How Will Fragrance Fare?

“Gift sets have often provided a somewhat stress-free purchase for the shopper to get in and out of the madness that surrounds shopping during the holiday season,” says Karen Grant, vice president and senior global industry analyst, The NPD Group. Indeed, the global market research company’s annual holiday retail study for 2012 showed that fragrance moved from the number eight position up to number six of the top gifts on consumers’ holiday shopping list. In the U.S., prestige women’s fragrance gift sets had a 9% sales increase in the first quarter of 2013—arguably buoyed by Mother’s Day offerings priced more than $80.

Overall, prestige fragrance was up by 4% in the U.S. for the first half of 2013.

However, only time will tell how fragrance gift sets sell in Europe this holiday season. The category has declined by at least 2% in Spain, Italy and France so far in 2013. “The markets in the Eurozone face greater challenges, but, with the exception of Spain, most markets are continuing to show increases in average selling price across all categories,” says Grant. “This tells us that while consumers may be cutting back in spending, they are continuing to invest in value—even when that may be at higher prices.”