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Hair Care Product Giant Looking for a New Image

Procter & Gamble wants to learn how to sell shampoo to women who shop at Saks instead of at Wal-Mart. The company is trying to spruce up its hair care products division by putting more hair care products into upscale department and specialty stores. Procter will buy Fredric Fekkai Co., a New York hair care products company, was the first step in the strategy.

“spruce up its hair care products”If successful, the move could boost the hair care products division because department store hair care products sell for far higher prices than Procter’s existing ones.

Fekkai sells a 3.4-ounce “Advanced Overnight Hair Repair” serum at Saks Fifth Avenue and Sephora, for $159, for example. Procter’s Clairol Herbal Essences hair color is on sale for $6 this week at Wal-Mart stores.

And women shopping the beauty counter at a department store respond differently to advertising than those who shop the supermarket beauty aisle, analysts said.
“It’s far more about word of mouth and about recommendations from hair stylists,” said Lynn Dornblaser, a senior analyst for Mintel International Group, a Chicago market research firm.

The image that Dornblaser said appeals to department store beauty shoppers is all about exclusivity: They want to be recognized as buying a more expensive product than their peers.

So-called prestige hair care products - those sold in upscale department and specialty stores - make up only a fraction of total U.S. hair care product sales but are growing at a much faster rate.

Stores like Saks and Bloomingdale’s used to focus on fragrance and skin-care products at their beauty counters, but in recent years they’ve added hair care products to keep up with specialty competitors such as Sephora. Recognizing the trend, Fekkai expanded beyond its traditional hair care salon business and aggressively went after department stores.

Procter has made similar moves in its skin-care business, which also is part of its $23 billion beauty division. Last year, it bought HDS Cosmetics Lab Inc., which makes DDF, a high-end line of skin products sold in department stores, spas and specialty retailers.

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