The French connection (page 3 of 3)

This was partly because the company chose to use only natural products - rather than chemical byproducts - in the manufacturing of its cosmetics. Chemical-based cosmetics were all the rage in the 1970s, widely seen as high-technology and thus highly efficient. But Clarins persisted with its strategy.
Number one. In 1980, Clarins became the number one skincare player in France. "Before, we were knocking on the doors of retailers, trying to convince them to stock our products," Courtin-Clarins says. "Then, suddenly, we had everyone lining up outside our door for orders.'' Becoming number one in France opened doors to other markets. Soon, Clarins was selling in 15 countries around the globe. Today, Clarins is present in 120 countries on five continents. The success of Clarins is due not just to the quality of the product, but also to shrewd marketing. It also has a large laboratory to test all the products before they are sold.

Courtin-Clarins says these labs are the most powerful weapons in the Clarins armory, especially as they provide a way for Clarins to keep track of consumers' response to its products and their expectations.

"What is the difference between a three-star restaurant and an ordinary one?" Courtin-Clarins asks. "It is the know-how of the chef, since the ingredients are the same. We're the only company that uses the products every day in our labs. We test them and get customer reactions. We have 10 women who spend their lives with cream on their hands."

In the early 1980s, Clarins entered the Gulf market. The barriers to entry proved formidable. At the time, Gulf cosmetics sales were dominated by fragrances, which made up 70 percent of the market. Make-up accounted for 20 percent and skincare products the rest.

"My main challenge was getting shelf-space visibility," says Courtin-Clarins. "Since perfumes sold more, the retailers gave them best places in the shop displays. We had to struggle since we could only offer 10 percent of the volume of, say, Chanel Number 5."

Courtin-Clarins felt that the way to get ahead in the Gulf was through a highly motivated and well-trained sales force. One of their first steps was to train staff in how to help customers choose the right products for their skin type. "It's not like perfume, where the only thing that counts is the smell," he says. "We have a wide range of products, but if people choose wrong product, it won't work. The best way to serve the customer is not only to ensure that you have a good product, but also to make sure that she buys the right one."

For Clarins, a lot is riding on the success of its new Middle East distribution strategy and its new subsidiary. The company will surely make enemies as it shuts out powerful distributors and shuts down an old-fashioned way of doing business in the region. Today, Clarins has a steadily growing market share in the Middle East, and Courtin-Clarins has set ambitious targets for future growth: "Today, the region accounts for about 100 million francs ($15 million) in sales each year. We aim to double this within a year."

Part of his optimism comes from his experience in Saudi Arabia, where he recently overhauled his distribution system. "We reduced our doors by half and doubled our sales," says Courtin-Clarins. "It was done through good marketing, good sales, good techniques. Makki [the Saudi distributor] is very organized. They have everything that you can dream of or expect from a good distributor."

Clarins hopes to be able to duplicate its success in Saudi Arabia in other countries in the region, especially in emerging markets such as Egypt, which has a population of nearly 50 million.

Just like in Morocco more than two decades ago, however, Clarins' fate in the Arab world depends upon the strength and trustworthiness of its local partners. But this time, there is no elegant man in a finely tailored suit whispering advice in the chairman's ear. The company will succeed or fail in the Middle East based on its own strengths and and its own frailties. Which is exactly the way Christian Courtin-Clarins wants it.