"A scent is like a mirror of personality. We want to be different and individualistic. Scent is like a dress that reflects the personality of the person who wears the fragrance. This is a signature scent. A perfume is made of both good and bad odors. It is a balance of doses that determines the quality of the fragrance. Of course, it is easier to compose pleasant smells, but standards and preferences differ with each individual. Cultural differences lead to a difference in taste.
"The luxury brand Hermes (est. 1837) diversified by entering the fragrance market 50 years ago with its first perfume Caleche. Over time, Hermes Perfume created new products, and updated its products to avoid an image of obsoleteness. However, the brand image is suffering despite the efforts in advertising. In this context, the sales of the product ‘Amazon' have dipped since 2005, despite a recovery in 2004.
Thus the question that arises is how can Hermes remedy the image of ageing to avoid declining sales in the years to come? Through this study, we present an external and internal analysis, and later try to offer solutions for the falling sales of the product.
Every day, 172,000 bottles of perfume are sold on average in France. Product sales suffered in late August 2008, registering a decrease of 3.2% in volume.
Globally, this luxury brand is worth 3 billion euros. Europe, which is the brand's largest fragrance market, represented 1.5 billion euros in total turnover in 2006, representing 46% of the world market share. Despite the current economic crisis, the perfume market does not lose value due to higher prices. It has been estimated that a Frenchwoman buys perfumes worth €190 annually. It may be noted that 94% of the women in France use perfume, and 54% use it daily.
2. The overall market:
The constant introduction of new products on the market (about 70 new flavors every year) maintains the revival and dynamism on the perfume market.
There is however a negative trend in sales volumes due to the crisis and decline in purchasing power.
On the fragrance market, there are different levels for each product:
- extract with fragrant component between 18 and 25% of the product
- Eau de Parfum, between 12 and 18%
- Eau de Toilette between 5 and 8%
- Cologne, between 1 and 3%.
The fragrance line from Hermes represents 10% of the turnover of the company. Indeed, its main activities are silk (29% of sales), leather (28%) and ready to wear (12%). The various trademarks in this market are Chanel, with 8.1% market share, Yves Saint Laurent which represents 6.7%, Dior - 6.4%, Lancome with 6.2%, and Guerlain with 5.6%. Remember Hermes has 3.5% market share.
Each fragrance is marketed under different packaging, a perfume is packaged either as in the bottle or spray form. The capacity ranges from 7.5 ml for the extract, 50, 100 to 200ml for bottles and sprays. Regarding the other products (scented deodorant, scented soap, shower gel, body cream), packaging varies by product, but is generally close to similar products (same function).
[...] Also, these brands adopt a common strategy: mass launch and huge communication budget (Chanel, Lancôme); the brand Dior's perfumes and cosmetics business has a turnover of 2.731 billion euros and ranks in the top position.The brand accounts for market share. Chanel: This company is in sixth place among the major perfume brands. Half of Chanel's sales are via fragrances. In 1921, the brand created the 'No. , which marked a revolution by its novelty and power. It is still the best-selling perfume in the world with market share and its flavors figure among the top twenty European perfumes. [...]
[...] The target First, Hermes has poorly defined its target in terms of the Amazone fragrance (women between 20 and subsequently, we decided to adapt the product to the target position, namely mature women (35 years and above). Second, to address the "antiquated" image and classic brand, while retaining the expertise and brand recognition, we decided to launch a new product, Nature by Hermes, thereby offering a special product to the population under 35 years The positioning Positioning of Amazone: Amazone is a refined fragrance for women, featuring a dynamic personality.The product is distinguished by its freshness, for a segment of mature women. [...]
[...] Following the high demand of the European market and the potential of the Asian market, Hermes can afford to establish a relatively high price, increasing margins and thus allowing to recover significant R&D costs because Nature is a new product. Table of prices of competitors via various distributors: The price of the new product was also determined on the basis of competition. Anais Anais by Cacharel, Noa by Cacharel and Lolita Lempicka are the main competitors of Nature in Europe. [...]
[...] Indeed, its main activities are silk ties and cravats of turnover), leather and ready to wear The various trademarks in this market are Chanel, with market share, Yves Saint-Laurent ( 6.7 Dior ( 6.4 Lancome ( 6.2 and Guerlain ( 5.6 Remember that Hermes has market share. Specifications for packaging: Each perfume is sold in different packaging, a perfume is packaged either as a bottle, or as a spray. The capacity ranges from 7.5 ml for the extract to 200ml for bottles and sprays. [...]
[...] Other products Furthermore, Hermes has chosen a strategy of diversification. Over the past decades, Hermes acquired: ? Confidence of its customers ? A reputation ? An image ? A sustainability The values Hermes for the consumer: ? Guarantee of quality, trust, sustainability ? Enhancement of consumer ? Recognition of the Hermes brand ? Product differentiation The Packaging: Primary packaging: The bottle is round with the ‘H' of Hermes on the mesh.The stopper is frosted white. Concerning the spray, it is a long bottle with trenches, and a golden cap to match the green leather. [...]
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