Goldman Sachs Global Staples Forum: Olaplex CEO talks ‘reset year,’ Edgewell and Harry’s discuss disruption

Brands talked ups, downs, and turnarounds at the event.
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· 4 min read

At Goldman Sachs’s annual Global Staples Forum, CPG brands broke down their latest results and the recent successes and shortcomings their businesses have been facing.

Within the beauty, health, and personal-care categories, there were familiar narratives, like changing category dynamics and sizing up the competition in the space…and then there was Olaplex, which is still grappling with the fallout from accusations that its products cause hair loss.

We’re breaking down some of the biggest takeaways from the day.

A hairy situation: Olaplex, which was founded in 2014 and went public in 2021, is in the midst of a “reset year,” following “a lot of misinformation” that’s hampered sales, according to president and CEO JuE Wong. The company has struggled amid claims that its products cause hair loss and other scalp issues, facing a lawsuit from a group of nearly 30 consumers filed earlier this year. In response, Olaplex in February released the results of third-party tests indicating its products are safe.

In its Q1 earnings call this month, the company reported its net sales were down nearly 40% and gross profit dipped 42.8% year over year. It’s now looking to get to “a stronger and better place,” Wong said, by investing more in sales and marketing, working closely with stylists in the professional channel (who Wong noted “struggled” with the hair-loss claims), establishing “a more assertive” PR program, and forming a scientific advisory board, Wong said. She claimed that negative sentiments are trending down, though some recent customer reviews on sites like Sephora continue to claim its products cause bald spots and hair loss.

“We are empathetic to the people going through this emotional toll,” she said. “But we can categorically say, with the testing that we have done with the information that we have on our health hub, we are confident that our products do not cause hair loss.”

She also noted Olaplex is working to address consumer confusion about its original product, a bond-building hair treatment, which many still incorrectly believe is a protein mask. “After nine years of hearing the same song, they are still singing the wrong lyrics. So we need to correct that,” Wong said.

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Close shave: Edgewell, owner of brands like Schick, Banana Boat, Wet Ones, and Playtex, has been in the midst of a strategic turnaround for about three years, moving away from a focus on shaving and feminine care to grooming and sun, categories that CEO Rob Little said have a “more attractive growth profile.”

After the FTC blocked its proposed purchase of Harry’s in 2020, it acquired women’s personal-care brand Billie in 2021. Billie, which entered Walmart last year and offers products including shave cream, makeup remover, and dry shampoo. After going up against category disruptors like Harry’s in the shave space, it’s aiming to itself lead “disruption in some new categories,” Little said.

“We’re in a position where the disruptors have done their thing,” Little said. “There’s no more IP or innovation to go. It’s like they are where they are. And from here, it’s who can innovate better, who can create better solutions for consumers, who can connect with consumers more and more digitally, and via social media, ultimately, to drive sales and share.”

And speaking of Harry’s, co-founder and co-CEO Andy Katz-Mayfield at the forum also shared the company’s continuing growth, notching $672 million in revenue in the 12 months preceding Q1 2023 and upping its gross margin to 50%.

The company, which owns five brands, including Flamingo, aims to operate seven to eight brands by 2025, potentially branching out into categories like beauty, homecare, or baby. The brand is functioning a bit differently from large CPGs, structured more like a holding company (“more LVMH, less P&G,” Katz-Mayfield said). He said it’s taking a consumer-first approach by introducing products initially through DTC, avoiding a focus on “category captaincy” that sees big CPGs producing new products largely in an effort to protect retail shelf space.

“There’s this narrative out there that is based in some truth that DTC was a nice fad, but you can’t build a scaled, profitable business,” he said. “It’s a really powerful way to launch tests, learn, iterate, build awareness, build a loyal early adopter base, and then you can bring that to omnichannel.”

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