1.0 BACKGROUND OF CASE STUDY
Flare Fragrances Co., a manufacturer of women’s perfumes and currently ranked 4th in U.S women fragrances market. The brand is “Loveliest” introduced in 1975 became their flagship brand for many years. Since 1996, Flare introduced new brand every 2 to 3 years with each brand will have their flagship brand “Loveliest” on its label. Their latest brand launched in 2006, namely “Natural” is targeting younger generation. As a result, by 2007 fragrances product line contribute their main sales with 93% while 7% came from scented product.
Flare currently faces a growth challenge due to economic recession. Their expected increase in sales for 2008 is only about 2% as compared to 2007 an increase of 12%. As a result, …show more content…
Savvy’s product will be perfume, bath soup and body lotion with retail of $40 and trade margin 40%. Initial sales target for Savvy is about $7.5 million in 2009. As such, Flare has outlined three alternatives media plans for Savvy to penetrate departmental stores and mass market.
However, it is learned that Flares major competitor Aromatique are planning to launch new perfume brand namely Dulcet. The suggested retail priced would be around $42 and will be supported with budget of $10 million. 2.2 Increase effort of Flare's market penetration into the drugstore channel
Since Flares have already supplied their products into the drugstore channel this would another alternative for Flares to increase their sales in 2009. As the consumer traffic grows in drugstore chains promoting Flares product would be ideal choice in boosting sales for …show more content…
Flares management realised drug chain were evolving and had some higher-features too. However, Flare did not pursued drugstore actively as compared to effort made in mass market. Besides lack of focus, other constrains faced by Flare is that drug store demanded that they only wanted to sell Flares highest-turnover product. Should this happen, it will affect Flares relationship with other retailers.
3.0 RECOMMENDATION:
Based on the review of proposed alternatives by Flares CEO, the possible strategy to increase Flares sales in 2009 would be launching of new scent product. As part of branding positioning and Flares has a trend introducing new product every two years. Their latest product introduced in 2007 namely ‘Natural’. Introduction of Savvy to a younger market segment between ages of 18 to 34 opens up the possibilities of vertical expansion. As compared to Flares umbrella brand ‘Lovelist’ it has older age of group market.
Introduction of Savvy would be a better choice for utilization of different channels. This is based on study carried on focus group in 2008 where Savvy, could be sold initially at department stores before going into mass market. The sure study also found that 50% of customer prefer to shop for fragrance in department stores while 40% in mass
Flare Fragrances Co., a manufacturer of women’s perfumes and currently ranked 4th in U.S women fragrances market. The brand is “Loveliest” introduced in 1975 became their flagship brand for many years. Since 1996, Flare introduced new brand every 2 to 3 years with each brand will have their flagship brand “Loveliest” on its label. Their latest brand launched in 2006, namely “Natural” is targeting younger generation. As a result, by 2007 fragrances product line contribute their main sales with 93% while 7% came from scented product.
Flare currently faces a growth challenge due to economic recession. Their expected increase in sales for 2008 is only about 2% as compared to 2007 an increase of 12%. As a result, …show more content…
Savvy’s product will be perfume, bath soup and body lotion with retail of $40 and trade margin 40%. Initial sales target for Savvy is about $7.5 million in 2009. As such, Flare has outlined three alternatives media plans for Savvy to penetrate departmental stores and mass market.
However, it is learned that Flares major competitor Aromatique are planning to launch new perfume brand namely Dulcet. The suggested retail priced would be around $42 and will be supported with budget of $10 million. 2.2 Increase effort of Flare's market penetration into the drugstore channel
Since Flares have already supplied their products into the drugstore channel this would another alternative for Flares to increase their sales in 2009. As the consumer traffic grows in drugstore chains promoting Flares product would be ideal choice in boosting sales for …show more content…
Flares management realised drug chain were evolving and had some higher-features too. However, Flare did not pursued drugstore actively as compared to effort made in mass market. Besides lack of focus, other constrains faced by Flare is that drug store demanded that they only wanted to sell Flares highest-turnover product. Should this happen, it will affect Flares relationship with other retailers.
3.0 RECOMMENDATION:
Based on the review of proposed alternatives by Flares CEO, the possible strategy to increase Flares sales in 2009 would be launching of new scent product. As part of branding positioning and Flares has a trend introducing new product every two years. Their latest product introduced in 2007 namely ‘Natural’. Introduction of Savvy to a younger market segment between ages of 18 to 34 opens up the possibilities of vertical expansion. As compared to Flares umbrella brand ‘Lovelist’ it has older age of group market.
Introduction of Savvy would be a better choice for utilization of different channels. This is based on study carried on focus group in 2008 where Savvy, could be sold initially at department stores before going into mass market. The sure study also found that 50% of customer prefer to shop for fragrance in department stores while 40% in mass