Fragrances in India

PRE-COVID-19 PERFORMANCE

Growing brand consciousness attracts new entrants

Indian consumers became more brand conscious in 2019 although this trend has adversely impacted the growth of premium fragrances. While branding is obvious in some categories such as clothing, branding can be more challenging in premium fragrances in terms of making it visible to consumers.

Fragrances continues to be hampered by both black and grey market products

Both the black and grey markets pose significant challenges to the sales of industry players in fragrances in 2019. Grey channels are those where distributors/wholesalers illegally import legitimate brands of fragrances into the country without paying taxes.

Strategies vary among the leading brands in their bid to attract their target audiences

The Skinn brand by Titan witnessed robust year-on-year growth in 2019 to become the leading brand in mass fragrances. The brand endeavours to engage in a meaningful way with its customer base through ground events and digital media, with the exception of mass media advertisements.

2020 AND BEYOND

COVID-19 impact

Sales of fragrances are now expected to grow by 1% in 2020 in 2019 constant value terms in light of the impact of COVID-19. This compares to an expected 7% rise forecast for 2020 during research conducted at the end of 2019 before the spread of COVID-19.

Affected products within fragrances

All categories in fragrances are expected to see significantly slower growth in retail value sales at constant 2019 prices in 2020 over the previous year, as a result of the COVID-19 pandemic. The steepest declines in both volume and value sales at constant 2019 prices will be premium fragrances, particularly premium men’s fragrances, as consumers tighten their belts by forgoing these products entirely or down trading to lower cost alternatives.

Recovery and opportunities

Following the sharp decline seen in retail value sales at constant 2019 prices in 2020, due to the impact of the COVID-19 lockdown and increased economic uncertainty, the fragrances category is set to achieve some recovery in 2021. However, growth will remain muted for the remaining years of the forecast period with few categories returning to normal levels during this period in value sales at constant 2019 prices.

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