Where, When, How: Close Future for the Industry

Let’s get right to the subject. Inside the nuanced world of beauty and personal care products, perfumes are at a critical crossroads. With ever-changing costs of living, consumers are re-evaluating their budgets and categorizing the “unnecessary” items accordingly. With such requirements in the perfume industry, radical changes can bring beneficial and fruitful inventions or become destructive if applied late or never. We’ve long been aware of the fact that the fragrance industry has a huge gap in renewing and adapting itself both on behalf of consumers and stabilizing its market share. The perfume industry needs innovations to stay relevant and captivating but how? The shift in consumer behavior is not just monetary. Consumers also look for sustainability, transparency, and ethical production. 

This is a call for brands to focus also on value, rather than prices alone. Industrial experts and analysts believe that the perfume industry must lead the way for others on the subjects of sustainability and transparency in the coming years. In that sense, the industry is not only responsible for meeting consumer demands but also for delivering innovative products that will hold up under economic pressure. In the past few years, the perfume market has been evolving under the instability of pandemic and economic fluctuations. These factors not only determine consumer behavior but also force the industry towards innovative approaches. From escapism to self-identification, perfumes create value on many different levels. 

According to a 2023 study, 60% of consumers have come to see perfumes as a kind of ‘sensory refuge’. On the other hand, if economic hardships reinforce perfumes to further become a sensory refuge, perfume producers should come up with ways to raise this “sensory” value by creating one-of-a-kind innovations and sensations (According to the UK Fragrance Association’s 2023 report, consumers now tend to avoid common perfumes and look for uniqueness). That’s why in the coming years, with global warming and sustainability demands, the perfume industry’s only solution is to transform, with the help of science and technology of course. According to the World Sustainability Forum’s 2024 estimations, with the help of nanotechnology and bio-engineering, the carbon footprint of the perfume industry can be lowered by %25. Also with consumer’s demand on transparency, sustainability, and ethical production, it’s inevitable for producers to avoid responsibility. A 2022 Sustainable Brands Institute study shows that 68% of consumers want brands to show effort to reduce environmental impact. In that sense, the perfume market is expected to shift the prospects and values of not only inner dynamics but also consumers, making perfumes something more than personal care products. Mintel’s “The Future of Fragrance” report shows that consumers, primarily in Latin America, are shifting from high-priced eau de parfums to more affordable alternatives like body sprays, and from branded products to more budget-friendly options. Brands, wanting to keep their market share, respond with smaller or refillable packaging. Like Jo Malone, offering small-sized bottles for consumers on a budget who still prefer luxury products. Let’s continue with communication. During hard times, brands are expected to keep strong connections with buyers through the power of scents by creating positive experiences. And we have some successful examples like Aveda. The brand opens a new frontier with its “Chakra” series. With aromatherapy and Ayurveda-inspired sprays, it offers healing for different moods. Or, Le Labo keeps its authenticity with personalized perfumes. Byredo and Diptyque with their minimal designs and simple essences, target the inner self. And the list goes on... Even if the dynamics change, this secure communication area creates a shortcut for brands to define themselves. Moving on to another important subject: Change in consumer habits and rise of the product value and resilience. A USA study shows that 39% of consumers are open to buying perfumes they’ve never tried before if the scent is lasting. 

This opens a window of opportunities. Correlating the price and perfume longevity and creating formulas accordingly can help a brand stand out. This brings up the subject of perfume foundation. Foundations help perfume molecules stick better onto the skin which ends up making the perfume long-lasting. Another way to make a perfume lasting is by using high-quality essential oils. In the long term, lasting perfumes give consumers a sense of money’s worth and also help them identify with the scent, making it a part of their character and identity. Surely, not everyone wants to identify with the same scent. Younger consumers tend to use perfumes as a way of self-expression. Brands can benefit from this demand by educating consumers on different notes, meanings, and application methods. Which would help them lead the market in personalized perfumes. Scentbird is a membership-based perfume service providing customers with personalized olfactive experiences by analyzing customer profiles.

The perfume industry’s on the verge of a new dawn that will redefine the whole practice based on sustainability and technology. 10% of future perfume sales will not only be based on olfactive experience but will also be visual, physical, and overall sensual. But let’s talk about the foreseeable future. By the end of 2024, as high as 65% of perfume brands are expected to integrate artificial intelligence (AI) or machine learning (ML) technologies to their product development and customer interaction strategies. Applying the mentioned technologies is critical, both for personalized perfume development and sustainability. The use of blockchain technology within the fragrance industry is expected to increase by 50% which will provide one-of-a-kind transparency for the consumers. There’s also an upward trend towards investment for biotechnological developments for sustainable and ethical perfume production. By 2025, luxury perfume brands are expected to have embraced biotechnologically produced ingredients by 40% and lowered their carbon footprint by 30%. Aside from the scent itself, these innovations apply to many areas including packaging. Brands are expected to adapt to technologies from biodegradable material to refillable options by %45. Long story short; adaptability is a must. Swiftly and firmly...