Fragrance Industry
Business Environment of Fragrance Industry
Fragrance industry is suffering from the ruinous competition of foreign rivals who apparently are flooding the domestic market at an incredibly low price. The French industry, which once was considered at the pinnacle of the fragrance market, is loosing market from Asian competitors. Moreover, there has been a slow growth in revenue of large fragrance companies due to the mass marketing of fragrance sales from small competitors. The sluggish growth rates in the home fragrance market are due to a combination of factors. First, the fragrance industry is facing several major industry shifts that are causing changes on the bottom line. Faced with the challenges of low revenue and intense competition, innovative companies are looking to enterprise sourcing to both speed up time-to-market on new products and drive down ongoing supply costs (Chemical and engineering news, 2003).
Consumers today are making value-based decisions in purchasing perfumes so in the face of brand loyalty erosion, perfume industry are looking for ways to reduce product prices to compete with private label manufacturers without sacrificing the quality of the brand.
Since fragrance items are mostly seasonal items, a greater volume of inventory and supply-chain activity is required than is for other consumer-packaged goods for a preferable amount of time in the year. Toward this end, companies are looking ways to drive best-in-class product introduction cycles while carefully considering designed-in costs for raw materials, packaging and marketing materials.
Barriers to entry
There are variety of entry threats coming from chemical firms, candle firms, and cosmetic firms. For example, total home fragrance sales grew by only 4% in 2001 to $2.3 billion, up from $2.1 billion at the manufacturers' level. However, much of sales gains were largely due to the 21% growth of diffuser products. Meanwhile, candle sales continue to suffer, especially in mass-market outlets, as marketers shift their attention and promotional spending from candles to their oil diffuser products. Also too many new stores are openings in malls selling the alternative means of fragrance. Overall, lack of consumer traffic in malls is also contributing to weak sales.
Suppliers and Consumers
There have been threats from suppliers, because instead of high brand names, many new suppliers have entered the markets. The suppliers are making it possible to ship low end of fragrance products, as the consumers are looking for cheap products. Therefore, mass-market is flooded with the impact of private-label entries and foreign imports that have disrupted their longstanding retail partners. Private-label sales were up by nearly 20% in 2001, a source of great concern among branded marketers. Sales also continue to shrink at the specialty store segment, an important component in the home fragrance market, and a source of much growth over the past few years (Guner, 2002).
Sourcing fragrance items often involves complex materials, such as high-end plastics and glassware, and attention-grabbing labels and colors, to provide a luxurious look and greater shelf appeal. Therefore, sourcing professionals are under pressure to be cost effective but maintain the same standard of brand quality while competing with the low-end fragrance products.
New Trend in Fragrance Industry from Past four-five Decades
The trend from four to five-decade ago is the resurgence of potpourri through many marketers that have shied away from the category for several years. Potpourri has been on the decline for many years; however, with the rise in low end products, potpourri will surely stimulate interest.
Another notable performance trend unlike the past is that the fragrance industry is creating large distribution networks for selling fragrance forging new retail partnerships with large chain stores such as Linens 'N Things and Bed, Bath & Beyond. Some other companies are looking to improve upon their dull sales, employing several different initiatives like exploring new channels and entering new complementary categories to jump-start their sales.
Another difference from the past is the scope of the global competition in the fragrance industry. In today's increasingly global competition, enterprise...
I think that proper networking and research on who is making quality products, and finding a vendor with a good track record of customer satisfaction would be crucial in getting a positive consumer reaction. Networking Networking is invaluable when you do not miss opportunities that are available just from people talking about your product. Some of the smaller stores are involved in fairs and events where products can be introduced to
Marketing Management The cosmetics industry and market continually change to present players in the field with new opportunities and threats. In the context of the dynamic and competitive industry, Estee Lauder is seeking to introduce a new product line to better serve the changing needs of customers. The new product line would be sold with the Beautiful fragrance and would be distinguished by the fact that it is based on components
Marketing Challenge The primary marketing challenge at Flare Fragrances is to develop an appropriate and competitive marketing strategy for the new Savvy brand to be launched in 2009. The specific issues in this challenge include the question of whether to launch Savvy in the first place, whether to distribute it through conventional or through new channels, and whether to associate it with the Loveliest umbrella brand or to give it a
creative Chanel Coco mademoiselle perfume, templates/outlines; Target Audience; Brand Position; Brand Imperatives; Communication Objectives (FACETS model); Consumer Insight; Proposition Selling Idea; Support). Coco Chanel: Mademoiselle perfume Coco Chanel's Mademoiselle perfume is targeted at a youthful, fashion-conscious consumer whose style is still evolving. The first demographic of interest is that of 20-24-year-old women, who have just start working. Mademoiselle may be their first 'grown-up' perfume purchase. More mature women in the age
sexual imagery and sexual concepts in advertising has existed for nearly a century. In the past several decades, however, this form of advertising has begun to target younger groups of consumers as a wider array of products are presented as aids to sexuality and sexual fulfillment. Whereas certain products, such as alcohol and undergarments, have traditionally been marketed using erotic ideas, today's sex-based marketing strategies include items such as
Further, Valerie doesn't have any experience in the beauty industry other than Wisson, so the loss of a reference for this experience would be devastating. A loss of a job at Wisson would also mean that she would lose her tuition reimbursement for a master's of science program she has just been accepted to at the prestigious University of Chicago. Without this assistance, she might be unable to pay
Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.
Get Started Now