Blooming aerosols, fragrances market in India

Blooming aerosols, fragrances market in India

5:27 AM, 6th September 2018
Organic Chemicals – Fragrances

A report by Euromonitor International released in May last year suggested that the market for deodorants in India grew by an enormous 177 percent between 2011 and 2016. In 2011, deodorant sales stood at Rs 1,130 crore; by 2016 it had almost tripled to Rs 3,130 crore. The annual growth rate of the industry is pegged at 18 percent and this rate is expected to continue for another four to five years according to experts.

This isn’t surprising, given India’s long-standing fascination with products that please the olfactory senses. Since ancient times, the mastery of the science of perfumery was an essential part of the art of living in India. The indigenous Indian tradition of scent in India is evident as early as 3000 BC in the cities of the Indus Valley, where archaeologists have recently excavated distillation stills. In the centuries that followed, the elaborate use of aromatics was a major feature of religious, royal and erotic practices. The skilled use of perfumes was believed to delight the gods, appease the kings, and exciting lovers.

Today, India is one of the fastest growing markets globally for deodorant sprays. India’s per capita consumption of deodorant sprays has increased from 12.5 ml in 2012 to 20.3 ml in 2016. This is still just over a third of the global average consumption rate, which suggests there is still plenty of scope for further penetration and product development, according to market research company Euromonitor.

Increased social interactions

The high growth rate is due to the low market penetration of products, which are currently used by only 10 percent of the population. In fact, almost 85 percent of all deodorant sales take place in the big cities alone. With consumers constantly exposed to conditions such as dust, pollution and scorching and humid weather, they do not want to smell and stink. The demand for deodorants is mainly being driven by the changing consumption patterns of the young and affluent middle class for whom personal grooming is important with a penchant for smelling good and fresh always.

To deal with the resulting sweat problems, there is already a big market for talcum powder in Rs 1700 crores. But the market is now upgrading to deodorants because these do not destroy bacteria and the smell remains. Aerosol sprays have emerged as the most popular deodorant format, due to their ease of application, immediate dryness and durability. Another reason why sprays are so popular in India is because they can be shared by a family while roll-ons are for a single user. As a result, sales of larger-sized aerosol cans are popular.

Rising income levels and increasing awareness about hygiene and personal grooming, especially among the younger demographic, have provided favourable conditions for the rapid expansion of India’s deodorant market. Surprisingly, instead of women, until now men have remained the core target market with nearly two-thirds of the products catering to them. Young men are more likely now than ever to live alone since they delay marriage. As a result, they have higher levels o disposable income to spend on their upkeep and wellbeing. In fact, rising demand for perfumes from working professionals, in particular, is boosting the perfume industry as they want to smell good from the moment they enter into the workplace till they exit.

Emerging players in the deodorant market

The increasing popularity of online shopping among the target group of consumers could well lead to changes in the way companies handle their distribution across the country. A wide network may not be needed by new companies looking to enter the market as the online business grows. It could also help them overcome constraints relating to displays at retail stores and availability in remote regions.

However, brands have also realized that the options for women’s deodorants are limited and are working on capitalizing on this opportunity. The untapped segment is likely to see a surge with both existing brands and new entrants switching targets via media campaigns to cash in on the segment’s enormous growth potential.

One new trend within the spray formats is a shift from aerosols to non-aerosol based deodorants. Almost all brands in the category have launched new product ranges and extensions in this format. The pioneer in this segment has been Vini Cosmetics Ltd’s Fogg brand, which ran a very successful television advertising campaign highlighting the non-use of gas in its cans. They highlighted that their bottle would last longer than a bottle that uses gas.

Tough competition by domestic brands

Launched in 2011, Vini Cosmetics was entering a very crowded deodorant market. The major deodorant brands in India include HUL’s Axe, ITC’s Engage, CavinKare’s Spinz, P&G’s Old Spice and Raymond Group’s Park Avenue. Up against these, Vini Cosmetics knew they had to innovate and hence the non-aerosol based format. Their flagship brand Fogg is now available in several dozen variants and according sells two almost million cans every month. At present, non-aerosol products already account for about 20 percent of the deodorant market share and according to Vini Cosmetics, in another five to seven years, they will gain half of the market share.

Indian consumers are fast maturing into quality seekers who need the best in whatever they consume. Yet, the body spray is well aware their products are also largely used as cheap perfumes as consumers apply them while fully clothed too. One of the reasons for this is that perfumes are expensive, often costing much more than their deodorant counterparts. Indian consumers certainly look for strong, long-lasting fragrances in a deodorant, which is partly driven by India’s tropical climate.

The durability of a fragrance becomes a vital role for deodorant manufacturers.

With increased focus on male customers, deodorant companies are looking for attractive male fragrances, which tend to be more citrusy, woody, amber-orientated, ozonic, watery and fresh, while female fragrances are more floral and sweet. Yet specialized fragrances in deodorants may be a passing phase. As income levels rise even further, the Indian market may move away from deodorants towards real fragrances.

There is already luxury sub-segment where people are ready to pay more for high-end deodorants.

Usage of different fragrances for different occasions

However, the number of discerning consumers in India remains limited. Although segregation has been felt in consumers’ needs, they are still largely uneducated with regards to what is suitable as a day fragrance or what might work well for them after dusk. Brands can still play a big role in educating consumers and offering them fragrances meant for different occasions. For eg, experts would suggest opting for subtle scents with crisp fruit or light floral notes for work, particularly if one works in close quarters. Or choosing a perfume as striking as your attire for important neck-tie events, such as a combination of musk and wood top notes with citrus undertones for a sophisticated complement to an elegant evening.

The products that are based on finer fragrances and can combine skin care benefits with fragrance will be sought after as consumer preferences will shift towards multipurpose products for convenience.

Source: Ava Chemicals Pvt Ltd.

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