Coty Architects Bernd Beetz and Stephen Mormoris Start a New Fragrance Business

The men who built the mass fragrance category have recently taken on more niche interests.
Bernd Beetz, who built and led Coty as chief executive officer through the celebrity fragrance boom, and Stephen Mormoris, the former chief marketing officer for Coty, have a new global beauty business. It's called Edge Beauty, and through subsidiary Scent Beauty, the duo have a plan to build a next-generation, direct-to-consumer fragrance business.
Scent Beauty plans to partner with brands and personalities that have a point of view and create scents that speak to niche audiences. They've partnered with fragrance house Firmenich for the project, and will handle packaging design, manufacturing, warehousing and distribution on behalf of brand partners.
While it won't shun celebrities, Scent Beauty plans to center efforts around people or groups with a clear fan base.
"I basically invented the celebrity category with Coty, so I'm not saying it's going to be totally distant in the mirror, but it has changed a bit.…Time has moved on, and we have social media dictating the rhythm, and we're looking for talent and people who really have a clear meaning to their followers," said Beetz, who will serve as chairman of the new company.
"We can really work with those talents and really get close to the follower-ship with meaningful product executions," he continued. "The celebrity approach evolved with the influencer age."
Right now, Scent Beauty has license agreements with The Phluid Project, a genderless apparel company; Ron Dorff, a luxury men's sportswear line, and Renée Fleming, the famed opera singer. More deals are expected to come in the next six months.
It's a far cry from what Beetz and Mormoris went for while they were at Coty, where they built up fragrance empires for celebrities like Jennifer Lopez and Beyoncé that had palatable olfactory profiles and hyper sexualized advertising campaigns with mass appeal.
But these days, those seductive marketing tactics may as well be chucked out the window. That's simply not what the kids of 2019 want anymore, the executives at Scent Beauty contend.
"There’s a general malaise in the fragrance category in brick-and-mortar with a repetitive model of developing fragrances based on a sex and seduction concept, use of flankers, often use of price discounting and of course the fear of diversion and counterfeiting, and we felt strongly that we need to create a new ecosystem through e-commerce where we’re creating unique brands," Mormoris said.
"We see that Millennials and Generation Zers all over the world are looking for scents that enhance their sense of individuality, that are worn for the sheer pleasure of having heightened emotions and it's not necessarily about sex and seduction. Very often, it's about community connection, it's about being part of a community with a brand. There's a new way of marketing fragrances that goes beyond appealing to the opposite of same sex," Mormoris said.
A brand like The Phluid Project, for example, is "exactly the type of brand that has cultural relevance," Mormoris said, and "is addressing a different community who has very particular preferences and understandings of scent, and we're bringing those alive in our creations."
For that brand, Scent Beauty will launch a scent collection in the fall, with pre-launch sampling support at World Pride over the summer.
Ron Dorff will target men with an interest in wellness and luxury goods, and Fleming's first fragrance, La Vocé, a gourmand, will kick off a series of about 20 artist fragrances Scent Beauty plans to release over the next three years.
The goal is to "create a more relational culture with the consumer in fragrance, and a less transactional one," Mormoris said. The New York-based group will also search for regional projects globally, and set up international offices.
"I see a major opportunity to really jump-start the fragrance business and category again," Beetz said. "It feels almost like…when I launched Coty."
Globally, the fragrance category did nearly $60 billion in sales for 2019, up from $48 million in 2017, according to data from Euromonitor. Total sales in the U.S. were $8.3 billion in 2018, up from $8.2 billion in 2017, Euromonitor found.
Industry sources estimated that Scent Beauty could quickly scale up to become a sizable business — reaching $100 million in net sales within two to three years, and eventually surpassing the billion-dollar mark.
Right now, the business is backed by a group of private investors, including Beetz, "with a strong runway of capital investment," Mormoris said. Asked if long-term plans included taking the company public, Mormoris said it was hard for him "to imagine going public since everyone who works for the company is so obsessed with creating and running the company" and that his personal preference is not to have Scent Beauty hit the public markets.
The company will focus on licensing for brands that have not yet built a profile in the beauty world instead of acquiring existing licenses, and won't limit itself in terms of the scope of companies it would partner with, Mormoris said, ticking off chocolate, automobiles, community activists and writers as fair game.
"We're looking to capture the authenticity of the brand, and to do that, we need to create fragrances with a very specific personality, and sometimes that means the fragrance won't be liked by people who don't relate to the brand, but will be obsessively liked by people who love the brand," Mormoris said.
Scent Beauty has embarked on qualitative and quantitative testing with Firmenich, but doesn't use blind sniff tests because executives "feel it prefers a result that is a generic derivative of what's in the market," Mormoris said. It's going more for the super on-brand feel of Thierry Mugler's Angel, or Issey Miyake's L'Eau D'Issey, he said.
"We're looking at brands in the fashion category, designer, we're looking at naturals, we're looking at artists, we're looking at artisans and we're basically looking at culturally relevant brands within each of those sectors," Mormoris said.
Beetz said that, right now, the category has become "a bit pedestrian" and lacks innovation, which is something he and Mormoris are hoping to bring via Scent Beauty through products like scented waxes, to mists, to hair fragrance, to diffusers, Mormoris noted.
To market the lines, Scent Beauty is creating a network of about 200 ambassadors, who will be paid to talk about the fragrances on social media. The scents will be sold online, on the company's web site, and through brands' existing retail partners.
"Our ultimate goal is to be one of the largest fragrance companies in the world, where we're leading the category in terms of discovery of new brands and breaking barriers in terms of marketing models and reaching new consumers," Mormoris said.
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