US Fragrance sales slow as demand stutters

By Andrew MCDOUGALL contact

- Last updated on GMT

US Fragrance sales slow as demand stutters

Related tags: Ralph lauren

The US fragrance market has taken a hit as sales dry up due to low demand, and figures just simply can’t meet those driven by the exceptional growth seen in the previous year.

Having charted a solid performance in 2011, growth dropped off in 2012, as the market could not repeat the high levels of demand and extensive product innovation that led to a good performance the previous year.

Fragrance sales in 2011 had benefited from higher-income shoppers who felt more comfortable spending on others and themselves as the economy improved, but with no celebrity must-have perfumes on the market in 2012, it suffered.

Struggle

Although the US economy is expected to make a strong recovery from its recessionary state leading up to 2017, consumer demand for Fragrances remains relatively weak, according to a new report from Canadean.

With a volume Compound Annual Growth Rate (CAGR) of 0.9 percent, the sector is forecast to be one of the slowest growing in the US Health & Beauty Industry over the coming years.

Female Fragrance remains the largest segment of the market, but it is the men’s category that is expected to post the better growth.

Market leader

L'Oréal USA was the leading player in fragrances last year, and is strong in premium men’s fragrances through the number one men’s fragrance brand Acqua Di Gio Pour Homme as well as classics Drakkar Noir and Ralph Lauren Polo for Men.

In premium women’s, the company focuses on three major brand families - Lancôme (Trésor, Miracle), Ralph Lauren (Romance), and Viktor & Rolf (Flowerbomb).

Opportunity and caution

The market was one of the ones affected heavily by the recession, yet there are some glimmers of hope, particularly with niche fragrances.

The appeal of this category in the premium segment is due to affluent consumers appearing to have regained their interest in fragrances, and with products sold in limited distribution channels, the consumer is made to feel that they have made a discovery.

At the same time, manufacturers of fragrances will need to address consumer apathy and confusion, as scents have been used well beyond fine fragrances, with everything from hand dishwashing soap to fabric softeners to women’s razor handles now infused with a smell.

As a result, fragrances have become less ‘special’ and commoditized, and with the growing number of new launches per year, the market has become saturated, making it difficult for a brand to stand out.

Related topics: Market Trends, Fragrance

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