Roller coaster for Perfume Licenses

In July, P&G decided for a buyer of its Prestige Devision (fragrances and bodycare).The whole division got started, when P&G took over Wella AG, which itself had bought Muehlens KG (4711, Sabatini, etc.) before. And P&G added more luxury licenses over the years.

Then P&G acknowledged: we only can do mass market properly. And as a first step they sold off brands, without the potential to be 1 billion brands. Now the whole division was for sale.

The buyer is Coty Inc., the purchase price is US$12.5 Billion.

But Coty is one of the biggest licensees and brand owners in perfume and cosmetics itself. And it now adds to the portfolio brands like Hugo Boss, Dolce & Gabbana, Gucci, Lacoste, bruno banani, Christina Aguilera, Escada, Gabriela Sabatini, James Bond 007, Mexx, Stella McCartney, Alexander McQueen, Max Factor and Covergirl.

The list of overlapping and competing brands probably is equally long. Even as Coty markets by segments like luxury, premium, mass, more than a few licensors might feel like the 5th wheel now, or maybe the 10th. Does Lacoste want to be next to Adidas? Mexx besides Esprit?

Some licenses traveled a bit already. For example from L’Oreal to P&G to Coty. Another change might not be good or even possible there.