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NPD Group: Growth in men’s fragrance sales fueled by larger sizes, gift sets

BY Antoinette Alexander

PORT WASHINGTON, N.Y. — Sales of U.S. prestige men’s fragrances are on the rise, according to recent research by global information company The NPD Group.

Sales of U.S. prestige men’s fragrance increased 6% to $953 million, from May 2012 to April 2013, compared with the same time period last year, according to The NPD Group’s U.S. fragrance industry.

The 2013 Men’s FragranceTrack study by The NPD Group indicates that 63% of adult males ages 18 years to 64 years wear fragrance at least occasionally, with 23% indicating they use it all of the time, and 40% of men who wear a scent have just one bottle at home that they use. Conversely, nearly 40% of males ages 18 years to 64 years never use fragrance.

“Men are creatures of habit when it comes to their scent selection, remaining loyal to what they know and like,” stated Karen Grant, VP and senior global industry analyst for The NPD Group. “While they are driven primarily by practical factors, and are less focused on choosing scents because of an emotional appeal, such as being memorable, romantic or different, men’s fragrance decisions are heavily influenced by the key people in their lives.”

Seventy-two percent of adult male fragrance wearers started using fragrance when they were 17 years old or younger. Almost 40% of male teen fragrance wearers, ages 13 years to 17 years, were influenced by their fathers to wear fragrance, and even more chose to wear a fragrance to impress a girl.

Among male adults, when choosing a scent, the most important factor was that a woman/partner liked it. Men also shop for a long-lasting fragrance that can be worn every day and for all occasions. "Clean," "masculine" and "fresh" round out the attributes cited among the most important to men when selecting a fragrance.

Out of those men that made a fragrance purchase in the past year, 25% purchased a pre-packaged gift set as a result of the perceived value, and the ancillaries included in the set. Larger fragrance sizes present a value proposition as well. Unit sales of men’s fragrance, in sizes 6.7 oz. and up, increased 12% from May 2012 to April 2013 compared with the previous year. These larger sizes represented more than 6% of dollar sales during the same timeframe.

“Men, and those who purchase fragrance for them, are spending 4% more on fragrances than they did a year ago, specifically on more expensive gift sets, and on larger size bottles. With a quarter of adult men who wear fragrance saying that they never purchase it for themselves, fragrance becomes the perfect, low-stress gift for the man in your life. His scent selections don’t vary much, his requirements are generally basic, and if you like it, it is almost certain he will like it,“ Grant stated.

“The drivers behind men’s fragrance decisions are not complicated, but they are specific, and reaching the male fragrance consumer is as much about reaching the people around him as connecting with the man himself,” Grant added.

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BioScrip to acquire CarePoint Partners for $223 million

BY Alaric DeArment

ELMSFORD, N.Y. — BioScrip will acquire a Cincinnati-based home infusion company for $223 million, BioScrip said Monday.

BioScrip, an Elmsford, N.Y.-based specialty pharmacy provider, said the acquisition of CarePoint Partners Holdings would complement its business, as both companies are providers of home-infusion services. CarePoint Partners is expected to generate about $160 million in annual sales and serves about 20,500 patients each year, with 28 sites in nine states on the East Coast and Gulf Coast regions. Combined, the two companies will serve about 100,000 patients.

"CarePoint Partners is a highly regarded infusion company with a national reputation for clinical excellence, high-quality customer service and superior patient care," BioScrip president and CEO Rick Smith said. "With its strong clinical capabilities, CarePoint Partners has delivered consistent, long-term growth and is now one of the 10 largest home infusion companies."

 

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Survey: Retailers ready to spend on technology, expansion, branding to drive growth

BY Antoinette Alexander

NEW YORK — Retailers are increasingly recognizing that technology is key to driving growth and bolstering customer engagement, and research suggests that companies take an omnichannel approach to reach shoppers in today’s challenging environment plagued by changing consumer confidence and high national unemployment rates, according to recent research.

According to the 2013 Retail Outlook Survey by KPMG LLP, the U.S. audit, tax and advisory firm, retail executives say they will be investing capital to spur growth, with an emphasis on expansion and enhanced technology,

"Technology is paramount to driving growth and enhancing customer engagement for retailers," stated Mark Larson, KPMG global retail leader. "With consumer behavior, spending and demographic profiles changing rapidly, it is absolutely critical that companies take an omnichannel approach to engage consumers, utilizing all the platforms at their disposal, including brick and mortar, online and mobile."

Most executives (85%) expect capital spending will increase or remain the same over the next year. When asked where they will increase spending most, executives most frequently cited geographic expansion (61%), information technology (40%), and advertising and marketing/branding (24%).

When asked which technology-related trends are having a significant impact on retail businesses, executives most frequently cited social media (71%), mobile and online shopping (52%), and mobile and online promotions and coupons (51%). In addition, the 71% of executives who say their companies are using social media to reach more customers and explore new ways of doing business is up significantly from 58% in last year’s survey.  

Data and analytics is also a tremendous opportunity for retailers, according to the research. In fact, when asked about how their companies are leveraging data, executives most frequently cited that data analytics plays a key role in helping provide customer insight (72%), as well as in the areas of brand and product management (67%) and pricing decisions (56%). Executives also say they use data to drive operational excellence and actionable insights (50%), and acquire customers (36%). However, a gap exists between this opportunity and retailers’ ability to realize it, as 43% of respondents rate their companies’ data analytics literacy as only average.

"A key to success will be investing in technology to harness the vast amounts of structured data that reside in a company as well as the unstructured data online and in social media," added Larson. "That data can drive the insights that will allow retailers to interact with consumers more effectively and capture more ‘wallet-share’, as well as identify new markets, new strategies and new operating models to generate growth and profitability."

On the topic of cloud computing, more than two-thirds (68%) indicate they have adopted, or plan to adopt, cloud technologies into their business strategies and operations. In addition, the 2013 survey shows significant change in how executives view the impact of cloud computing on their business models and operations. Thirty-seven percent indicate cloud will provide management with greater transparency on transactions and 31% say it will reduce costs, up from 11% and 14%, respectively, in 2012.

Regulation and legislation


Despite the positive outlook on innovative use of technology-related trends on the industry, retail executives are increasingly concerned with the impact of government on their businesses. Thirty percent of respondents cite increased government regulation as a major factor hindering industry growth, nearly double from the 16% reported in the 2012 survey.

Furthermore, in addressing barriers to company growth, 22% of respondents indicate regulatory and legislative pressures and increased taxation as top of mind, both increases from last year’s results of 15% and 19%, respectively. In addition, when asked what poses a major threat to their business model, 42% cited political/regulatory uncertainty.

To that extent, most retail executives say their organizations are most focused on regulatory issues around healthcare reform (54%) and labor/immigration laws (41%). Despite these challenges, 89% of respondents believe their company is somewhat (60%) or very (29%) prepared to manage the impact of public policy and regulatory change. When asked to identify existing challenges preventing the adoption of a formal risk policy, 39% of respondents indicate culture and behavior as significant obstacles, process integration/efficiency of operations (24%), clearly defined roles and responsibilities (23%), and shared resources across the organization (21%).

Revenue and industry outlook


In the 2013 survey, nearly three-quarters of executives report increased revenue over 2012, up nine points from the previous year. Furthermore, 85% of retail executives indicate the retail industry will see growth in the coming year, however, of those, 74% point to only modest gains of 5% or less.

Nearly three-quarters of respondents expect retaining (37%) and adding customers (35%) as key growth drivers, followed by improving economic conditions (29%) and innovative merchandising strategies (26%). More than half (58%) identify decreased consumer confidence as the highest factor hindering growth, followed by high national unemployment rates (45%), and increased government regulation (30%).


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