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Jo Malone is producing perfume paintbrushes at her new label Jo Loves; Diptyque has perfume bracelets; Glossier has relaunched its famous You scent in solid form; and Marc Jacobs’s bestseller Daisy is now available in single-use capsules. As competition in the fragrance market ramps up, brands are getting experimental with formats to differentiate.
Valued at $64.4 billion in 2023 and predicted to grow by 7 per cent to $68.9 billion in 2024, according to Euromonitor, the fragrance industry is flying. However, with fierce competition between heritage brands like Dior and Chanel, challengers like Byredo and Le Labo, and other new young players, the market is saturated.
It’s high time for a shake-up, says Greg Le Tocq, co-founder of budding fragrance brand Diem, who notes that while makeup and skincare has transformed over the last decade, fragrance has barely evolved in its 4,000-year-plus history. Full-size spray bottles of eau de toilette or eau de parfum are still the standard, lining the shelves (or webpages) of beauty retailers and airport duty-free. “Elsewhere in the beauty space, there has been a big shift to ensure packaging elements are made more sustainably, with many refillable product categories emerging in the market,” says Sophie Beaumont Willis, founder of solid fragrance brand Tenth Muse. “Fragrance, despite it being a [multi-]billion-pound industry, has seen less of this innovation.”
According to a Mintel study carried out in 2023, 63 per cent of perfume consumers pick products based on scent rather than format. However, 56 per cent of those surveyed would like more than just the standard spray bottles to choose from. “There will always be a market for spray perfume, but we know consumers are looking for new and innovative fragrance products and formats,” says Malone, perfumer and founder of Jo Loves and previously namesake label Jo Malone (now operated by Estée Lauder). When trying to stand out in an oversaturated market, she adds, selling great scents alone is not enough to command attention.
“We’re seeing notable shifts within the fragrance industry,” says Sophie Attwood, founder and MD of beauty PR and strategy firm SA Communications. “This change reflects a visible and growing demand for convenience, sustainability and experiential consumption among consumers… prompting brands to explore novel formats to stand out in a crowded market.”
Younger consumers are driving this shift. “Gen Z are challenging us to look at fragrance in different ways, their appetite for creativity and being part of the creation of their products is getting stronger and stronger,” says Malone.
Diem founder Le Tocq shares a similar finding. The brand encourages new customers to take a quiz and order a ‘discovery set’ of fragrance testers. This concept has proven popular with the trend-seeking Gen Z consumer. “The older demographic traditionally has the fragrance that they love, and they are loyal to that. What’s exciting about the younger market is that the data is telling us they want to create their fragrance wardrobes, they want to try new things, they want to be at the forefront of what’s new and exciting,” says Le Tocq. “However, they are much harder to market to, which makes it much more of a challenge.”
New formats
Fresh fragrance formats have seen increased consumer attention over the past year, according to beauty trend analysis platform Spate. Searches for “roll-on perfumes” are up 63.1 per cent, and “solid perfumes” up 51.8 per cent.
“Solid perfume aims to modernise how we buy and wear fragrance,” says Beaumont Willis. “It’s perfect for anyone who loves to take their scent with them on the go and wants a more natural alternative to traditional spray perfume; they can be also be layered with sprays,” she adds, noting they work well as part of the trending perfume-layering technique (wearing multiple scents at once).
According to Euromonitor, fragrances incorporating features of wellness, sustainability, personalisation and inclusivity are creating more value for consumers, with digitalisation having the current greatest influence. New formats leaning into these areas can offer a point of difference, compared to standard spray bottles.
Refillable bottles are also gaining popularity, says Aishwarya Rajpara, senior research analyst at Euromonitor. “Leading companies are not just limiting the scope of this trend to production cycles, but are also expanding to their retail partners.” In 2023, L’Oréal strategised to expand its refillable fragrance range by partnering with The Perfume Shop to set up a multi-brand fragrance-refill station in its UK-based stores, she adds.
Diem’s discovery sets of miniature fragrances, which focus on both personalisation and digitisation, sold thousands of units when first launched through an invite-only programme in November, and sales are improving each week. The discovery sets receive 1,600 average monthly searches in the US, growing 74.1 per cent since last year, per Spate. More widely, Mintel highlights fragrance discovery as a key aspect of success for fragrance businesses.
Communicating innovation
Alongside creating these new formats comes the need to accurately convey how and why they work to the consumer. “Innovation is always key, but I’d suggest that this change is about something bigger than tweaking product formulations. We’re asking brands to add further value, and ultimately a story, to their offering,” adds Attwood. “Consumers aren’t purchasing capsules because they are new, they’re buying them because they offer value to that consumer with regard to sustainability. They’re buying discovery sets because it means they can experience different scents in a risk-free way, learning more about themselves in doing so.”
This isn’t always easy. Nour Ibrahim, founder of new fragrance brand Bleu Nour centred around the rollerball, says consumer response was positive from the get-go. “The hardest part was getting retailers on board as they see this unconventional format as a risk, and they can’t perceive it as innovation,” he says.
Le Tocq argues that, rather than posing a risk, new formats offer fresh ways to engage customers. Brands need to focus on quality over quantity, he adds. “It’s about building the credibility of existing ranges, rather than simply launching another fragrance and hoping that it sticks.”
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