NEW YORK — After close to three years of sluggish sales, the women’s fragrance market is showing signs that it is sputtering back to life.
Major retailers reported flat sales to low-single-digit increases in Mother’s Day fragrance business, as well as strong color cosmetics and treatment sales for the holiday. While Mother’s Day wasn’t quite the blockbuster that many were hoping for, the fact that business wasn’t down was reason enough for most to celebrate.
Several surprising observations came from this holiday’s results. While newness is generally credited for driving the business when there’s a pop in scent sales, several retailers said that the majority of their business for this Mother’s Day was driven by classic scents such as Chanel No.5, Calvin Klein’s Eternity, Estée Lauder’s Beautiful and Donna Karan’s Cashmere Mist. In several major chains, luxury scents and sets outperformed their more value-oriented counterparts. And perhaps most surprising of all, while the color cosmetics and treatment categories are not traditionally strong Mother’s Day sellers, in at least one major chain they drove most of the growth for two of the top three department store beauty brands, Clinique and Lancôme.
“The fragrance business has been unexpectedly better [this year] than planned,” said Thia Breen, executive vice president of cosmetics for the Federated Merchandising Division, noting that the resurgence of the category in Federated’s stores began building earlier this year and continued to do so through Mother’s Day. Against last year, Federated saw a low-single-digit increase in the women’s fragrance category, she said.
Clearly, classics were a big driver at Federated for Mother’s Day. “Of our top 10 [fragrance] brands, only one was new,” said Breen. “Our concentration in the classics is paying off. It’s very important for us to launch new brands, and we love to have them, but going forward it’s going to be very important for us to focus on our core brands while continuing to add newness.”
Breen noted that Estée Lauder’s Beyond Paradise continues to do “very well,” while Chanel No.5 has seen “unbelievable, great growth — all of the Chanel fragrances did very well.” Another classic entry, Dolce & Gabbana’s Light Blue, is also doing well, she said, as is Escada’s fragrance portfolio.
A major department store retailer who declined to be named noted that business was flat to slightly ahead for Mother’s Day, with the classics racking up the strongest business. “Chanel No.5, Cashmere Mist, Eternity and Eternity Purple Orchid [a flanker] and Beautiful all did well for Mother’s Day,” said the retailer, noting that Lauder’s Beyond Paradise also did strong business. However, the retailer noted that gift set sell-through was not as strong as it was last year. “It doesn’t seem to be a cost issue as the more expensive sets sold through very well for Mother’s Day,” said the retailer. “It seems to be about the luxury impression and the size impression — that is more important than ever before.”
And, while Mother’s Day is generally thought of as a boon for fragrance sales, two of this retailer’s largest brands had sales come from elsewhere. “Clinique and Lancôme both did well for Mother’s Day, but in both cases, it was not driven by fragrance sales but by color and treatment,” said the retailer.
The holiday was decent, but the retailer foresees a challenging path for the business looking toward the end of the year. “Newness will flourish — but at what cost?” the retailer wondered. “I think, in the second half of the year, brands that support their items — new or old — with in-store events and promotions will do well.”
“Mother’s Day was OK,” said Jon Pollack, executive vice president and general merchandise manager at Belk Inc. “We had a low-single-digit increase in ladies’ fragrances, so we were pleased.” Pollack believes “strong performance from classic [scents] and strength from new entrants” drove the category. “Chanel No.5, Coco Mademoiselle and Chance all did very well for Mother’s Day,” said Pollack. “The Cashmere Mist business for Mother’s Day was exceptional.” Among new entries, Estée Lauder’s Beyond Paradise was “very strong, [as was] Attraction from Lancôme,” said Pollack. “[Giorgio Armani’s] Sensi, a new brand for us this season, was very strong, and Lacoste and Kenneth Cole Black were good.”
Customers weren’t afraid to spend either, Pollack noted. “A business that was tremendous for Mother’s Day,” he said, “was the upper-end of our assortment in terms of price point. Brands like Vera Wang [for women], Boucheron and Angel did especially well.” Meanwhile, customers also were in search of value, as evidenced by sales of sets. Said Pollack: “There was a conservative buy-in but we did get good sell-through [of sets].”
In the men’s category, Pollack saw low-single-digit increases for the Mother’s Day selling period and season-to-date. For fall, “We’re seeing a lot of newness, the majority of which is on the women’s side,” said Pollack. “A lot of excitement is being added to the assortment and we’re planning low-single-digit increases.”
Howard Kreitzman, vice president, divisional merchandise manager of cosmetics and fragrances for Bloomingdale’s, said he was “pleased with our performance against last year and plan.” He noted that “performance was better prior to the Mother’s Day run-up than when we actually got into the Mother’s Day business,” which he described as “just OK.”
He added that the spring fragrance launches have all been “consistently good” but none “performed better than our expectations.” Kreitzman noted that the biggest promotion has been the opening of the SoHo store and, based on performance, “we’re staying the course and not making any drastic changes to our strategy.”
Men’s fragrance highlights include Michel Germain’s Sexual, Vera Wang, Ferragamo’s Subtil and Zegna. Looking forward to fall, he noted, “the number of women’s fragrance launches is very impressive” and, for the most part, there is “something from each of the big houses. We’re excited about all of the new opportunity that’s out there.”
Mother’s Day “was great,” said Muriel Gonzalez, senior vice president and general merchandise manager for nonapparel at Bergdorf Goodman. “We had a very good week,” she said, citing Clive Christian, Annick Goutal, Hermès, Fracas and Bulgari as performers. Chanel and Guerlain also did well. Rather than relying on newness to drive the business, “I think it’s about developing fragrances over the long haul,” said Gonzalez. “Within fragrance, newness causes a pop but our business has been developed on personalized service.” The men’s business has also been good, particularly Acqua di Parma, she said.
Still, a few retailers were downright grumpy about Mother’s Day. “I’m not happy,” Gary Borofsky, Rich’s vice president and divisional merchandise manager of cosmetics, said bluntly. “Last year, Mother’s Day was strong, [this year] we underperformed.” Prior to the holiday, Borofsky was expecting a last-minute rush to generate low- to mid-single-digit increases over Mother’s Day last year, but the opposite took place.
“It was all due to 48 hours,” Borofsky said. “Friday and Saturday. Up to that point, it was doing well; we were cruising, [and] well-positioned. Our marketing and promotional [strategy] was comparable to last year. We’re trying to figure out what happened in those last two days, [which] didn’t give us what we thought they would.” Looking ahead, “We’ll work with vendors at the end of May and in June to come up with events that will drive June,” said Borofsky. “It’s hard to offset a Mother’s Day miss — [there is] not enough time to offset that kind of [decline].”
New, limited-distribution and flanker scents were the performers, he noted. More widely distributed fragrances were not as strong. “Newness was 28 percent of the business,” said Borofsky, “but the existing business was down in the mid-twenties [percentile].” New scents like Beyond Paradise, Givenchy’s Very Irresistible, Kenneth Cole Black, Boucheron’s Trouble, Lancôme’s Attraction and Escada’s Island Kiss did well. Existing fragrances that performed included Cashmere Mist, Chanel, Vera Wang’s eponymous women’s scent and Calvin Klein Eternity.
“Mother’s Day was soft but hopefully we’ll get back on track,” concluded Borofsky. “We’ll reorganize and head into holiday still optimistic. The celebrity season is out there for fall,” he added. “There’s a lot of exciting newness that will drive the customer to the counter and when that happens, we win.”
“Newness is still driving business,” noted Robin Burns, president and chief executive officer of Intimate Beauty Corp., Victoria’s Secret Beauty and Aura Science. In the week leading up to Mother’s Day, the store experienced double-digit overall growth against the same week last year. The store’s women’s and men’s overall businesses were each also up double digits, she said.
One of the brand’s promotions, a shimmer body puff for several of the brand’s fragrances, proved to be a blockbuster, Burns said. “We actually did something similar last year, and it sold out in a few days” she said of the item, which was sold for $12 with any $35 beauty purchase. The promotion was offered among eight prestige and four garden fragrances.
“This year, we decided to expand on that idea, and we are enjoying great gains with it,” she said. “That type of growth is consistent with what I’ve seen since holiday: The more interesting the innovation, the faster the customer is to respond. Sometimes, when business is tough, people pull back on newness. I think that one of the things that ensures success is to be innovative, because consumers are much more savvy these days. They are used to getting newness with much more speed.”
Burns is also experimenting with adding non-Victoria’s Secret-branded beauty to a few stores. She plans to add the Pout color line in three markets — Los Angeles, Detroit and Dallas — in about three stores in each area. Its Herald Square store in New York — said to do upward of $8 million in beauty sales yearly — will also get the line. “Although we’ve had a Victoria’s Secret Beauty color line, when we tested Aura Science color we found that we were achieving significant incremental gains,” she said. “We’re looking to see, with this test, how many color lines we can handle and still achieve incremental business. We’re not looking to handle a huge number of color cosmetics lines, but we would like to offer choices that appeal to different consumers.”
Burns also noted that the success of the chain’s Herald Square door has given birth to a new store design for upcoming stores: beauty front and center, with lingerie wrapped around the department. “So many beauty purchases are made on impulse,” she noted. “This store design maximizes that buying pattern.” Among this spring’s top sellers: Very Sexy for Her 2, the Bronze Goddess color collection, Sweet Talk Lip Glosses and Breathless body bronzer.
Rod McFadden, vice president of divisional merchandising for Sephora, said, “May should be our best month of the year so far, based on our first results. The first third of the year has been very good for fragrances at Sephora. Our top-ranking brands are all comping up in healthy double digits, and new brands in our lineup like [Jessica Simpson’s] Dessert, Benefit and Pink Sugar are adding nice incremental business. Our women’s business is posting nice comp increases in the teens. We are seeing solid growth in ‘big name’ brands, as well as increasingly strong business from emerging and limited-distribution brands.”
He said Sephora has had success with limited-distribution brands like Kenzo, Hanae Mori, Demeter and Hermès. Also doing well at Sephora are Nanette Lepore’s new fragrance, Kenneth Cole’s fragrance lineup, Cacharel’s Amor Amor, Issey Miyake’s summer scent and Ralph Lauren’s Cool, as well as gift sets from Stella McCartney, Lolita Lempicka and Burberry’s Brit. Men’s has been “less robust” than women’s, McFadden said.
While reviews may have been slightly mixed in the U.S., things looked bright north of the border. Shelley Rozenwald, senior vice president of cosmetics, skin care, fragrance and beauty services at Canada’s Holt Renfrew, had “high expectations” going into Mother’s Day. And she wasn’t disappointed. “We had an 18 percent increase over the same 10-day period before Mother’s Day last year,” she said, noting that sales of new and existing fragrances were driving the business. In addition to fragrance, “we had excellent growth in color cosmetics and skin care, as well.” She noted that the men’s business also has been strong. Fragrances from Cartier and Jo Malone were top sellers during the Mother’s Day period, she observed. Hermès and Issey Miyake scents also performed, as did Gucci and Dessert.
For fall, “it’s going to continue to be good,” said Rozenwald. “We had an excellent fall season last year and as long as the market introduces new and exciting fragrances, customers will buy. They want to be romanced and enticed.”