FLARE FRAGRANCE

GROUP 2

Abhishek Dhruv 03
Aditya Sharma 04
Ashis Anshuman 15
Karan Parmar 24
Mallika Kandalgaonkar 30
Pranav Pandey 33
Sanket Gawli 43
 Current situation of the industry

● In US market, 2008, 74% women and 75% girls use fragrance products.
● The total US fragrances retail market was $5.7 billion in 2007, among them $3.8 billion was women
fragrances. Flare takes 9.5% market share, exceeded by Depuis, Suzanne Weber and Aromatique.
● Sales channels of fragrances include mass market, drug stores, department stores and others.
Key issue

● Flare wants to deliver at least $7.5 million

incremental revenue in 2009 and survive the severe
economic environment. Which implies 3.4% YOY
growth over the current 2008 sales of $ 221 million. Launch a well
● The strategies should therefore be evaluated on positioned new
their ability and probability to achieve this target. brand

Penetrate further
into upscale
Two methods are available as per Arlmont Associates
drugstore chains
● One involves launching a new brand which was
named as Savvy
● The other focus on Flare’s penetration into the
drugstore channel
 Evaluation of Each Option
● Project 1: Launching Savvy
● Project 2: Deepening Flare’s penetration into drug store channel
● Project 3: Launching a new premium brand targeting at high-end market and thus shore up and even
penetrate department stores/Prestige channel
● According to Exhibit 1, Flare’s shares of drug store channel and department store channel are 2.6% and
5.7%, with the each market size of $367 million and $930 million.
● To meet the goal of $7.5 million incremental revenue, the shares of drug store channel and department store
channel should increase by 2% and 0.8%, respectively, after the penetration.
● As is shown in Exhibit 6, Savvy’ s target market and its price are not so much different from those of other
brands under the Loveliest. Savvy is not a proper to be a breaking-out brand and is less likely to shore up
department store market.
● Moreover, since Loveliest already has five brands with it, the adding of another will not dilute so heavily.
Therefore, Savvy should be mass alternatives, which is a negative trend for premium brands. But the current
market is still large.
● The difficulty of rooting a new brand into the target consumers as they have low willingness to try new
scent. But once they choose this brand, they will have high loyalty.
 Penetrate further into upscale drugstore chains
Pros
● Mass market evolution as consumer traffic grows
in these stores
● They overhaul beauty departments by stocking
trendier fragrances and employing beauty
consultants
● Already have a drugstore sales force
● Well known brand with a strong prestigious
image
● Loveliest is 93% of sales.
Launch a well positioned new brand - Savvy
Pros
● Diversification of product portfolio
● Increases the age bracket of Flare
● Better utilization of channels
● Prevents stagnation of brand
● Infusion of much needed cash in ad budget
● Keep brand relevant
Cons
● Possibility of dilution of Loveliest brand image
● Drugstore reps even after suitable training has
shown uneven results
● Just over 20% of the people admit to buying
fragrance from drugstore (exhibit 5)
● Drugstore would typically want to sell only FLare’s
highest turnover items.
● Drugstore sales may harm brands relationship with
other channels
Cons
● Will increase cost
● May dilute the brand of Loveliest leading to loss of
loyal and faithful customers
● If the launch fails Flare’s position in the market will be
hard to gain back.
● Dulcet is suppose to launch around the same time
Savvy would
● Slow economy - consumers aren't buying.
Analysing buyers behavior for Flare’s product

Available segment in the market

Age group 35-64

Age group 18-34

● ● Prefers luxury brands

Chic brand oriented
● Mindfulness of prestige and image ● Heavy users
● Elegance and exclusivity ● Loyal to signature scents
● Believes in WOM ● Familiar with Loveliest since
● Ready to try out new products and youth
scents

It is important to keep certain things in mind before positioning ”Savvy” in the market:
Savvy is for a more younger group of people who are more worried about the Chic factor when contrasted with the
classic factor. These are young ladies who are still in school or beginning their vocation and are very little
acquainted with 'Loveliest’.

Our rival 'Aromatique' who has a higher retail share than us is launching out with another item called 'Dulcet' and
are focusing on a similar group of people ‘Savvy' will target.
THANK YOU !!