Sales: $1.9 billion.
Key Personnel: Christian Courtin-Clarins, president, supervisory board; Dr. Olivier Courtin-Clarins, managing director; Jonathan Zrihen, chief executive officer.
Major Products: Clarins, My Blend skin care, Mugler fragrances; Azzaro fragrances.
New Products: Clarins Extra-Firming Eye, Extra-Firming Phyto Serum, V-Shaping Facial Lift Serum, Wonder Perfect Mascara 4D, SPF compact, Ombre eyeshadows, My Clarins skin care; Azzaro Wanted Girl.
Comments: At press time, L’Oréal confirmed it has entered in exclusive negotiation with the Clarins Group in view to acquire Mugler and Azzaro. The acquisition under discussion will remain subject to consultation with employee representatives and the approval of the regulatory authorities. It should be completed in 2019, according to L’Oréal.
The purchase would cover Clarins’ fragrance and fashion division, which represents 26% of the group’s overall revenues, or €400 million out of a total of €1.6 billion recorded by the company last year. Three structures are therefore concerned: Clarins Fragrance Group (CFG), which is responsible for Mugler and Azzaro Perfumes, as well as certain Azzaro accessories, (leather, eyewear and watches); Thierry Mugler and its ready-to-wear businesses; and Strasbourg-based fragrance manufacturer Cosmeurop.
With the acquisition of Mugler’s ready-to-wear businesses, which has been led by American designer Casey Cadwallader since 2018, L’Oréal would also be taking its first steps into fashion.
As for the fragrance business, thanks to the global success of Mugler’s Angel and Alien, and Azzaro’s Homme, Chrome and Wanted, the two brands should boost L’Oréal’s already very dynamic luxury division, which currently boasts 22 labels, including four billionaire heavyweights: Lancôme, Yves Saint Laurent, Giorgio Armani and Kiehl’s. L’Oréal’s Luxe represents 34.8% of the French group’s revenues and saw a 14.4% increase in comparable sales in 2018, reporting revenues of about $10.9 billion, compared to the growth of 2.5% within L’Oréal’s consumer products division.
“The perfume category is at the heart of our global strategy for growth at L’Oréal Luxe. In this context, we would be thrilled to welcome Mugler and Azzaro: these signatures, with a long history in fashion and olfaction, would perfectly complete our portfolio of brands,” said L’Oréal Luxe President Cyril Chapuy in a release. The two brands would notably reinforce what the cosmetics giant describes on its website as a “portfolio of global brands—the richest and most diverse in the beauty industry.”
Thanks to luxury products and “active cosmetics,” the sales of which have exploded in China recently, L’Oréal saw its annual growth accelerate significantly in 2018, reporting its best performance since 2007.
For Clarins, “this project fulfils the Clarins Group’s ambition to ensure its Beauty business reaches its full potential, while entrusting the Mugler and Azzaro brands to global beauty leader L’Oréal,” as revealed by the company in a release.
It represents a decisive change in strategy at Clarins, which would be saying goodbye to its strongly competitive fragrance category, which is in sore need of significant investments, and refocusing on its namesake brand and its historic cosmetics business. In so doing, the company is seeking to accelerate its international expansion, particularly on China, as well as to invest in leadership talent for its makeup and self-care categories, and boost its digital and omnichannel transformation.
“We know that if the project goes through, our two brands will enjoy optimal conditions as part of L’Oréal Luxe, which will guarantee their future growth, benefiting our employees,” commented Christian and Olivier Courtin-Clarins, president of the supervisory board and managing director of the Clarins Group, respectively.
“We would thus be able to focus on ensuring our Beauty division reaches its full potential,” concluded the two sons of the company’s founder, Jacques Courtin-Clarins, who passed away in 2007.
In other news, Clarins hit the road this past March to showcase its new skin care line. The My Clarins Glow Trip mobile pop-up tour kicked off in Chicago on March 30 and traveled to universities and events nationwide through April 24. The tour showcased the launch of My Clarins, a new vegan range of eight skin care products. The pop-up featured immersive and multi-sensory experiences including an oxygen bar; edible mist that offers a taste of My Clarins’ fruit ingredients; and a prize wall. After Chicago, the mobile tour headed to Pennsylvania, Washington DC, New York City, Florida, Texas, California and Arizona.