BUILDING A BETTER HOUSE OF BRANDS.

(Procter & Gamble Prestige Beauty

GmbH)

Article from:
WWD
Article date:
December 8, 2006
Author:
Epiro, Stephanie Epiro, Stephanie

Byline: Stephanie Epiro

GENEVA - Procter & Gamble Prestige Products can now lay plans for an aggressive
future, thanks to the heavy lifting the company has done in the last three years. P&G has
built a powerful growth engine, one the company believes will propel it into a top spot in
the global prestige beauty business.

"Take a look at how the portfolio has changed in the past three years and you can see
how it's really become focused," said Carolyn Tastad, vice president of global prestige
products, market development organization, at P&G Prestige.

The stable of 27 brands now includes Hugo, Boss, Escada, Lacoste, Dunhill, Valentino,
Gucci, Dolce & Gabbana, Baldessarini, Mont Blanc, Jean Patou, Rochas, Boss Skin,
Anna Sui, Puma, Laura Biagiotti and Giorgio Beverly Hills. There also is a group of
lifestyle brands that function as entry points, mostly for younger consumers and focused
primarily on Europe, including Mexx, Bruno Banani (a German underwear brand),
Naomi Campbell, Ghost, TomTailor, Gery Weber and Marc'o'Polo. Recently, P&G
Prestige Products announced that it was retiring classic German cologne brand 4711, in
addition to Tosca and Irish Moos luxury toiletries. Hartwig Langer, global president of
the prestige products division, said he expected the brands to be officially retired over the
next couple of months.

From this mix, P&G has identified Boss, Lacoste, Dolce & Gabbana, Gucci and
Valentino as its driver brands.
Langer said the lineup will stimulate growth for the fast-paced beauty player in the
future.

"I think we have the right portfolio of luxury and prestige brands to continue winning in
this market," he said.

This year, a key addition to the firm's fragrance portfolio was the lucrative Dolce &
Gabbana beauty license, which, according to industry sources, is worth up to $240
million in wholesale revenues annually.

Asked what Dolce & Gabbana brought to the mix, Langer said the brand was innovative
and fashion-forward. "We are happy to be working with them to drive the fragrance
business into new territory."

The firm also added Gucci to the fold this year, after re-signing the beauty license that the
Cosmopolitan Cosmetics subsidiary of Wella brought to P&G when it was acquired in
2003.

Together with the Valentino beauty license, which P&G Prestige Products acquired in
2003, Gucci and Dolce & Gabbana form a strong Italian fashion troika for the company.

Other fashion brands were added in recent years, but during the same period the company
choose to cut loose its fragrance and beauty licenses with Tony & Tina, Yohji
Yamamoto, Yardley toiletries, Trussardi, Charles Jourdan and Max Mara.

In July, P&G Prestige Products decided to close down the fashion license of Rochas,
originally acquired alongside the Rochas fragrance license from Cosmopolitan
Cosmetics. The company caught considerable flak from the fashion press for the move,
since Rochas' designer Oliver Theyskens had won rave reviews for his Rochas
collections and became a media darling.

As tough as that episode was, P&G clearly realized the need to keep an eye on its
mission. "It's not our core competency," a P&G spokeswoman said at the time. "We're
not a fashion company. We're very grateful to him [Theyskens]. He's done an amazing
job at Rochas, but our core competency lies elsewhere."

Caption(s): Valentino's latest scent. / Boss Skin products. / V by Valentino eau de

parfum.

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Epiro, Stephanie. "BUILDING A BETTER HOUSE OF BRANDS.(Procter & Gamble

Prestige Beauty GmbH)." WWD. Conde Nast Publications, Inc. 2006. HighBeam
Research. 10 Mar. 2010 <http://www.highbeam.com>.

Epiro, Stephanie. "BUILDING A BETTER HOUSE OF BRANDS.(Procter & Gamble

Prestige Beauty GmbH)." WWD. 2006. HighBeam Research. (March 10, 2010).
http://www.highbeam.com/doc/1G1-155837548.html

Epiro, Stephanie. "BUILDING A BETTER HOUSE OF BRANDS.(Procter & Gamble

Prestige Beauty GmbH)." WWD. Conde Nast Publications, Inc. 2006. Retrieved March
10, 2010 from HighBeam Research: http://www.highbeam.com/doc/1G1-
155837548.html

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COPYRIGHT 1999 Fairchild Publications, Inc. This material is published under license
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