DigiScents builds a business model on trying to make web sites come up smelling like a rose
By Andrea McKenna Findlay
What do web pages smell like? To DigiScents Inc. and its investors, they smell like money.
If Dexster Smith has his way, they also could smell sweet, or musky or any other adjective to describe an aroma, odor, smell, scent or fragrance. Smith is president of DigiScents, which says its technology can produce thousands of different scents, triggered by software which commands a scent cartridge with 64 basic smells to mix compounds, then send the resulting aroma wafting into a computer user’s room.
Web users already see exciting color graphics and streaming video, and can hear live customer service and background music, so why, Smith wonders, shouldn’t smell be among their experiences?
Some major fragrance and flavor companies, as well as video game, e-commerce and web developers agree. They hope Oakland, Calif.-based DigiScents’ digital smell synthesizer and software applications that transmit scents will make their presence on the web smell like profit.
Nosy customers
DigiScents, founded by Smith and Joel Bellenson in 1999, is aiming to crack open the market for scent sensory perception—commonly known as smell—for web usage. This won’t be the first time the two have broken down something as nebulous as smell into component parts. Their first company was Double Twist, which developed software that helped scientists crack the human genome DNA code. With its double-meaning name iSmell technology, the company plans to distribute peripheral devices that can transmit scents triggered from the web.
The smells in the cartridge last up to three months. Companies that are partnering with DigiScents believe the company’s scented web technology will become as common to end users as soundcards that allow consumers to hear streaming music and see streaming video over the Internet.
Digiscents has a number of developments that could propel it onto the web scene as well as into other areas, such as movie theaters and video game consoles. The argument for web-enabling scent is compelling: Smell is the strongest of the five senses, evoking an emotional response that manufacturers and sellers of fragrance, candy, food, flowers, greeting cards and many more products are eager to cash in on. “The broad range of applications gets people beyond their disbelief that this technology will work,” Smith says. “Selling perfume online is one of the smaller markets. Food is the larger market for this technology and household products such as lotions, soaps and cleaners are an even bigger consumer market.”
Smith argues that consumers are ready to embrace scent technology because there is increased interest in scent throughout the population, as evidenced by such phenomena as aromatherapy. “All you have to do is look at the rise in popularity of such stores that make their products based on scent such as Bath and Body Works and The Body Shop,” he says. Other areas DigiScents hopes to break into include entertainment and advertising. The company recently hired former Sony and Sega new technology veteran Jonathan Seidenfeld as senior director of business development, games and entertainment.
Digiscents plans to make its profit from not only selling its peripheral iSmell device, which will plug into computers to receive and emit scents from the web, but also through licensing agreements from companies that want to apply the digital scenting technology to their businesses.
DigiScents has had a lot of promising new developments in recent months that are bolstering its plan for bringing scent to the Internet. The company has raised $20 million in private financing. And two major flavor and perfume companies—Switzerland-based Givaudan and Netherlands-based Quest International—have invested in DigiScents. “These companies have a goal of raising the visibility of the sense of smell. Allowing people to use it as a mechanism of communication is a way to do that,” Smith says.
Quest, a leading fragrance, flavor and food ingredients manufacturer, says such technology is risky because it is new, high-tech and will need to be accepted by consumers. But it wanted to be involved with DigiScents to determine where the technology will go. “We are always looking for how our marketing will evolve,” a spokesperson says, noting that technology sharing is another key point of the deal. “DigiScents has a hugely ambitious project in odor reception to understand which molecules engage olfactory receptors and to essentially come up with an olfactory code, like a DNA code. It could be a hugely powerful asset to find that code.”
Givaudan, another leading fragrance and flavor company that does research, development, creation and manufacturing, also believes the application of scent on the Internet can expand its product distribution markets. “We are in a business with very limited growth possibilities,” a spokesperson says. “One possibility is to grab market share from a competitor and another is to look for new applications such as DigiScents’ technology that will do things with scent and flavor that have never been done before.”
Staying out in front
Another major coup for DigiScents is its deal with consumer goods giant Procter & Gamble, which markets more than 300 brands to nearly 5 billion consumers in 140 countries. Popular brands include Crest toothpaste, Tide laundry detergent, Oil of Olay cleansers and lotions and Pringles potato chips. Cincinnati-based P&G, which invests nearly $2 billion per year to develop and improve its products, formed a strategic research alliance with Digi-Scents in May 2000. The alliance will provide DigiScents with access to a range of proprietary P&G consumer research techniques and methodologies to help DigiSents better understand consumer perception and response and further evaluate the market potential for digital scent applications. P&G declines to comment on the deal but the company issued a statement that said it believes the deal with DigiScents will help it stay in the forefront of emerging Internet technology.
Smith says P&G, as well as online b2b candy company eCandy, will be part of a broad-based research program in 2001. “Smell is becoming a very important aspect of consumer marketing and the Internet is a way for large companies to build relationships with customers to find out what they are looking for,” Smith says. “There are trends that these companies would like to pick up on immediately and having smell is another dimension of their communication with consumers.”
With such big names behind it, it appears that bringing DigiScents’ digital scent technology to e-commerce could be a sure thing. But even though the prospects for cracking the scent code are compelling, just like anything else that depends on consumer usage for success, consumers have to try it and have easy or free access to it before it they adopt it.
DigiScents’ plans to place iSmell devices into the consumer market are twofold: The company has deals to get the software to consumers on the Internet and is signing deals to get the receiver devices into consumer electronics stores and households as part of package deals with computer stores and/or manufacturers.
RealPlayer, which announced a deal with DigiScents in October 1999, will distribute DigiScents’ ScentStream software with its RealPlayer web video download software that is used by 170 million consumers. Consumers who buy an iSmell device—a plug-and-play unit that looks like a shark-fin-shaped mouse expected to hit retail stores by late 2001 for under $200—can access the DigiScents software through RealPlayer by choosing the feature when updating their RealPlayer software online.
The DigiScents software transmits scent combinations to the peripheral iSmell device. When users come across web videos that use RealPlayer they are often asked if they want to automatically update the software on their hard drive. The same will happen when users encounter a web site that is Digiscents-enabled. Although the deal does not automatically connect DigiScents’ software with RealPlayer users, the potential for consumers to access it through RealPlayer once the iSmell device is on the market is a solid distribution channel. “RealPlayer is the dominant company in streaming audio/video and they saw the opportunity to help us become another dimension to the web experience,” says Smith.
DigiScents plans to cross promote the iSmell device and its uses in conjunction with retail partners and consumer products companies. Although no marketing plans are set, the company expects to use print, radio and TV.
Currently DigiScents is working to make deals with computer companies to add the iSmell device as a component or bundled into the computer system, Smith says. And DigiScents believes that the interest will eventually drive the demand. In fact, consumer tests have been encouraging. “The consumer response so far has been phenomenal,” Smith says. “I don’t think it’s going to be a stretch that it’s going to be a peripheral device. People will want to try it out.”
The gateway to smell
As part of its distribution plan, DigiScents is building the first scent-enabled web portal, called Snortal, that will allow visitors to send scented e-mail, design and register their own scents and create and share scent tracks to go along with music or movies. The web site will launch at the same time as iSmell device later this year. The company also expects to allow visitors to purchase iSmell devices and scent cartridges through the Snortal web site.
Despite catchy names for its technology, some market observers question the viability of such a plan. While supporters quote anecdotes about the triumphant additions of sound in movies, the adoption of ATMs and the rapid spread of digital music, there are plenty of failed technologies that may have made sense but which consumers did not adopt, such as beta video recorders, smart cards and screen phones. “What is the person who uses this device getting apart from the wow factor and that it’s supposed to be a better advertising experience?” asks David L. Taylor, senior vice president of Operon Partners LLC, Stamford, Conn. “It’s not clear what the marketing pitch is for being able to smell things on the Internet.” He notes that, while anything can be done on the Internet, users may not adopt it fast enough for investors in the company to recoup costs of promoting such a technology.
But the DigiScents and its partners believe the power of smell will overcome the skeptics’ view of the technology’s applications. “Scents have dominant buying characteristics with consumers,” Smith says. He points out that DigiScents’ big-name partners know that allowing consumers to access smells over the Internet is a huge market opportunity. “We’ve got the top companies in the world as partners to make this happen.”
andrea@verticalwebmedia.com 
|
