COLUMBUS, OHIO — You could smell the Fresh Balsam from the parking lot.
It was a perfect late summer day in Beauty Park, the quaintly named industrial zone spanning 10 beauty, fragrance and component manufacturers just northeast of Ohio’s capital, but it was simultaneously early fall, late fall and Christmas inside Bath & Body Works’ candle factory, which was operating at peak production a few months ahead of the most wonderful time of the year.
Fresh Balsam has been one of Bath & Body Works’ signatures for over three decades, and is a Proustian time warp for anyone who grew up in the 1990s, alongside Sweet Pea and Into the Night. Gen-Z shoppers have also become enamoured: In Piper Sandler’s annual Taking Stock of Teens survey, the retailer took the number three spot, returning to the top 10 for the first time since 2018.
But despite a global perfume boom, the scent-centric retailer’s growth has been constrained. Bath & Body Works expects demand to lift only slightly this year, projecting net sales of between $7.41 billion and $7.50 billion, or 1.5 to 2.7 percent over 2024, according to its latest earnings release. The company has also seen a rapid succession of chief executives. The latest is Daniel Heaf, who joined the company in May.
Heaf is galvanised by the challenge of bringing Bath & Body Works into the future. A former executive at Burberry, he oversaw the fashion brand’s early and eager embrace of social media and the sports giant’s establishment of its global “innovation centres” in megacities across the world. His plan for Bath & Body Works sounds, at first, like a football coach giving a team talk: Heaf has introduced three “no-regret moves” to “elevate our digital experience, amplify our product efficacy, and expand distribution,” as he wrote on LinkedIn in late August.
“It’s an insanely big business, but it’s a bit of a sleeping giant,” Heaf told The Business of Beauty earlier that day. We were sitting at a Starbucks encased within Distribution Centre 3, one of a handful of corporate offices scattered around campus. The atrium is cast in a palette of white and blue, refracting the company’s signature gingham.
Bath & Body Works’ sheer size may prove both an asset — in offsetting tariff-related costs — and a liability — as trendier, faster-moving brands like Kayali and Sol de Janeiro have taken share away from the mall mainstay. Its beating manufacturing heart has to pump a massive amount of product farther and wider than ever before — now at the speed of TikTok. To fulfil Heaf’s vision of a digitally responsive brand, while recapturing its trend authority, Bath & Body Works will have to go from a sleeping giant to a sprinting one.
The Sweet Smell of Rebirth
While the world has been gripped in fragrance mania, Bath & Body Works’ market share has declined — from 17 percent of the US fragrance market in 2015 to 12 percent a decade later — as it’s challenged at all angles: by challenger brands like Sol de Janeiro, by designer labels releasing body mists, by companies like Gap Inc. taking a page from their playbook and by longtime shoppers trading up to niche or premium scents.
This week, the company unveils its latest attempt to bring them back. Its latest fragrance, called Touch of Gold, launches as part of the company’s annual fall tradition of debuting trend-forward fragrances that coincide with the earliest glimmers of the holiday season. Nathalie Benareau, the Symrise nose who worked on Touch of Gold, also developed Paco Rabanne One Million Gold. It releases on Sept. 22 in an exclusive TikTok Shop bundle, with a body mist, body lotion, tray and charm, before going wide on Sept. 25.
Touch of Gold’s key neroli note comes from an expensive orange blossom sourced from the south of France, which might otherwise be found in a $100 or $200 perfume. A vogue for orange blossom coincides not only with the greater neo-gourmand movement but also by fashion’s metallic trend. Its sharp neroli is softened with the scent of tonka bean, commonly found in the vanilla-forward fragrances the retailer is known for.
“You want the customer to have the things that they love, but bring them to another level,” Benareau said.
For the next five or so weeks, storefronts will be dressed in Touch of Gold, with displays touting the latest launch until it’s time to move into holiday products. They’re also flanked by Japanese Cherry Blossom, a core scent that got a recent packaging refresh. Repackages of iconic scents are introduced regularly.
“Where we bring more fashion into our icons, they can lift in the double digits for us year over year,” said chief merchandising officer Betsy Schumacher. The top 10 fragrances in Bath & Body Works’ portfolio (e.g., Warm Vanilla Sugar, Champagne Toast) generate about $1 billion in sales.
Wall Street will be eyeing innovation carefully, eager to see if softer sales in the beginning of the year will be offset by new launches in the latter half.
So will fans of the brand. “Newness and seasonal variety is what makes the brand so fun,” said Kent Stephan, the Bath & Body Works fan behind The Candle Channel on Youtube, who added that he’d rather purchase his 10th new pumpkin variation of the season than only be limited to best-sellers.
A Brave New Store
After a 10-minute drive from DC-3, Bath & Body Works’ store of the future is sandwiched between Walmart and Nothing Bundt Cakes.
The company has created a new in-store format they’re calling Gingham Plus, which is in the process of a worldwide rollout. Of the 30 stores opening this year, as far as South Korea and as near as Texas, “the majority” have been Gingham Plus, a company spokesperson said.
Rather than pushing stock with abundant table and shelf displays, Gingham Plus will introduce spots to “dwell” throughout the store, said Schumacher. (The strategy is not dissimilar to Aesop’s retail theatre.) These stores will feature Scent Bars where shoppers can experiment with layering, and displays for its “wallflower” plug-in fragrance blends; there will also be designated sections for its wellness-adjacent aromatherapy and skincare formulas, as well as men’s products.
Given the focus on updated stores, the future holds greater opportunities for international expansion. In addition to its 1,900-door North American footprint, the company operates 500 international stores, though sales outside the US only comprise 5 percent of overall business.
But Bath & Body Works has also made strides to shift its distribution away from relying exclusively on its fleet of retail stores. It recently released a “Summerween” collection capitalising on a TikTok trend that saw an exclusive launch on TikTok Shop. The I Scream Float Body Mist, a vanilla scent with cola notes, sold out the day it debuted on the e-commerce platform, but the company was able to draw shoppers to stores by bringing back inventory within four weeks.
Analysts and observers have praised the company’s moves so far, especially its decision this summer to expand distribution into 600 college campus bookstores.
“If you want a new body splash and your option is either to drive to the closest Sephora and pay for Sol [de Janeiro] or head to the campus bookstore and get Cucumber Melon subsidised by dear old mom or dad, it’s kind of a no-brainer,” said Casey Lewis, a Gen-Z shopping consultant who writes the After School newsletter.
The Candle-to-Detergent Pipeline
At 35 years old, Bath & Body Works is firmly in the Millennial cohort. Those who grew up with the retailer, but wandered away, may be surprised to return and rediscover just how sophisticated the scents are. They also will be astounded by how widely the range has expanded.
In recent years, the company has launched a laundry collection of detergents and fragrance boosters and broadened its men’s range. In 2022, it introduced a full range of lightly scented sunscreens, as well as an “ingredient-led wellness” skincare line in 2023, and has generally made efforts to bolster its products’ authority; Heaf was excited about the recent approval of a 48-hour hydration claim on its body lotions.
To some in the greater beauty community, the combination of “Bath & Body Works” and “performance skin care” sends a shiver down the spine. (“Zero interest in the skin care but I will want to smell and test the sunscreens,” one Reddit user wrote.) A company insider said that new formats rank low among Heaf’s current priorities. While they help build the baskets of core customers, they’re less useful for acquiring new ones.
Back at Beauty Park, it was full steam ahead, as the company cooked up Fresh Balsam candles alongside two seasonal holiday scents. Alene Candles, a Beauty Park tenant and Bath & Body Works supplier, is shipping around 3 million candles weekly in preparation for the company’s biggest holiday of the year: not Christmas, nor Black Friday, but Candle Day, which falls right in the middle, and sees Bath & Body Works’ hero three-wick SKUs marked down to fewer than $10.
Wax is pumped from four-story silos into massive drums, where their fragrance is added, before they’re distilled into round glass containers that descend the factory line. An endless stream of scented candles slowly roll by, at a perfectly calibrated pace ensuring they cool by the time they’re ready to be labelled.
“People from the outside think, ‘It’s just crayons and string, right?’” said Brad Colclasure, the chief commercial officer of Alene Candles, “but there’s so much science that goes into this little bit of artisanship.”
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