The ASSOCHAM study, titled 'Domestic Fragrance Industry: The Way Ahead', puts the current size of the industry at INR3,700 crores, with nearly 30 percent of the sector being unorganised. This includes the deodorant market worth INR1,800 crore, the perfume market worth INR1,500 crore, and the roll-on market worth INR400 crore.
The study has revealed that the deodorant market in India is growing at approximately 55 percent annually, while the perfume market is growing at the rate of nearly 30 percent per annum.
"Rising demand for fragrances from Tier II and III markets is the real growth driver of this industry. As a result, companies are gradually shifting their focus from metros, exploring other markets, and gearing to launch a range of affordable deodorants, perfumes and colognes during summers," the study says.
The ASSOCHAM study reveals that almost 60 percent of the fragrance industry in India is made up of men's products, owing to the growing trend of the metrosexual male. It speaks of the comparitively limited options in women's fragrances, and the possibility of several existing brands and new entrants surging into this space.
In addition, the study has revealed that a major part of the demand for fragrances comes from the coastal cities in India.
It states that nearly 50 percent of the total demand of fragrances in the country are for gifting purposes, and keeping this in view, companies have begun to focus more and more on attractive packaging in order to push sales.
DS Rawat, Secretary General of ASSOCHAM, who released the study, stated: "The fragrance industry in India is still at a nascent stage, but its rising demand is largely driven by growing awareness and preferences amid the strong Indian middle class with high disposable incomes, as they do not shy away from splurging on lifestyle products to look and feel good."
Source: SME Times