How are online perfume sales performing in the Middle East? Online perfume sales have been rapidly growing in the Western world, but the Middle East has lagged a little in this respect. What do we think will happen in the future and how will this affect the local retail trade? In the Middle East we have some really impressive perfume retail stores. We are spoilt for choice by having access to all the world’s perfume brands in some beautiful locations. The Middle East is well known for its heavy consumption of perfume, as a result every brand wants to be seen here. Big international retail stores such as Galeries Lafayette and Bloomingdales have a presence, as well as Sephora and Harvey Nichols. Paris Gallery, the local luxury chain, has branches in all Middle Eastern key markets. Boutique niche brands also have their own stores in many of our flagship malls. Unfortunately the overheads of running a retail store in the Middle East are extremely high. The combination of high retail rents, plus ‘hidden government taxes’ make it a very expensive place to operate. Why do people prefer to buy perfume online? People often buy well known designer perfumes online to save money or time. The same perfumes can be up to double the price if you buy them in your local mall. Consequently it can be a huge saving and also extremely convenient to have a delivery to your home. It’s also an easy way to get hold of hard to find products which might not be stocked everywhere. Frequently we see people in the region who buy perfume online from online sites posting on forums in Facebook. They ask question such as if it’s safe to buy online or if the goods are really genuine. Fake or real perfume? Online perfume sales can be tricky, we don’t always know for sure what we are buying online. We don’t know if it is a very good fake from Turkey or China or if it is just a good bargain. The fake copying companies are now so good at copying that one might not ever know it’s a fake. Unless the purchaser knows the perfume character intimately and notices that it performs differently to the original. The perfume essence will generally undergo detailed chemical analysis. By tweaking the formulation the perfumer ensures that it matches the original as closely as possible. Great efforts go into ensuring that the packaging is identical. The biggest online portals often do not warehouse the majority of the items they sell on their portal. Therefore they are not able to physically check the item because they are shipped from different locations. Only the ones which the big online sites fulfil personally have this guarantee. For more statistical information about the progress of the Middle Eastern perfume market read the Beautyworld Middle East report. What is the future for retail if online perfume sales grow? There will always be a demand for retail stores where you can go and try a perfume and see how it smells, online stores can never provide this luxury. But will people buy it from that outlet after trialling it, will they just go and buy it online afterwards at a lower cost? How can retail stores encourage more purchase in store? There are a few main factors here I believe which can influence this : Understand client needs Better client service and understanding of client needs in store. Most staff in perfumery retailers do not have understand perfume well and don’t help clients to buy well. Sephora has tried to address this issue through the introduction of the Fragrance IQ machine in some of their stores. However, it doesn’t make up for a lack of well trained and knowledgeable sales staff. In the big luxury perfume stores store over zealous staff chase the customers. They are constantly spraying the client with irrelevant new perfumes with ‘try this’ and ‘try that’. This discourages many of us from entering those stores due to this frequent occurrence. Some clients need a bit of time to browse and think about their needs before interacting with a salesperson. For people who don’t enjoy the in store experience, online perfume sales can be a godsend. More promotions and offers to entice trial/ repeat purchase. Better loyalty schemes to keep clients loyal to the store. Most of the big stores have loyalty cards to collect data on consumers which allow the collection of precious consumer purchasing behavior. However, there is very little customer reward for shopping frequently at the same store and signing up to these loyalty schemes. A better overall experience More positive experience in store. More displays to make the essence of the brand more understandable. Merchandising and display in store which makes it easier to find the perfume you need. A more experiential approach to perfumes. If the experience is more positive and creative and gives a better understanding of the perfume, people will not mind paying more compared to online. More fun and play and creativity is required instead of rows of displays of perfumes on shelves in store according to the designer brand name. The use of Artificial Intelligence and other technology could help to bring brands alive and make the experience more immersive.. An alternative way to sell Alternative types of stores If more stores were in different types of locations, not in high rent malls, then the shops could afford to sell perfumes at a lower price. This would really disrupt the market and slow online perfume sales. Could this be a way forward – how about setting up perfume stores in warehouse units with big space. This could enable a theatrical, immersive experiences which explain the essence of the brand more clearly? We need a new way of thinking and doing things if retail stores want to be more relevant and to addmore value to the younger consumers who are more cynical towards big brands. Conclusions So do we know […]
How online perfume sales affect retail in the Middle East
