Body Shop creates space for a voice in marketing

Filling a long-overdue position will help get the environmental cosmetics firm's message across

BY NIGEL COPE

Body Shop is planning to appoint its first board-level marketing director as part of a major shake-up intended to give the company a more coherent marketing strategy and make it less reliant on the public relations skills of founder Anita Roddick.

The appointment is seen as long overdue for a company the size of the Body Shop, whose communications are regarded by many as confused and unco- ordinated, with nobody appearing to be in overall charge. Yesterday, the company was unable to provide anyone to answer questions of the forthcoming appointment.

In the past, Body Shop has relied on a communications team, a press office and head of strategic marketing, Jilly Forster. Ms Forster will now move to a new position as head of corporate style with a new marketing director brought in from outside. Body Shop chairman Gordon Roddick is believed to be standing in as marketing director until a full-time appointment is made.

The main board appointment is seen as highly significant for Body Shop. The chain has problems in the United States, where its brand name is less well known and the market is fiercely competitive.

Presentation of Body Shop in America is seen as a key part of the new director's role. Julie Ramshaw, stores analyst at Morgan Stanley, said: "This is about more than putting together a nice advertising campaign. It will be a strategic, tactical role that looks at fundamental issues such as pricing, product and positioning."

Body Shop has gradually been moving more towards conventional approaches to getting its messages approach The company appointed Chiat Day as its advertising agency last year, after eschewing advertising in the past. It recently announced it was to double its marking spend to pounds 3.5m and plans to launch a radio station later this year on the Astra satellite. Ms Roddick said that the company needed to "shout a bit louder" about what it was doing.

Analysts also see the move into advertising as a means of controlling its messages more than it could by relying on free editorial coverage in newspapers and magazines.

Shares in Body Shop have performed poorly over the last year, slumping from 263p in May last year to 109p last month. Yesterday, the shares finished 4p up at 136p.

Shares in the company lost 13 per cent of their value last month when Body Shop announced disappointing results and a warning of little or no profits growth next year. Profits for the year to February rose 13 per cent to pounds 33.5m but the contribution from the US stores fell from pounds 6.2m to pounds 4.9m. Like-for-like sales fell by 3 per cent over the year and by 8 per cent in the three months following the year end.

Body Shop expanded rapidly in the US but some existing stores were allowed to become tatty and too few products were launched. Customer service was another problems area.

Since then, Body Shop has appointed a new director to oversee the US operations. Terry Hartin, who sold his cosmetics business to Body Shop in 1991, moved out to the group's North Carolina offices in May.

Analysts are forecasting profits of around pounds 38m for next year. Some in the City now rate the shares as a buy as any good news emerging from the company is likely to have a significant impact on the price.