Why do perfumes cost so much?

It's complicated. Let's unpack this (and you'll probably want to make a cuppa).

Last week I smelt a perfume that costs more than my first car. I should be used to this by now, but holding something so small in my palm worth more than my A-reg, £585 VW Polo my parents bought my sister and I back in 1997 still slightly blows my mind.

I know it blows your mind too. I see that daily in my DMs. I hear it at fragrance counters when I’m eavesdropping on shoppers. I read it in a PR’s embarrassed eyes. I feel it in the reactions of my Perfume Pals WhatsApp group (a tiny-yet-mighty Avengers Assemble of fellow writers and content creators that every PR in the land would pay a fortune to crack into. Can't say anymore. I’d have to kill you).

We are all exasperated, confused, fed up and pissed off. So I thought I’d try and untangle the pricing lunacy - not only to help you navigate it, but to make sense of it myself. Like when I walk around the house on a Saturday morning declaring my ginormous to-do list of weekend tasks; or telling JdP with great detail why I am a nightmare to live with (“left-handed”, “Gemini”, “dodgy knee” and “control addict” usually come up). If I say it out loud, it’s no longer rocketing around my head in silence, driving me mad. A problem shared and all.

Pricing. This is a pressure point I’m constantly aware of when I compile videos, shopping guides here on Substack or in recommendation for articles I’m asked to give a quote for. I am not here to judge anyone’s spending but I try to be as sensitive as possible to everyone’s budget. Within that spectrum, the affordable options must be credible and stand on their own merit (i.e. not shameless dupes). On the other end, the spenny ones need to carry the creative, qualitative and originality gravitas to warrant their elevated price-tag.

Over the past couple of years, those spenny ones have gone up and up and up - to a point where I now don’t even say how much something costs on screen because I fear it’ll frighten everyone away. How can anyone possibly justify or explain what these little pieces of scented art are worth?

Worth is the key word here, and I am going to pop my Mr Hyde pill and uncage my Gemini personality to explain my double-edged thought process.

My cynical, nasty, cold and selfish Gemini goblin thinks ‘worth’ is decided with pure extortion at its rotten core. There are vignettes in my mind’s imaginarium of boardrooms full of men in suits guffawing and nodding, shouting “f*ck it, let’s just ramp it up another hundred quid chaps and make ‘em feel insecure and intimidated! Tally ho!”. People in power take advantage of the humility and awe consumers experience when they’re around various forms of art and luxury. I suppose, in the end, it’s what you personally consider art or luxury, combined with how much of a complete sucker you are. In the same way that I consider a £1,450 gold-leaf-sprinkled tomahawk steak at SaltBae’s Nusr-Et restaurant utterly despicable and gross, I find it equally immoral and wrong for a mass designer fashion brand to charge £280 for a perfume aimed specifically at teenage girls.

In those cases, it’s not because of inflation / VAT / Covid / the Liz Truss hangover / [insert LBC radio topic]. It’s greed.

Mad fact: some perfumery ingredients, such as orris and oud, cost more per kilo than gold. (PS: this was from a shoot I styled a billion years ago when I was Beauty Director at Easy Living magazine - RIP. God it was messy, but a lot of fun!)

I found out something recently that cemented the shady, snakey, downright dispiriting reality of pricing strategy. A niche fragrance brand founder, who sells his perfumes at 185 Euros for 100ml, told me he’d been invited to meet the buyer of a major luxury department store in Paris earlier this year. “We’d prefer it if you raised the price to over 200 Euros,” they told him. “They’d sell better.” Sad times.

I feel as disappointed when I see a huge brand scream about using a rare and ethically sourced raw natural ingredient to justify the finished perfume’s exorbitant price. More often than not, the scent is made with a minuscule percentage of this oil so, because unlike the skincare industry there is no requirement for perfumes to list the quantity of ingredients used in their formulation. I find that quite manipulative and dark.

Urgh. We’re all doomed.

But wait! My good-witch Gemini twin has her hand up. Let’s give her the floor.

I worked recently with a high-end luxury brand, and when I asked them about price hiking they shared a fascinating explanation of its journey. During the pandemic, consumer spending dipped globally - of course it did - but it was in the months after lockdown lifted that beauty counters experienced bonkers levels of spending. People were literally throwing money at luxury and mid-luxury brands in a wave of ‘I deserve it’ mania, emptying stock that had piled up for months and relishing in the glamour, the fun, the self-expression, the choices, which for so long we were all robbed of. Unfortunately, that golden blip was unsustainable. But not for the reasons you think. Brands predicted that this spending frenzy would lose momentum, but it didn’t at all. The opposite in fact. What became unsustainable was the stock supply, and when your company prides itself on delivering a supreme service of perfection, a shortage of your favourite product can be detrimental to brand perception. The solution was to focus on faster production, which requires human skill, which costs big bucks. Combine that with general product improvement tweaks (more on this in a sec), and there’s only a certain amount of this overall cost increase that you can absorb internally before you have to place some of it onto the product’s pricetag. It’s not about filthy greed or sniggering extortion. It’s about survival.

I also understand and appreciate that price-hiking protects brand perception.

With more and more dupes, copycats and fakes saturating the market, the Real Thing is at risk of becoming a laughing stock. All you need to do is spend 20 minutes on TikTok to see how fragrances such as Baccarat Rouge 540 are now the butt of the joke, rather than the epitome of luxe it used to be. To rebuild and protect its status, a few clever, calculated moves have happened. For a start, their team guards that perfume like its the Crown Jewels. Unless you know the PRs personally and have an established relationship, there is no chance in hell you can merely ‘request a press sample’, and they won’t send one to an influencer or celebrity they don’t deem a trustworthy ally of the brand - regardless of audience numbers. The formula has undergone subtle tweaks to keep it as sustainable, ethical and skin compatible as possible, bettering its overall quality and responsibility. Subtle price-hiking is inevitable to lessen over-exposure and maintain a level of natural desirability and exclusivity. In 2019, a 70ml bottle of the Eau de Parfum cost £210. Today, the same size costs £245.

To be honest, I don’t think that increase is too wild. Not when you compare it to handbags, which will really blow your mind. Take a look at this insane Instagram graphic below, which accompanied a fascinating report by Business of Fashion’s Robert Williams last week:

“Today’s luxury prices are on average 54 percent higher than before Covid, according to HSBC, with key styles soaring still higher: the price of Chanel’s 2.55 flap bag has increased by 91 percent; Louis Vuitton’s Speedy is up by 100 percent,” writes Williams.

Flippin’ ek!

For perfume pricing, yes, it’s partly down to logistics. It’s partly due to unavoidable inflation and, yes, I do believe there’s a touch of Corporate Evil greed sprinkled in some areas. But a huge part of pricing comes down to actual genuine artistry and the organically rising price of human craftsmanship.

I don’t just mean the perfumer’s own salary. This includes the paycheques of the farmers who grow and harvest the ingredients on land (which is also incrementally more expensive to run). It includes the expense of more ethical and recyclable materials for packaging. The cost of clinical trials and regulation certificates that small, niche brands must cough up to ensure their perfume is allowed to sit on a counter in Selfridges. The efforts to source local oils from independently-owned companies. The actual quantity of those oils inside the perfume to improve longevity and performance on the skin. All of this I believe with gusto and while you might think I’m a sucker for the romance of heritage, quality and integrity, in most cases it is fact not fiction.

‘Our biggest cost is fragrance oil,’ says Olivia de Costa, founder of Olfactive O - an artisanal fine fragrance brand. “The perfumer and I work to high cost per kg budgets to allow use of a full and beautiful palette of raw materials with considered sourcing.  One of the reasons the perfumer left the big fragrance houses to work independently was to escape restrictive briefs and miniscule budgets (whilst still being expected to deliver magic!) so it's always been important to both of us that there is creative and cost freedom. It does mean though that we have to invest a lot of money in purchasing minimum order quantities of expensive ingredients and we need the cash flow to do that.”

Olivia experienced the inevitable pinch post-Covid, and had no option but to raise her prices. “In the 4 years since we launched, we’ve only had to do that once,” she says. “Everything increased in price multiple times over - raw perfume materials, components, manufacture - and we couldn't continue to absorb it.” Luckily the brand has maintained one (very decent) price-tag since, at £65 for a 30ml bottle.

“We create in small batches and source as locally as possible in the UK. We don't buy components in huge volumes from China, for example, so each element - glass, lids etc - are more expensive,” she adds. “We pay huge attention to quality right down to the perfect hand-applied label application, which is rightly-so not a cheap production!”

I’m lucky enough to meet independent brand founders like Olivia often and I can honestly say, hand-on-heart, the passion for maintaining quality, credibility and ethics is embedded in their DNA.

“We reinvest 5% of all our income back to the suppliers and farmers, so that they can build a stronger production system with improved welfare and working conditions,” explains Sebastien Tissot, founder of Nissaba Fragrances - a beyond-sustainable fine fragrance house that actively generates positive ethical change right at the start of the supply chain. “That longterm vision impacts the livelihoods of everyone involved in the raw ingredients production for the better.”

Sebastien has priced his perfumes at £150 each per 100ml bottle, regardless of the cost of the ingredients inside. “Some perfumes contain a percentage of oil that is astronomical in price compared to others in the collection, but it’s crucial to bring fairness and equality to the brand. My biggest headache? Phonecalls from my accountant!”

When you see it like that, when you delve deeper into the phenomenal purpose behind a brand like Nissaba and you smell their stunning perfumes (this one lasted hours on my skin) frankly, you can take my wallet.

“I never want to compromise on quality and service for the sake of cost - it's too important to me,” adds Olivia. “Most of the suppliers we've worked with since the beginning are hugely supportive and will always try to make costs workable for us. Even the buyers [Olfactive O is stocked in Les Senteurs and Harvey Nichols] have embraced the fact that we are at the more accessible end of niche pricing and never ask us to change our prices.” I am so, so happy to hear that.

As I said, it’s complicated, but I understand why certain perfumes are expensive. I still won’t tell you on screen if it’s megabucks. I will continue to be highly suspicious of many mass brands and their deceptive ways. I will, as I always have, champion art where I think, in my capacity as a nosy journalist, it is worth the pricetag.

I will gladly continue to blame being a Gemini for sitting comfortably on this fence.

What do YOU think? Are you fed up with everything being so expensive? Do you embrace that luxury comes at a premium? What’s the most you’ve ever spent on a perfume? Let’s discuss below and I promise your comments and opinions are welcome and safe here.

Thank you, as ever, for subscribing to my Perfume Playground. Did you even make it this far down the article? Well done! It’s great to have you here and thank you for supporting my Substack. I love that I can write insanely long pieces here without a sub-editor chopping it all off.

Alice x