Is niche the notion that binds us all — beauty retailers, manufacturers, suppliers and customers? According to Mia Collins, general merchandise manager for beauty at Harrods Ltd., the answer is a resounding yes.
“You must have been living underneath a rock not to have noticed that niche brands have been one of the hottest trends in beauty,” said Collins to the audience. “In terms of launches and being a sales driver, we’ve already seen that the power of niche has been very well documented.”
Collins believes niche fragrance is one of the best examples of this, pointing to the retailer’s high-end fragrance area, dubbed the Salon de Parfums, intended to be the standard bearer for niche fragrance. The department, which bowed in October 2014, sells niche fragrances by brands such as Tom Ford, Kilian, Henry Jacques, Creed, Clive Christian and Roja Parfums in 11 boutiques on Harrods’ sixth floor. Both beauty advisers are specific to one brand, and what Collins calls “fragrance concierges” who can sell the entire floor are on staff.
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As well, the department includes bespoke perfume creation and personalization, including engraving bottles and caps and even adding gemstones.
In 2013 and 2014, Collins noted, roughly 500 niche fragrances a year were launched. “That’s almost double the number launched three years prior,” she said. “Therefore, the raw commercial appeal of niche cannot be doubted.” They also accounted for 30 percent of the new launches, she said.
Niche fragrances, Collins believes, require a special environment. Because niche and luxury are “natural bedfellows,” she said, Salon de Parfums made perfect sense to the retailer. About 70 percent of Harrods customers are between 20 and 50 years old, said Collins. “At Harrods, we are blessed with a customer who has the propensity to spend starts high and gets higher, rising by about 25 percent across those three 10-year age ranges [20-30, 30-40, 40-50]. We have a very international customer base — about 30 percent of our sales come from international tax-free consumers, and our top 20 customer countries include not only those in the Middle East and China, but also the U.S., Russia, Nigeria and Brazil. But even when a customer base is so diverse, there are always common touchpoints.”
The most important one, she believes, is that no matter what the age of the consumer, he or she is looking for a retail experience that goes beyond cash and wrap and allows for greater brand immersion and engagement. “And in a world where so much interaction takes place in the digital sphere, there’s little wonder why there’s so much hunger from customers to find out new ways to stand out from the crowd and express their individuality. This doesn’t just apply to the products they purchase, but also how they purchase them.”
The same expectations apply to retailers and brands, she added. When Harrods designed the Salon de Parfums, the objective was to combine luxury and exclusivity. Brands sought out were otherwise difficult to obtain and potentially only appealing to a small, specialized segment of the population, she said. “We had to elevate the way fragrances were showcased,” she said, noting that the department took its inspiration from fine jewelry. “Imagine as a consumer sitting, glass of Champagne in hand, in a space that looks more akin to your drawing room than it does any retail store,” she said. “And whilst you’re being educated, not just about the rarity of the ingredients used to compose your chosen scent, but the pedigree of the perfumer who orchestrated it all and how it can be uniquely yours. There’s actually very little need for marketing when your product has provenance, relevance and a history all of its own.”
Eight months in, Salon de Parfums is outpacing plan by double digits, the dwell-time can run into the hours, and for some brands, their personalized and bespoke scents are selling more than their ready-to-wear scents by a ratio of 2-to-1, said Collins.