Friday, May 13, 2005

What's New in Beauty - May 12, 2005: Yue-Sai, Costco, Webby Awards, cosmetic buying trends

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China's Yue-Sai goes global: L'Oreal will launch Yue-Sai, the Chinese cosmetics brand, first in Asia and then in Europe and North America. Yue-Sai was founded by Chinese-American TV presenter Yue-Sai Kan. L'Oreal acquired Yue-Sai from the Lancaster Group in January 2004.

Costco developing its own cosmetics brand - Costco, the Seattle-based wholesale buyers' club that can supply you from cradle to grave, is developing its own cosmetics brand in partnership with Borghese. The Style Page has previously written on cosmetics brands exclusive to a store chain: IsaDora (Walgreen's), Lumene (CVS), Per Una (UK's Marks & Spencer), No 7 (UK's Boots), and good skin, American Beauty, and Flirt! (Kohl's).

The Webby Award winners have been announced: in the Beauty and Cosmetics category, the winner was, a web site for method's holiday gift set. Its gimmick was providing a place to read confessions and post confessions to "come clean." The People's Choice winner was the Mary Kay personal consultant site - no surprise there.

Finally, the article Specialty format steals department store beauty dollar from discusses how specialty and discount stores are taking market share for cosmetics purchases from traditional department stores. The merger of the major U.S. department store chains - Federated (Bloomingdale's and Macy's) and May (Lord & Taylor, Robinson's-May, Hecht's, Famous-Barr, etc.) will result in fewer consumer choices among department stores.

The Style Page notes that one challenge is that salespeople at department stores represent and work on behalf of a particular cosmetics brand. If department stores and their suppliers (notably Estee Lauder Companies) want to win back market share, they should scrap the current system in favor of salespeople/advisors who can advise on several brands and provide central checkouts for cosmetics purchases.

Update: Soon after I published this post, I found that Shoppers Drug Mart, a drugstore chain in Canada, is negotiating with Estee Lauder Companies to distribute various Estee Lauder brands through their stores. More evidence about the change in buyers' habits.

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