Philippe Benacin of Interparfums on Lacoste, a future niche brand and perfume prices

Caps screwed tight, the Lacoste perfume bottles have been boxed up, and are ready to go: at a fast rate of 40 bottles per minute, the Cosmeurop factory’s semi-automated production line is currently churning out the new Lacoste fragrances for 2024. The French sportswear brand’s L.12.12 perfumes are being manufactured in the ultra-modern, Strasbourg-based facility of the Superga Beauty group, which produces and packages perfumes for French group Interparfums.

Interparfums, which has secured the Lacoste fragrance license for the next 15 years, presented its 2024 plans to an audience of analysts, investment fund representatives and journalists in Strasbourg, mentioning also Superga Beauty, a subcontractor that is able to produce approximately 35 million units per year. Interparfums has been working for the last two years with Superga Beauty, a family company based in northern France which bought the plant in 2021, and is now one of a dozen France-based companies that produce and package fragrances for Interparfums, specifically the Rochas, Moncler, Karl Lagerfeld and Lacoste lines.

Philippe Benacin, CEO of Interparfums, said that, having paid €90 million in licence fees in advance for Lacoste, he is aiming to generate a revenue of €50 million to €60 million in the first year. An amount that would barely enable the group to break even with this licence. “I’ve always said that below [a revenue of] €100 million, this wouldn’t be a profitable operation,” said Benacin, who is nevertheless sure of Lacoste’s potential. “The license generated more than €200 million at its best. Lacoste is internationally renowned and recognised. It’s one of 15 global brands whose logo is as powerful as its brand name. It is set to become [Interparfums’s] leading brand.” A plan that is consistent with the goals of Thierry Guibert, boss of Lacoste’s owner MF Brands, who intends to rejuvenate the brand’s perfume business with Interparfums as its partner.

Benacin said his approach was to re-assess the Lacoste range. Of the 22 lines in Lacoste’s fragrance portfolio, Interparfums has kept 15. In 2023, the L.12.12 line, which accounts for most of Lacoste’s fragrance SKUs, accounted for well over half of revenue. In 2024, the line is set to continue to generate at least 50% of sales. The brand’s other main scents are Homme Lacoste, for men, and Touch of Pink, for women. A first Lacoste men’s fragrance developed by Interparfums will be released in 2024, and a first women’s fragrance will roll out in April 2025.

Benacin’s goal is to reposition Lacoste very quickly, to make its fragrances compete with the likes of Boss and Polo Ralph Lauren. “We have no commercial history by the previous licensee for 90% of markets. We are restarting from scratch distribution-wise, and we think we can shift into a more upmarket segment,” said Benacin. He is sure there is growth potential in the USA, a land of opportunity for Lacoste, and above all in the women’s perfume segment, which currently accounts for only a quarter of sales.

The results of the first fragrances developed by Interparfums will provide initial indications on the licence’s real potential.

A niche fragrance for Asia

Another opportunity for Interparfums is linked to the group’s future niche perfume brand, first heralded a few months ago. In his presentation, Benacin sketched out a few details. “It will be a luxury, highly exclusive fragrance, positioned in the segment that features names like Kilian and Frédéric Malle, available in two sizes. A 60 ml bottle priced at €160, and a 160 ml bottle priced at €260. We will present the fragrance to our distributors with an event in April 2024, for a release in 2025. This project is very different from what we have done in the past.” Asked about the fragrance’s name, Benacin hesitated slightly, before replying that it could be “the name of our headquarters.” In other words, 10 rue de Solférino, the Parisian address of the building Interparfums bought in 2021, and moved into in 2022.

Instead of aiming for the tens of thousands of stores through which Interparfums is selling perfumes like Jimmy Choo and Montblanc, the group’s future fragrance is expected to target a selection of hand-picked retailers. “We will only look for [retailers] where we’ll really be able to express this perfume’s essence to its fullest,” said Benacin, adding that “it could mean about one hundred locations, mainly in Asia. Niche perfumery is a growing segment volume-wise, and accounts for approximately 15% of the market. Its share is 5% in France, but it can exceed 30% on some Asian markets. We could generate momentum with an own-brand project in Asia.”

According to Benacin, niche perfumery doesn’t necessarily mean niche results. “We’re seeing brands like Byredo and Parfums de Marly generating more than €100 million in revenue. Without saying that it is a major result, it could be a significant boost to the group’s bottom line.”

A niche perfume could also enable Interparfums to diversify its price positioning. The new fragrance would slot in above the recommended prices for the other brands distributed by the group. Despite significant cost increases, particularly in glassware, Interparfums has in fact adopted a strategy of prudent price rises.

“To raise prices, you have to take into account each brand’s power,” said Benacin. He added that “luxury giants like Hermès or Dior can afford any increase. Chanel is selling at €150-160 perfumes that were priced at €110-115 three years ago. Luxury labels are aiming for a more selective clientèle, as they did for leather goods. But other brands cannot aspire to this. There has been an increase in prices and a decrease in volumes, of the order of 6% last year. With inflation, I think there is a psychological threshold issue. For example, with Jimmy Choo, the eau de parfum’s recommended retail price is €120. I don’t think it can be pushed up to €170.” In this context, the Lacoste range, which is more affordable, should be positioned slightly above €100.