Mature fragrance markets have settled into a steady pace and are gearing strategies towards creating meaning and value, sacrificing short-term gains for long-term loyalty. Meanwhile, emerging hotspots represent a mixed bag of opportunities, with Latin America being an extreme case of value over everything. Multinationals are seeking growth in global expansion but few have broken down cultural barriers. However, resistance is futile, seismic shifts are occurring and the industry must adapt.
At 5.5% growth in 2016, the fragrance industry reached its peak over 2011- 2016 period. The industry sat well ahead of the wider beauty market and only one percentage point behind dynamic colour cosmetics.
Developed markets bore the brunt of the dramatic reprioritisation of consumer agendas, Western Europe and North America delivering growth rates of 2.3% and 2.5%, respectively. A refined sense of self, heightened sophistication and conscious consumption habits all benefited premium but dented mass.
Genderless scents had another good year, also, on the back of societal shifts, as the blurring of gender roles continued to reinvigorate the lackluster unisex category, delivering 4% value gains.
Simplifying formulations and acting with integrity appeals to consumers the world over. Increasingly discerning long-time wearers of fragrance are scrutinising bottles and looking for safer alternatives.
In a quest for differentiation in a generation, and industry, mired by homogeneity and lack of creativity, personalised scents continue to grow in popularity. Premium offerings need refining and mass options need discovering but regardless, technology and big data will play a crucial role.
Mass outgrew premium in 2016, a pattern that is set to endure to 2021. However in market weight, fragrance will remain premium’s domain, as niche and bespoke offerings hike up unit prices and maintain relevance.
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