DISTRIBUTOR - BCPL

Engaging the Prestige Segment Beauty Concepts Pvt. Ltd. was founded in 1998 ith small distribution network and premium brands- Davidoff & YSL and it went on to acquire Adidas and Jovan brand’s distributorship in 2000. Today, the distributor represents the fragrance section of luxury brands from the Lancaster Group such as Jil Sander, Jennifer Lopez, Chopard, Joop, Kenneth Cole, Marc Jacobs, Sarah Jessica Parker, and Nikos besides Davidoff and have launched Lancaster kincare and Cosmetics in 2005 . Apart from the Lancaster Group, they represent Yves Saint Laurent Parfums as well as their Beaute range. Oscar de la Renta, Van Cleef & Arpels and Bvlgari are other houses whose fragrances are part of Beauty Concepts’ repertoire. Along with these premium labels they have Benetton, Tabac, Diesel and Adidas. In the mass range they have Calgon, Jovan and Healing Garden.
Given the profile of the brands, nearly 30-40% of the business for the company comes from 16-25 years age group that are sold through nearly 150 retail outlets throughout the country. Beauty Concepts also has the largest spends on vertisements amongst distributors of imported cosmetics. The company has been conservative in distribution of beauty and cosmetic brands like YSL and Lancaster
perhaps due to the lack of adequate retail space on the one hand and strict guidelines from the parent brand on the other. In an interview with Beaute Espace,
Tony Chin, CEO Beauty Concepts Pvt. Ltd. shares some major milestones of their evolution, challenges and future course of action.

What is your USP as a distributor and with brands entering the market with own subsidiaries, what kind of diversification would you look at, in the future?
We are unique as we are the only distributor that make use of foreign expertise, the only independent distributor with a foreign CEO that brings in expertise from developed markets to the beauty & fragrance trade in India. As far as business on the ground is concerned, we have extensive and decentralized logistics support
(regional warehouses in all major metros) and as a result faster stocks replenishment is possible. Besides, we employ a professional management team in marketing and PR. With an able team and backup, we are able to provide customized marketing platform for different brands with their varying requirements and the requisite financial resources to have widest distribution network for the brands. As for diversification, we would look into other segments within the beauty category to see for any potential opportunity. We are already retailing - having 2 exclusive outlets retailing super prestige accessories like watches (we are the exclusive retailer for Rolex in East India, as well as Cartier, Mont Blanc, Lalique Crystal etc.)

Which, in your analysis are the better markets for fragrances in the country and what needs to be done to increase and improve fragrance sales?
The better markets for fragrances are in Mumbai, Delhi and Bangalore where sales are in proportion to the level of consumer sophistication and disposable income. However, the Southern region is also a very important market for midrange fragrances, being more pricesensitive. Perhaps, the most important thing to do is to educate the consumer in the use of fragrances as part of their daily hygiene routine. Many consumers still do not know the difference between a deodorant and an EDT – hence the tendency to buy the cheaper price products. The aspirational aspects are also important as we need to communicate to the consumer the dreams, through images of luxury & prestige.

What challenges do marketing of premium cosmetics pose in India and how much of a problem is the rigidity in approaches of the companies (read principals) themselves? Do you think the duties need to be tuned in favour of imported cosmetics or are they at par with those in developed markets internationally?
There must always be brand guidelines, else the image and message will not be consistent worldwide. The real challenge would be to adapt these to local tastes and peculiarities and not deviate too much from the original concept of the brand. Currently, the duties are very high vs.
those of developed markets where there are no duties. As such, all the distributors are squeezed in terms of profitability. We will be able to invest more and extend the availability of our products if duties can be reduced.

Would you be looking at new marketing strategies to allay fears amongst discerning Indians about imported products being fakes or older than sell by dates?
Definitely. The starting point here is of course to supply only bona fide retailers and guarantee quality of the products when they are purchased from these retailers. Return policies are in place already and if necessary, list of official retailers should be made known to the public in order to protect them.

What is the split between prestige and mid-segment brands in your portfolio? Would you be looking at adding new ones? Which are the brands (any particular general traits) that necessarily do well in a multicultural, multi-lingual, developing country like India?
Prestige segment still overshadow the mid-segment in a 4 to 1 ratio purely because of the lack of space for the midrange category in most retail stores. We will definitely be adding new brands – mainly globally recognized names that will appeal to a wide audience in India.

Is there any particular retail format that you find missing on the Indian scene and specially one that would help the cause of this particular segment of products?
Up-market perfumery chains is still not offering enough coverage of the market. In more mature markets, they offer the best exposure for the mid-segment. Also in department stores, more space can be allocated to this segment as the growth rate is the highest vis-à-vis mass and
premium category.

Any other comment that you would like to make on the current state of the market and where you see it heading by the end of the decade?
Current growth will be led by the lowerpriced segments specially with the retail channel expansion that supports these price-points ( hypermarts, food trade outlets etc.) Then in the next 3-5 years, demand will increase for the mid-range and premium products rapidly as consumers trade up and buy more expensive brands.

Major Milestones for BCPL
Company founded in 1998 with small distribution network – brands Davidoff & YSL
2000 Acquire Adidas and Jovan brand’s distributorship
2001 Davidoff established as the market leader in premium fragrances in all
selective distribution.
2002 Adidas grow into market leader in the imported toiletries category in
selective distribution (i.e. in organized retail outlets like dept stores, chain
stores)
2005 Acquire Bvlgari and Ferragamo fragrances distribution rights
2005 Launch of Lancaster Cosmetics