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The answer to these questions could have major implications for the luxury business. As the nation’s leisure manufacturers struggle to make a income in clothing, they’re looking to boost sales and profitability by expanding into attractiveness. According to a Mckinsey record, scent and cosmetics are a “flagship” firm that can generate expansion in many other categories for leisure brands.
But the strategy is not without hazards. The crammed type can be difficult to break. And the divisions of a brand often do n’t speak to each other, making it difficult to create integrated marketing and communications campaigns.
The event of Burberry, which took its beauty firm in- home under former Ceo Angela Ahrendts in 2013, offers a cautionary tale. The decision to terminate the company’s licensing deal with Interparfums Sa, which held the passport for its Montblanc and Van Cleef & Arpels perfume, sent shares of the company tumbling 9.4 percent on Sept. 6. Kering’s buy of Creed at a 14- days sales different in October moreover made investors sit up and take notice.