FRANCE INVADES ITALY: SEPHORA REPORTEDLY ABOUT TO BUY LAGUNA.

WWD June 22, 1999 | Cooperman, Jackie MILAN — Sephora, the French perfumery chain owned by LVMH, appears close to gaining a major foothold in Italy, one that could shake up the beauty business there in profound ways. go to website sephora coupon code

The giant French chain reportedly is in advanced talks to acquire the 46-unit Laguna perfumery chain — one of the largest Italian-owned beauty businesses in the country — and Sephora lawyers are expected to arrive in Italy this week to sign the deal.

Executives at Progen, which owns Laguna, declined comment Monday. But according to sources close to the company, Luigi Dalla Costa, Progen’s chief executive officer, told his employees last week that a deal was imminent.

Officials at LVMH Moet Hennessy Louis Vuitton were not immediately available for comment.

Sources speculated that Sephora could pay up to $27 million for the Laguna chain, which reported sales of $56.2 million in 1998.

Sephora already has a small base in Italy. In March 1998, the company purchased a seven-door northern Italian chain called Kharys, which it acquired from Beaucour Investissements.

But if the Laguna deal goes through, it will put Sephora on an entirely different plane.

Although it remains to be seen what effect a major Sephora presence would have on Italy — where small perfumeries dominate the market — some insiders are already speculating that this deal could signal the end of the Italian beauty business as they know it. Last year, Sephora was projecting a worldwide volume of $1 billion by 2002, but it has probably raised its sights significantly since then, considering the recent success it has enjoyed in the United States.

“This means the entrance of a really significant competitor on the Italian market,” said Mario Verduci, president of Fenapro, the association of Italian perfumeries. “Sephora is an international competitor, as opposed to an Italian one like Laguna is, and it means that the Italian perfumeries will have an increasingly competitive, warlike environment and one more like the other European countries.” Sephora has managed to shake up the beauty retail scene in most countries it has entered, but none more than the U.S. Major prestige retailers there have been examining the way they sell cosmetics and fragrances in the wake of Sephora’s arrival last year, and some, including Bloomingdale’s and Macy’s West, have gone as far as renovating their beauty departments in response.

What has been so revolutionary about Sephora is that the stores feature products in an open-sell environment where all display units are approximately the same size, rather than behind counters that are sized according to sales results, as in most department stores.

Black-clad sales associates are trained to be low-key rather than assault shoppers with the “spritzkrieg” often associated with bigger stores, and the varied product assortment ranges from Estee Lauder to Stila to Shu Uemera. The merchandise is displayed according to category — color, fragrance and treatment — and there are no gift-with-purchase promotions. in our site sephora coupon code

Market sources said the $27 million Sephora reportedly is prepared to pay for Laguna appears reasonable, especially since Marbert was reported to have paid a similar amount to acquire the Limoni perfumery chain last September.

“Sephora could be in a position to pay that much,” said Maruska Colantoni, marketing director of the 70-door Limoni operation. “Laguna is very well positioned and very efficient. It’s an important entry ticket for Sephora.” The 10-year-old Laguna and Sephora already have a couple of things in common. Unlike traditional Italian perfumeries, they emphasize open service and position their stores in highly trafficked town centers. On March 18, for example, Laguna opened a 3,500-square-foot store in Duomo square here.

“It is fundamental to us to have a central position,” development director Mario Esposito said then.

At least one Italian perfumery chain said it was prepared for Sephora’s invasion and not surprised by the dramatic development.

“We’ve been preparing for this for a long time,” said Limoni’s Colantoni.

Cooperman, Jackie