Sniff Sniff: Olfactory Marketing

(Promo) Put a bowl of Hershey Kisses on a counter, add the smell of chocolate and you’re on your way to one of your most successful product launches.

That’s what Verizon Wireless did last fall when launching its LG Chocolate phone.

The scent, emitted by small plastic strips, “created excitement, and in this category, that’s a big advantage,” says Joe Fiamingo, manager of print production distribution and fulfillment for Verizon Wireless in the Northeast.

Verizon Wireless isn’t the only firm to use scents as a point-of-purchase (P-O-P) marketing device. Thanks to new delivery tools, stores of all types are getting more aromatic.

Take Target, the scene of tests by two major fragrance brands.

In one, Esteé Lauder is running a display in about 80 outlets. It features fragrance compacts that shoppers can apply to their skin and smell (a marked advance over the tester-bottles widely used in department stores).

And Elizabeth Arden has just wrapped up a three-month test of its Fragrance Tester bars. What are those? Plastic compacts filled with a solid that feels a little like a deodorant stick. Consumers rub their finger across it, then apply it to their skin.

These compacts match the smell of a fragrance with 87% accuracy, says Desmond Walsh, a client service manager at Mechtronics Corp., the firm that makes the displays for Elizabeth Arden. By comparison, scratch-and-sniff stickers on-pack can match the fragrance with only 15% accuracy, and shoppers can’t apply them to their skin.

The technology is so new, in fact, that Mechtronic and Elizabeth Arden have jointly applied for a patent on the Solid Tester, Walsh says.

Just how widespread is this phenomenon?

Marketers spent $50 million on scented P-O-P in 2006 and that sum is expected to grow to $100 million in 2013, says Harald Vogt, founder of the Scent Marketing Institute. Most of the money last year was spent on “environmental scenting,” or the pumping of fragrances into stores or hotel lobbies.

“It’s easier to target people on an emotional level [with environmental scenting] than on a cognitive level, with sampling that drives people to a buying decision,” Vogt says.

As for results, Elizabeth Arden generated double-digit sales increases with its test, and is now deciding whether to roll the displays out in all Target stores, says Rafael Latour, senior trade marketing manager for Elizabeth Arden. And while it didn’t do as well with a test in about 10 Wal-Mart outlets, it has learned a great deal about how to maintain scent displays.

And Verizon Wireless did well enough to give scents “another shot, depending on the next brand name we launch,” Fiamingo says. But he admits that it’s not easy to measure the effect on sales.

The nose knows
How did Verizon Wireless, which had never used scents, decide to try one?

The idea came up during a brainstorming session for the Chocolate launch.

“We were tossing ideas around and someone said, ‘It’s a shame we can’t get it to smell like chocolate,’” Fiamingo says. “So I started looking into how we could do that.”

Fiamingo considered oil on a sponge or a solid air-freshener. But he decided that both would be too messy, and that they would quickly peter out.

Talk about lucky timing. Marins USA, a specialist in P-O-P, called with an idea for a scented plastic strip. And Fiamingo went for it.

“We fumbled through a couple of executions on how to get the strip to adhere to the display, because the strip is oil-infused,” Fiamingo says. “Once we got the process down, it stuck to anything.”

Shoppers got their first whiff when they entered the store, thanks to window banners and posters coated with a scented varnish. Then the scent became stronger as they got closer to the “What’s New” wall.

While subtle, the smell was noticeable within a few feet of the displays.

“We didn’t want to assault anyone,” Fiamingo continues. “We wanted a hint of chocolate smell, not like you were walking into a Hershey factory.”

As for cost, Verizon Wireless used 1,200 displays in its stores, in Circuit City outlets and B.J.’s Wholesale Clubs throughout the Northeast. The scent strips added about $10 to the price of each display, says Jim Matera, the Marins USA executive who oversaw the campaign.

These displays are shipped in a polybag. The scent kicks in when opened and exposed to air. Marketers can tailor the strips to provide the intensity and time limit they want. The aroma is layered into the material — more layers, more time, Matera says.

Breathe easy
Of course, none of this should be tried without careful planning. Verizon Wireless has the advantage of owning its stores, but marketers who don’t control their retail channels face some hurdles.

“Retailers want brands to bring scent in, but only if it doesn’t cause any trouble — like complaints from consumers or competitors,” Vogt says. “They say, ‘If everyone brings in scent, our store will smell like a magazine.’”

Moreover, store managers expect the displays to be environmentally friendly and easy to work with and dispose. They also like to see data linking scents to increased sales. But the concept is so new, there is no data, according to Vogt.

“I hope next year we’ll have some successes to show retailers,” he says.

Then there’s the issue of consumer sensibilities. San Francisco bus riders objected fiercely when exposed to the smell of freshly-baked chocolate chip cookies at their stops, part of a promotion for the Got Milk? campaign.

Vogt urges marketers to produce scents “in a space you can control. If you do it in public spaces, you expose yourself to things like what happened in San Francisco.”

Can scents harm people with respiratory ailments?

Not at all, says Vogt. With existing technology, scents are “either nebulized or ionized into extremely small particles that would not affect anyone’s health or someone with asthma,” he says.

But experts concede that not every odor will attract consumers. For example, Verizon Wireless took a pass on displays for Motorola’s MotoKrazr Fire because “we didn’t think the scent of burning ash would work as well as chocolate did,” Matera laughs.

What’s next in the scent business?

ScentAndrea, creator of the strips used by Verizon Wireless, is testing several other locations and delivery mechanisms. For example, releasing the smell of chocolate near vending machines boosted Hershey sales 300%, and Mars sales 18%, CEO Carmine SantAndrea claims.

And the aroma of coffee and donuts at gas pumps lured 50% more drivers into the attached convenience stores. That test, now in 20 stores, will expand to 100.

“We have to convince retailers that if their stores smell better, consumers will linger longer and shop more,” SantAndrea says. “Plus, if they allow brands to bring in fragrance on their P-O-P, they’ve found another way to reach into the pocket of the brand. They already sell shelf space and floor space; now they can sell air space.”