NEW HERMES BEAUTY CHIEF TALKS STRATEGY

Byline: Julie Naughton

NEW YORK — Veronique Gautier, the new chief executive officer of Hermes’s beauty business, has been on the job barely a month, but already she’s digging her heels into the upscale brand.
“My goal is to double our fragrance business in the next five years,” said Gautier. While she wouldn’t talk numbers, industry sources estimated that Hermes does about $55 million globally at retail in fragrances, with the U.S. accounting for about $10 million of that figure.
Gautier is no stranger to the luxury business. Most recently international marketing and European sales director at Cartier Parfums, she has also been the head of Paco Rabanne’s international group. She started her career in Chanel’s international marketing department. At Hermes, Gautier replaced Remy Gomez, who was named president of Beaute Prestige International in September.
While Gautier isn’t yet outlining specifics for doubling the Hermes beauty business, she said that much of the growth will likely come from line expansions. “Hermes has many strong, viable fragrance brands, and there are a lot of additional possibilities for each brand,” she said. “We will expand our brand equity by working closely with all of the Hermes products. And first and foremost, you won’t see Hermes in every door in the land. We’re not expanding retail. We have a little less than 200 points of distribution in the U.S., and that makes it exclusive. To create desire and excitement, you simply can’t be everywhere.”
Gautier’s first priorities are growing the already healthy U.S. and French businesses — “Our number-one and number- two markets, respectively,” she said, adding that the firm’s Japanese business is also very strong. “But I want to be even stronger where we already are before we attempt to break new ground. We’ll be defining this strategy more explicitly in the next five to six months, but our boutiques — already an important part of the business — will play an even bigger part going forward.” In fact, as the business grows, she plans to be more vigilant than ever in controlling and maintaining distribution.
She sees fragrance as a ritual — a strategy that will be built upon in future launches, including one that will likely come at the end of this year. “Women are searching for new uses for fragrances,” she said. “They aren’t just spritzing themselves. They are perfuming their bedrooms, their living rooms. Hermes can be an actor in this new ritual. It’s all coming back to luxury.”
A mention of one of Hermes’s most recent European launches, Hermes Rouge, draws a smile from Gautier. A sultry little sister to Hermes’s classic Parfum Hermes, Hermes Rouge is an Oriental scent with amber and floral notes that is intended to be the most feminine of the 10 Hermes fragrances. Unlike other Hermes scents, however, it was launched with a bright red lip color, Rouge Hermes, which is the first color cosmetic the brand has done. The lipstick is also scented with the Hermes Rouge fragrance.
Creative thinking like that may well play a part in future Hermes launches. “The idea of launching the color and fragrance together was brilliant,” Gautier said. While the line launched in France last fall, it reached the U.S. in January. Gautier wouldn’t talk numbers, but industry sources have estimated that the Rouge Hermes lineup — which includes Hermes’s first solid perfume, as well as a 7.5-ml. eau de parfum spray, three sizes of eaux de toilette and ancillaries — could do $15 million to $20 million at retail worldwide in its first year of distribution. If it does these numbers, it would be the largest Hermes fragrance launch since 24 Faubourg in 1996.
And Gautier is determined, as she expands the Hermes fragrance franchise, not to cannibalize existing business — and that means being selective in new product launches, she said. “In the long term, you won’t see a new fragrance from us every month, but what you will see will be elegant, classic scents, things that will still be available in 10 years,” she said. “We want to do things that will last.”

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