ERA OF THE FRAGRANCE SEQUEL: FIRMS TURN TO MASTER BRANDING
Byline: Jenny B. Fine
NEW YORK — Hit movies in Hollywood almost invariably spawn a sequel.
And now the same holds true with fragrances, as an increasing number of vendors introduce follow-up variations to blockbuster scents.
The concept, called master branding, was widely employed during the Eighties. But during the megalaunch mentality of the early Nineties, master branding fell by the wayside.
Now, escalated expenses and stagnant sales have resulted in a resurgence of the practice, as vendors try to capitalize on the millions of dollars they’ve spent establishing a brand name.
Jumping on the his-and-hers bandwagon this year are Estee Lauder with Pleasures for Men, Giorgio Beverly Hills with Hugo Woman, Cosmair with Acqua di Gio Pour Homme, Christian Dior with Dune Pour Homme and Liz Claiborne with Liz Sport for women and Claiborne Sport for men.
Those new entries will join a slew of master brands introduced last year, including Tommy Hilfiger’s Tommy Girl, Calvin Klein’s CK Be, Ralph Lauren’s Polo Sport Woman, Sanofi’s Opium for Men and Claiborne’s Curve scents for men and women.
“In the Eighties, we were really jumping from launch to launch, and they were all becoming megalaunches,” said Robert Cankes, president and chief executive officer of Christian Dior Perfumes. “Now, when you look at the cost of developing a name, it makes good business sense that when you have a winner on one side, you try to make it work on the other.
“It is so expensive today to launch fragrances and build consumer recognition with a brand name, it makes sense to use the recognition that is built already,” he continued. “If you have a name that is universal, it makes it a lot easier. You already have an awareness base there that you can talk to.
Dior’s Dune Pour Homme will bow in the U.S. this August, the male counterpart to its female fragrance, Dune. The women’s scent, launched in 1993, is Dior’s best-selling women’s scent in the U.S., a prerequisite when considering a spin-off, Cankes noted.
“You have to have a brand that has shown longevity for a while,” he said, “and has a strong sales base in department stores that has remained consistent.”
Robin Burns, president and chief executive officer of Estee Lauder USA and Canada and a master branding pioneer, agreed.
“The initial fragrance has to reach critical-mass success, which is usually the equivalent of top-five ranking,” she said. “If you don’t have that, the second fragrance in the master brand doesn’t have a chance.”
This fall, to capitalize on the runaway success of its 1995 women’s entry, Pleasures, the Lauder division will introduce a men’s version. It is the company’s first attempt at master branding and its first entry into the men’s market in a decade.
“Pleasures is the first opportunity I’ve had where all of the elements are correct,” Burns said. “You need a positioning and a name that are applicable across both genders.”
Vendors note that one of the differences between the master-branding strategy of the Nineties compared with its Eighties counterpart is the fact that rather than just sharing a name, master-branded scents now also carry a similar positioning and marketing approach.
“In the Eighties, master branding was a brand that basically shared the name, but not the elements of the strategy at the level they do now,” said Linda LoRe, president and chief executive officer of Giorgio Beverly Hills. “Today, we recognize that we need a concept that fits both male and female sensibilities, rather than just tack on a second entry.”
Giorgio’s take on the phenomenon will be the August introduction of Hugo Woman, a spin-off of its popular Hugo by Hugo Boss fragrance. That scent is reportedly expected to achieve a first-year wholesale volume of over $30 million, due in part to the brand recognition already garnered by its predecessor.
Liz Claiborne Cosmetics is taking a more unorthodox approach to master branding. Rather than initially introduce a fragrance for one gender followed by a scent for the other a year or so later, the company has instead chosen to launch both the men’s and women’s versions at the same time — using one advertisement for both scents.
The strategy was seemingly successful with last year’s launch of the Curve fragrances, which many retailers termed the surprise hit of the year, and Claiborne is trying again this year with Liz Sport and Claiborne Sport.
Admittedly, said Neil Katz, the president of Claiborne Cosmetics, the concept “only works if you can talk to men and women in the same way,” a strategy that he said works best when the target audience is relatively young, such as Generation X.
“If you are approaching a more mature market, you can’t talk to men and women in the same way,” he said. “But with the younger generation, if you can find a psychographic position that appeals to both genders, you can adopt the same marketing approach, and it is more cost-effective.”
The success of designer fragrances — especially those targeted to younger consumers — has also contributed to the resurgence of master branding.
“The cosmetics industry is like the fashion industry,” said Robert Nielsen, president of Lauder’s Aramis and Prescriptives divisions. “You are only as good as your last collection.”
“We are clearly in the era of the designer,” he continued. “Aramis is a very important men’s fragrance name, but people identify with Tommy Hilfger the designer, the person. If there is a choice between buying a product with an accepted, well-known designer’s name versus one with an ethereal theme, there is no question where people will go.”
That strategy seems to be working for Aramis. Sales of its Tommy fragrance reportedly increased 30 percent last year, reaching an estimated retail volume of over $90 million, following the introduction of Tommy Girl.
Likewise, Lauder, which is reportedly spending $17 million on the launch of Pleasures for Men, is projecting a 15 to 20 percent sales jump for the women’s version. Although Burns declined to comment on the numbers, sources said that would give Pleasures an annual wholesale volume exceeding $70 million.
For his part, Cankes is conservatively predicting a 10 to 12 percent increase in sales for the Dune’s women scent after the men’s launch, while LoRe said she, too, is looking for double-digit increases in the original Hugo as a result of the Hugo Woman launch.
“You end up with a 15 to 30 percent increase in the first fragrance as a result of the halo effect of the master-brand advertising,” Burns said. “You strengthen the message by doubling the impressions.”
Although the success of the first fragrance is mandatory when introducing follow-ups, vendors said that doesn’t make the expense of launching a second any lower. Most companies still invest the same amount of money; they just get a bigger bang for their buck.
“We didn’t lessen our spending when we introduced Opium for Men,” said Donald J. Loftus, president and chief executive officer of Sanofi Beaute, referring to the brand’s U.S. introduction last year, which had a reported launch budget of $12.5 million.
“The difference is that if you already have something in orbit, you don’t have to use all of that fuel to get it off the ground,” he continued.
“I’m not sure that it’s really cheaper,” agreed Cankes. “Whether it becomes less of an investment is relative to the sales volume you’re going after.”
To launch Dune Pour Homme, Dior will spend about $2 million on advertising and promotional efforts, compared with the $15 million it spent to launch its latest women’s fragrance, Dolce Vita, last year.
But sales expectations are smaller as well. While Dolce Vita was reportedly projected to rack up a wholesale volume of $25 million during its launch period, sources indicate Dune Pour Homme — which will have a distribution of about 1,500 doors — is intended to achieve a $15 million wholesale volume.
Although Cankes declined to comment on the volume, he did note “the men’s business is traditionally about half the size of the women’s, and the amount of magazines we feel are needed to get the message across is fewer than it would be for a woman’s launch.”
The trick is to maintain the brand’s identity, while building a point of differentiation at the same time, LoRe stressed.
“You want to link them in the consumer’s mind, but you want them to have enough of a difference that the message is clear that one is for women and one for men,” she said.
Noted Lauder’s Burns: “You don’t come out with the second fragrance and reinvent the image and position of the first. That would defeat the purpose. The goal is to take the awareness and acceptance of the first fragrance, and make it more well known.”