Top scents boost budgets

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Key players in the fragrance category are increasing marketing budgets in the hopes of drawing attention to old and new brands. L'Oreal USA's Ralph Lauren Fragrances division is set to raise spending 15% this year as it launches a variety of products from an elite men's fragrance to its first hair-care line. Estee Lauder Cos. will put major muscle, including TV, behind its flagship Aramis brand for the first time in a decade. Coty's Lancaster Group Worldwide likewise plans to increase efforts behind a host of brands.

Banc of America Securities analyst Bill Steele suggested that the boost in spending is much needed for the increasingly fragmented industry, where a recent spending curb has likely contributed to the category's weakness.

This fall, Ralph Lauren will launch an exclusive fragrance, Ralph Lauren Purple, in only 110 high-end outlets, including Polo stores and specialty department stores such as Neiman-Marcus and Saks. Though typically Ralph Lauren fragrances are carried in at least 1,800 outlets, including mainstream department stores, this limited-distribution strategy of Purple, also the name of Ralph Lauren fashion's couture line, is an effort to access the very upper echelon.

"Specialty retailers won't give a brand support if it's sold in the larger universe of department stores," said Andrea Robinson, president of Ralph Lauren Fragrances. But access to the high-end database of such stores is a crucial part of the buzz-marketing strategy of Purple, which will include coordinated efforts with the marketing of couture fashion line and sampling events for special VIPs. The upscale men's fragrance may be the first in a line of similarly targeted fragrances if all goes well, Ms. Robinson said.

As it reaches out to the elite, Ralph is also venturing into the mass-marketed $1 billion hair-care arena with the launch of a hair-care/fragrance line for teens under its Ralph banner dubbed Ralph Good Hair Day. The hair-product category is the second-most-popular category for teen purchases next to the $1.8 billion fragrance arena, Ms. Robinson said, and is the fastest-growing. Other prestige brands that have extended into hair care, among them Clinique and Lancome, are now only niche businesses, Ms. Robinson said, but she expects Good Hair Day to be bigger because of its positioning as "a new way to fragrance oneself." Good Hair Day will be supported by a large-scale print campaign in teen fashion magazines as well as through celebrity events and sampling in key malls throughout the U.S.

mainstream push

The roughly $15 million launch this September of Ralph Lauren Blue is the division's effort to reach mainstream women with an updated version of its now-lagging 25-year-old Lauren brand. To mirror the success of its male counterpart, Polo Blue, which launched last year, the division plans a large-scale print campaign launching in the September issue of Conde Nast Publications' Vogue and a slew of special in-store details down to silver-handled shopping bags and jungle leaves on counters.

Meanwhile, Estee Lauder will use a celebrity endorser for the first time in its history as it tries to build the equity of its 35-year-old Aramis brand. Tennis star Andre Agassi is the face of the line's new extension, Aramis Life, which will be supported by a more than $15 million print and TV effort tagged: "Life. It's a great game."

keen positioning

Mary John Baumann, executive director for global marketing for Estee Lauder's Aramis and designer fragrances, said that the tough environment for fragrances means "we have to be keener about how we position products and bring them to market." That theory has driven the significant budget increase (Estee Lauder spent less than $1 million in measured media last year per TNS Media Intelligence/CMR) as well as new tactics for the brand including newspaper advertising and a major outdoor buy in its top 20 markets.

Lancaster Group President Michele Scannavini agreed that the recessive U.S. market-which he said has driven fragrance sales in department stores down roughly 5% this year and is not expected to get better in the near term-has demanded that the division reinvest in its brands, including its new Jennifer Lopez fragrance, Still; new Kenneth Cole Black and Pure Jil Sander as well as the 2004 launch of Marc by Marc Jacob. "We're putting more money into communications-both advertising and in-store-as part of a big effort to enforce the equity of our brands."

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