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The answer to these questions may have great implications for the extravagance industry. As the world’s luxury makers struggle to make a profit in trend, they’re looking to boost sales and profitability by expanding into beauty. According to a Mckinsey record, fragrance and cosmetics are a “flagship” organization that can generate growth in many other categories for extravagance brands.
But the method is not without hazards. The packed type can be difficult to crack. And the divisions of a brand often do n’t speak to each other, making it difficult to create integrated marketing and communications campaigns.
The circumstance of Burberry, which took its charm company in- house under erstwhile Ceo Angela Ahrendts in 2013, offers a cautionary tale. The decision to terminate the agency’s licensing contract with Interparfums Sa, which held the certificate for its Montblanc and Van Cleef & Arpels perfume, sent shares of the company tumbling 9.4 pct on Sept. 6. Kering’s buy of Creed at a 14- days profits two in October also made investors sit up and take notice.
