A Financial Outlook on Balenciaga Parfums and Fashion {The 5th Sense in the News} {Fashion Notes}

balenciaga-RTW-Fall-2010.JPGBalenciaga Ready-To-Wear Fall 2010 © Giovanni Giannoni

Perfume - as one may or may not fully realize - is one of the pillars of the fashion industry as it generates a democratic revenue stream that simply would not exist by relying only on the creativity of Haute Couture or even high end, research-oriented ready-to-wear. Selling fragrance bottles is not only a good cash flow source but a brand carrier. A successful perfume will contribute in a major way to building the mythology of a fashion brand. Yves Saint Laurent, Chanel, even Dior can be grateful to the perfume industry for their prestige and freedom as couture houses....

The reverse is true as well, n'est ce pas, the fashion industry has brought a precious commodity to the perfume industry: glamor and more tangible, easier to grasp ideals of beauty for a mostly visually-oriented culture.

Now, Haute Couture fashion collections could also be scrutinized, and have been, by someone like Dana Thomas in Deluxe: How Luxury Lost its Luster as being in essence upscale publicity campaigns for the brand with no real practical aim to be profitable.

In the end, it might all have to do with advertising and dream factories rather than fashion or perfume, except for those who believe in their art forms. But even couturiers and the most successful ones at that have been acutely aware that fashion is 50% art and 50% commerce, like Christian Dior used to say. When they neglect the commercial aspect of their enterprises, they experience difficulties like Christian Lacroix.

The Financial Times takes a closer look at the re-entry of Balenciaga into the fragrance business with their new Balenciaga Paris Eau de Parfum. The article by Marion Hume gives some interesting facts about the history of the perfume licence...

  "According to Isabelle Guichot, the house's chief executive, Balenciaga is "one of the only names in fashion whose business model is not built on fragrance revenues. The name has been kept very pure and very virgin." Well, kind of. When Gucci acquired Balenciaga in 2001, there were existing fragrance licences that ran until 2008, thanks to Cristóbal Balenciaga's nephew, who sold the name on his uncle's death in 1972, despite the couturier's expressed desire that the label end with him. It then languished with the German conglomerate, Hoechst, which in turn sold it in 1986 to Groupe Jacques Bogart, which created such Balenciaga offerings as Rumba and Talisman. Remember them? Thought not. [...]

To do this, it must find buyers in North America (still the world's biggest fine fragrance market and where Balenciaga Paris launches next week), Germany (the biggest consumer in Europe, followed by France), and Russia (where the perfume launches next month), which had a long pre-revolutionary relationship with French fragrance that has been revived. Though the roll-out is being kept somewhat niche and the scent is sophisticated, it will still need to find fans in places, such as the mall, where no one is ever going to wear Ghesquière's slashed leather miniskirts."

Read more at Balenciaga Enters the Fragrance Market...

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