Opinion | Millennials drive the fragrance category
Personal grooming has taken off and is more of a need than luxury for millennials
Last week, Virat Kohli announced the launch of perfumes under his brand One8. The fragrances, including Eau De Parfum, deodorants and pocket sprays, have been crafted by French perfumers and promise luxury at affordable price. In October, footwear major Liberty Shoes Ltd also announced its foray into the perfumes category. Liberty Lifestyle’s chief executive officer Adesh Gupta says its perfumes are crafted in France and imported and bottled in India. A few months ago Global Fragrances got actor Soha Ali Khan to launch its Double Cross perfumes in the market. Among established brands, fast moving consumer goods company ITC Ltd recently launched a new variant under its Essenza range. “We will keep innovating and launching new variants and creating new occasions of consumption,” says its CEO (personal care) Sameer Satpathy. “Perfumes is a highly fragmented category. Right now top 10 players have 65%-70% of the total market,” he adds.
The rush to enter the fragrances category in India is driven by the potential of the market with a special focus on the millennial consumer. According to a report by research agency Euromonitor, the compound annual growth rate for fragrances between 2017 and 2022 for deodorants is 9.3% while for fragrances it is 11.8%. Euromonitor’s senior research analyst Anul Sareen says the companies are rushing into the category to tap the large young consumer base in the country. “And since fragrances is still an underpenetrated category, there’s a lot of room to grow,” he says.
Ashwini Sirsikar, head of qualitative research at Ipsos agrees that deodorants are well penetrated so marketers have turned to perfumes. “Perfumes is only 25% of the deos category size,” she says. Bhasker Canagaradjou, head of Ipsos Business Consulting India, pegs the market for deodorants and perfumes at around 5,500 crore. “The market witnessed strong annual growth rate of 25-30% in the last 5-7 years mainly due to the deodorant segment. Mass priced products accounted for 95% of the market,” he says. Yet others estimate the organized Indian fragrance market at over Rs 2,000 crore and expect it to touch Rs 3,000 crore by 2021.
To be sure, India has a deep connection with aromas and fragrances. “We have homegrown ingredients and natural oils. With growing disposable incomes and greater exposure to foreign lifestyle trends, Indians are investing in good grooming and the market for perfumes and other fragrances has boomed as a result. This trend is visible across town classes,” says Canagaradjou. Besides, millennials increasingly focus on looking good. They are much more open to new experiences, new products and also socialize much more. “Pubbing, going to cafes, partying is a strong part of the youth culture. The social interaction between genders has also increased and the need to create a good impression is becoming universal. It is not enough to dress well, but also to smell good,” says Sirsikar. “India is becoming a more expressive society and openly embracing a consumption culture,” she adds. Agrees ITC’s Satpathy: “Fragrances are becoming a part of who you are. It is becoming a part of everyday habit.”
Little surprise then Jinesh Mehta, chairman, Scentials Beautycare & Wellness Pvt Ltd, the company which has collaborated with Virat Kohli to launch One8, has also positioned the brand in the “affordable luxury” segment. “The brand targets men in the age group of 16-35, with the deos range fulfilling the needs of the millennial youth and perfumes catering to consumers with more spending power,” The company plans to launch new lines and limited edition products in the coming months.
Although Indians are more inclined towards foreign perfume brands, the landscape is changing and companies here are launching products in the price range from affordable to luxury segment combining foreign and local ingredients. “Companies like Bombay Perfumery and Perfume Library are homegrown brands in the premium segment. Given that perfumes are expensive, mass brands and smaller pack size units have made them attractive in smaller towns,” says Canagaradjou. Satpathy agrees that small towns are also warming up to perfumes. “It is trending across. People are not limited by geography any more. If you have money you can access it online,” he says.
Liberty’s Gupta says that the company zeroed in on the perfumes category after extensive research as the fragrance segment currently occupies 5 per cent share in the total lifestyle market in India, “giving a huge window for growth.” Personal grooming has taken off and is more of a need than luxury for millennials. “The aim was always very clear, we would be targeting Gen Z and the millennials and what better way than to enter into the fragrance industry.”
Shuchi Bansal is Mint’s media, marketing and advertising editor. Ordinary Post will look at pressing issues related to all three. Or just fun stuff.
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