NEW YORK — One of the last of beauty’s independents has been bought.
This story first appeared in the July 5, 2002 issue of WWD. Subscribe Today.
Demeter, an indie fragrance house known for marketing wacky scents such as Snow, Sugar Cane, Dirt, Mildew and Condensed Milk, has been acquired by Freedom Marketing Group for an undisclosed sum.
Freedom Marketing Group, or FMG, was formed in May by Mark Crames, former chief executive officer of the Northern Group, and his wife, Debra Janke, former vice president of sales administration of the Northern Group. Crames is now ceo of FMG and Janke is president of sales administration of the Northern Group. Crames is now ceo of FMG and Janke is president. “What we want to do is create opportunities for fragrances that otherwise could not have U.S. distribution,” said Crames. “And we want to create distribution possibilities for niche brands. We’ll do everything from design and marketing to distribution to selling and collecting money.”
And Demeter, which has been a darling of the Fragrance Foundation on FiFi award nights, was a prime opportunity. Demeter won two FiFi’s in 2000 for its Snow scent and two in 2001 for Sugar Cane.
“I’m always sorry when an entrepreneur can’t make it on their own,” said Annette Green, the retiring president of the Fragrance Foundation. “On the other hand, it is being bought by another entrepreneur and that gives it a chance to survive in its original quirky form. I think it’s a positive.”
“It’s a great quirky line, it’s done very well within its own niche,” she continued. “The more offbeat fragrances enter the industry, the better it will be.”
Christopher Brosius, cofounder and master perfumer of Demeter, commented about the acquisition: “Personally, I am thrilled to pieces. It’s a huge step in the right direction.”
“I’ve known Chris [Brosius]for about a year,” noted Crames. “When I ran into him at the FiFi’s, we started talking and it became apparent that they were in need of a partner — it was a struggle for them to run the business.”
Brosius admits the timing was right. “The last six months have been difficult in general — we have not been able to concentrate on creating new things,” he said. “There weren’t enough hours in the day. [Crames] understands our philosophy. He can really just come in and make everything a great deal better.”
FMG’s deal with Demeter is the latest in a series of indie brand buyouts in the industry. In June, German hair care company Wella AG and its beauty subsidiary Cosmopolitan Cosmetics signed a joint venture with the Tony & Tina Vibrational Remedies cosmetics company. This follows the indie brand buying trend headed up in the Nineties by Estée Lauder, which snapped up MAC, Jane, Bobbi Brown Essentials and Stila, and LVMH Moët Hennessy Louis Vuitton, which acquired Blissworld, BeneFit, Hard Candy and Urban Decay for LVMH. L’Oréal snapped up Kiehl’s and Shu Uemura. Not to be left out, Shiseido bought François Nars and Zihr.
According to Crames, who will also be ceo of Demeter, the creators of Demeter — Brosius and Christopher Gable — will continue to operate in their respective roles as master perfumer and head of marketing. Under the venture, Brosius will be vice president, creative director and Gable will be vice president of marketing. “My role will go back to what it was and should be —perfumer and creative director,” said Brosius. “I’ll be running the store, doing more personal appearances and expanding the [fragrance] library.”
Gable, he continued, will head marketing. “He can now spend his time focusing on how to say the message, not having to worry about sales meetings,” said Brosius.
FMG, based in Great Neck, N.Y., has acquired 80 percent of Demeter. Brosius and Gable are each left with a 10 percent stake. Under the acquisition, the company will now be known as Demeter F.L. Inc. “We created a new entity in order to place the assets,” said Crames.
Demeter will operate out of three locations now — the FMG offices in Great Neck, the Demeter store on Second Avenue in New York’s East Village and a small factory and warehouse in Pennsylvania.
Under FMG, Crames expects the business to increase at least three to five times what it is today within the next 18 months. According to Brosius, Demeter did $1 million at wholesale last year and is expected to do $1.5 million this year.
Crames has far grander plans for the brand. “At retail worldwide, we are looking at a brand that should be doing between $50 million to $60 million,” said Crames. “The world is the oyster for this brand.” Current distribution consists of about 440 doors in the U.S., including Sephora and Ulta. The brand is currently being reintroduced in the U.K. A western European rollout is planned for 2003.
“It’s a very exciting proposition,” Crames continued, adding that Sephora is currently Demeter’s biggest door. “It appeals to that much desired 15- to 30-year-old consumer. It will be our job to get that brand to where that consumer shops.”
Demeter’s parent company also plans to expand the brand into home fragrance in 2003 with candles, potpourris and room sprays.
As for additional Demeter stores, Crames does see it happening, but “I want to get our distribution through other retailers expanded first.”
According to Crames, FMG has anything but a big-company mentality. “We are an independent house,” said Crames. “I’d like FMG to be a collection of independent brands, to create a context for more companies like Demeter.”
FMG is rumored to be eyeing other brands such as the fragrance licensee of MCM, a German leather goods company that was high profile 10 years ago and currently only has European distribution, as well as Tom Taylor and Mondi — both German fashion brands. “