Specialist
Divisional leader at Guthy-Renker Ventures LLC
Agenda
- 2022 outlook and trends in the North America beauty industry
- Demand across key segments – mass, masstige and prestige – and travel retail dynamics in geographies such as China
- Channel dynamics, focusing on broad category recovery and supply chain headwinds
- Competitive dynamics of specialty retailers such as Sephora and Ulta (NASDAQ: ULTA) vs e-commerce players such as Amazon (NASDAQ: AMZN)
Questions
1.
Could you share your 2022 outlook for the beauty industry?
2.
For skincare specifically, you mentioned that it’s been growing rapidly and continues to grow. Do you find that it’ll continue to grow at a much more moderated pace, or at a similar pace? Are there any other periods of growth that we can potentially compare it to?
3.
What will differentiate or define the winners from the losers given saturation in skincare?
4.
You mentioned a recovery in colour. Obviously, colour cosmetics were depressed over the course of the pandemic. Where are we on the recovery curve for colour specifically, or those other segments that were depressed over the pandemic?
5.
How would you frame the headline risk for sustainable recovery in a segment such as colour, given COVID-19 variants?
6.
In a previous Forum Interview [see Coty – Portfolio Positioning & Beauty Industry Outlook – 16 December 2021] the Specialist had called out the risk associated with supply chain disruptions and port congestion. One such example is input materials such as pumps and, of course, rising container costs. Can you expand on some of these challenges, and your thoughts on the potential actions by major players in the industry?
7.
Which industry participants do you think are best- and worst-positioned to address supply chain disruptions?
8.
Are larger players exposed to travel retail in any better or worse shape than players that aren’t exposed to travel retail altogether?
9.
It seems China had a booming travel retail market that had a performance like no other country in the world. What is your outlook for it?
10.
Could you share your thoughts on channel dynamics and consumer adoption of D2C brands vs shopping at other channels or speciality retailers, including Sephora and Ulta?
11.
Who do you find feels cornered by Amazon regarding its efforts within the beauty sector?
12.
What can players such as Ulta or Sephora do to mitigate some of the market share churn coming from Amazon’s efforts?
13.
What do you think of the relative success around Kohl’s with Sephora’s shop-in-shop vs Target’s with Ulta?
14.
What do partnerships such as Sephora’s with Kohl’s mean for competition? Do you find that they provide more of an advantage to the mass retailers such as Kohl’s and Target, or more of an upside to the speciality retailers such as Sephora and Ulta?
15.
How would you frame the risk of cannibalising sales at Ulta and Sephora’s standalone stores as a result of the shop-in-shop partnerships?
16.
NPD recently reported a 30% growth in prestige beauty for 2021. Could you comment on this strength specifically and how sustainable you find the growth to be?
17.
Do you find that prestige as a category was a beneficiary of government stimulus at all, or do you find that the segment benefited more from less spending on experiences and events, which resulted in more spending on products instead?
18.
If growth for prestige is sustainable and we use the argument that experiences and events are coming back, could there be a risk of some pullback there?
19.
How is growth in prestige specifically impacting growth for beauty at other price points? What is your outlook for mass and masstige up against the growth in prestige?
20.
Could you share your thoughts pricing dynamics, including Q4 2021’s promotional activity?
21.
Which category – mass, masstige or prestige – is experiencing the most pricing pressure, given rising supply chain and material costs?
22.
Considering inflation specifically and how it impacts pricing actions, how do some of these costs get passed down directly to the consumer? When do they get absorbed by the product makers and/or shared with product resellers or speciality retailers?
23.
What is your outlook for the haircare industry?
24.
Could you expand on Olaplex and how it’s positioned, in light of its recent IPO?
25.
How is Olaplex positioned against a player such as Wella in the US specifically?
26.
What is the impact of the increased adoption of med spa procedures, and how much of a risk or opportunity does it create for legacy beauty players?
27.
What are your thoughts on industry innovation? What product innovations will be able to retain or sustain consumer appeal, vs those that are boom and bust?
