Revlon

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Revlon, Inc.
Public
Traded asNYSEREV
Russell 2000 Index component
IndustryCosmetics, skin care, fragrances and personal care
Founded1 March 1932; 86 years ago (1932-03-01)
FoundersJoseph Revson
Charles Revson
Charles Lachman
HeadquartersOne New York Plaza
New York, NY 10004
U.S.
Key people
Ronald Perelman
(Chairman)
Debra Perelman
(President and CEO)
RevenueIncrease $2.334 Billion (2016)[1]
Decrease $0.138 Billion (2016)[2]
Decrease $-0.022 Billion (2016)[2]
Total assetsIncrease $3.024 Billion (2016)[1]
Total equityDecrease $-0.615 Billion (2016)[1]
Number of employees
5,700 (2016)[3]
ParentMacAndrews & Forbes (60%)
Fidelity Investments (20%)
Websitewww.revlon.com

Revlon, Inc. is an American multinational cosmetics, skin care, fragrance, and personal care company founded in 1932 and based in New York City.

History[edit]

Founding and Charles Revson control (1932-1975)[edit]

Revlon was founded in the midst of the Great Depression, 1932, by Jewish American brothers Charles Revson and Joseph Revson along with a chemist, Charles Lachman, who contributed the "L" in the Revlon name. Starting with a single product — a new type of nail enamel — the three founders pooled their resources and developed a unique manufacturing process. Using pigments instead of dyes, Revlon developed a variety of new shades of opaque nail enamel. In 1937, Revlon started selling the polishes in department stores and pharmacies. In six years, the company became a multimillion-dollar organization. By 1940, Revlon offered an entire manicure line, and added lipstick to the collection. During World War II, Revlon created makeup and related products for the United States Army, which was honored in 1944 with the Army-Navy "E" Award for Excellence.

By the end of the war, Revlon was listed as one of America's top five cosmetic houses.[according to whom?] Expanding its capabilities, the company bought Graef & Schmidt, a cutlery manufacturer seized by the government in 1943 because of German business ties. This acquisition made it possible for Revlon to produce its own manicure and pedicure instruments, instead of buying them from outside supply sources.

Stock market[edit]

In November 1955, Revlon went public. The IPO price was $12 per share, but it reached $30 per share within 8 weeks.

Divisions[edit]

In the 1960s, Revson segmented Revlon Inc into different divisions, each focusing on a different market. He borrowed this strategy from General Motors. Each division had its own target customer:

Acquisitions[edit]

In 1957, Revlon acquired Knomark, a shoe-polish company, and sold its shoe-polish line Esquire Shoe Polish in 1969. Other acquisitions, such as Ty-D-Bol, the maker of toilet cleansers, and a 27 percent interest in the Schick electric shaver company were soon discarded. Evan Picone, a women's sportswear manufacturer which came with a price tag of $12 million in 1962, was sold back to one of the original partners four years later for $1 million. However, the 1967 acquisition of U.S. Vitamin and Pharmaceutical Corporation made Revlon a leader in diabetes drugs.

The company began to market its products overseas at the end of the 1950s. By 1962, when Revlon debuted in Japan, there were subsidiaries in France, Italy, Argentina, Mexico, and Asia. Revlon's entrance into the Japanese market was typical of its international sales strategy. Instead of adapting its ads and using Japanese models, Revlon chose to use its basic U.S. advertising and models. Japanese women loved the American look, and the sales for 1962 came to almost $164 million.

In 1968, Revlon introduced Eterna27, the first cosmetic cream with an estrogen precursor called Progenitin (pregnenolone acetate), as well as introducing the world's first American fashion designer fragrance, Norman Norell. Later, Revlon launched Braggi and Pub for men, and a line of wig maintenance products called Wig Wonder.

In 1970, Revlon acquired the Mitchum line of deodorants. In 1971 Flex shampoo and conditioner was introduced.

In 1973, Revlon introduced Charlie. Geared to the under-30 market, Charlie model Shelley Hack in Ralph Lauren clothes, personified the independent woman of the 1970s. This was the first perfume ad to feature a woman wearing pants. Charlie raised Revlon's net sales figures to $506 million for 1973 and almost $606 million the following year. Shelley Hack appeared on Oprah in 2007 to talk about the power of these Charlie print and commercial ads. Their follow-up fragrance, Jontue, became the number two best seller.

Models[edit]

In 1973, model Lauren Hutton signed an exclusive modeling contract, agreeing to pose for Revlon's Ultima line for $400,000 for two years. She was featured on the cover of Newsweek for this ground-breaking cosmetics contract.[4] Additionally, famed photographer Richard Avedon was signed on as the exclusive photographer for the brand - another cosmetics industry first.[5]

Michel Bergerac control (1975-1985)[edit]

In 1975, Charles Revson died. Michel Bergerac, whom Revson had hired as President of the company, continued to expand the company holdings. Revlon acquired Coburn Optical Industries, an Oklahoma-based manufacturer of ophthalmic and optical processing equipment and supplies. Barnes-Hind, the largest U.S. marketer of hard contact lens solutions, was bought in 1976 and strengthened Revlon's share of the eye-care market. Revlon purchased Armour Pharmaceutical Company, a division of Armour and Company, from The Greyhound Corporation in 1977. Other acquisitions included the Lewis-Howe Company, makers of Tums antacid in 1978. These health-care operations helped sales figures to pass the $1 billion mark in 1977, bringing total sales to $1.7 billion in 1979.

In the mid-1980s, Revlon lost ground to Estée Lauder. Estee Lauder spent millions of dollars on numerous magazine ads featuring Czech supermodel Paulina Porizkova, shot by famed Chicago fashion photographer Victor Skrebneski. Revlon's share dropped from 20 percent to 10 percent of department store cosmetics sales. Sales at the drugstore also declined as Revlon lost shares to Noxell's Cover Girl brand. Revlon compensated with more acquisitions; Max Factor, Ellen Betrix, Charles of the Ritz, Germaine Monteil, Almay, Fermodyl, Lancaster, Aziza, and Halston. The 1977 acquisition of Carlos Colomer, a Spanish professional beauty supply distributor, brought Fermodyl and Roux and helped introduce Revlon to the world of ethnic care: Creme of Nature, Realistic, Lovely Color and Milk and Honey. In 1983 the company attempted an unsuccessful hostile takeover of Gillette. In 1989, Revlon became one of the first companies to replace animal tests with alternative safety testing methods.[6]

Revlon counter in New Zealand department store Farmers

Ronald Perelman control (1985-present)[edit]

On November 5, 1985, at a price of $58 per share, totaling $2.7 billion, Revlon was sold to Pantry Pride (later renamed to Revlon Group, Inc.), a subsidiary of Ronald Perelman's MacAndrews & Forbes. The buyout—engineered with the help of junk bond king Michael P. Milken—saddled Revlon with a huge $2.9 billion debt load, which became an albatross around the company's neck for years to come. Pantry Pride Inc. offered to buy any or all of Revlon's 38.2 million outstanding shares for $47.5 a share when its street price stood at $45 a share. Initially rejected, he repeatedly raised his offer until it reached $53 a share while fighting Revlon's management every step of the way. Forstmann Little & Company swooped in at $56 a share, a brief public bidding war ensued, and Perelman triumphed with an offer of $58 a share. Perelman paid $1.8 billion to Revlon's shareholders, but he also paid $900 million of other costs associated with the purchase.[7] Perelman filed suit in the Delaware Court of Chancery to force Revlon to accept Perelman's offer, and the resulting appellate decision, Revlon v. MacAndrews & Forbes Holdings, was a landmark case in determining the obligations of public company directors in hostile takeover situations under Delaware law.

Perelman had Revlon sell four divisions: two for $1 billion, the vision care division for $574 million, and the National Health Laboratories division which became a publicly owned corporation in 1988. Additional make-up lines were purchased for Revlon: Max Factor in 1987 and Betrix in 1989, later sold to Procter & Gamble in 1991.[8] Also in 1991, Revlon sold the Clean & Clear brand to Johnson & Johnson.

In March 2011, Revlon acquired Mirage Cosmetics, makers of Sinful Colors nail products.[9]

In 2011, PETA removed Revlon and other high-profile cosmetic brands from its list of companies who do not test their products on animals after the organization learned they were paying Chinese laboratories to test their cosmetics on rabbits and other animals.[10]

In August 2013, Revlon Consumer Products Corp. bought the Colomer Group from CVC Capital Partners, a private equity firm, for $660 million.[11]

After suffering business loss in 2011 and 2012, at the end of 2013, Revlon announced that it will exit the Chinese market, which employs 1,100 people. The business in China accounted for just 2 percent portion of net sales of Revlon's international operations.[12]

On November 1, 2013, Revlon named Lorenzo Delpani as President and CEO [13]

In March 2014, Revlon announced leaving midtown and relocate headquarters to the top the two floors of One New York Plaza.[14]

On September 22, 2014, Revlon's board of directors elected Roberto Simon as executive vice president and chief financial officer, effective as of Sept. 30.[15]

On April 30, 2015, Revlon completed the acquisition of U.K. based fragrance management company CBBeauty including its U.K. distributor SAS & Company.[16]

On June 16, 2016, Revlon announced to purchase its competitor Elizabeth Arden, Inc. for $870 million.[17] The acquisition was completed on September 7, 2016.[18]

The company announced on January 29, 2017 that CEO Fabian Garcia would leave the company at the end of February. Board member, Paul Meister, would become executive vice chairman of the board and run the day-to-day operations. A quarterly report from the end of 2017 estimated its quarterly loss falling approximately between $60 million and $80 million.[19]

In May 2018, the company announced the appointment of Debra Perelman, the daughter of Ronald Perelman, to the position of chief executive officer. She will be the first ever female CEO of the company after serving as COO starting in January 2018 and serving on the board since 2015.[20]

Advertising[edit]

Tram with Revlon advertising in Hong Kong, June 2007

Up until the 1940s, Revlon's magazine ads were drawn by hand and mostly in black and white. Beginning in 1945, Revlon began launching full-color photographic advertisements in major magazines and stores across the country. Revlon introduced matching nail polish and lipsticks with exotic and unique names. These ads were taken by the top fashion photographers of the day including Richard Avedon, Cecil Beaton, and John Rawlings. Some of these ads were for "Paint the Town Pink" and 1945's "Fatal Apple" with Dorian Leigh. In 1947 Revlon introduced "Bachelor's Carnation" and in 1948, "Sweet Talk".

In 1950, Revlon introduced a red lipstick and nail enamel called "Where's the Fire?" Revlon used the word "fire" again later in their "Fire and Ice" ads. One of the world's first supermodels, Dorian Leigh, starred in some of Revlon's most memorable advertisements of all time. In 1946, Dorian was covered in purple flowers and wrapped in a pale purple sheet for "Ultra Violet." In 1947, Dorian appeared in "Fashion Plate." In 1953, at the age of 36, she appeared in "Cherries in the Snow." Later that year she appeared in the legendary "Fire and Ice" ad shot by Richard Avedon. Originally, Dorian appeared in a tight, silver-beaded dress with an enormous red wrap. Her black hair had a silver swirl in it and she had her hands, with long red nails, positioned in front of her breasts. Charles Revson rejected Avedon's original ad as "too sexual."[21] They re-shot the ad, this time with her open hand in front of one hip, the other in front of her cheek. The advertisement became Madison Avenue legend because of the full-page quiz next to the sensual ad. Almost 50 years later, in November 2010, Revlon re-created 1953's "Fire and Ice" magazine ad, this time with actress Jessica Biel. With this ad, Revlon announced they were issuing a limited edition Fire and Ice lipstick and nail color calling this campaign, "lips and tips."

Dorian Leigh's 15-years-younger red-headed sister, Suzy Parker, also shot numerous Revlon magazine ads in the 1950s. Charles Revson, who wanted to marry Dorian at some point, despised Suzy, and vice versa. At one point, he refused to hire her anymore because Suzy complained about the "peanut" paycheck she received from Revlon. Richard Avedon, however, after photographing other models for a particular Revlon ad, would call in Suzy last minute, sometimes late at night, to do re-takes with him. This happened with "Stormy Pink," an ad Suzy shot very late at night with a wild white horse in the ocean. Avedon would then tell Revson that it was not Suzy in the ad, but a model named "Bubbles" or another made-up name.[22]

In 1970, Revlon became the first American cosmetics company to feature an African American model, icon Naomi Sims, in their advertising.[23] In the late 1970s, Revlon also made history when it created their line of cosmetics, specifically for women of color, called "The Polished Ambers Collection" and selected fashion model icon, Iman, to be featured in the advertising campaigns. Revlon was also noted for featuring models of a wide age range in the 1980s, including then 13-year-old Milla Jovovich and then 60-year-old Audrey Hepburn.[24] Despite the successful campaigns of the 1980s and 1990s featuring models, in particular Cindy Crawford, Revlon decided to drop fashion models and focus on movie stars, among them Kate Bosworth, Jaime King, Halle Berry, Susan Sarandon, Melanie Griffith, Julianne Moore, Eva Mendes, Jessica Alba, Jennifer Connelly, Beau Garrett, Jessica Biel, Olivia Wilde, Emma Stone and Bond girls.[25] In 2009, Australian supermodel Elle Macpherson became a new spokesmodel for the company. American actress Jessica Biel is the newest woman to model for the brand, first shown in advertisements in January 2010.[26] (Main article: List of Revlon spokesmodels) In 2008, celebrity makeup artist Gucci Westman was hired as Revlon's Global Artistic Director, representing the company at runway shows and brand events and designing collections.[27]

Philanthropy[edit]

Revlon is a corporate sponsor of several charity projects. The largest of these is the Revlon Run Walk, a run and walk event held in New York and Los Angeles to raise money and awareness for breast and ovarian cancer. Revlon also supports other cancer charities such as Look Good Feel Better and the National Breast Cancer Coalition and operates a mobile mammography clinic in and around Oxford, North Carolina, where the company's primary manufacturing operations are located.[28] In 1996 Revlon supported the development of a breast center at the University of California, Los Angeles. Renamed Revlon/UCLA Breast Center, the center is a well-known institute for treatment and research of breast cancer and other breast diseases and disorders.[29] A Revlon lip gloss shade whose proceeds support Revlon's cancer charities was also created in 2009.

In September 2010, Revlon, with global artistic director Gucci Westman and spokesmodel Halle Berry hosted an event at Fashion's Night Out in New York City to raise funds for the Jenesse Center, a Los Angeles organization for domestic violence victims.[30] Revlon also hosted luncheons and various other events to benefit the center and partnered with then-online retailer drugstore.com to donate portions of lipstick sales to the organization.[31]

See also[edit]

References[edit]

  1. ^ a b c "Financial Statements for Revlon - Morningstar". Morningstar.com. 2016-12-31. Retrieved 2017-03-08.
  2. ^ a b "Financials for Revlon". Google Finance. 2016-12-31. Retrieved 2017-03-08.
  3. ^ "Fortune 1000 page for Revlon". Fortune. 2016-12-31. Retrieved 2017-03-08.
  4. ^ Model, by Michael Gross, 1995, page 212.
  5. ^ "Andrewtobias.com". Andrewtobias.com. Retrieved 2011-04-06.
  6. ^ McGill, Douglas C. (August 2, 1989). "Cosmetics Companies Quietly Ending Animal Tests". The New York Times.
  7. ^ Stevenson, Richard (1985-11-05). "Pantry Pride Control of Revlon Board Seen Near". New York Times. p. D5.
  8. ^ "MacAndrews & Forbes Holdings Inc". Funding Universe. Retrieved 2008-05-16.
  9. ^ "Revlon Acquires Sinful Nail Brand". Women's Wear Daily. March 25, 2011.
  10. ^ Hills, Suzannah (July 31, 2012). "L'Occitane and Yves Rocher: The big-name beauty brands among those ditching cruelty-free animal testing policies to sell their products to China". Daily Mail. Retrieved 28 January 2015.
  11. ^ Young, Vicki M. "Revlon Acquires Colomer Group for $660 Million". WWD. Retrieved 6 August 2013.
  12. ^ "Revlon to Exit Operations in China, Cut 1,100 Jobs". January 1, 2014.
  13. ^ "Revlon Names Lorenzo Delpani President, CEO". October 31, 2013.
  14. ^ "Revlon says so long to Midtown, hello to One New York Plaza". New York Post. 2014-03-05. Retrieved 2017-11-28.
  15. ^ "Revlon Inc announces election of Roberto Simon as executive vice president and chief financial officer - Form 8-K". September 23, 2014.
  16. ^ "Revlon Completes Acquisition of CBBeauty and SAS & Company". BusinessWire. 2015-04-30. Retrieved 2017-10-31.
  17. ^ "Cosmetics maker Revlon to buy Elizabeth Arden in $870 million deal". Reuters. 2016-06-16. Retrieved 2017-10-31.
  18. ^ "Revlon Announces Completion of Elizabeth Arden Acquisition". BusinessWire. 2016-09-07. Retrieved 2017-10-31.
  19. ^ "Revlon's CEO departing amid expected steep losses". USA TODAY. Retrieved 2018-01-30.
  20. ^ Staff, Writer (2018-05-23). "Revlon Just Appointed a Woman CEO for the First Time Ever". Fortune. Bloomberg News. Retrieved 2018-05-24.
  21. ^ The Girl Who Had Everything, The Story of 'The Fire and Ice Girl,' by Dorian Leigh and Laura Hobe, 1980, page 88.
  22. ^ The Girl Who Had Everything. The Story of the "Fire and Ice Girl," Dorian Leigh and Laura Hobe, 1980, page 89.
  23. ^ Tell Me More (2009-08-05). "Naomi Sims Showed The World That Black Is Beautiful". NPR. Retrieved 2011-04-06.
  24. ^ "The Official Milla Jovovich Website :: Gallery - Revlon". MillaJ.com. Retrieved 2011-04-06.
  25. ^ "Stylenews.peoplestylwatch.com". Stylenews.peoplestylewatch.com. Retrieved 2011-04-06.
  26. ^ "Marketing News". HAPPI. Retrieved 2011-04-06.
  27. ^ "Revlon Taps Gucci Westman - Beauty Industry and Products News". WWD.com. Retrieved 2011-04-06.
  28. ^ "Revlon Cares". Revlon.com. Retrieved 2011-04-06.
  29. ^ "About Us". Revlon/UCLA Breast Center.
  30. ^ "Revlon and Halle Berry Celebrate Fashion's Night Out New York". Business Wire. 2010-09-14. Retrieved 2011-04-06.
  31. ^ Thomas, Bobbie (2009-12-15). "Shop for change! Top gifts that give back - Holiday Guide - TODAY.com". Today.msnbc.msn.com. Retrieved 2011-04-06.

External links[edit]