Chain Drug Review, March 16th, 2020

BEAUTY CARE REPORT RETAIL Stores spruce up beauty aisles to court consumers NEW YORK Mass market stores are boring no more Following massive overhauls of the look of mass beauty departments Doug Howe the retailers chief merchandising officer wants to see Kohls share of beauty a much higher margin category than most of Kohls staples expand beyond the current 2 of total volume Howe knows a lot about building categories hes a former executive with QVC Old Navy and Walmart He calls beauty a space the retailer is heavily invested in Among the brands in the new department are Chopstick Hair Tools Elizabeth and James fragrance Jason Wu fragrance and Formawell Beauty tools which featured Kendall Jenner in collateral materials Kohls will evaluate the performance and update based on feedback H E B has always been one of the most admired beauty retailers in the grocery industry but its latest department takes it into the stratosphere Called Beauty by H E B the new look Influencers now in a different kind of spotlight NEW YORK Influencers are still an important part of any brands marketing campaign The influencer economy is valued influencers should disclose their relationships stating that video endorsements should include a disclosure in the video itself not just in the description field Influencers cant talk about their experiences with a product if they havent tried it themselves Consumers are more leery of paid posts The regulations could help restore consumer confidence in posts Still the industry has been gravitating away from mega influencers to micro and even macro who have fewer followers but more power with their fan base Experts at influencer marketplace firm Octoly find 2 to 3 a good engagement rate for macro influencers with 4 to 6 for micro influencers That suggests brands get a better ROI with micro influencers at CVS Pharmacy and Target Corp other contenders are revealing their own splashy departments in the race to court beauty shoppers Among those raising the bar are Kohls Corp H E B and even Sephora USA Inc a retailer that siphoned off many mass market consumers over the past decade Late last year Kohls revealed its newest interpretation of beauty in 12 stores Kohls has long tinkered with beauty once partnering with Estée Lauder for exclusive brands This time the retailer has doubled its footage for beauty to about 1500 square feet There is ample use of Modifaces augmented reality mirrors which virtually show consumers how shades look on them has brands unheard of in the mass market along with service from beauty advisers who undergo 100 hours of training The first of the fresh look was revealed late last year in a 4000 square foot boutique in a San Antonio store complete with a pink runway leading to the department As mentioned CVS upped the game with special fixtures for legacy brands rather than humdrum wall displays A separate wall is dedicated to emerging brands that were primarily sold direct to consumer in the past Walgreens is taking a U turn in some stores and moving its heritage brands to the entrance instead of its house brands Walmart continues to burnish its image although Jody Pinson vice president of merchandising for beauty admits it is hard to enact changes across more than 4700 doors Sephora a retailer that dramatically changed where Americans shop for beauty is opening the most new stores in North America in a single year in its history One hundred new sites will open many in street and local centers as well as new and established shopping malls But the focus will be off mall the company says which is closer to where she lives and works That strategy could put Sephora closer to drug and discount stores too New stores will be powered by 100 renewable energy helping to reduce the retailers energy consumption and tying into its sustainability program As part of Sephoras expansion the mix will include a smaller 4000 square foot format that is designed to allow the retailer to more seamlessly integrate into street and local center locations It will feature layout changes including a more prominent up front location for hair care and skin care as well as a new Sephora Studio for skin and beauty services The stores will keep the retailers Beauty Advisor service along with in store offerings such as mobile checkout Find Your Fragrance and Beauty on the Fly A new clean beauty department is also an important wrinkle As we look at ways to continue to be more inclusive and accessible brick and mortar continues to be a huge opportunity for us to deepen emotional connections with our clients and local communities says Jean André Rougeot chief executive officer of Sephora Americas Its through our interactive store environment our best in class educational tools and services and incredible engagements with our beauty advisors that we are able to best service and inspire clients on their beauty journey at 65 billion and set to double in size this year However the landscape is changing as new laws are put into place and marketers take a harder look at the pros and cons of linking with influencers Bad behavior by a content provider can have a sales backlash Consumers are more leery of paid posts And laws are changing in the still evolving industry Last year the Federal Trade Commission issued a new guide for influencers that widens the scope of what they are encouraged to disclose Disclosures 101 for Social Media Influencers details when and how social media influencers should disclose their partnerships both paid and unpaid The widened the scope of what influencers must disclose to beyond just money to anything of value Tags likes and pins are considered endorsements of a brand or product The guide also describes how It was a topsy turvy influencer world last year with a new term emerging the cancel culture The biggest example was the feud between James Charles and Tati Westbrook that resulted in 3 million people unsubscribing from Charles social sites Hes gained many back but the squabble raised more questions about linking up with social figures Celebrities who used to dominate the endorsement and partnership universe are trying to regain their power when it comes to brand promotion This year celebs such as Tracee Ellis Ross Taraji P Henson and Millie Bobby Brown all launched their own brands In fragrances Cher got back into the game with a new scent Influencers countered with their own brands rather than collaborations such as a new hair line called Hairitage from YouTuber Mindy McKnight and Dragun by Nikita Dragun Theres also buzz that Charles might launch his own collection His collaborations with Morphe sold out four times with consumers waiting around the block to buy at Ulta Beauty But even influencers hit bumps in the road Jaclyn Hill known for her collaborations with Becca Cosmetics launched a new makeup line last summer that was instantly called out for sanitary issues Hill had to recall the line She also had to issue an apology and refunds She relaunched a holiday collection but she still has a long road ahead to rebuild her audience Retailers continue to put out feelers for hot social star backed brands Ulta Beautys Sparked department helps launch lines such as Love and Wellness from Lauren Bosworth a wellness content provider Kohls has a program with Instagram and Facebook to identify hot digital brands Perhaps the biggest question will be how much impact the power of Kylie Jenner and Coty Inc s marriage will have on her beauty business Coty acquired the majority stake of Jenners booming business Jenner continues to lead the creative force and she hasnt addressed the change in ownership So the question is whether her fans will call her out for selling and be less interested once a big brand has taken over Jenner continues her new product launch schedule with new items for her skin collection and even a color palette named after her two year old daughter Stormi She also has taken out trademarks for a beauty exhibition similar to Beautycon 38 Chain Drug Review March 16 2020