Coty opts for upscale

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Coty Inc. will resurrect the memory of its late founder when it upscales its mass-market fragrances next year.

It's not quite a return to the Lalique crystal bottles the company used early in the century, but Coty's chief designer wants to put a more elegant spin on its scents.

Coty already has begun upgrading package and advertising visuals, and new fragrances will aim for similar looks also, said Douglas Toews, exec VP-ideas and image.

Planned for 2000 are fresh ad campaigns for Aspen and Calgon; line extensions of Aspen and the Adidas line; and a new Esprit fragrance to be launched under a licensing deal with apparel marketer Esprit de Corp.

Mr. Toews said Coty will introduce a redesigned Web site next year and is working on ideas for new products in the Jovan musk line to exploit that brand's equity.

In spring '99, Coty confirmed it would phase out its mass-market makeup by yearend to concentrate on its core fragrance business. The marketer dominates the $1.1 billion mass-market fragrance segment in the U.S., thanks to a brand lineup that also includes Healing Garden.

While prestige products sold in department stores are becoming more casual in their look, Mr. Toews noted, mass-market offerings have used increasingly sophisticated packaging and advertising. Procter & Gamble Co., for example, packages its Oil of Olay lipstick in expensive-looking black-and-silver tubes, while Gucci America put its latest scent in a red plastic box.


Coty will introduce its Aspen extension, called Aspen Discovery, next spring. Creative, done in-house, will have the same outdoorsy quality as Aspen but a more individualistic appeal. The tag: "Find your own path."

"A lot of what we're doing here is going back to what Francois Coty envisioned for the company," Mr. Toews said.

The French parfumeur who started the company's fragrance business in 1905 was known for paying close attention to every aspect of product design. He packaged fragrance in bottles designed by Baccarat and Lalique and, in 1910, he used a designer from Paris' Ballets Russes to create the box in which Air-Spun face powder is still sold today.


Mr. Toews joined Coty in January, charged with overseeing the look of its packaging, communications and advertising. The image overhaul is part of Coty's effort to show how it has changed since it was spun off into a separate company in 1996 by parent Joh. A. Benckiser (AA, Feb. 15).

"We came here with a mandate from [Coty CEO] Peter Harf. It's been less than a year, and we think we're doing OK," Mr. Toews said. "The big steps you'll see in the year 2000, from the middle to the end."

The five-person ideas and image team Mr. Toews set up has begun reviewing the look of Coty's brands, concentrating on "mega-brands" such as Calgon and Healing Garden fragrances.

One of the first fragrance brands to get a once-over was Stetson cologne, Coty's best-selling men's fragrance in the U.S., with new print ads that started in November magazines.

The new ads, by Della Femina/Jeary & Partners, New York, kept the fragrance's western motif but updated the look by switching images from cowboys on horseback to ranchhands on motorcycles.


To encourage new ideas, Coty established brainstorming sessions in which representatives of its marketing and its research and development staffs around the world gather to create concepts for a particular line.

One such meeting last summer came up with an idea for a new Adidas fragrance that's being developed for launch next year, Mr. Toews said.

Coty is nearly alone in the mass-market fragrance segment, but that's not always a good thing, said Suzanne Grayson, president of consultancy Grayson Associates. Although it faces some competition from marketers such as Revlon, Unilever and P&G, none of them has a dedicated mass-market fragrance lineup of Coty's size and scope.

Coty markets 44 scents, while Revlon's offering, for example, is limited to its Charlie brand.

The mass-market fragrance segment isn't growing because there's no competition to stir things up, Ms. Grayson said.

According to data from Information Resources Inc., men's fragrance sales grew only 2.7%, to $450 million, during the 52 weeks ended Oct. 10, while the women's segment dropped 1.3% to $649 million.


There are opportunities in the mass segment, but it takes innovation combined with a strong commitment to marketing and advertising to spur the market, Ms. Grayson noted, adding that fragrance houses tend to have so many brands that they can't support them all appropriately and tend to cannibalize one brand's budget to advertise another.

Coty spent $36.8 million in measured media advertising in 1998 to support all its fragrance brands, and $8.4 million during the first half of 1999, according to Competitive Media Reporting.

"This is true of many things and it is true of fragrance -- one company does not a market make," Ms. Grayson said.

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