Fragrances in Indonesia

PROSPECTS

Tightening cash flow has a major impact on sales of fragrances

Fragrances saw a lower current value growth rate than both colour cosmetics and skin care in 2018. Consumers tightened their cash flow in 2018, and fragrances was the most likely product to be cut from consumers’ shopping baskets, since they depend more on deodorants than fragrances; many people still regard fragrances as non-essential.

Roll-on fragrances fulfil the demand for compact and travel-friendly fragrances

Strong growth in travel and higher mobility led roll-on fragrances to gain popularity. Some brands that are quite popular with their roll-on fragrances are Victoria’s Secret, L’Occitane and Etude House.

Men offer potential for growth

Following the trend of a metrosexual lifestyle, male consumers are expected to become a promising target group. This is also supported by strong growth in gym membership, higher interest in fashion and hair styles, and increasing willingness to pay for fashion products.

COMPETITIVE LANDSCAPE

Discounts and promotions are the backbone of fragrances marketing

According to trade interviews, Indonesian consumers of fragrances tend to have a low barrier to change – they are open to trying new fragrances. However, this also means that they can easily change their fragrances and are not brand-loyal.

Mass fragrances sees slower growth than premium fragrances

As the tightening of cash flow is happening mostly at the middle to low- end of the market, mass fragrances brands saw slower growth than premium fragrances brands in 2018. This was also confirmed by trade interviews.

New regulation on imported brands affects mass but not premium fragrances

Premium fragrances is dominated by global brands, with no significant local brands. For this reason, the new regulation on taxes for imported goods did not affect the competition in premium fragrances, since all products had the same taxes applied.

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