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• Accounting by new rules : Reporting of retail expenses may prove a boost to in-store media (Adverting Age, July 15,2002)
• Finesse Virtual Hairstyler - A look back in time!
• Revlon High Dimension Across America Tour
• Time for a new you? Try finding
it on the Internet.
• Web technology helps create a million new looks.
Accounting by new rules : Reporting of retail expenses may prove
a boost to in-store media
ADVERTISING AGE -
July 15, 2002 - As package-goods marketers come to grips with how new accounting
treatment of promotion spending is hurting their financial statements, a growing in-store media
industry is angling to profit from their discontent.
Most package-goods marketers are starting to grasp the full impact of new accounting rules requiring
that price givebacks to retailers and consumers be deducted from revenue rather then reported as marketing
expenses, said Ken Harris, partner with Cannondale Associates, Evanston, Ill.
The rules, which were developed by the Financial Accounting Standards Board and took effect late last year,
were originally intended to skim promotional froth from top lines of dot-coms. But they possibly have had a
bigger impact on package-goods marketers.
Some, such as Procter & Gamble Co. and Unilever, have long accounted
for promotion spending this way. But Cannondale research indicates
the new rules will cut reported net sales for package-goods companies
on average by 8.5% this year, cut reported marketing spending by
half or more in many cases and slash the industry's five-year average
annual sales growth rate by nearly a third, from 2.9% to 2%.
Earnings are not affected, but the impact of promotion spending on both revenue
and marketing outlays appears to be a growing quality-of-earnings
issue for investors, particularly in the era of post-Enron scrutiny,
said Jim Gingrich, analyst with Alliance Capital Management's Sanford
C. Bernstein.
HARD LOOK
The new rules have made marketers take a harder look at promotion spending despite retailer pressure.
For the first time in five years, the share of package-goods marketing
budgets earmarked for total trade promotion went down last year,
according to Cannondale's recently released survey, though only
to 59% from 61%.
Retailers complaining they aren't getting their fair share of trade dollars rose to 46% this year from
37% in 2001, while 61% of manufacturers said they'll evaluate promotion spending
more closely and 26% expect to cut it.
But the FASB rules draw a line between pure price rebates and payments for in-store or co-op
advertising and events. Marketers still can count the latter payments
as marketing expenses to the extent they're not linked to the retailer's
purchase of products and reflect fair market value. Marketers clearly
want to see what's in store: At the AdWatch: Outlook 2002 conference
in June, James Stengel, P&G's global marketing officer, noted P&G's
interest in reaching the vast number of shoppers at outlets such
as Wal-Mart Stores using in-store media.
LOOPHOLE
A growing array of retailer-owned media, such as in-store TV, radio and billboards
at Wal-Mart, Kmart Corp. and Kroger Co., could drive business through
that loophole, and other emerging in-store media concepts could
also benefit.
Among them is Approach Infinity Media, Toronto, which
recently has launched interactive makeover kiosks that take pictures
of consumers, then let them virtually try on cosmetics or new hair
colors and styles. Unilever is using the kiosks in a current mall
tour in conjunction with iVillage to back a relaunch of its Finesse
hair-care brand later this month, and Revlon is using them for a
similar tour of its own to launch High Dimension hair color. Coty's
Rimmel cosmetic brand has used the kiosks on double-decker buses
for promotions at Wal-Mart Stores.
But Steve McPhee, sales and marketing director for Approach Infinity, is also pitching
the kiosks to retail chains as an in-store "retail-tainment" concept that they would
own and in turn sell to marketers on a rotating basis. Mr. McPhee
said chains in the U.S. and Canada are set to begin testing the
kiosks as permanent in-store displays by year end.
Favorable accounting treatment might be "an ancillary benefit" for Approach Infinity,
he said, but he sees primary drivers as in-store fun and the ability
to target shoppers at the time they're making decisions and use
data to develop shopping lists and loyalty programs. Approach Infinity
claims the kiosks can generate sales lifts of 50%.
Onvance InStore Advertising Network, founded by a group of petroleum companies that
operate convenience stores and launched last month in more than
500 convenience stores, could also benefit from the new rules. The
network, which places several monitors in each store running a mix
of 40% entertainment programming and 60% advertising, benefits retailers
by creating an average sales lift of 7.8% and providing free satellite
broadband access, though they don't share in ad revenue, said Gerard
Coelsch, VP-marketing.
Onvance plans to eventually reach 30,000
stores, or about a quarter of the 125,000 in the U.S. Given an average
convenience store's daily customer count of 1,100, the network could
have an audience of more than 30 million, said Mr. Coelsch. Even
at startup levels of more than 500,000, its audience exceeds that
of some cable news networks, he said.
EARLY BIRDS
Early advertisers include both convenience store regulars like PepsiCo's Frito-Lay
and Aquafina, and non-convenience store brands such as Levi Strauss
& Co. and credit-card issuers. Though advertisers can use existing
ads, Mr. Coelsch said ads specifically tailored to the network,
including a strong promotional call to buy and tie-ins to displays,
can more than double per-store sales. Mr. Coelsch said he is hearing
some marketers cite the accounting change as a factor that could
drive budgets from conventional trade deals to in-store media. It's
a touchy subject, since some of Onvance's outlets could lose trade
dollars as a result. "I don't necessarily favor [that thinking],"
he said. "But if it does happen, I think we benefit."
Article by Jeff Neff for Advertising Age. Copyright (C) 2002 Crain Communications, Inc. All rights reserved.
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Finesse Virtual Hairstyler - A look back in time!
TORONTO, ON -
- In 1982, Finesse entered the American consciousness
with the memorable jingle: "Sometimes you need a little Finesse,
Sometimes you need a lot". Over the past twenty years, the brand
has been a constant feature of pop culture, with stars such as Sharon
Stone, Rene Russo and Heidi Klum appearing as the face of Finesse.
In celebration of the company's 20th anniversary, Approach Infinity
Media (AI-Media) has created a Virtual Hairstyler Kiosk that takes
you back in time.
The Finesse Virtual Hairstyler takes you back into the past decades, allowing you to try on hairstyles of the 60's, 70's, 80's and 90's.
The Virtual Hairstyler Kiosk is part of Finesse's Hairevolution tour that is travelling across the United States. Please check the schedule
of when the tour is coming to a city near you.
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Revlon High Dimension Kiosk radiantly shines!
TORONTO, ON-
- Approach Infinity Media (AI-Media), a
Toronto-based application service provider (ASP), is proud to announce
the unveiling of its first kiosk. The kiosk uses state of the art
technology combined with creativity delivers a Virtual Makeover
Kiosk that is like no other. The Revlon High Dimension Kiosk gives
users the unprecedented ability to try multiple hairstyles instantly.
Users get their photos taken digitally and they can instantly try
on hairstyles of all shapes, sizes and color. It only takes 10 minutes
out of your day to stop by and consult with Revlon's color experts.
And discover how High Dimension delivers rich, dimensional haircolor
that leaves your hair soft, shiny ...beautiful. It is currently
touring around all major cities across America. Check out the schedule
of when this tour will be visiting a city near you.
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Time for a new you? Try finding it on the Internet.
TORONTO, ON - - Approach Infinity Media
(AI-Media), a Toronto-based application service provider (ASP),
is proud to announce the launch of its virtual makeover tool at
www.MakeoverSolutions.com. MakeoverSolutions gives users the unprecedented
ability to try cosmetic products and hairstyles instantly over the
Internet. Users can scan a photo or take a digital picture and then
upload the shot into the Personal Makeover web application. Within
minutes, she can begin to enhance her image by clicking on the latest
hairstyles or selecting different shades of lipstick. Visitors can
also try new looks by choosing from one of the many models provided
on the site.
MakeoverSolutions is powered by the same proprietary AI-Media technology
currently used on Internet portal iVillage (IVIL), the most popular
women's destination site in the world. iVillage selected AI-Media
over several larger companies, largely because of the degree of
customization offered as well as Personal Makeover's user-friendly
interface.
MakeoverSolutions offers women a chance to try makeup
products online in a faster, risk-free environment. The comfort
of a home computer is a stark contrast to the intimidation that
many women feel when approaching the cosmetics counter at their
local department store. Users can even save their favorite new looks,
email them to friends for comments and even print out a "before
and after" picture before making any final buying decisions.
Established in 1999 and privately funded, AI-Media
is quickly establishing itself as a leading provider of online sales
and marketing tools to the fashion and beauty industries. Targeting
cosmetic companies and online retailers that sell apparel or cosmetics,
we hope to help reduce lost sales because colors and textures do
not translate well online or because shoppers have a hard time picturing
what cosmetics will look like on them.
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Web technology helps create a million new looks.
TORONTO, ON - Approach Infinity Media (AI-Media)
is excited to announce that 1 Million women have used their Virtual
Makeover technology to perform cosmetic makeovers on-line. MakeoverSolutions
gives users the unprecedented ability to try cosmetic products and
hairstyles instantly over the Internet. Users can scan in a photo
or take a picture with a digital camera and then upload the shot
into the Personal Makeover web application. Within minutes, she
can begin working on her image by clicking on the latest hairstyles
or selecting different shades of lipstick. Visitors can also try
new looks by choosing a similar-looking model.
AI-Media's proprietary makeover technology can be
found powering the "Makeover-O-Matic" on iVillage.com
(IVIL), the leading on-line women's network and on AI-Media's own
website, Makeoversolutions.com.
"What has been most exciting for us is that women have truly
embraced our technology to help them select the cosmetics which
give them the look they're after", says Steve McPhee, Director
of Marketing. Women use the tool for an average of 18 minutes, trying
on options from eight different categories (hairstyles, lipstick,
lip-liner, eye shadow, eyeliner, hats, glasses and sunglasses).
"We set out to design a tool which would be fun, useful, and
allow women to experiment with cosmetics in a low cost and low risk
environment. Proof that we have succeeded in our mandate is shown
in the large number of users that have uploaded their own picture,
allowing them to come back again and again to experiment with new
looks." McPhee adds that in addition to uploading their own
pictures, another popular feature is the ability to print and email
'before & after' looks to others.
About Approach Infinity Media
Founded 1999, Approach Infinity Media has quickly set the standard
in on-line makeover tools. The company is privately held and funded
by the founders and management team. AI-Media operates as an application
service provider, licenses for its proprietary makeover technology
are available to both cosmetic companies and on-line publishers.
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