Global perfume market to reach US$70 billion; personal care and beauty appliances to hit value of US$30 billion; IFF-Lucas Meyer buys Swedish green beauty tech leader; and Marionnaud shutters all stores in Spain and Portugal.
Global perfume market to reach US$70 billion
The end of the year is a goldmine for fragrance sales. Not only in the final two weeks before Christmas, but also because of the mega shopping events – Black Friday, Cyber Monday and Singles' Day. In 2018, 41 per cent of Australians bought something online over Cyber Weekend, the four day long weekend between Black Friday and Cyber Monday. Global fragrance sales in travel retail are also sky-rocketing, with perfume sales up 63 per cent in the Americas, 67 per cent in Europe, the Middle East and Africa (EMEA) and 10 per cent in Asia/Pacific in 2018, reports Generation Research.
A new report from Future Market Insights confirms the upsurge in revenues and predicts that the global perfume market will reach US$70 billion by 2024. The key drivers, says the researcher, are younger generations in the Asia/Pacific region, including Japan, fueling sales online, in-store and in travel retail. Limited editions from the major designer brands are also driving robust sales. Targeted launches, such as Chanel's body lotions, body sprays and shower gels in major franchises such as No 5 L'Eau and Gabrielle, are also boosting consumer awareness in the fragrance category in emerging markets by emphasising the link with daily personal care.
Personal care and beauty appliances to hit value of US$30 billion
The personal care and beauty appliances category casts a wide net from men's beard trimmers to electric toothbrushes, hair straighteners, skin rejuvenators and sonic cleansers. Global revenues reached US$20 billion last year, reveals Global Market Insights, and are expected to increase to US$30 billion by 2025.
Body and hair care products are on a roll, says the US-based data tracker, especially among Millennials. More sophisticated options at all price points are also driving sales across all age groups. Oral care is enjoying galloping growth in developing and developed markets. In leading European markets, such as Germany and the UK, for example, dentists and health associations are routinely recommending electric toothbrushes for better cleaning similar to their US and Australian counterparts.
The Asia/Pacific personal care and beauty appliances market was valued at US$7 billion in 2018 and is rapidly increasing because local manufacturers are offering lower-priced shavers, hairdryers, cleansing brushes and more compared to the global players, many of which are battery-operated.
But the big names still dominate the category, says Global Market Insights, led by Procter & Gamble, Panasonic, Philips, Dyson, Conair and Spectrum Brands. The multinationals continue to invest strongly in R&D to create more advanced products and stay ahead of the me-too pack.
IFF-Lucas Meyer buys Swedish green beauty tech leader
US fragrance heavyweight, International Flavors & Fragrances (IFF), continued the consolidation of the global industry late last year with its US$7.1 billion acquisition of Frutarom, the Israeli specialist in natural products and extracts focused on health and wellness. The buyout resulted in the domination of the flavors and fragrances sector by two multinationals – Swiss-based Givaudan and IFF.
Four years ago, IFF bought Canadian manufacturer, Lucas Meyer Cosmetics, with operations in France and Australia, for AUD$460.33 million. The strategy was a further move into the health, wellness and natural categories in the beauty and personal care industries. Following the completion of the deal, the spin-off became the IFF-Lucas Meyer affiliate.
In another naturally-oriented expansion, IFF-Lucas Meyer has acquired Swedish green tech company, Speximo AB, for an undisclosed sum. Developed from quinoa grains, its patented technology focuses on developing natural and sustainable creams, powders and sprays. According to Nicolas Mirzayantz, IFF Scent Division CEO: "It's critical that in our quest for innovation, we find products and technologies that align with and support our purpose – to redefine and transform how we live in and care for the resources of the world".
Marionnaud shutters all stores in Spain and Portugal
A.S. Watson bought Marionnaud in 2005 for 534 million euros (AUD$869.7 million) in cash. The world's largest beauty and health retailer, which also owns Superdrug in the UK, was looking to expand in France and other major European markets, including Spain, Italy and Austria. As the largest perfumery and cosmetic retailer in France with more than 1100 stores in 11 markets, Marionnaud was a great strategic buy.
In 2014, Hong Kong-based A.S Watson undertook a major restructure of Marionnaud, pulling out of Poland and drastically reducing the number of stores in Spain and Portugal by 60 per cent – closing 73 stores out of 128. The company has announced it will be shuttering its remaining 40-plus stores in the two Iberian countries by January 2020 to concentrate on more profitable markets.
Snippets from the Wires
- The growth of smart speakers in Australia is spiking upwards. According to Nielsen, 2.9 million Aussies (14% of the population) now own one. The market leader is Google Home (79%), followed by Amazon Echo (7%) and Apple iPod (3%).
- More mass retailers worldwide are launching own brand wellness and beauty supplements. Walmart, the world's biggest retailer, is launching the Glow Habit private label range. Prices begin at US$9 for a month's supply of Good Skin Habit, Sleep Well Habit, Healthy Hair Habit and Probiotic Vegan Habit.
- Following the acquisitions of The Body Shop, Aesop and Avon Products, Brazil's Natura & Co became the world's fourth largest beauty company. The multinational is expanding into Asia, starting with Malaysia as a regional launchpad. Further expansion is planned for Singapore, Japan and South Korea.
- The appeal of his and hers fragrances is cyclical. Queen Victoria and Prince Albert kicked off the trend in the English-speaking world in the mid-19th century. There's been an uptick in the launch of twosomes with new releases such as Jean Paul Gaultier's Le Beau and La Belle. Coty will be launching Tiffany & Love for Him and Tiffany & Love for Her in the run-up to Christmas.
