With the glow gone from Vital Radiance, mass market retailers are scurrying to fill the gaps in their cosmetics walls.
Buyers, who didn’t want to be named for competitive reasons, singled out Physicians Formula, Rimmel, Max Factor and their own exclusive brands as those that could gain more space from the Vital Radiance fallout. Most said they’ll fight tooth and nail to ensure that the color cosmetics space isn’t pulled away to support other growth categories, such as skin care and the white hot oral care category.
Revlon abruptly announced on Monday it was pulling the plug on its Vital Radiance line, a color cosmetics collection for mature women. Buyers said that up until last week, Revlon representatives were showing plans for a price reduction on Vital Radiance and an amended nameplate that includes the Revlon logo.
When Vital Radiance was launched, the decision was made to treat it as a freestanding line and not use the Revlon name. Some chains even devoted more space than they would have to the line since it wasn’t part of the Revlon franchise. In reality, not promoting the Revlon name turned out to be damaging, retailers said.
Many major merchants said the name change and price cut would not have been enough to save the beleaguered brand. “Retailers didn’t want to be holding double inventory — the original Vital Radiance and the new packaging,” said one competitor who asked not to be named. Revlon said it expects to record a charge of about $63 million in the third quarter related to discontinuing the Vital Radiance brand.
Some chains faulted the timing of Revlon’s decision. Because 2007 planograms have already been planned, this move leaves them with a hole in the display. Several retailers said the decision reflects a chief financial officer’s mentality, not someone familiar with the trade’s needs. With the elimination of Vital Radiance also came the loss of at least 250 jobs. During a conference call on Monday, Revlon’s new president and chief executive officer, David Kennedy, talked a great deal about getting back to leveraging the strong Revlon heritage.
With the demise of the line, space is up for grabs. Hearing the word on the street that Vital Radiance was off to a lackluster start, competing manufacturers have been planning an attack on its display footage for months. To be sure, competitors point out that it isn’t only Vital Radiance that is faltering. L’Oréal’s HIP has been less than stellar, as well. Buyers are planning to wait that out longer than Vital Radiance since L’Oréal is tweaking HIP’s color palette.
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Several retailers have already started reworking planograms. Wal-Mart, for example, had made the decision months ago to pare back on Vital Radiance in 1,000 doors. Starting next month, Physicians Formula will gain much of the space held by Vital Radiance. In January, the entire chain will have a new pegged cosmetics wall with Physicians Formula getting at least 2 more feet of space.
This is good timing for Physicians Formula, which recently filed an initial public offering. The company, already known for product innovation, is riding high on the mineral wave with its Mineral Wear collection. Retailers don’t feel that Mineral Wear will cannibalize from existing brands, making it an important addition to the lineup.
Prestige Cosmetics is also set to gain, according to Tom Winarick, executive vice president. “We’ll be gaining space in several of our mega accounts and will be relocated into the physical Vital Radiance space,” he added. He added Prestige is running “significant double-digit increases” with almost all of its major retail partners.
Another company that retailers are taking a hard look at is Rimmel. Although serving a much different consumer than Vital Radiance, Rimmel has been growing in popularity and could nab more space.
An outside shot, but one mentioned by several buyers, was Max Factor. Although Max Factor has been pared down to a few doors, the brand is doing well in those stores prompting Procter & Gamble to thump its chest and ask to regain space it lost before the line was given a fresh look last year.
A handful of chains won’t be shuffling brands as they took Vital Radiance in as floor stands only. Rite Aid, for example, will simply have more floor footage available for off-shelf promotions.
There are also reports that exclusive brands could get more shelf space as new brands are nudged out. Some industry sources even suggested Walgreens, which did well with Vital Radiance since it was a nice match with the chain’s customers, should take it on as a private label. Of course, Walgreens already has IsaDora which is exceeding expectations, according to the chain.