Fragrance market expands rapidly in China

In recent years, Chinese-style fragrances have become a hit with consumers for the unique sensory experience and cultural charm they offer. Ancient fragrance formulas have entered people's lives with the help of modern technology.

Chinese-style incense has emerged as a fast-growing segment in the fragrance category. By updating ancient fragrance formulas, market acceptance has increased, leading to higher sales.

Photo shows fragrance products. (People's Daily Online Overseas Edition/Wang Jingyue)

Perfumer Zhang Fan, with over 10 years of experience, has worked with nearly 1,000 fragrance formulas. He mentioned that Chinese fragrance ingredients such as nut grass, osmanthus, gardenia, and mugwort are increasingly used in the last two years, creating a distinct Chinese scent aesthetic.

Domestically produced perfumes are also on the rise. Industry insiders revealed that while foreign brands used to dominate the domestic perfume market, many domestic brands have now become a new growth point.

Yang Qiaolan, operations manager of a Chinese perfume store, said that the store's sales have increased by about 30 percent compared to last year. Tea-based perfumes have been popular choices. Many foreign visitors bring these perfumes back as gifts for friends and family.

The popularity of fragrance products has fueled production. The olfactory economy has led to new consumer formats focused on experiences, attracting the attention of many consumers.

At an incense factory located in Xianyou county, Putian city, southeast China's Fujian Province, a new batch of incense sticks was just finished and ready for packaging. Lin Qifeng, head of the factory, said that in the past, there were only one or two incense factories nearby with limited production capacity. However, this year has seen an increase to 20 to 30 factories, with a significant rise in orders.

According to Lin, the annual output value of his factory is around 10 million yuan (about $1.4 million).

The olfactory economy industrial chain is expanding, with a rising interest in experiential consumption alongside the purchase of products like perfumes and incense.

Data released by iiMedia Research shows that the market size of the fragrance industry in China was estimated at around 18.15 billion yuan in 2023, with a year-on-year growth of 24.25 percent. The figure is projected to increase to 25.44 billion yuan by 2025.

According to data from the online database query platform Tianyancha, there are currently over 313,000 companies in China associated with perfumes and fragrances. The number of such companies registered annually has been increasing for 10 consecutive years.