Three ways to mess up a good marketing opportunity for perfume
Sometimes we come across marketing opportunities for perfume that should be wildly profitable. The people are there, they want your perfume, they are eager to pay your price. What can go wrong? There are three simple ways you can mess up this opportunity and earn only dimes when you could have earned dollars.
Mess up # 1 — Addressing a mirage and missing the real market
What's the real size of your market? Not everybody who matches a particular demographic is your market. Your real market is concentrated — people who will respond to you and your perfume, people who are enthusiasts for you and for your perfume, people who have enough mad money on hand to buy it.
If your true market — potential buyers — is about 5,000 people but you allow yourself to think your market is really tens of thousands, you will make harmful mistakes in your planning. You will, within the limit of your resources, produce more perfume than you will ever be able to sell, and you will spread your promotional dollars too wide and too thin, meaning a lot of effort and promotional money will be wasted trying to sell people who could never have an interest in your perfume.
Because of this misunderstanding of your real opportunity, you fail to make sales you could have made — to people who could have been excited by your perfume — and you produce more inventory than you can possibly sell. This drags down any profit from the few sales you might make.
Say in this case you have $25,000 for promotion. Instead of using that money to make a big impression in a hot, well focused market segment, you try to influence too many people — far too many — so you buy one or two big ads (all you can afford!) to a very general audience (say ALL Facebook accounts of women in a certain age group!) rather than hammering away, again and again, at a highly focused, highly select market segment.
The result? No results!
Mess up # 2 — Too much production
Marketing opportunities come in different sizes. You have an opportunity to sell 5,000 bottles but you produce 10,000. Look what happens:
Say your cost to produce a bottle of your perfume is $4.50. You wholesale it at $17.50 and it sells — successfully — at retail for $35. But "successful" relates only to the 5,000 people who want your perfume. That's all who want it. That's the size of your market. But you produced 10,000 bottles. You're left with 5,000 bottles you paid $4.50 each to produce but can't sell. Let's look at the math:
Your cost per bottle was $4.50.
You sold 5,000 bottles at $17.50 each.
You paid $22,500 to produce those 5,000 bottles and then sold them for $87,500 giving you a gross profit which would have been $65,000 were it not for the $22,500 you paid to produce bottles you didn't sell. Your profit now drops from $65,000 to $42,500 — only 65 percent of what you would have earned if your production was matched to true market size.
Mess up # 3 — You paid too much for your perfume, even when you knew what its highest possible retail price could be
This is the classic cause of marketing failure in almost any field — the opportunity is hot but you pay too much to obtain your product (in this case a perfume) even though you know what its highest possible retail price can be.
Say your perfume will retail for $35 and you will wholesale it for $17.50 and correctly expect to sell 5,000 bottles. Your gross receipts will be $87,500 but now you have to deduct the cost of those 5,000 bottles.
Say your cost per bottle was $4.50. That's a total cost of $22,500 giving you a gross profit of $65,000.
But say you lost track of your numbers. You wanted to make your fragrance a bit more elegant and you failed to negotiate to drive down your costs. Now instead of $4.50 per bottle you end up paying $11.50 per bottle (yes, it can happen!) so now the cost of your 5,000 bottles is $57,500 and your gross profit will only be $30,000 — half of what you might have made! Investing $57,500 in product to make $30,000 (gross!) is not so exciting.
The most profitable marketing opportunities come in fixed sizes. You maximize profit by understanding (judging correctly) the size of your opportunity. You produce just enough perfume to meet the anticipated demand. You don't fret over the handful of people who say they want to buy your perfume but waited until your supply was sold out. You don't produce another 5,000 bottles of perfume because a dozen people failed to buy it while it was available.
When you start to think about perfume marketing in narrow terms, small markets, you are headed in the right direction for making good money. It's easy to become distracted and want a big score with a single promotion but the odds are against you. To make a highly profitable business out of selling your own perfume, think in terms of "small" markets, markets that practically lust for your perfume. There are lots of them but they must be addressed one at a time.
Don't be misled by the hypothetical gross profits shown in the examples above. The cost per bottle of your perfume is very important but it is not the only important expense you must harness. Advertising and promotion can be a large or small expense, depending on a number of factors. And, oh yes, there are those "administrative expenses" to deal with — the cost of running your office and operation. If, on day one, you sign a lease on a fancy car because you think you need it for your "image," most likely your business will be doomed from the start.
Steffen Arctander's Perfume and Flavor Materials of Natural Origin was first published in 1960 and is the classic, authoritative reference for natural products used in perfumes, scents, flavorings, foods, and medicine throughout the world. Part One defines and describes processing methods used to extract or refine the products into usable form; Part Two includes more than 500 monographs on the natural raw materials used to produce perfumes, flavorings, etc. Appendices include a classification of important materials by their scent, and worldwide production figures for major products. Fully indexed, the book also includes 62 pages of photographs, making this the standard reference work on natural materials for perfumers and flavor chemists. The preface contains practical descriptions of available materials, their origin, production and processing methods, appearance, odor and flavor type with brief notes on their main constituents, replacements and common adulterants.
Perfume is famous for the markup it can achieve, even for a middle market fragrance. While "everybody knows" that perfume costs next to nothing to make (not completely true) the making of it is often considered an esoteric secret. "Creating Your Own Perfume With A 1700 Percent Markup!" details how a 3-person company with no experience created their own fragrance in response to a marketing opportunity that was too good to pass up. The book explains exactly what was done to create a fragrance for that opportunity but it is far more than a history of the author's project. "Creating Your Own Perfume With A 1700 Percent Markup!" lays out every step in the process of creating your own perfume, either as a do-it-yourself project – and without the benefit of automated equipment some compromises and workarounds are required – or full bore professional production under your supervision. Either way you will be producing a quality fragrance at a remarkably low cost. Do you have a marketing opportunity that would be wildly profitable if only you could obtain your fragrance at a ridiculously low cost? "Creating Your Own Perfume With A 1700 Percent Markup!" is the guide you need to do it.
A really great name, a special name that is just right for a particular perfume or perfume marketer (or entrepreneur with money to invest!) can be worth a ton of money. But few individuals with great ideas ever manage to cash in on those brilliant ideas. Instead they wait while others "discover" their idea, acquire legal rights to it and make all the money while they are left out in the cold without a penny having been earned for what was once THEIR idea.
If you are struggling to name your perfume and are looking for a name that will have real value, "Naming Your Perfume And Protecting Your Name" will help you weed out low value names and point you to names that have better marketing value plus the potential to become valuable assets in themselves.
If you have a great name you want to protect but no fragrance, "Naming Your Perfume And Protecting Your Name" will guide you through the simple steps you must take to acquire a legal right to that name before someone else grabs it! Best of all, "Naming Your Perfume And Protecting Your Name" shows you how to gain strong legal protection for your name without a lawyer and without spending more than pocket change.
Never had an idea for a product name? Never thought much about perfume? "Naming Your Perfume And Protecting Your Name" may stimulate your interest in a whole new game that, when played well, can make you lots of money without your having to leave the comfort of your home office.
You can build a perfume business of your own using this business plan as a guide. By following its detailed strategy you learn to identify motivated groups of potential perfume buyers. Members of these groups are near the tipping point of desire for a new perfume. You don't know these people and they don't know you but you know a marketer they trust, one who does not currently sell perfume and might never think of selling perfume were it not for your approach. Here is where you step in with a professional plan, promotion, and perfume to take advantage of this ripe opportunity for mutual profit. Before your first promotion has peaked, you will already be developing a relationship with your next marketing partner. Following this plan, you will gain more and more profit with each new marketing partnership.
Now when you make your own perfume you can make it fully "commercial" meaning you will be creating a product ready for regular, continuous sales to friends, relatives, and the public! If the fragrance you've made has already won praise, why not share it with others? Some might pay you for it and want it for their web stores or retail boutiques! Creating your own perfume from dropper bottles: Methods, mechanics, and mathematics guides you through steps that can turn your hobby project into a perfume business. Discover how close you are now and how little more you must do to take what you made with essential oils and dropper bottles into a business of your own! For an introduction to this book, watch this video.
When you name a perfume you create a valuable asset – the name itself. To sell your perfume you want the most effective name possible. But a good name can have value beyond the edge it gives your sales. In naming your fragrance you are creating a trademark and a trademark can have value independent of the product. The value of that trademark can vary. Much depends on how well, in naming your perfume, you follow the trademark "rules." How To Create A More Valuable Name For Your Perfume first helps you develop a name that will be effective in selling your perfume. It then prods you to make use of certain techniques that can turn a good name into a great trademark, strong and valuable. If you have questions about how to protect a name, How To Create A More Valuable Name For Your Perfume will answer many such as:
- Can you protect your name yourself or do you need a lawyer?
- Can you register a trademark without a lawyer?
- What does it cost to register a trademark?
- How do I enforce the rights I have established?
How To Create A More Valuable Name For Your Perfume covers both state, federal, and international protection.
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