■ Scent research and marketing well under way, a new growth engine

■ OHUI Prestance and Cathy Cat launch new perfume products and expand perfume lines

■ Plans to develop 200-300 scents a year and build a database

▣ LG H&H decided to develop scents as a new growth engine by setting up a research center specializing in perfume and by expanding differentiated scented product groups.

▣ LG H&H’s perfume research center “Scent Berry Perfume House” was recently opened within Seoul National University. The company plans to develop the research center, which currently has 14 researchers and a library of some seven thousand scents, into a world-class center with 30-50 researchers and a library of about 20,000 different scents by 2010.

▣ Scent Berry Perfume House was established to develop premium products highlighting scent as a main feature. So far, scent has been considered a secondary function of a product. “Emotional marketing” that appeals to consumers through scent or design has recently become a keyword in the differentiation of products.

▣ In order to maximize profitability by developing premium products with differentiated scents, LG H&H established the new research center by integrating aroma research teams that had been dispersed across different product groups under a single scent category.

▣ LG H&H began to emphasize scent in 2005 when Suk-yong Cha was appointed as the new CEO. This was a part of the “select and focus” strategy to boldly withdraw from low-profit ordinary brands and selectively promote premium brands.

▣ Accordingly, LG H&H entered the perfume business with the launch of OHUI Prestance in December last year. This year, the line of perfumes will be further expanded as OHUI Prestance and Cathy Cat introduce eau de perfumes and eau de toilettes.

▣ Household products, which had focused only on functionality, have also been upgraded to “emotional household products” featuring unique scents or designs. A good example of this is Beyond, a bath & body care brand. By last year, a total of about sixty Beyond products were launched in various scent lines. There are plans to launch an additional 120 products in the first half of this year.

▣ Scent Berry Perfume House plans to develop 200-300 scents a year to be applied to various products and build a database to promptly respond to the needs of customers and markets.