Interparfums Has Confidence in Coach

It has not been a brilliant year for accounts Interparfums, in fact the company has experienced only a small growth in turnover of 2% measured at constant exchange rates. Given billing exchange differences up to 10% in  2015 to 327 million euros, despite having had a good performance in more mature markets like the EU and the US.

Montblanc, Jimmy Choo and Lanvin brands occupy two-thirds of its sales of their fragrances. For the full year, sales were based in Europe ahead in most regions. The three most important markets were North America, Western Europe and Asia, achieving growth (in local currency) of 25%, 10% and 3%, and also achieved a top-line growth in smaller markets such as the Middle East and, surprisingly, despite the crisis in Russia in Eastern Europe. However, not surprising that, with the economic situation in Brazil, sales in South America were reduced drastically in 2015.

The brands that grew the most were Jimmy Choo (41%), Boucheron (27%) and as we said, Interparfums executives are really pleased with the launch, which took place in April 2015, the male line of Coach. On the downside, we see a drop in sales of Dupont (-19%) and notably Karl Lagerfeld, but managers say that the fall of 43% of the brand, is because its successful launch took place in 2014, congratulating so because in this year sales have exceeded 10 million EUR.

Agreement with Coach.
Interparfums turned page after the loss of license perfumes Burberry, which was curiously the first brand that once it acquired and developed a range of perfumes for the New York-based Coach.

The first result of this collaboration fragrances hit stores in the fall of 2015, under an agreement signed between the two companies validity of 11 years, according to the two companies said in a statement. The distribution of perfumes will range from department stores, perfumeries and through duty free shops as well as Coach own stores.

Strategy to increase market share.
The strategic objective of the company according Stanislas Archambault, CEO of Inter Parfums Luxury Brands (U.S.), is to increase its market share to 5%. To do achieve this  its managers have in mind conduct an internal reorganization to get a better data flow analysis to capture consumption patterns, trends etc… and a rethinking of the strategy of its commercial network, to perform field work more effective and to be closer to final customers. The company intends to extend the Coach  female audience,  the success experienced by man products.

«In women’s fragrances we have been relatively successful with Jimmy Choo, but we need a pivotal  premium to add  in our portfolio. We have confidence in the Coach line for it,» explained Archabault. The strategies mentioned seem laudable but, in our view, insufficient to achieve an ambitious goal of achieving such as  high global market share of 5%. In mid-March the company will publish all of its financial statements for 2015. We will analyze them.

Disclosure: The Luxonomist is not liable on the views expressed in the article. The text has been written expressing ideas freely, without receiving any compensation for it. The author does not have any business relationship with any of the companies whose shares are listed in this article.