I am awaiting delivery of a new perfume compound -- a men's fragrance which I will market as a "cologne," even though it will be perfume strength by its use of alcohol.
I have always tended to "cheat" a bit when it comes to deciding the ratio of compound to alcohol for a men's product. Fillers sometimes complain but customers appreciate the fact that my fragrances are "long lasting," which surprises them because most men's fragrances are not.
Being generous with quality is good business but let's get right down to the big issue -- packaging and pricing.
I am assuming that my new male fragrance will be a "hit." It was intended for a special audience -- not the mass market -- and I'm hoping that those for whom it was intended will like it enough to give me repeat orders. I will offer samples to let them try it first. Men who like a fragrance (teenagers excepted) tend to wear it for many years. Teen guys are still experimenting, exploring "mass" taste, finding their own taste, and they can be a very fickle market, just like teen girls.
But lets assume in advance that my new project will be a hit. Let's focus on the really big issue -- packaging -- which is the issue which will determine the price I can charge.
While I would like to think that my fragrance is so spectacular that it, alone, will draw orders, the reality is that most sales will be closed by the credibility of the packaging. If I have "nice" package, I can charge more. If my packaging is less distinguished, I'll have to settle for less. But I have two big problems here -- first, I am not a package designer, and secondly, I am planning to fill at most a few hundred bottles of my new fragrance and I don't want to offer this product for sale unless I can sell it at a profit.
Does this "problem" sound familiar?
Frankly, I don't know a graphic designer I could both afford and trust with the project. I'm sure that if I had more money to spend I could find one but my "account" isn't sizable enough to attract designers who will give me highly professional presentations "on spec." That's the current reality.
Then there is the issue of quantity. Printers have minimum runs. I have yet to find a "stock" box that fits my needs nicely so any box or tube would have to be "custom" -- which means a minimum order in excess of 1,000 units -- or perhaps even 5,000 -- even though I might only want from 100 to 500.
Now for this project there is an additional "complication." I am planning to offer my new fragrance in three different sizes -- sampler size, a 50ml "sprinkler neck" bottle (no spray pump), and (possibly!) a rather nice 100ml bottle with a glass stopper (which will cost me an arm and a leg!)
So now you see my limits and my ambition. How would YOU deal with the pricing? It is, after all, critical to the success of the project.
There must be a consistency in my pricing structure. When measured on a "per milliliters of fragrance" basis, my sampler has to be the most expensive and my middle size "ordinary" bottle has to be the least expensive. The large, exotic bottle can command a premium price due to its unusual beauty.
So let's look at some possible pricing.
Suppose I decide to price my big, beautiful, 100ml bottle at $240. Ignoring the cost of the bottle and packaging, that puts the price of the fragrance at $2.40 per milliliter.
Now let's address the price to be charged for samples. I plan to use a 3ml spray vial here. I have them in stock already. So if the price of the fragrance in my sample were to match the price of the fragrance in my big bottle, the sample would be priced at $7.20.
But I don't believe that a single sample vial will be large enough to "hook" new customers on my cologne. So I'll want to deliver a package with two sample vials. That brings it to $14.20. By rounding this UP to $15.00 I have now made the fragrance in the sample MORE EXPENSIVE than the fragrance in the "big bottle."
The reason I want to do this is simple. If people really WANT my cologne, I don't want them to be able to save money by buying lots of cheap samples in lieu of regular size bottles. Hence, my samples aren't going to be cheap -- they are simply a way for the customer to make a more affordable TEST of my new fragrance.
Now let's get real about $240 bottles. How many do I really expect to sell? Truthfully? Not many.
My big hope is for a bottle with an intermediate price. As it happens, I have a generous supply of 50ml sprinkler neck bottles on hand along with caps for them. These bottles and caps were acquired at a favorable price so, if I can sell my new cologne in these bottles, I can make a handsome profit. How, now, should I price my 50ml bottles?
At our original number, $2.40/ml, the 50ml bottle would be priced at $120.00. But this isn't a fancy bottle so I can charge less. But I want to keep the price "premium" so I'm not going to try and match the prices of men's fragrances at the mall. (While the packaging of these mass market fragrances may be far more expensive than mine, and while they have been created by perfumers with far more experience and talent than mine, my compound uses far more expensive ingredients than theirs AND the scent of my new fragrance would never make it in the "mass market" as it would be far too controversial for most men, far too "far out," far too "edgy.")
So on the one end of the scale, I have a top price of $120 and on the other end of the scale, a "mall price" of say, $45. I want to be in the middle so I'm going to go with $85.00.
Now ask, "why not $84.99?" Or even $79.99? To boost sales by giving a perception of a lower price.
The answer is simple. I don't want the perception of a lower price! I want the perception of "this IS the price. If you can't afford it, it isn't for you." Yes, I want a price that says, "My fragrance is for those who can pay the necessary price. Take it or leave it. And, if you leave it, it is probably because you can't afford it ... and I didn't make it for people like you. Sorry, go out and get rich like my real customers. Then buy my fragrance."
As I write this, the compound for this new fragrance is in transit to me from the people to who were entrusted to make it from the formula I gave them. The alcohol I will be using is already here. When the compound arrives, there is the business of mixing the compound with alcohol. Then it all sits for a while and gets nicely mixed. Then the bottling begins.
If you want to follow the progress of this men's fragrance which has not yet been named, go to this web page where it will be offered for sale. The samples should be available around May 30th, 2008. Now here's that link: