The Online Perfume Industry

1
The Online Perfume Industry

• Chris Butsko
• Srinath Nagarajan
• Yuenman (Priscilla) Pang

2
Major Players in Online Perfume Industry

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

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A Sample Front Page
4
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

5
A Sample Signup Page
6
A Sample Perfume Store
7
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 todays
  fashion-conscious, value-oriented consumers.
  (Source Perfumania)

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Online Perfume Industry

• Who are the customers?
• International customers FragranceNet offers
  shipping worldwide

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Online Perfume Industry

• How do they attract customers?
• Affiliation Program (FragranceNet, LaParfumerie)
• Great Discounts (All)
• Low price guarantee, beat competitors 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)

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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

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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

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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 competitors price by 5
  (FragranceNet)

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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, ISPs, Online Communities

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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