“The TODAY Show featured a kit for sprinkles on nails,” John Mandelker, President of Cutex Brands, shared with me during our call. “While the nails are wet, you can add the sprinkles on top. The idea of having texture on your nails is so interesting.”
I bet a younger Mandelker wouldn’t recognize himself.
When Mandelker took the helm of Cutex, the iconic 100-year-old nail care brand, in 2011, he was a traditional private equity guy whose aesthetic interests were more about ties and cufflinks than nail bedazzling.
“I knew nothing about nail care when I started,” Mandelker said. “Private equity is never about being an expert, and recognizing that, I don’t act like an expert.”
I could relate to him as a finance-insider-turned-beauty-aficionado. Yet after less than two years on the job, it seemed to me that Mandelker is more expert than he might believe. He is able to prattle off all the nail greats: OPI, Revlon… and talk all about nail industry strategy. As brands like Chanel, Deborah Lippmann, or Essie dream up ways to allow women to ever express creativity on the tips of our hands, someone must watch out for what happens between polish and perfection. That’s where Cutex comes in, Mandelker says.
“Our position is between old polish and new polish,” he explains. “When old polish comes off, all the way up to base coats before polish is applied, that’s Cutex.”
It wasn’t always the case that Cutex had a clear mandate. Mandelker paints a fascinating corporate history of Cutex that started in 1911, with a brand named as a portmanteau of the words “cuticle” and “extract.” The company’s first milestone after founding was the debut of its first polish in 1917. Then, in the 1920’s, Cutex developed and sold its first nail polish remover. It remained at the top of its category “all through the 1970’s,” Mandelker says. Then, trouble hit. Cutex Brands fumbled through myriad corporate hands for years. It was sold to Unilever, then to a private equity firm that went bankrupt. The assets went to another PE-backed company, and “Cutex lost all its market share along the way,” says Mandelker.
Mandelker and his colleagues at Arch Equity Partners in St. Louis, Missouri saw an opportunity to rescue the brand. “We had a chance to buy a well-known consumer brand and revitalize it,” Mandelker says. “The challenges were straightforward: fulfill unmet needs, and gain distribution.”
While Cutex has immense history, Mandelker is bringing it into its second century in style. Since taking over the brand two years ago, a scientific approach is at the forefront of his efforts.
“If a new product doesn’t reach 85% intent-to-buy, we won’t release it. We require every product to top 85% intent-to-buy when other brands will go to market with 50%. We’re setting a higher bar,” Mandelker explains.
The bar stems from Mandelker’s background, I realize. “I would describe myself as a product guy first and foremost. My belief is that good products will be successful because good products get reordered,” he shares. “I challenge the R&D teams to not release ‘me too’ products. Instead, let’s use new technology to develop something useful to the consumer.”
Mandelker’s philosophy for Cutex is exemplified in the brand’s two latest products: Cutex Advanced Revival Nail Polish Remover and Cutex Baseworx.
The Advanced Revival remover, which launched in March, effectively removes polish while nourishing the nails. There’s need for nourishment Mandelker says.
“The standard formulation for polish remover was established in 1994. No one has made changes in 20 years, although nail polish enthusiasts are changing out polish more and more often. They need something that nourishes better than Vitamin E or glycerine,” Mandelker says.
Cutex’s Advanced Revival takes advantage of botanical oils instead. The way the idea came about is awesome. One of Cutex’s chemists was at an exhibit for 12th century religious art from Eastern Europe and Russia at the Metropolitan Museum when he noticed that the colors of the artworks were able to stay bright for centuries, despite lack of petroleum byproducts in the old days. Cutex’s chemists began researching and found that the trick to the centuries-long vibrancy was oil from plants. They began to investigate a trio of botanical oils that could be used in Cutex’s polish remover products such that when polish is being removed, the acetone in the remover eventually fades but the oils stay behind to nourish and restore the nails.
It turned out that women testing the new formulation felt the difference. They described it as “less chemically,” and 86% of those surveyed by Cutex said that the Advanced Revival did a better job conditioning and strengthening the nail too.
Where Cutex’s Advanced Revival draws inspiration from an older generation, Baseworx comes from newer sources of insight. For Baseworx, Mandelker shared that one of Cutex’s chemists chanced upon an article about an orthopedic surgeon using bioceramics in medical devices like replacement knees and hips. The article detailed that a bioceramic blast promoted adhesion, which facilitated faster recovery for patients. The chemist wondered what a “bioceramic blast” would be like on a nail.
“Bioceramics have a few helpful properties,” continues Mandelker. “It fills in space on a microscopic level creating a smoother effect, and it has adhesion qualities that get the nail polish on top to adhere better [to the base coat].”
It fares exceptionally well for women who may not have lasted a day through a manicure. Mandelker tells me the story of a female bartender now using Baseworx; every day her nails experience being submerged in water, hitting store room keys, and clanking against a cash register. Formerly, a manicure lasted one shift at best; now it’s lasting four. “The market for female bartenders is small,” says Mandelker, “but the story sticks.”
There’s something progressive about Mandelker’s vision for Cutex making exceptional products that are in tune with the modern female. “Women are active,” says Mandelker. “Work is tough on nails whether it’s at a computer or a cash register. We’re excited about filling an unmet need and using a scientific method that customers recognize.”
What about guys? While nail art isn’t expected to take off among the XYs anytime soon, Mandelker does see opportunities in men’s nail care when it comes to straightener—smoothers that give a natural, but shinier, look.
“A harbinger of attractiveness is health,” he says. “And good-looking nails and teeth indicate health. There’s a segment of the male population that are looking for an unbuffed, healthy nail look.”
Mandelker is thinking constantly about new consumer segments and product innovations. His call for creativity is not unlike the industry at large, which is increasingly seeing nails as art.
“The degree to which women will express their artistic nature on nails is immense,” Mandelker says, as he tells me about some of his favorite nail art like patriotic nails, Halloween candy corn nails, and reindeer for Christmas on nails. If nails have become the canvas, then Cutex is a critical tool, but how does Cutex stay relevant in its next century? In addition to applying technology within products, Mandelker is a fan of technology to promote products too. Mandelker’s embrace of new digital technologies is part of the plan.
“We segment our consumers into enthusiasts and casual users,” he says. “Enthusiasts have spend six times more. They may change nail polish twice or more per week. They know that acetone has an effect because it’s a drying agent. Demographically, enthusiasts and casuals are indistinguishable, but online, we can tell who is who because the enthusiasts are reading nail blogs, going to health and beauty websites, and getting involved in the nail digital landscape.”
The ability to target specific consumer segments for beauty products—purchases that are highly personal and often quite private—is the aim of my company, Poshly. Launching in June 2012, we look to bring people together with beauty products that are best for them.
It’s thrilling to see an iconic brand being restored to its former glory, yet Mandelker doesn’t see himself running the business forever. He’s looking for a CEO to replace him in his role long-term, and it’s on to the next challenge. I know he’ll be just as handy at the next gig as he is at Cutex.
Doreen Bloch is the founder and CEO of Poshly.com, a technology startup for the beauty industry. She is also the Author of The Coolest Startups in America and a member of the Young Entrepreneur Council.
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