Fragrance sales may be suffering in the throes of the global recession but a heightened focus on creativity and legitimacy is helping keep the sector afloat, as Emma Reinhold reports
Embarking on a new creative direction may not be the traditional reaction to an economic crisis but for the fragrance sector, brands are hoping that pulling out all the creative stops will reap much needed rewards. After 12 months of heavy discounting, destocking and general retail despair, the industry has taken a good hard look at itself and change is in the air.
“The industry is beginning to realise just how easy it has had it for so long,” explains professeur de parfums Roja Dove. “Fragrance and the way it is retailed has become such a depressing experience in too many cases.”
The last year has seen more than 400 fragrance launches compete for shelf space and as economic uncertainty forces many consumers to re-evaluate their spending patterns, something has had to give, with the middle market becoming the first casualty.
“The middle market is really haemorrhaging at the moment,” continues Dove. “Fragrance is becoming much more polarised and consumers are being much more considered in their purchases. They are definitely buying less scent but interestingly they are prepared to pay for it if the perfume is right for them.”
“In this time of recession the top price brands have not been affected but it is the middle market that is under pressure right now,” adds John Ayres, director of fragrance consulting business Pandora. “The word destocking is being used a lot right now which is worrying.”
Hopes of a rallying in sales for middle market fragrances were further compounded by a disappointing Christmas period. Discounting continued well into the new year with many stores offering up to 70% off the original price in a bid to generate sales.
“It’s very damaging but there has to be an option to clear stock,” says Jill Hill, md Aspects Beauty Company. “We have started discounting and for whatever reason the genie won’t go back into the bottle. You have to find a way of living with that, whether it’s reducing the amount of stock available on the market or not allowing stores to buy too heavily. One thing is clear, we need to manage it better.”
Yet despite the economic downturn, the fragrance market still achieved a respectable global value growth of 6% over 2007-2008, according to Euromonitor International, a figure the analyst points out was 1% higher than the growth for the global C&T market as a whole.
“Because the recession mentality took until at least mid-2008 to begin to register with many consumers, sales up to that point were largely in line with those of the previous year,” explains Carrie Lennard, industry analyst, cosmetics & toiletries, Euromonitor.
However the analyst predicts both male and female fragrances will stagnate over the next five years as consumers make cutbacks due to the recession either through less frequent purchases or streamlining their fragrance wardrobes.
QUALITY CONTROL
In the meantime Euromonitor says there are still many consumers who are happy to spend upwards of $100 on a bottle of perfume. Sales of premium scents ammounted to $10bn in western Europe in 2008, compared to just $3.6bn for mass fragrances, it says.
“Price increases have been commonplace in an effort to break free from more ubiquitous fragrances,” says Hill. “Labels like Tom Ford, Guerlain, Chanel and Armani Privé have spearheaded this with exclusive fragrances but it is becoming more widespread. Versace’s new Couture fragrance retails at £300 for instance.”
Quality has played an important role in the justification of these high prices and brands have promoted the quality or rarity of the ingredients used as a way to create interest around their fragrances.
“There has been a significant change in quality of the raw materials used,” says Ayres. “Fragrance houses are now demanding higher quality.”
“There is certainly a return to quality,” continues Hill. “It’s great that upmarket names are looking for quality to re-establish their credentials.”
One area that is flourishing as a result of this greater focus on the quality of raw materials is the natural and organic fragrance sector, which although remaining a niche area, has seen some heightened activity.
Niche brand Memo, created by Paris-based designer Clara Molloy has created two new scents for its Voyages Naturels collection. Grapefruit from Argentina and orange blossom from Italy are said to be composed from organic ingredients.
And L’Artisan Parfumeur has released its second natural scent. Côte d’Amour has Ecocert and Cosmébio cetification and was created by perfumer Céline Ellena.
Liz Earle meanwhile has worked with Laboratoire Monique Remy (IFF) in Grasse to create her first fragrance, Botanical Essence Eau de Parfum No.1. The institute, renowned for its quality and approach to sourcing botanical ingredients with integrity, provided the ingredients for Earle’s sparkling floral which is said to contain over 98% natural ingredients including lavender, bergamot, damask rose and patchouli.
Quality has also traditionally been associated with the perfume industry’s great classics, which are enjoying renewed interest from consumers.
“In a world of uncertainty, the reference to the past is reassuring and the classics are safe value,” explains Catherine Bru, director FDG Fine Fragrance and Beauty Care, IFF.
“The classics provide that nostalgia kick, which people are looking for at the moment,” adds Hill.
One interesting theme that has evolved out of this renaissance for classic scents is the trend for adding a modern twist to a classic scent. Chanel started the trend last year with the launch of Eau Première, its modern take on the classic No 5, but there have also been new creations from Estée Lauder’s Private Collection in the form of Jasmine White Moss, YSL Beauté’s Parisienne, an homage to its classic scent Paris, as well as Chanel’s modern tribute to Cristal, Cristal Eau Vert.
Other fragrance brands have looked to their archives and relaunched old classics. Aramis for instance has relaunched six of its classic scents including Tuscany Per Uomo, New West, Devin, Aramis 900 and Aramis Life.
Cacharel has also searched its olfactive archives for the launch of its new feminine scent Scarlett. The brand has looked back at its roots and the success of Anäis Anäis for inspiration and Scarlett is described as a revisit of the floral white bouquet, blending notes of jasmine, orange blossom and honeysuckle.
Similarly Nina Ricci has used its fashion and scent heritage for Ricci Ricci, its new fresh floral feminine scent. The fragrance gives a deliberate nod to past classics such as L’Air Du Temps and Fille D’Eve but with a contemporary twist, in this instance the inclusion of belle de nuit as an ingredient, the first time it has been used in perfumery.
Alongside classic scents there has also been increased interest in classic perfumery houses, with some houses that have lain dormant for years hitting the olfactive headlines once again.
“There has certainly been a revival of obsure old French perfumery houses in the last few years with names like Houbigant and Loubin appearing once more, and old couture houses such as Balenciaga and Balmain becoming fashionable again,” says Dove.
Coty’s acquisition of the Balenciaga license is one to watch, according to Dove, who says the beauty giant plans to let go of Balenciaga’s entire perfume back catalogue including the iconic Le Dix fragrance.
MAKING MULTIPLE SCENTS
Another area that is steadily gaining momentum in the fragrance market is the launch of mulitple scents. Previously confined to the niche sector, the number of fragrance ‘editions’ and ‘collections’ has swelled considerably in the last few months.
“The trend to launch a block of scents and the multi scent launch certainly seems to be establishing itself,” says Dove. “Simultaneously launching scents is about economies of scale. It’s more cost effective than having five separate fragrance launches. In addition the counter space that is occupied will be much larger and it makes people really stop and look.”
A multi launch also offers brands the opportunity to shore up its brand credentials. At the premium end La Prairie has launched Life Threads, a trio of fragrances named after the brand’s three skin care ranges – Gold, Platinum and Silver. Each bottle is wrapped in strands of gold, silver or platinum to reinforce the theme.
Similarly, Van Cleef & Arpels has drawn inspiration from its Les Jardins jewellery collection for the launch of its new Extraordinary Collection, composed of six fragrances housed in identical bottles. The collection includes Gardénia Petale, Orchidée Vanille, Bois d’Iris and Cologne Noir.
“The Les Jardins jewellery collection was based on four different themes so it seemed logical to create a whole collection, featuring several aspects of nature rather than a single fragrance,” explains Eric Doucet, export manager, Inter Parfums. “The haute perfumery market is mainly composed of collections so it was important for us to have a legitimacy in this area.”
Tom Ford, Guerlain and L’Artisan Parfumeur have also launched premium collections. Ford’s Private Blend comprises 12 unisex fragrances, again packaged in a single bottle design, each based on a single note, while Guerlain has created One Love, a trio of scents inspired by the cities of Paris, New York and Russia. L’Artisan Parfumeur’s Mon Numéro collection meanwhile comprises seven one-off fragrances, which will be replaced by new creations when they are sold.
The concept has also found favour in the mainstream. D&G has launched the five-strong Fragrance Anthology designed, says the brand, to allow the ultimate in fragrance self-expression. Inspired by the game of Tarot, the fragrances represent different personalities including sensual L’Amoreux and provocative Le Baleteur.
And Benefit’s new fragrant trio, Crescent Row, features the whimsically named My Place or Yours Gina, Something about Sofia and Laugh with me Lee Lee fragrances.
CELEBRITY ENDURES
Despite a general consumer move towards more premium perfumery, the pressured mass market is still showing signs of activity. Euromonitor says the masstige segment in particular has shown growth, being the fastest developing fragrance segment in western Europe. Key to this development has been the influx of celebrity scents.
“Despite their rather tacky image they [celebrity scents] are nonetheless crucial for the mid-term survival of the fragrance industry because they are typically lower priced than premium fragrances and appeal heavily to generation Y and younger teen consumers, a group already playing an important role in keeping the FMCG market afloat during the recession,” says Lennard. “Widespread concerns about job losses and house repossessions do not apply to this age group and this is exactly why the celebrity fragrance trend is likely to continue to play an important role over the next few years.”
The latest big name celebrity to succumb to the temptations of the celebrity fragrance business is Beyoncé Knowles, who has signed a licensing deal with Coty, following stints as the face of Tommy Hilfiger and Giorgio Armani fragrances. The first fragrance is slated to launch early next year and the deal could be worth up to $20m for the singer over the next three years.
“Manufacturers are desperately trying to find a new angle for celebrity fragrances, to extend the message and I think we will see other interesting twists to make a fragrance more appealing rather than just a scent and a bottle,” says Hill.
Britney Spears’ lastest fragrant addition is one such example. Circus fantasty comes after Spears’ number one single, album and global tour of the same name and takes the concept of celebrity fragrance in a new direction.
Similarly UK chef Jamie Oliver is to launch his first fragrance, initially sold through Oliver’s party plan operation, Jamie at Home, which includes home and cookware. The Scent & Savour collection will include two female scents and a two unisex edps inspired by the chef’s favourite herbs and spices.
There is also a very small but growing market for niche celebrity fragrances. Avante garde brand Etat Libre d’Orange has launched two celebrity scents for more unusual celebrities. Spanish actress Rossy de Palma and erotic artist Tom of Finland have both been given the Etat treatment with fragrances launched in the last 12 months.
And model and socialite Daphne Guinness has launched her first signature scent in collaboration with Japanese fashion brand Comme des Garcons. The niche fragrance will have a very limited distribution and combines bitter orange, rose, incense, jasmine, oud, amber and vanilla.
However Jason Zemmel, founder of online discount store halfpriceperfumes.co.uk believes interest in celebrity fragrances is beginning to wane for many UK consumers, who are instead turning to more classic scents.
“Whilst some like Britney Spears’ range still sells well, we’ve found many have shunned the scents of lesser known celebs,” says Zemmel. “We are now seeing resurgence for classics scents such as Christian Dior, Elizabeth Arden and Chanel, that have been around for years.”
The news comes as fragrance manufacturer Parlux, which holds licenses for several celebrity scents including Paris Hilton and Jessica Simpson, announced losses of $4.3m in 2008 and a $2.5m loss for the second quarter of this year.
ARTISTIC LICENSE
Creativity has also extended its influence to perfumery creation, with a number of brands taking greater olfactive risks in the creation of their scents than 12 months ago.
“Perfumers have a little bit more say than the marketers so we are seeing some more creative scents,” Dove tells SPC.
In the creation of Lalique’s latest feminine scent Encre Noire pour Elle for example, the brand is said to have given the perfumer a carte blanche in terms of creativity. The result is a floral, musky woody scent structured around the vetiver note, but brightened with bergamot, fuchsia, rose and cedar.
“Warm notes and rich, skin fragrances that combine amber balms and precious woods are a strong trend,” says Bru. “Halle Berry’s new scent combines amber and sexy musk, while John Richmond features amber and sandalwood, Wanted by Helena Rubinstein plays around iris and soft woods, and Valentino’s Rock ‘n Dreams blends almond and amber.”
Prada has again used amber to create a new addition to the Prada Classic range, L’Eau Ambrée. The scent combines fresh floral notes of citron and may rose with amber to create a delicate, lighter, more feminine interpretation of the classic scent.
“Playing around one ingredient is still a must for limited or private collections,” continues Bru.
New launches using the single note concept include Geranium by Frédéric Malle, Guerlain’s Aqua Allegoria Tiare Mimosa, Eau de Gentiane by Hermès, Infusion de Fleur d’Oranger by Prada and Acqua di Parma’s Magnolia Nobile.
“Many fragrances work as allegories to a particular fragrance material and interestingly this is encouraging a new clientele to experience these scents” adds Dove. “ Although these scents do not have the complexity of older perfumes their approach is classical and there is a legitimacy to it. It exploits a whole area of perfumery that hasn’t been seen for a while and encourages experimentation, which can only be a good thing.”
The use of musk has come through as a particularly popular raw material. Designer Narciso Rodriguez has used musk as the cornerstone for all his fragrances, and his latest feminine scent Essence is no different. Described as a powdery musky scent, the fragrance features notes of iris, rose petal, benzoin balm and modern accords of musks. Rodriguez has also created two limited edition fragrances where the musk accord has been heightened. For her musc and For him musc play with the original olfactive composition of Rodriguez’ debut fragrances for him and for her to create a more intense musky scent.
The ingredient has also played a key role for Serge Lutens, who has relaunched his Muscs Koublaï Khän fragrance. The scent blends cumin and patchouli with musk to create a heavy, animalesque aroma, in stark contrast to the light purity of his Clair de musc fragrance, which has also been repromoted with a limited edition bottle.
“Musk is a material that gives the human touch, the more sensual, more animal, from something soft to something powerful,” explains Lutens.
“Fruity notes have become less sickly and much sharper,” adds Ayres. He cites the cranberry in Givenchy’s Ange ou Demon le Secret and the rhubarb in Nina Ricci’s Ricci Ricci as examples. And star anise, traditionally used in cooking, has been used in Jo Malone’s Vanilla & Anise cologne, Bulgari’s new BLV Eau de Parfum II and Calvin Klein’s new men’s blockbuster, ck free.
“On the men’s side, powerful notes with strong character and intense fragrances are finding an audience,” explains Bru.
Diesel’s Only The Brave for instance, combines labdanum, leather and amber, while absinthe and chilli pepper have been incorpated into Davidoff’s Hot Water.
There is no doubt that the next year will be a tough one for the fragrance industry but with a greater focus on creativity, it may have just cushioned the blow.