IBI/Shiseido Aura Science Investment Will Top $69 Mil. By 2003
This article was originally published in The Rose Sheet
Executive Summary
Intimate Brands and Shiseido jointly will invest $13 mil. in 2002 and $20 mil. in 2003 to transform the Aura Science specialty retail joint venture into a "major global brand," Aura Science Chief Financial Officer Jill Granoff said
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Intimate Brands and Shiseido jointly will invest $13 mil. in 2002 and $20 mil. in 2003 to transform the Aura Science specialty retail joint venture into a "major global brand," Aura Science Chief Financial Officer Jill Granoff said. The investment is on top of an initial capitalization of $9 mil. and an additional contribution of $27 mil. in 2001, Granoff added. Intimate Brands and Shiseido unveiled the first Aura Science retail store and more than 300-SKU product line at the Easton Town Center in Columbus, Ohio on April 12. "The combination of The Limited's excellence in retailing and brand management and Shiseido's expertise in product research and development has allowed us to set a new standard in beauty retailing," Intimate Beauty President and CEO Robin Burns said. The opening marks the culmination of four years of cultivation and development, she added. Intimate Brands and Shiseido announced their joint venture in 2000 (1 (Also see "Intimate Brands/Shiseido Joint Retail Stores Open Fall 2001" - HBW Insight, 18 Sep, 2000.), p. 3). Although the partners anticipate Aura Science eventually will become a 500-store retail network, 10 test doors are scheduled to open in 2002. Following Easton Town Center, two stores will open in Chicago in the spring followed by stores in New Jersey, Washington, D.C., Miami, Boca Raton, Fla. and Palm Beach, Fla., Burns said. In year two, approximately 25 Aura Science stores are slated to open followed by between 40 and 100 more in 2004, Burns added, noting the retail concept was developed to be a global brand. Aura Science is expected to become a $1 bil. business within four to five years, according to Exec VP and General Manager Lynn Emmolo. The first 10 free-standing, open-sell stores will range in size from 1,100 sq. ft.-2,000 sq. ft. as part of a "test to determine the optimal balance of store size and profitability," Granoff stated. Designed by architect David Collins, who created the revamped Victoria's Secret Beauty concept, the stores feature a white-on-white interior that radiates light and "brightens, energizes and invites," according to Burns. Customers will be greeted in-store with a warm hand towel to foster an "incredibly personal shopping experience," Emmolo said. Trained Aura Science specialists will then introduce customers to the product line, which is centered on skin care and complemented with color cosmetics and beauty accessories. The skin care emphasis allows the two firms to capitalize on the $5 bil. U.S. skin care category, Granoff said, pointing out that facial skin care is the fastest growing beauty category with "growth of 7% in 2001 versus 3% for the beauty market overall." The aura3system is the focal point of the skin care collection. The daily regimen features products to "cleanse, prep and hydrate" in four "SkinPhases" based on skin needs and formulated for three different skin types, Emmolo said. Aura Science specialists will help customers determine their skin phase by answering a series of seven questions using a touch-screen system. In addition to the basic skin care regimen, the 70-SKU skin care line includes Aura Science Pure for "sometimes sensitive skin" and Aura Science Special Needs, a line that address anti-aging, de-stressing and blemish control. The 240-SKU Aura Color line, developed with "luxurious textures and high-quality ingredients," includes foundations, powders and concealers, as well as color items for eyes, lips, cheeks and nails. Aura Luxuries is a line of beauty accessories. Product packaging is vibrant and colorful and coordinated by skin phase in shades of pink, red, blue and maroon. Products are priced as entry-level prestige beauty items, the company added. Items in the aura3system lineup retail for $32.50-$42.50, while foundations cost $25 and lipsticks are priced at $15. Aura Science will be promoted with a sampling program that is "unprecedented in the beauty industry," Burns maintained. The company will promote a "never out of stock inventory" of samples for the aura3system to develop long-term customer relationships and develop lifetime users, Burns said. Intimate Brands also will conduct sampling and promotions via direct-mail and will invite Bath & Body Works and Victoria's Secret customers in-store as part of a one-time exclusive promotion, Burns said. Regional ads will be used to promote the opening of new stores, she added. |