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What Does the Story of Fragrance Smell Like?
A publication of It's A Working Title LLC
This weekly publication focuses on how business and economics trends, technology, and the drive for sustainability impact the global luxury, fashion, and experience economy industries. Prepared by the staff of content strategy agency and think tank It’s a Working Title LLC, each week’s issue provides a summary of recent trends across the globe and a leader that conducts a deeper dive into content strategy.
This week’s contents
Leader - What Does the Story of Fragrance Smell Like?
Fragrance is a fascinating case study in narrative marketing, embodying the strength of brand storytelling and content strategy to sell scent across anosmiatic digital platforms. Although the perfume industry is deeply steeped in a long history of hypersexualized, gendered approaches to branding and marketing, fragrance and fragrance marketing are undergoing a quiet revolution. This opens the door for new ways to reach consumers and new stories to tell them.
This week, It’s A Working Title LLC had the opportunity to guest lecture at the Savannah College of Art and Design (SCAD) in Atlanta for a course on fragrance marketing to a mixed group of graduate and undergraduate students. Our topic was “Narrative Marketing for Fragrance: How Do You Sell the Ephemeral?”
As we told the SCAD students, the fragrance industry at its surface seems like it should be a land of synaesthetic wonders. And to a point it is, but fragrance is also a compelling, complex market that is rapidly growing and moves with its own currents, often against the flow of the beauty industry as a whole.
Scent is Unique
To start, the business of fragrance is booming. The market will increase by a third in the next three years: from $45 bn in 2021 to $60 bn by 2024. Contrary to initial expectations, the fragrance sector even grew during the pandemic despite the limitations on IRL sales. In previous recessions, we had the “lipstick index”, but during the recession we had the “fragrance index” as this affordable luxury has a transportive effect.
From a brand and product perspective, the fragrance industry is evolving, as a recent article in Harper’s Bazaar nicely explores. Yet, fragrance presents a unique problem for brand marketers due to the ephemeral nature of the product. Unlike almost any other luxury beauty product, except possibly for travel, the major goal of marketers has to be to get consumers to sample the product in a physical space. It is hard to convey what is so great about a fragrance through marketing alone (and this is reflected in those low e-commerce sales numbers), though much has been made of the strong digital sales of fragrance during the pandemic and there is now such a thing as perfumes of the Metaverse.
What Fragrance Stories Sell?
When it comes to storytelling, fragrance marketing is traditionally hypersexualized, gendered, and fantastic. Many adverts targeted to women adopt a storytelling approach that centers around the female as an object of a man’s desire or fantasy, which, even inasmuch as it purports to elevate women, ends up minimizing them at best and objectifying them at worst. On the reverse, adverts for men portray a roguish character doing specific activities, like riding a horse in a desert or driving a boat near a beautiful woman, which is designed to inspire wearers to an unattainable stereotype of maleness.
To illustrate with a scene from fiction which resonates with reality, consider a scene in the Netflix show “Emily in Paris” season 1, episode 3 (“Sexy or Sexist?”) where Emily balks at what she feels is a sexist perfume advert from Maison Lavaux. In the advert, a model walks naked across a bridge while well-dressed men in suits ogle her. She then turns into a bird. Antoine, the perfumer, tells Emily that the advert empowers the woman in the ad because it is her dream, her fantasy. Emily retorts that the advert is in fact centered around the male gaze and that the woman is being objectified.
The fictitious Maison Lavaux advert embodies a good chunk of celebrity-driven perfume advertising targeted to women. These adverts often feature major celebrities like Charlize Theron or Natalie Portman and have such a ludicrously disjointed approach to narrative that you wonder if you are, in fact, being trolled.
To look at the case of fragrance storytelling for men, one familiar fragrance advert that embodies the idiosyncrasies of the market is Johnny Depp playing guitars in commercials for Dior’s Sauvage line. Though Dior has had a scent with this name since 1996, the Johnny Depp version launched with enormous controversy in 2015 and it has remained enmeshed in controversy ever since. Critics have accused Dior of cultural appropriation by launching the scent with commercials set in Southeastern Utah that featured Native Americans. Others have discussed problems with the scent’s name as potentially referencing colonialism. And, of course, none of this counts the controversy surrounding the scent due to Depp himself.
And yet, Sauvage is the biggest selling scent in the world, making Dior $4.5 million in revenue every day at $160 a bottle. A bottle was sold every 3 seconds in 2021. And, after the Depp-Amber Heard case, Sauvage sales have increased about 1900 percent and Depp, who was slightly sidelined during the trial, inked a multi-year deal with Dior Beauty afterwards. Though not all of these, shall we say, outrageous events, were part of the marketing plan, Dior benefitted from them.
Fragrance Brand Storytelling is Evolving
Coming out of the pandemic, however, the story of the fragrance industry itself has begun to change. The market now includes a new generation of brands for which the idea of scent is not about sex or romance but rather about self care, sustainability, and moving beyond old notions of gendered norms.
Many fragrance brands now have a holistic focus on fragrance for self-care or self-improvement, building on the health and wellness trend. Marketing fragrance as something that shoppers should buy for themselves allowed brands to shift messaging inwards, focusing on the mental and physical benefits of scent–a message that apparently deeply resonated during the pandemic. Also, the increase in demand for personalization has produced a range of innovative approaches from crowd-sourced seasonal scents to the use of natural scents and aromatherapy that will react with your body’s natural biochemistry to produce a truly “signature scent.”
Another shift is a new emphasis on sustainability, which is a must in production and now marketing. This is a challenge and an opportunity. It is a balancing act between adopting sustainable practices, such as the increased use of upcycled ingredients or reusable packages, while maintaining positive, good-for-the-environment messaging that is not brand diluting.
Finally, gender neutral fragrances are on the rise (again). Over 50 percent of Gen Z-ers believe gender labels are antiquated, which has fed growth in a new class of perfumes. While CK ONE (one of the original unisex perfumes) and other gender-neutral scents stick to citrus notes, some brands like Boy Smells are embracing stereotypically feminine fragrances like rose and selling them as gender neutral or even mixing gendered scents like rose and musk. Of course, gender norms also affect product display and discovery. Several Ulta Stores now categorize fragrances by brand, rather than gender.
Narrative Marketing for Fragrance Works
In spite of an evolving market, hyper-sexualized, rigidly-gendered scent still sells. But, so do more holistic, gender-neutral fragrances. The key to selling fragrance boils down to the age-old tool in a brand’s toolkit: brand storytelling.
To come back to the question we posed to the SCAD students: How do you sell the ephemeral? Fragrance presents a unique challenge for digital marketing because you cannot experience the actual product. When it comes to beauty, particularly fragrance, it is about appealing to the five senses through sight and sound. While marketers love to talk about the value of evoking a mood through advertising, it really is about brands making an emotional connection with consumers.
In fragrance, as in all fashion and luxury, narrative marketing is about inspiration and aspiration. Your content needs to inspire action. Consumers need to feel an urge to learn more, order your product, or find it in person. Consumers also need to feel a sense of shared or aspirational value about your brand.
As consumers, we all know that watching Charlize Theron emerge from a golden pool is a deliberate play on her celebrity status to sell perfume and not a well-crafted narrative. Yet, this type of brand storytelling sticks around, partly because we aspire to the level of glamor in the commercial but also because we love to hate it and it has always been around.
Business & Economics
As we await luxury brands’ Q3 earnings reports early next month, a worldwide retail survey shows that inflation is denting margins but e-commerce and web3 investments continue to grow. A survey produced by Havas Commerce and released at Paris Retail Week during September 20–23 found that retailers around the world are being heavily impacted by weaker consumer spending and rising prices. The survey of 285 retailers, entitled “Understanding the changes of retail in a world in crisis,” found 93 percent have been impacted by inflation, with 89 percent responding by raising prices, 67 percent had reduced margins, and almost half chose to freeze or reduce advertising and media investments. Yet, these challenges are diminishing investments across the board as half of firm respondents intend to increase spending in digital and e-commerce capabilities, including web3 and Metaverse applications. Though Q2 was strong for luxury brands, even while mid-market and big box players struggled, this survey could well point to some trends to look out for in Q3 and Q4 and into 2023.
Chanel completes creation of UK-based holding company. This week saw the completion of corporate reorganization that started in 2018 as Chanel brought all of its companies under a Chanel Ltd. holding company to be registered in the UK. The quintessential French brand’s decision to, at least in some senses, become a British company is a bit surprising given the UK decision to vacate its European Union membership, yet is aligned with a strategy to integrate a number of supporting functions together in a market with a central time zone and English as a native language. Chanel Ltd is owned by the Wertheimer family’s holding company, Litor.
In step with residential and commercial property markets around the world, luxury home sales are experiencing a steep decline and rising inventories. A report released by Redfin this month found that luxury home sales in the U.S. tumbled to their steepest decline since 2012, falling by almost a third from last year’s levels for the three months ending August 2022. This is ten percentage points worse than we saw during the pandemic and outpaces the 20 percent decline reported by non-luxury residential properties. The economic environment has been blamed as rising interest rates make loans more costly. Even for those luxury properties bought in cash, the volatility of the global economy is leading to delayed purchases. On the bright side, homes that do sell are fetching strong prices as median sale prices for luxury homes grew over 10 percent. The shortage of luxury inventory that helped drive prices during the pandemic is easing. Inventories of luxury homes are up around 40 percent from a record low of roughly 121,000 earlier this year.
With Q3 earnings season on the horizon, the relentlessly weakening exchange rates in Europe will create opportunities and costs. The value of the Euro and British Pound Sterling have crumbled against the U.S. dollar this year. During H1 2022, the Euro lost 8.7 percent against the USD and another 6.7 percent so far in Q3 with the combined effect of pushing the EURUSD rate below parity for the first time in 20 years. Sterling has fared worse, losing 9.6 percent in H1 and a further 10 percent in Q3 and it has also lost almost 6 percent of its value against the Euro during the period of January to late September. The impact of the war in Ukraine, weakening consumer demand, and increased interest rate differentials have combined to push down demand for European currencies. This will be of note as we look ahead to Q3 earnings reports in the next few weeks. Though major brands do smooth out FX fluctuations to a degree through hedging instruments, the magnitude of these weakening exchange rates may help continue to support earnings of Europe’s major brands by boosting imports. LVMH Moët Hennessy Louis Vuitton saw its H1 2022 fashion and leather goods sales rise 24 percent on a constant currency while the final published result was a stronger 31 percent gain to 18.1 billion euros. Similarly, L’Oréal noted that consolidated sales amounted to 18.4 billion euros, up by 20.9 percent on a reported basis, with foreign exchange having a strong positive 7 percent impact. However, weakening exchange rates will also raise costs by making imported inputs needed for production more expensive.
On September 22, Vogue Business hosted its Business Metaverse Atelier, which was created in partnership with Epic Games and hosted on Metaverse platform Journee. The event allowed participants to create an avatar and explore beautifully rendered world filled with the opportunity to hear designers speak and present their creations. For example, attendees nevertheless had a chance to see a hologram interview with designer Gary James McQueen, narrated video from digital-native luxury fashion house Auroboros with selections from its Biomimicry collection, and audio from The Fabricant co-founder and creative director Amber Jae Slooten, who talked about the celebrated “Iridescence” dress, the first recorded sale of a fashion NFT. It’s A Working Title authored a review of the event from a content strategy perspective. These type of immersive tech would benefit from the lens and best practices of content strategy to keep brand messaging consistent, engage audiences, and improve the overall user experience:
Lesson 1: The Metaverse is multi-dimensional, experiential content.
Whether you call it an environment, experience, or event, visiting a Metaverse is at its core multi-dimensional, experiential content. Without this understanding, your brand may lose out on important opportunities to engage with target audiences in meaningful ways.
Lesson 2: Articulate the “why” behind your Metaverse event before people even walk in the door.
Whether the experience in question is content on your website or immersive, multi-sensory environments like the Metaverse, establishing a value proposition for your target audiences with clearly defined calls-to-action at important touchpoints in the user journey is imperative. To put it simply, if your users don’t know the purpose or impetus behind your content or event and cannot easily figure out what they need to do, then they will lose interest quickly.
Lesson 3: The Metaverse needs vision and strategy but has endless storytelling potential.
Critics like to say the “Metaverse doesn’t exist” because “it is not a singular environment like the internet.” Further, they argue that the Metaverse lacks clear use cases, especially for fashion and luxury brands looking to market and sell products. “Virtual experiences don’t sell handbags,” someone informed us during consumer research for a Metaverse retail strategy report we authored for PSFK. Right now, the Metaverse, along with its cousin Web 3.0, are not a singular shared platform. They are a motley collection of platforms, ideas, and experiences. Right now, the Metaverse is another channel for your brand, another opportunity to engage with—and learn from and about—consumers.
As consumers’ preference for sustainable fabrics and practices continues to ramp up, one small solution may come in the form of digital labels. With a number of well publicized cases of “greenwashing,” consumers are justifiably struggling with how to assess the sustainability of the clothes they buy. As a small step in that direction, apparel branding and tags manufacturing Avery Dennis and social impact business The R Collective have partnered to produce a line of clothes, termed Revival, made from rescued fabrics with QR code tags that help educate consumers on some sustainability dimensions. The tags provide information on the clothing and contain sustainability messaging.This line is a part of these organizations’ #caretobethechange partnership, which seeks to educate consumers on the importance of digital labeling for garment circularity.
The $250 million Fashion Climate Fund run by the Apparel Impact Institute (Aii) to improve sustainability in the fashion industry attracts new investors. The catalytic fund was created in 2022 to identify, fund, scale, and measure verified impact solutions to decarbonize supply chains in the global fashion industry. This month PVH Corp Foundation–which owns Tommy Hilfiger and Calvin Klein–will become the fund’s latest investor, joining Lululemon, H&M Group, and the Schmidt Family Foundation with each contributing $10 million.