Luxury Perfume Market

Luxury Perfume Market Outlook (2023-2033)

The global luxury perfume market is expected to increase from a valuation of US$ 14.9 billion in 2023 to US$ 24.3 billion by the end of 2033, expanding at a CAGR of 5.6% along the way. Sales of luxury perfumes accounted for 35.3% share of the global perfume market at the end of 2022.

Strong growth in the cosmetics & personal care market has been witnessed in recent years. The most urbanized people tend to incline towards new and innovative products and their spending characteristics reflect higher expenditure on green and innovative products. Exotic and well-known ingredients are used to outline a worldwide palette of raw materials for luxury fragrances to portray a wealthy, opulent personality. A perfume is deemed luxurious when the scent is potent.

Many luxury perfumes are made from natural ingredients and have deep and rich notes. Some of the notes are roses, jasmine, sandalwood, musk, oak, rosewood, and so on. To meet the requirements of eco-conscious consumers, luxury perfume brands are working to make sustainable fragrances. Also, the demand for luxurious fragrances from generation Z is increasing rapidly, attracting the attention of major players who are focusing on the customized packaging of high-end perfumes.

• Augmenting social media marketing and increasing demand for Western-feel products is expected to drive luxury perfume market expansion.
• Asia Pacific and North America are anticipated to witness high luxury perfume demand on the back of escalating middle-class population, coupled with rising disposable income.
• Inclination towards natural and organic products and growing population will drive luxury perfume demand in the long run.

Report Attributes	Details
Market Size (2022A)	US$ 14.1 Billion
Perfume Market, 2023 (Parent)	US$ 40 Billion
Estimated Market Value (2023E)	US$ 14.9 Billion
Forecasted Market Value (2033F)	US$ 24.3 Billion
Global Market Growth Rate (2023-2033)	5.6% CAGR
North America Market Share (2022)	~25.1%
East Asia Market Growth Rate (2023-2033)	~5.9% CAGR
United States Market Growth Rate (2023-2033)	~5.0% CAGR
Market Share of Top 5 Companies	~20.3%
Key Companies Profiled	LVMH Moet Hennessy Louis Vuitton S.E. Estee Laude Coty Inc. CHANEL International B.V Shiseido Company. Hermes International Giorgio Armani Beauty PUIG Capri Holdings Limited Others

Factors Influencing Market Growth

“Changing Attitude of Consumers towards Unisex Perfumes”

Since the behavior of consumers is changing towards perfumes, their preferences are being moulded accordingly. During 2020-2021, the fragrance market expanded by 10%. However, according to a study by Liberty London, sales of unisex perfumes increased by 40%. In the realm of fashion, there is an increasing desire for unisex fragrances. This style is being used by niche perfume producers to meet market demands. Thus, the rising need for unisex products is driving the global luxury perfume market.

“Consumers Demanding More Refined Ingredients in Luxury Perfumes”

The perfume business has observed a strong performance in the luxury segment as opposed to the mass segment in the last few years. Market players are concentrating on purchasing pricey natural raw materials to make their products since the focus is on exclusivity and originality to develop unique, engaging, and authentic products. The premium and luxury segment is attracting more consumers, which is causing the mass-produced perfume category to lose business.

Due to the growing knowledge of the advantages of natural ingredients, consumer preference for clean- and green-labelled personal care and cosmetic goods is changing substantially. Because chemical or synthetic products include hazardous chemicals, consumers are choosing greener alternatives more frequently.

This rising demand is pushing manufacturers to integrate natural compounds into their products and avoid the use of harmful or toxic chemicals.

“Rising Demand for Premium Perfumes in Asia Pacific”

With the growing population in the Asia Pacific region, the market here is expected to exhibit the highest growth. Furthermore, luxury perfume brands such as Chanel, Zara, Davidoff, and Tom Ford have entered the Asia Pacific region and are experiencing a great response from the consumer end.

The growing niche fragrance brands are also creating opportunities for entrepreneurship in the region. e-Commerce platforms have lowered the barrier for new competitors in the market as well.

“Rules & Regulations Affecting Market Growth Negatively”

Multiple international and national organizations have laid down rules and regulations regarding the usage of certain chemicals in the manufacturing of luxury perfumes. Some chemicals used in making luxury perfumes, if used in large quantities, can lead to harmful impacts such as irritation, rashes, and allergies.

Organizations and associations, namely, the International Fragrance Association and the International Flavors & Fragrances Inc. have laid down rules that limit the utilization of toxic chemicals in luxury perfumes to reduce the negative impact on the environment and eco-friendly users.

“Elite Customers Going in for Limited Edition Fragrances”

Luxury perfumes are more popular among high-profile society members. The average person cannot afford luxury perfumes, which will limit the growth of the market in the long term. In addition, brand owners do not give many offers or discounts, even during festive seasons, to drive attention towards such luxurious products. As a result, middle- and low-income group consumers do not go for such products due to their limited disposable income.

Market share analysis of luxury perfumes based on product type and region. Under the product type segment, Eau De Parfum dominated with 35.6% market share in 2022.

Country-wise Insights

Why are France and Italy So Well-Known for Luxury Perfumes?

France is the largest market when it comes to luxury perfumes, and many renowned perfume companies have roots in the country. France is a market leader with 30.5% share in 2022 and is anticipated to capture 36.6% share of the European market by 2033.

Many luxurious perfumes with big names are located in Paris, such as Louis Vuitton, Dior, Chanel, etc. The mention of “Paris” or “Made in France” has become a guarantee for the authenticity of the product. These luxury perfumes are further endorsed by celebrities.

Italians have been making perfumes for centuries, and pioneered formulas made their perfumes famous across the globe. “Aqua di Parma”, one of the most famous Italian luxury perfume brands, conserves the tradition of craftsmanship. “Blu Meditterraneo” perfumes depict the beauty and the views of the Italian Mediterranean Sea.

The market for luxury perfumes in France is expected to reach a valuation of US$ 3.0 billion by 2033.

What is the Luxury Perfume Market Scenario in the U.S.?

The U.S. is set to dominate the market in the long-run forecast period owing to higher product penetration, rising awareness, and the ability to inculcate expensive luxury perfumes into the market basket of consumers.

Growing health concerns among consumers and the less eco-friendly nature of chemical synthesis have resulted in increasing demand for luxury perfumes that are made from bio-based ingredients. Rising disposable income and growing fashion and film industries concentrate more on physical appearance where perfumes play an important role. Increasing saloons and beauty parlors due to the increase in working people will further propel the market in the U.S.

The North American luxury perfume market is currently estimated at US$ 3.5 billion and is expected to reach US$ 5.8 billion by 2033.

Category-wise Insights

Why is Eau de Perfume Gaining Popularity?

Rise in the popularity of Eau de Perfume among generation Z will bolster the overall market in the long term. The segment is expected to account for the highest market share of 35.6% by 2033.

Eau de Perfume contains high amounts of fragranced oils that define a scent, and the scent lasts for a longer period. This type of fragrance is perfect for all skin types, including sensitive skin, as it contains less alcohol concentration.

The Eau de Perfume segment is predicted to reach a valuation of US$ 4.7 billion by the end of 2022.

How Much Does the Offline Segment Dominate the Market?

The offline segment dominated the market in 2022 with around 66.6% market share and is expected to lead the market during the forecast period as well.

Most customers want to test the product before they take them back home. Perfume purchasing is a joyous experience and trying out new fragrances by visiting a store, smelling them, and enjoying them, is unbeatable.

Offline sales of luxury perfumes are likely to grow at a CAGR of 4.1% to reach US$ 1.13 billion by 2033-end, while online sales of luxury perfumes will increase at a CAGR of 4.9% to reach US$ 642.4 million.

Competitive Landscape

Prominent luxury perfume manufacturers are LVMH Moët Hennessy Louis Vuitton S.E., Estee Lauder, Coty Inc., CHANEL International B.V., Shiseido Company, Hermes International, Giorgio Armani Beauty, and Capri Holdings Limited, PUIG.

Manufacturers are focusing on natural ingredient-based products. Expansion of manufacturing capacity and increasing sales by leveraging online distribution channels are expected to propel the market growth rate. Manufacturers have made long-term supply contracts with end users to ensure consistent product demand.

Companies manufacturing luxury perfumes are involved in two different strategies - single and multi-level marketing and traditional marketing. Moreover, market players are adjusting production variables such as raw material input and energy, coupled with process optimization, to win in this market.

• In 2022, Louis Vuitton launched a luxury perfume for men and women named City of Stars. The company claims it to be free of harmful chemicals.

Fact.MR has provided detailed information about the price points of key manufacturers of luxury perfumes positioned across regions, sales growth, production capacity, and speculative technological expansion, in the recently published report.

Segmentation of Luxury Perfume Industry Research

• By Product Type :

  • Eau de Parfum
  • Eau de Toilette
  • Eau de Cologne
  • Eau Fraiche

• By Consumer Orientation :

  • Men
  • Female
  • Unisex

• By Sales Channel :

  • Offline
    • Hypermarkets / Supermarkets
    • Duty-Free Stores
    • Specialty Stores
    • Multi-brand Stores
    • Standalone Stores
  • Online
    • E-commerce Websites
    • Company / Brand Websites

• By Region :

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Oceania
  • MEA