In the bustling corridors of China’s fragrance market, where beauty and luxury converge, one name shines brightly amidst the competition: Acqua di Parma. In 2023, China’s fragrance market surpassed RMB 200 billion and is poised to exceed RMB 539 billion by 2028. Despite the dominance of major foreign cosmetic conglomerates such as L’Oréal, Estée Lauder, LVMH, and Coty, the competitive landscape and focus of competition are experiencing new shifts. One notable contender in this evolving market is Acqua di Parma, a brand renowned for its Italian heritage, craftsmanship, and timeless elegance.
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Acqua di Parma’s ability to stay true to its Italian Mediterranean Sea heritage while adapting to the demands of the Chinese market is what makes it a compelling subject of discussion. In this article, we will delve into the brand’s strategic approach, exploring its positioning and marketing strategy. Through this analysis, we aim to uncover the secrets behind Acqua di Parma’s success in capturing the hearts of Chinese consumers.
Luxury and sophistication: Acqua di Parma’s successful story in China’s affluent market
Acqua di Parma in China is positioned as a luxury fragrance and lifestyle brand targeting Chinese affluent consumers, particularly urban professionals and high-net-worth individuals, who value luxury, prestige, and sophistication. The brand’s audience is characterized by their discerning taste, appreciation for craftsmanship, and willingness to invest in premium perfumes and eau de toilette that reflect their lifestyle and status.
Premium pricing strategy
On Taobao, one of China’s largest e-commerce platforms, the brand offers a wide range of products with prices ranging from RMB 385 to RMB 7,930 (excluding fragrance samples). However, according to iiMedia Research, nearly half of Chinese consumers buy perfume at a price range of RMB 100 to RMB 200. This stark contrast underscores Acqua di Parma’s premium pricing strategy, which aligns with its positioning as a symbol of luxury and prestige. In addition to fragrances, it also sells complementary products such as hand creams, body lotions, and diffusers, catering to consumers seeking a comprehensive luxury experience beyond just perfumes.
Source: Taobao, the brand’s best-selling products (excluding fragrance samples) and their prices on Taobao
Acqua di Parma records steady growth in the Chinese market
Beyond pricing, it’s worth noting the brand’s expanding presence and positive consumer reception. Acqua di Parma’s domestic performance in 2021 increased by 66.2%. The brand held a market share of 1.17% on Taobao and Tmall in 2023, ranking 15th among fragrance brands. While this may not rival top-tier brands like Chanel or Hermes, the brand’s steady growth trajectory is evident, coupled with a positive reputation among both men and women in China.
What do Chinese people value in the brand?
Delving into the reasons behind its popularity sheds light on the brand’s unique appeal, whose unique selling point lies in its classical beauty of products, rooted in rich Italian heritage. For instance, Laura Burdese, the CEO and President of Acqua di Parma, highlights the brand’s exceptional qualities by emphasizing its historical legacy. She stated, “A brand can stand out for two reasons: disruptive creativity or breakthrough innovation, or brand history. Acqua di Parma belongs to the latter category. Everything the brand does today is aimed at its founding mission: to immortalize the art of Italian living.”
Source: Xiaohongshu, the brand is popular for its classical beauty (古典的美) on the social media platform
Strategic Initiatives of Acqua di Parma in China
Diversified distribution channels
In addition to brand-operated flagship stores, the brand ensures accessibility for consumers through a diverse array of distribution channels, including department stores and travel retail outlets. While flagship stores offer an immersive experience, recognizing the impracticality of establishing them in every market, the brand strategically collaborates with department stores to reach customers who may not frequent boutique stores regularly.
Furthermore, Acqua di Parma has partnered with selected luxury hotels worldwide to distribute its bathing product line, further expanding the reach. In the future, the brand may focus on digital channels for expansion, particularly social e-commerce platforms, such as WeChat, Douyin, and Little Red Book (Xiaohongshu) to reach a broader audience and enhance consumer engagement. For instance, on Weibo, the brand has already gained 86 thousand subscribers and the cumulative video views were over 95.8 million as of March 14, 2024.
Pop-up spaces and exhibitions
Acqua di Parma in China has strategically leveraged physical spaces, particularly through the utilization of pop-up spaces, to reinforce its brand identity and aesthetics in the market. In July 2022, the brand collaborated with Chinese home furniture and lifestyle brand Cabana to establish a limited-time art home space in Shanghai under the theme “Play At Home” (重塑格调之家). This collaboration initiated an immersive journey blending fragrances with home decor, engaging consumers in an experiential exploration of the brand’s essence.
The brand’s engagement in exhibitions and immersive interactive experiences is not novel, with previous instances such as the “Scented Acqua di Parma”(闻得到的帕尔玛) exhibition held in Shanghai in May 2021 and the “Style Sunlight Scroll”(格调日光画卷) immersive interactive experience exhibition in Shanghai in January 2022, created in collaboration with Chinese artist Liu Jiayu. Through these exhibitions, the brand has effectively activated the power of scene-setting, enriching the consumer experience by combining visual and olfactory elements, thereby presenting the product characteristics, including fragrance and packaging design, in a more immersive and engaging manner.
Source: Weibo, the design of the pop-up space in cooperation with Chinese brands revolves around the new series of perfume products
Influencer partnerships
Moreover, Acqua di Parma’s partnership with actor Li Xian as its global fragrance ambassador since 2021 enhanced the brand’s appeal in the Chinese market. Li Xian’s endorsement helped the brand connect with a broader audience, particularly among his fan base. The hashtag #Acqua di Parma Global Fragrance Master Li Xian (帕尔玛之水全球香氛大师李现) has garnered over 136 thousand views as of March 10, 2024, indicating the effectiveness of the partnership in generating engagement and raising awareness about the brand’s fragrance offerings.
Source: Weibo, the brand has been collaborating with actor Li Xian as its global fragrance ambassador since 2021
Localization, adaptation, and expanding reach in China
Local co-branding
To cater to Chinese sensibilities, Acqua di Parma collaborates with local entities, such as the partnership with the Chinese theatre team. In August 2023, the brand launched a limited-time immersive interactive experience exhibition, in collaboration with the creative team behind the immersive theatre production ” “Sleep No More, Shanghai”(不眠之夜)”. This exhibition centred around its two new fragrances and reflected an innovative approach to engaging Chinese consumers through culturally relevant experiences.
Furthermore, it collaborated with Chinese artists and designers such as He Xian, which resulted in a series of artistic creations centred around the “Light of Style”(格调之光) perfume series and home fragrance collections. This integration enhances the sensory appeal of products, ensuring they resonate with the aesthetic preferences of the Chinese market.
Source: ELLE, the brand collaborated with Chinese theaters
Festive marketing
Additionally, the brand’s engagement with traditional Chinese festivals serves as a bridge to connect with consumers emotionally. Recognizing the significance of these festivals, Acqua di Parma incorporates local elements into its fast-paced marketing strategies. The launch of a limited-edition gift box in Chinese New Year 2024 exemplifies this. The hashtag # Mulanshi blooms endlessly(木兰新姿 绽放未央)# associated with the campaign has gained significant attention with a Weibo topic discussion reaching over 281 thousand views as of March 10, 2024.
The future outlook for Acqua di Parma in China: seizing market expansion opportunities
Looking ahead, Acqua di Parma in China is poised for further growth. On March 23, 2023, the brand announced the appointment of Giulio Bergamaschi as its new CEO. Bergamaschi’s leadership is expected to further elevate the brand’s uniqueness and globalization efforts. The group indicated that Bergamaschi’s appointment is aimed at expanding into the Chinese market. With this strategic leadership change and a continued focus on market penetration, the brand is likely to further expand and succeed in the Chinese market.
What do you need to know about Acqua di Parma in China?
- Acqua di Parma in China, a luxury fragrance and lifestyle brand, targets affluent consumers, utilizing a premium pricing strategy and classical beauty rooted in Italian heritage.
- The brand shows robust growth in China with a 66.2% increase in domestic performance in 2021, solidifying its positive consumer reception.
- The brand embraces diversified distribution channels, collaborating with department stores and luxury hotels, hinting at potential digital expansion.
- The brand utilizes physical spaces, such as pop-up experiences and immersive exhibitions, while partnerships with influencers like Li Xian also enhance its appeal.
- The brand effectively localizes its brand in China by collaborating with local theater teams, launching immersive exhibitions, partnering with Chinese artists/designers, and incorporating traditional festivals.
- Looking ahead, Acqua di Parma aims for Chinese market expansion, with new CEO Bergamaschi leading globalization efforts.
Unlock the potential of your brand in China
As Acqua di Parma continues to chart its course for expansion in the vibrant Chinese market, businesses seeking to navigate similar pathways of growth can leverage strategic insights and expertise. At Daxue Consulting, we harness our deep understanding of this trend to offer comprehensive branding, market research, and consulting services tailored to the unique demands of China’s athleisure sector.
Our approach is data-driven and customer-centric, ensuring that every strategy is grounded in a thorough understanding of the Chinese consumer’s preferences and behaviors. From granular analysis of market trends to actionable insights for brand positioning and customer engagement, our expertise covers all facets necessary for a brand’s success. Our suite of services extends to management consulting, where we streamline your operations and align them with the nuanced complexities of the Chinese market.
Whether you’re establishing a new luxury line or optimizing an existing brand, Daxue Consulting is your partner in navigating this dynamic industry landscape, ensuring that your brand not only enters the market but thrives in it. Contact us to learn more about how we can help you.
