BW Confidential - Issue #4 - October/December 2010 - (Page 44)

Insight: Fragrance New opportunities Pinpointing market potential There are still a lot of untapped areas of growth for fragrance. We outline some of the sector’s main opportunities by Oonagh Phillips Fixing the flankers Flankers are a constant in the industry, even though they are also constantly criticized by the trade and manufacturers. Flankers are often seen as an old, tired way of bringing more attention to a launch after the initial impact of the ad campaign has worn off; but they often end up doing more to confuse the consumer. UK-based The Perfume Shop buying director Keran Fordham says that the industry needs a new approach to the way it launches and the introduction of flankers. “Flankers are not always done in the right way; they are often not different enough and are just a version of the EdP that is £5 cheaper and so encourage the consumers to trade down from the EdP. Many suppliers do this just to push the retailer with more skus and drive wholesale. More innovation needs to happen on flankers, and brands need to add a point of difference,” she comments. Adding a point of difference was the thinking behind Givenchy’s Ange ou Démon Le Secret fragrance (pictured). The scent, which came out last year, was a new version of the original Ange ou Démon fragrance which launched in 2006. Givenchy treated the scent “as a new launch, designing it almost from scratch,” rather than just making a slight change to the original. The Le Secret version had a new juice, with a different color, and the concept was intended to represent the ‘lighter or angelic side’ of the Ange ou Démon story. The brand invested heavily in the flanker, supporting it with an ad campaign featuring American actress Uma Thurman. New price points There is much debate about the impact of the increase in prices of fragrances over the past four to five years. Some say that this is one reason that consumers have left the category. For The Perfume Shop buying director Keran Fordham there is an opportunity for manufacturers to introduce items in the £20-£30 bracket, especially in the area of gift sets and coffrets. Investing in the internet The internet is a growing channel for fragrance sales, but analysts say that the e-commerce sites of many of the major retailers leave much to be desired. They are criticized for not being properly updated, not promoting peak selling periods, such as Valentine’s day, and for starting out on projects that are never followed through. One expert says this is basically because most sites are run by technology buffs or programmers rather than content editors who know about fragrance and would be able to animate the site and introduce relevant features. He adds that most of senior management’s decision-makers are older executives who don’t really understand what can and cannot be done with the internet and are out of touch with how younger consumers use the medium. Sites are also blasted for being antiquated and for just putting up a catalog online and hoping for the sales to come. Analysts suggest that e-tailers add more services and provide a platform where shoppers can discover and interact with the scents. If there is no real point of difference, consumers will end up buying from one of the many online fragrance discount stores. 44 October-December 2010 - N°4 - BW Confidential

Table of Contents for the Digital Edition of BW Confidential - Issue #4 - October/December 2010

- Brand & retail news recap
- Digital digest
- Companies on the move
Take note
- Market facts, figures & trends
Best of BW
- Highlights from our e-publication
- The latest in fragrance, skincare & make-up
- BPI president Rémy Gomez
Insight: fragrance
- Category overview
- Retailing
- Industry viewpoint
- New opportunities
- Launch roundup
- Airport Spas
- Spa case studies
- New store concepts
Travel retail
- Market overview
- Retail strategies
- Interview: World Duty Free & Aldeasa
Show preview
- TFWA World Exhibition
- Six up-and-coming beauty brands
Market watch: India
- Country overview
- Industry roundtable
- Retailing analysis
- Sector outlook
- Sustainability
Last word
- Mintel head beauty consultant Nica Lewis

BW Confidential - Issue #4 - October/December 2010