Bernd Beetz, CEO of Coty, is confident the business will continue to grow, but warns of an economic storm looming on the horizon
As the fragrance licensee of Cerruti, Vera Wang, Chloé, Vivienne Westwood, Jil Sander and Marc Jacobs, Coty is the world’s largest fragrance company, reporting annual revenues in excess of $4 billion in 2010. The Reimann family owned conglomerate is increasingly becoming known for its strength in M&A;, completing five independent deals last year alone.
Bernd Beetz began his career with Procter & Gamble, going on to lead LVMH’s revitalisation of Cosmetics and Perfume as the CEO of Parfums Christian Dior. Mr Beetz joined Coty as chief executive officer in 2001 and is largely credited with the company’s double-digit sales growth in each of the last five consecutive years and a double in profitability.
Mr Beetz spearheaded the acquisition and integration of Unilever Cosmetics International (Calvin Klein, Cerruti, Chloé and Vera Wang) in mid-2005, part of the company’s strategy to offer a well-balanced portfolio of prestige & mainstream brands. We caught up with Mr Beetz to discuss the highlights of his ten years at Coty and present the fourth in our series of 5 Minutes With…
In your time at Coty, what has been your favourite memory?
My favourite memory, it is the creation of our culture, that is my fondest memory. The key reason for me to go to Coty was the opportunity to create a culture from scratch, which rarely happens as a CEO. I wanted to create a culture that was different to the experiences I’d had before. So far I think it is the biggest satisfaction of my career and I’ve really enjoyed seeing that coming through and working throughout the organisation, has really been a big pleasure and great memory.
Which market are you currently experiencing the strongest growth?
We have strong growth across all categories, our fragrance, skin and colour. As you probably know we had top line growth of 12% over the past 10 years and it’s across all our categories.
What is the next major launch you can tell us more about?
We have a number of launches to come. In the prestige area we are launching Bottega Veneta, we have Cavalli, which is launching very soon. We have Lady Gaga coming up in fall next year, so we have a number of major launches as a group. We also will launch Calvin Klein colour and some new projects for OPI. Innovation is out lifeblood and as a result we have a lot of launches coming up.
What is the biggest challenge brand will face in the coming years…
I think to maintain the momentum. We have a very strong momentum right now, we are very confident about our capabilities, however, I don’t see the world economy being without issues. I think there is still a cloud over the US, and also the EU, where there is all this discussion about Greece and Portugal. I think we’re going to have a lot of uncharted waters ahead of us. Therefore there is a need for us to be really agile and protect ourselves in case of changes to the global economy.
What one word best describes your strategy?
Our strategy is very clear, it has never changed. We are the world leader of fragrance and continue to build on our portfolio. We are now very strong in colour cosmetics in North America and in Europe, we have a strong portfolio with Philosophy, Lancaster and Skin and we also want to build that further. We also want to extend our presence in BRICS countries, maybe where we have not been strong in the past, but we are getting into China in a major way.
What is the next opportunity you would like your company to seize?
Our opportunities right now are notably in the BRICS countries, we have a strong development plan in place, especially in Asia, and we definitely wish to become a major part of that market.
If you could change any aspect of the luxury industry what would it be?
I wouldn’t change anything at the moment, as the luxury industry is doing very well.
For more in the series of 5 Minutes With … please see our previous conversations with luxury leaders as follows:
- Margareth Henriquez, CEO, Krug
- Gian Giacomo Ferraris, CEO, Versace
- Jean-Claude Biver, CEO, Hublot