Selling strategies ease Stick Scents entrée into mass

Beauty Bureau actually had made its first forays into the mass channel in the year before attending the National Association of Chain Drug Stores’ inaugural Successful Selling conference in 2007—the company made its mass market debut at NACDS Marketplace 2006. “Our prior experience had just been going to the gift-market shows,” said Laura Benz, executive vice president of business development for Beauty Bureau. “While we were very well received, some things we learned the hard way.” “Successful Selling really taught us how to differentiate our brand from other brands.” The show also gives new companies a feel for how to appeal to the large chain buyers—including expected advertising support, co-op fees, slotting and an assessment of what capital is necessary for a successful launch.

Following that Successful Selling show, Marketplace 2007 was a much more productive experience, Benz said. “I was more prepared to have my advertising and marketing for the product line presented to the buyers,” she said. “Because I [better] understood the value of the real estate I’d be taking up in the warehouse, as well as on the shelf.”

Knowing your customer—the retailer, as well as the consumer—also helps with the sell-through, Benz said. For instance, knowing what percentage general merchandise (in the case of Beauty Bureau) contributes to the overall retail revenue stream can help better position the product for that particular retailer, not to mention better manage promotional spends on a regional basis.

For new-to-the-channel vendors, Benz suggested test-marketing as an ideal way to get your toe into the water. “Don’t go for all 1,600 stores,” she said. “Your exposure is limited when you’re doing a test. If you do well, you can move forward more confidently.”

Beauty Bureau’s innovation was the introduction of a luxury product—a reed air-freshener diffuser—which is part of the trend toward greener products and priced for the mass market. And to make its product offering even more attractive to mass merchants, Beauty Bureau made exclusive fragrances available to retailers as part of its negotiations.

Maryann Mihalopoulos, who founded Beauty Bureau, started her business in 2001 after visiting Greece. According to Mihalopoulos, the air fragrance market was flooded with candles, incense and sprays that could be unsafe and/or toxic, suggesting that the greener, more decorative reed diffusers, to be branded Xela Aromasticks for the specialty channel, might be able to enter the market.

Originally positioned for luxury and specialty retailers, such as Dillard’s and beauty.com, Beauty Bureau later developed Stick Scents, the mass market equivalent, and cut production costs by using less-expensive packaging. Stick Scents launched with a suggested retail price point of $20 for an 8-ounce reed diffuser. The specialty market equivalent prices for $40, Benz said. The difference between the two brands is most apparent in the packaging, Benz noted. “Xela is not packaged for mass—it has more of an open [facing], so if it were to be dropped, it could actually break. Stick Scents is in a clear plastic tube,” Benz said, which is more amenable to the rigors of a mass market supply chain.

There is also a difference in the formulation, Benz added. Xela features more expensive aromatherapy oils versus fragrance oils in the Stick Scents.