Fragrance is one of the few European beauty markets where premium brands dominate, accounting for approximately 70% of sales; premium fragrances are regarded by many to be aspirational, yet affordable. Even during the economic downturn, consumers preferred to trade up to more expensive brands with perceived cachet, rather than save a few euros on a cheaper mass version. In fact, a recent trend for larger sizes is evidence that premium fragrances can be seen to offer remarkable value for money.

After several years of flagging sales, the men’s and women’s fragrance category picked up across Europe in 2014. According to Datamonitor, the European fragrance market grew 2.2% last year to exceed $10.8 billion. NPD Group, which focuses on premium fragrance, read the UK as the fastest growing market up 3%, while sales edged forward 0.5% in Italy, increased by just 0.2% in France and dropped 1.5% in Spain. Total sales for the four major European countries were valued at nearly $6.4 billion in 2014.

Consumer usage of fragrance varies country by country, according to Kantar Worldpanel. Three out of four Spanish consumers use fragrance, reflecting a strong culture for lighter versions that are used by many on a daily basis as part of the grooming routine.
The French are also keen fragrance users, with 68% using, compared to just 52% of UK consumers. France is arguably the most sophisticated fragrance market in Europe, as 41% of people prefer to use more intense eau de parfum, compared to the European average of 33%.

Fragmented Fragrance
The fragrance launch rate has accelerated tremendously during the past decade, especially within the women’s fragrance category. According to Michael Edwards’ Fragrances of the World 2015, there were 1,620 new fragrances launched globally in 2014, more than half of them for women.

A reason for such proliferation is due to the increasing number of flankers and limited editions, which represent a third of all fragrance launches. They are an easy route to market and are less risky than investing in the creation of a new brand franchise.

Although there is a danger that flankers can damage the credibility of a brand, done properly they can attract new users and boost interest in the original fragrance. P&G’s Boss is master of reinvention with its multiple variants for Hugo Boss Bottled. Its most recent flanker, Hugo Boss Unlimited, is presented in a striking white bottle with green lettering.

Fragrance brands are starting to explore new formats, such as hair fragrance and loose powders. Not quite flankers, they help to focus the attention back onto a classic brand. Chanel, for example, has never launched flankers, but has extended the franchise of the best-selling No.5 and Coco Mademoiselle in this way.

Celebrity fragrances occupy a small but growing segment of the European fragrance market. They are most prolific in Germany and the UK and appeal to the youth demographic. German celebrity best-sellers include fragrances from Christina Aguilera (P&G), and Coty Beauty’s Katy Perry, Beyoncé and Heidi Klum. In the UK, pop group One Direction’s One Moment was the best-selling fragrance of 2013 and continues to perform well. Lady Gaga’s Eau de Gaga (Coty Beauty) is another success story. However, not all celebrity fragrances hit the mark, as Elizabeth Arden has discovered with disappointing sales for its Taylor Swift and Justin Bieber scents.

Niche brands launches have also been prolific, with 448 recorded by Fragrances of the World in 2014. They are widely credited with setting the agenda for originality in terms of their use of unusual ingredients and original compositions.

At the end of 2014, there were several high profile niche brand acquisitions, including Parfums Editions Frédéric Malle and Le Labo by Estée Lauder and L’Artisan Parfumeur and Penhaligons by Puig. According to Edwards, niche is growing up, but the large number of new small fragrance houses do not necessarily equate to a credible pedigree in fragrance.

“As more niche brands appear, only the truly artisanal and original will survive, resulting in a shake-up of the category,” he predicted.

Fragrance Allergen Proposals
The European Commission has proposed measures to protect EU consumers from potential fragrance allergens in cosmetic products, stating that they must be individually labeled on packaging. The proposal led to fears that it would spell the end for classic fragrances such as Chanel No.5 and Miss Dior.

EU officials have sought to allay these concerns by confirming that the constituent molecules of ingredients such as oak moss will be banned, not the ingredient itself. However, formulators argue that the fragrance industry is being unfairly targeted and that perfumes forced to reformulate using synthetics according to the new rules will no longer smell the same and lead to a new style of fragrance.

Olfactive Trends
Certain fragrance types remain popular whatever trends might produce in terms of new ingredients or creative combinations. Florals are a perennial favorite, especially among UK consumers, who prefer white floral notes. The trend for single floral notes, such as rose, lily of the valley and narcissus, is also well established.

During the past five years, there has been a strong move toward fragrances containing oud, not just in the men’s but also women’s market. Although it is an ingredient, the term oud is used to describe a type of fragrance and is used by fragrance houses even if it is not part of their philosophy.

Examples include Jo Malone Oud & Bergamot and Al Oudh by L’Artisan Parfumeur.

Customization is an emerging trend but usually an expensive option for those looking for bespoke fragrance. A new invention from the Czech Republic taps into this opportunity with Inglot Freedom System Fragrance, a solid fragrance that comes in five different fruity and creamy perfume options: Golden Wood, Green Fruit, Purple Mask, Mandarin Crush and Bright Amber.

The fragrances are packaged in separate white palettes connected with magnets and are designed to be used separately or mixed together according to individual preference.

With more than a thousand new scents to choose from, dozens of classics still on store shelves and do-it-yourself blends to concoct, it’s obvious that there’s a scent for every nose!

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Imogen Matthews
Headington, Oxford UK
Tel: +44 1865 764918

Imogen Matthews is a respected consultant, journalist and researcher focusing on trends in the beauty industry. She regularly contributes to many of the world’s foremost beauty trade titles. Every year in April, she publishes The Premium Market Report, focusing on trends in the UK premium beauty markets.
www.thepremiummarketreport.com