Fragrance firms smell sweet success in hotels

The fragrance market is becoming more popular in China as the use of such products in hotels, as a segmented business, gains new growth momentum.

Hotel fragrances refer to aromatherapy products used in hotels to help residents relax their bodies and minds, with another objective being to connect various fragrances with hotel brands themselves so as to leave deep and pleasant impressions on consumers' olfactory system — and hopefully encourage brand loyalty and repeat stays.

Data from Beijing-based market consultancy gonyn.com showed that China's hotel fragrance market totaled 1.5 billion yuan ($208.5 million) in 2022, up 20 percent on a year-on-year basis. The consultancy said the market will maintain double-digit growth in the next five years.

"With the country's economic development, and rising disposable income levels and living standards, people are displaying growing demand for quality of life considerations, thus contributing to the popularization of hotel fragrances," said a report from gonyn.com.

Currently, "five-star-hotel-use fragrance" has become an important subcategory of fragrance products on e-commerce platforms. There are over 10,000 posts related to hotel fragrances on xiaohongshu, an online lifestyle-sharing platform.

People are sometimes so fond of the fragrances at some hotels that they buy the same fragrance for use at home, thus generating new revenue streams.

Wu Daiqi, CEO of Shenzhen, Guangdong province-based Keythink Culture Communication Co Ltd, said: "The three-year pandemic had almost halted inbound and outbound travel, making domestic travel the mainstream. Many high net-worth individuals have shifted to the domestic market, and they have an increasing need for high-quality hotel fragrances. Also, as young people are becoming the consumption backbone, personalized, experience-based consumption demand makes hotels that own customized fragrances more popular."

Data from market research consultancy iiMedia showed that the main consumption group of China's fragrance market is those between 24 and 40 years of age, making up 77.2 percent. And 66.6 percent of these consumers earn between 5,000 yuan and 15,000 yuan monthly, which means they have great consumption potential.

"Meanwhile, the industry continues to clear up, the rate of branding is accelerating, and the competitiveness of the industry is increasing. There is an increasing demand for hotels to create brand differentiation through products such as fragrances," Wu added.

Enterprises are good at using fragrances in hotels to create memorable experiences of stays for guests, as pleasant smells help to improve emotional health and well-being, and create emotional connections between hotels and guests.

Atenalan, a Hangzhou, Zhejiang province-based fragrance provider, aims to create memories of happiness, energy and warmth when designing fragrances for Hampton by Hilton. The refreshing citrus tone is infused with a hint of brilliant floral fragrance alongside a lively and colorful aroma, allowing guests to deeply perceive the features of the brand.

Meanwhile, when designing the fragrance for Rezen Group — a high-end hotel brand under Ctrip — the company created a fragrance that contains a natural ocean scent and blends it with a fruity rich aroma in order to convey Rezen's features of warmth, leisure and happiness.

"Hotel fragrances help to boost consumer loyalty and repurchase rates, creating a second growth curve for hotel revenue," said the spokesman for Atenalan.

However, many hotels are trying to figure out how to better use fragrances.

"The hotel fragrance is not consistent throughout the building. In the lobby, the smell is sometimes too strong, while there is no aroma on some floors," said a lobby manager at a four-star hotel in Beijing.

Speaking of how fragrances can better match with hotel brands, Wu suggested that fragrance companies should have a full understanding of both the hotel's business mode and consumer needs under different scenarios.

"Based on consumer needs under different scenarios, the product design should make corresponding adjustments. For example, the installation of fragrances can be wall-mounted, ceiling-mounted and air outlet-oriented under different scenarios," she said.

Meanwhile, she noted that hotel fragrances should form differentiated characteristics to better promote the actual implementation of new retail sales in marketing, form a commercial closed-loop, and thereby enhance the competitiveness of hotels in terms of profitability.