Scent of money in Phnom Penh

Posted on: April 1, 2008 | Business

High-end designer brands are becoming familiar to a growing number of olfactory aware shoppers.

Good taste: advisers help in the buying process (Ryan Plummer)In the perfume section of a Phnom Penh shopping mall, image counters host a wide range of top perfume brands. Tourists are used to buying the knock-offs and copies, but the real thing is a novelty in Cambodia. Perfumiers say that high-end sales have increased significantly in recent years, which is perhaps another sign that the country’s shoppers are becoming better off.Tang Hong is Cambodia’s top luxury perfume importer, providing over 40 brands to its five sales outlets and to half of Phnom Penh’s private re-sellers. With rising brand awareness among Cambodia’s middle and upper classes it is no surprise that the average price for upmarket fragrances of $50 is being paid without the usual bargaining.

The perfume market in Cambodia is small, but within the target group for high-end products that special fragrance is about to become a must. “Our buyers are foreigners and middle and upper-class Cambodians,” says Kenix Tang, Tang Hong’s senior brand manager in Phnom Penh. Special concerns in Cambodia are staff training and brand loyalty. Attractive beauty advisers need to be trained in sales techniques, perfume fragrances, ingredients, brand identification and customer service to break down the average Khmer customer’s one-brand preference.

“People find something they like and then wear the same fragrance for years. Some of our older customers buy four identical bottles at a time,” says Kenix. “I think they’re worried we’re going to run out of stock.”
The first brand to enter Cambodia was Givenchy, which has retained loyal users for more than five years. Sales staff do not try to foist new fragrances from an old favourite on these familiar faces but instead introduce new brands such as Bulgari, Hugo Boss, Versace and Gucci to customers unfamiliar with these internationally known names.

Perfume producers retain careful control of product advertisement, so Tang Hong marketeers must be creative when launching new products. Instead of placing ads in magazines or on television, which are seen as mass markets and don’t fit the high-end marketing strategies of designer brands, they use leaflets or host parties for Phnom Penh’s top people. The next brand due to be launched is Yves Saint Laurent’s, elle, which was launched in Hong Kong in January and will arrive on Phnom Penh’s sales shelves this June.

In the fragrance industry, phoney products aren’t as much of a market threat as in fashion and accessories. Copying fragrances is much more challenging. In Cambodia, the grey market is the biggest thorn in the side of legal distributors. “About half of Phnom Penh’s perfume resellers bring their products into Cambodia on the grey market by travelling to Hong Kong or Singapore, loading up on perfume and then bribing customs officials to avoid having to pay high duties,” Tang says, “and there’s nothing we can do about it.

“So we explain that our products are more expensive because we sell the original, provide better service and offer gifts with each purchase.” The presentation and variety of products in shopping centres such as the Sydney or Pencil department store also give a better pre-sales service and aftercare than in a corner store with only amateur staff.

Srey Mom, the model and a former Miss Cambodia, uses her favourite fragrance brand sparingly. “I like Bulgari, but I only use it when I’m going out to an event or party,” she says after checking out some of the other fragrances at one of Phnom Penh’s malls. Voleak, a local shopper, says: “I used to wear perfumes from local markets at big events such as weddings, but in recent years I have become familiar with western fashion brands – it is becoming chic,” she says.