The Professional Beauty Industry as I once knew it, is dead. Having spent the past forty five years in our once proud industry at every level, my purpose in writing this article is to document by decade, starting with the 60’s which is when I came into the industry, the dynamics that drove that decade with the evolution of the Industry moving forward, so we can all see where everything started shifting negatively and where the industry is today as a result of the evolutionary process over the decades.
Salons, once a haven for women, have become Independent Stylists leasing space from the landlord / salon owner. Professional only products have become commodity products purchased on price and found everywhere, especially outside the salon.
The large distributors are now owned by the corporate giants, leaving a landscape with small distributors fighting the system and losing the battle to a marketplace never seen before in our industry. The 60’s were all about wet sets, women visiting their stylist at their favorite salon every week to redo their do. During this decade, the old guard manufacturers were Revlon, Lamaur, Helen Curtis, Rilling, Clairol, Roux, and others that generated their income primarily though salons. Early during this decade, Paula Kent purchased from Jheri Redding 3 simple formulas and started a company called Redken Labs. At the same time an English stylist, Vidal Sasson, had started a movement that would literally turn heads upside down as his message was “Let the haircut be the blueprint for the style.”, which opened the door for salons to expand their business as they were working on the same 50 clients each week. In a month’s time, they still only worked with the same 50 clients. When hair cutting became the trend, stylists focused on hair cutting were now seeing a different 50 clients each week, now totaling 200 a month, opening the door to additional revenue.
The 70’s saw the emergence of more manufacturers following the Redken model, seeing the entry of Sebastian in 1976 and Nexus in 1979. The focus of these new manufacturers was to help the salon build a whole new business called retail, eventually opening the flood gates to greater income for all. In the 70’s many Redken concept salons were competing with their service business to increase retail sales to 25% of their gross, which in turn opened up profitability to levels never seen before. Redken Labs grew exponentially based on their Beauty through Science philosophy and the newer entries such as Sebastian and Nexus were setting their own standards to compete in the new direction of the industry. Chemical services in salons, in particular perms, drove huge numbers at all levels and manufacturers were starting to phase in new products to support the shift in clients’ needs for their maintenance free hair. Education was also on the rise, as salons wanted to know as much as possible about the products supporting their services and the new retail income stream that was on the rise.
The 80’s was a decade with consistent growth and power for the new manufacturers. Paul Mitchell and Matrix Essentials came into the market in 1981 and we now had five new, aspiring and growing companies driving the growth of salons through their direct leadership and were becoming so strong that there was an additional shift from the leadership of the aforementioned manufacturers found in the 60’s to the top five leaders that drove the 80’s with their philosophy, products, and education. During this decade, salon retail went through the roof, as salon clients were an easy target for professional products that were exclusive to the professional salon. Big hair was the rage which opened the door to newer products that supported this trend. During this period, Beauty Supplies were allowed to represent and carry professional products, as long as they had a shampoo bowl and offered services as part of their in store layout. Unfortunately, this was one of the first areas where the manufacturer lost control and opened the door to price cutting, non adherence to policies, and professional products starting to show up in less than professional outlets.This decade also saw the rise of the Independents, eroding the old system of commission salons where the owner hired stylists as employees and grew their business as a team oriented effort. Now the majority of salons nationwide is nothing more than lease spaces for anyone willing to pay their space fees. Products are harder to position in salons because every stylist can make their own decision as to what they use and sell and education has gone by the wayside as a salon owner cannot mandate that his lessors have to attend any educational events.
The 90’s were a time when we acknowledged that we were an aging population and that the Baby Boomers were driving the bus into the next decade. We now see the entry of the corporate giants, Loreal, P&G, Alberto Culver, Unilever, etc., start to purchase not only large distributorships, but also the manufacturers at the top of their game such as Redken and Matrix. The only one of the large five giants in the industry, Paul Mitchell, is the only one that has not been sold. The others, Redken, Matrix, Sebastian, and Nexus are now corporately owned and driven, and while they espouse “professional only”, sell their product range through any source that will make them money. That is why professional only product has become “commodity” product, which is defined by price and ubiquitous placement. With the purchase of the large distributorships that drove the growth for the large manufacturers, in particular Redken and Matrix, the market place was left with middle to small sized distributorships that have not been able to compete with the mass size and scope of the corporate giants.
The 10’s have brought us full circle to where we started this journey in the 60’s. The giant manufacturers then were forced into going retail as the new giants had created an atmosphere in salons that kept their business growing. Unfortunately, we are seeing the same thing happen again with the ownership of family owned and driven businesses being bought out by the corporate giants.
Here is why we are seeing and feeling the results of the death of the Professional Beauty Industry.
Diversion: This key area saw salon products move into retail channels through unscrupulous and unethical people. We had a captive audience for professional products in the 70’s and 80’s, but once the salon client understood that they could find professional products at outlets outside their professional salon, it opened the flood gates and is the original reason we now see these products literally everywhere. The big losers in this ongoing game are the salons and their stylists, who have never recovered. Why buy professional product at the salon when they can buy it at Costco, Target, Drug stores, grocery stores, and on into infinity. Interestingly enough, Beauty Supplies today complain and gripe about their losses to mass retail, as salons once did about them. How the circle turns.
Ownership: Once the top tier of manufacturing companies moved from family ownership to corporate ownership, driven specifically by “bottom” line profitability and stock holders looking for a return, we see a major shift. The reason we don’t see any large number of direct manufacturer educators for these companies, is they were the first things to be discarded for cost savings. Bigger is not necessarily better.
Independents: This one shift transformed our industry, taking away leadership at salon level and creating a nightmare for manufacturers and distributors alike, as they now have to speak to each stylist separately in salons that once had one or two key people that made financial decisions for the team. Typically stylists today only come into their space when they have an appointment and could care less about education and the industry as a whole.
Distribution: Today it is hard to find large distributorships that once dominated the landscape with their sales force, educators, education and support. They have been purchased by the giant corporations for their stores, which is part of the game plan the giant corporations continue to follow. They want stylists to come in daily if needed, to purchase what they will be using tomorrow or even this week. While they maintain a weak sales force, the long term plan is to get all stylists to enter their stores to purchase their beauty needs. The current distributor base now works with smaller lines that many times do not have the capital to properly market and drive their business.
Trends: Having lived through six decades of this industry and observing the many trends such as the Farrah Fawcett cut and style, the Dorothy Hamill Wedge, Big Hair, Jennifer Anniston, and now Rich Girl Hair. Unfortunately, we have gotten away from keeping the client tied to the salon for service, as hair has become less of an accessory and almost anti-salon. With the exception of the specialty services such as color, straightening, relaxing, and formal events, look around at women’s hair. It is in poor condition, over processed, dry and unmanageable, not shiny, and seemingly not as important as we once saw in previous decades.
Since I took a hard look at why we have lost the industry we all once knew, I would be less than responsible if I did not offer long term solutions to the mess we are in. Here are a few of my suggestions.
Contemporary manufacturers have to control their product movement. If they are working within the professional industry, they have to accept the responsibility for the way their products are positioned, taught, and sold. I suggest legal contracts between the manufacturer and their distributors, as well as the distributor and their salons. Any deviancy brings the loss of the line and legal ramifications. This includes Internet sales, which are typically sold at a discount and offer little to no control. A new interactive group representing these distributors has to be enacted, ensuring that the goals of “professional only”, be the supporting factor driving their growth.
Legislation has to be started state by state to establish salons as a commission based business and Independents have to be relabeled as employees so that control can be brought back into the industry and its long term opportunities.
Distribution networks have to continue developing for the professional only market with a full understanding of the role they share within the vertical integration of their manufacturers and vendors.
In closing, I come from an era in this business where professionalism was everything and was exhibited by all players with a stake in the game. It was a glorious time, with success and prosperity for anyone willing to work hard and devoting their efforts to contributing to the overall concept. It was a time of passion, loyalty, and generally a lot of fun. What happened? Today we are in an apathetic state, very few are making good money, and opportunities have seemingly gone. Being the eternal optimist, I continue to think that we can get it back, but it is going to take all of us moving in the same direction and getting involved at all levels to right the great ship and get it back on its proper course.