Web retailers that sell perfume and other fragrances are finding that price sensitivity, moving carefully into new lines of merchandising and expanding relationships with manufacturers are paramount to keeping e-commerce sales climbing.
As a web retailer, FragranceNet.com carries more than 8,000 SKUs, including 350 different fragrances. But rather than expand too fast into other areas, president Jason Apfel says the company is concentrating on building out certain parts of its site such as its salon line of merchandise, which includes hair care. Another key thrust of the retailer’s 2005 Internet marketing and merchandising plan is competing even more aggressively on price, says Apfel. FragranceNet had 2004 web sales of $21 million, which is up 60% over $13 million in 2003. Shoppers spend on average $60 each purchase.
Key to merchandising is offering products at a competitive price, which FragranceNet accomplishes by selling some items at up to 70% off retail. “This is a very personal shopping niche where once customers find a brand they like they look for who has it in stock and at the best price,” says Apfel. “We intend to offer the best price.”
Online fragrance retailers say their shoppers are brand-conscious and price-sensitive. Scentiments.com, for instance, attributes a 27% growth in e-commerce sales from $6.5 million in 2003 to $8.9 million in 2004 to ongoing relationships with fragrance makers such as Carolina Herrera and Yves Saint Laurent and keeping prices low.
“Shoppers are looking for low prices and who has the fragrance in stock they want,” says Scentiments.com CEO Howard Wyner. “We get repeat business because we have very solid relationships with the fragrance companies that keep our available inventory up to date.”