Fragrance is deeply personal and so it follows that the women’s fragrance markets posted mixed results across the Big 5 in 2006 and 2007. Despite the prevalence of multinationals in the market, there are still marked differences between the Big 5. For example, the region is dominated by the big guns, with TNS Worldpanel placing Yves Rocher in the top spot, Chanel and Christian Dior in second and third place, respectively, and Avon and Cacherel in fourth and fifth. On a national level, however, the leaderboard changes dramatically. In Spain, for example, while Yves Rocher continues to hold the lead, it is Adolfo Dominguez who comes in second with Don Algodon, Eau de Rochas and Carolina Herrera following suit.
In Germany too, the consumer favors more home-grown talent: Jil Sander, Joop and Boss all feature in the German top five, while the French favor Kenzo, the Italians opt for Armani and the Brits are sweet on Elizabeth Arden.
The French have yet to be wooed by the mass of new product development that has hit the market during the past few years and yet again reported a loss, with ECM calculations based on figures from the Federation de la Parfumerie (FIP) suggesting that the market declined 2.3% in 2005 to $2.1 billion.
The huge selective channel is the culprit, falling 2.2% to more than $1.4 billion, and the less significant mass market dropped 4.5% to $131 million in 2005.
It’s no wonder French consumers are turning to the world of dreams for inspiration; no doubt manufacturers would like to lose themselves in a reverie given the poor prospects of a recovery. According to Margerie Barbes-Petit, brand director of Nina Ricci at Puig, The French are enticed by concepts that recall the magic and enchantment of falling in love.
“There is a fairy tale trend for sure,” she observed. “People want to escape from reality to a more dreamlike, colorful world. They know they have to deal with reality, but if they can they want to make it more pink and positive.”
Launches such as Nina Ricci’s Nina, which features a dreamy advertising campaign, and Anna Sui’s Magic Romance have made a splash on the French market for the ephereal element they bring to the mundane. Cofinluxe’s Salvador Dali Purplelips is further example of the French passion for the abstract.
In contrast, the more grounded Germans were tickled pink by the return of growth to the German fragrance market. The IKW reported a rise of 4.5% to $972 million in 2006, and IRI Germany is even more upbeat, valuing the market at $978 million, representing a 6.1% increase.
The Germans are more motivated by technology and modernity, as a Drom Fragrance spokesman told us: “The heritage of classic perfumery will go on to be reinterpreted either with minimalist cyber-chic constructions or with opulent, very rich bouquets of a more baroque nature. The first trend is incarnated by the color white, the incisive freshness of metal or the image of a futuristic plastic floral.”
Thus Germany has been visited by Davidoff Cool Water Game Happy Summer (Coty) in a glass flacon with a metallic finish shaped to mimic a cocktail and ckin2u, Coty’s first foray into developing the former UCI-owned Calvin Klein brand, a futuristic fragrance duo that also exists in the cyber world, Second Life.
Italians Want Glamor
In Italy luxury and glamor are more the watchwords of the year and the market has certainly benefited from some grown-up product launches in the past year. Unipro was delighted to announce a revival in the fortunes of the Italian perfumery sector. Women’s 2006 fragrance sales rose 4.5% to nearly $660 million. The perfumery channel was euphoric with a rise in consumption to the tune of 2.5%. No doubt this increase was helped by the big launches that the Italian market has hosted in the past year.
F by Ferragamo, for example, made its debut on the Italian market, with the F standing for Fetish, Fabulous and Fascinating and a flacon that mirrors the seductive curve of a high heeled shoe.
Seduction in France
Sensuality was also the name of the game for Chanel’s Allure Sensuelle, awarded best fragrance at the Italian equivalent of the Fifis, L’Accademia del Profumo. Armani’s Code (L’Oréal) was also big news and went on to win the award for the best advertising campaign at this year’s Cosmoprof.
While Italians concentrated on the adult world of seduction, youth was the name of the game in the UK, where sales surged an incredible 14.8% in the 52 weeks ending Feb. 26, 2007, according to TNS Worldpanel. This gain is the result of a rise in branded products, up 17% to take 100% of the market in 2006, and is also due to the impressive growth of fine fragrance—up 17% to take a 90.2% share of the market. In the mass market, times are considerably harder, as the UK consumer is trading up and looking for luxury—even if it does come at price.
The UK witnessed some very convincing new product development during the past year, with several fragrance houses launching entirely new scents, such as Belle en Rykiel, which made its debut on the UK market last month, Lanvin’s Rumeur and Guerlain’s Insolence. At the same time, UK consumers are very receptive to the celebrity market, which finds considerably less favor with its continental counterparts.
The celebrity market, says John Ayres, director of Pandora, is particularly useful as it hooks in a new consumer group that previously would not have bought fragrance at all. This means that the more traditional perfumery houses need not feel threatened. Indeed, when these new consumers have been initiated into the world of fragrance by the celebrity camp, there is a very good chance that they will go on to appreciate the scents produced by the prestige sector.
In Spain the situation is different again. The mass market is bouyant, rising 8.1% to $108 million, but the selective channel is no less successful, as sales for the first half of 2006 totalled nearly $154 million. The Spanish market is dominated by national manufacturers, such as Puig, owners of the Prada, Carolina Herrera and Nina Ricci licences.
Fragrance usage varies from country to country too. Some 74% of French women use fragrance in an average week, compared to just 44% of Italians. While sprays are the preferred format Europe-wide, balms, creams and solid perfumes are more popular in Germany and Spain than in the rest of the Big 5. Success in Germany and UK in particular is probably due to the greater penetration they enjoy among the 25-34 age group. This age group is the biggest consumer group for fragrance across Europe and probably holds the key to France’s losses. In France, penetration is higher among the older 35-44 age group.
Application May Vary
Europeans don't even agree where to apply fragrance on the body and in the home. In the UK, the majority of consumers (some 74%) apply fragrance in their bedrooms, whereas in Germany and France fragrance belongs in the bathroom. Perhaps the Brits see fragrance as a more seductive than functional product, which would explain why they are prepared to pay a premium for it. All consumers in the Big 5 agree that fragrance belongs on the neck, but 57% of Brits also apply fragrance on their wrists, compared to the 38% average across the Big 5, whereas the French are more likely to spray their clothes than their wrists. In fact Brits are far less likely to use fragrance anywhere but their neck and wrists than other Europeans, which means manufacturers are missing a trick when it comes to marketing ancillary fragrance products such as deodorants and body creams.
With the exception of France, it was a good year for the European fragrance markets. Manufacturers are doing stirling work to open up niche areas and encourage new consumer groups to purchase fragrance products.