Strategy Briefing

Fragrances in Latin America

56 pages, Apr 2017

US$1,325

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About This Report

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Latin America is a core region for fragrance despite its developing status, worth more than North America in 2015 at USD$10.7 billion. Demand clearly exists but economic turbulence has been to the detriment of the category’s identity, as purchases were dictated by the times and circumstance and not by consumer choice. Improving retail infrastructure will lessen reliance on direct selling, which will lower barriers to entry and improve accessibility and variety, as well as premium’s plight.

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Overview

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Gain competitive intelligence about market leaders. Track key industry trends, opportunities and threats. Inform your marketing, brand, strategy and market development, sales and supply functions.

Solid market potential but yet to be realised

The fragrances market in Latin America is sizeable and prosperous, despite substantial macro-economic challenges. With fragrances fulfilling a multitude of roles in the lives of consumers, from gateway luxury purchase, to aspirational, to acting as an economical pick me up or gift, the category has sometimes benefited from its own pitfalls, but is yet to find its rightful permanent place in the everyday routines of the masses outside urban centres, alongside hair and skin regimes.

Mass-centric market a consequence of direct selling’s ubiquity

Mass accounted for 83% of the fragrances market in 2015, largely a consequence of price preference in Brazil, but also a direct result of a lack of competition and of product variety, or at least accessible product variety. Direct selling is the cause of this, as the leading distributor of fragrances in the LATAM region, which in most countries in the region takes more than half of value sales. Most direct sellers are positioned in the mass or masstige segment, giving consumers little choice in product or brands.

Health and beauty specialists helping to make the landscape fragmented

With a view to the future, the retail landscape will change. The emergence of beauty specialists and expansion into smaller urban centres will increase consumer awareness and choice, and will stimulate competition, providing a way in for international and niche players. Whilst this will inevitably open up the floor for the premium segment, it will be a long hard slog to convince consumers of the added value in a non-performance product.

Premium’s time in the spotlight is coming

That does not mean to say that premium will not gain ground. In fact, most forecast drivers, both soft and hard, will be of benefit to these luxury goods, including increasing GDP per capita, higher unit prices and rising consumer awareness. Ultimately, these indicators will pave the way for a 6% CAGR for premium fragrances between 2015 and 2020, compared with a 3% CAGR for mass fragrances.

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Introduction

Scope

Key findings

Regional Overview

Putting Latin America into context

Pace set to pick up but no signs of return to boom years

Argentina breaks through as the underdog

Mass eclipses but premium is on the up

Consumers eschew mass in Mexico

Market is underpinned by three fundamental geographies

Fragrance dominated by direct sellers

Speciality stores could benefit from knock-on footfall

Leading Companies and Brands

Fragmentation occurs with new distribution channels

Direct sellers losing where luxury is winning

Domestic players remain largely localised

Exposure to Brazil fortuitous for now

Forecasts

Mexico and Argentina jostle for second place

Staycations, men and millennials to aid premium’s plight

Headwinds and tailwinds to blow from all directions

Channel shifts benefit premium more over mass

Country Snapshots

Argentina: Market context

Argentina: Competitive and retail landscape

Bolivia: Market context

Bolivia: Competitive and retail landscape

Brazil: Market context

Brazil: Competitive and retail landscape

Chile: Market context

Chile: Competitive and retail landscape

Colombia: Market context

Colombia: Competitive and retail landscape

Costa Rica: Market context

Costa Rica: Competitive and retail landscape

Dominican Republic: Market context

Dominican Republic: Competitive and retail landscape

Ecuador: Market context

Ecuador: Competitive and retail landscape

Guatemala: Market context

Guatemala: Competitive and retail landscape

Mexico: Market context

Mexico: Competitive and retail landscape

Peru: Market context

Peru: Competitive and retail landscape

Uruguay: Market context

Uruguay: Competitive and retail landscape

Venezuela: Market context

Venezuela: Competitive and retail landscape

Appendix: Industry Forecast Model

About Euromonitor International’s Industry Forecast Model

Soft drivers and the Industry Forecast Model

Growth decomposition explained

Significance and applications for growth decomposition

Key applications for Industry Forecast Models

Why buy this report?

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Megatrends

Strategy Briefing

Fragrances in Latin America

New Report Guarantee

About This Report

New Report Guarantee

Overview

Why buy this report?

Solid market potential but yet to be realised

Mass-centric market a consequence of direct selling’s ubiquity

Health and beauty specialists helping to make the landscape fragmented

Premium’s time in the spotlight is coming

Want to find out more about this report?

Table of Contents

Introduction

Scope

Key findings

Regional Overview

Putting Latin America into context

Pace set to pick up but no signs of return to boom years

Argentina breaks through as the underdog

Mass eclipses but premium is on the up

Consumers eschew mass in Mexico

Market is underpinned by three fundamental geographies

Fragrance dominated by direct sellers

Speciality stores could benefit from knock-on footfall

Leading Companies and Brands

Fragmentation occurs with new distribution channels

Direct sellers losing where luxury is winning

Domestic players remain largely localised

Exposure to Brazil fortuitous for now

Forecasts

Mexico and Argentina jostle for second place

Staycations, men and millennials to aid premium’s plight

Headwinds and tailwinds to blow from all directions

Channel shifts benefit premium more over mass

Country Snapshots

Argentina: Market context

Argentina: Competitive and retail landscape

Bolivia: Market context

Bolivia: Competitive and retail landscape

Brazil: Market context

Brazil: Competitive and retail landscape

Chile: Market context

Chile: Competitive and retail landscape

Colombia: Market context

Colombia: Competitive and retail landscape

Costa Rica: Market context

Costa Rica: Competitive and retail landscape

Dominican Republic: Market context

Dominican Republic: Competitive and retail landscape

Ecuador: Market context

Ecuador: Competitive and retail landscape

Guatemala: Market context

Guatemala: Competitive and retail landscape

Mexico: Market context

Mexico: Competitive and retail landscape

Peru: Market context

Peru: Competitive and retail landscape

Uruguay: Market context

Uruguay: Competitive and retail landscape

Venezuela: Market context

Venezuela: Competitive and retail landscape

Appendix: Industry Forecast Model

About Euromonitor International’s Industry Forecast Model

Soft drivers and the Industry Forecast Model

Growth decomposition explained

Significance and applications for growth decomposition

Key applications for Industry Forecast Models

Why buy this report?

Want to find out more about this report?

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