Jess Bell, the second president of Bonne Bell Inc. and son of founder Jesse G. Bell, recalls the time he was speaking before a group of senior citizens and posed the question: “Have any of you heard of Bonne Bell?”
Somewhat to Bell’s surprise, a dozen hands went up. One member of the crowd actually pulled the company’s most successful product, a Lip Smacker, from her pocket and held it aloft in the air.
If you’re unfamiliar with Lip Smackers or Bonne Bell odds are that you never have been a teenage girl. For the uninitiated, Bonne Bell and the three generations of Bells that have run the company since 1927 are in the business of beauty.
A key component of the company’s 75 years of success has been well-timed product launches – 10-0-6 in the late 1930s and Lip Smackers in the early ’70s. Another is the family’s ability to latch onto, and continue to appeal to, the teen and pre-teen market.
When it debuted in 1973, Lip Smackers was the first flavored lip gloss to hit the market. For those of us who grew up then, it was more than lipstick. It was a social necessity. But the appeal of the big fat tube of grape-flavored lip-stuff is just one part of Bonne Bell’s story. That’s because being first to market doesn’t ensure success.
So how has this 75 year-old family-owned firm remained an industry leader in the company of the corporate powerhouses in the cosmetic world?
Innovative ideas? Yes. Quality products and good timing? Absolutely. But what has really kept Bonne Bell a leader is its ability to stay cool and understand its target market – teenage girls.
The simple fact is, teenage girls like make-up. That’s one of the few constants there are with Bonne Bell’s audience. Tween and teens have always influenced some of their parents’ purchases, but now they have markets of their own and they know exactly what they want.
“Today, both parents work, so grandparents tend to indulge,” explains Jess Bell, who also points out that many teens work or have sizable allowances to augment their purchasing power.
So not only has the size of Bonne Bell’s market grown, but so has the spending volume of its customer base. Teens and tweens represent 40 million consumers that spend an aggregate $155 billion each year. And, according to the market research firm Teen Research Unlimited, girls and boys between the ages of 13 and 19 last year anted up more than $9 billion for cosmetics, fragrances and other beauty products.
A “tween,” in marketing terms, is someone between the ages of 8 and 12, explains Jeff Stein, managing director of McDonald Investments. There are a few other things to know about this group.
They are growing. Census estimates predict the number of children in the U.S. between the ages five and 14 to reach 40.4 million by 2003.
They make money. About $12 billion a year by most estimates.
And, they spend money. Stein puts that number around $90 billion a year. They are, he says, “a very fickle group.”
“It’s a tough demographic to predict,” says Stein. “They don’t know that we are in a recession. They don’t care when interest rates go up or down. It’s all about what is the latest and greatest.”
Teens respond to market influences in a very different way than adults.
With adult markets, a company’s options are infinitely greater. A single brand can appeal differently to the family man, with promises of security and stability, or the working woman, with efficiency and quality. But the youth market doesn’t look at things that way. With them, it’s all about the latest trend. And trends are nearly impossible to anticipate.
In the traditional manufacturing town of Cleveland, Bonne Bell is one of the oldest and most successful family-run businesses. But instead of large steel beams and machine parts, the Bells deal with big vats of sweet smelling pink wax and glitter powder.
The company was founded in 1927, after the senior Jesse G. Bell moved his family across the country. Today, Bonne Bell is run by Jess “Buddy” Bell, grandson of Jesse G. Bell, and son of the charismatic Jess Bell. Two other Bells are key members of the senior management team – Hillary Bell, Buddy’s wife and director of brand development, and James Bell, Buddy’s brother and the company’s senior vice president. And, as it is with many family businesses, every member of the Bell family can recite the story of Jesse G. Bell and his trek to Cleveland to start the cosmetics company.
“My grandfather started by producing products on a hotplate in the back of an apothecary,” says James Bell, senior vice president of international business development. Back then, cosmetics were sold door-to-door out in the field. Bell saw an opportunity. “He realized that women’s cosmetics was recession-proof. He could go to any community, no matter what the economic level, and sell.”
Bell then sought out a central location from which to sell his product.
“Whenever he heard of a salesman wining an award, the guy was from Cleveland,” James recalls.
The senior Bell tells the same story.
“He had never been to Cleveland before,” says Jess, picking up the tale from where his son left off. “What he did know is that Cleveland is within 500 miles of half of the population of the U.S. and that it must be a salesman’s paradise.”
The company, named after Jess Bell’s sister, Bonne, began by offering a limited line of women’s face powder and cleansing or vanishing cream. With that as its core product, Bonne Bell survived the Great Depression. But it wasn’t until 1936 when the company’s first signature product left its mark on the cosmetics industry. Until then, Bonne Bell was just another in a growing line of adult cosmetics firms. Formula RX1006, which was later shortened to 10-0-6, marked a turning point for the company.
“From that day the company had direction,” explains Jess Bell.
As an astringent face cleanser, 10-0-6 was initially marketed as a woman’s product. But it was more than that. Ten-oh-six was, in fact, a harbinger for the direction the company would eventually move.
There’s a distinct odor that hangs in the air at the Bonne Bell production facilities in Westlake. You can smell it the moment you reach the parking lot. That smell attaches itself to your clothes and leaves with you. It’s the smell of childhood, of giggling girls, and roller skating parties.
The company’s production facility is housed in what can best be described as a Kentucky farm house. It’s large, meticulously clean and well lit. In the middle of the facility are huge 700-gallon vats of pink thick goo that fill a half-million bottles, sticks and pots every day.
James Bell says the proprietary blended base of Lip Smackers is not what makes it one of the leading products in the cosmetic markets. “It’s the flavor and the fragrance that gives it the real pop,” he says, adding that the basic ingredients of Lip Smackers are not very complex. “We have a blend of five waxes. With the truth-in-labeling laws, anyone with a basic knowledge of chemistry can reproduce (it).”
In fact, for the first time in its corporate history, Bonne Bell executives applied for a patent, for Lip Sours, a tangy, citrus flavored lip product.
“It’s innovative,” explains Bell.
When asked if Lip Sours is the first sour lip product in the market, Bell is quick to say, “It’s not the first, but it’s the best.” And, while that doesn’t mean the product will definitely be another Lip Smackers, it does indicate one thing – in this highly competitive marketplace, the Bells have learned to move fast.
“One of our strengths is that we can react quickly and have a good knowledge of the consumer,” James says. As proof, he points to the moisturizing and protecting ingredient in Lip Smackers, the improvement in raw materials and the meticulous testing and quality assurance at the Westlake production facility.
The more you learn about the company, the more you realize that although it’s all part of the finished package, a Bonne Bell product is more than a sum of its parts.
Ironically, it was during the make-up minimalist ’70s when Jess Bell brought to market the company’s most successful product line, Lip Smackers. In 1973, when the first iteration of Lip Smackers was rolled out, it was the first flavored lip gloss to hit what was a suddenly expanding teenage and youth market.
By then, the company had long abandoned the adult cosmetic market to focus on girls in their late teens. It was in response to a landscape that changed dramatically after World War II. The Bells recognized the emergence of a distinct teen market, and with it, vehicles like the new Seventeen Magazine, where Bonne Bell could properly target its products.
“Nineteen fifty-seven brought the beginning of the baby boomers,” says Jess. “We saw that a market was developing in the teenagers. We realized we were up against too much competition with the 35-and-older market.”
Businesses like Arden and Revco held a veritable lock on the mature audience. Bell and his father understood that the competition was simply too steep to continue in their current market space.
“At the time, no one was promoting or marketing to the teenager, so we moved totally in that direction,” Bell says.
It was an easy decision to make because the company had been struggling. It paid off, injecting Bonne Bell with new life.
The junior Bell, like his father, found that it only took one product to suddenly change the company’s fortunes. “It was a bit happen chance,” says Jess. “There was not a great deal of studies done or market group research completed.”
Nevertheless, Lip Smackers had an immediate impact. Says Bell, “It was our most successful product.”
Bonne Bell plays in a market space in the midst of massive expansion.
Research shows this group is growing at an exceedingly quick pace. “We figured if we get them young enough, we would have a good share of the older market,” Bell says.
The “older market,” teenagers, is a prized consumer group. According to the market research firm Geppetto Group, teenagers shop as often as 54 times a year, much more than their adult counterparts. Today’s teenagers also receive larger allowances than ever before, and a sizable portion of that money is spent on cosmetics. This year, sales of teenage beauty products are expected to reach $10 billion.
In 1998, the youth market accounted for nearly 20 percent of the $28.4 billion spent in U.S. cosmetic and toiletry sales. That has been growing at a rate of close to 8 percent a year.
It hasn’t taken very long for Bonne Bell’s competitors to understand the vast potential of the youth market and adapt. Old-line cosmetics firms have expanded their product lines to include lip gloss. A host of start-ups such as Too Faced and Jane’s Cosmetics joined the race to introduce the next cool thing. And, retailers like Wal-Mart have opened their own in-store teen beauty centers to tap into the market.
Bonne Bell may be a brand to be reckoned with, but in the fickle mind of the teenager brand loyalty is not enough to stay ahead of the pack. In 2000, new product launches in the cosmetic industry accounted for 6 percent of total sales with lip gloss remaining the fastest-growing segment.
Since 1999, sales have increased by more than 40 percent. All of this reveals that Bonne Bell’s competition has not only grown quite a lot, but there seems to be no end in sight.
On the surface, it sounds like it should be a no-brainer to jump into this market space. The only problem is that teenagers tend to be stingier with their money than adults. That’s because they don’t always know when they can expect more cash in their pockets. Teen incomes also tend to be more sporadic, with fluctuating allowances accounting for a large portion of what they view as income.
So capturing and hanging onto this consumer group is a true challenge that few companies have been able to master.
Doing it consistently is what separates Bonne Bell from the pack.
It should come as no surprise that Jess Bell Sr. is passionate about the company’s seniors program, which provides jobs for several dozen retirees over the age of 55.
Apparently, there must be something about working in a perpetually youthful industry that keeps people perpetually young.
At 76, Bell looks like a man at least a dozen years his junior and still runs marathons. He compliments his son – and successor – on the new glitter body powder using words like “neat” and “really cool.” But the senior Bell is quick to direct all questions about new product development, marketing and international expansion to the two people who are responsible for that growth – his son, “Buddy” Bell, and Buddy’s wife, Hillary.
“You reach a point where you can’t contribute as much if you’re not reading teen magazines and watching the news enough to keep abreast of the changes,” says Jess Bell on his retirement a few years ago, when he passed the company reins on to his two sons, Buddy and James.
Officially, Jess is still chairman and acts as consultant, but his main responsibility is oversight of a rather successful senior’s work program that operates out of the Lakewood headquarters. While Jess focuses there, Buddy and James, along with Hillary, have undertaken extensive market research initiatives and acted accordingly. They’ve engaged in trend analysis and product expansion. Since 1995, Bonne Bell expanded its product line to better encompass the cosmetic market instead of primarily focusing on lipgloss. They’ve also moved from department stores to big box retailers.
International expansion, says Jess, marks the next new era for the company.
But product expansion since the new management team took over has been the key driver to the company’s recent surge.
“It is a whole different brand and line of cosmetics,” says Hillary. “It’s Lip Smackers, its gloss, lip lites, lip rush.”
Buddy says everything about the expanding product is important – the flavors, colors, packaging style. “We try to create point of difference,” he says.
Presentation, the Bells maintain, is everything. So it should come as no surprise that visitors to the Bonne Bell headquarters in Lakewood, or the production facility in Westlake, find themselves leaving with a purple box filled with goodies. For the most part, journalists shy away from accepting gifts from the subjects of their articles, but there is something about a tissue-lined purple box of fruit-smelling, glitter laden girly-stuff that no red-blooded American woman can resist.
“That’s what’s cool,” says a co-worker about my Flip Gloss, a slim, trim lip gloss I received during my first interview with the Bell family. “Everyone in my daughter’s high school has one of those,” she adds with a nod. And it is cool. The actual lip gloss moves in a fluid motion as a small lever on the side is pushed up and the top flips up.
“Through the years we have developed a following,” says Jess, who smiles when he thinks about his customer base. “The economy today favors our audience.”
Each Bell used the same word separately when talking about their product – loyalty. That loyalty is evident in today’s consumers, who live and die by the color of their Lip Smackers, and by the mothers and grandmothers who have grown up with Bonne Bell’s products.
“Business continues to be steady for cosmetics,” says Stein. However, steady doesn’t mean consistent. “With teens, the market shifts radically and is a challenge to predict.”
For any line to sustain longevity, it has to maintain a certain perception.
“Brands mean a lot,” Stein says. “And brands that are positioned to appeal to a lifestyle rather than an age group will have a broader appeal.”
This is another piece of the Bell legacy.
Although the Bells focuses mainly on the teen and tween market, lately the product line has been expanded to include an older consumer.
“We try to not to look at chronological age,” explains Hillary. “It is a mind set – a young at heart spirit. We have 20- and 30-year-old women who use it. It has a universal appeal.”
And, while Bonne Bell’s target market may be relatively specific, what affects those trends is much more widespread.
“The hot thing in the last five years is glimmer and shimmer,” says Hillary. “It’s part because of technology and part because of societal trends.”
Hillary and her staff look at everything from the metallic paint in cars to what Britney Spears wears to the MTV awards.
“The trick,” she says, “is how to pull those trends down to our specific market.”
Spears may be a woman now, but Hillary points out that it wasn’t that long ago when the pop superstar was a somewhat innocent make-up wearing teenager.
“Britney Spears changed when girls wear cosmetics,” says Hillary.
Not just when, but also how much. It may be tempting not to take Spears seriously, but it is important to understand the influence music plays in the tween and teen psyches. Music spending is on the rise and ranks higher even than popular video games.
When you consider that these age groups are more affluent than ever, with the average tween receiving $10 each week and teens as much as $32 per week in personal spending money, the buying power of this group quickly adds up.
By the beginning of the 1990s, it was apparent that Bonne Bell’s products needed a shift from department store sales to the world of mass retail. Jess Bell says department stores simply weren’t promoting youth cosmetics effectively, and the company’s sales during the ’80s reflected that erosion.
“Chains like Wal-Mart and Target are very interested in the teen and preteen audience,” says Jess. “We had to go after (them), but first we had to prove ourselves to them.”
Getting space on the shelves wasn’t so much the issue as getting the fickle chains to place and promote Bonne Bell’s products as cosmetics of choice for the teen crowd.
“These chains were not in the business of promoting product,” Jess says, adding that now the big box retailers are one of the company’s most powerful sales outlets. Once again, part of Bell’s decision to change strategy arose from necessity.
Because they’re a privately held company, the Bells don’t disclose exact sales and earnings numbers. But they do say the company’s sales were more than $100 million last year. And, with the continued growth of the youth market, Buddy and his team have cast their gaze overseas.
The universal appeal of Bonne Bell’s products, and the similarity of marketing to a global audience, makes the move easier to undertake today than it would have been a decade ago.
“Culturally, kids and teens are not that different,” Buddy says. “The U.S. is such a strong influence. And now, we are more focused on consumer trends tastes and preferences.”
How to reach: Bonne Bell Inc., (216) 221-6256 or www.bonnebell.com