The first is that there are more small brands than ever: 271 this year, with 80 of those showing for the first time. This reflects the success of niche brands in general over the last ten years, where they’ve often outperformed the big boys – but it also suggests that the sector is becoming unsustainably overcrowded.
— Wallpaper evaluates "the pulse of the niche-perfume sector" at the Pitti Fragranze fair in Florence. Read more at Nosing out niche perfumes and bold packaging at Pitti Fragranze.
We are just seeing a natural economic behaviour in this. Until there is demand, the demand keeps growing and you keep having new enters. There is a point where you achieve the equilibrium and you’ll have a stable number of brands or a decline to fit the demand. And i’m pretty sure that in some moment or other niche will just become not interesting for the consumer, like mainstream brands, and then we’ll probably have something else rising (i suspect maybe a bespoke-ish thing?)
Eventually, but I think you’re assuming more rational behavior in the market than really exists. I’m not sure that there is really any huge natural effect on the number of new niche brands in the short run — people see the money and they want to give it a shot. And nobody really keeps track of how many brands launch and then fail. So as long as the total number of dollars going towards niche fragrance rises, you’ll still see way more new niche brands than the market can sustain.
Would also say that I truly believe that part of what happened to the mainstream (and mass) market was just this: too many launches, no real incentive for an individual brand to cut the number of launches. So I think niche — and “luxury” niche — is basically shooting themselves in the foot. I have not seen anything to suggest mainstream reached anything that I would call equilibrium — mainstream launches have not gone down significantly even though people are at the moment not spending as much money on mainstream as they are on niche.
Yes, they are repeating the same errors for sure. I also have the same impression and i think that the final result will be the same. Too many of everything makes it loose its special appeal and them becoming something that it’s not interesting anymore.
It’s so frustrating this lack of data that would let us really study this market better. And i do think that the market is rational in its behaviour, but i do also think that it has a kind of delay in seeing this too. And i don’t see this change in the sort run too, it’s more of a long run – maybe 5 years or more.
Also, i find quite hard to call this market niche to be honest since it keeps growing and becoming bigger and bigger. Even distribution doesn’t seem to be anymore a good definition for niche for me.
Yes — the delay though is big enough to cause a lot of harm! I have a feeling Coty would have taken the Estee Lauder approach (invest in / buy up expensive niche brands) rather than the mainstream approach (buy P&G’s fragrance lines) if they had only had a crystal ball.
And yes again. Niche has become meaningless as a category. It is too bad — I’m sure there are some great new fragrance brands out there, but I have so little interest in trying new niche fragrance brands that I’ll probably never find the good ones.
Robin, in my opinion the best things being launched recently are comming from indie brands. I still try to test as many niche as i can, but i it’s out of my reach on skin/time.
The problem in those markets is that usually the brands able to survive are the ones inside biggest companies. And working on one i can totally see the conservative approach being put in front of innovation. Specially on a economic scenario of many doubts. I don’t see many risking to loose so much money with a launch like you had in the past with Christian Lacroix for instance.
Coty is stuck on its mentality/system, this is very hard to change in a big company.
If at least Coty took an approach in preserving and going upscale with their legacy it would be something. Why make it cheap their most iconic and historical fragrances? It’s so sad
Completely agree about Coty! And I’m sure you’re right about indie. I just run out of time and energy for new brands.