»TV advertising helped us to become successful.«

Kathrin Nusser, CFO & Managing Director flaconi

From perfume, make-up, and hair care to natural cosmetics and premium brands – flaconi is one of Germany’s leading online perfumeries. Founded in 2011, today flaconi employs a workforce of more than 380 people. ProSiebenSat.1 has held a majority stake in the company since 2015. For over a year now – since January 2018, flaconi has also been part of NuCom Group, the Group’s commerce business. In our Insights Interview, we spoke to CFO & Managing Director Kathrin Nusser about flaconi’s success story, plans for internationalization, and the role red lipstick can play.
flaconi has been growing dynamically since its formation and the takeover by ProSiebenSat.1. What is your recipe for success?

We always focus on our customers and their individual needs by offering them the freedom to choose what they want out of over 40,000 products from more than 600 brands at any time, from early in the morning to late at night. We also have an attractive price-performance ratio. In a nutshell, we offer our customers all the advantages they expect from a beauty shopping experience – a constantly growing product range, fast delivery, excellent customer service as well as a straightforward return process. Our efforts are paying off: flaconi enjoys a high customer loyalty, which means that our customers keep returning. This has been confirmed by a nationwide survey carried out by FOCUS magazine showing that flaconi has the most loyal customers of all online perfumeries in Germany [1], which makes us extremely proud.

How does flaconi distinguish itself from its competitors?

Many of our competitors have their roots in brick and mortar business (B&M), while we are a 100% online player always approaching the business from the online angle, which gives us a high degree of flexibility. For example, our actions are very much based on data: We can respond in real-time and thus adapt our offerings to the requirements of our target group. In addition, our customers can choose from a wide product range – brick-and-mortar retailers often lack the space for this. In the years to come, we will see that the majority of young brands does not wish to work with a company that can only guarantee them availability in stores. In addition, we are able to support product launches in a tailored manner through targeted promotions. Moreover, we draw many advantages from being a part of ProSiebenSat.1, their TV and advertising expertise: From legal conditions and the design of the perfect marketing mix to communication with other NuCom Group companies – flaconi benefits from the Group to a large extent, which also helped us to increase our revenues more than 12 times since 2014.

“TV advertising helped us enormously in becoming more and more successful.”
What role does TV advertising play at flaconi, and what marketing approaches will you take in the future?

As mentioned before, we did not grow out of B&M business. This means that customers initially neither have known the brand nor have they seen our logo at a shopping mall. TV was an important lever to increase brand awareness and earn customers’ trust. Therefore, TV advertising helped us enormously in becoming more and more successful. Today, our aided brand awareness is 60%. We will therefore continue to use a combination of TV and online advertising, such as scheduling spots around “Black Friday”.

In 2018, you developed a branded entertainment format together with sixx. What experiences did you gain from this?

Working with sixx, the women’s TV channel, was a logical step for us – after all, our target groups overlap significantly. We believe that TV will continue to play a major role as an entertainment medium in the future. Be it linear, mobile, or via video-on-demand – great formats will always be appealing. Being part of ProSiebenSat.1 puts us in the outstanding position of being able to draw on the Group’s expertise and to try out new things together. The makeover format flaconi macht dich bereit (“Getting ready with flaconi”), for instance, which we created together with sixx in November and December 2018, gave us the opportunity to broaden the flaconi brand once again. We are more than “just” an online shop – our customers don’t just shop, rather they experience. The motto of our TV spot, “Macht euch bereit” (“Get ready”), fit the format outstandingly: The makeover show’s candidates received extensive advice from experts and were given tips and tricks on how to better accentuate their personality with the right make-up, a well-chosen outfit and an appropriate hairstyle. Our objective is both to empower women and to boost their self-confidence.

“Expanding was a logical step.”
Since September 2018, flaconi has also been present in Austria. Why did you decide to take this step, and can you say how has it been going so far?

After seven years in which we had already been successful in Germany and continuously optimized our business model, we asked ourselves how we can grow organically in the next few years, and in which direction we would like to develop? Expanding was a logical step. Austria offered us the perfect opportunity to extend our business model to a new country without having to overcome language barriers. As an organization, we are learning what it means to operate in a country outside of our own: What does that imply for our brand cooperation, for our procurement, and for our marketing strategy? flaconi has had a successful start in Austria and is making for excellent growth rates. The process is incredibly exciting and will help us in terms of future internationalization. Each and every day, we are experiencing the difference of our Austrian and German customers, their desires, and expectations.

In October 2019, the German e-commerce company expands into the next fast-growing beauty market, with a statistical volume of around 4.7 billion euros and a very high online share: Poland. Already at the start, customers expect more than 500 beauty brands and over 15,000 products.
"After our great success with the launch of flaconi.at in 2018, Poland is the next big step on the way to becoming the number one online beauty destination in Europe."
What are your plans for 2019?

When it comes to products, we are having big plans for 2019: Our goal is to position flaconi everywhere, e.g. via our “Eve by flaconi” app, offering users beauty news, tutorials, and inspiration, as well as other apps that are being developed currently. In addition, we are driven by the issue of personalization such as displaying products that are relevant to the respective customers only: Nobody will look at a results page with 2,500 products on their phone. Instead, we really want to show customers the products that are relevant to them. What we’re trying to achieve in the long run is to become a platform offering every single item a customer could need. Hence, we are extending our product range and always strive for improvement.

“Our wish for the future is to become the number one online beauty destination in Europe.”
Where do you see flaconi in five years?

Our wish for the future is to become the number one online beauty destination in Europe with our goal of growing into the market leader. In addition, we aim to further push our internationalization in the next five years and to provide a one-stop shop. We want to be our customers’ go-to for all things related to beauty. We are motivated in particular by one idea: As a team, we want to redefine beauty by showing automatically our customers the products that are of interest and relevance to them. We consider beauty as a lever for boosting self-confidence – a fact that is not to be underestimated. Whether it’s the red lipstick for a job interview or the special scent for a first date, it’s the small things that give you strength. With flaconi, we aim to be the organization helping our customers to have a successful, perfect day – a brand image we are aiming to awaken in our customer’s minds.