Introduction to The Fragrance Market - The Smell the a Brand

“You can close your eyes, cover your ears, refrain from touch, and reject taste, but smell it an essential element of the air we breath. It’s the one sense we can’t turn off.” (Lindstrøm, 2010)

To understand the overall fragrance market it is important to define a fragrance and how this blog will have it’s focus. If you look up the word fragrance in the dictionary, the following words as; nice smell, pleasant odour, scent, perfume and cologne will be used as definitions. This blog will have the focus on fragrance as a product, such as a perfume or cologne, which is designed to emit a pleasant odour, but what is the typical smell of a brand?

The global fragrances market is worth approximately $8 billion $10 billion and according to global reports the fragrances market is forecast to reach about US$ 45,6 billion by 2018. The largest regional markets are Europe, Latin America and the US and Asia is a big growing market and the US emerges as the single largest market for premium fragrances followed by European countries including France and Germany (Estée Lauder Companies, Inc, 2013). The mature markets are North America with 34% of the global sale and Western Europe with 28% of the sales and the increasing market is the Asia Pacific with 24% of the sales. 

  

The signification of the brand smell is hard to grasp because the brand values and their connections to scents are concerned: What does classiness smell like and how does it differ between brand that consider themselves classy? It’s hard to characterise how material and immaterial are associated and combined in a perfume through branding (Pike, 2011, pp. 130-131). 
A fragrance development is usually involved in writing briefs, which describe an intended perfume in words and characterize the intended product with general characteristics, target group, price margins, and potential ingredients (Pike, 2011, p. 138).  A perfume is a tangible good and comes into effect in use, of being represented by a smell but with value added by several intangible illuminations (Pike, 2011, p. 130).  

For many years the women’s fragrances have been the leading overall market, which was related to beauty and fragrances. The women’s fragrances segment will continue to have a strong demand in the future and with more focus on innovative products. Another new focus will be concerning the men’s fragrances, which has been a hard segment to generate sales to.  Men’s perspective has changed to have more focus on looking attractive and smelling good and thereby is the segment expected to grow more than ever. Even though the fragrance market has been mature for many years by now and the growth in population have been limited, there are still some new options and new increasing demands from young men and women (Estée Lauder Companies, Inc, 2013). Furthermore there is an increased demand from customers for natural ingredients as well as for performance and functionality of fragrances and fragrance ingredients, shortening end product life cycle, increasing oversight of quality standards and labelling (JP Morgan and Jefferies International, 2014). These market trends will have an affect on the global fragrances market, such as the market growth rates have been 2-3 % over past decades and top four companies account for over 50% of the global market share, whilst top 10 account have 70% of the market share. 

A good fragrance is essential in today’s crowded marketplace, where consumers have so many choices (Arylessence, 2012). The worldwide market for fragrances and perfumes is a launch driven market with a large number of new product launches being witnessed every year (Estée Lauder Companies, Inc, 2013). To explain how huge market fragrances is and how much money there is used in this market the International Flavours and Fragrances (IFF) can be used as example. IFF are spending around $185 million annually to develop new smells for products like deodorants, shampoos and perfumes, and to create fresh flavours for snacks, packaged meals and drinks (Caplan, 2007).

Please keep following this blog and we will introduce you to the frangrances market, the history of fragrances, the biggest companies, why we buy fragrances and what is important for fragrance consumers, new segments for frangrances, the use of celebrity endorsement and at last we will go through some of the most important brands on the market such as Chanel Nr.5, Dior Homme & Hurt by Beyonce.

Happy readrings from,

FollowTheScent

References 

Arylessence. (2012 June). A Sensory journey: Fragrance in branding . Retrieved 2014 October from http://arylessence.com/: http://www.arylessence.com/pdfs/GCI1206_ASensoryJourney_FragranceinBranding.pdf

Caplan, J. (2007 09-May). Time. Retrieved 2014 12-October from www.time.com: http://content.time.com/time/specials/2007/perfume/article/0,28804,1618617_1618614,00.html

Estée Lauder Companies, Inc. (2013 04-March). Global Industry Analysts, Inc. . Retrieved 2014 12-October from www.strategyr.com: http://www.strategyr.com/PressMCP-2533.asp

JP Morgan and Jefferies International. (2014). International Fragrance Association North America . Retrieved 2014  12-October from www.ifrana.ord: http://www.ifrana.org/about-br/fragrance-industry/fragrances-market

Lindstrøm, M. (2010). Brand Sense. New York: Free Press.

Pike, A. (2011). In b. s. Senseing brands, Brands and Branding Geographies (pp. 125 - 141). UK: Edward Elgar Publishing Limited .