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Scents and Sensibility: an interview with Clarins Group President Joel Palix
The president of Clarins Fragrance Group, Joel Palix, talks to Atique Naqvi about the business of perfumes and the challenges the industry faces globally and in the region.
September 3, 2011 4:17 by Atique Naqvi
In 2008 the Courtin-Clarins family bought out minority shareholders of Clarins SA. How things have changed. It was a big decision and the timing was very interesting. And Joel Palix shares some of the colourful world of family-owned businesses.
What plans does Clarins have for the GCC and wider Middle East Region?
The Middle East is one of the very few regions where we have a balanced business between skincare and fragrances. This region is very important for fragrances, as historically the Middle East is known for perfumes and people here have been using fragrances for a long time.
In general, we have seen a very healthy development of our brands in this region. Our biggest brand has been Thierry Mugler – a stellar brand worldwide. In the 1990s Mugler’s Angel fragrance was very successful and in 2005 we came out with Alien. This is a pillar of our business here. We have introduced a specific fragrance for the Middle
East named Miroir des Voluptes.
What has been your formula for success in this region? And which fragrances have been your strong suit – Western or Oriental?
We have been lucky in that sense as Thierry Mugler perfumes are strong fragrances by Western standards. In this region, people like to experiment, they want to be different and they have a good knowledge of fragrances. We are offering the Miroir de in other markets around the world. Although Miroir des Voluptes is a very Middle Eastern fragrance, we are selling it around the world.
Do you see this as a trend that other perfumeries will follow, introducing products that are specific to this region?
We have seen other brands following suit, but we were the first ones to do it. This is definitely a trend and it complements our existing portfolio. The majority of other brands are doing it. Overall the global brands are localising some 10 to 15 percent of their products. In Asia, we have some specific fragrances. However, most of the business comes from the globalised fragrances.
How do you identify a fragrance with a region?
Well, it is based on culture. In Asia, especially in Japan, the tradition is not to impose your fragrance on others, actually it is perceived as bad taste and only geisha in Japan could use a little strong perfume, so when we are launching something there, the fragrance has to be very subtle, so oriental fragrances will not work in Japan, where people like lighter, fruitier and fresh fragrances. Oudh-based fragrances are very much liked in the Middle East.
Let’s talk profits. How was 2010 compared with 2009?
We have had an increase of about 20 percent in our worldwide business – in terms of sales. Our perfume division is growing very fast – much above the market trend. We introduced a new fragrance, with the oriental juice, with the jewelry brand David Yurman. We first launched it in America and when it was very successful we decided to bring it to the Middle East. This region has been the second-most successful market after the United States for this particular brand. We have developed other brands such as Azzaro, and we have launched Swarovski in this region.
What kind of trends have you witnessed in the market lately?
In 2009 the market went down by five percent, which was very new to our industry. It was mostly due to de-stocking by the retailers. The consumption was actually flat, but the distributors were inventory wary and careful with cash management.
How do you see 2011?
Forecasting is very difficult these days as the world is changing very fast, but so far so good. We have seen business picking up, the US consumption is increasing again and most of Europe is looking healthy. Travel retail is booming and the Middle East is growing, so is Asia. For the moment it seems everything is well and if we continue like that I think we’re going to have a really good year. For our business and brands, we expect business to be as good as it was in 2010. I think with perfume business, things are pretty stable. We do not come into the category of products that are affected much by the outside circumstances.
How much share does the Middle East market account for at Clarins and which is your biggest market?
The Middle East market, on a wholesale level, is about five percent of our global market. France is our biggest market, accounting for 20 to 25 percent of our sales worldwide. At the moment we see a very high growth in Latin America, driven by Brazil due to the sudden upsurge in the upper middle class. Some Asian markets and the Middle East are showing good prospects.
In Clarin’s portfolio, most of the products are licensed. What is the logic behind this? Is it because Clarins started with its own range of products?
It’s a matter of circumstances for us. We signed a licensed pact with the owners of Thierry Mugler and then we bought the brand. Initially we had both fashion and fragrances from Mugler, but then we decided to stick with fragrances. The benefit of having your own brand is that you can build your business around it. But now we have decided to re-launch…
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