Attempting a dramatic repositioning after a period of customer indifference and serious sales decline is much harder than evolving subtly with the times.
“You need to understand who your customer is and continuously evolve so that it’s not seen as, ‘Oh my god, they’re rebranding,’” Summers said. “There will be all these new indie brands coming in looking very sexy with new products and new innovation and you’re still looking like you did 10 years ago.”