As the INSEE (the French National Institute of Statistics and Economic Studies) has found household expenditure decreased in 2014 for the second year in a row (-0.2% in 2014 after a -0.3% decline in 2013), it seems the perfumes and cosmetics sold through selective distribution channels [1] did not benefit from the recovery in the consumption of manufactured goods (+0.7% in 2014 after -0.6% in 2013). According to the NPD Group research firm, selective perfumes and cosmetics sales reached 2.9 billion euros in France in 2014, which corresponds to a -0.6% fall in value.

 

Perfumes and multifunctional makeup are doing well

 

Despite a disappointing month of December compared to 2013 (-0.6% in volume), perfumery is the only sector whose turnover has increased (+0.2% in 2014), and there was no important launch this year to support this growth.

 

If prestige makeup sales show a -0.1% global decline compared to 2013, the situation in this category is far from homogeneous. Indeed, there is a strong increase in multifunctional makeup products sales (+128.4%), which cover makeup palettes comprising eye shadows, blush and sometimes even gloss, or lipsticks which also feature a blush function. Likewise, complexion products are quite popular among French women (+2.1% in 2014), contrary to boxes (-14.7%) and eye makeup (-4.6%).

 

Selective makeup is enhanced by constant innovation and should thus grow again in 2015, if companies manage to attract young consumers, who see it as a major seduction tool. According to a survey carried out by beauty and wellness treatment booking specialist Balinea.com, almost half of women (47%) consider makeup as their main seduction tool on a date. And this idea is mostly shared by younger ones (57% of women aged 20-30, 55% of those aged 30-40).

 

On the other hand, after keeping a high level for several years, skincare proved less trendy in 2014 (-3.8%). The cosmetics the most concerned by this decline are moisturizers (-7.2%), treatments designed for the eyes (-6.6%), and anti-aging skincare (-3.1%).

 

Traditional perfumeries are experiencing difficulties

 

According to the FFPS, once again, downtown and local perfumeries are those that suffered the most this year with a -5% sales decline in 2014, following the -9.8% collapse in 2013. However, their market share remains quite significant (14.5%).

 

As for the chains that entered a new era in terms of concentration, with Douglas buying Nocibé, they still represent 76.6% of the market. According to the FFPS, they managed to curb the decrease of their turnovers in stores (-0.1%).

 

All in all, it is actually the department stores (8.7% of the market) that show the best performance (+2.6%). By offering an ultra-luxurious customer experience, in Paris in particular, they seem to have managed to meet the expectations of well-off customers or of those that are willing to pay the price for an exceptional buying experience.

 

What about alternative perfumery?

 

The success of department stores on the ultra-luxury segment and the difficulties of traditional independent perfumeries also highlight the relative lack of data regarding the differentiation strategy adopted by some independent retailers that have chosen to specialize in alternative perfumery brands.

 

Today, only few French cities do not have a perfume shop specialized in this segment, and all of them do not seem to have to fight to survive. Ombre Portées now counts an e-commerce website and five perfumeries throughout the French territory, and has announced the opening of a new store in Brittany for the first quarter 2015. As for Sens Unique, the iconic alternative perfumery based in the Marais quarter in the heart of Paris, it has just inaugurated a new branch in Caen, France. That is enough to justify further research!

 

Vincent Gallon with AFP/Relaxnews

Footnotes

 

[1] The NPD Group only takes into account the prestige brands’ product sales made in the physical points of sale of department stores, chains and specialized franchises such as Sephora, Marionnaud, Nocibé, Beauty Success, and by independent retail stores. This means the institute does not take into account online sales and sales of private brands or exclusive brands’ products, which represent the major part of many retailers’ turnovers. It is to be noted that the sales of “niche” perfumes and of points of sale specialized in these products are not entirely taken into account either.