Niche perfumes, home scents make the big bucks
According to data from major department stores, perfume brands have seen solid double-digit growth in sales in recent years thanks to robust demand for niche perfume brands like Jo Malone, Byredo and Diptyque.
At Lotte Department Store, perfume sales grew 36 percent in 2013 and 30 percent in 2014. For the first quarter of this year, sales jumped 26 percent.
In contrast, sales of overall cosmetics fell 2.4 percent in 2013 and saw comparatively meager 3.1 percent and 2.5 percent growth in 2014 and the first quarter of this year, respectively.
Niche perfume brands focus on originality of the scent and use higher concentrations of extracts from more natural ingredients, using some unlikely ingredients like cinnamon, red pepper and salt. Their scent is unique and also lasts longer than regular perfumes manufactured by cosmetic giants like Lancome or licensed perfume brands such as Calvin Klein.
Consumers are also drawn to unique histories that often go with niche perfume brands. Santa Maria Novella’s classic SM Novella cologne, for instance, was created in the 16th century for Catherine De Medici, who brought her personal perfume maker with her when she went to France to marry Henry II. She gave “Aqua Della Regina” or water of the queen to her closest friends in France, which was commercialized as a cologne. The Italian perfume maker says it uses the same formula used at the time of the French queen.
“Our perfumes are hand-formulated in Florence as they have been for many hundreds of years. And our customers are quite taken with their romance and history,” said a clerk at Santa Maria Novella at Shinsegae’s central Seoul branch.
Niche perfumes tend to be pricier, with a 100-milliliter (3.4-ounce) bottle of Santa Maria Novella selling for 198,000 won ($181) and 100 milliliters of Jo Malone’s signature Blackberry & Bay perfume selling for 169,000 won. In contrast, a 100-mililiter bottle of Lancome’s Miracle sells for 138,000 won, while Calvin Klein’s Eternity perfume for women sells for around 58,000 won.
But higher price tags seem to only excite shoppers.
“Niche perfume is a highly personalized luxury item. For sophisticated consumers, scent is part of what defines you as a person,” said Choi In-jin, who is in charge of cosmetics merchandising at Shinsegae.
“More of our consumers want to express themselves with unique scents. Niche perfume is a little luxury for you at prices that are just a fraction of what it would cost to buy other luxury brand accessories,” she added.
Jo Malone, for instance, understood sophisticated consumers’ need for a personalized approach early on and has offered a “tailor your scent” consultation for new customers.
At its first Korea boutique in Hanam-dong, an ultra-affluent neighborhood in central Seoul, Jo Malone offers its signature line of perfumes and “fragrance combining” to help customers find their own individual scent through mixing different perfumes.
As demand for niche perfumes like Jo Malone continues to grow robustly, local department stores and boutiques are expanding their niche perfume offerings.
On the first floor of Shinsegae’s main store in central Seoul, Byredo, a Stockholm-based perfume maker, Paris-based Diptyque and Hermes’ perfume line have taken up residence most recently. Santa Maria Novella and Jo Malone are also located on the main floor, right across from the busy side entrance.
In March, Lotte Department Store opened a specialty boutique carrying niche perfume brands at its Bundang branch in Gyeonggi.
“There is something fresh, more natural, and subtly different about niche perfume scents,” said Gina Ryu, a 35-year old restaurant owner who describes herself as a perfume collector.
“For one, I do not grow tired of [niche perfumes] so easily. I think it has to do with their more natural base. The scent surrounds you but in a very pleasant and natural way, like a bouquet of fresh-picked flowers. It is not overwhelming,” she added.
And more Korean consumers not only want be scented nicely but also be surrounded by nice scents at home, industry insiders say.
Premium home fragrances, scented candles and diffusers are displayed more prominently at department stores as well.
“The so-called cocooning - enjoying quiet, restful time at home - is growing popular as more people want to get away from the stresses of daily life. A desire to have your home smell nice with a very natural, stress-reducing scent has increased exponentially in recent years,” according to Lotte spokeswoman Ha Min-ji.
Sales of diffusers and home fragrance items at Lotte have risen more than 50 percent annually in the past three years from 2012 to 2014.
And to keep up with the demand, Lotte recently opened a “Candle & Diffuser” specialty store in the newly renovated housewares and home accessories section at its Jamsil branch in southeastern Seoul.
The store carries more than 15 different home fragrance brands including Woodwick (scented candles whose wicks flicker) and Queen Bee Candle (made with beeswax).
“The concept of home fragrances has completely changed,” Lotte’s Ha said. “Previously they were used just to cover up bad smells. But consumers today want to be surrounded by scent to feel good and to feel less stressed.”
BY PARK JUNG-YOUN [firstname.lastname@example.org]