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More Economic Influence

Posted: February 26, 2009, from the March 2009 issue of Skin Inc. magazine.

page 6 of 8

Jane Wurwand, Founder, Dermalogica

We’ve long been a proponent of demystifying what skin care is all about and we pioneered this idea in 1989 when we opened our first concept store in Los Angeles. It was too early, it wasn’t successful. It was too early, the timing wasn’t right. It’s always been a pet project of mine because for me skin therapy has nothing to do with luxury, it has to do with skin health. We’ve never spoken about pampering or luxury or relaxation spa approach; it’s been our point of differentitation. It’s a necessity, a part of health and well-being like fitness or nutrition. It doesn’t require clients to be constantly in the dark and zen with whales singing, we’ve even had that as our mantra. Even through the dark days, I was about ready to give up. I’m actually excited about that economic downtown; it’s sounding the death knoll of the superfluous part of our industry.

Pampering and luxury doesn’t resonate, no consumer is going in that direction, it doesn’t feel appropriate now. We’ve been promoting this idea for bringing treatments out three or four years and now it’s really flying. I liken it to chair massage, when that started happening, it didn’t replace the one-hour massage in a quiet room, but it is in addition to that. Who would have thought that would ever happen? If people relate it to that. If you realize that massage is about muscle relaxation, it makes perfect sense that you would get that between flights. You can’t get into one of those seated chairs because they are packed. The seated chair massage hasn’t replaced the one-hour massage and the MicroZone, a 20-minute skin treatment outside of the room, doesn’t replace the one-hour in the room, it offers an alternative. It’s perfcect for this economic period.

Clients are reducing their spending on services. Dermalogica doesn’t sell to distributors, so we can talk to businesses about what’s happening with their business and we have a good barometer about what’s really going on. Services are down and in some as much as 28% from last year. The accounts that are heavily down, they are offering luxury pampering and indulgence. The accounts that are offering skin health, deep clean, those are still holding strong. The average spa is seeing drop in their services, the regular client who decided that they aren’t going to spend $100 on a treatment, they aren’t sure it’s doing anything for them. When they decide not to come in for a service, they feel weird about buying their products. Clients tell me that they feel strange if they are no longer going to that service provider, buying products. The end consumer doesn’t stop using the product, they look for an anonymous source to buy it from … we've seen an increase from our chain accounts.

As a manufacturer, we see this shift around where people are sourcing. Now this skin therapist is seeing a drop in clients and they aren’t seeing them buy products. You have to give clients the opportunity to come in and maintain their skin at a lower price point, a more results-oriented service and you have to give them permission to come in and buy product to maintain their skin at home. That brings us to the MicroZone 20-minute results-oriented treatment. Tell clients while they're cutting back on services, don’t let their skin go to hell; keep you exfoliation, extractions, hydration going, let’s come in for 20 minutes, have a MicroZone where you can focus on those aspects. It’s not a mini facial; we pick one priority and focus on that for 20 minutes. “You’ve invested so much in your skin, I would hate for your skin to suffer. Come in every few weeks and we’ll focus on extractions. Right now, let’s now let your skin circle the drain. If I have a more mature client , I would say you’ve done a good job on maintaining your skin, come in so we don’t have to rebattle back to that state in a year’s time. Figure out what is a client’s priority and eliminate all the other stuff that they don ‘t need.