The Online Perfume Industry

Chris Butsko

Srinath Nagarajan

Yuenman (Priscilla) Pang

Major Players in Online Perfume Industry

• FragranceNet• LaParfumerie• Perfumania• MyPerfume• Fascination Perfumery• LoveMart• The Fragrance Counter• Jasmin.com

A Sample Front Page

Basics

• Consumers do not need to sign up online with perfume company

• Can shop anytime anywhere where they have access to web interface

• Go to the web site, select perfumes (or other products if provided), pay using credits cards (some sites also accept checks and money order), and arrange for shipping

A Sample Signup Page

A Sample Perfume Store

Online Perfume Industry

• Who are the customers?– “Over the past ten years, Perfumania, Inc.

focused on developing a chain of discount retail fragrance stores to meet the needs of today’s fashion-conscious, value-oriented consumers.” (Source: Perfumania)

• Who are the customers?– International customers => FragranceNet offers

shipping worldwide

Online Perfume Industry

• How do they attract customers?– Affiliation Program (FragranceNet, LaParfumerie)– Great Discounts (All)– Low price guarantee, beat competitor’s price by 5%

(FragranceNet)– Free Shipping and worldwide (FragranceNet)– Free wrapping (FragranceNet, LaParfumerie)– Gift with every order (FragranceNet)– Personalized service (FragranceNet, Perfumania)– Also provide complementary products like, cosmetics, hair/body

care, accessories, Lingerie, etc. (LaParfumerie, Lovemart)– Word of mouth (all)– Media Advertising (all)– Direct mail (FragranceNet, LaParfumerie, Perfumania)

Online Perfume Industry

Online Perfume Industry

• What types of value-added do the firms provide?– Advanced Search Criteria

• Special methods for you to explore collections of fragrances and find the ideal one.

– Search by brand to browse hundreds of fragrances for both men and women

– Search by fragrance family for descriptive characteristics such as aromatic, fresh, floral and oriental

– Search by interesting ideas, such as unique bottles, teens, classics etc.

– Inform, Educate and Entertain• Magazine – Ex. JASMIN Magazine• Search criteria like “fragrance family” help educate users

about fragrances

Online Perfume Industry

• What types of value-added do the firms provide?– REMINDER Services

• Ex. In FragranceNet.com, members of a club get email notifications of birthdays, anniversaries and other important dates

– Higher Buyer-Seller Interaction• Ex. In FragranceNet.com, customers can speak to a fragrance

specialist via e-mail or a toll free number

– Address Net-Buyer Concerns• High security. Ex. Billing Address must match credit card

address for the card to get accepted

Online Perfume Industry

• How do they get potential customers to try the products?– Experience good– Price Guarantee

• Ex. Fragrancenet.com guarantees that it will beat any competitors price by 5%!

– Offer promotions/guarantees to bring in potential customers

• Free US shipping and handling (FragranceNet)• Free gift wrapping (FragranceNet, LaParfumerie)• Free gift with each order (FragranceNet, PerfumeShop)• Guarantee to beat any competitor’s price by 5%

(FragranceNet)

Online Perfume Industry

• How do they get potential customers to try the products?– Free samples

• Jasmin.com – only with registration

– Strategic alliances to distribute samples to customers of• Vendors of related or other goods

– Ex. Online book stores, drug stores etc.

• Service providers– Ex. Email providers, ISP’s, Online Communities

Online Perfume Industry• Turning one-shot customers into repeat customers

– Personalized services (increases switching costs)• FragranceNet offers a “Reminder Club” in which a consumer

enters personally important dates (birthdays, anniversaries, holidays), and receives an email from the company as a reminder of an upcoming date

• Perfumania offers fragrance consultants to provide customers with personalized service and expert advice

– Offering complementary products• Perfume Center offers a link to HandyCraft.com, where hand

crafted goods may be purchased• Perfumania offers bath/body products, aromatherapy products,

and an electronic greeting card service at its web site

– Excellent customer service• Variety of companies offer an 800 number to talk to fragrance

specialist if cannot locate a scent• Also provides a store locator to find out where stores are for

customer to buy a certain perfume