Brands and celebrities grow Elizabeth Arden's sales

- Last updated on GMT

Related tags: Elizabeth arden, Retailing, Britney spears

Sales of leading brands to mass retailers and the use of big stars
such as Elizabeth Taylor, Catherine Zeta-Jones and Britney Spears
in its advertising campaigns helped boost Elizabeth Arden's sales,
though operating loss was down in the second quarter.

The global fragrance and beauty products company reported increased net sales for the five-month period - the company recently changed its fiscal year end from 31 January to 30 June - up 9 per cent to $222.784 million. However, the operating loss also increased by 11 per cent to $29.083 million.

The company suggested that the sale of its prestigious brands to a wider audience is a key reason for this growth in sales.

"Our leading prestige products are increasingly being sold in mass retail outlets,"​, said E. Scott Beattie, chairman and CEO of Elizabeth Arden.

He explained that in 2000, prestige fragrances represented 39 percent of total fragrance sales in the mass retail market, whereas in 2003 this percentage increased to 51 percent.

"We have continued to develop the prestige category for mass retailers and during the year added many new and innovative programs"​, said Scott Beattie.

The company has also attempted to promote its products through costly advertising campaigns.

In the beginning of this year Elizabeth Arden filmed its first television commercial. The print and television advertising for the Provocative Woman fragrance featured Elizabeth Arden's global spokesperson Catherine Zeta-Jones and had the seductive tagline, "Men will melt."​ The company announced that early results for this brand had been very positive.

The company also recently signed an exclusive global licensing agreement with Britney Spears, the internationally acclaimed music star, to develop a line of fragrances and other beauty products that will allow the company to target a younger consumer. Curious by Britney Spears, her first fragrance will debut in September 2004. The Spears license terminates in December 2009, and is renewable by Elizabeth Arden, at its sole option, for a 5-year term.

The company plans to increase its advertising activities again in fiscal 2005. "Both new fragrances will be further supported with heavy print and television advertising during the upcoming holiday season"​, said Scott Beattie.

Despite the loss during the period, the company believes its strategy will pay off in near future.

"Our accomplishments and initiatives in fiscal 2004 have positioned us for growth in sales and profitability for fiscal 2005 and the years ahead. We are very excited about our upcoming product launches, and by working closely with our vendor partners, we plan to continue to expand sales of the prestige fragrance category at retail outlets"​, said E. Scott Beattie.

Elizabeth Arden distributes approximately 50 own and licensed fragrance brands, and over 250 fragrances under brands manufactured by others, principally to mass retailers primarily in the US through distribution and other purchasing agreements.

Related topics: Business & Financial, Fragrance

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