Niche fragrance in China: How to avoid Aesop's fate

For the latest on skincare, cosmetics, fragrances, wellness, emerging Chinese and APAC beauty brands, subscribe to our weekly Jing Beauty Newsletter. Maison Francis Kurkdjian’s flagship store closure in Nanjing’s Deji Plaza mall has become a telling metaphor for the shifting tides of niche fragrance brands in China. Once hailed as a crown jewel of LVMH’s ultra-premium fragrance portfolio, the closure (the brand maintains a presence in SKP and duty-free counters) speaks volumes about the mounting pressures brands now face in what was once a high-growth paradise. “Maison Francis Kurkdjian is at a turning point,” says Anaïs Bournonville, President and CEO of Chinese marketing agency AB Advisory. “The brand must redefine its strategy in China to build more emotional bonds and improve consumer loyalty. Like many ultra-niche brands, its early success came from an unexpected opportunity — now, the challenge is transforming that into long-term growth.” This is not an isolated case. Aesop, the cult Australian label under L’Oréal, is shuttering its first mainland boutique on Shanghai’s Dongping Road on May 10, just two and a half years after it opened with much fanfare. And while brands like Creed, Diptyque, and Perfumer H are expanding or innovating, others like Chunshan and Xizi Linglong — once hopeful homegrown stars — have faded amid investor fatigue and shallow storytelling. Despite these closures, China’s fragrance market is forecast to grow to $4.5 billion this year, driven by Gen Z demand, cultural storytelling, and ritualized self-care habits. What matters now is a multi-sensory, emotionally intelligent, and culturally fluent strategy that bridges the online and offline worlds. From product to experience: Fragrance new luxury language Consumers are no longer seduced by a Parisian name alone. “The Chinese fragrance market is still growing by 14% annually, hence it has never been so fiercely battled between international, regional and local brands. This puts fragrance brands under significant pressure,” says Dao Nguyen, founder of boutique strategic consultancy Essenzia by Dao. In China’s hyper-competitive fragrance space, experience is fast becoming the new definition of exclusivity. Perfumer H’s flagship store in Shanghai, located in a restored lane house, epitomizes this transformation. Designed to reflect founder Lyn Harris’ intimate creative philosophy, the four-story space fuses scent libraries, seasonal tea rituals, and bespoke consultations to foster long-term brand relationships. British heritage brand Penhaligon’s took a similar route, debuting its first-ever global exhibition in Shanghai rather than London. Titled “Eau So British,” the immersive event transformed He Dong Mansion into a journey through scent, heritage, and interactive artistry. This wasn’t just a marketing stunt, it was a nod to China’s critical role in the global fragrance narrative. Nguyen says: “It’s not only about being offline, it is about how brands show up offline. The ability to share proprietary, entertaining, educational, selfie-friendly experiences is what matters, in an environment the bar is constantly elevating.” “Offline presence is essential for fragrance brands,” Bournonville adds. “Perfume remains a tactile, sensory experience. But like luxury before it, fragrance brands expanded too quickly. Now, the winning formula is slowing down — fewer but deeper activations, retail partnerships, and pop-ups that truly resonate.” Emotional resonance over olfactory pedigree China’s Gen Z is reshaping the rules of fragrance, prioritizing personal expression and emotional authenticity over heritage or ingredient provenance alone. “For Chinese consumers, storytelling, ingredient quality and provenance, and olfactory uniqueness matter,” says Bournonville. “But above all, they remember the emotion a scent conveys. Fragrance is no longer just a product; it’s part of mood, identity, and daily rituals.” This shift toward experiential authenticity is echoed in Diptyque’s recent launch of sustainable home fragrance refills in China, called ‘Reed.’ Incorporating the label’s cold diffusion technology and an oval-shaped design inspired by its logo, the collection doubles as decorative indoor objects. While the refill concept supports global sustainability goals, in China it also aligns with rising consumer demand for ritualized, tactile consumption. Refill stations allow customers to return to stores, deepen brand engagement, and reaffirm their own eco-conscious values in an era of elevated environmental awareness. “It’s not about the what, it’s about the how,” Nguyen tells Jing Daily. “Cultural relevance, sincerity and uniqueness are what make a difference.” Brands that lean too heavily on European elitism, or generic luxury cues risk alienating younger buyers. Local Chinese brands have taken this insight to heart. While some mid-tier names have exited the market, others, like To Summer, Documents, and Melt Season, are thriving by tapping into native scent memories, herbal motifs, and even traditional medicine. These brands don’t just sell perfume, they offer a sense of belonging and cultural continuity. The pitfalls of ‘copy and paste’ strategies In contrast, many global niche brands made the mistake of “copy-pasting” their Western content onto Chinese platforms. Xiaohongshu (also known as RedNote) and WeChat were flooded with stylized Instagram replicas, high on aesthetics, low on local nuance. “A lot of niche brands just duplicated their Instagram content on Xiaohongshu,” Bournonville says. “That helped build initial awareness, but failed to create emotional depth. Meanwhile, those that rushed into distributor deals are now seen as overly commercial and lacking soul.” Elisa Harca, co-founder and Asia CEO of award-winning Chinese marketing agency Red Ant, agrees that brand commitment, and patience, are key. “We’ve worked with both small and big brands like Trudon and Creed,” she says. “The common thread? Excellent products, realistic expansion plans, a strong local voice, and leadership that’s in it for the long haul. Post Covid, the ones that succeed are those who didn’t chicken out.” Creed’s recent collaboration with snow artist Simon Beck — transforming the icy landscape of Xilingol, Inner Mongolia, into a branded art piece inspired by Creed’s iconic fragrance Silver Mountain Water — demonstrates how storytelling, place-making, and craftsmanship can converge into cultural moments that resonate far beyond retail shelves. Notably, in Q1 2025, Kering Beauté posted a 6% YoY revenue increase to $80 million (580 million RMB), driven by steady demand for its Creed line, while Gucci reported a 25% sales decline. Fragmentation or future consolidation? Despite growing pains all three experts agree: China’s niche fragrance sector is far from saturated. If anything, it’s entering a second phase, one defined by high volatility, surging creativity, and parallel trends of fragmentation and consolidation. According to the “2024 Perfume Trend Insights” report, China’s fragrance market is projected to grow at a compound annual growth rate (CAGR) of 14.7% between 2018 and 2025 — well above the global rate of 3%. This stark contrast reflects the maturity of fragrance usage overseas, while in China, perfumes still carry the appeal of an exotic novelty. “We’re still in the early stages of China’s fragrance boom,” says Harca. “When I attended the Notes fragrance fair this year, I saw so many Chinese brands with unique styles and perspectives. It’s even more fun than fashion — less about trend-chasing, more about individuality.” Nguyen described the current state as ‘highly volatile,” where indie upstarts and creative disruptors will continue to pop up while a handful of legacy brands consolidate their edge. Bournonville, too, remains bullish: “The Chinese fragrance market is still emerging. It’s become a new growth driver for the global beauty sector. Yes, it’s crowded, but it’s also full of opportunity. The next few years will determine who gets it right.” The path forward: Cultural intelligence and creative courage As global giants recalibrate their strategies, the lesson from China is clear: growth now depends not on scale, but on nuance. Whether through local collaborations, immersive stores, or reinterpretations of traditional rituals, brands must meet consumers not just in the marketplace, but in the cultural imagination. The Chinese fragrance boom was never just about importing products — it’s about co-creating identity. The next wave of winners will be those who understand China not as a retail destination but as a crucible of new olfactory storytelling.

Niche fragrance in China: How to avoid Aesop's fate

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Published May 08, 2025

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Niche fragrance in China: How to avoid Aesop's fate