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Social skills
The inside view on the international beauty industry
CONFIDENTIAL
The power of social media and the extent to which brands now
have to take their consumers’ opinion into account was
hammered home last week by make-up brand Urban Decay’s
decision to sell its products in China. The brand, which has
a strong cruelty-free stance, was criticized and condemned by
bloggers and Facebook fans as the move will mean compliance
with the Chinese product registration process, which could
involve testing on animals. The brand was quickly accused of
putting money-making in China over ethics and was given a
variety of new names by social media commentators including
“Urban Betrayal”, while many vowed they would never buy the products again.
Urban Decay sought to address its users’ anger by posting a statement explaining that it
was against the Chinese government’s position on animal testing and that it was launching
in China so it would be better able to campaign against the practice, rather doing so from
afar. This did little to convince the brand’s fans, and the company now plans to hold a web
chat with brand founder Wende Zomnir to respond to objections and answer questions.
All this may have done some damage to the brand, but Urban Decay should perhaps be
commended for its willingness to confront the barrage of negative comments head on
and its readiness to listen to objections, rather than just ignore what was being said—
a strategy that many a brand would have adopted a few years ago when consumer
dissatisfaction would not have gone viral and been limited to a few angry phone calls or
letters. But then again, perhaps it simply had no choice but to interact, given how powerful
social media has become.
In addition to the rise of social media, this incident also shows how global the industry
has really become and that brands can no longer just put on a good face at home while
straying from their principles in far-flung markets.
Oonagh Phillips
Editor in Chief
ophillips@bwconfidential.com
Inside
June 14-27, 2012 #56
The buzz 2
The essential news roundup
Netwatch 6
The beauty blog review
Interview 8
P&G regional director prestige Asia
Pacific Carla Liuni & gm global SK-II
Parinda Hasdarngkul
Insight 10
In-store multi-sensory marketing
Show review 13
TFWA Asia Pacific
Store visit 16
Marks & Spencer Your Beauty,
London
Meet the BW Confidential
team at:
l HBA Global Expo, New York, June 19-21
l Make Up in Paris, June 21-22

The buzz
CONFIDENTIAL
News roundup
Elizabeth Arden has acquired the fragrance licenses for
musicians Justin Bieber and Nicki Minaj from US-based
Give Back Brands. Singer Justin Bieber’s first scent Someday
(pictured) launched in spring 2011 and became the numberone
women’s fragrance launch in US department stores that
year, according to NPD. A second fragrance for Bieber will
launch this summer. The first Nicki Minaj fragrance will launch
this fall. The addition of the new two licenses comes barely a
week after Arden announced it would acquire the fragrance
licenses for the Ed Hardy, True Religion and BCBGMaxAzria brands from US-based
New Wave Fragrances. Both the Ed Hardy and True Religion fragrances launched
in 2008, while a BCBGMax-Azria fragrance was introduced to the US in 2011.
Make-up brand Urban Decay’s announcement that it is to begin selling its
products in China has seen an outcry from its consumers given the brand’s
anti-animal testing stance and China’s product registration process which
involves testing on animals. Urban Decay posted a statement on its Facebook
page saying that while the Chinese government reserves the right to conduct
animal testing on cosmetics before approval, the authorities have not told the
brand if they have exercised this right with their products. It sought to explain
that Urban Decay does not test on animals, but the Chinese government may
conduct such tests. The company added that the move to China could help
change the government’s stance on animal testing.
Amid falling profits and stagnating sales, Switzerland-based organic beauty
and pharmaceutical company Weleda has reorganized its management
structure. Corporate restructuring specialist Ralph Heinisch has been appointed
ceo, former director of the cosmetics business unit Andreas Sommer has been
named chief commercial officer and Samir Kedwani, who was director of
production and pharmaceutical processes, is now coo.
Former ceo Patrick Sirdey is joining the management board of Weleda France.
Weleda also announced that it would embark on a series of layoffs as part
of its cost-cutting measures. The company reported a loss after interest and
tax of €8.3m in 2011. In the first quarter of 2012, sales reached €84.8m,
an increase of 5% on the first quarter of 2011.
A study by French market research company Yuséo on how French consumers
perceived shopping on the websites of perfumery retailers Sephora,
Marionnaud and Nocibé found that in terms of product selection 76% of
Sephora shoppers were satisfied, while only 55% of Nocibé shoppers and 48%
of Marionnaud customers were happy with the choice of available products.
Customer service was appreciated by 32% of Marionnaud’s web clients, versus
25% for Nocibé and only 19% for Sephora. When it comes to fostering loyalty
among online shoppers, 35% of Marionnaud and Nocibé customers see quality
and reliable service as reasons to shop again at the sites, versus 24% for
Sephora. At Sephora, 55% of customers say they would return because they are
“sure to find what they are looking for”, while this number drops to 52% for
Nocibé and 46% for Marionnaud.
According to industry
sources, LVMH-owned beauty
retailer Sephora is said to
be gearing up to enter India
with two stores in the country
before the end of the year. It
is thought that the retailer’s
first doors will open in
Mumbai and Delhi. Sephora
would not comment or
confirm the news.
Swedish direct-sales
company Oriflame is
expanding in East Africa
through the acquisition of
its franchisee operations
in Kenya, Tanzania and
Uganda. The company
says the strategy is in line
with its plans to develop
cosmetics direct sales on the
African continent. The
operations will be run as
three separate entities
managed from Kenya.
French grocery operator
Système U has acquired
the 139 stores of beleaguered
German drugstore
operator Schlecker in
southern France. Schlecker
employs a staff of 750 in the
stores. Schlecker filed for
bankruptcy in January and
said that it would shutter
more than 2,000 of its
5,400 stores.
Beauty sampling subscription
service Glossybox launched
in the US in May, bringing
its presence to more than
15 countries. Glossybox
sells monthly sampling sets
of five products women.
www.bwconfidential.com - June 14-27, 2012 #56 - Page 2

The buzz
CONFIDENTIAL
News roundup
Shiseido is to combine back office functions for its prestige brands in the
US into a shared platform. The brands involved include Bare Escentuals, BPI
USA, Nars and Shiseido. The company is also to consolidate its US distribution
operations at its distribution center in Ohio, US, and will merge its US manufacturing
business into its Americas umbrella organization.
In line with these changes, the company announced that Pankaj Gupta, who
has been executive vice president finance and operations and cfo for Shiseido
Americas Corporation since September of last year, will now also become
regional cfo. Deanna Chechile, general counsel for Bare Escentuals, will now
also serve as regional head of legal and Ginger DeLeo has joined the company
as regional head of human resources.
The 10 th edition of luxury packaging trade show Luxe Pack New York saw visitor
numbers up by more than 10% over the previous year to reach 2,607. The show
welcomed 10 more exhibitors than last year’s edition, bringing the total to 141. “We
have more exhibitors this year, but we aim to keep the boutique-like atmosphere
and stay very selective,” comments Luxe Pack executive director Nathalie Grosdidier.
Exhibitors and visitors alike were largely positive, yet some suppliers said that the
economic situation continued to cast a pall on the sector. “In Europe we have seen a
slowdown in major launches and there are more initiatives using existing bottles and
glass. This year is relatively flat versus the stabilization that occurred in 2011. There is
still a concern over inventory levels across the supply chain. However, luxury remains
quite strong and we are positive for the future of this segment,” comments Bormioli
Luigi export sales director glass container division Marco Azzali. Seidel director of
customer relations Nancy Lamensdorf agrees: “Brands are now being more cautious
and we are seeing more demand for flanker products.”
Seen in show
• US-based packaging specialist MWV launched two new versions of its Melodie pump
at the show. Melodie Delicate features a soft-force actuator that provides a smooth,
even and fine mist spray, while the Melodie Forever pump offers a fine particle mist,
whose spray pattern forms a cloud, rather than a spritz and doesn’t make droplets.
• French supplier Aptar showcased Color Code, a 15ml plastic pump with multicolor
possibilities launching in June.
• French company Alkos showed its new lip products. Pep Up Your Lips is a pencil
that comes in plastic or wooden versions with a transparent formula that changes
color depending on the PH of the lips. Three options are available to suit clients from
mass, masstige and prestige. The company also showed Beautycare Balm Addict, a
lip balm that also reacts to PH levels, Jumbo Twist a retractable lipstick pencil in bright
colors and Day to Night Addict lip liner, which is said to provide long hold and no
color transfer.
• Neopac presented its Beauty Serum Dropper, which dispenses controlled drops of
product no matter how much pressure is applied when squeezing the tube. The
packaging comes in sizes between 3ml and 50ml with interchangeable caps and
decoration options. Neopac has also enriched its line of rollerball tubes with ball
heads made of stones including rose quartz, mountain crystal and ceramic.
• Germany-based Oeka Beauty launched its Diamond mascara brush, which features
a soft inner area to dispense the formula and stiff bristles on top, which are used to
shape the lashes.
Axel Dumas, currently managing
director of luxury group
Hermès International will
become co-ceo of Hermès
alongside current ceo
Patrick Thomas in June 2013.
Dumas is a sixth-generation
member of the Hermès family.
Despite the wealth of information
about products on
the internet, some 76% of
shoppers make their purchase
decision at the point-of-sale,
according to a study by retail
marketing company Popai.
The study also found that
shoppers take less time to
make their purchases and
also spend more than in
the past, and advises that
retailers do more to attract
consumers’ attention in-store.
Popai revealed that when
consumers were asked if they
remembered merchandising
units in the store they visited,
56% said they recalled that
displays that were gondolas
or island units.
The 17 th edition of the
China Beauty Expo trade
show, which took place
from May 4-6 welcomed
222,000 visitors. Of these,
69% hailed from Asia, 11%
from Europe and 11% from
North America. Some 5,500
exhibitors attended the
event, which included a
number of well-known
Western brands, such as
L’Oréal Paris, as well as
Asian groups like Japanese
player Kosé.
www.bwconfidential.com - June 14-27, 2012 #56 - Page 3

The buzz
CONFIDENTIAL
News roundup
Fragrance company BPI (Shiseido) is launching
a major new women’s fragrance with a youthful
appeal for its Issey Miyake brand. The new
fragrance, called Pleats Please, is inspired by the
Japanese designer’s fashion collection by the same
name. “Our ambition with Pleats Please is to
establish a second franchise alongside L’Eau
d’Issey. The L’Eau d’Issey line is now 20 years old
so we need to recruit new consumers,” BPI chairman
Rémy Gomez tells BW Confidential. The floral
juice, by Givaudan perfumer Aurélien Guichard,
features a top note of nashi fruit, a heart of fresh
peony and sweet pea and a base of cedar, patchouli,
vanilla and white musk. Issey Miyake
represents nearly 40% of BPI sales, according to the company. Pleats
Please is the brand’s fourth women’s fragrance in 22 years.
Pleats Please launches in France, Spain, Switzerland and Asia in July, with
a rollout to Japan, Italy and Germany in 2013. The advertising campaign
was shot by photographer Nick Knight.
Estée Lauder-owned beauty brand Clinique is entering the second stage
of the development of its Even Better skincare franchise with Even Better
Eyes Dark Circle Corrector. The product, which launches worldwide in
September and will retail for €39.50, was created to treat dark under-eye
circles, which Clinique claims is women’s number-one skincare concern
worldwide. The product contains blackberry root, green tea, milk protein
and caffeine extracts and also features Clinique’s Translucent Optics technology,
which has light reflective properties. According to Clinique France
managing director Franck Besnard, the investment behind Even Better
Eyes Dark Circle Corrector will be higher than that of Even Better Clinical
Dark Spot Corrector, the first item in the range, which launched in 2010.
“This is not a flanker, but a star product in the line,” notes Besnard. Also
joining the Even Better franchise in October is Dark Spot Correcting Hand
Cream, a cream with SPF 15 protection, (€39), while August will see
the launch of a new product to camouflage dark spots, Even Better
Concealer, which comes in four shades (€25).
Lancôme is to launch a new fragrance called La Vie est Belle
in August. The launch is described as a “feminine iris gourmand
scent” and was composed by Anne Flipo, Olivier Polge and
Dominique Ropion of IFF. The company says the number of
fragrance ingredients was kept to a minimum (63 ingredients were
used) and that 50% of them are natural. The fragrance comes in
a bottle inspired by a flacon created by Lancôme’s artistic designer
in 1949. The scent will be backed by a TV and press ad campaign
fronted by actress and Lancôme spokesperson Julia Roberts. It will
come in 30ml (retailing for €52), 50ml (€76) and 75ml (€95).
Fashion designer Karl
Lagerfeld is to create a
make-up collection for
L’Oréal-owned Shu Uemura
for the upcoming holiday
season and launching
in November.
L’Oréal Luxe has named
actress Jessica Chastain as
spokeswoman for the new
Yves Saint Laurent women’s
fragrance, Manifesto. The
new Manifesto scent is slated
to launch later this year.
L’Oréal Paris is opening
a temporary nail bar in the
lobby of the Hotel Martinez
in Cannes, France. The nail
services are free of charge
for hotel guests and for
clients of the hotel’s
restaurants. The nail bar
will be open throughout the
month of July and will offer
51 shades of nail polish.
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www.bwconfidential.com - June 14-27, 2012 #56 - Page 4

The buzz
Wellness focus
Paris-based spa operator Thémaé president & co-founder Guillaume Lefèvre
How is the European day spa market performing?
The market has been quite difficult due to the economy and a lot of projects have been either postponed
or shelved; we’ve seen many spas go out of business due to overly ambitious projects. Several
years ago there was a flurry of spa openings and operators assumed that with some nice decorative
touches and a couple of massage tables, the customers would flood in. However, there often wasn’t
the notion of quality to back up these concepts, and no long-term vision. Spas have to offer creative
and qualitative treatments to stand out from the competition, especially during a crisis period.
We opened our first spa in Paris in 2007 in the middle of the recession, so the timing couldn’t have
been worse, but due to our unique concept [all treatments and products are based on tea] and focus
on high-quality service, we have succeeded in developing our day spa in hotel spas worldwide.
How do you recruit new and loyal consumers?
Word of mouth is the best form of communication as it is based on what the client has experienced in the spa. For an
upscale spa, the price of treatments also needs to be justified, and not heavily discounted.
How are discounting sites, such as Groupon, impacting the business?
This is not an approach that a spa should take to develop its business as it is very much based on short-term results. These
kinds of promotions can bring additional cash, but the margin is left by the wayside. Offering large discounts also means
that a spa has to cut down its labor costs, but if you reduce your staff’s pay you are also lowering the quality of the services
provided. The consumers that buy into this kind of promotion also tend not to be loyal, and as a spa operator I want to
build a long-term relationship with my clients.
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Netwatch
CONFIDENTIAL
Beauty blogger review
The products they’re talking about
The product: Skin Authority Sunscreen Moisturizer. This product from US-based company
Skin Authority claims to provide powerful sun protection in a lightweight formula that can be used as
a moisturizer and under make-up. This blogger reports that although the cream looks thick and white
like a typical sunscreen, it is easy to apply and absorbs quickly into the skin. She adds that it doesn’t
leave a tacky residue and that the skin feels mat and powdery after use.
[From: http://www.15minutebeauty.com/ ]
The product: IT Cosmetics Vitality Lip Flush 4-in-1 Reviver. This lipstick
from US-based IT Cosmetics (Innovative Technology Cosmetics) claims to have
been developed in conjunction with plastic surgeons to produce a multi-functional
product. It is described as an anti-aging lip balm, lipstick, lip gloss and lip stain, and
claims to deliver the hydration of a balm with long-lasting glossy color.
[From: http://www.beautifulmakeupsearch.com ]
The product: Manic Panic Radioactive Lip Gloss. The gloss from this make-
up brand is liked for its packaging, which has a mirror on the tube and a light that
switches on when the cap it opened. It is also said to be well-pigmented and have
a very glossy finish. The blogger says she was pleased to find out that the brand is
cruelty free and vegan.
[From: http://eyeshadowcult.com ]
The product: Alima Pure Satin Matte Foundation. US-based
brand Alima Pure’s positioning is that cosmetics don’t need a lot
of ingredients and that it leaves out substances that are perceived
as harmful. The brand is liked by this blogger for its natural mineral
make-up and describes the Pure Satin Matte Foundation as a
“second skin”.
[From: http://www.beautyandfashiontech.com/ ]
Their comments & conversations
l Bloggers often cover some of the more unusual ingredients and beauty products on the market.
Some of those under discussion recently have included: soaps made from breast milk, perfume with a
bacon scent, hair conditioner containing bull sperm and skincare made from animal placenta or bird
droppings.
l There are more frequent discussions on the blogosphere about brands that are not only natural, but
vegan, gluten-free and cruelty free. One blogger says that most lipsticks contain wheat and that
companies are now catering to those suffering from wheat allergies by offering gluten-free products.
Cruelty-free also continues to be a big issue and there was much disappointment from bloggers about
Urban Decay’s decision to move into China, given that that the market’s registration process has
animal testing requirements.
www.bwconfidential.com - June 14-27, 2012 #56 - Page 6
The views expressed in this section are those of bloggers and do not represent
the opinions of BW Confidential

www.makeup-in-paris.com
Carrousel du Louvre
21-22|06|12

Interview
CONFIDENTIAL
P&G regional director prestige Asia Pacific
Carla Liuni & gm global SK-II Parinda Hasdarngkul
Asia advancement
P&G regional director prestige Asia Pacific Carla Liuni and
Parinda Hasdarngkul, general manager global SK-II, talk about
the development of the fragrance market in Asia and the next steps
for prestige brand SK-II in the region
P&G recently announced that it will move its beauty headquarters to
Singapore. What impact will this have?
CL: Global Prestige was the first beauty unit to have its headquarters in Singapore. We
moved our base to Asia in June 2011 to meet the growing demand for prestige beauty,
led by the prestige skincare division. For travel retail in Asia, we are looking to expand in
key markets that have been growing steadily such as China, Hong Kong and Thailand.
Which fragrance brands are you focusing on for Asia?
CL: Beauty & Grooming continues to be one of the big focus areas in P&G [and the division]
contributed 33% of net sales. Within Beauty & Grooming, prestige is an important
and growing segment. The prestige category globally is 30% of the world’s spend on
beauty overall, totaling more than $90bn and growing 5% each year—this makes the
prestige category a very attractive one in which to compete.
This year we are seeing continued growth in key Asian fragrance markets. We have seen
double-digit growth on Dolce & Gabbana with Light Blue and The One; Hugo Boss with
Boss Orange, Hugo Just Different and Boss Bottled Night and Gucci has grown high
double digits this year over a year ago fueled by Gucci Guilty and Gucci Flora Garden.
What are the difficulties of building fragrance-only brands in China?
CL: Our key challenge is the comparatively low fragrance category development in China.
Today, less than 1% of the population uses fragrances compared to more than 60% for
Western Europe or the US. But branding is the number-one decision driver for Chinese
consumers when purchasing fragrance. They also have a strong desire to learn about
fragrance, which is why we build in category education into every communication
vehicle—PR, marketing and in-store counseling.
Another challenge is to provide a prestigious shopping experience across China’s large
geography. By prioritizing our resources in the right channels and right doors we strive to
get the best available location and create prestigious shopping experiences.
How do you see the development of the fragrance market in China ?
CL: Fragrance is a rather under-developed category in China; however it is growing in
the double digits. We see growing interest from consumers, especially the younger ones.
Gifting remains a key driver, but we also see more consumers buying for themselves.
Providing the right visibility for fragrances [in-store] greatly impacts sales as the category
is very impulse-driven. n n n
s Carla Luini (top) and
Parinda Hasdarngkul (bottom)
P&G Prestige
Asia-Pacific
l Fragrance bestsellers:
D&G Light Blue & The One;
Hugo Boss, Boss Orange, Hugo
Just Different, Boss Bottled
Night; Gucci Gucci Guilty, Gucci
Flora Garden collection
l SK-II sales:
$1bn (40-50% done in Japan)
www.bwconfidential.com - June 14-27, 2012 #56 - Page 8

Interview
CONFIDENTIAL
P&G regional director prestige Asia Pacific
Carla Liuni & gm global SK-II Parinda Hasdarngkul
n n n How do you see distribution evolving in China?
CL: The booming growth in China has presented a myriad of distribution opportunities
for us and our business is growing across all channels. Department stores, high-end
cosmetics stores and domestic travel retail will remain our focus as they offer a shopping
environment that is in line with what consumers expect from luxury beauty. The newcomers
are shopping malls, which have taken a prominent position in tier-one cities; this
trend will likely continue to tier-two and tier-three cities in the near future.
There have been worries over slowing growth in China and increasing costs
of doing business. How will this impact P&G and beauty in general?
CL: Growth rates will most likely slightly slow down in China as the market matures.
However, this does not mean no growth. The cost of doing business has increased
recently, but on the other hand there is an increase in local purchasing power.
How will you grow SK-II outside of Japan?
PH: The emergence of the global customer—especially in travel retail—has unearthed
immense potential for the development of SK-II outside Japan. We also see more travelers
from Asia and Latin America. SK-II has been a prestige skincare leader in Asia for over 12
months now due in part to our investment to build and grow classics, such as SK-II Facial
Treatment Essence, as well as new innovations. SK-II travel retail has continued to
accelerate the expansion in major airports like Shanghai and Beijing, after a successful
move into China in 2011.
What have been the first results of the men’s range and the new color line
for SK-II?
PH: In Korea, the Facial Treatment Essence for men sold out with the first few days of its
launch. We are now looking to expand the SK-II Men range in other markets. The Colour
Collection launched last year in Japan, and
the initial results are very good and we will
look for opportunities to expand it into other
markets.
How can you boost the SK-II brand
in China?
PH: We have achieved great growth with our
Facial Treatment Essence. Through our pool
of loyal users and celebrity ambassadors such
as Cate Blanchett and Tang Wei, we will try to
amplify SK-II’s reach. Besides the opportunities
in domestic, travel retail is seeing the fastest
growth in Asia, followed by the US, Latin
America and the Middle East. Airports are investing
in bigger and better shopping environments.
In the next 10 years, we expect over
130 new airports to be built in India and China. n
“ The industry has seen
the emergence of the
global customer—
especially in travel
retail—which has
unearthed immense
potential for the
development of SK-II
outside Japan. We also
see the changing face
in terms of the footprint
of global travelers, with
more travelers from Asia
and Latin America
”
P&G general manager global
SK-II Parinda Hasdarngkul
s P&G’s fragrance business in Asia benefits from recognizable
fashion brand names, such as Dolce & Gabbana and Gucci.
The group is making a major push with SK-II in Asia, especially
in travel retail
www.bwconfidential.com - June 14-27, 2012 #56 - Page 9

Insight
CONFIDENTIAL
In-store multi-sensory marketing
Tapping into the senses
BW Confidential reviews innovations in multi-sensory marketing
that could change the way consumers experience fragrance and
skincare in-store
Brands could do more to include olfactory and tactile components in their
in-store marketing to better stand out from the crowd. This is especially true given
the number of brands competing for shoppers’ attention in-store and the better multisensory
technology now on offer. “Brands need to be aware of the importance and
the potential of the olfactory experience at the pos as a means of communication.
Although there is more interest today, olfaction remains underexploited in this
market,” comments olfactory technology company Olfact’air ceo Maxime Caffon.
One of the biggest stumbling blocks for brands is the question of return on investment
for this type of operation. “Brand managers say that if they don’t do pointof-sale
animations they will disappear from the store in a few years, but if they do
have animations they don’t know what it brings in terms of sales,” explains French
fragrance technology company Scentys ceo Clément Jeanjean. This also goes for
multi-sensory operations. Olfactory marketing specialist Aeryum ceo Nicolas Chabot
comments: “Quantifying the ROI of this kind of operation puts a brake on its
development. Sure, these operations are meant to generate more impact, traffic
and sales, but it’s tough to measure. Once it becomes possible to gauge the
impact on sales, these operations will become an integral part of a brand’s
marketing strategy.”
On the up side, however, multi-sensory operations can be far cheaper than
traditional communication, such as advertising or in-store brand demonstrations.
“The creation of an olfactory experience is in no way a hindrance in terms of a brand’s
budget, even for a niche player; it remains very accessible,” says Chabot. This at least
should bode well for the growth of multi-sensory marketing initiatives. n n n
“ [Multi-sensory]
marketing operations
are meant to generate
more impact, traffic and
therefore sales, but it’s
tough to measure. Once
it becomes possible to
gauge the impact on
sales, these kinds of
operations will become an
integral part of a brand’s
animation strategy
”
Aeryum ceo Nicolas Chabot
www.bwconfidential.com - June 14-27, 2012 #56 - Page 10

Insight
CONFIDENTIAL
In-store multi-sensory marketing
n n n Sensory case studies
Parapharmacy podium
Aeryum is currently testing an olfactory merchandising concept in a select
number of parapharmacies in France in partnership with a major cosmetics
group. The concept is essentially a column that can house several products and
diffuses a desired scent, either of one product or a specific note. This diffusion
range can be either short (for in-store animation) or long for outdoors. “The
product we are currently testing has a strong olfactory signature and a highly
sensorial facet,” explains Nicolas Chabot, ceo of Aeryum, which created the
column. The column is magnetic so that the brand’s visuals can be easily
changed. The company has also created a “multi-sensory collective”
called Noise/Nose, which groups together experts in sound, visual identity,
promotional products and olfactory ambience to offer brands a communication
system that speaks to all the senses.
Marionnaud’s ScentLab
In May, French retailer Marionnaud began testing a new multi-sensory touch
screen in five stores. The application, called ScentLab is meant to tap into four
senses: touch, hearing, smell and sight. The screen features a test that asks the
shopper five questions related to her lifestyle, which then generate a suggested
fragrance. After helping the shopper complete the questionnaire, the BA can
show advertising visuals and films and provide samples of the suggested fragrance,
creating what Marionnaud sees as a well-rounded sensory experience.
“With ScentLab we have tapped into the consumer’s tactile, visual, emotional
and olfactory territory. We bring a new way to access fragrance and the
discovery of a novel olfactory experience to the sales floor, while the brands
gain a new means of communication in addition to their presence on-shelf,”
explains Marionnaud France marketing director Fabrice Obenans. He adds:
“This application not only brings more content to the fragrance experience, but
it gives the beauty advisor a new way to relate to her consumer.” During the
test phase for the ScentLab Marionnaud has partnered with fragrance brands
from L’Oréal group, but if the concept rolls out to more stores, other brands
may join; the offer can be personalized depending on the store’s location.
JC Decaux bus stop promotion
French fragrance technology company Scentys created a series of fragrance
promotions at bus stops in Paris in partnership with L’Oréal-owned Lancôme
and outdoor advertising company JC Decaux. For Lancôme’s Ô de l’Orangerie,
the bus stop showed the visual of the fragrance advertisement which featured
a panel that passers-by could press to release the fragrance. “This kind of
operation creates a strong memory link. The two-meter high poster combined
with the opportunity to experience the scent means that the next time the
consumer enters a perfumery chances are she will remember the experience
and will want to test the fragrance directly on her skin,” explains Scentys ceo
Clément Jeanjean. n n n
www.bwconfidential.com - June 14-27, 2012 #56 - Page 11

Insight
CONFIDENTIAL
In-store multi-sensory marketing
n n n Guerlain’s fragrance shower
At Guerlain’s shop-in-shop on the revamped beauty floor of
Paris department store Printemps, Scentys created a “fragrance
shower”—an area where consumers could stand as the scent of
Guerlain’s suncare products was diffused on demand. The technology
used was Scentys Box fragrance diffuser, which was positioned
a few meters above the floor. The ‘dry’ technology meant that the
fragrance was diffused without any ‘wet spray’ residue.
Scented items
French company Olfact’air specializes in the creation of scented promotional
items. “There is already a fragrance overload in the store so brands need
to work on media that are already scented—not those that need to be scented
on the sales floor. This is an interesting way to communicate as there is
both a visual and an olfactory impact. Thanks to microencapsulation technology,
it also means that the object stays scented for a long period of time;
some of our items from three years ago still hold their scent.
The consumer can also hold onto the item and share it with others, which
prolongs the duration of the operation,” explains Olfact’air ceo Maxime Caffon.
For example for the launch of Givenchy’s Play fragrance the
company created scented bracelets for use in-store. Olfact’air also created
scented envelopes for Lancôme, which the cashier uses to slip the sales receipt
into after purchase.
Nivea’s scent of the sun
Skincare brands, such as Nivea for its suncare line, are experimenting with
the diffusion of fragrance on store shelves. “The scent of a suncare product
has very positive associations—sea, sun, beach, relaxation—so by making
the scent a vector of communication we are creating a link with the hedonistic
aspect of the product and the context of use,” explains Scentys’ Jeanjean.
Localized sampling
Creating an olfactory experience in-store can be challenging given that
the air is often already saturated from the thousands of fragrances being
spritzed every day. But new ways of isolating the fragrance testing experience
are being devised. Scentys uses a technology that does not vaporize
the air with fragrance, but has a dry diffusion system so that shoppers can
smell several fragrances before testing them on their skin. “It’s a localized
experience; we don’t try to diffuse a scent at five or 10 meters so the client
makes a distinct association with the scent that she is smelling and the
product we are presenting,” explains Scentys’ Jeanjean. Merchandising
displays with integrated fragrance-infused polymer gel plaques also allow
the fragrance to be sampled within a small space, around 50 centimeters in
a type of ‘mini-island animation’. n
www.bwconfidential.com - June 14-27, 2012 #56 - Page 12

Show review
CONFIDENTIAL
TFWA Asia Pacific
Asia rising
BW Confidential reports on what was
seen and heard at the TFWA Asia Pacific
show held in Singapore from May 13-17
Exhibitors were almost unanimous in saying that this year’s TFWA Asia Pacific show
was a quality event. Organizer TFWA was also satisfied with the results and claimed
the 2012 edition broke records in terms of exhibition space, exhibitor and visitor numbers.
This year’s show saw the TFWA expand exhibition space beyond the main floor to a
mezzanine level just below it housing 17 companies. A total of 236 exhibitors attended
(up from 212 in 2011), and 58 (or 25%) were from the beauty industry. Visitor numbers
increased 2% to 2,164.
The numbers reflect the dynamism in Asia Pacific. Travel-retail sales in the region last
year overtook those in Europe at $15.9bn, with a growth rate of 24.7% (sales in Europe
came in at $15.57bn in 2011). Beauty sales in Asia Pacific were up 22.8% last year to
$4.72bn. According to Airports Council International (ACI), Asia Pacific will have the largest
share of global travelers by 2019 at 2.5 billion, or 33% of total passengers.
In addition to macro-economic growth, TFWA president Erik Juul-Mortensen outlined
in his address at the event’s opening conference that investment in airport infrastructure
would be key to future expansion in the region. He stated that in India the government
will invest $30bn in airport infrastructure in the next 10 years and that Vietnam was planning
new airport capacity for 250 million passengers.
The main driver however, remains the Chinese traveler. Some $3bn of tax-free purcha-
ses are now made by the Chinese. But despite the potential, Juul-Mortensen
noted that China and the Chinese traveler is a complex market.
“China needs to be treated as a collection of separate countries and the
industry needs to be clever to know what the Chinese want.” A similar
message applies to the Asia region as a whole: “The range of purchasing
patterns [in Asia] is more diverse than in Europe or the Americas […]
consumer behavior is the most difficult dynamic to understand and the
industry will need to work hard to convert consumers,”he stated.
While China was a major talking point, some exhibitors expressed
concern over a slight softness in the economy and the growing cost of
doing business in the market. There was also much frustration over the
difficult and ever-changing process of registering products in the market,
which continues to delay launches and result in a limited assortment in
China for many brands. And although China may still get the most attention,
there was a lot of excitement and interest about other markets in the
region, notably Indonesia, Vietnam and Cambodia. Myanmar, which is
now beginning to open up, was also highlighted as a market for the future.
As for India, it seemed more companies were beginning to consider
this market more seriously again—the country whose potential has been
talked about for years had taken a backseat recently at some of the major
brands, which were disappointed by the real growth to be had there and
preferred to focus on more immediate results in places like China. n n n
TFWA Asia Pacific snapshot
• Took place: May 13-17, Singapore
• No exhibitors: 236
• Beauty exhibitors: 58
• New or returning exhibitors: 62
• Visitors: 2,164, +2% vs 2011;
80% of visitors from Asia Pacific
Asia Pacific in figures
• Travel retail Asia Pacific sales 2011:
$15.9bn, +24.7% vs 2010 (global travel-
retail sales 2011: $46bn, +17.9% vs 2010)
• Beauty travel retail Asia Pacific sales
2011: $4.72bn, +22.8% vs 2010
• 60 million Chinese travelled abroad in 2011
• Chinese travelers purchased $3bn of
tax-free goods in 2011
• Asia Pacific will have the largest share of
global travelers by 2019 at 2.5 billion, or
33% of total passengers
Source: Generation, TFWA, ACI
www.bwconfidential.com - June 14-27, 2012 #56 - Page 13

Show review
CONFIDENTIAL
TFWA Asia Pacific
n n n Seen & heard in show
Pupa revealed it has just entered
Thailand with two counters at the
Paragon department stores in Bangkok.
It plans to be in six malls in the country
by the end of the year. The brand,
which has been cautious about
entering China, revealed that it is
now evaluating the market in a
more serious way.
French skincare brand Condensé
has opened an office in Hong Kong
to develop its Asian business and
to oversee its upcoming launch in
China. The brand will also launch
a website from its Hong Kong office.
German company Mäurer & Wirtz put
the focus on the men’s fashion brand
Baldessarini, whose license it took over
at the end of last year. The license was
previously held by P&G. The company
plans to launch a new fragrance for
Baldessarini in the fall. Mäurer & Wirtz
recently restructured its business into
three divisions: Beauty (for masstige
products) Prestige (for selective brands)
and 4711 (for the company’s 4711
cologne franchise). The company
plans to expand its prestige division and
will likely add more selective brands in
the near future.
French company VAG showcased
its new fragrance for fashion brand
Leonard. The fragrance, simply
called Leonard, is described as a new
signature scent and according to VAG
manager Anthony Gambirasio “marks
a change of mood for the brand”.
The floral oriental was created by
Delphine Lebeau and Benoist Lapouza
of Fragrance Resources. The fragrance
will roll out in September and comes
in 30ml, 50ml and 100ml. n n n
China Revisited: heard at TFWA’s China workshop
Travel retailer China Duty Free Group (CDFG) vp Charles Chen
outlined that:
• Its duty-free store in Sanya on Hainan island, China, which was completed
in 2010 reported sales of just under $250m in one year.
• The number of young consumers is increasing and that purchases by 18-30
year olds accounted for 40% of total sales at the Sanya store.
• Some 67% of growth in luxury-goods sales was attributed to new customers
mainly in second- and third-tier cities, and that brand awareness among
these consumers is now equal to that of consumers in first-tier cities.
• Brands should increase inventory of their best-sellers, provide more after-
sales services and staff training.
(CDFG has more than 190 outlets in China, Hong Kong and Taiwan and reported sales of
$660m in 2011, an increase of 43.6% over 2010)
Counter Intelligence Retail md Garry Stasiulevicuis on the
Chinese traveler:
• Some 72 new airports will be built in China by 2015
• Chinese travelers draw up a shopping list prior to travelling and will save up
to shop before travelling
• Request purchasing is key behavior among the Chinese
• Some 40% of Chinese travelers enter duty-free stores
• Some 30% of those entering a duty-free store make a purchase, but 30%
say they will never make a purchase
• One third of Chinese shoppers go to duty-free stores to browse or kill time,
25% look for a bargain, and 20% go to buy a specific item
• Chinese travelers’ average spend is $170, versus a global average of $100
• Chinese business travelers’ average duty-free spend is $155, those on organized
leisure trips spend $210 and solo leisure travelers spend $180
• In beauty, business travelers spend an average of $210, those on organized
trips spend $245 and those traveling for leisure, but not in groups spend $225
• In the beauty category, 30% plan to buy a specific beauty item
• In beauty, the conversion rate is 40%
• Some 55% of shoppers who buy beauty say they purchase for a gift and
40% buy to stock up their beauty supplies
• In beauty, of those who planned to buy but did not make a purchase, 50%
say it was because items were too expensive and 50% were not inspired
CAPA coo Derek Sadubin revealed that:
• The development of high-speed rail in China will force airlines to expand
into other markets either domestically in the country or in South East Asia.
Sadubin described high-speed rail in China as a “retail free zone”, and
said there is an opportunity to develop sales in rail stations.
• Middle East carriers routes to China are growing rapidly.
• Much of the growth in China will be driven by expansion of low-cost carriers
(LCCs)
www.bwconfidential.com - June 14-27, 2012 #56 - Page 14

Show review
CONFIDENTIAL
TFWA Asia Pacific
n n n Salvatore Ferragamo Parfums continues to invest heavily in media and
counters in China and will launch a TV ad campaign in the country for its Attimo L’Eau
Florale fragrance this month. “This campaign will target 150 million consumers in
Shanghai, Beijing and Guangzhou. Our TV advertising in China generates an immediate
boost in sales. We have a three-year plan for TV in the country,” says Salvatore
Ferragamo Parfums ceo Luciano Bertinelli. The company will also launch a TV campaign
for its Signorina fragrance in China in 2013. The fragrance has launched in
Europe, Russia and the Middle East and based on these results the company has raised
its targets for the scent in China. Ferragamo is also opening more in stores in China
and is in expanding in second-tier cities there. China is now its third-largest market and
is tipped to become its second most important country in the near future.
French company Interparfums is to open a 50-60m 2 beauty space in the new
Burberry fashion store due to open in Hong Kong in July. This will be the brand’s
second beauty space to open in a Burberry store–its first was a make-up counter in the
brand’s boutique in Taipei, Taiwan, which opened two months ago. Interparfums Asia
Pacific md Renaud Boisson says the launch of Burberry make-up has enhanced the
brand’s visibility and expanded its space in-store in Asia and especially in China, where
the retail real estate for fragrance is being increasingly impinged upon by new skincare
and cosmetics brands entering the country. Interparfums says Burberry is the third-
ranked fragrance brand in China and does €30m sales at retail there. The company
also has big expectations for its Montblanc fragrance franchise in China, for which it is
expanding distribution. Interparfums does €50m in sales for all its brands in China.
Swiss brand La Prairie showcased three new products in its Advanced Marine Biotechnology
line, which are positioned as an affordable, eco-luxury collection aimed at
younger consumers. The new line-up for men and women and due to launch this summer
comprises a cleanser retailing at €52, a moisturizer (€110) and an eye gel (€84). La Prairie
revealed that Asia has overtaken Europe as its biggest region in travel retail. “Growth
is coming from Asia and driven by the Chinese with Hong Kong, Macau, Singapore,
Thailand and Korea all going very strong,” says La Prairie business development manager
travel retail worldwide Katharina Walther. From 2013 the brand will put more focus on
duo packs to cater to Chinese travelers’ taste for sets and coffrets.
French company Millenium Fragrance, known for its children’s fragrances,
officially presented its new brand Kokeshi (pictured). The brand takes its inspiration
from Japanese dolls and comprises five fragrances: three for girls, two
for boys and a unisex item. The scents come in doll- shaped bottles, with each
design representing a different character. The company says that the range
has a “cuteness factor”, which will allow it to expand business to target
pre-teens and adolescents. The 50ml EdTs will retail at €29.
Italian company Selectiva is rolling out its Pink Sugar Sparks fragrance
(pictured) in Asia. In the region, the company will move into Taiwan in
June 2013 and has begun the product registration process to launch in
China; last year the brand also launched in Indonesia. Export represents
40% of Selectiva’s sales and the company is aiming for a 50:50 split
www.bwconfidential.com - June 14-27, 2012 #56 - Page 15

Store visit
CONFIDENTIAL
New focus on beauty
Marks & Spencer inaugurates its new beauty concept
Marks & Spencer (M&S) is making beauty a new priority with the launch of Your Beauty -
The Best of Nature and Science, the UK retailer’s new cosmetics concept. The concept,
which launched at M&S’ Kensington High Street store in London in May and on its website,
focuses on an assortment of trendy, niche third-party brands, as well as the retailer’s privatelabel
lines. Third-party names include haircare brands Philip Kingsley and Tara Smith, skincare
from Dr Murad, Nuxe, Apivita and Filorga, Pur Minerals make-up and Acorelle, Comptoir Sud
Pacifique and Berdoues in fragrance. Nailcare brand Leighton Denny is launching exclusively
at Your Beauty.
Around half of the brands on offer will be M&S’ private-label lines, which are either new,
or have been repackaged and revamped, according to the retailer. The bulk of the ownbrand
offer is made up of skincare, bath and body brands, including Pure Skincare, a new
eco-friendly natural brand.
M&S has made service a focus at Your Beauty, in a bid to make the beauty shopping
experience “simple, fuss-free and enjoyable, with no hard sell”. All beauty advisors will
undergo training in skincare, haircare and make-up sales and will also be qualified to provide
make-up application and skincare analysis. The new space features a Virtual Makeover counter
where consumers can ‘try on’ different make-up looks and receive a skincare consultation
via either their photo or an on-screen model.
In the UK, the concept will bow in two stores this month and will gradually roll out to 100
stores by summer 2013. Internationally, Your Beauty will launch in Prague, Czech Republic
and in Poland next fall, with other stores to follow. n
Your Beauty
- The Best of
Nature and
Science
l Brand mix:
Around 50% M&S own
brands, 50% third-party
brands
l Special features:
Virtual Makeover counter,
skincare analysis,
make-up application
www.bwconfidential.com - June 14-27, 2012 #56 - Page 16

Store visit
CONFIDENTIAL
s The new concept features an even mix of Marks & Spencer’s private-label lines and third-party brands
s The beauty space was designed to make shopping simple and “fuss-free”
www.bwconfidential.com - June 14-27, 2012 #56 - Page 17

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