SICILY’S SAVVY MARKETER
Byline: Amy B. Barone
MILAN — Profumerie Grasso of Messina, Sicily, has such a strong reputation for marketing that when Volkswagen launched the Golf convertible in Messina a few years back, it borrowed the perfumery chain’s customer list.
Insurance giant RAS also tapped into the valuable roster when it began offering a new policy aimed at women.
Not content to restrict its savvy marketing ideas to Sicily, Grasso formed a joint venture with Marbert Cosmetics of Dusseldorf, Germany, in 1997. Called Grasso Project, the new company is owned in equal shares by both partners, who aim to open modern perfumeries outside of Sicily with an eye to central and northern Italy.
Retail operations are now based on two types of stores: a luxurious, more traditional format, called Grasso Profumeria, and an updated version with an offbeat, down-home look, called Grasso Store.
In the city of Catania, the traditional format is known under a different name, Profumeria Pi¥, because there is another perfumery called Grasso.
In general, the new partners intend to open both kinds of stores, but feel that the Grasso Store formula will progress more slowly.
Always on the lookout for possible acquisitions, if the space and location are right, Grasso made a move in April. It staged a coup when it purchased three stores belonging to the five-door Crisanti Profumerie of Palermo.
Crisanti was the second largest perfumery chain in Sicily after Grasso. The Grasso network now includes four stores in Messina, one in Catania, one in Melazzo and five in Palermo.
The secret to Grasso’s success remains a dynamic marketing formula based on superior service aimed at every family member. For years, the 11-door chain has targeted young clients through special events in discotheques on a year-round basis, supported Rotary and Lions clubs events by dispersing beauty product samples at dinners and conferences and helped raise funds for UNICEF with increased efforts made during Christmas and spring campaigns.
Most important, the chain frowns upon discounts, a widespread practice which has become a fixture on the Italian retail scene that has instigated price wars in certain cities throughout the peninsula.
According to Filippo Denaro, director of Profumerie Grasso, “We’re against the idea of discounts. Prices are not a problem in perfumeries — consumers want a wide range of products and good service.”
In 1994, Grasso launched …pi¥, an in-house magazine on fashion, beauty, cultural events and local news. At first, it was mailed to clients six times a year.
Now boasting a circulation of 20,000 copies and distributed quarterly, …pi¥ was recently downsized from a 16-page to a four-page format to serve as more of a promotional tool.
It is also distributed in stores. Denaro views the magazine as well-accepted and “close to women.” In Italian, “pi¥” means more.
As a member of the 1,200-door Gold Profumeria Initiative, the chain also offers monthly perfumery magazine Cipria.
One of the retailer’s most valuable image-enhancement strategies was the introduction of the Carta…pi¥ service card back in 1992. “It’s a tool to get clients to know our stores better, and it helps increase traffic,” stated Denaro.
The card offers such perks as special prices at cinemas, discounts at beauty institutes and hair salons, and a free subscription at a health club.
Among more than 20,000 Carta…pi¥ cardholders, the number of those aged 27 and younger now total 5,000 to 6,000 customers. Grasso regularly targets them with promotions for youth-oriented treatment brands. The giveaways are often a free pass to discos.
In the future, Grasso aims to make the transition from offering a service card to a credit card and is searching for a bank with the best conditions.
As for the challenge from aggressively competing national chains and the incursion of foreign competitors like Sephora, Denaro feels the Grasso Store strategy will succeed well in other cities and he admits to no fear.
He stated: “The store is the first of its kind here, and we know how to appeal to the Latin sensibility of Italians. Now that we have an important financial partner, we plan to expand outside Sicily.”
Ideally, the chain seeks new stores of at least 2,850 square meters (28,500 square feet) in central and northern Italy.
The first joint-venture Grasso Store was opened in Palermo last November and immediately attracted a clientele, consisting largely of men and young people. The youthful customers generate close to 60 percent of the store’s sales.
Designed by an in-house architect, the 5,700-square-foot store has a rustic look with stone walls, wood floors, high ceilings accented with wooden beams and open shelving with black hardware.
Video monitors for each brand dot the cosmetics area, giving the store a futuristic aura. Rather than a conventional storefront, the interior entrance is completely open and flanked by customized stone structures for promotional displays. A department geared to young people, offering such accessibly priced brands as Collistar, Naj-Oleari, Biotherm and Marbert, is situated near a traditionally designed cosmetics area.
Earlier this year, the chain established a more user-friendly makeup area for ease of sampling. Future projects may include a refreshment bar.
For 1997, same-store sales for the whole group were $6.9 million, a figure which is expected to rise to $10.3 million this year.
By the end of the year, the chain hopes to grow to a maximum of 14 stores in Sicily, where new units are planned for the cities of Acireale and Catania. Catania is slated for a Grasso Store opening — once the right location is found.
Denaro’s strategy hinges on developing store traffic, and he credits a wide assortment of brands for drawing customers into the shop. Treatment makes up about 37 percent of sales at the chain, followed by leather goods at 30 percent, makeup at 16 percent, fragrances at 12 percent and toiletries at 5 percent.
“Almost all categories grew uniformly last year,” Denaro said. “It was surprising.”
Since 1970, the original Grasso chain has offered an extensive accessories section selling silk scarves, costume jewelry, small leather accessories, purses and luggage.
Based on average store sales, the category accounts for about 30 percent of sales volume, and new stores will continue to carry these goods.
In 1996. the chain added Shiseido, Estee Lauder and Clinique to a lineup that already included Sisley, Carita, La Prairie and Terme di Saturnia, among other brands.
Denaro noted, “[Customers] today are demanding. They read, which makes us realize that advertising is very important to this business. It’s important to sell the most important brands and top that off with service.”
Denaro noted that repurchases in the fragrance category are driven by good perfumes, adding that “extraordinary products must be supported by equally interesting advertising.” He gave, as an example, Chanel’s Allure as having had the right investments behind it. New launches driving sales at Grasso are Bulgari’s Black, Calvin Klein’s Contradiction and Gucci’s Envy for Men. Other popular Italian brands — all fragrance oriented — are Giorgio Armani, Dolce & Gabbana and Very Valentino.