Art of Shaving says new Gillette blade sales solid

CHICAGO Thu May 13, 2010 11:33am EDT

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CHICAGO (Reuters) - New Fusion ProGlide blades were the best-selling product at The Art of Shaving last month as Gillette tests out its biggest salvo in the razor wars since 2006.

The upscale men's grooming boutique got a head start in selling the blades after being acquired by Gillette's owner, Procter & Gamble Co (PG.N), last year.

Fusion, launched in 2006, is the top-selling blade and razor brand in the world. It reached a milestone of $1 billion in annual sales faster than any other P&G product and was the first major Gillette launch after it was acquired by P&G.

Launching the blades at The Art of Shaving helped P&G get the attention of affluent professional men who typically shave before heading to work each day -- and can afford items like $55 shaving brushes made with badger hair.

Eric Malka, who opened the first The Art of Shaving store with his wife in 1996, tested Fusion ProGlide in late March and called the blades the best he has ever tried.

Fusion ProGlide will not hit most stores until June 6. Mass merchants, drug stores and club stores are just starting to get razor sample kits. But The Art of Shaving got to sell the blades, which feature thinner, finer edges, in April.

The blade cartridges are "selling extremely well," Malka said during a phone interview from his Miami office, where he is working on expansion plans with the financial backing of the world's largest household products company.

A $40 set at The Art of Shaving has eight Fusion ProGlide blades packed alongside trial sized bottles of the chain's pre-shave oil, shaving cream and after-shave balm and a badger hair brush. Another set with a chrome power razor and eight of the blades is on sale for $150 at stores and online.

Malka said his sales are picking up after a tough 2009, when the economic downturn forced even well-heeled men to cut back on purchases such as $175 engraved razors.

"We really are seeing a nice rebound of our business. Since last October it's been progressively getting better," he said.

ACQUISITION BENEFITS

Marrying higher-priced Fusion ProGlide blades with The Art of Shaving's stores is a new way for P&G to court upscale shoppers. P&G also bought the luxe Zirh men's skin-care brand last year.

Meanwhile, smaller rival Energizer Holdings Inc (ENR.N) is going after mainstream shoppers with its Schick Hydro line, which debuted last month.

Malka called the June 2009 acquisition by P&G "a very positive experience so far" and said he has no plans to leave.

"P&G's focus on winning with men is perfect for us," Malka said. "We've been putting resources in all the right places to make The Art of Shaving a major brand."

With the backing of P&G, The Art of Shaving retrofitted two stores with a more masculine look, including dark wood paneling and a modern club-type atmosphere, a prototype that was led by Malka's wife, Myriam Zaoui. The remodels, done in early 2010 in Atlanta and Miami, have outperformed the rest of the company.

The chain just entered the Chicago market, with one store downtown and another in suburban Schaumburg, Illinois. The design will be the basis for all new stores and remodels.

Comparable sales are up 30 percent to 40 percent over 2009 levels this year and are higher, but to less of an extent, than in 2008, which was The Art of Shaving's best year ever.

Malka said he has strong expectations for 2010 but would not give a sales forecast.

His company plans to add more locations in the 20 U.S. markets where it already operates with about 40 stores, and aims to grow internationally. For now it sells through overseas department and specialty stores and has one store in Moscow, where business is coming back nicely, Malka said.

A real indicator of the "overall confidence consumers have" is seeing sales rebound in markets that were particularly hard-hit, such as New York and Las Vegas, he added.

The Art of Shaving will enter Charlotte, North Carolina, in July. There are no plans to open up shop in P&G's hometown of Cincinnati, but it "absolutely" could happen, Malka said.

(Reporting by Jessica Wohl, editing by Gerald E. McCormick)

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