MENA regions hold ‘promising potential’ in fragrance

Published: 23-Oct-2014

The Middle East and North Africa region highlighted as area of promising potential in the fragrance sector

The Middle East and North Africa (MENA) region has been highlighted as an area of promising potential in the fragrance sector.

According to Euromonitor International, fragrance sales in MENA amounted to US$2.9bn in 2013, while over 2013-2018 fragrance is expected to increase by US$1.3bn, thus raising the region’s proportion of the global market from 6% in 2013 to 9% in 2018.

The top contributors in 2013 were Saudi Arabia, UAE, Israel and Iran, accounting for 78% of MENA sales rising to 80% in 2018. The fragrance per capita spend is projected to reach US$8.8 in 2018, higher than the global average of US$6.8. Saudi Arabia and the UAE saw CAGRs of 13% and 7% respectively, according to Euromonitor.

This growth resulted, at least in part, from a favourable economic climate with rapid investment in infrastructure, including upmarket malls that provide the distribution channels for the fragrances category to operate.

Nicholas Micallef, Beauty and Personal Care Analyst at Euromonitor, said: “The MENA region, Saudi Arabia in particular, can expect further growth from consumer shifts following a fatwa released in 2012 that states Muslims can now use alcohol-based fragrances in addition to those oil-based, as the alcohol levels are generally low. The challenge is that such market prospects hide behind the geopolitical and economic uncertainties afflicting parts of the region. The premium segment is also hampered by the black market and counterfeiting, often sold at a fraction of the price of a genuine premium brand. Morocco, as well as markets like Egypt and Algeria, despite their substantial consumer base, are laggards. While demand and aspiration are there, distribution and affordability remain obstacles.”

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