On Aug. 21 Mario Argenti, 51, was named president and chief executive officer of Baltimore-based Kao Professional Salon Services Inc., a firm with approximately $200 million in sales in North America. He replaces Andrew Biazis, who served in the role for four years. Argenti’s responsibilities include growing KPSS’ two professional hair care brands, Goldwell and KMS California, in the North America region. Though Argenti most recently worked in prestige cosmetics as managing director of the Estée Lauder Cos.’ Australian business, Argenti has 22 years of experience in the salon industry, including his role as chairman of the board and ceo for Wella Corp., USA. Argenti rejoins the salon arena at a time when consolidation is affecting both distributors and manufacturers, when companies such as Wella are selling products directly to salons and L’Oréal is buying a share of distributorships, such as its recent 30 percent acquisition of Beauty Alliance International. Below, Argenti explains why the industry’s current flux puts KPSS at a distinct advantage with many distributors and how he plans to double the company’s market share in five years.
WWD: What lured you from prestige beauty to the salon industry?
Mario Argenti: The salon business is different from retail cosmetics. It is a dynamic industry. You become addicted to it. What attracted me to KPSS is its heritage of being a salon-only brand. It is one of the few brands to claim that. A lot of brands have originated in the salon but have invested in other areas. The second thing is the image of the company, which is very product- and quality-driven. The color system [Goldwell] is second to none. That is an attraction to any marketer. It is a philosophy of the company [a subsidiary of KPSS GmbH based in Darmstadt, Germany, which is owned by Tokyo-based Kao Corp.] to partner with the professional hairdresser to reach the consumer. While many salon brands claim that, I think us actually being a salon-only brand makes our philosophy have credit.
WWD: What are each of KPSS’ brands’ strengths?
M.A.: Goldwell’s strength is its strong dominance in color. It’s very difficult for a company to get into color and it’s the most difficult category for a hairdresser to move from one [brand of hair color] to another. KMS’ strength is more in the wet lines. So, the marriage between the two are ideal. They can complete each other rather than fight for the same turf and it gives us the ultimate offering to the hairdresser so we can service both categories. The ability to exploit these synergies gives us a greater unity of effort in the marketplace.
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WWD: Who do you consider your competitors?
M.A.: Globally, for Goldwell, there’s Wella. Locally, there’s Matrix and Redken. For KMS California the market is fragmented and therefore much more competitive. There’s PureOlogy, Redken and Paul Mitchell.
WWD: How large are the brands?
M.A.: Goldwell has about a 6 percent share in the U.S. KMS California is about $200 million worldwide. We still have a long way to go [for Goldwell] but we don’t want it to be everywhere. We still build our philosophy on the prestige end of the business rather than making a product available for everybody. We are looking at the ‘A’ and ‘B’ salons as the primary focus. If we doubled our market share that’s still not mass in the salon industry. That’s our opportunity over the next four to five years. We can double our share without losing our culture or philosophy. We will also look at future acquisitions as opportunities arise but the [ultimate] decision is not mine, that is for the home office of Goldwell in Germany.
WWD: How do you plan to double sales in four to five years?
M.A.: In the majority of cases KPSS uses independent distributors. I want to maximize the fantastic distribution network that we have. With the consolidation that exists in the marketplace, like distributors and manufacturers getting together, I think there are several distributors that are looking to maximize their relationships with certain brands. We have an exclusive sales force with our distributors, which gives us the opportunity to synergize KMS with Goldwell.