Salon brands – reaching the consumer

One may hear ‘Alfaparf Milano’ and see, more of this brand on the next visit to a salon.

Some time back, the hair care brand entered India through a partnership with Yerazig Impex. But instead of making an effort to link up with conventional consumer goods distribution channels, the brand chose to enter consumer mind space through their hair stylists. ‘Alfaparf Milano’ came into India very recently and have partnered with over 1,600 salons in the country. We intend to reach 6,000 salons by the end of this year.

That target is an ambitious one. Considering that even those who have been around in the channel for substantially more time L’Oreal, Wella and Schwarzkopf Professional are present in about 10,000 salons, 4,000 plus salons and 3,000 salons respectively.

One thing is however clear. Salons as a channel for selling grooming and beauty products are extremely important. That stature has only been growing with time.

In 1994, the same year when Sushmita Sen and Aishwarya Rai won the Miss Universe and Miss World pageants respectively. Cosmetic brand L’Oreal established its 100% subsidiary in the country . Then, the market was largely dominated by consumer goods giant, Hindustan Unilever’s (HUL) brands Lakme and Ponds. While it was not easy to shake HUL’s base, particularly in the retail trade channels, the new entrant had to look at other avenues — salons. Other international brands like Wella and Schwarzkopf Professional followed L’Oreal into salons. In some ways, it helped that the salon business in India was highly unorganized each one could pick and choose their hotspots.

The good part was that the salon segment was growing in a spectacular fashion. L’Oreal India company’s salon business grew by above 30% in 2007. For Schwarzkopf Professional that started its Indian operations in 2001, the brand has been growing at a CAGR of 25% since then. Wella Professionals’ have been enjoying a good double-digit growth. Business from salons should be in the region of Rs 14,000 crore and will grow at the rate of 40% for the next three-four years. To capture the market potential, L’Oreal has taken a segmentation approach.

L’Oreal’s Professional products division has three brands L’Oreal Professionnel, Matrix and Kerastase. While Kerastase is a premium professional luxury hair care brand available in only top-of-the line salons, Professionnel and Matrix chase the numbers.

For these companies, salons are much more than display windows. The big push that stylists can give these brands is in the form of a positive word-of-mouth. Even HUL’s early advertisements for Sunsilk recognised the power of the salon when they featured hair stylist Colleen Khan in their advertisements several years back.

Jean Claude Biguine India, have partnered with L’Oreal as it gives us the confidence to recommend their products to customers. Habib’s the salon chain with 110 outlets use Wella and Sunsilk in their outlets. Wella offers a good range of colors products that match color requirements and professional ethics.

Of course, recommendations do not come easy. Salon owners are often wary of whom they tie-up with. Apart from product strengths, distribution is on

The critical factor they look at. Bellezza chain of salons has been approached by others but has decided to stick with L’Oreal because their network is very strong. It is important in their profession that we have continuous supply.

Brands are not just banking on distribution and exclusive tie-ups . Training and in-store branding are other avenues to strengthen the link. So, L’Oreal, Wella and Schwarzkopf Professional conduct several training programs for the trade. L’Oreal and Wella, for instance, have five technical training centers each across the country.

L’Oreal launched the International Hairdressing Academy in Mumbai in 2006, that trains people who are part of the industry as well as those who aspire to be a part of it. In 2007, more than 30,000 hairdressers were trained at their technical centers, while 37 students were trained in the hairdressing academy in 2006. To build further equity, these brands regularly bring international stylists and conduct workshops and seminars.

In-salon branding is another avenue that’s being used. They provide signages, posters, standee displays, capes, aprons, trolleys, tool holders, scissors etc to the salons who tie up with Schwarzkopf Professional. Wella invests about 40% of its marketing budget in training and branding activities. L’Oreal and others took the salon route, as the conventional retail route was in the grip of HUL. Now, HUL is following them into the salons.

The company is introducing the Sunsilk Styling range which includes products like shampoos, conditioners, mousse and hair wax only for salons. It is tying up with the Habib’s chain to introduce these products to customers. Salons helps us understand the latest trends in hair and also helps consumers experience new and fashionable hairstyles using their favorite brands. Recently they have used this channel for Dove, Clinic All Clear and Sunsilk.

But salon brands are not taking their success for granted. While the initial excitement may bring in the consumers, it is very important that they are educated about the products. There is a tendency among salon owners to go multi brand and when that happens, consumer will have to make the choices. When that happens, salon brands may head for the retail stores.