Introduction
The global perfume market is projected to grow to USD 77.52 billion by 2032 which translates to a CAGR of 5.51% during the forecast period. This growth can be attributed to the increasing demand for such products.
Source: FACTMR
Back in June 2020, Givaudan, a leading player in the global fragrance and scent industry, launched ‘VivaScentz’, a creative scent technology. It helped the company curate diverse categories of fragrances like personal, home, fabric, oral care, and fine fragrance flavors.
Source: Instagram Post
Every now and then, there are new trends shaping up the fragrance industry. Recently, fragrance industry professionals have started incorporating AI as a catalyst of creativity and efficiency. Just like other industries, Artificial Intelligence (AI) has empowered human talent and made it easier for the fragrance industry to enhance their product line.
Let’s take a look at the different ways in which AI has transformed the perfume industry…
Using AI in the Fragrance Industry
1. Enhancing Customer Service
Personalization has become an indispensable part of marketing strategy across all industries. Even the customers are expecting tailored customer service according to their preferences. Fragrance industries have started employing chatbots that share tailored recommendations for your signature scent according to your choices. There are AI-driven tools that suggest products that particularly match your skin condition. Such a personalized service improves customer satisfaction and boosts brand loyalty.
2. Data Analytics for Customer Loyalty
With the help of AI, you can analyze sales data and unveil customer preferences. It will also give you an insight into emerging trends related to the fragrance industry. Such realtime updates help companies have an edge over the competitors and overhaul their strategies promptly according to the consumer demands.
3. Product Development
AI tools can be extremely beneficial in developing new products. Fragrances can be prepared in no time by using this advanced technology. The best part is that these tools can create products, considering the regional compliance requirements. As an implication, AI tools will make the perfume-making process more efficient while reducing the manpower needed. For example: Givaudan has launched a device called Carto that quickly develops a perfume through AI-generated research. Through this tool, perfume makers can experiment with new formulas easily and effectively.
Estée Lauder is trying AI to personalize fragrance recommendations according to a person’s neurological reactions. It is based on the principle that certain fragrances elicit the same neurological reaction, making a person most likely to like them even though the smells vary. These are known as neuroscents.
L’Oreal has also utilized similar technology to connect neuro responses and fragrance preferences. It uses machine learning algorithms to interpret EEG. It creates scents in sync with the user’s emotions.
4. Better Inventory Planning
AI makes inventory planning better as it combines internal data and external parameters like seasonal patterns, environmental conditions, and topics trending on social media. Because of this holistic approach, fragrance industries are able to reduce waste by maintaining optimum stock levels. It will also improve the turnover rates.
5. Improved Operational Efficiency
AI helps automate repetitive tasks like data entry, meeting notes, bookkeeping, and image editing. It also helps execute better marketing strategies with automated communications triggered according to the customer’s actions. Moreover, AI can also generate pictures of models for your marketing campaigns. Such a wonderful idea, right?
6. Cross-selling and Upselling
Through AI-powered recommendations, you can cross-sell and upsell related fragrances or other cosmetic products. It will not only lead to higher conversion rates but also increased average order values. Therefore, it will uplift the overall shopping experience through personalization.
7. Dynamic Pricing Strategies
In a traditional setup, there is a weekly update of the promotional offers and pricing. Through AI, you can make these updates daily or multiple times every day. For example: In summer and humid weather, people would need stronger and long-lasting fragrances. Hence, they should promote perfumes that are more likely to get sold out during such a season.
8. Content Creation
With AI tools at your service, you can easily create marketing campaigns that perfectly sync with the brand tone. It contributes to creating an effective omnichannel strategy that imparts a pleasant digital experience for the users.
9. Cybersecurity
AI tools help safeguard against cyber attacks and identify risks in real time. It also lets the security teams deal with the vulnerabilities promptly.
Wrapping Up
Boosting customer loyalty and retaining existing customers is a challenge because of the intensely competitive fragrance market. There are so many brands dealing with the best fragrances of all types, including premium perfumes. Employing AI tools and data-driven information will strengthen the marketing game and also enhance the products, thereby empowering customer relationships.
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As Head - Digital Marketing, Zenul leads the marketing and branding at Krish. He brings with him an in-depth understanding of the evolving digital ecosystem and has a proven expertise and experience in strategic planning, market and competition analysis, creating and implementing client-centered, lead-gen and brand marketing campaigns. He has a heart for technology innovation and has been a keynote speaker on various platforms.
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