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Mass Picks Up Slack from Premium’s Decline

By: Carrie Lennard, Euromonitor International
Posted: November 5, 2010, from the November 2010 issue of GCI Magazine.

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Celebrity fragrance launches show no sign of abating. In the U.S., a new crop of A-list stars just put their names to new fragrances, and high-caliber U.S. stars are still queuing up to launch their own perfumes, suggesting the trend is far from over. In 2010, Halle Berry’s Pure Orchid and Avon’s Eternal Magic, a collaboration with Avatar’s star Zoe Saldana, are among the notable celebrity fragrance launches.

Despite the ongoing launches, however, the celebrity trend now seems to have peaked in some major markets. Over 2009–2010, the U.S. saw weaker demand for celebrity fragrances. These fragrances tend to appeal to young women who seek out these products to connect with their idols, and the products, therefore, typically have a very short shelf life as young consumers are quick to move on to the next hot star.

In the U.K., however, the celebrity trend is still thriving. Celebrity fragrances are set to drive growth over the medium term, particularly in mass women’s fragrances as the U.K.’s celebrity magazine and “WAG” (wives and girlfriends of footballers) culture remain pervasive.

Niche; Exclusive Launches May Help Segment

Despite the under performing global economy, there are still high-income perfume connoisseurs, typically older and more affluent consumers who are willing to spend more than $100 on a bottle of perfume. This interest in niche fragrances is developing as a backlash against the commoditization of fragrances and explosion of celebrity perfumes. Companies such as Bond No. 9 and L’Artisan Parfumeur have successfully tapped into this demand with super high-end scent launches. In the U.K. market, Dior launched a limited edition version of J’adore exclusively in Selfridges in November 2009. The product, priced at £700, was part of Selfridges’ centenary celebration.

Limited Edition Scents and Smaller Sizes

A common tactic employed by fragrance brands to drive sales is the introduction of limited edition or collectible fragrances. Gwen Stefani’s Japanese-inspired Harajuku Lovers perfume dolls have spawned several additional limited edition ranges—the Snow Bunny collection in winter 2009 and the Sunshine Cuties range in summer 2010. The originality of the range and strong appeal to tween and teen consumers have helped it gain popularity in markets such as the U.K.