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As the United States slowly moves out of the recession, fragrance demand up to 2017 is forecast to remain ahead of only the hair care sector, but well behind other mature sectors such as men's toiletries, suncare and oral hygiene, according to market research firm Canadean.
Although the U.S. economy is expected to make a strong recovery from its recessionary state leading up to 2017, consumer demand for fragrances remains relatively weak, according to a new report from Canadean. With a volume Compound Annual Growth Rate (CAGR) of 0.9%, the sector is forecast to be one of the slowest growing in the U.S. health and beauty industry to 2017.
Value growth is expected to be higher, at 1.6%. However, the value of mass fragrances across women's, men's and unisex fragrances categories will grow faster than premium fragrances, showing that value growth is being driven by trading-up within the mass market.
Men's fragrances is the second largest category in the U.S. fragrances sector with a 30.9% share of the market in 2012 in both value and volume terms, but it is forecast to be the fastest growing to 2017. Both value and volume are projected to increase above the line at 1.7% and 0.9% respectively. The share taken by women's fragrances in 2012 was double that of men's products, at 66.4% of the market. Category growth is forecast to be slightly lower than that of men's fragrances, although it will mirror the sector average for both value and volume CAGR. Unisex fragrances took 2.6% of the market and has a projected value CAGR of 1.6% to 2017. Volume growth is expected to be slightly better than the sector average, at 1.0% for the same period.
Hypermarkets, supermarkets, department stores, drug stores and pharmacies together accounted for almost three quarters of all fragrances distribution in 2012. While all three channels witnessed improved share, it was health and beauty stores which saw the best growth, likely indicating a move towards more niche products at a premium price.