FRAGRANCE FINALE: NOTHING TO SPARE
NEW YORK — One of the most difficult holiday selling periods of the decade for many department stores has ended with fragrance and cosmetics sales inching ahead of last year’s levels. But the margin was not great.
For Dayton Hudson, at least, sales were slightly ahead of last year’s, a bit off plan, according to Allen Burke, divisional merchandise manager of Dayton’s, Hudson’s and Marshall Field’s.
At Federated Merchandising, which coordinates buying for the seven divisions of Federated Department Stores, the December sales increase hovered in the low single digits Tuesday and is expected to edge into the middle single digits by the time the month ends, reported Michelle Williams, vice president and merchandise manager for cosmetics and fragrances. She described the business as on plan.
Specialty stores seemed to fare better, with Neiman Marcus exceeding plan. Saks Fifth Avenue showed a 10 percent fragrance and cosmetics gain for this month and a leap of nearly 20 percent for December and November combined, according to Deborah Walters, divisional merchandise manager.
The gain for the year, fueled mostly by color cosmetics and treatment, is 22 percent.
At the department store level, where volume is usually higher, so are the stakes, and Christmas was tougher.
According to Dayton Hudson’s Burke and Federated’s Williams, the difficulties of the economy were compounded by a lack of fragrance introductions and a paucity of promotional effort.
At both Dayton Hudson and Federated, men’s fragrances was a bright category, with Tommy by Tommy Hilfiger — a spring introduction — ringing sleigh bells. The scent finished December in the top volume spot at both retail corporations.
“It set a new standard,” Burke said. “It was out of control.”
Burke attributed Tommy’s success to the quality of the scent and the care that its parent, the Aramis division of Estee Lauder, took in controlling distribution. Retailers reciprocated by giving the new men’s scent every break they could, Burke added.
“If the product is right enough and the distribution is right enough,” he said, “huge things can happen.”
Burke cited “a couple of other surprises” in men’s scents — Hugo from Hugo Boss and 360 for Men by Perry Ellis.
Color cosmetics and treatment also was a strong category at Dayton Hudson and Federated.
But Burke added that women’s fragrance — traditionally a Christmas mainstay — was “a disappointment,” falling short of previous volume levels for the first time in memory.
The women’s fragrance business was flat at Federated.
“It’s so driven by what’s new,” he said. “Last year we had CK One. That fragrance had numbers that were so enormous, nothing could look like it.”
Not only was CK One a tough act to follow, with only Estee Lauder Pleasures constituting a blockbuster women’s launch in the U.S., but the shortage was exacerbated by the fact that Pleasures was not included in the women’s fragrance bar figures at most department stores, since it is sold at the Lauder counter.
In addition, the base of the prestige fragrance business continued to be undermined by what Burke called “the massive amount” of department store scents being dumped into the mass market through diversion. At Dayton Hudson and Federated, Clinique was a strong gainer, partly due to an increased December push with extra gift sets.
At Dayton Hudson, other hot cosmetics vendors were Lancome, Origins, Christian Dior, Chanel, Guerlain, MAC and H2O Plus, Burke noted, adding that the bath and body area was doing “extremely well.”
On the women’s bar, two other fall launches — Jess by Jessica McClintock and Forever by Alfred Sung — performed strongly. Burke said he was glad to see that CK One showed “a healthy increase” for the season. Because of CK One’s unusually strong launch results, beating those figures was a major coup this season for retailers across the country.
Dayton Hudson also elicited robust performances from Jean Paul Gaultier, Acqua di Gio from Giorgio Armani, Chanel, Adrienne Vittadini, Angel from Thierry Mugler, Tiffany’s Trueste, L’Eau d’Issey by Issey Miyake and Fath de Fath.
As noted, gift sets were strong in general this season, but collections of fragrance miniatures, hot in previous years, waned this time.
Last year, the miniatures were merchandised by Dayton’s on their own tables. This year, they had to share the tables with hot cosmetics products.
At Federated, the experience with miniatures was a patchwork. Some new sets, like Lauder’s Spray Wonders, Calvin Klein’s men’s sampler and Guerlain’s $39.50 perfumes, did well. Lancaster and Sanofi did not market sets this year, and Giorgio produced 50 to 60 percent less merchandise.
Parfum International produced fewer sets, but its sales were also 50 percent below last year’s, Williams said, noting that those results are in line with the brand’s performance following a decision by parent Elizabeth Arden Co. early this year to pull back on promotion and advertising.
Williams cited a correlation between levels of support and degrees of success. For example, Parfums International moved a gift-with-purchase promotion for Elizabeth Taylor’s White Diamonds from late November to last week and the brand staged “a tremendous comeback” for December, following a steep decline earlier. Arden’s True Love scent did very well, Williams continued, but Sun Flowers and Red Door did not, and the company’s Sun Moon Stars by Karl Lagerfeld sustained “very tough numbers.”
In analyzing the business, Williams noted signs of a shakeout in the works. Some vendors, like Sanofi, are focusing their businesses and shedding unworkable brands. Others are cutting support.
At the same time, the market, increasingly characterized by consumer indifference, has become more unforgiving than ever. Fragrances have to be well conceived and well supported, she said.
As a result, vendors are suffering tradeoffs, as well as complete misses, along with the hits. The Ralph Lauren division of Cosmair, for example, scored “high, high double-digit” increases with its basketball gwp for Polo Sport, Williams noted, but its Safari for Men lost some ground. Giorgio was a big hit with Hugo, but the company gave up volume on Wings for Men.
For Lauder, Pleasures was a dynamo and the company’s promotional blockbuster was “great,” Williams said, but Tuscany Per Donna had a”tough time” and Beautiful was “slightly affected” by the backwash from Pleasures.
Some of the women’s fragrances that had a “tough” December at Federated were Yves Saint Laurent’s Champagne, Casmir and Joop Pour Femme from Lancaster, Tribu from Benetton, Venetia from Laura Biagiotti and Nicole Miller.
Among the cosmetics vendors, strong performances also came from LancOme, Fashion Fair, Shiseido, Clarins, Origins, Princess Marcella Borghese, Christian Dior and Prescriptives.
The hotter-selling women’s fragrances included Chanel No. 5 and Coco, Givenchy’s Amarige and Ysatis, Dior’s Tendre Poison, Nina Ricci’s L’Air du Temps, YSL’s Opium, Guerlain’s Shalimar, Tiffany, Donna Karan and Miyake. Among newer scents, Federated did well with Jess, Forever and Gaultier.
In the men’s category, Federated also had strong performances from Paul Sebastian, Dior’s Fahrenheit, Chanel’s Egoiste Platinum and Anteus, Boucheron for Men, Joop Nightflight, DK Men, Herrera for Men and Acqua di Gio.
At Saks, top-selling scents included Chanel, Shalimar, Bulgari, Eau Parfumee, Cartier’s So Pretty and Lauder’s Pleasure’s, which pushed the company’s Beautiful out of the 10th spot. Saks also did well with Annick Goutal, Angel, L’Eau d’Issey, Boucheron, Joy, Van Cleef’s First, Tiffany and Trueste.
The cosmetics brands that provided much of the sales power at Saks were Lauder, Chanel, La Prairie, Sisley, Dior and Carita, Walters noted.
At Neiman Marcus, Dallas, John Stabenau, vice president, had something to smile about.
“We are very pleased with Christmas,” he said, noting that the chain finished ahead of last year. “We exceeded plan.”
Among his best-selling women’s fragrances — in no particular order — were Chanel, Quelques Fleurs, Bulgari, Boucheron, Annick Goutal, Cartier’s So Pretty, L’Eau d’Issey, Donna Karan New York and, in the cosmetics category, Pleasures. The hottest among the men’s scents were L’Eau d’Issey Pour Homme, Boucheron Pour Homme, Dolce & Gabbana, Escada, Hermes, Cartier’s Pasha and DK Men.
Stabenau added that beauty and treatment sales were “extremely strong.”
“It’s been a happy Christmas,” said Ed Burstell, divisional merchandise manager at Henri Bendel in New York. Although the gains on Bendel’s women’s fragrance bar were contained to the low single digits, the four-store chain’s overall beauty increase was in the high teens, he said.
“Makeup was fantastic,” Burstell said, “and accessories held its own.”
Among the best-selling color cosmetics lines — in no particular order — were MAC, Trish McEvoy, Bobbi Brown and Chanel.
Kenneth Lily, a line of environmental fragrances, was a hot seller. Volume was also strong for the entire category of scented, decorative candles, Burstell noted.
In the fragrance area, Annick Goutal was hot. So was the Jean Laporte collection and both Coco and Chanel No. 5.
Burstell said sales totaled “a few points” above plan and added, “I’m predicting a great spring for us.”
Robin Bartosh, chairman and chief executive officer of the New York specialty chain, Cosmetics Plus, will remember this Christmas as the season his business got buried in snow.
Bartosh had initiated a $1.2 million multimedia advertising campaign in November to spur fragrance sales and the business was on plan as the season headed into the week before Christmas. The goal was to chalk up an 8 to 12 percent gain for December, he noted.
That was before it started snowing on Dec. 19 — six days before Christmas — and the bad weather continued through the following Thursday.
“We’re going to end up about 3 or 4 percent ahead,” Bartosh lamented. He noted that his 15-store beauty specialty chain derives most of its customer traffic from midtown offices and weekend business is generally nil.