Finding Your Own Niche (It's going to be small!)

    If I had the key to helping perfume makers get their perfumes into Macy's and Walmart, I could make a lot of money very quickly. What I try to get people to understand is that the "problem" is not that Macy's or Walmart doesn't want your perfume. The problem is that Macy's and Walmart know that in their stores, your perfumes will not make sales. Even if a few bottles were sold (which might be exciting for you!) the loss the stores would take by giving you valuable retail space, that could be making money for them with someone else's product, would simply make no sense to them.

    Add to that your cost of preparing your product for sale to one of the large retailers. Have you looked into their "Vendor Requirements" which can be found at their websites. Most large retailers publish their requirements for vendors and if you're just making perfume without some serious money, serious promotion, and serious business management behind you, you simply won't qualify to be accepted as a vendor by a large retailer. It's nothing personal. It's just business.

    So that do you do to make money with your perfume?

Think business!

    Your artistic side goes into creating your fragrance. Then your business side has to take over to develop a way to sell it.

    Business means profit and loss. When you spend more than you take in, you've got a loss. If you were trying to prepare your perfume for sale at Macy's and you didn't have a following like Justin Bieber, you would take a loss -- a big one.

    But, using your business head, think out ways you could sell your perfume that can be worked within your realistic resources.

    Look at a simple element -- a UPC (universal product code). Most larger retailers and many mid-size ones will expect you to have a UPC on your box. Box? Think about it. If your operation is really small, just producing a box can be a big investment. Then the UPC. To get that you have to spend money. And remember, each individual product you sell -- say three fragrances -- has to have its own UPC. The cost begins to add up.

    But there are ways to sell your perfume without a UPC, and even without a box. If your perfume is good, and it looks nice just in its bottle, you may find one or more small local shops that will take it. Then it's up to YOU to make sure you're doing all you can to get people to BUY your fragrance in these stores.

    Look at it this way. Local stores will often agree to display a product by a local person. But to display it isn't the same as making sales. To make sales happen YOU have to DO something. This is the moment that decides whether you have the start of a business or whether to hang it up.  If you can't make sales locally, where people know you, don't expect larger stores somewhere else to be interested in your perfume.

    There are other ways to get started. I've written about many of them in  61 Ways To Sell Your Own Perfume! But if you seriously want to develop a business selling your own perfume, you simply must fight to make SALES -- to the public, not the stores -- and start by doing it on a small, affordable scale where you really do stand a chance to make money with a stripped down product (perfume bottled but not boxed or UPC's) and a very modest budget for your promotional campaign.

    If you can succeed at this, the sky's the limit.

   

   

Market Research: Does It Matter?

If you want to sell your own perfume you have to look at it as a business. If this is a new business for you, you have to do your homework before you invest. When someone buys a pizza parlour, a bowling alley, or a health club they look into the situation before they sign the papers. They consider the neighborhood, the customer base, whether the existing business is actively growing or declining, and whether the business is likely to produce enough revenue to cover expenses and still yield a profit.

Perfume is no different.

To make sales you need customers. Before you invest you need to assure yourself that you will have enough customers to make your project profitable. You do this by preparing a business plan and before you can develop a realistic business plan you need to conduct some market research.

The most important questions are, "Are there people who will buy my perfume?" and "How will I go about selling it to them?"

In short, you need to know who your customers will be and how you will make sales to them.

This cannot be vague. This cannot be wishful thinking. You have to have a realistic, practical, way to make sales or you cannot be in the perfume business.

Anyone can make a perfume to sell but not everyone can make sales.

What is your plan?

 When you first thought of launching a perfume, how did you plan to sell it? Did you plan to do the selling yourself or were you banking on turning sales over to some other organization (Walmart? Macy's?) that you thought would do the selling for you? If it's the second case, have you looked into the vendor requirements for these stores? These requirements are published on the stores' websites. Reading them will give you some sense of the steep climb you will have and the money and management skills that will be required to develop a relationship with a major chain.

More realistically, if you want to be in the perfume business, you'll find a way to make sales -- yourself -- by carving out some sort of niche for yourself.  (Read "61 Basic Strategies For Selling Your Own Perfume" for ideas.)

If you are approaching this business in a practical way, you'll be working to make a profit on a small scale initially rather than getting in way over your head and taking a colossal loss.

If starting small doesn't appeal to you, you might not be a good candidate for owning your own business.

Market Research For You

I've started a series of articles on market research on a scale anyone can undertake. This series appears on my other blog, "Learning To Make Perfume." It seems to apply to both making and marketing perfume as, if you're trying to make perfume to make money, you need to answer a few basic questions first. These answers can be fetched through some very simple, inexpensive, market research. They are essential.

Learning from the Leaders: Perfume, the t-shirt of today

 There was once a crop of t-shirts that bore the message "My parents went to [Acapulco, Cape Cod, Orlando, San Antonio, or wherever] and all they bought me was this t-shirt."

T-shirts became the classic tourist gift store item because (1) they were practical (if a bit overpriced) and (2) they established that you (or your parents!) had the money and the good taste to vacation in some desirable destination.

Bands got in the act. You "supported" your favorite band by wearing their t-shirt. Who, after spending a fortune to see Bieber or Minaj, would not spend a few bucks more to "support" them by buying and wearing a t-shirt that commemorated the event?

Unprinted t-shirts are cheap. Printing a message on a t-shirt is simple and inexpensive. So t-shirts became standard "band merch" sold by every Saturday night bar band at their gigs.

Then came perfume. In case you've missed this, marketers have gone beyond the generic "celebrity perfume" category and discovered that the real money -- the huge profits -- lie in "music perfume." Forget athletes, forget authors, forget designers -- focus on singers. Why? Because they are the ones who have the huge numbers of supportive fans -- fans who buy their expensive concert tickets, fans who buy their (overpriced?) t-shirts, fans who buy their ... perfume!

Justin Bieber -- he's a guy, right? -- makes $3 million in perfume sales to women in less than a month and goes on to sell $39 million worth of WOMEN'S perfume in just over a year -- toe to toe with Taylor Swift and her fragrance. The 2012 fall/Christmas selling season is going to see a LOT of dollars from music perfume.

How does this relate to you?

A singer or band doesn't have to be A-List to have their own t-shirts. Every serious band and singer has t-shirts to sell at gigs, along with their CD's. Word has it that some groups with no more than a local or regional following are making more off their t-shirts than they make from either performances or CD sales.

Now what about perfume?

If you are reading this it's likely that you are interested in marketing perfume -- your perfume. But it's also likely that if you look around your city OR SMALL TOWN you'll find at least a dozen singers and bands that have more supportive followers than you have. (Dare I ask, do you HAVE any following at all?)

If you don't believe what I'm saying, start hanging out and observe the action. Live groups are playing. Are t-shirts being sold? Is money changing hands? How often is each band getting gigs? How far do they travel to get bookings? Are they self-managed or do they have a manager? Or an agent? Do they have their own website? Could they sell perfume? How much perfume could they sell?

Now -- a question for you. How big do you want YOUR NAME to be on the perfume you sell? Are you willing to share SOME of that billboard space (your tiny label) with a singer or band? Would you -- if you could make more money by doing it -- give ALL the credit for the perfume to a singer or band?

HINT: The more the fragrance appears to "belong" to the singer or band, the more sales will be made, for you.

Issues remaining --

(1) Producing your music fragrance in the right quantity for the singer or band's "market" so you don't overproduce (and lose money on unsold bottles) or under produce (and lose potential sales)

(2) Being able to produce your fragrance in relatively small quantities at a low enough cost-per-bottle that will allow the fragrance to be sold at a reasonable cost to fans and still yield a generous profit for both you and the singer or band.

I've written repeatedly on these last two issues elsewhere, in eBooks and our Club newsletter so I won't repeat myself on these two points here.

Can you put together a celebrity fragrance deal?

Let's just say you know someone who is a celebrity, perhaps not a very big celebrity (which may be good!) but at least a celebrity in your city or region or among your social media group. How would you like to put out a celebrity fragrance using this person as your celebrity?

There are a few things you'll need that you probably understand already. First you have to be able to produce a fragrance. You can learn how to do this on just about any scale by reading "Creating Your Own Perfume With A 1700 Percent Markup!"

Then you have to be able to market this fragrance. You can get some ideas on how to do this by reading "Basic Strategies For Selling Your Own Perfume!"

But what makes this project special is that you are going to do it in the name of this local celebrity you know or know of and this means you have to negotiate a deal with her or him or their agent or manager if they have one.

As you go over the deal in your head it probably looks something like this: "You give me your name, image and fame; I'll make up a fragrance and sell it in your name and we'll divide the profits." Simple.

Alas, if you've never seen egos collide you are about to. It will be ugly and it will probably happen before your have earned a penny. While you, the enterprising marketer, are going to do all the work, pay all the expenses and take all the risk, your celebrity suddenly gets millionaire visions and sees you hogging all that money while they are getting screwed. Explosion! It is time now for serious negotiations.

I have seen these explosions. They can be very surprising to any budding entrepreneur or promoter who thinks he or she is working on the basis of friendship. You wouldn't be anything else but perfectly ethical and honest. But surprise! Dreams of great wealth have a way of twisting otherwise level headed heads. It really is time now for serious negotiations.

Negotiations. Why? What?

Vigorous arms-length negotiations before you launch your promotion can save you endless future headaches. But what do you need to negotiate? There can't be too much to it ... or can there?

Let's look at a few issues. You're going to be doing almost all the work -- but you'll be using your celebrity's name and fame. You're doing it to make money for yourself but you know, or you should know, that once things get rolling your celebrity is going to be looking for money too. So how do you work that?

At one time some fairly well known celebrities could be hired -- for a fee -- to endorse a fragrance. Of course this involved what seemed at the time to be a fairly substantial fee, and it was guaranteed, up front, regardless of whether the marketer made money or not.

Today royalty agreements are more common. You negotiate a license with the celebrity or, in reality, with their managers and lawyers.

But what is this royalty? And is that all that needs to be negotiated?

In fact, setting a royalty rate and negotiating how it will be calculated and paid is a fine art in itself. In your case look at the complications. Suppose the royalty is on sales -- but you make some sales yourself, directly to consumers, and other sales to stores which then sell to consumers -- two different types of sales so are there going to be two different royalty rates?

And what about your expenses? Can they be deducted? What about stores that fail to pay you for the bottles you gave them? Can that loss be deducted?

What about a failed promotion? Does your celebrity now get nothing or is there a guarantee? And does the celebrity get any money up front? And is that a signing bonus or an advance on royalties which later must be earned? When are the payments to your celebrity due? How can he or she check on your accounting to make sure it is honest? What happens if one of you wants to get out of the deal? What happens if somebody sues you claiming they were harmed by your fragrance? Does your celebrity get dragged into a lawsuit, even though he or she had nothing to do with making the fragrance?

Negotiating a workable understanding -- a license -- is the heart of any celebrity fragrance deal. These deals are usually negotiated by lawyers but if you, on a small scale, want to wing it with a local celebrity, at least want to be aware of the important issues. And you want your celebrity (or her boyfriend, his girlfriend, or their manager) to be aware of what you are doing and to understand the implications. And you want to get it all down in writing, even if you're only writing up a simple letter of agreement.

My thoughts on this topic and some of the points I discovered while reviewing a major celebrity's license with an un-famous marketer led me to write up a simple introduction to this topic -- "Setting Up Your Own Celebrity Fragrance Deal: Introduction to the Basics" -- which you can purchase and download at my website.

Some truths about selling your perfume in retail stores

What do you really know about getting stores to take your perfume?

I wrote a little book a few weeks ago called A Method For Getting Boutique and Variety Store Owners To Take Your Perfume. What I wrote wasn't just a few random thoughts. This book was inspired by some very recent encounters with store owners. Let me elaborate.

Every time (or almost ever time) I come across a "make money selling your perfume" pitch, the writers (most of whom have never made or sold perfume!) suggest that you can make money by having your perfume in retail stores. After all, isn't that the way most perfume is sold? Actually it's a bit more complicated.

The distribution and sales of "brand name" fragrances is a far more complex business than first meets the eye. But a "general rule" would be that the "big names" are sold only though "big retailers." you won't find the really famous brands in small, independent stores or in small, local chains. The "big names" won't sell to them.

So it might seem that this creates an opportunity for you. But it's not so simple. Big retailers DISTRIBUTE name brand fragrances more than they "sell" them. The perfume sales that they make require the buyer to come into the store LOOKING for perfume. If their perfume sales had to depend on impulse buyers, perfume sales would take a big hit. In fact, perfume sales in retail stores are driven by multimillion dollar advertising campaigns paid for by the brand owners -- NOT the retail stores. (And often these campaigns themselves fail to sell the brand, although this is rarely admitted!)

So the first reality you -- with your own perfume -- have to face is that while seeing your perfume in a store might give you a great ego boost, it isn't any guarantee that you'll make money. The cold reality is that without promotion on your part, merely getting a store to display your perfume can easily result in zero sales. This becomes a big hit to your ego.

Now in this little book I just wrote, A Method For Getting Boutique and Variety Store Owners To Take Your Perfume -- which was inspired by recent and wonderfully vivid experience (that involved a perfume that was NOT one of my own!) -- is not about getting store owners to "take" your perfume so much as it is about how to work with store owners so that they become receptive to taking on your perfume with the honest intent of helping you sell it. And that's what you want.

The simple fact is that retail stores exist to make money. The kindest, nicest, friendliest, kindest to the environment, store owner still has his or her rent to pay, salaries and related benefits to pay, plus all sorts of administrative expenses. Quite likely this person is putting in long hours trying to "make it" with their store, which could be their entire livelihood.

The store owner might be kind enough to let you display your perfume for a few weeks (on consignment, meaning if it doesn't sell, you don't get any money) but unless the store owner is enthusiastic -- not about your perfume so much but about the money it can make for them -- you won't make money simply by having a few stores "take" your perfume.

Where you make your breakthrough is in developing a mutually profitable relationship with store owners. You do this by understanding their needs and what it takes to make sales in their particular stores. With this understanding you are better able to talk shop with store owners and develop a program that will make your perfume attractive enough to the store's customers that they will buy it.

It's not easy, but it's not impossible ... and it is essential if you are counting on selling your perfumes in stores. That new book again, A Method For Getting Boutique and Variety Store Owners To Take Your Perfume. If stores are your target, this book will help. (And don't blow off small stores when you're new at the game. They are your stepping stones to larger stores, and larger sales!)

It's all about the lists

Lists. The engine behind almost all promotions. Today email lists are in the spotlight thanks to hackers having broken into a major emailing facility and walked off with millions of email addresses. But street address lists are still a vital part of our economy. Ask any politician or charity -- or catalog marketer.

In the earliest years of the 20th century, before newspapers had become a cost effective mass advertising tool, fortunes were made by those who possessed the postal addresses of millions of American and Canadian heads of households.

Today, once again, I am thinking of lists -- A list -- one I don't yet have. I'm thinking of compiling a list of small, owner-operated, jewelery and gift boutiques that might be good prospects for a particular perfume. Let me explain.

Yesterday I received a bottle of a perfume I had ordered that is being marketed by a small company that caught my eye a few months ago when I was working on our Perfume Maker's Club newsletter. I don't want to mention its name here and I am not connected with the company but I will say that this perfume had a strong concept behind it. This is almost unheard of in fragrance marketing today. And the concept was reflected in the packaging. Visually it made a very strong impression with a clear message.

I knew the owner of a local jewelry shop that I thought might be a good fit for this perfume even though the shop has never sold perfume. I showed it to her and not only did the packaging get a very positive response, the perfume itself was judged to be excellent. When I explained that a small company was behind this perfume and a large order would not be necessary to get it for her shop, there was an immediate interest. Contacts were exchanged.

Anyone who has ever sold anything knows that an immediate positive response on the part of a prospect is solid gold. Then, if the "deal" is right -- the pricing, quantities, and terms offered are acceptable -- sales are quickly made.

This, however, is incredibly rare. Very, very few products "sell themselves." Especially perfumes.

So when you have a potentially hot product -- such as this perfume -- you want to pounce on it. This is where THE LIST comes in -- THE LIST is the difference between middling sales and grand profit.

I'm, not sure how involved I'd want to be with these people and this perfume. My own projects tend to keep me pretty busy. But, from my own experiences in marketing and with lists, I find myself "thinking out" what I would do to market this perfume and my first step would be to develop a list of small, successful, owner-operated boutiques specializing in jewelry or fashion, shops similar to the one I already visited.

And I already have a second shop in mind. That will make TWO shops for my list.

But to make this work I would need first, dozens, and then, hundreds of "doors" (as they are called in the retail trade) on my list. And each of them has to be hand picked as being "right" for this perfume. To do this I'd have to reach out to people in other parts of the country that might know of appropriate shops in their areas.

And commission structures up and down the line would have to be worked out.

If you've dabbled in marketing at all, what you're beginning to see is something akin to "multi-level marketing" or "affiliate marketing" but this is not all that different from the corporate marketing techniques of big companies such as Procter & Gamble and IBM -- dividing markets into regions and then sending out salespeople into territories.

But it all comes down to THE LIST -- knowing which doors to knock on so that a reasonably high percentage of sales calls will result in orders.

Now as I doodle with these thoughts, I'm not thinking of imagining first a national sales organization and then working my way down to small salesperson territories. No. I'm thinking of STARTING with a small territory -- shops within pleasant driving distance of my home, shops my wife would like to visit regardless -- and seeing how many I can uncover within, say 50 miles of my home.

Now about this list. What about competition between stores and exclusivity?Not a problem unless ... unless one of the stores wants to advertise this perfume, to put its own money behind promotion. Then I would consider giving it an "exclusive" within a specified territory.

But I think, for the most part, each store has its own customers. And, should this perfume be seen by someone in more than one store, that goes to boost the perfume's credibility and make more sales for both shops.

As for my mental marketing plan, besides the two shops already on my list, I have two contacts elsewhere in the USA who might be interested in showing this perfume around.

My list is going to grow.