February 28, 2001, 12:00 AM

DigiScents builds a business model on trying to make web sites come up smelling like a rose

(Page 2 of 2)

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.”


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