Saturday, 23 February 2013

What is good - Perfume statistics

Below is a little fragrance market research i did investigating the retail sales of perfumes in various different countries to be able to compare high and low sales. 

United Kingdom  

Executive summary

Trends 

In 2011, retail sales of fragrances in the UK grew by 7%, to reach £1.1 billion. This was slightly less than the 8% value growth in 2010. The slight slowdown can be attributed in part aggressive competition amongst retailers, for example, companies like Perfume Shop and Debenhams are providing a lot of price promotions to encourage consumers to purchase, especially fragrances.

Competitive Landscape

Coty UK Ltd, Procter & Gamble UK Ltd and Prestige & Collections Ltd lead the fragrances industry in the UK, with value shares of 15%,12% and 7%, respectively. Fragrances is quite a fragmented category, and the brand ranking tends to change year-on-year based on new product development, brand extensions and marketing spend.

Prospects

Over the forecast period, fragrances is expected to see a constant value CAGR of 3%, to reach £1.3 billion at constant 2011 prices. Growth will come from consumers looking to treat themselves with premium fragrances. Targeted new product launches with higher marketing/advertising spend will enable manufacturers to push brands in the market.


United States of America  

Executive summary

Trends 

Fragrances achieved strong growth in 2011. After experiencing a steep 7% decline in 2009 and recovering by 2% in 2010, sales of fragrances increased by 8% in 2011. Sales of fragrances declined in 2009 due to the economic downturn, as consumers of all economic levels restricted gift-giving and self-purchasing. With an improving economy, high-income consumers felt comfortable spending on themselves and on others once more. As a result they returned to purchasing discretionary items such as fragrances. In turn, total sales of fragrances increased by 8% in 2011, to reach US$5.8 billion.



Competitive Landscape


Coty was the leading player in fragrances in 2011, with a 13% value share, down from 14% in 2010. The company is strong in both mass and premium fragrances. In the mass segment Coty markets a wide range of established strong brands, such as adidas, Jovan and Stetson. It also has a significant presence in the premium segment with its Calvin Klein fragrances. The company has been successful with its Marc Jacobs, Vera Wang and Kenneth Cole fragrances, licensed from successful fashion designers. Celebrity fragrances have been the main focus of the company, as it launched fragrances from Jennifer Lopez, Celine Dion, Sarah Jessica Parker and Tim McGraw. Despite introducing new fragrances such as Beyoncé, Celine Dion Signature, cK One Shock, David Beckham Homme and Heidi Klum Shine, Coty lost share in 2011 due to its underperformance in its mass fragrances division.

Prospects

Retail sales of fragrances are forecast to increase by 6% in constant value terms over the forecast period, to reach US$6.1 billion. This is a much better performance than the 13% constant value decline in the review period. The 2008/2009 recession contributed to the 13% decline over 2006-2011, and the US economy is expected to make a recovery over the forecast period. Due to ongoing product innovation in the premium segment, high-income Americans appear to have regained their interest in fragrances. Premium niche fragrances which are sold in limited distribution channels allow affluent consumers to feel that they have made a discovery. At the same time, manufacturers of fragrances will need to address consumer apathy and confusion. There has been an explosion in the use of scents beyond fine fragrances, with everything from hand dishwashing soap to fabric softeners to women’s razor handles now infused with scents. As a result, fragrances have lost their mystique and become less “special” and commoditised. With more than 100 new launches of fragrances a year, the glut of fragrances in the marketplace has also created consumer confusion. The saturated environment in fragrances has arguably contributed to consumer confusion and apathy, making it very difficult to make a brand stand out.

China 


Executive summary

Trends 

Fragrances registered a 12% increase in current value terms in 2011, which was much higher than value sales growth in previous year, of 8%. The main stimulus for this dynamic growth rate came from the overall recovery of new launches in China’s fragrances market in 2011. New SFDA regulations in April 2010 meant a longer period for the new fragrance product registration process, as well as more ingredients being banned, which slowed down new product development in 2010 and early 2011. With more efforts having been made by manufacturers in product R&D, more new launches appeared in China’s fragrances market in 2011, contributing to the category’s dynamic growth.



Competitive Landscape



The fragrances category is very fragmented in China, with no manufacturer having a value share greater than 6% in 2011. Mass women’s fragrances is particularly fragmented, with many small manufacturers present. As many female consumers are keen to find an individual and distinctive fragrance, it is common for low or middle-income female consumers to try smaller players’ fragrance products, with relatively affordable prices.


Prospects


The fragrances category is expected to register strong growth over the forecast period, with a CAGR of more than 8% in constant value terms. The improvement in people’s living standards and rising personal disposable income levels will mean that a wider range of consumers will regard fragrances as a necessary beauty and personal care product, especially when socialising. Most of the leading market players have been paying great attention to reinforcing their market penetration and improving distribution networks, and many high-end fragrance brands are expected to gain a stronger presence in lower tier cities, such as Yixing and Jiashan, as well as in rural areas. Steadily increasing market demand and efforts by manufacturers will encourage the further development of China’s fragrances market over the forecast period.


Australia 


Executive summary


Trends 

The high Australian dollar, coupled with the increased popularity of internet retailing, changed how consumers shopped for fragrances. They visited department stores to try fragrances which they had shortlisted, and subsequently visited online retailers of fragrances to purchase at a lower price. In store-based channels, premium fragrances appeared in chemists/pharmacies which were brought in as parallel imports from foreign markets, with their prices very attractive due to the strength of the Australian dollar.


Competitive Landscape


In 2011 Coty Australia continued to lead fragrances with a 7% value share. The company is present in premium fragrances with brands such as Joop! and celebrity lines including Jennifer Lopez and Sarah Jessica Parker. Coty also distributes Calvin Klein, Marc Jacobs and Davidoff fragrances in Australia. Coty is recognised as a world leader in celebrity fragrances, and has constantly signed partnerships with A-list celebrities to endorse its fragrances.

Prospects

Fragrances is expected to record declining value sales in the forecast period due to retailers’ heavy emphasis on price promotion. Price discounting is sustainable and widely adopted due to the increase in stocking parallel imports. Local retailers will need to compete with the efficiency of internet retailing, where fragrances are sourced from the lowest cost supplier, located anywhere in the world. The forecast continued strength of the Australian dollar will allow consumers to maximise their purchasing power and to find lower prices for fragrances. Volume sales of fragrances are projected to see higher growth in the forecast period, as unit price decreases will encourage higher demand.


France


Executive summary

Trends 


In 2011, classic lines experienced strong growth as fragrance houses have been investing more in their big classic brands in terms of communication and advertising, and retailers have been prioritising their visibility in shops and perfumeries.



Competitive Landscape

Fragrance is a brand-orientated category with fierce competition. Thus, the competitive environment remained extremely fragmented in fragrances, with the top five companies accounting for a combined 41% value share in 2011. Chanel SA led overall sales of fragrances in France, accounting for an 11% value share in 2011. The company was followed by Christian Dior and Guerlain SA with 11% and 8% value shares, respectively.


Prospects

Over the forecast period, sales of fragrances are predicted to see very marginal positive growth. Sales will be impacted by the bleak prospects of the economy; more particularly in the eurozone. Sales of premium men’s fragrances still lag behind their equivalent for women but should see stronger growth, thanks to the current fad for men’s grooming products and the recent explosion of male celebrities in advertising.

Source:http://www.euromonitor.com/fragrances

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