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Drom Carves Fragrance Niche

As multibillion-dollar fragrance suppliers slug it out for the top of the heap, some on the supply side are content to remain spectators to the fray.

NEW YORK — As multibillion-dollar fragrance suppliers slug it out for the top of the heap, some on the supply side are content to remain spectators to the fray.

It’s about placing importance not on sales volume, but on focal points like creativity and innovation.

For James G. Dellas, president of Drom Fragrances USA, the idea is to avoid sameness in the fragrance business, fight repetition among essential oil blends and evaluate what scent is fit for a particular market.

“This is about reacting and reacting quickly,” he said about the current atmosphere in a flooded fragrance market that’s driven by celebrity scents. “You need to be able to turn on a dime and you need to be agile.”

During an interview at Drom’s TriBeCa offices here, Dellas discussed several of the biggest issues facing suppliers today, topics like ingredient regulations, core lists and the natural movement.

Perhaps Dellas’ most pressing challenge is turning into a positive the regulatory environment that overshadows fragrance suppliers. He said he felt that ingredients would be banned from the palette of perfumers, whom he compared to painters, but added, “You have to make [such restrictions] an advantage.” The European Union’s Registration, Evaluation and Authorisation of Chemicals legislation, known as Reach, “will eliminate some raw materials,” said Dellas. But, he added, if a perfumer had a palette of 5,000 ingredients and 200 were taken away, there would still be 4,800 to work with.

“I can’t say [to a fragrance marketer], ‘I can’t do that’ because the ingredients aren’t there,” he said. “If you take green away from a painter, [he] can mix blue and yellow.”

Privately held Drom does not break out figures, but market estimates place annual sales volume of the Munich firm at roughly $100 million. In November 2004, the company opened a facility in TriBeCa to meet with clients in an open, airy environment. Formulas are displayed to fragrance marketers on flat screens atop a white, wave-shape bar. The marketing and evaluation departments, as well as the oil-mixing labs, are all visible to heighten communication.

Dellas noted Drom had addressed the natural and organic consumer movements with the firm’s Pureganic extraction method. It consists of extractions that are gently performed when flowers and herbs reach their harvesting peak at Bavarian farms commissioned by Drom.

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When it comes to core lists, which manufacturers use to restrict the number of their suppliers, “if you’re on all of them, it’s not an issue, but if you’re not on any, it’s an issue.” Addressing core lists head on, Dellas acknowledged, “You have to decide what your size is going to be. You can’t be on everyone’s core list because you’ll implode from the inside.”

Dellas, 65, who has a degree in pharmacy and has been with Drom for close to a decade, began his career 43 years ago in research and development at Avon. He considers Drom’s most directional launch this year to be Driven, the scent Avon developed with baseball star Derek Jeter. Also, Drom composes Escada’s seasonal scents. The impact of such businesses was “huge,” said Dellas, who noted, “Afficionados of Escada wait for these [scents]. They [Escada] have created their own niche, in a way.”

He called Driven the biggest men’s fragrance launch ever for Avon.
— Matthew W. Evans

Coty Sets Up New Unit

PARIS — Coty Inc. announced Monday it has created a new global business unit, called Coty Beauty, which combines the company’s mass market businesses of the Americas, Europe and Asia.

Hans Joachim Honigfort, formerly president of Coty Beauty Europe, is leading the new division.

“Merging Coty Beauty into a unified division further positions Coty to achieve our goal of becoming a top-five global beauty company,” said Bernd Beetz, chief executive officer of Coty Inc., in a statement. “The strategic alignment will challenge the flourishing portfolio to embrace existing brands, while simultaneously developing innovative lines that will fuel new levels of achievement for Coty Beauty.”

Coty Beauty’s stable of fragrances includes Adidas, Aspen, Astor, Baby Phat, Celine Dion, Chupa Chups, David and Victoria Beckham, Desperate Housewives, Esprit, Exclamation, Isabella Rossellini, Jovan, Kylie Minogue, Mary-Kateandashley, Miss Sixty, Miss Sporty, Nautica, Phat Farm, Pierre Cardin (in Europe), Rimmel, Shania Twain, Stetson and Vanilla Fields.

Last year, Coty Inc. created the Coty Prestige division to manage luxury brands.
— Jennifer Weil