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New formats and e-commerce drive sales of home fragrances in the U.S
Source:Premium Beauty News From:Taiwan Trade Center, Los Angeles Update Time:2018/08/17
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A new breakthrough has shown that the U.S. Home Fragrances Market is on pace to surpass its previous 2017 growth, with Online Sales contributing to a large portion of its outstanding market performance according to a Home Fragrances : U.S Market Analysis and Opportunities report done by consulting firm Kline . A recurring trend is that mass market candles command the majority of the market, however there are also clear signs of growth spread across the board such as the double digit growth small luxury companies are experiencing.

“This market, especially the candles category, continues to perform well as consumers remain attracted to these products for their beautiful designs, sensory experiences, and giftable aesthetic,” comments Dana Kreutzer, Senior Analyst in Kline’s Consumer Products Practice. “Moreover, e-commerce and technology are transforming this segment with new user experiences, where luxury brands and small start-ups alike are racing to embrace e-commerce, making this channel even stronger.”

 

Increased competition

As far as retail distribution, this markets’ progression through brands has made it more effective in penetrating the mass market, such as what the company Yankee Candle has done. Yankee Candle’s parent brand, Newell Brands, for example has evolved since making its way into Walmart by opening up its first experimental pop-up shop during the holiday season, as an attempt to satisfy the craving their consumers had for new and exclusive items.

The competition among large market players continues to remain competitive. Newell Brands quickly became the market giant, however, with the addition of WoodWick and Chesapeake Bay Candle brands to its home fragrance portfolio in 2017, as well as Bath & Body Works, one of the largest prestige brands, have all contributed to its excellent performance. In contrast, the smaller, luxury players are surprisingly more influential in moving the market. These include brands such as Voluspa, Nest, Illume, and Paddywax which are all among the strongest performers and had double-digit gains throughout 2017.

This direct sales channel demonstrated increased advances at a rate of 10% in 2017, while candle sales through the channel continued to grow at a rate above that number.

 

Candles dominate

Candles nonetheless remain the largest product category in 2017, contributing more than 41% to overall market sales. In addition, several new luxury marketers will be entering the segment in 2017, including Gibson & Dehn and HomeWorx by Harry Slatkin, selling its products via another popular retailer - home shopping network - QVC. Yankee Candle however remains the dominant market leader in this category despite the growth of several smaller prestige brands.

Diffusers, are also being seen as a segment enjoying the consumers’ favour. This category is particularly innovative with fragrance meeting technology and smart scent diffusers which allows consumers the ability to control and customize their home scent experiences. Brands like Moodo and Aera continue to develop new delivery formats, such as the launch of liquidless reed diffusers by Nest and Diptyque, which add additional attractivity to the segment.