INNOVATING FRAGRANCE SALES AT MASS:
Why Are We Still Talking About This?
Fragrance is part of our everyday lifestyle. Seventy five percent of women say they consider fragrance a part of their beauty
routine, while 80% say they wear it at least once a week.1 Despite its popularity, fragrances sold at drug stores are struggling.
In 2013, the sale of mass-market fragrances sold in drug stores sank 6%.2 How can we reverse this slump? By giving customers
new and exciting access to the product using multiple sensory points: touch, smell and sight.
Drug Store
Department Store
Drug Store
Impulse Buy
Department Store
Impulse Buy
Let’s examine possible Drug
causes
experience
at drug and department store retail.Impulse Buy
Store for the slump by comparing a typical shopping
Department
Store
Drug Store
Our customer enters
the drug store with a
shopping list in hand and
finds herself engaging
in impulse shopping as
she wanders through the
open sell aisles. In the
distance, fragrances hide in a locked cabinet “prison.”3 No
testers to smell, no packaging to touch, no marketing to see.
If a fragrance isSlump
not on her shopping list, she has no motivation
to seek it out; no sampling, no sales
support, no marketing,
Slump
no bells and whistles to get her attention. If fragrance is on
Slump
her list, she must chase down a sales person
for assistance.
Department Store
As our customer lands on
the beauty floor of a popular
department store, she walks
into an engaging environment.
Manned by attentive fragrance
specialists, our customer is
whisked into the passionate
and glamorous domain of
fragrance: innovative displays,
readily available testers, memorable tester strips, generous
samples
Solution and clever marketing messages. Our customer
is easily romanced into
its world and all of her senses are
Solution
engaged. Shopping for fragrance at a department store is
both a commercial experience andSolution
a meaningful ritual.
What Does This Mean?
By locking up fragrances, drug stores have taken the allure and fun out of shopping.
Behind locked doors we can’t touch them, hardly see them and certainly can’t smell them!
As other beauty sectors continue to climb in sales, locking up fragrances will only continue
to hinder growth.3 The 2013 slump in mass sales is a continuation from 2012 when mass
fragrance failed to reach the $1 billion mark in sales for the first time in years.
The psychology of impulse buying supports this argument about how mass fragrances are sold. Two-thirds of the economy
is impulse buying and in order for the customer to make an impulse purchase, they have to have exposure to the product.4 In
a drug store, there is room for impulse buying because many products are within reach – except, of course, for fragrances!
While the fragrance market is expected to grow through 2018, mass fragrance sales are still expected to struggle compared
to the growth of prestige brands. One reason for this is the influx of scented body sprays, shower gels, and body lotions in
drug stores.5 Unlike fragrances, these products are conveniently located free from locks, on the shelves for easy access to
shoppers. These “scented” products fulfill a customer’s fragrance needs without the hassle of the locked case.
We Know, Loss Prevention Is An Issue, But…
Clearly shoplifting is a problem. Petty theft and organized retail crime account for a huge loss in the retail industry.6 Between
2012 and 2013, retailers lost more then $36.6 billion due to theft.7 Health and beauty products, especially fragrances, make up
some of the highest percentages of stolen products with a shrink rate of 3 to 4%.8 We understand why retailers feel like they
don’t have a choice but to lock up products or risk stolen goods. But with drug store sales down 6% for fragrances, retailers
and brands must look at innovative and disruptive options. We’ve seen the one-off tester bar, the one-off fragrance bottle
tester locked to a classic visual display unit, and we’ve read the articles where brands tell us they are doing more. But from
our vantage point, talk is just talk, and this industry has no choice but to adopt needle-moving strategies.
Department Store
Impulse Buy
How can we wake up fragrance sales at drugstores?
Inspiration can be found in all sales channels – there is no lack of innovation around us:
+ Street facing ATMs that dispense fancy cupcakes.
+ An app that gives the user a genius 3D virtual makeover with unparalleled accuracy.
+ Department store brands moving from counter style kiosks to open sell environments.
+ Prestige skincare sales staff wearing a name tag that plays a video advertising campaign.
+ Sophisticated CRM systems that allow for great intimacy with customers.
So What’s theSolution
Solution? (Want more ideas? Give us a call.):
With cigarette sales at drug stores going the way of the dinosaurs, we will repurpose
the cash/wrap area as a visual merchandising hub for fragrance. It provides a safe
space for these goods as sales people are in place at this location on a constant
basis. As customers line up to check out, this region of the store gets the most
number of eyeballs without coaxing.
Here we take inspiration from beauty specialty retail and department store
merchandising to create a compelling, visually arresting zone that engages the
customer’s senses of touch, smell and sight:
+ A sleek video monitor plays fragrance commercials and other fragrance marketing.
+A
backlit wall of “dummy” fragrance bottles removed from their outer carton
revealing the most exciting part of the packaging.
+A
t the register, an entertaining fun-to-play tablet-based interactive fragrance
matchmaking program, supported by a line up of four product testers.
All key points of engagement are easily updated, rotating featured items with little maintenance by the store staff. This new
fragrance hub creates an area for easy interaction between the customers, sales staff and the alluring world of fragrance appealing to multiple senses. Saleable product inventory will be stocked under the wall in locked cases.
Base Beauty is ready to partner with retailers and brands thirsty to incorporate this type of innovation into selling fragrance at
mass retail:
+ Which retailer is willing to rewrite the rules around fragrance sales?
+ Which fragrance manufacturer is willing to invest in marketing innovation to push fragrance engagement and place story
telling at drug stores as a fundamental branding priority?
+ Who is ready to drive excitement back into fragrance?
1 “Fragrance Report Reveals Consumer Habits, Favorites.” CEW Beauty Insider. CEW. 29 July 2014. Web. 31 July 2014.
2 Mahoney, Sarah. “High-end Beauty Sales Up; Mass Products Struggling.” Marketing Daily. Media Daily. 7 Feb. 2014. Web. 28 July 2014.
3 “The Mass Market Landscape is a Tale of Two Scenarios.” CEW Beauty Insider. IRi. 2 April 2013. Web. 31 July 2014.
4 McPherson, Doug “The Psychology of Impulse Buying.” Specialty Retail Report. Fall 2005. Web. 28 July 2014.
5 Alexander, Antoinette. “Mass Trades Fragrance for Bath Scents.” Drug Store News. 18 Feb. 2014. Web. 31 July 2014.
6H
ughes, Judy and Roberts, John. “Product Protect- Beyond EAS.” LP Magazine. 1 March 2014. Web. 31 July 2014. Jarman, Max. “As Criminal Gangs Get
Smarter, Retailers Find Tools to Fight Back.” The Arizona Republic. 2 Oct. 2011. Web. 31 July 2014.
7 Canfield, Amy. “Retail Shrink Costs $37 Billion a year in US.” Security Director News. 18 Nov. 2013. Web. 31 July 2014.
8 Bradford, Chris. “Typical Annual Inventory Shrinkage.” AZ Central. N.d. Web. 31 July 2014.
Jodi Katz, President & Creative Director
349 Fifth Avenue, New York, New York 10016
[email protected] • 917-703-4580
www.basebeauty.com • Instagram: BaseBeautyCreativeAgency