Wednesday, January 7, 2009

The wrong way to think about launching a perfume business

No successful marketer of perfume has ever started at the top.

I regularly receive emails and phone calls from people who have some money and want to launch a perfume AND get instant distribution with major retailers. So the question I ask them is, "Do you have a following? Will your name and fame bring customers to the retailer, customers who will buy enough of your new perfume from the retailer to make him want to stock it?"

That's the rub. The retailer would be happy to offer your perfume, even if he has never heard of it or of you, IF he can be assured profitable sales.

Can you make that guarantee to a large retailer?

Aside from lack of name and fame, one problem that faces the aspiring-to-national-distribution newbie perfume marketer is lack of money. When people tell me that they have $20,000 or $200,000 to invest in their new perfume, I have to explain (and I don't think they believe me!) that these sums of money can be more than enough to launch a new perfume (business) ONLY if you are planning to introduce your perfume into a limited, targeted market where your name and fame already have some credibility.

Selling to your followers, fan club, extended circle of friends and acquaintances, social network, etc. is very different than trying to sell to strangers.

I sometimes want to cry when I'm approached by someone who really does have enough money to start a profitable business marketing their own perfume but, instead of targeting obvious and profitable markets, they are blinded by dreams of instant riches and can't be bothered with "small (profitable!) potatoes" because it will only distract them from their higher calling.

If you want to succeed in selling your own perfume you have to target a market, build a relationship with that market, and tailor your product to the tastes of that market.

Then you have to keep strengthening your relationship with that market and encouraging that market to expand, either in the amount of money individuals are spending with you or in the number of people who are drawn in to your social group -- or both.

None of this is to suggest that you should not aspire to vast sales and great personal fortune. What I would warn is that those who have achieved vast sales in the perfume business ALL started form a small -- sometimes very small -- customer base.

But it was from their success in selling to this small base and the lessons they learned by working on a small scale that allowed them to expand over time and develop grand international enterprises.

If you can name me one exception to this rule I would be happy to check it out. But, in the entire history of perfume, I doubt that you would find a single exception.

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