00:00When you think about perfume, it's kind of one of the life's little luxuries, but presumably people are happy to pay up for a perfume when they're feeling good about things.
00:08So is the consumer feeling good right now? Yes, consumer is feeling good.
00:13Fragrance is still very resilient in the beauty environment.
00:20It has been the fastest growing segment in beauty for four or five years, and it's not stopping.
00:26We are starting now the Christmas season, so soon you're going to go to department stores, specialty stores, and you're going to see our gift set, value set that we push for Christmas.
00:38And we see no slowing in the fragrance, for sure.
00:44You own a number of, well, you own a couple of scents of your own, right? Landvin and Rochas?
00:50Yes, we do. Yeah, good, good.
00:52And then you do licensed fragrances for a ton of businesses, from Abercrombie & Fitch to Lacoste, Guest.
01:02We have a list of some of them here, Jimmy Choo, Kate Spade Coach.
01:06A lot of American brands.
01:08A lot of American brands.
01:09Where are you making these scents, and what kind of tariffs, if any, do you face?
01:15Yes. So, the tariff has been hitting us a little bit by surprise, but basically our company sells 50%, has 40% to 50% of its business in the U.S., and 40% to 50% of its business outside of the U.S.
01:35So, with this tariff hitting us, we have taken a very simple decision.
01:41But where do you actually bottle the perfume?
01:43The products that are sold in the U.S. are bottled in the U.S.
01:48I see.
01:48The products that are sold in Europe, for instance, will be bottled, filled in Europe.
01:58Before the tariff, we had a lot of products filled in the U.S. and re-exported to Europe or the Middle East.
02:09But the decision of the company has been to manufacture closer to where the product eventually will be consumed.
02:19One of the interesting things in cosmetics right now is just how much of a moment they're having on social media, at least for tweens.
02:26You get even younger than tweens, six-year-olds buying weird skin care products because they see some influencer doing it.
02:31How much of marketing for perfumes right now and consumer habits are also being shaped by what people are seeing influencers do on TikTok?
02:41So, social media is the name of the game.
02:44It doesn't mean that the traditional department stores and brick-and-mortars are not doing their job.
02:51But it's true that something happened in the last three years.
02:56People can buy a fragrance without smelling it.
03:00You can go on Amazon.
03:03You can go on TikTok and listen to someone talking and describing a flavor, creating an emotion.
03:13And then you click and you buy.
03:16This is new.
03:17This is new.
03:18You used to go to a store and be a little harassed by the beauty advisor behind the counter.
03:25You can still do that, but yeah.
03:26Yeah, you can still do it.
03:27But today, I think that people are curious about the ingredients.
03:32And before the show, you told me about one of the fragrances you were wearing.
03:38And you remember that it was orange, neroli, and fig.
03:42And I think that more and more people, and we're going to talk about the younger customer, are fascinated by what is in the bottle.
03:52And I don't know about six-year-old using skincare, but we see a lot of 12, 13, 15 years old going to TikTok and creating a wardrobe of fragrances.
04:09And these are not cheap.
04:12They go and spend $200, $300.
04:15Where the money comes from, you should ask the parents.
04:18You are based in Paris.
04:22Yes.
04:22But you also have a stock listed here in the U.S.
04:25Yes.
04:25And I wonder what you think about, completely separate from this, quarterly reporting.
04:30Because it's an issue, again, you know, whether or not companies should have to.
04:35And the reasons that, you know, critics of quarterly reporting have come out against is that they think it encourages short-termism, a myopic view from the C-suite.
04:45What's your take on the requirement and, you know, your leadership style?
04:51Would it change if you didn't have to report quarterly?
04:53It's a great question because we have been a public company in the U.S. for 38 years.
04:58So we have been filing quarterly for 38 years, which is, I think, bad for business.
05:09The quarterly reporting is bad for business.
05:13It encourages a short-term vision.
05:19And I understand investors who want transparency and they want to know what's happening.
05:24But if they think that a quarter makes or break a company, it's totally ridiculous.
05:31I think that eliminating this quarterly report and go to a six month, because I think a year is a little too long to see if things are good or bad.
05:40But six months is a good, is a better timing.
05:44So would you do things differently if you didn't have to report quarterly?
05:50I think it will create less pressure on the team.
05:57And, of course, we're going to save money on reviewing auditors and administration for sure.
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