BW Confidential - Issue #2 - May/June 2010 - (Page 44)

Fragrance creation Industry analysis Back to basics? Putting creativity back into perfume making by Oonagh Phillips B rowse through some of the fragrance blogs and you’ll keep coming across the same type of comments, questions and criticisms. “Why does my favorite fragrance not smell like it used to?” “Such and such fragrance now smells cheap and doesn’t last,” or “I wouldn’t pay for fragrance x—it smells just like fragrance y, but not as good.” What does all this say about the fragrance creation process? Probably that the consumer is no fool and can tell quality from cheaper alternatives, and maybe that brands need to take a new direction in how they work with their suppliers. It is also perhaps telling of the effect that regulations have had on the consumer’s perception of some of the older fragrances, which have been reformulated to meet today’s regulatory standards (see article p. 46). One senior executive from a major fragrance oil house is not surprised at these comments, and says that the industry needs to go back to the basics of creating real fragrance. “Instead of spending premiums to be on core lists, and instead of brands putting all the money in advertising and packaging, the industry needs to invest in the actual fragrance. The consumer today knows if a product has been made cheaply and isn’t up to scratch.” Getting what you pay for Fragrance suppliers have criticized brands in the past for coming up with a budget for the juice that is more in line with a massmarket than a premium luxury product. However, there are signs that the crisis has made brands re-think how much money they should devote to the fragrance and has made them more interested in upgrading their products. “Some brands are beginning to understand that the value of the juice will result in a repeat purchase, and so they are going “ With the fragrance cost of goods representing less than 2% of the retail price, there is room for re-invention Mane president Michel Mane back to that. But at the same time, some still see the juice as simply a cost,” says IFF vice president fine fragrance and beauty care worldwide Christophe de Villeplée. He cites the success of certain niche brands, which put a premium on the fragrance ingredients, as proof that the consumer recognizes and is ready to pay for quality. For Mane president Michel Mane more ” could be done here. “With the fragrance cost of goods representing less than 2% of the retail price, there is room for re-invention. The ‘differentiation + quality = value’ equation must be right for the consumer to pay three times more for a 4 oz bottle of alcohol with fragrance than a nice scent in a lotion bottle.” But it is not only about the money. Firmenich managing director fine fragrance Western Europe Yvan Bagnis comments: “You may have the best quality ingredients in the world, but you also need to have a good palette. Most of our competitors only have around 1,000 ingredients to work with while we have we have 2,200.” In terms of quality, there was a lot of discussion last year of producing less and focusing on classics. However, there is little indication of brands slowing down their launch schedules. The industry has long talked about the excessive number of new products on the market and the confusion it creates for the customer. But for IFF’s de Villeplée, the problem is not so much the number of launches as the “relevance” of these launches. He refers to the number of flankers and limited editions. These products can also be a source of much frustration for the consumer, when the fragrance she likes 44 May-June 2010 - N°2 - BW Confidential credit: stock.xchng

Table of Contents for the Digital Edition of BW Confidential - Issue #2 - May/June 2010

- Brand and retail news recap
Take note
- Market facts, figures and trends
The latest fragrance, skincare and make-up launches
Best of BW
- Market highlights
- Clarins Fragrance Group president Joël Palix
Insight : skincare
- Category overview
- Industry viewpoint
- Trends
- Training in spas
- Spa case studies
Market watch : Asia
- Regional analysis
- Japan
- China
- South Korea
Focus : Fragrance creation
- Fragrance regulations
- Perfumer roundtable
- Six up-and-coming beauty brands
Travel retail
- Asia regional roundup
- Interview with Korea duty-free
Last word
- Morning Star equity analyst Erin Swanson on beauty’s threats and opportunities

BW Confidential - Issue #2 - May/June 2010