Giant Killers?

By Imogen Matthews, In-Cosmetics | November 3, 2010

Consumers' appetite for and expectations of newness have opened the door for smaller beauty brands, especially those that are able to offer a genuine point of difference in markets dominated by multinationals.

The worst of the recession appears to be over, but the road to a full recovery for the beauty industry is proving to be slow. Retailers are taking a hard look at the brands they stock and have no hesitation in weeding out the weaker ones. In such an environment, niche brands might expect to be the losers, but often it is those that do things differently that are able to stay the course.

The British Bulldog Approach
Simon Duffy is co-founder of natural men’s toiletries brand Bulldog, which claims to be the first natural mass market line for men. Since its launch in 2008 in UK supermarkets, it has more than held its own against the behemoths Gillette and Nivea for Men. Bulldog is now sold in Japan, Sweden and from July 2010, the U.S., where it launched in Whole Foods Markets.

“Bulldog does things differently from the branding through to the communication. The idea of being different is in our DNA,” stated Duffy. “We were the first men’s brand with natural formulations in the UK and our packaging is also designed to stand out on shelf against products which are mostly blacks, blues and silvers.”

A men’s line with some bite. British Bulldog is building awareness in the U.S.
As a new brand, Duffy found the biggest barrier to growth was building awareness.

“Once men have tried the product, they prefer it,” he explained. “Then retailers are prepared to give you more space.”

Traditional advertising on TV and in the press was ruled out as too costly, so Duffy took a different route, exploiting social media as a way of getting to its target audience directly.

“We developed the David Mitchell Soapbox online, which reached a large number of men. It is currently the No. 1 property on the web and No. 1 on iTunes,” revealed Duffy, who also pointed out, “big companies tend to be behind the curve. Yet a good idea executed well rises to the top.”

Smashbox Has a Leg Up
Many niche brands dream of being snapped up by a multinational and becoming an international sensation. But for every M.A.C and Bobbi Brown, there are dozens that have failed to make the grade. Niche brand acquisitions tend to be the exception these days, reflecting a far more austere climate. The recent acquisition of makeup brand Smashbox by Estée Lauder may signify a change in attitude toward niche, but the brand must fit the right criteria.

“One of the key benefits of the acquisition for Estée Lauder is greater coverage in alternative channels,” pointed out Oru Mohiuddin, home and personal care analyst at Euromonitor International. “Estée Lauder derives most of its sales from department stores, but consumers are gradually shifting away from such outlets to other channels, thus threatening the company’s revenues.”

Recently, Estée Lauder has made its website transactional and has started selling Bobbi Brown, Origins, Clinique and Ojon on QVC in the U.S.

“It is in this area of alternative channels where Smashbox offers the greatest benefit,” stated Mohiuddin. “Smashbox has made good progress in digital and social media and Estée Lauder expects to benefit from this expertise.”

The brand sells in specialist retail stores as well as QVC, where it is ranked as one of the top 10 brands. Smashbox stands to gain from greater global coverage with its new parent’s extensive distribution network.

A Natural Niche
Euromonitor has observed that from early on in 2009, natural brands were riding out the economic storm better than others at the top of the price scale.

“The reason for this discrepancy largely seems to be that the prime motive for buying standard premium products is aspirational and therefore easier for consumers to ditch,” explained Carrie Lennard, industry analyst, beauty and personal care, Euromonitor International, who noted that more retailers and manufacturers have jumped on the natural bandwagon. Burt’s Bees is a brand that sat comfortably on the shelves of the drugstore Duane Reade for a while in the U.S., but ventured abroad into the high street retailer Boots.

“As the big players in natural beauty like Lavera and Burt’s Bees are moving from niche to mainstream, smaller players are now adopting innovative strategies to compete with bigger names,” stated Lennard.

Natural Australian skin care brand Bellaboo is an example. With a product line targeting teens, it initially launched in its native Australia in approximately 1,000 outlets and has recently moved into the U.S.

“Drugstore chain Rite Aid and supermarket Giant Eagle both began stocking the line in 2009 in a bid to attract the lucrative, but hard to reach, teen and tween market,” she added.

Finding an angle other brands have yet to recognize is key to building a successful niche brand. For example, the market for Halal beauty and personal care products is relatively new, but the development of a global standard by the International Halal Intergrity Alliance (IHI Alliance) should help to open up the market for new halal brands.

“There are currently some local Halal cosmetics standards already in existence. However, a globally recognized standard should help to instill more confidence when buying halal products,” explained Lennard.

Lennard said that the concept of the niche beauty brand fits well with the new zeitgeist of a shift away from the excessive consumption that was prevalent during the boom years.

“There will still be a sizeable proportion of consumers, who are willing to fork out more for niche brands which they feel are worthwhile paying extra for. Niche players need to be clear, concise and convincing about their unique selling proposition (USP) in order to persuade shoppers to do so.”

Bulldog and Euromonitor will participate at next year’s In-Cosmetics marketing trends presentations, taking place in Milan on March 29-31, 2011.
More info: www.in-cosmetics.com

Related End-User Markets:

blog comments powered by Disqus
  • Shin-Etsu Updates Sunscreen Toolbox

    October 6, 2011
    Shin-Etsu Updates Sunscreen Toolbox

  • Innovation On Display

    Melissa Meisel, Associate Editor||February 3, 2016
    P&G Beauty Digital Studio showcases new products for 2016

  • Testing for Sustainable Preservatives

    Adam P. Byrne, William Michael Hart-Cooper, Kaj Johnson, Larry H. Stanker, Dominic W. S. Wong, William J. Orts||January 4, 2016
    A rapid, inexpensive and qualitative protocol for determining microbial growth inhibition.

  • Burgeoning Beauty

    Burgeoning Beauty

    Melissa Meisel, Associate Editor||January 4, 2016
    A look at trailblazers for 2016 and beyond.

  • In-Cosmetics Paris Has Sights on US

    In-Cosmetics Paris Has Sights on US

    Imogen Matthews , In-Cosmetics||December 2, 2015
    Market focus is on the USA.

  • Just Wild About Harry’s Cosmeticology

    Just Wild About Harry’s Cosmeticology

    Tom Branna, Editorial Director||November 2, 2015
    The ninth edition, edited by Meyer Rosen, has been expanded and improved with an emphasis on the future of the industry.

  • Lush Is Flush with Novel Ideas

    Lush Is Flush with Novel Ideas

    Tom Branna, Editorial Director||November 2, 2015
    New products are the lifeblood of every company. Lush will launch more than 200 of them.

  • Contract Manufacturing/Private Label Directory

    Contract Manufacturing/Private Label Directory

    October 1, 2015
    Our directory is your source to find a manufacturer to get your product to market.

  • Winner Unmasked

    Winner Unmasked

    October 1, 2015
    Laneige’s Water Sleeping Mask takes home top honors as Happi’s first Anti-Aging Product of the Year.

  • An Arduous Task?

    An Arduous Task?

    Tom Branna, Editorial Director||October 1, 2015
    Elizabeth Arden's JuE Wong is confident that the way to right the company’s ship is by tapping into its rich heritage.

  • Tried & True

    Tried & True

    Melissa Meisel, Associate Editor||October 1, 2015
    Test providers strive to prove a product’s efficacy for consumer confidence.

  • Market Your Cosmetics In Europe with Safety

    Market Your Cosmetics In Europe with Safety

    Pascal Yvon, IDEA TESTS Group||October 1, 2015
    Compliance to European safety regulations for cosmetic products, final formulations and ingredients.

  • Talking Point

    Talking Point

    Christine Esposito, Associate Editor||October 1, 2015
    For its inaugural Sustainability Dialog in Frankfurt, Clariant gathered stakeholders that included a mix of customers, third

  • A Consumer Revolution

    A Consumer Revolution

    Melissa Meisel, Associate Editor||June 1, 2015
    IRI’s 2015 Summit celebrates the progression of information.

  • Interior Design

    Interior Design

    Melissa Meisel , Associate Editor||May 1, 2015
    Nutritional products can improve and beautify skin from the inside out.

  • Face Valued

    Face Valued

    Christine Esposito, Associate Editor||May 1, 2015
    Skin care formulations that promise to protect a prized possession—one’s appearance—are always in demand.

  • Anti-Aging Moisturization

    Anti-Aging Moisturization

    Dr. Stefan Banziger, Dr. Stefan Hettwer, Brigit Suter, Barbara Obermayer, Rahn AG, Zurich, Switzerland||May 1, 2015
    Researchers at Rahn develop a symbiotic moisture concept from lichen, moss and fern that hydrates the skin.

  • A Multifunctional Ingredient for Delicate Eye Contour

    A Multifunctional Ingredient for Delicate Eye Contour

    Julia Comas, Cristina Davi, Elena Canadas, Albert Soley, Raquel Delgado , Lipotec SAU||May 1, 2015
    Lipotec’s Eyedeline marine ingredient provides several benefits for the delicate skin around the eyes. It reduces vascular pe

  • Yeah, But How Does It Make You Feel?

    Yeah, But How Does It Make You Feel?

    Imogen Matthews, In-Cosmetics||January 6, 2015
    An update on the growing importance of creating a sensory dimension in cosmetics and toiletries.

  • New and Improved?

    New and Improved?

    Melissa Meisel , Associate Editor||January 6, 2015
    Emerging skin care brands manage to find their way in an increasingly competitive marketplace.

  • Think Differently

    Think Differently

    Tom Branna , Editorial Director||January 6, 2015
    The 2014 Annual Meeting of the Society of Cosmetic Chemists attracted the largest crowd in years.

  • Left to Their Own Devices

    Left to Their Own Devices

    Imogen Matthews, In-Cosmetics||November 3, 2014
    Demand for mechanical gadgets of all types continues to grow in the global personal care market.

  • Never Ending Journey

    Never Ending Journey

    Melissa Meisel and Christine Esposito , Associate Editors||November 3, 2014
    Sustainability is the present and future of household and personal care packaging.

  • How Now, Kao?

    How Now, Kao?

    Tom Branna, Editorial Director||November 3, 2014
    The multinational consumer product giant is bringing its extensive product line to consumers around the world.

  • The Face of Anti-Aging

    The Face of Anti-Aging

    October 2, 2014
    Here are scenes from Happi’s Anti-Aging Conference & Tabletop Exhibition, which was held last month in New Brunswick, NJ. The event attracted 300 attendees including suppliers, marketers, medical doctors and regulators.

  • Photo Finish

    Photo Finish

    Christine Esposito, Associate Editor||May 2, 2014
    The quest for a flawless, camera-ready face drives the skin care category.