According to The NPD Group, a market research company specialising prestige cosmetic products, the prestige fragrance industry showed robust sales of 1.6 billion dollars (1.24 euros) in U.S. department stores year-to-date (January to September 2012), with men’s fragrance sales growing slightly faster than women’s.
New market dynamic
Designer fragrances, which accounts for nearly three quarters of the total U.S. market, grew the same rate of the overall category performance, while jewellery and niche prestige fragrances almost tripled. Jewellery fragrance brands like Boucheron, Bulgari, and Cartier and niche fragrance brands like Creed and Jo Malone helped to take this segment of the fragrance category to double-digit growth in the first nine months of the year.
“The fragrance brands that are being sold in more selective distribution are experiencing explosive growth. We’ve seen this trend with high-end designer brands like Tom Ford and Jimmy Choo and this is also evident today with jewelry and niche fragrance brands,” said Karen Grant, vice president and senior global industry analyst, The NPD Group. “Even though niche and jewelry brands make up only nine percent of the total prestige fragrance market they are creating a new dynamic in the larger fragrance arena. They are growing faster than any other type of fragrance in the prestige space and their combined sales are actually more than double the size of prestige celebrity fragrances.”
Higher prices
In addition to niche and jewellery brands experiencing the largest dollar growth, they generate sales at one of the highest average price points in the prestige fragrance market. While the average price in women’s and men’s for these fragrances are about 70 US dollars, selections in this space may be in excess of 350 US dollars and leading brands are often in the 200 US dollars range.
“It is quite a compelling story that despite the economic uncertainties that prevail, we continue to see sizable pockets of growth in prestige fragrance. And, when one considers the price, these fragrances are often treasures and truly an investment,” said Grant. “Yet, if we were to compare the scope of the premium market in countries like France, the U.S. still has significant opportunity to expand sales further in this frontier. Consumers are continuing to invest where they see the value,” ended Grant.
Source: The NPD Group
