Fragrances - US - September 2012

SCOPE AND THEMES
What you need to know
Definition
Data sources
Sales data
Consumer survey data
Advertising creative
Abbreviations and terms
Abbreviations
Terms
EXECUTIVE SUMMARY
The market
Figure 1: Total U.S. sales and fan chart forecast of fragrances, at current prices, 2007-17
Market factors
Aging population creates challenges, opportunities
Figure 2: U.S. population, by age, 2012-17
Hispanic, Asian populations growing and engaged in the category
Figure 3: U.S. population, by race/Hispanic origin 2012-17
Economy still struggling, but fragrance category gaining momentum
Figure 4: DPI, 2007-March 2012
Retail channels
Figure 5: Sales of fragrances, by channel, 2012
Key players
The consumer
Perfume has the highest use among traditional forms, but usage frequency is low
Figure 6: Fragrance usage, traditional forms— any, daily, or occasionally wear, May 2012
Line extension items add benefits, increase usage frequency
Figure 7: Fragrance usage, line extensions—any, daily, or occasionally wear, May 2012
Added benefits garner high consumer interest
Figure 8: Interest in product innovations, properties, May 2012
Young men are most likely to be interested in innovative product forms
Figure 9: Interest in product innovation forms—any interest, May 2012
What we think
ISSUES IN THE MARKET
How can brands sustain long-term growth (or brand loyalty)?
How will increasing regulation impact the category?
What role will technology play in the fragrance category?
INSIGHTS AND OPPORTUNITIES
Opportunity to add efficacy and value with added benefits
Beyond luxury
Natural and sustainable
Multicultural consumers, Millennials hold greatest opportunity
A sensory journey
TREND APPLICATIONS
Trend: Mood to Order
Trend: Extend My Brand
2015 Trend: Brand Intervention
MARKET SIZE AND FORECAST
Key points
Sales continue to recover after sharp declines during recession
Category expected to see sales growth through 2017
Sales and forecast of fragrances
Figure 10: Total U.S. retail sales and forecast of fragrances, at current prices, 2007-17
Figure 11: Total U.S. retail sales and forecast of fragrances, at inflation-adjusted prices, 2007-17
Fan chart forecast
Figure 12: Total U.S. sales and fan chart forecast of fragrances, at current prices, 2007-17
Walmart sales
MARKET DRIVERS
Key points
Aging population creates challenges for the fragrance industry
Figure 13: U.S. population, by age, 2007-17
Hispanic and Asian populations are growing and engaged in the category
Figure 14: U.S. population, by race/Hispanic origin 2007-17
Economic recovery slow but fragrance category growing
Figure 15: Thomson Reuters/University of Michigan’s index of consumer sentiment, 2006-Q2 2012
Figure 16: DPI, 2007-March 2012
Bath and shower products contribute to category growth
Figure 17: Total U.S. retail sales and forecast of soap, bath, and shower products, at current prices, 2006-16
Figure 18: Total U.S. retail sales and forecast of liquid body wash, at current prices, 2006-16
COMPETITIVE CONTEXT
Body care products add fragrance and skincare benefits
Consumers seeking scent through laundry
Figure 19: Interest in product innovations—Scent extensions—Any interested, May 2012
Experiencing fragrance without wearing it
Figure 20: Interest in product innovations—Scent Extensions—Any interested, May 2012
SEGMENT PERFORMANCE
Key points
Women’s and men’s segments showing healthy growth
Sales of fragrances, by segment
Figure 21: Sales of fragrances, segmented by type, 2010 and 2012
SEGMENT PERFORMANCE—WOMEN’S FRAGRANCE
Key points
Women’s fragrance segment healthy and growing
Sales and forecast of women’s fragrance
Figure 22: Sales and forecast of women’s fragrance, at current prices, 2007-17
SEGMENT PERFORMANCE—MEN’S FRAGRANCE
Key points
Men’s segment strong, but still recovering
Sales and forecast of men’s fragrance
Figure 23: Sales and forecast of men’s fragrance, at current prices, 2007-17
RETAIL CHANNELS
Key points
Growth driven by “other” channels, leads category in sales growth
Despite stronger commitment to beauty, drug stores lose share
Sales of fragrances, by channel
Figure 24: Sales of fragrances, by channel, 2010 and 2012
RETAIL CHANNELS—SUPERMARKETS
Key points
Supermarket sales continue to decline
Supermarket sales of fragrances
Figure 25: Supermarket sales of fragrances, at current prices, 2007-12
RETAIL CHANNELS—DRUG STORES
Key points
Despite efforts to improve beauty offerings, drug stores lose share
Drug store most popular retailer for men’s fragrance purchases
Figure 26: Drug store sales of fragrances, at current prices, 2007-12
RETAIL CHANNELS—OTHER RETAIL CHANNELS
Key points
Strong sales in the “other” segment are driving category growth
Women more likely to shop specialty beauty over FDMx channels
Other retail channels sales of fragrances
Figure 27: Other sales of fragrances, at current prices, 2007-12
LEADING COMPANIES
Key points
Category showing growth but sales decline in FDMx
Sales gains by Unilever and P&G driven by men’s segment
Manufacturer sales of fragrances
Figure 28: FDMx sales of fragrances by leading companies, 2011 and 2012
BRAND SHARE—WOMEN’S FRAGRANCE
Key points
Women’s fragrance struggles in FDMx
Mass fragrance products showing signs of success
Struggles continue for Coty Beauty in FDMx
Manufacturer sales of women’s fragrances
Figure 29: FDMx sales of women’s fragrances by leading companies, 2011 and 2012
BRAND SHARE—MEN’S FRAGRANCE
Key points
Men’s fragrance growth slows though faring better than women’s
Unilever and P&G continue to have success in men’s segment
Traditional cologne brands struggle in FDMx
Manufacturer sales of men’s fragrances
Figure 30: FDMx sales of men’s fragrances by leading companies, 2011 and 2012
INNOVATIONS AND INNOVATORS
 NEW PRODUCT LAUNCH TRENDS
Celebrity fragrances still hot
Unisex fragrances surge in popularity
Figure 31: Fragrance product introductions, by subcategory, 2007-12*
Body sprays
 PRODUCT INNOVATIONS
Location, location, location
Take me out to the ballgame
To the extreme
Get it while it lasts
MARKETING STRATEGIES
Overview of the brand landscape
Brand analysis: Chanel
Figure 33: Brand analysis of Chanel No. 5, 2012
Online initiatives
TV presence
Figure 35: Chanel, television ad, 2012
Brand analysis: Selena Gomez
Figure 37: Brand analysis of Selena Gomez, 2012
Online initiatives
Brand analysis: Curve Appeal
Figure 40: Brand analysis of Curve Appeal for Women and Men, 2012
Online initiatives
Print and other
FRAGRANCE USAGE OVERVIEW
Key points
Highest usage among lower-ticket items
Majority of scented products only used occasionally
Figure 42: Fragrance usage, May 2012
Fragrance wearers more likely to use all product forms
Figure 43: Fragrance usage, by fragrance usage, May 2012
Brand usage
Figure 44: Brands of perfume, cologne, and toilet water used, by gender, January 2011-March 2012
FRAGRANCE USAGE BY TYPE—TRADITIONAL FORMS
Key points
Highest fragrance usage among men and women aged 18-34
Figure 45: Fragrance usage—traditional forms, by gender and age, May 2012
FRAGRANCE USAGE BY TYPE—LINE EXTENSIONS
Key points
Lower-priced scented products lead the way
Figure 46: Fragrance usage—line extensions, by gender and age, May 2012
Aftershave more likely to be worn every day by older men
Figure 47: Aftershave usage, by male and age, May 2012
Old Spice most popular aftershave or cologne brand with men
Figure 48: Brands of aftershave lotion or cologne used, among men, January 2011-March 2012
TRYING A NEW FRAGRANCE
Key points
Smelling is the most frequent method for learning about fragrance
Word of mouth popular with young men
Figure 49: Steps taken before trying a new fragrance—learning about a scent, by gender and age, May 2012
Visiting retailers is the most popular way to try fragrances
Figure 50: Steps taken before trying a new fragrance—trying a scent, by gender and age, May 2012
PURCHASE LOCATIONS
Key points
Drug stores most popular purchase location, but losing ground to other channels
Figure 51: Fragrance purchase locations, May 2012
Specialty retailers most popular with young women; men more likely to shop at department stores
Figure 52: Fragrance purchase locations, by gender and age, May 2012
ATTITUDES TOWARD WEARING FRAGRANCE
Key points
Nearly half of fragrance wearers like to alternate between scents
Figure 53: Attitudes toward wearing fragrances, by gender and age, May 2012
FRAGRANCE PREFERENCES
Key points
Young women most overwhelmed by fragrance choices
Figure 54: Fragrance preferences, by gender and age, May 2012
Income impacts fragrance preferences
Figure 55: Fragrance preferences, by household income, May 2012
INTEREST IN PRODUCT INNOVATIONS—PROPERTIES
Key points
Added benefit fragrances could generate increased usage occasions
Figure 56: Interest in product innovations—properties—Any interested, by gender and age, May 2012
INTEREST IN PRODUCT INNOVATIONS—FORMS
Key points
Innovative product forms provide creative sampling opportunities
Figure 57: Interest in product innovations—forms—Any interested, by gender and age, May 2012
Young men express the highest interest in innovative product forms
Figure 58: Interest in product innovations—forms—Very interested, by male and age, May 2012
INTEREST IN PRODUCT INNOVATIONS—SCENT EXTENSIONS
Key points
Scent extensions create opportunity for lower-priced, value added items
Figure 59: Interest in product innovations—scent extensions—Any interested, by gender and age, May 2012
ATTITUDES TOWARD FRAGRANCE PACKAGING
Key points
Product refills improve value perception and support conservation
Packaging and product color can help support benefits
Figure 60: Attitudes toward fragrance packaging, by gender and age, May 2012
SCENT PREFERENCE
Key points
Fresh scents most popular with all respondents
Figure 61: Scent preference, by gender and age, May 2012
RACE AND HISPANIC ORIGIN
Key points
Multicultural consumers highly engaged in the category
Figure 62: Fragrance usage, by race/Hispanic origin, any wear or every day, May 2012
Figure 63: Brands of perfume, cologne, and toilet water used, by race/Hispanic origin, January 2011-March 2012
Black fragrance wearers like to experiment with fragrance
Figure 64: Attitudes toward wearing fragrances, by race/Hispanic origin, May 2012
Figure 65: Fragrance preferences, by race/Hispanic origin, May 2012
Asian and Hispanic fragrance wearers express interest in fragrance product innovations
Figure 66: Interest in product innovations—Any interested, by race/Hispanic origin, May 2012
CLUSTER ANALYSIS
Figure 67: Target clusters, May 2012
Cluster 1: Seekers
Characteristics
Opportunity
Cluster 2: Uninvolved
Characteristics
Opportunity
Cluster 3: Influencers
Characteristics
Opportunity
Cluster characteristic tables
Figure 68: Fragrance usage, by target clusters, May 2012
Figure 69: Fragrance preferences, by target clusters, May 2012
Figure 70: Attitudes toward fragrance packaging, by target clusters, May 2012
Figure 71: Interest in product innovations– Any interested, by target clusters, May 2012
Figure 72: Steps taken before trying a new fragrance, by target clusters, May 2012
Figure 73: Steps taken before trying a new fragrance, by target clusters, May 2012
Cluster methodology
CUSTOM CONSUMER GROUPS—TEENS
Key points
Aftershave use increases as male teens age
Figure 74: Use of aftershave lotion and cologne, by male and age, October 2010-November 2011
Axe is the most used brand among male teens, though usage drops with age
Figure 75: Use of aftershave lotion or cologne, by male and age, October 2010-November 2011
Cologne and perfume are preferred forms among teens
Figure 76: Use of perfume, cologne, and toilet water, by gender and age, October 2010-November 2011
Bath & Body Works tops the list for female teens
Figure 77: Use of perfume, cologne, and toilet water, by gender and age, October 2010-November 2011
Young female teens most likely to be influenced by celebrities
Figure 78: Attitudes about celebrities, by gender and age, October 2010-November 2011
Figure 79: Celebrity fragrance brand usage, by those who like to buy the same products that celebrities use, October 2010-November 2011
KEY HOUSEHOLD PURCHASE MEASURES—SYMPHONYIRI GROUP BUILDERS PANEL DATA
 OVERVIEW OF SHAVING LOTION/MEN’S FRAGRANCES
Consumer insights on key purchase measures
Brand map
Figure 80: Brand map, selected brands of shaving lotion/cologne/talc, by household penetration, 52 weeks ending June 26, 2011
Brand leader characteristics
Key purchase measures
Figure 81: Key purchase measures for the top brands of shaving lotion/cologne/talc, by household penetration, 52 weeks ending June 26, 2011
APPENDIX—OTHER USEFUL CONSUMER TABLES
Fragrance usage
Figure 82: Fragrance usage, by gender, May 2012
Trying a new fragrance
Figure 83: Steps taken before trying a new fragrance, by gender, May 2012
Figure 84: Steps taken before trying a new fragrance, by gender, May 2012
Purchase locations
Figure 85: Fragrance purchase locations, by household income, May 2012
Interest in product innovations
Figure 86: Interest in product innovations, May 2012
APPENDIX—SYMPHONYIRI BUILDERS PANEL DATA DEFINITIONS
SymphonyIRI Consumer Network Metrics
APPENDIX—TRADE ASSOCIATIONS