Brand expert Martin. Martin Lindstrom points out in “Buying the Senses, Believing in the Brand”,
75% of human emotions are generated by the sense of smell. Only 50% of a person’s memory of a photograph is left after three months, but the accuracy of recalling the smell is as high as 65%.
Why does the taste make us remember it so strongly?
This is because the part of the brain that controls the sense of smell is adjacent to the limbic system of the brain, which is responsible for emotions, and emotions are closely linked to the storage of memories. Of all the senses, the “smell” response is the most immediate, primitive, and indescribable.
The olfactory economy – the trend of the international fragrance market
The global perfume market size exceeds 50 billion US dollars, and the megatrend leads the development of the industry
According to Euromonitor International, the global perfume market reached $51 billion in 2018, with a growth rate of 2.4%. The U.S. and Brazil are the two largest markets in the world.
As the global perfume market crosses the $50 billion mark, a new foundation has been laid for the perfume category, which will open up new areas. At the same time, more niche brands are entering the mainstream market and becoming well-known brands in dynamic high-end segments, providing more impetus for market growth. In addition, perfume products bring a new, creative and experiential element to physical stores.
At present, the global perfume market presents the following 4 major development trends:
Trend 1: High-end perfume brands are growing in the hair product category
Estée Lauder acquires fragrance brands such as Le Labo and Frédéric Malle, Puig acquires Penhaligon’s and L’Artisan Parfumeur. L’Oréal intervenes in the acquisition of Atelier Cologne. LVMH acquires the French Maison Francis Kurkdjian, a French brand that rapidly expands its stores around the world.
The latest 2019 financial reports of these companies show that they have all reported outstanding growth due to the addition of luxury fragrances and fragrances to the group. Estee Lauder’s most successful fragrance brand is Jo Malone. Jo Malone began to show its strong growth momentum when it became the number one fragrance brand in Harrods, a department store in the UK.
For department stores and specialty stores, the segment of high-end brands has now proven to be very lucrative, with sales expanding every year.
Trend 2: Create more immersive experiences for consumers
With the rapid rise of e-commerce and online shopping, sales behavior has changed, and the closure rate of physical stores has reached a record high.
Sensory experience and consumer engagement are becoming more and more important when selling products, which is the most trendy experiential marketing at the moment. “Consumers are increasingly geared towards the experience of spending money on a product, so using the experience to provide a little extra service in retail is ideal and probably becomes very important.”
Trend 3: Environmental protection trend: simple packaging to reduce unnecessary waste
High-end perfumes began to plan to reduce unnecessary luxury packaging, and returned to product packaging to bring added value to consumer products.
For Christmas 2018, Miller Harris launched a gift wrapping program with 100% silk twill scarves instead of plastic and cartons, making the packaging a covetable and reusable product. The launch of this product has been well received, and the brand is currently offering silk scarf packaging to all customers who purchase perfumes.
Trend 4: Genderless perfumes have a bright future
50% of U.S. millennials don’t believe gender exists, and about 70% of those surveyed don’t believe that gender defines a person. The shift to unisex fragrances will continue in the future, as consumers now believe they don’t need to identify themselves by gender, and millennials and Gen Z are more likely to reject gender definitions.
More brands will adopt this unisex approach in the future. Going forward, the new gendering trend will impact every aspect of the fragrance industry. These changes will also bring more innovative value to the concept and product definition of perfume products, and may even lead to new forms.
Olfactory economy – domestic fragrance market trend
Based on the international market trend, it corresponds to Taiwan’s fragrance market; In 2018, compared with 2017, it increased by 4.6% and its annual turnover reached 200 billion yuan, of which perfume fragrance increased by 9.12%. Growing in tandem with the international beauty market. This wave of growth on the consumer side is due to the change of the overall living environment, and the increase in people’s habits of paying attention to personalized taste life and using fragrance products, which can be widely accepted by consumers in the home environment, which touches the vigorous development of the fragrance industry.
This wave of fragrance trend continues to heat up and the introduction of cultural and artistic industries, crossing the functionality of fragrance essential oils and upgrading to the perceptual sense of smell and agility of fragrance aesthetic concepts, producing a new type of cultural and creative fragrance industry, as well as cultural and creative tourism factories such as aroma museums.
Olfactory economy – the application of life aesthetics in commercial space
When the flexibility of visual merchandising is exhausted, the sense of smell is the new niche for manufacturers to compete for. In the past, scent appeals were the preserve of perfumes,
Nowadays, enterprises, brands, and spaces are all developing opportunities from the perspective of smell.
The five-star hotel has been very extensive in commercial application, and the five-star hotel has been the basic equipment for the taste of the space and the Xiangfang gift center, which extends from the public space of the welcome hall and the elevator to the bathing equipment of the VIP guest room, creating the unique aroma of the brand hotel and enhancing the brand recognition of consumers; W Hotel conveys the fragrance of happiness, and Taipei Oriental Mandarin uses Taiwan’s unique cypress as the hotel fragrance to convey the core of the local culture of the chain hotel brand.
Looking to the future
The global fragrance market is expected to be worth an estimated $70 billion in 2022, and most of its growth will continue to come from niche brands and artisanal luxury fragrance brands. Brands must ensure that they are always paying attention to the consumer’s eyeballs and looking for more unique concepts. In addition, as the cost of sourcing high-quality ingredients continues to rise, brands must find the right balance between price, quality and uniqueness, combined with a strong marketing strategy to attract consumers and build a better brand image.
Note: The above relevant data are available;
Quote from Wikipedia/Industrial Economic Statistics Newsletter/UrCosme (@cosme TAIWAN)
