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Collaborations and the Golden Rule
By: Jeff Falk
Posted: February 11, 2008, from the February 2008 issue of GCI Magazine.
page 6 of 8GCI: Euromonitor International states that premium fragrances are driving growth in both Western Europe’s and North America’s fine fragrance markets. Do you agree? Can it be expected that premium fragrances continue to be the key driver of these markets?
Judith Gross: Definitely, for several different reasons. One: we see at IFF that over the last two to three years, there has been a major shift in ... many of the brands we work with, which [are] going back to true luxury. Not only in the marketing dimensions but in the true making of the products themselves, [we have seen] licensed perfumers [who] like to use two luxurious materials, both naturals [and] chemicals. By creating products over the last two or three years that have justified, in a way, their incremental additional price, they have contributed to and will continue contributing to the growth. This is something that some of the biggest global luxury fine fragrance brands, that we work with have really understood, and we are now really strongly integrating, or reintegrating, in their marketing DNA.
Celebrity brands are much less relevant in Western Europe, with maybe one or two exceptions [like] the mass-market in Germany and mid-market in England. In those countries, what you really see generating growth are brands that have really recaptured their prestige image and have strongly rebuilt on it, or are rebuilding on it. As a sign of that, when you see that most fine fragrance brands have launched over the last two to three years, [the launches include] extremely high-end ranges, which happens with a much more limited distribution than the rest of their ranges with a much higher price point—with very different kinds of fragrance creation. This really contributes to the desire that brands have to upgrade their brand image in general and [ensure consumers that incremental price increases are legitimate] .... When you give consumers trust that the additional price that they will pay is justified by the quality of the product—then it’s a win-win situation. And when you look at the top 10 market in Europe, for instance, it’s very interesting to note that the most stable brands—the products which are growing with the best stability or in the most consistent way over the last year—are the brands that are actually the most expensive ones.
GCI: In “The Forgotten Fragrance Consumer” presentation, it was stated that fine fragrances are competing in a new beauty world where everything has a significant fragrance. Do you agree? How does this change how you brand, market and sell a scent? Does this actually provide other opportunities such as more strength in fragrance brand extensions—skin care, lotions, etc.? Is there more of an advantage for fragrance brands in competition from scented products?
Marcy Fisher: Scent is everywhere! Consumers now have very educated and broad fragrance palettes. Again, the success goes back to brand identity—our consumer is open to many more fragrance notes and products, which provides a great opportunity to convey the emotion in the most acceptable manner.