Le Labo: Where Success Smells of Beauty and Dreams

Giorgio Armani tried to kill Fabrice Penot. At least, it seems his business almost did. A perfume designer, Fabrice worked for years on the House of Armani brand. But even though he was brought in to run the fragrance division, he was constantly called to answer to the financial and marketing departments, who demanded a justification—a real world example of how and where a particular concept has worked for someone else—for every idea he tried to pursue. Demonstrating tested marketplace success before acting is the opposite of innovation, and nearly drove Fabrice Penot mad. A passionate, sensitive Frenchman, he says this nearly killed him, and I believe it. He finally broke free and started his own perfume brand—one which Armani and others now look to for their "road-tested innovation".

As Fabrice explains it, just a few decades ago there were only four or five major perfume companies in the world, each of which producing a new fragrance only every five years or so. This meant, first and foremost, that each was unique and special. It also meant that the brands would have high costs for each launch, heavily advertising their new product, but costs would drop dramatically in subsequent years when they would need much less marketing, and loyal customers would purchase additional bottles. Each new fragrance would become profitable just a few years after its launch.

The perfume scene today is drastically different, as thousands of new scents are launched every year. To meet the demand of the marketing departments, production is sped up, quality suffers, and ultimately one fragrance is rarely distinguishable from the next. This also means that though costs are still in the early advertising stages, there are no repeat customers, and no years of light marketing to allow the product to become profitable. “You don’t make money on the first sale,” Fabrice emphasizes, “you make money on the second. The first sale is from the advertising, the second is because of the fragrance.” It’s such a simple sounding lesson that he is still shocked when directors of corporate fragrance companies act like it’s a new concept.

When business moved Fabrice to New York, the change of scenery and sense of opportunity  was enough for him to make the break and launch his own endeavor. Together with another ex-Armani perfumer, colleague Edouard Roschi, Fabrice launched Le Labo (literally "The Lab"), and emphatically runs his business differently. With four boutiques internationally (New York, Japan, Sydney, and Los Angeles) and only a dozen or so counters within high-end department stores, Le Labo is considered tiny by industry standards. And he’s convinced that this is not only essential to maintaining the integrity of his company, but also its profitability.

The Le Labo experience is different from the moment a customer walks into a store, styled like an immaculate laboratory set in the framework of century-old apothecary. It is a fine balance of stainless-steel, glass, and white tile, with exposed wood and a pressed-tin wall (“a gift of the space”) which in combination creates a warm and worn-in welcome. There are just twelve fragrances, which are personally selected and custom mixed for each guest. Essential oils and delicate ingredients are stored separately in an industrial refrigerator, isolated from light and heat until the last possible moment. When a customer decides on a purchase, a staff member dons a white lab coat and blends the oils with distilled water and alcohol, and custom prints the label and packaging. Unlike anything mixed in a factory, Le Labo’s fragrances don’t begin to age until the moment of purchase. Value is placed on freshness, uniqueness, and the beauty of the imperfect, in a business which sees the goal of beauty, fashion, and fragrances to be about fulfilling dreams.

Dreams play heavily into Fabrice’s life and his business decisions. Not the sleeping kind of dreams, but the ones that fill his days with passion, light, and excitement. When approached by the very corporations that he spent years escaping from, he is reminded of how his dreams are different than most. Wanting to acquire his now-successful business from him, Fabrice told them to make him an offer, “to offer me my dream.” To his amazement they talked numbers with lots of zeros, and gestured to fancy cars with drivers and easy living. With a mix of disgust and disbelief, he reiterates, “This is not my dream! My business is about quality of life, about being part of something special, about filling other people’s dreams. Not about a driver.”

So for now, Le Labo stays small and independent, each business move agonized over to be sure they are maintaining that delicate balance that keeps them profitable while being able to express their passion to as many people as possible. Upon his first visit to the gorgeous free-standing multi-story shop their Japanese partner had created for them, Fabrice says he sat on the curb and cried. First, for the beautiful space they were to start working from, and second for the overwhelming amount of work ahead of them. Not to mention how he cried when he first came to the realization that Japanese people don’t wear perfume. But two years later, with extraordinary effort and a new fragrance designed exclusively for the Japanese shop, the store is already beginning to turn a profit.

But time and time again I am reminded that Fabrice’s business is not about the money. While walking through the neighborhood surrounding his Soho shop recently, he came upon a vintage clothing store called Mister Freedom, specializing in Depression-era workwear, and original designs with an "Old Country flair". Fabrice approached the owner to tell him him he thought it would be a perfect fit to sell his candles (the only fragrances Le Labo offers that are pre-produced and can be sold away from his shop). Not particularly impressed, the owner told him to come back later. When he arrived the next day with samples and gifts, Fabrice was greeted with a much warmer welcome—it turns out the shop owner’s girlfriend was a Le Labo convert and was unceasingly excited about the connection. So Fabrice set up a display, lit a candle, and went on his way. When he didn’t hear anything for a month, he called the shop to check in.

“We haven’t sold a single one,” the shop owner told him, “but you know what? When I look through the store and see them, and I smell them each day, it makes me happy.” Which was all Fabrice needed to mark the undertaking as an overwhelming success.

http://www.lelabofragrances.com