Western European fragrances remained the biggest regional market globally. However, growth was slowed by the Eurozone crisis, lack of product innovation and shift in consumer values. The market, which failed to address those needs is now starting to slowly offer a breath of fresh air to tired consumers thanks to the emergence of niche brands, stealing the show from traditional designer brands. The region remains a historic hub for fragrance-making with strong potential for growth to pick up.
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In a global context, Western Europe remained the biggest market between 2012-2017, with sales of USD13.5 billion in 2017.However, the market registered one of the slowest CAGRs, making it second last ahead of Eastern Europe.
The market’s performance is heavily influenced by sales of premium fragrances, while the mass market has been struggling to attract more demanding consumers in leading markets.
The Western European market’s slow growth over the 2012-2017 period was linked to two major factors: slow economic growth and euro crisis in countries such as Portugal, Greece, Italy and Spain and saturation of a market that struggled to provide product innovations to consumers.
Previously struggling economies such as Portugal and Spain are expected to gain momentum over the forecast period with highest CAGRs driven by soft drivers and increased GDP per capita.
The distribution landscape has struggled to renew itself and consumers are looking for alternatives. Online sales are surging and market players are investing in innovation labs such as Puig Future for example.
As consumers are growing more savvy and budget conscious, smaller pack sizes offer alternatives for niche and established brands to drive volumes.