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Fine fragrance has suffered the effects of fewer shoppers buying fewer fragrances as a result of the global financial crisis, particularly in the developed world. As a consequence, retailers are destocking and brands are putting new launches on hold. As a recent NPD Group report put it, “2008 was different.”
Refocusing the Fine Fragrance Market
Last year, NPD notes, US prestige fragrance sales totaled $2.68 billion, down 6% from 2007. Women’s sales dropped 5%, while men’s fell 8%. “However,” the report states, “sales of higher priced gift sets (those priced from $60 to under $100) were a bright spot for the fragrance category.” These higher priced fragrance gift sets represent 65% of 2008 gift set sales, up from 40% in 2005. This “sweet spot,” as NPD calls it, has “grown in both dollars (+12%) and units (+11%) and posted double-digit growth in 2008.” Simultaneously, men’s launches decreased 20%, while women’s actually rose 9%, notably Viva La Juicy, Estee Lauder Sensuous, Ed Hardy and the Harajuku Lovers collection.
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