Fragrance Sales Getting Weak

By on July 25th, 2013

fsgwSoftness in fragrance advertising crimped results at fashion and lifestyle magazines in the first half. Fashion pages contributed to many of the gains, but publishing executives said sluggish beauty business at retail kept the numbers down.

They are much more bullish about the second half, when a number of fragrance launches — notably Ralph Lauren’s Romance, Calvin Klein’s Contraction for Men, Estee Lauder’s Dazzling and Lancome’s O Oui — are expected to produce better figures.

As for the first half, In Style, Vanity Fair, Architectural Digest, Conde Nast House & Garden and W all enjoyed double-digit gains; Vogue and Cosmopolitan reported slight gains, and Harper’s Bazaar, Allure, Elle and Marie Claire suffered declines, according to Media Industry Newsletter.

While the fashion business contributed to many of the gains, publishers said there was continued softness in the beauty business and a drop in fragrance advertising.

“Beauty is down for everyone due to the softness at retail,” said Ronald A. Galotti, publisher of Vogue, the fashion leader. “The advertising we’ve seen is reflective of that.”

Fashion, on the other hand, was up 3 percent, which Galotti attributed to both European and American lines.

“I think the business is going to get tougher,” he said. “I think it’s a continuation of a difficult retail business.”

He did note, however, that luxury-goods business is “holding its own.”

Galotti believes the second half will be tough.

“We had our single best year in our history last year,” he said. “We’ll have a fabulous year when all’s said and done, but will it be easy? It’ll be a fight. The next four to six weeks will be a very telling part of the story. We close September in July. At this stage of the game, we’ll be relatively strong in September.” (See related story on Vogue’s market share plan, this page.)

The beauty downturn particularly hurt Allure, which does 70 percent of its business in the category.

rc“It wasn’t great,” said publisher Alexandra Golinkin, who attributed the decline to several accounts that ran fewer ads — or no ads — in the half. “Renaissance Cosmetics, while regrouping, was dark; Revlon’s not advertising fragrances anymore; Donna Karan sold her beauty company to Lauder, and they were totally dark for six months, and Calvin Klein Cosmetics, which is launching in the second half, was very quiet in the first half.”

However, Golinkin noted, “June, July and August are up, and we’re looking at a very strong second half.” She said she’s running an exclusive Nordstrom “magalog” and expects to carry a lot of fragrance launch business.

As for fashion, Golinkin said she lost the Tommy Hilfiger fashion business and was cut back by Ralph Lauren, but made up that business with advertisers such as Bisou-Bisou, Chloe, DuPont Lycra, Louis Feraud, Trussardi and Dayton Hudson.

Vanity Fair just completed the best first half in its history, said publisher Mitchell Fox. From January to July, fashion pages were up 14 percent, while beauty pages were off 19 percent. The automotive, jewelry and watch, retail, technology and entertainment categories were all up.

As for the second half, Fox said: “We’re cautiously optimistic as the economy continues to be strong.”

Ann Jackson, publisher of In Style, which reported a 40.9 percent jump in ad pages for the first half, said the biggest gains were in its fashion, beauty and automotive categories. Among the new advertisers during the first half were Baume & Mercier, Ralph Lauren Home, Tag Heuer, Burberrys, Bobbi Brown, Shiseido and Gucci Envy.

“The second half looks strong,” said Jackson. “While some [prestige] businesses have been hurt by Asia, what we’re seeing is they’re spending more money in the U.S. market.”

W was up 15.2 percent in ad pages in the half and had a 27.6 percent increase in beauty and a 4 percent gain in fashion, according to Stephanie George, senior vice president and group publisher.

George attributed some of the beauty increase to the Pampered Woman section that ran in April.

“It kicked off the second quarter with a bang and attracted new advertisers such as Annick Goutal and Stila Cosmetics,” said George.

In the first half, said George, W brought in $1 million in non-endemic business from liquor, credit-card and electronics advertisers.

Another growing category is shopping destinations such as South Coast Plaza in Costa Mesa, Calif., and The Americana in Manhasset, N.Y.

“Things are looking excellent, particularly in August and September,” George said. “August will be very strong because of W’s Black Book, which is the `Best of the Best.’ It’s been well received by the ad community. It will generate $1 million in incremental business.”

George said she also expects an increase in September’s fashion issue. For the year, George expects ad pages to be ahead 18 to 20 percent.

From January through May, Cosmopolitan’s fashion business increased 48 percent, while beauty was up 7 percent, said Donna Kalajian, publisher. Kalajian attributed the jump in fashion to new business, as well as more pages from such existing advertisers as Gap, Ralph Lauren and Esprit.

Carl Portale, senior vice president, publisher of Elle, attributed his magazine’s first-half decline to “being up against three years of great numbers.” Portale expects to be even for the year.

“We’re very bullish about the remainder of the year and going into 1999,” he said.

Jeannette Chang, publisher of Harper’s Bazaar, said the prestige beauty category, the core of the magazine’s beauty business, has been languishing.

“Most of the growth in this beauty category has been from mass beauty advertisers, which is not the core of Bazaar’s beauty advertising mix,” said Chang. However, she predicts increased prestige beauty business for fall due to a number of upcoming fragrance launches.

Chang said the magazine has decided to concentrate on the high end of the market and doesn’t want to go after mass advertisers, despite published reports that the magazine wanted to broaden its ad base. She cited gains in the first half in U.S. designer apparel, European apparel and fine jewelry and watches. Bazaar’s new non-endemic business includes Evian, American Express, Lexus, General Motors Corp., Grand Marnier, Chopard and Christolfe.

According to Mary Berner, publisher of Glamour, ad pages are up 6.9 percent, with the fashion category ahead 8 percent. Among the new fashion advertisers to Glamour were Adrienne Vittadini, Anne Klein, BCBG and Kasper.

“Beauty was slightly down,” Berner said, attributing that to fewer fragrance launches. The May issue was its biggest issue in Glamour’s history, with 231 ad pages.

Berner said she’s encouraged by new fashion advertisers such as Jones New York and Danskin coming into the marketplace this fall.

Nina Lawrence, who became publisher of Mademoiselle in March, said the fashion and beauty businesses were both flat in the first half, but added, “We’re holding our share.”

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