Flare Fragrances Case Essay

664 Words Apr 22nd, 2014 3 Pages
Flare Fragrances Company
Case

Problem Flare Fragrances is experiencing declining sales growth. Arlmont Associates suggested two options that Flare Fragrance can do to increase sales growth. The first option is to increase efforts in the drug store channel. The second option is to introduce a new perfume brand. Whatever decision they make it will need to deliver $7.5 million in revenue for 2009 and reverse their declining sales growth trend.

Analysis

The first option to look at is to increase efforts in the drug store channel for the existing Flare Fragrances brands. The total market sales from 2007 in the drug store channel was only about 17% (Exhibit 1). With that being said this channel is not as profitable as department
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The introduction of beauty experts, as explained above will hopefully increase sales in this channel and ultimately increase sales of Savvy and other Flare Fragrances products.
The use of a celebrity endorsement would be extremely beneficial to the introduction of Savvy since the target market is influenced by word of mouth and prefer exclusivity. The use of a celebrity would also make it easier to come up with a new theme gear towards the target markets of women age 18-34. As for the three media plans for Savvy introduction we would only want to do Plan 2 or Plan 3 since we need to reach our goal of $7.5 million in 2009. If we use the estimated sales return from money spent on advertising by our competitor Plan 2 would generate just enough revenue to reach that mark and Plan 3 would exceed it (Exhibit 3). If we were to use a celebrity endorsement we would want to go with Plan 3 because it will generate the most sales revenue compared to Plan 2.

Recommendation Flare Fragrances should introduce Savvy as a new brand not under the Loveliest umbrella. This way they can be seen as a completely new scent and attract those younger women age 18-34 who want a prestige brand, exclusivity, and are willing to try a new scent. This will also help the Loveliest brand by not diluting it too much with another fragrance like Natural which is aimed at a younger demographic. In order to create hype they should use a