Dollars and Scents in the Home Fragrance Category  5/17/2017

Shortly after moving into my new apartment last year, a friend of mine, Andrea, gave me as a housewarming gift a wax melt warmer and a variety of scented wax melts. Andrea is a consultant for Scentsy, a company that markets home fragrance products via a direct sales force – products such as wax melts infused with natural and essential oils, as well as hand-crafted decorative warmers that use a light bulb or heat plate to safely warm the wax.

The gift was Scentsy’s Edison Lamp – a very cool warmer in which a glass encases an Edison light bulb – one of those in which you can see the filament glowing (see photo) – and a variety of scented wax melts, including Vanilla Orchid, Black Raspberry Vanilla, and Dark Harbor (which is my favorite). I placed it on a table in my dining room, which is in the middle of my apartment. The fragrances were amazing, generated a lot of positive comments from guests, and soon after I ordered another warmer for my living room, and a mini warmer for my home office, so that you experience a different scent as you make your way through my apartment.

Turns out, these warmers are the first thing guests notice upon entering my apartment. First they are hit with the fragrance, and that draws them to the warmers, which they always fall in love with (then ask for Andrea’s info shortly after). And while I do have my favorite scents, there are so many different varieties that I typically have Andrea choose some random ones for me to try out whenever I place an order.

So it came as no surprise when I learned that home fragrances, warmers and diffusers were all the buzz at ECRM’s recent Home & Gift EPPS. Indeed, according to NPD, fragrance diffusers saw tremendous growth for the 12 months ended April 2016, with a 36 percent increase in dollar sales, and 27 percent increase in unit sales over the previous 12 months. Candles, the largest segment within home scents, are still going strong, with an 18 percent increase in dollar sales and 15 percent increase in unit sales during that same time period.

Interestingly, some of the trends that ECRM is seeing across its other categories – particularly among Gen Xers like myself and Millenials – are also driving sales and product innovation in the fragrance category. Here are some of these trends:

Artisanal-Made: In the same way that consumers are buying hand-made soaps and authentic specialty foods, they are also looking for uniquely crafted home décor products including warmers, diffusers and candles that are well-crafted and designed.

Wellness: The aromatherapy aspects of home fragrances – the use of plant materials and aromatic plant oils, including essential oils, and other aroma compounds for improving psychological or physical well-being – are also helping drive demand for these products, particularly among Millennials, who increasingly seek more natural health alternatives. They are also looking for candles and wax with natural ingredients and that are sourced responsibly.

The quest for new and exotic: In the same way that consumers are making their diets more interesting with exotic spices in their foods, they are seeking exotic scents for their homes. This is particularly evident in the variety of scents, and unique mixes of scents now available to consumers. As we’re seeing in the food industry, an increasing number of products are available with contrasting flavors – like sweet candy mixed with spicy jalapeno – blended together. The same is happening with fragrances. “To stay relevant and exotically interesting,” according to the National Candle Association, [the basic fruits that have dominated the industry] must be paired with both unusual berries like acai or goji and richer and darker notes like bourbon, sandalwood, juniper berries, ginger, coffee and similar scents.”

Seasonality: The home fragrance category offers great opportunity for seasonality via fragrances aimed at different times of the year, like spicy notes for the holiday season, or light scents for the summer.

Some recommendations for getting the most from your home fragrance marketing:

  • Fragrance as wellness: Leverage the wellness trend among consumers by touting the benefits of aromatherapy, and how it can fit into a healthy lifestyle. If your products are made from natural or organic ingredients, or in an environmentally-friendly/sustainable way, be sure to call this out in your marketing as well.
  • Limited time and exclusive offers: As we saw with the Starbucks Unicorn Frappuccino, having a limited-time offer can help to generate buzz and spike demand. Scentsy does a great job of engaging its customers in this area by running limited time themed offers (such as its current “Havana – Be There in 5,” campaign of Cuba-inspired scents. They also regularly – and intentionally -- discontinue select wax melt bars, then hold a social media “Bring Back my Bar,” contest, in which customers vote on which discontinued scent that they want to bring back. These types of campaigns drive tremendous engagement on social media. Obviously, the seasonality of some fragrances (think cinnamon and spice) lends itself to this as well.
  • Market to new home owners or realtors: My apartment building was recently sold, and the various brokers and potential buyers all commented on the warmers and fragrances, some even asking for Andrea’s information so that they can offer products to their client base of new renters/home owners. This is a great audience to tap, as they are in full home décor purchasing mode. Advertise your home fragrance products on their websites or social media pages.
  • Subscription box programs: Home fragrance is perfect for subscription box programs. A great way to market home fragrances – since it’s such a sensory experience with so many scent varieties – is to get samples in consumers’ hands. Start off the program with a warmer or diffuser (or candle or incense holder, depending on your home fragrance product) and then have them sign up for regular samples, with the ability to purchase full-size packages on your website.
With a little creativity and a marketing push, your home fragrance category sales will end up smelling like a rose (or Jasmine, or Moss, or Salted Caramel, or Tea Notes…)

Joseph Tarnowski

VP Content

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