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Wednesday, April 12, 2006

Trend: Big Companies Buy Smaller Values Brands REDUX

Following up a previous post about the trend of the majors buying up the smaller "social responsibility" brands


Ethical beauty retailer The Body Shop's enthusiastic oui to the €940 million ($1.14bn; £652m) takeover bid by French cosmetics giant L'Oréal has dented its caring credentials.

UK market researcher YouGov's BrandIndex shows Body Shop's 'buzz' rating and 'satisfaction' scores among consumers have dropped significantly since the sale was announced [WAMN: 27-Feb-06].

Animal rights campaigners called for a boycott of Body Shop's products because L'Oréal has not abandoned animal testing, while other consumer lobbyists objected to Nestlé's 26.4% stake in the maker of brands such as Garnier and Lancôme.

Body Shop's celebrated founder, Dame Anita Roddick, defended her personal £130m 'sell-out' by claiming L'Oréal wanted to be taught about community trade.

She opened the first store in Britain thirty years ago, and the company made its name and reputation by rejecting animal testing and selling natural products in recycled packaging.

It now has more than 2,000 stores in 53 countries but faced financial setbacks in the 1990s and recently lowered its profit forecast following disappointing UK and US sales during the 2005 fall/winter holiday period.

via WARC

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