Hair-Care Firm Finds a Style of Marketing That's Very Becoming

By LEE ROMNEY

May 3, 2000 12 AM PT

TIMES STAFF WRITER

It was a simple act that sent Al Anorga’s revenue soaring.

His company was inching toward success on the strength of its hair-care products when Anorga turned to a market he knew as intimately as the color of his skin.

He went straight to the Latino beauty salons and barbershops he grew up around, offering free Spanish-language training on how to best use his color seal products for women and men’s pomade, popular with clipper cuts and the trendy Ricky Martin style.

The results stunned even him: Last year, revenue for Anorga’s Whittier-based Atlas Wholesale topped $700,000, more than doubling from 1998. His products are now sold across the U.S. and in Mexico and Puerto Rico.

“It was phenomenal. I kept thinking the sales would level off the next month or the next month,” said Anorga, 33, who spent his teen years working in his mother’s Pico Rivera beauty supply store. “The niche is the education to the Latino salon owner. . . . My advantage is in my ethnicity.”

What Anorga discovered is a bursting and under-tapped Latino market for hair-care and other beauty products. Until recently, the market had been all but ignored by most big manufacturers. But statistics show they should take heed: Latinos color their hair at twice the rate of all consumers. They are also much heavier users of conditioners, creams and gels, along with cosmetics, nail polish and perfume.

The U.S. ethnic hair-care and beauty market reached $1.6 billion in 1999--with $1.2 billion of that going to hair care, according to market researcher Packaged Facts Inc. Yet the bulk of ethnic products are targeted to African American consumers. Latinos, a multiracial mix of hair types and skin colors, have been largely overlooked.

While hair and skin type may be varied, attitude and style dictate some big spending. Virtually all Latinos feel the need to be well-groomed, versus 8 in 10 Americans overall, research shows.

“Hispanic women are higher users of beauty products than non-Hispanic women,” said Rochelle Newman-Carrasco, president and co-founder of Enlace Communications, a Los Angeles ad agency that helps clients reach the Latino market. “The sheer numbers of Hispanic women in the U.S. are growing, and as the middle-class and upper-middle-class constituency grows and Latinas have more disposable income, there’s nothing stopping them.”

In the last year alone, big hair-care and cosmetic manufacturers have increased their advertising and product promotion to Latinos. Still, the hands-on education and outreach that really wins Latino consumers is still rare, Newman-Carrasco said.

And if Latinas have been ignored by marketers, their male counterparts have fared even worse, leaving more room for insiders such as Anorga. He has built loyalty for his men’s and women’s products through bilingual training that covers everything from coloring to how to fade a clipper cut and bleach the tips of men’s hair.

Entering Industry Is a Return to His Roots

His embracing the market came naturally. As a teenager in Whittier, he took two buses daily to work behind the counter of his mother’s beauty supply shop.

Even before graduating from high school, he enrolled in vocational beauty school, keeping it secret from macho schoolmates. He eventually earned a bachelor’s degree from Cal State Long Beach and a cosmetology degree from a now-defunct beauty college.

His first glimpse at the buying power of beauty-conscious middle-class Latinos came in 1991 after he graduated. Anorga took over a beauty salon that his mom had purchased in the Montebello Town Center, converting it from a Fantastic Sam’s to a higher-end salon with a hip decor. Business soared.

They sold it two years later, and in 1994, Anorga purchased his first solo venture, Atlas Beauty Supply, for $1,800 from a debt-stricken seller in Pico Rivera. Bored with retail sales, he also made his first foray into wholesaling, distributing the Italian hair color Elgon.

His mother’s store and his own were his only initial customers, but he slowly built a base, hawking the product out of his car to shops and salons. Still, he was eager to develop a product of his own. So was born Color Seal, a pillow pack of banana-scented conditioner that retails for less than a dollar and helps repair dyed hair while sealing in color and removing the smell.

The idea came from his days at his mother’s shop, where they would fill plastic salsa cups with single-use portions of boutique conditioner for women to use after coloring. The product is designed for daily use and also is sold in larger containers, along with Color Seal shampoo, conditioner, styling foam, styling polish and spray-on shine.

Southland Market Big for Latino Focus

Sales climbed steadily, from $50,000 in 1995 to $180,000 in 1997. Then Anorga zeroed in on the men’s market.

“I started seeing all these barbershops, and I thought, ‘All my friends get clipper cuts and fades and flat tops,’ ” Anorga said. The pomade most were using, he said, smelled terrible and was so sticky it ruined the motors on hair clippers. Furthermore, it gave the high school kids whom Anorga coached acne when it ran onto their faces.

His answer: Johnny B. Crew, a wax-free non-sticky pomade with a wholesome 1950s appeal. Other varieties followed, including water-soluble Aqua Pomade, popular for Ricky Martin-style cuts that flip up in front.

By 1998, wholesale revenue jumped to $320,000. Atlas Wholesale became a separate entity and moved into warehouse space in Whittier. Anorga’s wife and business partner, Yvette, still runs Atlas Beauty Supply down the street.

In 1998, Anorga also began marketing nearly exclusively to Latino salons, barbershops and beauty colleges with a high concentration of Spanish-speaking students. While he contracts with outside sales representatives to distribute to supply stores nationwide and abroad, more than 80% of his business comes from Southland salons in Latino neighborhoods.

Anorga didn’t have to mull over market research to choose his strategy. The numbers, however, help explain his good fortunes: Fully 37% of Latinos use hair-coloring products, more than twice as many as in the overall population, according to 1999 data from Simmons Market Research.

And 62% of Latinos use hairstyling creams, gels or lotions, compared with a little over a third of the overall population. Nearly three-fourths use hair conditioner and cream rinse, compared with less than half of overall consumers, the data show. The higher use also plays out for mascara, eyebrow pencil, nail polish, blush and foundation makeup.

Other Latino-owned companies are homing in on the market: Ella Cosmetics of Pembroke Pines, Fla., for example, recently launched on the Internet its line of beauty products catering to Latina skin tones. But big corporate players are also taking heed.

Procter & Gamble, which has courted the Latino market for years with a range of products, earlier this year unveiled hair-care line Physique with a major Latino market push in six leading markets, including Los Angeles.

The campaign took Physique stylists into nightclubs for male and female “best hair” contests, and to Latino-owned beauty salons where they styled the hair of top Spanish-language television and radio personalities.

Although Latino market campaigns are often low-budget affairs that come long after an initial product launch, Physique began vying for Latino consumers almost immediately, said Ana Agrelot, Physique brand manager for multicultural markets. Already, Latino sales in Miami have surpassed general market sales, with strong showings elsewhere in the country.

“Hispanics are definitely very, very hair-involved,” Agrelot said. “About 70% claim they style their hair on a regular basis, and of that group 77% say they style it more than four times a week.”

On the cosmetic front, P&G;’s Cover Girl recently hired a separate Latina “spokesmodel” and launched a beauty contest with People en Espanol magazine. And Maybelline (owned by L’Oreal) and others have also upped Latino-market ad spending: Cosmetic and fragrance advertisers now comprise nearly 40% of business for the booming Latina magazine.

Still, the hands-on efforts are nascent, and Anorga has found himself with plenty to do.

“I can’t compete with the big guys, but I can compete in [the Latino market] by providing education,” he said. “The Southern California market is so big it’s hard for us to cover it.”

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Looking Good

Latino consumers are heavy users of hair-care and cosmetic products, outspending the average U.S. consumer. A look at Latinos’ product usage versus that of the overall population:

Hair color

Latinos: 36.8%

U.S. overall: 17.5

Styling cream, gels

Latinos: 62.2

U.S. overall: 36.0

Hair spray

Latinos: 56.2

U.S. overall: 42.5

Hair conditioner

Latinos: 72.3

U.S. overall: 47.6