Flare Case

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Subject: Flare Fragrance Recommendation

Background:
Flare was founded in 1955 as a small manufacturer of women’s fragrances. Over a period of time, Flare has dominated the fragrance market, generating 9.5% of the total women’s fragrance market and had grown in to a No. 4 player in the U.S women’s fragrances market. Flare has released 6 brands in the market namely Loveliest, Awash, Summit, Essential, Swept Away and Natural. Economic crisis has impacted Flare’s market share. Sales in 2007 were 12% and by 2008, the estimate was only 2% growth. Flare’s goal for 2009 was to generate $7.5 million in incremental revenue and reverse declining sales trend.

Recommendation:
Flare should promote Natural with loveliest umbrella in 18-34 years age range and expand its efforts in the drug store channel.

Rationale:
1. Natural fits Flare’s portfolio, both financially and strategically. Promoting Natural with loveliest umbrella will benefit Flare to meet its target sales numbers for 2009. Loveliest brand was introduced in 1975 and it still holds a strong equity in the market. It is positioned as a classic scent in the older age group. These customers will serve as evangelist and contribute to the promotion of Natural brand. As a result of the focus group sessions (ex 5), Projected sales for 2008 for Natural is $9.1MM(ex 1). Based on forecasted numbers in table1, expected sales for 2009 could be $10.15MM. Keeping the same communication budget from 2008 of 2.7 MM to Natural in 2009 (exhibit 4), the expected revenue from Natural would be around 7.45MM (table 2).

2. Natural is a recent launch under the loveliest umbrella and it is reaching slightly younger demographic, who are looking for the environmentally safer products or so called “green product” (page# 2). Natural is currently positioned as a chic brand in the younger age group (ex 3). 18-34 year age group women are highly brand aware with sensitivity to premium and prestige brands and word of mouth is...
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