More than 100 new fragrances launched in 2015, with the requisite marketing budgets to back them up. Yet as companies shelled out some 20 percent of their revenues to promote their latest scents, it wasn't enough to move the needle on the industry's best-sellers.
Four of the top 5 sellers in the higher-end "prestige" women's fragrance market last year were created more than a decade earlier, including the then 94-year-old Chanel No. 5, according to a new report by A.T. Kearney.
related investing news
The only fragrance that was new to the top-sellers list in 2015 was Marc Jacobs' Daisy, which was brought to market in 2007. Rounding out the top five were Coco Mademoiselle and Chance Eau Tendre, both by Chanel, and Dolce & Gabbana's Light Blue. None of those scents was released after 2003.
The top five men's fragrances have seen a little more movement, but have overall remained relatively steadfast. Armani Code and D&G Light Blue each rejoined the top-sellers list after a brief respite, while the three most popular fragrances — Acqua di Gio, Polo Red and Bleu de Chanel — retained their stake. Polo Red is the newest of these scents, having launched in 2013.
"Fragrance manufacturers are stuck in an expensive marketing cycle that rarely turns brands into new best-sellers," said A.T. Kearney partner Hana Ben-Shabat, who co-authored the report. The firm's research analyzed sales data from The NPD Group.
One explanation for the grip these fragrances have on consumers is that one-third of people who buy perfumes and colognes are loyal to an existing brand. Among the survey's 844 respondents, 34 percent said the purpose of their latest fragrance purchase was to replenish an empty bottle.
Yet for those who are open to trying out new scents, many of the tactics beauty firms are using simply aren't resonating with shoppers. Advertisements placed near the register tied for last place with those ubiquitous sales people who spritz you with samples as the least effective marketing tool, according to A.T. Kearney's study.
Although there has been little room for new fragrances to break into the top-sellers list, A.T. Kearney noted that smaller niche scents have helped drive sales for the overall industry. After several years of contraction, the fragrance category's revenue rose in both 2014 and 2015, growing 4 percent to more than $4 billion last year.