One reason why OPI dominates the nail color market is because of their long term strategy. We all know about their crazy names and infinite color selections but we all don't know is how George brought innovation to the "pull" side of economics.
Nail color collections have been around forever. Just like spring and fall fashions, we can always look forward to spring and fall nail color collections. Back in the 90's when OPI was making its mark, George came up with the crazy idea of introducing his collections on a particular date.
His thinking was that all salons and consumers would be able to buy the collection on the same day throughout the US and that OPI along with its distributors would build demand up until the release date.
Do you remember Trivial Pursuit? Back when I was in retail, we were among the first stores to sell this game. We became one of the company's biggest single store sellers. Their follow-up Baby Boomer edition had a release date 3 months out. To create demand I took deposits so our customers could get the game the first day available. We sold more than 900 games!
For OPI, the strategy not only worked, but no one duplicated it. And let me tell you, the OPI Pre-Release Police were out watching to make sure no one sold a single bottle before pre-release.
Their latest collection, South Beach, had a release date of February 4. We booked well over 1000 orders and were ready to ship. But a funny thing happened along the way. One of OPI's major customers decided they weren't going to wait until then and decided they would start selling South Beach on Saturday. Apparently they wanted to create buzz before anyone else and didn't care about OPI's famed policy.
To OPI's credit, they got on the phone to all their distributors and told them to release on Saturday. Lucky for us we were prepared. Our collections have been shipped and beginning tomorrow, our 22 stores will have the collections and open stock ready to sell.
Yes desperate times call for desperate measures. But at what price? Rules are rules and we will see in 2009 how many rules hold up. I think this major retailer will find out the hard way about this one particular rule.