COSMETIC INDUSTRY
AUGUST 30, 2023
Revlon : The Up And Down Of A Cosmetic Giant
This US cosmetic giant company is one of the biggest names in cosmetic industry for 90 years until they filed for bankruptcy last year.
On March 1, 1932, two brothers Charles and Joseph Revson, together with a chemist named Charles Lachman for the first time founded the Revlon brand. The brand name is taken from the last name Revson, with the letter ‘S’ replaced by the letter ‘L’ which is taken from the last name Lachman.
In the midst of the Great Depression era in the United States, the three founders of Revlon also launched their first product, namely nail polish or nail color using pigment ingredients—different from other nail dyes that use other ingredients. Revlon’s red nail polish was an instant hit among the US public.
BUSINESS EXPANSION
Within 6 years this company developed into a business with assets of millions of dollars. In 1937, Revlon began selling its cosmetic products to many outlets, salons and beauty shops in America.
In 1940, Revlon expanded its line with lipsticks. This Revlon lipstick collection was inspired by a woman who did not wear matching lipstick and nail polish colors, thus prompting Charles Revson to launch a lipstick collection with the concept of “matching lips and fingertips.”
Entering the 1950s, Revlon sold its hard-selling products all over the world, including Italy, Japan, France, Argentina, to Mexico.
PRODUCTS DIVERSIFICATION
After selling lipsticks and nail polish which were a huge success, Revlon has also innovated by launching various other beauty products, ranging from perfumes, deodorants, shampoos and conditioners, to various new makeup collections.
In 1952 Revlon launched a perfume called “Fire and Ice”, which was advertised on the radio by Bob Hope and Red Skelton. In 1955, Revlon sponsored the CBS quiz show The $64,000 Question.
In the 1960s, Charles Revson divided Revlon into several divisions for different markets. He copied this strategy from General Motors.
One of the products launched by Revlon, namely Charlie perfume in 1973, immediately became the number one perfume brand in the world at that time. Revlon’s name skyrocketed after they became the first beauty brand in the United States to have a black model. Naomi Sims became a model in Revlon advertisements in 1970.
Entering the 1980s, Revlon became increasingly known for its campaigns starring supermodels of its time, such as Iman, Claudia Schiffer, Cindy Crawford and Christy Turlington. Furthermore, other top celebrities have also become the faces of this brand, such as Halle Berry, Julianne Moore, Eva Mendes, Audrey Hepburn, and Jaime King.
THE DARK ERA
Unfortunately, over time, Revlon’s massive success was slowly met with setbacks. One of the factors was the emergence of big business rivals such as Estee Lauder and Cover Girl which began to grace the makeup world in the United States in the 1990s.
Revlon’s efforts to increase sales were successful after they bought Elizabeth Arden and Cutex in 2016, but this success was only temporary.
The COVID-19 pandemic has further exacerbated the situation. Restrictions on activities and wearing masks have reduced the popularity of makeup, including lipstick. In 2020, Revlon managed to avoid filing for bankruptcy after entering into an agreement with the debtor.
INEVITABLE BANKRUPTCY
In addition, chaos in the global supply chain, such as raw material shortages and rising raw material prices, also made it difficult for Revlon.
Until finally, Revlon decided to file a bankruptcy protection petition (Chapter 11 bankruptcy protection) in mid-June 2022. As a result, Revlon’s shares immediately fell 13 percent after a few hours of the bankruptcy announcement.
At the US Bankruptcy Court for the Southern District of New York, Revlon listed assets and liabilities of between US$1-10 billion. This debt has occurred since the management of Debra Perelman since 2018. Until now, the debt has reached US$ 3.31 billion.
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