Fragrances in Guatemala

PRE-COVID-19 PERFORMANCE

Slowing demand for fragrances due to unstable economy in 2019, while alternative beauty and personal care products offer competition to mass segment

Fragrances continued to record declining demand and slowing current value growth in 2019, driven by the largest mass segment. With concerns over the economy and political instability at the end of the review period, many low- to mid-income consumers did not perceive fragrances as an essential purchase, leading to marginal declines in volume terms for both mass men’s and women’s segments.

Affluent consumers tend to be brand loyal, supporting marginally stronger performance of premium fragrances

The one positive performer in volume terms within the category was the niche of premium men’s fragrances; premium products hold notably higher value share within fragrances compared to most other beauty and personal care categories apart from skin care, with more affluent consumers prepared to invest in fragrances that carry a certain element of kudos.

Direct selling dominates fragrances due to the offer of mass products, while premium brands find distribution through beauty specialist retailers and department stores

Fragrances in Guatemala continued to be dominated by direct sellers in 2019, led by Scentia Perfumeria SA, as these players tend to offer mass products, which remain the most popular segment within the category due the high proportion of lower- and mid-income consumers in the country. Leading direct selling brands Scentia and LeCleire both gained value share in 2019, due to their presence in the mass segment, while third-ranked Avon continued to lose ground, as it struggled to attract consumers to its fragrance portfolio.

2020 AND BEYOND

COVID-19 impact

Value sales of fragrances are now expected to decline by 11% in 2020 at constant 2019 prices in light of the impact of COVID-19. This compares to an expected 1% rise forecast for 2020 during research conducted at the end of 2019 before the spread of COVID-19.

Affected products within fragrances

Double-digit volume declines are predicted for all areas for fragrances in 2020 in Guatemala across men’s, women’s and unisex for both mass and premium segments in addition to fragrance sets/kits, which are only available for the mass segment. With consumers forced to remain at home for long periods of time, even more affluent consumers, restricted in their movements and unable to socialise, are unlikely to deem these products essential.

Recovery and opportunities

Normalisation in terms of purchasing behaviour for fragrances is not expected to return until 2022, with a slower recovery predicted for mass women’s fragrances, as it is set to record weaker volume growth compared to the other segments.

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