Out Of My Mind On My Birthday

Out Of My Mind On My Birthday

If the 2020 election was held next week, who would you vote for?

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You know you are getting old as Jimmy Buffett says in one of his songs, “Girls start calling you sir,” and when you get cards that state there are too many candles to fit on top of the cake and even lewd cards like this one: The nurse is talking to an elderly couple and addresses the man, “The doctor would like a urine sample, stool sample and semen sample.” The man says “What does he want?” The wife answers, “Your underwear.” OK, love the happy birthday wishes but at the end of the day, it is just another day and I love quoting Buffett, “I’m getting older but never growing up.”

Loved the cookies that magically appeared today as well! Thank you to the mystery gift buyer!

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What category is bigger: Baby diapers or adult diapers? Good answer, adult diapers and growing past $10B a year. The biggest issue the product has: It’s name. Perhaps they can make birthday cards with them or start advertising during NFL games. Women actually have bigger needs for these than men, so perhaps give them away on the Ellen show. More joys of getting old.

My hip is doing great, thanks for asking.

Now that Coty has put most of the P&G brands it bought for $12B and OPI up for sale (now that is a big markdown), who is going to buy them? And with Revlon still for sale, what is that saying about the pro beauty business? Let’s see if private equity steps in or one of the large public companies like L’Oreal or Henkel.

Not a good day to be in the food delivery business. Grubhub wrote a 16-page letter to its shareholders explicitly stating they no longer had a competitive edge in the business. Everyone and anyone can deliver food from restaurants. Their stock plunged 40%. Even Amazon got out of the business. And what about Uber and Lyft? The entire WeWork story is something for TV. No wonder key brands are doing so well, makes perfect sense for LVMH to add Tiffany to their collection.

Speaking of TV, finished season 2 of Succession, one of the best series ever. Now watching The Loudest Voice on Showtime, the true story about Roger Ailes life who started Fox News with Robert Murdoch. Utterly fascinating.

Consumer spending is targeted at $1456 this holiday season, about a 5-6% increase over last year. What holiday gift do you want this year? For me the new Apple Pro Ear Pods are it, matching Midnight Green for my iPhone. Have to get them now!

Barron’s magazine came out with its 2020 predictions and among them, who is going to be our next president. In a landslide, they forecast Elizabeth Warren to win the Democratic nomination and Trump to win another term by more than a 2 to 1 margin. And that is with half the USA favoring Trump being impeached. Even the NY Times who wants Trump impeached perhaps more than CNN is learning the tricks of the trade Trump has used his entire life will delay or avoid this altogether. Utterly fascinating and we’re living the moment.

Sorry but have to brag about the best powder dipping system out there and its EMMA ZIP DIP. Nothing like it  with the most amazing odorless glue system and ultra fine powders. Everyone is loving it!

Last parting shot about getting “older:” You go to the mall and nothing in the stores excite you anymore. No wonder advertisers seek those 18-49 years old.

Happy Tuesday!

Amazon Enters Pro Beauty Space

Which FANG company could you not live without?

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It’s official: Today, June 24, 2019, Amazon.com entered the professional beauty space and is now selling to licensed salon professionals through their Amazon Business platform. To get pro pricing, you have to belong to Amazon Business and submit your license. No doubt they will manually verify each and every application and most likely, have already established ties to each state government cosmetology body. No one does business like Amazon.

The good, bad and the ugly.

But before I go there, today’s announcement is years in the making and I predicted this day nearly ten years ago. I recall vividly having my annual vendors charity weekend in 2005 telling everyone they needed to have their goods on Amazon and if not, they would sell  your competitor’s brands. Everyone shook their head like I was on crack cocaine.

Amazon started to enter the pro industry with its Luxury Beauty platform. It signed up plenty of pro beauty companies along with consumer companies. Essie and Zoya were first to sign up for nails. Eventually CND, OPI, Moroccanoil, Redken, Oribe and 100’s of others would join. Interesting enough, Harlan Kirshner was the ring leader for Amazon getting pro beauty companies to sign up or lose out. Ironically, the pro beauty industry’s biggest rep who calls on SBH (Sally Beauty Holdings), Salon Centric and Ulta and makes $$$$ in commissions, played the Amazon side and got many companies to sign up. Harlan is one reason why we don’t see rep groups anymore.

With so many companies part of Luxury Beauty, Professional Beauty was the next step in Amazon’s dominance of all beauty. Today SBH stock is down more than 15% to a new low of $12.47 as I write this. Ulta is down too but that is because Ulta stock sellers don’t understand Ulta’s business strategy. Ulta will continue to best Amazon in beauty for many reasons, none of them part of this blog. But SBH like I have mentioned several times before is vulnerable, especially Cosmoprof because Amazon is focused on their best-selling brands: Redken, Wella and OPI.

OK, here is the GOOD of today’s announcement:

It’s done and now all the players can move on. Salons and spas have been buying on Amazon for years and really the only thing affected are retail and hair color products which will now be available at wholesale costs. Next week we will see what discounts are offered. What is also good is that Amazon is an open book, you can see their strategy right in front of you and you can either ignore it or take advantage of it. One thing is for certain: SBH is the most vulnerable beauty company right now.

The BAD of today’s announcement:

Amazon took the relationships of the pro beauty industry and said good-bye to them. Amazon bet big time the industry doesn’t need sales reps, education, trade shows, stores, sampling and demos. Just think of the savings. And if licensed professionals like it this way, bad news for reps and stores.

The UGLY of today’s announcement:

If you think about it the pro beauty business is only 40 years old and how fitting for Amazon to announce in 2019, nearly 40 years to the day when Matrix and Paul Mitchell started. In retrospect, that is an awfully short time for an industry to come and go and that is ugly. Right now Paul Mitchell is not part of the Amazon story and is arguably the largest pro hair care company left (and still independent). Will it become “us vs. them” mentality? In the end, Amazon wins on convenience and next day shipping (they are testing two hour delivery in Denver and other key cities). Coty went all in and soon we will see what that decision means for the rest of the industry.

Bottom line: Business as usual. Coty and L’Oreal will ship a few more goods to Amazon’s DC’s and fewer goods to SBH’s DC. But in the end, overall usage of pro beauty products doesn’t change and since Amazon Pro Beauty is only good for licensed individuals, Ulta will continue to gain overall market share.

Happy Monday! 

Out Of My Mind On A Monday Mornin’

47 million turkeys were sold for Thanksgiving. Will you buy one next year?

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Wow, what a Thanksgiving weekend. Two sons, their wives, three grandkids made for an eventful time indeed. What memories forget or don’t include: Countless water bottles, some with two sips, some half-empty and some empty, none put in the garbage can; coffee cups some half-full, some empty, scattered wherever; empty toilet paper rolls and Kleenex boxes; laundry machine non-stop; empty bourbon bottles that magically emptied; toys everywhere, most used once; and let’s not even talk about the fridge. Worse culprits: Not the grandkids, but the adults!

We also decided this was the end of turkey, stuffing and veggies no one wants to eat. Friday and Saturday no one wanted leftovers and by the time we got to them on Sunday, neither did we. Oh well, a new tradition will start in 2019.

Sorry but it’s tough to be a state of MI sports fan. The Lions proved inept against the Bears and the Wolverines were embarrassed playing the BIG GAME. Worst loss in Wolverine’s history against OSU. Spartans barely won but I was rooting for Rutgers. Going downtown for the worthless and useless bowl game is so much closer. As they say, at least there is basketball. . . .

Conde Nast, publisher of many magazines including Allure, Vogue and Vanity Fair decided to stop publishing Glamour and keep it online only. Glamour was a top 5 magazine back in the day. Millennial’s, X, Y, and Z’s no longer look to magazines to make their beauty decisions, it’s all about Instagram.

CND’s Vinylux is the latest pro brand to go retail. Huge in-line displays at CVS and other retailers.

Black Friday, Cyber Monday and iPhones. What do they all have in common? Give 25%, 50% and even 75% discounts, and consumers will buy now versus later. Apple recently announced its worst sales of its flagship product in history and only through huge incentives can they move their new XR models. I was at Dick’s on Friday, the entire store was 25% off. They had customers but even at 25% off, it wasn’t a big deal. The other thing is, what happens when you go to mall and don’t find anything to buy? This increasing phenomenon is very scary as the generations I mentioned earlier are more interested in experiences than products. And what is one of the most popular Christmas songs ever? “All I want for Christmas is you.”

Coty has a new CEO and Sennen Pamich, formerly of Revlon, is now an executive. Coty hasn’t made money in more than two years, has $7B in debt and it’s stock is at an all-time low. Can Coty be turned around as P&G unloaded an overpriced asset or will the Clairol/Wella deal prove to be too much?

GM is closing 5-7 factories and laying off more than 6,000 workers; Ford stopped making sedans; Nissan CEO accused of tax fraud in Japan and is in jail. Carlos Ghosn is out at Nissan, Mitsubishi and pending fate at Renault. This while Jeep unveils its first pickup truck since 1992.

Can someone tell me this: What happens when everything is delivered to your home or business within two hours? You know that is the way the world is going. Target is advertising same day delivery paying a fortune to use their stores as warehouses. Amazon already offers this service in many urban areas. But think about this, if the surviving retailers all offer free shipping and two hour service, what will the differentiators become?

Happy Monday!

Coty Brings Fresh Air to Pro Salon Business

How often do you use fragrance (perfume)?

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As expected, Coty bought OPI Monday making OPI perhaps the most valuable company in the history of the pro beauty industry. L’Oreal bought MATRIX and Redken for a mere percentage of what Coty paid for OPI.

Coty which owns Sally Hansen and Rimmel among its brands is also a worldwide leader in fragrances. The information below is from their website:

Today, Coty is the world’s largest fragrance company, and a global leader in the beauty industry. After more than one hundred years in the business, Coty continues to draw on the creative, entrepreneurial and visionary legacy of its founder and, more recently Bernd Beetz, Chief Executive Officer of Coty Inc. Both visionaries have dramatically shaped and re-shaped the future of the company and the beauty industry itself.

Less than a week of acquiring OPI, they also bought Philosophy, known for their holiday lotions and potions. Plus they announced they are making yet another acquisition. WOW is all I can say.

But in the meantime, OPI is the story of the year. In a press release sent by Coty and George Schaeffer, the common thread was “that if isn’t broken, then there is nothing to fix.” With that said, OPI will continue to be the industry leader in the pro nail category and the entire management team is staying on including George.

This is good news indeed. Coty already owns the majority of the nail business in mass retail and now they have the dominant position in professional salons and spas. They have the vision and celebrity names to make OPI even a bigger player and surely they paid a premium knowing what an asset they bought.

The bottom line is that it’s business as usual. With George and the management team staying on, we know the integrity and brand proposition will remain intact and Coty’s influence will only enhance it.

I’m excited and await the new opportunities. In the meantime, congratulations to George, Suzi and Miriam from taking a dental supply company into a global giant and selling to a company that understands their vision and will take it to the next level.

Happy Wednesday!

Out Of My Mind On A Monday Mornin’

Are you a Black Friday or Cyber Monday shopper?

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So happy to be back to work today. One can only take so many consecutive days of eating and drinking anything and everything.

It’s also nice to be back to work today since all the family members left yesterday. They devoured virtually everything in sight and then made a total mess throughout the house. You would not believe the places I found candy wrappers and pistachio nut shells.

OPI is in the news once again. The Wall St. Journal is stating that Coty is the buyer and the price is near $1 Billion. With OPI and Sally Hansen, Coty will own the nail market.

I also heard over the weekend Essie is hitting Walgreen’s the first of the year with a retail price of $8. At this point, any difference in Walgreen’s, Target or even Wal-Mart selling the brand if Ulta does?

MSU 11-1, beats Penn State at Penn State for the first time since 1965 AND is the only team to beat Wisconsin. Our reward? Thumbs down for the BCS games. Enough Mickey Mouse for the Spartan’s.

I was at Somerset Mall on Black Friday (most people don’t know why it’s called that but they know to wake up early to shop) and it was busy but not crazy busy. Except for the Apple store where there was standing room only.

If someone gave you $500 to spend, what would you buy? Girls would opt in for clothes and shoes while boys would opt in for electronics. Unisex choices include designer jeans and fragrance.

Question: If you were at work and your daughter or son called and said they needed you to bring home a red pencil for their homework assignment, would take one from the office or stop at Staples? More than 90% stated they would take one from the office in a major study.

Happy Monday!

Out Of My Mind On A Monday Mornin’

Are you a Black Friday or Cyber Monday shopper?

View Results

So happy to be back to work today. One can only take so many consecutive days of eating and drinking anything and everything.

It’s also nice to be back to work today since all the family members left yesterday. They devoured virtually everything in sight and then made a total mess throughout the house. You would not believe the places I found candy wrappers and pistachio nut shells.

OPI is in the news once again. The Wall St. Journal is stating that Coty is the buyer and the price is near $1 Billion. With OPI and Sally Hansen, Coty will own the nail market.

I also heard over the weekend Essie is hitting Walgreen’s the first of the year with a retail price of $8. At this point, any difference in Walgreen’s, Target or even Wal-Mart selling the brand if Ulta does?

MSU 11-1, beats Penn State at Penn State for the first time since 1965 AND is the only team to beat Wisconsin. Our reward? Thumbs down for the BCS games. Enough Mickey Mouse for the Spartan’s.

I was at Somerset Mall on Black Friday (most people don’t know why it’s called that but they know to wake up early to shop) and it was busy but not crazy busy. Except for the Apple store where there was standing room only.

If someone gave you $500 to spend, what would you buy? Girls would opt in for clothes and shoes while boys would opt in for electronics. Unisex choices include designer jeans and fragrance.

Question: If you were at work and your daughter or son called and said they needed you to bring home a red pencil for their homework assignment, would take one from the office or stop at Staples? More than 90% stated they would take one from the office in a major study.

Happy Monday!