Fragrance and Perfume Market Estimated to Witness High Growth owing to Increased Spending Capacity of Middle-Class Population
The fragrance and perfume industry uses natural as well as synthetic ingredients to create pleasant scents for personal care products. Perfumes usually contain a middle note derived from flowers, herbs, or spices; top notes that are usually citrus or fruity to create an initial impression; and base notes consisting of musk, vanilla, or wood to anchor the scent. Popular synthetic ingredients used include galaxolide, habanolide, and tonalide. Companies operating in this space manufacture eau de parfums, eau de toilettes, body mists, colognes, and fragrance creams for both personal and commercial applications.
The global fragrance and perfume market is estimated to be valued at US$ 53.85 Bn in 2023 and is expected to exhibit a CAGR of 4.2% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
One of the key drivers for the growth of the fragrance and perfume market is the increased spending capacity of middle-class population, especially in developing regions of Asia Pacific and Latin America. As economies in these regions continue to grow steadily, more consumers are able to spend disposable income on luxury grooming and personal care products. This has led to high demand for premium fragrances and perfumes among younger demographics. Moreover, the growing working-class population coupled with rising fashion consciousness has further popularized different types of fragrances for both personal and professional use. Various developments in fragrance composition technologies have also enabled perfume makers to launch new products catering to dynamic consumer preferences.
SWOT Analysis
Strength: The fragrance and perfume market enjoys strong brand recognition and loyal customer bases for leading brands. Demand for new and premium fragrances drives constant innovation in product launches. Wide distribution networks ensure availability across regions.
Weakness: Small and regional players face challenges competing against global established brands due to lower affordability for branding and marketing activities. Frequent changes in consumer preferences increase uncertainty.
Opportunity: Growing popularity of custom and niche fragrances presents an opportunity to target specific customer segments. The rising hygiene and self-care industry boosts demand for personal care products including fragrances. Expansion in untapped developing markets in Asia and Africa can boost sales volumes.
Threats: Stringent regulations on ingredients may restrict product development and increase compliance costs. Economic slowdowns can reduce discretionary spending on luxury items like fragrances. Shift to natural and eco-friendly products becomes a challenge for conventional chemical-based variants.
Key Takeaways
Global Fragrance And Perfume Market Trends are expected to witness high growth.
Regional analysis: Asia Pacific region is projected to expand at the fastest pace in the global fragrance and perfume market during the forecast period. Improving economic conditions, growing middle-class population, and increasing consumer expenditure on personal care products are driving the market in the region. China and Japan accounted for more than half of the Asia Pacific fragrance and perfume market revenue in 2021.
Key players operating in the fragrance and perfume market include MorphoSys US Inc., Bristol Myers Squibb, Karyopharm Therapeutics, F. Hoffmann-La Roche AG, Merck & Co., Inc., Gilead Sciences, Inc., and Novartis AG. Key players are focusing on product innovation and portfolio expansion strategies to consolidate their market presence.
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