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Market researchers Global Industry Analysts, Inc. (GIA) released of a report on the fragrance and perfume markets that predicts that by 2017, the global fragrances and perfumes market is projected to cross $36 billion, driven by emerging demand from developing markets and growing importance of personal appearance and grooming among consumers. Further, the introduction of new consumer segments including young children and babies and the launch of niche products, such as fragrances containing natural, environmentally friendly ingredients, is expected to set the pace for rapid market expansion.
Also according the GIA report, although a growing market, the global fragrances and perfumes market does not reflect consistent growth across geographic regions. Regional variations in growth reigns supreme given the market's dependence on a country's GDP, standard of living and level of disposable income. Being largely consumer driven, growth in the fragrances and perfumes market is influenced by demographic perception of style, luxury and status/prestige. The market posted marginal-to-flat sales pattern during the period 2008–2009 driven by cautious consumer approach. In developed countries, the fragrances market recorded decline in sales even before the onset of the economic crisis, which only worsened further with consumers holding back spending on discretionary purchases. However, the decline in sales was offset by the stable growth patterns in emerging markets of Asia-Pacific, Latin America and Eastern Europe. Future growth in the market is expected to be fueled by growing popularity of customized fragrances, changing demographics, increasing number of singles and growing awareness of fragrances among male customers. Teenagers represent the most lucrative demographic consumer cluster, followed by the baby boomers, who are major customers in the important luxury brand sector. The market is expected to also witness increasing roll out of natural, environmentally friendly ingredients and fragrances. Growth is expected to remain high in the personalized, high-profile celebrity perfumes segment.
As stated by the market research report, Europe represents the largest market, with European consumers ranking among the finest of connoisseurs of fragrances and perfumes. Carrying out their legacy, European companies continues to dominate the global market and produce most of the world's most desirable brands. Penetration of men's fragrances and perfumes also rank high among European males with an estimated 75% of men utilizing aftershave/male fragrance. In Italy, Romania and Slovenia, the percentage of men utilizing fragrances far outstrips women.
In Asia, despite the presence of developed markets, including Japan, the per capita consumption in the region, excluding Singapore and Hong Kong, lies below the world's average. Major attributes for the low consumption in the region include economic conditions and customs that relate use of heavy scents with the covering of body odor. Currently on the global radar are low penetration markets such as China, and Japan, where huge untapped opportunities are the focus of large international players. Given the increasing willingness among Asian women to use a famous brand to improve their image, opportunities abound in these markets.
In the report, GIA included key market participants such as Avon Products, Inc, Bulgari S.p.A, Chanel SA, Coty, Inc., Elizabeth Arden, Inc., Estée Lauder, Inc., Gucci Group NV, Gianni Versace S.p.A, L'Oréal SA, LVMH Group, Procter & Gamble, Puig Beauty & Fashion Group S.L, Polo Ralph Lauren Corporation, and Revlon, Inc. And more information on this report can be found at this link.