Maybelline executives confirmed talks with global agency networks-including J. Walter Thompson Co.-about the Maybelline account outside the U.S. But they wouldn't confirm discussions with Yardley of London Co. to sell back the North American rights to Yardley toiletries.
"I can't comment on that one," said Gerald Beddall, exec VP of Maybelline.
Last month, President Bob Hiatt denied Maybelline was interested in selling the rights; last week he was traveling and couldn't be reached for comment.
Wall Street, however, would applaud such a move.
"Yardley has been a thorn in their side since the day they received the privilege," said PaineWebber analyst Andrew Shore. "It's costing them money and provides nothing."
Since joining Maybelline a year ago, one of Mr. Beddall's charges has been to grow international business, the one bright spot on the company's financial report card.
Of its $351.8 million in total 1994 sales, international accounted for 12.9%, but meanwhile the division's sales increased to $45.4 million, up more than 27% from a year earlier. By comparison, sales of Maybelline USA were up by less than 1% to $287.6 million, while Yardley North America sales declined more than 25% to $18.7 millon.
Earlier this year, Maybelline began refocusing its efforts on Classic Maybelline cosmetics after diverting resources last year to build Revitalizing cosmetics and skincare products for women 35 and over.
The shift has helped, said Mr. Shore, "but not that much. They are not getting worse but they are not getting much better."
Indeed, while sales of Classic and Revitalizing cosmetics grew 4.3% to $372.4 million for the 52 weeks ended April 30, according to Information Resources Inc., share slipped by 0.2% to 16.45%, making Maybelline the No. 3 brand after Procter & Gamble Co.'s Cover Girl and Revlon.
Maybelline management has been extremely pleased with international growth and plans to pursue it aggressively by adding new markets and expanding in existing markets such as Asia/Pacific, eastern Europe and Latin America.
That's why Maybelline is talking with agencies other than incumbent Gotham, New York, which last year opened a London office to work on Yardley overseas. Gotham's sister Interpublic Group of Cos. agencies McCann-Erickson Worldwide, Ammirati & Puris/Lintas and the Lowe Group have the needed reach, but have conflicts with Unilever, Johnson & Johnson and Estee Lauder Cos. business.
Mr. Beddall said an international assignment wouldn't affect Gotham in the U.S. where it has the more than $50 million Maybelline account. Current international spending is estimated at less than $10 million.