Out Of My Mind On A Thursday Mornin’

What are you doing for the July Fourth holiday?

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Yes, I am typing on my iMAC in my new office overlooking I-96. We are 80% done with the move with the rest coming over the next couple of days. Stupendous production.

I am dying to know the female voice used by OTIS elevators that announces which floor the elevator stops on. It is a very addicting voice.

What’s worse then when you are going 55-60mph with no one in front of you and suddenly someone turns into your lane slowly and then proceeds to go at least 5-10mph slower than the speed limit?

I am learning that there are people who love to eat outside on picnic tables and there are people who only like to eat inside in total comfort. Which type of people are you?

Darryl Mitchell, owner of Tammy Taylor, passed away earlier this month at the age of 71 due to cancer. Darryl was a scratch golfer, fierce competitor and helped to make Tammy Taylor a big name in acrylic nails.

With July 4 falling on a Wednesday this year, some people are taking off M-W and others W-F. How about you? For me, T-Th as we travel to Chicago to visit Carter and for the first time, all three kids at once.

Speaking of kids, Daniel starts his job at Sears Holding at the end of month. Congrats Daniel!

Google just announced its $199 tablet and they are taking orders. Will electronic retailers be around in the next couple of years? All the manufacturers are going direct. Bad news for Dell and HP.

THE BEAUTY BOOK 2012 Fall edition is at the printer and will be in the mail next week.

Rumor has it that we are going to be in Crain’s Business Detroit next issue.

All the rain in Florida, all the fire in Colorado. Nothing but sun and blue skies in Michigan. Love it.

Starbuck’s just opened its first tea only joint. Really? Who drinks tea unless they are sick?

It’s done. TIGI is no more as our stores wind down the remaining inventory on hand.

But we have no concerns as Moroccanoil is hot, hot, hot. If you haven’t seen the CNN segment that was featured last week, then here is your chance to view it.

Happy Thursday!

Out Of My Mind On A Thursday Mornin’

What are you doing for the July Fourth holiday?

View Results

Yes, I am typing on my iMAC in my new office overlooking I-96. We are 80% done with the move with the rest coming over the next couple of days. Stupendous production.

I am dying to know the female voice used by OTIS elevators that announces which floor the elevator stops on. It is a very addicting voice.

What’s worse then when you are going 55-60mph with no one in front of you and suddenly someone turns into your lane slowly and then proceeds to go at least 5-10mph slower than the speed limit?

I am learning that there are people who love to eat outside on picnic tables and there are people who only like to eat inside in total comfort. Which type of people are you?

Darryl Mitchell, owner of Tammy Taylor, passed away earlier this month at the age of 71 due to cancer. Darryl was a scratch golfer, fierce competitor and helped to make Tammy Taylor a big name in acrylic nails.

With July 4 falling on a Wednesday this year, some people are taking off M-W and others W-F. How about you? For me, T-Th as we travel to Chicago to visit Carter and for the first time, all three kids at once.

Speaking of kids, Daniel starts his job at Sears Holding at the end of month. Congrats Daniel!

Google just announced its $199 tablet and they are taking orders. Will electronic retailers be around in the next couple of years? All the manufacturers are going direct. Bad news for Dell and HP.

THE BEAUTY BOOK 2012 Fall edition is at the printer and will be in the mail next week.

Rumor has it that we are going to be in Crain’s Business Detroit next issue.

All the rain in Florida, all the fire in Colorado. Nothing but sun and blue skies in Michigan. Love it.

Starbuck’s just opened its first tea only joint. Really? Who drinks tea unless they are sick?

It’s done. TIGI is no more as our stores wind down the remaining inventory on hand.

But we have no concerns as Moroccanoil is hot, hot, hot. If you haven’t seen the CNN segment that was featured last week, then here is your chance to view it.

Happy Thursday!

ULTA Crushes Premier Orlando Show

ULTA Crushes Premier Orlando Show

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The professional beauty industry’s best trade show for salons is the Premier Beauty Show in Orlando. It is well organized, conveniently located in the Orange County Convention Center (the size of a small city) and they spend money on their main stage productions. We were excited to exhibit and launch the black 15in1 trade show booth. The bad news is they gave us the worse booth location in the show (the bathrooms would have been better). The good news is that those that found us loved us.

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Main stage differed this year than all other years as CND was the first nail company in the history of the Premier show to have a slot. Jan Arnold was sensational and brought along The Blondies (huge designers) that did all the model’s outfits. The 40 minutes presentation was amazing and we will get to see some of this live at Beauty Buzz coming up October 7 at the Motor City Casino Hotel Soundboard Lounge.

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Yes, Jan even had a guy wearing Shellac nails. Every outfit was designed around the nails. You have to see it to believe it. Plus they had two nail artists live on stage doing Shellac nail art, also very cool.

But even with all this, the show lacked its typical excitement. Attendance was down both days, however, most interesting was that none of the P&G brands were present. It’s like both P&G and L’Oreal are making a stand which trade shows they participate and support. So Wella, Nioxin, Sebastian and others were all missing. And even though L’Oreal was present, their booth space was not commanding as in years past. In fact, Redken didn’t even bring open stock items to the show. And as always, it is very difficult to compete with the flea markets throughout the show. Attendees waited in lines more than an hour just to get into the $1 bin areas.

While the Premier show was going on and remember, this is the best show of the year, ULTA announces its quarterly results. Same store sales up more than 10% and its stock zooms up nearly $10 a share to reach an all-time high. And what brands does ULTA sell? You can name them all (or pretty much all, they still don’t have Kerastase, Oribe, Moroccan Oil or even black 15in1). And while hairdressers are looking for bargains at the Premier show, consumers don’t have to pay $10 for parking, walk a mile to get into the show in 90+ degree heat, deal with suitcases and crowds or pay $40 to get in. They just need to walk into an ULTA store and get virtually every pro brand at huge discounts. Take a look at their latest offering:

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Over 35 brands. Take TIGI BED HEAD Hard Head spray for example. Salon retail is $18. Salon pays $9. ULTA pays around $4.50 and receives added discounts. Consumer buys 2 at $18 each for $36 and gets one free. That comes out to $12 a can. If the salon does that, they make $3 a can. They have to pay 10% commission on the $12 or $1.20 so their net profit is $1.80 a can. ULTA on the other hand makes $7.50 per can. It’s no wonder ULTA sales and profits are skyrocketing, who can compete?

The real industry trade show is now at ULTA’s 430+ stores and takes place daily, not on one selected weekend a year. Things are changing or shall I say, things have changed. No one does retail beauty better than ULTA. Now let’s get back to the business of the hairdresser and the future of salons. Let’s hope the Premier show can lead by example. Oh, a better booth location would be great too!

Happy Tuesday!

ULTA Plows Ahead Seeking Salon Product Domination

Which store is your favorite retail beauty store?

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Trade Secret had the opportunity and blew it. Beauty First thought they had the right idea but they didn’t. Sally thought about it but understood its market position and wisely maintained it.

ULTA on the other hand with the backbone of Lynn Kirby fought and fought in the same battlefield and came out the ultimate winner. First known as Ulta 3 when they started in 1990, ULTA now commands the market, has upwards of 450 stores and plans on adding another 550 over the next few years. Each store is 10,000 sq.ft. and offers a 950 sq. ft. salon for services. Read more about ULTA here.

It wasn’t too long ago that their stock was less than $10 a share. Today you can’t buy it for less than $75. So what is the compelling story that made ULTA succeed when so many of its contemporaries failed? Kirby understood consumers.

Think back to the late 70’s and early 80’s when the first real wave of retail salon products arrived. This was the period of Paul Mitchell, Matrix, Nexxus, Aveda, Redken so many other brands. These brands were developed by hairdressers and sold exclusively to local salons. It was the birth of salon retailing. Soon salons outside their local markets wanted the products and the expansion of full service distributors evolved. Those lucky enough at the time to land one of these brands was set for life. Nexxus distributors ended up owning private jets they made so much money with the brand. Distributors couldn’t hire enough salespeople and open stores fast enough to satisfy the demand. It was a feeding frenzy.

This drove other hairdressers to develop their own lines and we saw the likes of Sebastian, ARTec, and dozens others. Money and profits were free-flowing and the party was huge.

But alas in the 1990’s and early 2000’s, like so many other industries, greed and market domination took hold. But the overwhelming trend that no one spotted was that salons didn’t focus on retail products even with their monopolistic position. Sure they loved the brands they used but it wasn’t their focus to sell them. As manufacturer’s grew along with marketing and promotional campaigns, consumers demanded salon products more than ever. But they weren’t happy with their choices where to buy the brands they wanted since salons focused on the brands they wanted to carry instead of the brands consumers wanted them to carry.

Most likely this is what caused the beginning of diversion. Manufacturers said to themselves, “Hey, we got a huge market and we need to position our goods so consumers can buy our products.” Retailers such as Target, CVS and Walgreen’s craved salon products because consumers came into their stores looking for them. One innovative company understood all this and became the pioneer in the diversion movement and to this day, continues to be the leader (no, not ULTA). Diversion suddenly became a huge issue but the uncanny thing about this was that salons cared but they continued to carry the same brands that were diverted. As manufacturers learned this, they thought, “Heck, if salons complain but still carry my brand, why not continue?” And they did.

During all this, ULTA strategically decides upon its business model. Kirby learns from Trade Secrets that if we have a working salon in our retail space, we can sell EVERY professional brand to consumers that we want. Unlike salons who chose brands that they had to personally like to use or retail, ULTA knew firsthand that was nonsense. The only thing important to ULTA was to carry brands consumers wanted to buy. That was the thinking that changed everything.

Today while diversion is alive and well, it’s not the key subject in the industry. ULTA changed that.

Walk into an ULTA store today and you will be amazed at the number of professional brands they carry from hair care to nail care to appliance and everything in-between. They are now getting into “Sephora” type goods which will make them even more of a powerhouse. And with their superior marketing strategy including daily email blasts, discounts, loyalty programs, free shipping and much more, how will anyone compete with them moving forward?

Salons can no longer carry all the brands consumers want, there are too many and ULTA owns the market. Listed are some strategies salons have adopted:

  • Focus on services and maintain a non-commitment to retail
  • Focus on “exclusive” brands such as Kerastase, Bumble & Bumble, and Oribe
  • Focus on niche brands new to the marketplace not sold at ULTA

Believe it or not, even when ULTA does get to 1000 stores, they will only represent less than 1% of the salon universe. This suggests that salons still have a competitive advantage much like a locally owned restaurant has over a chain. But like the locally owned restaurants that compete with chains, even though the owner/chef may not eat burgers, fries and pizza, they know their customers can’t get enough of it. Salon owners as well will need to change their mindset and start offering brands that consumers want to buy regardless of what their likes or their stylists likes are.

Two brands that are perfect examples of this include Morocannoil and black 15in1. Morocannoil is not sold at ULTA. Demand from consumers is intense. Every smart and savvy salon using the new paradigm should sell Morocannoil and become a Moroccanoil Loyalty Salon. The opportunity for salon owners is limited and they must jump on the bandwagon when they can and cash in.

It took industry pioneers to launch salon retail products. It will take industry pioneers in 2012 to rethink salon retailing philosophy and in doing so, they too will make a killing. The landscape is set and ready for take-off.

Happy Thursday!

The Industry Source Launches Moroccanoil in Texas

The Industry Source Launches Moroccanoil in Texas

The Detroit Lions are 4-0 for the first time since 1980. Will they make the play-offs

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Every ten years, at least one brand in our industry makes it big. In 1980, we witnessed both Paul Mitchell and Matrix. In 1990 we witnessed ARTec. In 2000, we witnessed Pureology.

And most recently, the brand everyone is talking about is Moroccanoil. Moroccanoil has captured the hearts and souls of hairdressers and consumers like no other brand and its momentum continues to soar.

The Industry Source is very proud of its relationship with Moroccanoil and very excited to distribute the brand in the state of Texas through our Brand Ambassador’s and six store locations.

What we bring to Texas is Moroccanoil’s esteemed Loyalty Program and world class education. Salons are realizing record sales and profits along with the added benefit of being exclusive with the brand. That is because Moroccanoil only allows its products to be sold through authorized salons and spas, and never to retailers or chain accounts.

As a special kick-off, we are hosting a very exclusive launch tour featuring great education, models, food and drink and lots more. We will be in Austin on Sunday, November 13 and Dallas on Monday, November 14. We will also have a very special hands-on class at TheAcademy on Tuesday, November 15 for all our new Loyalty salons.

Indeed this is pure excitement. If you want to hop on board and be among the first Morocannoil Loyalty salons in Texas, give us a call right away. We have a limited number of openings available and like any hot brand, demand will exceed supply.

Put the power of Moroccanoil in your hands.

Happy Monday!

Cosmoprof NA 2011 Recap

Do you think the economy will double-dip into a recession?

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Between breakfast meetings at the Four Seasons, distributor meetings at The Hotel and Mandalay Bay, onsite meetings at the convention center and dinners at night, it was non-stop movement at Mandalay Bay for those lucky enough to endure yet another Cosmoprof. With more meetings off the show floor than in the history of the show, you would think the show organizers would make the show floor more affordable and bring everyone together. But not this group, they would rather have everyone suffer and pay the consequences.

The show floor itself was 75% nail, 15% hair and 10% everything else. Included in the mix was mostly Asian and European companies trying to get a foothold in the USA market along with the typical die hard USA companies such as Helen of Troy, Conair, Spilo and Tweezerman. There are now more nail gel companies than Starbucks has coffee combinations. One booth featured more than 300 colors. Another claimed 1000 colors. There was also no shortage of pedicure spas with each company offering virtually the same units.

The onsite meeting rooms were very scarce as well this year. L’Oreal was nowhere to be found and even TIGI opted off the floor as did Essie and so many others. In one very small secluded section one could find OPI, CND, Keratin Complex and Moroccanoil (which was perfect for me).

George and Bill were very proud showing off their new LED light made in the USA and made of heavy steel. The $399 light will be tightly allocated in 2011 and features quick curing and the ability to do both hands and feet. Looks like the first shipment of Gel Color will arrive late September but even that will be allocated until 2012.

CND was very happy as they shipped their 6 latest shades of Shellac (we have in stock!) and continue to expand the marketing reach of the brand. It will be interesting when CND meets OPI in 2012, sort of reminds me of the Wild, Wild West.

Moroccanoil spared no budget as they offered up lunch each day and imported chocolates from Israel with the MO logo. They also featured an event at MIX on Monday night, no doubt the biggest spender at the show this year.

I bumped into many people along the way, some of which I haven’t seen in a while. There was Bob Furstenberg still loving Oakland and fried chicken. There was Simon (ex-L’Oreal and TIGI) traveling from London representing ghd as they make their USA push. There was Paul Sharnsky, a.k.a. the distributor hanging out with anyone he could latch onto and enjoying an adult beverage at the MO party. There was Jeph Wright (ex Kemon coach) taking yet another cigarette and cocktail break with a fellow stylist at 7:15AM. There was Bo of Wahl playing Texas Hold Em’ and enjoying himself. There was Tony Cuccio (enough said). There was Michael and Zoya Reyzis dining at the Four Seasons (very nice people but did they have to have Leo?). There was MIke Asher flying first class as usual on DELTA also having breakfast at the Four Seasons with Tom Fowler, now of A.I.I. fame. Mike is another nice guy just not sure what his role is these days.

For me, the highlight of the show was meeting with distributors and seeing their faces when they saw the new black 15in1 products, Ginger Lily Farms Botanicals and new PR campaign for Kemon NaYo and Actyva Care. What is very refreshing and positive for our industry is that while a few global giants control the lion’s share, there are still plenty of good guys out there that are independent, like to have fun and want the latest and greatest. As one of them said to me, perhaps we should have our own Cosmoprof and forget all this BS we have to endure. Hmmm, sounds like a good idea to me.

Happy Thursday!