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The fragrance market is still tough, but looks to be doing slightly better than last year. BW Confdential analyzes the state of the category and what’s to come by Oonagh Phillips he fragrance market seems to be doing a more at niche brands and devoting more space Tlittle better this year. Prestige sales in four of to the category. Europe’s key markets (France, Italy, Spain and This trend towards the high end is seen as the UK) were up 2% in value to €1.92bn for the positive for the industry, as it is thought that frst half of the year, with good performances it will set a new tone for upcoming fragrance in Spain (+7%) and the UK (+3%), according launches. It is hoped that the trend towards to market-research company NPD. In the US better-quality fragrances will trickle down meanwhile, NPD says that prestige sales rose through the market and begin to be seen in 4% for the frst six months of the year. These more mainstream offers. In addition, major performances bode well for the rest of the groups, such as ELC, have begun focusing on year, and will likely see the market perform the premium end of fragrance, especially with its better than in 2014. Last year, total fragrance brands such as Tom Ford and Jo Malone. sales in Western Europe were up just 0.3% However, there is a downside. Many see the to $13.28bn (prestige sales rose 0.3% to sheer number of these fragrances now on the $9.87bn), while North America saw a sales market (448 niche scents were launched in increase of 2% to $6.54bn (prestige sales were up 2.9% to $5.72bn), according to Euromonitor It is hoped that the trend International. The total fragrance market rose 6% on a global basis last year to $45.93bn. towards better-quality fragrances will trickle down The high-end effect through the market and Niche, high-end collections and high-priced fragrances continue to be a major growth begin to be seen in more driver. The niche market, while small, is said to mainstream offers be seeing annual growth of 20%. This refects consumer demand for better-quality and more exclusive, original scents. The potential of 2014, according to Michael Edwards’ annual this market can be seen in some of the major guide Fragrances of the World) as contributing groups’ recent interest in the category. At the to increased pollution in the category and end of 2014, Estée Lauder Companies (ELC) creating more confusion for the consumer. acquired niche fragrance players Editions de The trend has also contributed to pushing Parfums Frédéric Malle and Le Labo, while at the prices up—indeed much of the value growth beginning of this year Puig bought Penhaligon’s in fragrance is due to these higher end lines. and L’Artisan Parfumeur. Shiseido too, acquired However, price hikes have been attributed to the trademark of the Serge Lutens brand earlier turning off some consumers and inciting retailers this year and is expanding the company‘s to discount to bring more consumers into their geographical reach. stores. Once reserved for certain periods of the The increased space retailers are now giving year, discounting has become an all-year-round these brands is also telling. Many department affair in some markets, and products that would stores began to create special niche spaces a never have been marked down in the past are few years ago, but this trend has intensifed, and now the subject of constant promotions. High credit: istock even perfumeries such as Sephora are looking prices have also seen more consumers opt n n n November-December 2015 - N°24 - BW Confidential 39