BATAVIA, Ohio (AdAge.com) -- Undeterred by recession or getting into a retail business with which it has little experience, Procter & Gamble Co. is buying the Art of Shaving, seller of pricey men's shaving products at upscale shopping malls.
P&G is looking to get more direct contact with consumers and exposure to men's prestige personal care through the deal, said spokeswoman Kelly Vanasse. Gillette's relationship with the 36-store retailer goes back to 2007, when it began selling high-end Gillette-branded chrome products there.
Even before that, Ms. Vanasse said, Art of Shaving designed all of its razor handles to fit only Gillette products. That's one reason she said the company expects little backlash from mass retailers, since razor handles sold at the mall stores will still create demand for replacement blades.
P&G beauty rival L'Oreal has long run a mass business in addition to major retail operations such as the Body Shop and Kiehl's.
Recession or no, P&G's long-term strategy is to compete in every personal-care channel, increasingly including salons and prestige, where the men's business is underdeveloped. Ms. Vanasse said P&G already operates salons through last year's acquisition of Frederic Fekkai. P&G also runs retail boutiques for its ultra-prestige SK-II skin-care brand globally.
"The Art of Shaving is an excellent strategic match for P&G, building our global leadership in men's grooming and broadening our portfolio to reach high-end male consumers," Chip Bergh, P&G group president of global male grooming, said in a statement. P&G also has a major presence in prestige men's fragrance with such brands as Hugo Boss, where it's been gaining share while losing sales in the recession.
To be sure, all those things are counter-trend, even for P&G, which is testing Tide Basic, a stripped-down, value-priced version of Tide detergent, according to a report today from Consumer Edge Research. But Art of Shaving "is a strong business, and they are maintaining well in the economic environment," Ms. Vanasse said. "Guys who are buying at this price point are doing it because they have a need, so they're willing to spend the money."
Strength in e-commerce
Besides its own stores, Art of Shaving distributes products through about 700 Sephora stores, and it's particularly strong in areas such as e-commerce and developing one-to-one relationships with guys. "We certainly are stepping up our online presence in e-commerce," Ms. Vanasse said. "Art of Shaving brings with them a large e-commerce program."
The recession, meanwhile, has taken a nick out of mass shaving, as sales fell 11% for razors and 2% for refill blades last quarter in food, drug and mass-merchandise outlets excluding Walmart, club stores and dollar stores, according to Information Resources Inc. data cited by Deutsche Bank. Sales of lower-priced disposables, however, rose 2.6%.
Art of Shaving is just one new way P&G is trying to get men to shave more. In recent weeks, the company has released viral videos to teach men how to shave everything from their backs to their genitalia and a new iPhone app to give the bearded a virtual look at how they'd look clean-shaven. Omnicom Group's BBDO and Proximity handle.