China set to become world's second-largest prestige perfumery market by 2025
Within the next three years, China is expected to become the world's second-largest prestige perfumery market, just behind the USA. The prediction has been made by Japanese scent and aroma manufacturer Takasago, in a study entitled ‘China: the future Eldorado for fragrance’.
In 2020 and 2021, years that were greatly affected by the Covid-19 pandemic, China, currently celebrating, like most of Asia, the lunar new year and the year of the water tiger, established itself as the genuine growth driver of the global prestige perfumery market. In 2020, the Chinese market’s sales grew by 15%, and in 2021 they grew by 30%, while only 5% of the population uses fragrances.
A consumption spurt that was largely led by individuals below the age of 40, the same who account for 80% of the country's luxury goods expenditure. More specifically, by Millennial consumers, the 150 million digital-native individuals born between 1995 and 2010. According to Takasago, these consumers are characterised as “only children with high purchasing power” who are strongly influenced by opinion leaders, especially internet influencers.
Dior and Chanel are among the most popular brands, cornering a 10% share of the market, though Chinese consumers are increasingly attracted by niche brands, like Jo Malone London, which according to Takasago has three fragrances in the women's perfume top 20.
But local brands are increasingly successful too, and currently account for a 56% share of the market. “[They] are more reactive and digital-savvy, and also tap their knowledge of local culture,” said the study.
In 2017, Scent Library, a Chinese perfume brand in which Puig bought a stake in September 2021, launched the LBK Water fragrance. The perfume, whose scent is a replica of the smell of rice being cooked, sold one million bottles in a year. In 2019, the White Rabbit perfume, named after a type of sweets from the Mao era, enjoyed the same success.
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