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Bringing back luxury Insight: Fragrance consumers as being too commonplace. In travel retail too, the industry is seeing low-cost retailers in Europe, such as Equivalenza, n n n Sources say for example, that Hermès is looking initiatives aimed at creating a more exclusive which offers low-priced copy-cat scents of to reduce distribution in some markets to take environment with an edited assortment. Travel- major launches. These low-cost stores are also the brand even more upscale. retail operator Qatar Duty Free for example, coming up with a more premium look and offer, However, it is unlikely that the main players teamed up with L’Oréal Luxe this summer to providing consumers with a more luxurious will drastically cut distribution, given the loss of launch a fragrance pop-up store at Hamad shopping experience than in the past. sales that this would represent and the need International Airport, Doha. The pop-up store, Industry watchers add that the number of for a wide distribution to maintain strong brand scents on the market continues to take away awareness fueled by massive ad campaigns. from the perception of luxury. In 2014, there Houses such as Chanel and Dior for example, are were 1,620 new fragrance launches including instead choosing to focus on the brand’s history “ 263 limited editions and 275 fankers, according and couture links, as well building their high-end My feeling is the future to Fragrances of the World. collection or exclusive lines. More mainstream blockbusters will come from Analysts say that there is simply too much on brands could, however, open their own the market and too many mediocre scents, and standalone boutiques—similar to what many of [niche] brands. Their success that the industry would be better off putting the niche fragrance companies have done—in will be the result of a slow more investment into creating a scent that will a bid to better showcase their luxury image and build up. In other words, we be able to sustain itself rather than coming out offer better services. with a constant stream of new product. This are going back to perfumery, is just as true now for the mainstream market More upscale retail like it used to be in the 50s as for the niche segment. Editions de Parfums As luxury takes hold, it will merge with another Frédéric Malle’s Malle comments: “There are ” key trend—customization—and a number too many newcomers, most of which are very of companies are now beginning to offer mediocre and make things confusing and bespoke fragrance services. One is German Editions de Parfums Frédéric Malle generate disappointment at a customer level. I fragrance company Unique, which offers an founder Frédéric Malle hope that this will change,” he says. online service and is partnering with brands Despite this, analysts say that the move and retailers to offer customized perfumery as towards premiumization will see the fragrance a gifting option. Unique teamed up with French called When East Meets West, showcases market turn a corner and that trends from retailer Nocibé to launch a tailor-made fragrance fragrances from fve L’Oréal brands. Each of the high-end will begin to trickle down to all creation service on its website for Mother’s and the brands show oriental and Western-style of the category’s tiers, which will change the Father’s Day this year. The site let users create fragrances. The pop-up shop also offered a bottle industry for the better. “My feeling is the future personalized women’s or men’s fragrances by engraving service. blockbusters will come from [niche] brands,” choosing the type of scent from fve categories says Malle. “Their success will be the result of a (and by selecting up to six notes from a range Discounting and price sensitivity slow build up. In other words, we are going back of 50). Customers could also choose their own While there is a trend towards the high end, to perfumery, like it used to be in the 50s.” In fragrance bottle from 15 different designs. at the same time discounting in some markets short, luxury is here to stay. n The bottle could be personalized with a has never been so rife, thereby devaluing the message, a name or a photo. Other options for category. While in the past, discounting was retailers to offer personalization include bottle reserved for certain periods, it has now become engraving and gift-wrapping services, which an all-year-round affair. In France, for example, Sephora has introduced. market-research group NPD said that last year, Still room for mass Retail spaces are evolving to meet changing almost one in two fragrances was bought on a Although there is a trend towards more consumer tastes too. Fragrance halls are being discount. In addition, retailers are being accused luxury fragrances, blockbuster brands need remodeled to lose their generic appearance of even discounting new launches, something not worry about their place. There will in favor of the store-within-a-store format that was unheard of in the past. always be room for a broad range of juices for certain brands. Department stores are Indeed, while luxury is doing well, consumers catering to every budget and age, especially increasingly following a Harrods-like concept by are still price sensitive when it comes to young consumers. “Mass perfume will never offering a fragrance hall in which a larger edit fragrances, which can be seen in the increase fade. For young people who cannot afford is offered as well as a number of increasingly in sales of smaller sizes. (Although this trend Dior or Chanel there are superb fragrances specialist spaces such as Harrods’ Salon de and the rise in discounting are said to be due to from brands such as Yves Rocher,” affrms Parfums, which offers just 11 prestige counters in brands having raised their prices over the years). fragrance industry expert Chantal Roos. a single space. In addition, there is a consumer move towards 48 November-December 2015 - N°24 - BW Confidential