UK Fragrance Industry

INDUSTRY PROFILE
Fragrances in the United Kingdom

Reference Code: 0183-0703 Publication Date: September 2011
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United Kingdom - Fragrances

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EXECUTIVE SUMMARY
EXECUTIVE SUMMARY
Market value
The United Kingdom fragrances market grew by 7% in 2010 to reach a value of $1,759.6 million.
Market value forecast

In 2015, the United Kingdom fragrances market is forecast to have a value of $2,396.1 million, an increase of 36.2% since 2010.
Market volume
The United Kingdom fragrances market grew by 6% in 2010 to reach a volume of 44.3 million units.
Market volume forecast

In 2015, the United Kingdom fragrances market is forecast to have a volume of 56.4 million units, an increase of 27.3% since 2010.
Market segmentation I
Female fragrances is the largest segment of the fragrances market in the United Kingdom, accounting for 63.4% of the market's total value.
Market segmentation II
The United Kingdom accounts for 10.9% of the European fragrances market value.
Market share
Procter & Gamble Company, The is the leading player in the United Kingdom fragrances market, generating a 21.1% share of the market's value.
Market rivalry
The UK fragrances market is fairly concentrated, with the top three players accounting for 43.7% of the market value.

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CONTENTS
TABLE OF CONTENTS
EXECUTIVE SUMMARY MARKET OVERVIEW Market definition Research highlights Market analysis MARKET VALUE MARKET VOLUME MARKET SEGMENTATION I MARKET SEGMENTATION II MARKET SHARE FIVE FORCES ANALYSIS Summary Buyer power Supplier power New entrants Substitutes Rivalry LEADING COMPANIES Procter & Gamble Company, The Coty Inc Este Lauder Companies Inc., The MARKET DISTRIBUTION MARKET FORECASTS Market value forecast Market volume forecast MACROECONOMIC INDICATORS APPENDIX Methodology
2 7 7 8 9 10 11 12 13 14 15 15 17 18 19 20 21 22 22 27 29 33 34 34 35 36 38 38
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CONTENTS
Industry associations Related Datamonitor research Disclaimer ABOUT DATAMONITOR Premium Reports Summary Reports Datamonitor consulting
39 39 41 42 42 42 42

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CONTENTS
LIST OF TABLES
Table 1: Table 2: Table 3: Table 4: Table 5: Table 6: Table 7: Table 8: Table 9: Table 10: Table 11: Table 12: Table 13: Table 14: Table 15: Table 16: Table 17: Table 18: Table 19: Table 20: Table 21: United Kingdom fragrances market value: $ million, 200610 United Kingdom fragrances market volume: million units, 200610 United Kingdom fragrances market segmentation I:% share, by value, 2010 United Kingdom fragrances market segmentation II: % share, by value, 2010 United Kingdom fragrances market share: % share, by value, 2010 Procter & Gamble Company, The: key facts Procter & Gamble Company, The: key financials ($) Procter & Gamble Company, The: key financial ratios Coty Inc: key facts Este Lauder Companies Inc., The: key facts Este Lauder Companies Inc., The: key financials ($) Este Lauder Companies Inc., The: key financial ratios United Kingdom fragrances market distribution: % share, by value, 2010 United Kingdom fragrances market value forecast: $ million, 201015 United Kingdom fragrances market volume forecast: million units, 201015 United Kingdom size of population (million), 200610 United Kingdom gdp (constant 2000 prices, $ billion), 200610 United Kingdom gdp (current prices, $ billion), 200610 United Kingdom inflation, 200610 United Kingdom consumer price index (absolute), 200610 United Kingdom exchange rate, 200610 10 11 12 13 14 22 24 25 27 29 31 31 33 34 35 36 36 36 37 37 37

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CONTENTS
LIST OF FIGURES
Figure 1: Figure 2: Figure 3: Figure 4: Figure 5: Figure 6: Figure 7: Figure 8: Figure 9: United Kingdom fragrances market value: $ million, 200610 United Kingdom fragrances market volume: million units, 200610 United Kingdom fragrances market segmentation I:% share, by value, 2010 United Kingdom fragrances market segmentation II: % share, by value, 2010 United Kingdom fragrances market share: % share, by value, 2010 Forces driving competition in the fragrances market in the United Kingdom, 2010 Drivers of buyer power in the fragrances market in the United Kingdom, 2010 Drivers of supplier power in the fragrances market in the United Kingdom, 2010 Factors influencing the likelihood of new entrants in the fragrances market in the United Kingdom, 2010 Factors influencing the threat of substitutes in the fragrances market in the United Kingdom, 2010 Drivers of degree of rivalry in the fragrances market in the United Kingdom, 2010 Procter & Gamble Company, The: revenues & profitability Procter & Gamble Company, The: assets & liabilities Este Lauder Companies Inc., The: revenues & profitability Este Lauder Companies Inc., The: assets & liabilities United Kingdom fragrances market distribution: % share, by value, 2010 United Kingdom fragrances market value forecast: $ million, 201015 United Kingdom fragrances market volume forecast: million units, 201015 10 11 12 13 14 15 17 18
19
Figure 10:
20 21 25 26 32 32 33 34 35
Figure 11: Figure 12: Figure 13: Figure 14: Figure 15: Figure 16: Figure 17: Figure 18:

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MARKET OVERVIEW
MARKET OVERVIEW
Market definition
The fragrances market consists of the retail sale of female fragrances, male fragrances and unisex fragrances. The market is valued according to retail selling price (RSP) and includes any applicable taxes. Any currency conversions used in the compilation of this report have been calculated using 2010 annual average exchange rates. For the purpose of this report Europe comprises Belgium, the Czech Republic, Denmark, France, Germany, Hungary, Italy, the Netherlands, Norway, Poland, Romania, Russia, Spain, Sweden, Ukraine, Turkey, Ireland, Greece, Switzerland, Austria, Portugal, Finland, Croatia, Bulgaria, Lithuania, Latvia, Slovenia, Slovakia, Estonia and the United Kingdom.

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MARKET OVERVIEW
Research highlights
The UK fragrances market generated total revenues of $1.8 billion in 2010, representing a compound annual growth rate (CAGR) of 8.7% for the period spanning 2006-2010. Female fragrances sales proved the most lucrative for the UK fragrances market in 2010, generating total revenues of $1.1 billion, equivalent to 63.4% of the market's overall value. The performance of the market is forecast to decelerate, with an anticipated CAGR of 6.4% for the fiveyear period 2010-2015, which is expected to lead the market to a value of $2.4 billion by the end of 2015.

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MARKET OVERVIEW
Market analysis
The UK fragrances market grew at a strong rate during the period 2006-2010, as a result of strong sales growth in the female fragrances category. The overall market growth is expected to decelerate in the forthcoming five years. The UK fragrances market generated total revenues of $1.8 billion in 2010, representing a compound annual growth rate (CAGR) of 8.7% for the period spanning 2006-2010. In comparison, the French and German markets grew with CAGRs of 1.8% and 0.3% respectively, over the same period, to reach respective values of $2.8 billion and $2.4 billion in 2010. Market consumption volumes increased with a CAGR of 7.1% between 2006 and 2010, to reach a total of 44.3 million units in 2010. The market's volume is expected to rise to 56.4 million units by the end of 2015, representing a CAGR of 4.9% for the 2010-2015 period. Female fragrances sales proved the most lucrative for the UK fragrances market in 2010, generating total revenues of $1.1 billion, equivalent to 63.4% of the market's overall value. In comparison, sales of male fragrances generated revenues of $605.4 million in 2010, equating to 34.4% of the market's aggregate revenues. The performance of the market is forecast to decelerate, with an anticipated CAGR of 6.4% for the fiveyear period 2010-2015, which is expected to lead the market to a value of $2.4 billion by the end of 2015. Comparatively, the French and German markets will grow with CAGRs of 1.7% and 0.2% respectively, over the same period, to reach respective values of $3 billion and $2.4 billion in 2015.

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MARKET VALUE
MARKET VALUE
The United Kingdom fragrances market grew by 7% in 2010 to reach a value of $1,759.6 million. The compound annual growth rate of the market in the period 200610 was 8.7%. Table 1: Year 2006 2007 2008 2009 2010 CAGR: 200610 Source: Datamonitor United Kingdom fragrances market value: $ million, 200610 $ million 1,262.2 1,422.8 1,532.6 1,644.4 1,759.6 million 817.3 921.3 992.4 1,064.8 1,139.4 million 951.6 1,072.6 1,155.4 1,239.7 1,326.6 % Growth 12.7% 7.7% 7.3% 7.0% 8.7% DATAMONITOR
Figure 1:
United Kingdom fragrances market value: $ million, 200610
Source: Datamonitor
DATAMONITOR

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MARKET VOLUME
MARKET VOLUME
The United Kingdom fragrances market grew by 6% in 2010 to reach a volume of 44.3 million units. The compound annual growth rate of the market in the period 200610 was 7.1%. Table 2: Year 2006 2007 2008 2009 2010 CAGR: 200610 Source: Datamonitor United Kingdom fragrances market volume: million units, 200610 million units 33.7 36.3 39.3 41.8 44.3 % Growth 7.7% 8.3% 6.4% 6.0% 7.1% DATAMONITOR
Figure 2:
United Kingdom fragrances market volume: million units, 200610
Source: Datamonitor
DATAMONITOR

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MARKET SEGMENTATION I
MARKET SEGMENTATION I
Female fragrances is the largest segment of the fragrances market in the United Kingdom, accounting for 63.4% of the market's total value. The male fragrances segment accounts for a further 34.4% of the market. Table 3: Category Female fragrances Male fragrances Unisex fragrances Total Source: Datamonitor United Kingdom fragrances market segmentation I:% share, by value, 2010 % Share 63.4% 34.4% 2.2% 100% DATAMONITOR
Figure 3:
United Kingdom fragrances market segmentation I:% share, by value, 2010
Source: Datamonitor
DATAMONITOR

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MARKET SEGMENTATION II
MARKET SEGMENTATION II
The United Kingdom accounts for 10.9% of the European fragrances market value. France accounts for a further 17.9% of the European market. Table 4: Category France Germany United Kingdom Italy Rest of Europe Total Source: Datamonitor United Kingdom fragrances market segmentation II: % share, by value, 2010 % Share 17.9% 15.2% 10.9% 8.9% 47.2% 100% DATAMONITOR
Figure 4:
United Kingdom fragrances market segmentation II: % share, by value, 2010
Source: Datamonitor
DATAMONITOR

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MARKET SHARE
MARKET SHARE
Procter & Gamble Company, The is the leading player in the United Kingdom fragrances market, generating a 21.1% share of the market's value. Coty Inc accounts for a further 14.2% of the market. Table 5: Company Procter & Gamble Company, The Coty Inc Este Lauder Companies Inc., The Others Total Source: Datamonitor United Kingdom fragrances market share: % share, by value, 2010 % Share 21.1% 14.2% 8.4% 56.3% 100% DATAMONITOR
Figure 5:
United Kingdom fragrances market share: % share, by value, 2010
Source: Datamonitor
DATAMONITOR

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FIVE FORCES ANALYSIS

The fragrances market will be analyzed taking personal care products manufacturers and large fashion houses as players. The key buyers will be taken as retailers, and manufacturers of chemicals, packaging, and manufacturing equipment as the key suppliers.
Summary
Figure 6: Forces driving competition in the fragrances market in the United Kingdom, 2010
Source: Datamonitor
DATAMONITOR
The UK fragrances market is fairly concentrated, with the top three players accounting for 43.7% of the market value. Department stores are the main buyers in the UK fragrances market and often occupy a strong position in the supply chain, which allows them to negotiate favorable contracts with manufacturers, thereby enhancing buyer power. However, major manufacturers tend to advertise in order to build brand loyalty. This reduces buyer power, as most retailers must stock popular brands in order to maintain their own sales volumes, with little option for alternatives. The raw materials (such as chemicals) used in manufacturing of fragrances should be of high quality and for some ingredients there are no substitutes available, which increases supplier power. A small number of brands, some globally recognized, have a strong position in this market. The major companies are large firms whose economies of scale allow them to compete more effectively on price, and invest in their own business and therefore small scale companies entering the market may find it difficult to compete. Many of the leading players are either

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manufacturers of personal care products or large fashion houses. Such business diversification of the market players eases competitive pressure in any given market, which is assessed as moderate.

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Buyer power
Figure 7: Drivers of buyer power in the fragrances market in the United Kingdom, 2010
Source: Datamonitor
DATAMONITOR
The major buyers within the UK fragrances market are considered to be department stores (incl. duty-free shops) (about 35.5% of the total distribution) who offer fragrances products to their customers. Advertising plays a crucial role in this market as strong brand and building customer loyalty may provide the buyers and manufacturers with brand loyal customers. This factor becomes even more important in the market where end users have no switching costs and do tend to switch brands. In order to boost sales, marketing companies often use celebrity endorsements for promoting brands as the majority of people are swayed by a celebrity's image. This reduces buyer power, as most retailers must stock popular brands in order to maintain their own sales volumes, with little option for alternatives. However, retailers often occupy a strong position in the supply chain, which allows them to negotiate favorable contracts with manufacturers, thereby enhancing buyer power. Direct selling is also possible in the fragrances market: for example, manufacturer Avon avoids the conventional retail distribution network, by using a direct sales force. Overall, buyer power in the fragrances market is assessed as moderate.

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Supplier power
Figure 8: Drivers of supplier power in the fragrances market in the United Kingdom, 2010
Source: Datamonitor
DATAMONITOR
Suppliers in the fragrances market include suppliers and manufacturers of raw materials such as chemicals, packaging, and manufacturing equipment. The quality of raw materials is of core importance in the fragrances market. Chemicals used for manufacturing consumer products must be of a suitable standard, although for some ingredients there are no substitutes, a factor which increases supplier power. Suppliers are often small in scale compared to the large manufacturers, lacking the price negotiating power and consequently their power is reduced. However, this factor is counterbalanced by the fact that chemical producers generate revenues from a wide variety of sources, reducing their dependence on fragrance product manufacturers. Overall the supplier power is assessed as moderate.

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New entrants
Figure 9: Factors influencing the likelihood of new entrants in the fragrances market in the United Kingdom, 2010
Source: Datamonitor
DATAMONITOR
The fragrances products market is primarily regulated by the International Fragrance Association (IFRA) which is mainly responsible for regulating the worldwide legislatives trends and keeping a check on health problems related to fragrance usage such as allergies or asthma. Additionally, the EU regulations pertaining to cosmetic products require companies to notify about cosmetics containing nanomaterials. The regulations also forbid companies from using substances in cosmetics that are carcinogenic, mutagenic, or toxic for reproduction. Nevertheless fragrance formulas are treated as "trade secrets" and manufactures are not obliged to reveal them to anyone, including regulatory agencies. . The European Commission announced its decision on Feb, 2011to ban the fragrance material musk xylene under the new European Chemicals Legislation REACH because of its potential effects on the environment. The UK fragrances product market has presence of large players such as Procter & Gamble and Coty. These companies have developed and acquired extensive product portfolios, and built brands with large marketing and advertising budgets. A small scale company would find it difficult to enter this market as it will have to compete with the established brands. Additionally, substantial funds are needed to start up a business in this market, with capital required for investment in production, distribution, and also advertising which is crucial to succeed in this market. One of the methods of establishing its brand is celebrity endorsements but it can become very costly for new players. Overall, the threat of new entrants with respect to the fragrance market is moderate.
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Substitutes
Figure 10: Factors influencing the threat of substitutes in the fragrances market in the United Kingdom, 2010
Source: Datamonitor
DATAMONITOR
Fragrances, perfumes in particular, used to be considered luxury products. However, this trend is changing with these products being sold at prices affordable for the mass public. Many personal hygiene products such as soaps, body wash products and even talcum powders to a certain extent provide a fragrance, and those products are often used by manufacturers to differentiate their product lines. The low price of such products compared to that of fine fragrances also increases the threat of substitute. Overall, the threat of substitute is moderate.

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Rivalry
Figure 11: Drivers of degree of rivalry in the fragrances market in the United Kingdom, 2010
Source: Datamonitor
DATAMONITOR
The UK fragrances products market is fairly concentrated, with the top three players accounting for 43.7% of the market value. Many of the leading players are either large manufacturers of personal care products or large fashion houses. Such business diversification of the market players eases competitive pressure in any given market. Fixed costs are high in this market, as most companies own large production facilities. Therefore the need to divest such assets on exiting the UK market constitutes an exit barrier. Such factors tend to enhance rivalry. Most of these companies are geographically diversified which weakens rivalry to some extent. Overall, rivalry in the fragrances market is moderate.

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LEADING COMPANIES
LEADING COMPANIES
Procter & Gamble Company, The
Table 6: Procter & Gamble Company, The: key facts 1 Procter & Gamble Plaza, Cincinnati, Ohio 45202, USA 1 513 983 1100 1 513 983 4381 The Heights, Brooklands, Weybridge, Surrey, KT13 0XP, GBR 44 1932 896 000 44 1932 896 200 www.pg.com June PG NYSE DATAMONITOR
Head office: Telephone: Fax: Local office: Telephone: Fax: Website: Financial year-end: Ticker: Stock exchange: Source: company website
Procter & Gamble Company (P&G) is engaged in the manufacture and marketing of consumer products. The company markets more than 300 brands in over 180 countries spanning the Americas, Europe, the Middle East and Africa (EMEA), and Asian region. It is headquartered in Cincinnati, Ohio and employs about 129,000 people. P&G sells its products through mass merchandisers, grocery stores, membership club stores, drug stores and in high-frequency stores. P&G is organized into two global business units (GBUs): beauty & grooming and household care. The GBUs identify common consumer needs, develop new products and build its brands. The business units comprising the GBUs are aggregated into six reportable segments: beauty; grooming; health care; snacks and pet care; fabric care and home care; and baby care and family care. The beauty and grooming comprises of the beauty, grooming and healthcare businesses while household care GBU consists of snacks and pet care; fabric care and home care; baby care and family care businesses. The beauty segment includes cosmetics, deodorants, hair care, skin care, prestige fragrances and personal cleansing. The hair care sub-segment consists of conditioner, hair colorants, salon products, shampoo and styling agents. The key brands offered by the segment include Head & Shoulders, Olay, Pantene, Head and Shoulders, Aussie, Fekkai, Nioxin and Wella. The key brands offered in the deodorant category include Old Spice, Secret and Gillette. Personal cleansing products include brands

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LEADING COMPANIES
such as Camay, Gillette, Ivory, Olay, Old spice, and Zest in the body wash category. The key facial care brand marketed by the company includes Olay. The grooming segment comprises blades and razors, face and shave preparation products (such as shaving cream), electric hair removal devices and small household appliances. The key brands marketed by the grooming segment include Braun, Fusion, Gillette and Mach3. The electric hair removal devices and small home appliances are marketed under the Braun brand. The healthcare segment includes feminine care, gastrointestinal, incontinence, rapid diagnostics, respiratory, toothbrush, toothpaste, water filtration and other oral care. The oral care products are marketed worldwide under the brands Always, Crest and Oral-B. In December 2008, Panasonic Electric Works entered into a supply agreement with P&G to supply its Palsonic electric toothbrush, which P&G introduced in the US and European markets during late 2009 under its own brand name. The snacks and pet care segment markets its products under the brands lams and Pringles. In the snacks business, the company sells potato chips through its Pringles brand. The fabric care and home care segment offers a wide range of fabric care products including laundry cleaning products and fabric conditioners; and home care products, including dish care, surface cleaners and air fresheners; and batteries. The segment markets its products under Ace, Ariel, Dawn, Downy, Duracell, Gain, Tide and Febreze brands. The baby care and family care segment offers baby wipes,, diapers, tissues, paper towels and paper tissues under the following brands: Bounty, Charmin and Pampers. The companys family care business primarily operates in North America. The global operations group consists of the market development organization (MDO). The MDO comprises retail customer, trade channel and country-specific teams. . It is organized along five geographic regions: North America, Western Europe, Central & Eastern Europe/Middle East/Africa (CEEMEA), Latin America and Asia (comprises Japan, Greater China and ASEAN/Australia/India/Korea (AAIK)). The developing markets include CEEMEA, Latin America, AAIK and Greater China while the developed markets are comprised of North America, Western Europe and Japan. The global business services (GBS) provides technology, processes and standard data tools to support the operations of GBUs and the MDO. The GBS organization is responsible for providing world-class solutions at a low cost and with minimal capital investment.. Corporate functions provide company-level strategy and portfolio analysis, corporate accounting, treasury, external relations, governance, human resources and legal, as well as other centralized functional support.

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LEADING COMPANIES
In the US, the company operates through 36 manufacturing facilities located in 22 different states or territories. The company operates other 102 manufacturing facilities in 41 other countries. Beauty products are manufactured at 39 of these manufacturing facilities, grooming products at 17; fabric care and home care products at 52; baby care and family care products at 31; snacks and pet care products at 11 and health care products at 35. On March 2011, Procter and Gamble signed a joint venture with Teva, a producer of generic drugs to create a new company dealing in over-the-counter drug. Key Metrics The company recorded revenues of $82.6 billion in the financial year (FY) ended June 2011, an increase of 4.6% over FY2010. The net profit of the company was $11.8 billion in FY2011, a decrease of 7.4% over FY2010. During FY2011, the beauty division recorded revenues of $20.2 billion, an increase of 3.4% over 2010. International accounted for 63.1% of the total revenues in FY2011. Revenues from International reached $52.1 billion in FY2011, an increase of 6.5% over FY2010.
Table 7: $ million
Procter & Gamble Company, The: key financials ($) 2007 72,441.0 10,340.0 138,014.0 71,254.0 138,000 2008 79,257.0 12,075.0 143,992.0 74,208.0 138,000 2009 76,694.0 13,436.0 134,833.0 71,451.0 135,000 2010 78,938.0 12,736.0 128,172.0 66,733.0 127,000 2011 82,559.0 11,797.0 138,354.0 70,353.0 129,000
Revenues Net income (loss) Total assets Total liabilities Employees Source: company filings
DATAMONITOR

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LEADING COMPANIES
Table 8: Ratio
Procter & Gamble Company, The: key financial ratios 2007 14.3% 6.2% 1.7% (2.1%) 51.6% 7.6% $524,935 $74,928 2008 15.2% 9.4% 4.3% 4.1% 51.5% 8.6% $574,326 $87,500 2009 17.5% (3.2%) (6.4%) (3.7%) 53.0% 9.6% $568,104 $99,526 2010 16.1% 2.9% (4.9%) (6.6%) 52.1% 9.7% $621,559 $100,283 2011 14.3% 4.6% 7.9% 5.4% 50.8% 8.9% $639,992 $91,450
Profit margin Revenue growth Asset growth Liabilities growth Debt/asset ratio Return on assets Revenue per employee Profit per employee Source: company filings
DATAMONITOR
Figure 12: Procter & Gamble Company, The: revenues & profitability
Source: company filings
DATAMONITOR

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LEADING COMPANIES
Figure 13: Procter & Gamble Company, The: assets & liabilities
DATAMONITOR

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LEADING COMPANIES
Coty Inc
Table 9: Head office: Telephone: Fax: Local office: Telephone: Fax: Website: Financial year-end: Source: company website Coty Inc: key facts Two Park Avenue 17th Floor, New York City, New York 10016, USA 1 212 479 4300 1 866 336 6064 Coty UK Ltd., 5 St. George's Road, St. George's House, Wimbledon, London SW19 4DR, GBR 44 208 971 1300 44 208 971 1399 www.coty.com June DATAMONITOR
Coty is a privately held company engaged in manufacturing and marketing of fragrances, color cosmetics, toiletries, skincare, sun care and personal care products. The company operates in more than 30 countries and distributes its products to around 90 countries worldwide. It is headquartered in New York City, New York and employs more than 8,500 people. The company is comprised of two divisions: Coty Prestige and Coty Beauty. Coty Prestige is engaged in manufacturing and marketing of lifestyle and fashionable fragrances products under the brands Baby Phat, Balcenciaga, Calvin Klein, Cerruti, Chloe, Chopard, Davidoff, Jennifer Lopez, Jette Joop, Jil Sander, Joop!, Karl Lagerfeld, Kenneth Cole, L.A.M.B. fragrance Gwen Stefani, Lancaster, Marc Jacobs, Nautica, Nikos, Phat Farm, Sarah Jessica Parker, Vera Wang and Vivienne Westwood. In January 2009, JL Morison India Ltd entered into an exclusive distribution agreement with Coty Prestige Travel Retail and Export, a division of Coty Geneva, Switzerland, for distribution of various deodorant / fragrance products under brands Playboy, Tonino Lamborghini and Pierre Cardin in India. In Switzerland, the company launched Davidoff Cool Water Man and Davidoff Cool Water Woman fragrance brands in April 2010. Coty Beauty manufactures and markets fragrances, toiletries, color cosmetics, skin care, sun care and personal care products. These products are marketed under the brands such as Adidas, Aspen, Astor, Celine Dion, Chupa Chups, David & Victoria Beckham, Desperate Housewives, Esprit, excla.mation, Halle Berry, Isabella Rossellini, Jovan, Kate Moss, Kylie Minogue, Miss Sixty, Miss Sporty, Pierre Cardin, Playboy, Rimmel, Shania Twain, Stetson, and Vanilla Fields.
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LEADING COMPANIES
The company has research and development centers at New Jersey and Monaco; and operates manufacturing plants in Spain, France, Monaco, North Carolina and the UK. The companys distribution channels include department stores, specialty retailer, upscale perfumeries, pharmacies, mass market retailers and duty free shops in airport and cities. In January 2011, Coty Inc. acquired a majority stake in Chinese skin-care company TJoy Holdings Ltd to expand its presence in China. Key Metrics Coty recorded revenues of $3.6 billion in the financial year (FY) ended June 2010. The fragrances product category accounted for 62% of the total revenues during FY2010. Revenues from fragrances product category reached $2.2 billion in FY2009. Europe, Cotys largest geographical market, accounted for 57% of the total revenues during FY2010. Revenues from Europe reached $2.1 billion in FY2010.

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LEADING COMPANIES
Este Lauder Companies Inc., The

Table 10: Este Lauder Companies Inc., The: key facts 767 Fifth Avenue New York City, New York 10153, USA 1 212 572 4200 1 212 572 3941 www.elcompanies.com June EL New York DATAMONITOR
Head office: Telephone: Fax: Website: Financial year-end: Ticker: Stock exchange: Source: company website
The Estee Lauder Companies (Estee Lauder) manufactures and markets makeup, skin care, fragrances and hair care products in over 150 countries spanning the Americas, Europe, the Middle East, Africa and Asia Pacific. It has wholly-owned or majority-owned offices in 40 countries and territories. Since its foundation in 1946, the company has been controlled by the Lauder family. The members of the Lauder family have approximately 88% of the outstanding voting power in the company's common stock. It is headquartered in New York City, the US and employs around 31,200 people. Estee Lauder sells its products through different channels like department stores, specialty retailers, perfumeries, freestanding stores, direct response TV, travel retail, internet, and pharmacies, prestige hair salons and spas. The company also sells through freestanding company-owned stores and spas, Estee Lauder's authorized web sites, stores on cruise ships and direct marketing through television. Some of the best known brands of the company include Estee Lauder, Aramis, Clinique, Lab Series, Origins, M.A.C, Bobbi Brown, La Mer, Aveda, Jo Malone, Bumble and Bumble, Darphin and Ojon. The company is also the global licensee of the Kiton, Tommy Hilfiger, Donna Karan, Michael Kors, Sean John, Missoni, Tom Ford, Mustang, American Beauty, Flirt!, Good skin, grassroots, and Daisy Fuentes. Estee Lauder primarily operates through five product categories: makeup, skin care, fragrance, hair care and other. The makeup products category offers products such as lipsticks, mascaras, foundations, eyeshadows, nail polishes and powders. Many of the products are offered in an extensive array of shades and colors. The company also sells related items such as compacts, brushes and other makeup tools. The companys key brands for its makeup products include Estee lauder, Clinique, Origins, MAC, Bobbi Brown, Aveda, Darphin, American Beauty and Flirt.

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LEADING COMPANIES
Estee Lauder's skin care products category markets products for women and men including moisturizers, creams, lotions, cleansers, sun screens and self-tanning products. The key skin care brands marketed by the company in Malaysia include Estee Lauder and Clinique. In 2008, Estee Lauder acquired Ojon Corporation, which markets and sells Ojon hair care and skin care products. The fragrance products category offers a variety of fragrances for women and men. The fragrances are sold in various forms including perfume sprays and colognes, as well as lotions, powders, creams and soaps that are based on a particular fragrance. The companys fragrances category includes brands like Beautiful, Beyond Paradise, Celadon and Intuition among others. The hair care products category offers products primarily used in salons and freestanding retail stores;these include hair color and styling products, shampoos, conditioners and finishing sprays. The other products category includes the sales of ancillary products and services other than skin care, makeup, fragrance, and hair care products. The companys key skincare products brands include Lab Series, La Mer, Jo Malone, Darphin, Ojon, and American Beauty among others. In 2009 the company acquired Applied Genetics Incorporated Dermatics (AGI), a manufacturer of cosmetics ingredients. In April, 2011 Estee Lauder Companies Inc. announced that its Aramis and Designer Fragrances Division will assume the exclusive worldwide license for the fragrance and grooming business of the Ermenegildo Zegna Group, a one-hundred year old, billion-dollar Milan-based men's luxury clothing and accessory business. The license is effective July 1st 2011. Key Metrics The company recorded revenues of $8.8 billion in the financial year (FY) ended June 2011, an increase of 13% over FY2010. The net profit of the company was $700.8 million in FY2011, an increase of 46.5% over FY2010. The fragrance division recorded revenues of $1.2 billion in FY2011, an increase of 8.7% over 2010. Europe, the Middle East & Africa accounted for 37% of the total revenues in FY2011. Revenues from Europe, the Middle East & Africa reached $3.3 billion in FY2011, an increase of 13.9% over FY2010.

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LEADING COMPANIES
Table 11: $ million
Este Lauder Companies Inc., The: key financials ($) 2007 7,037.5 449.2 4,125.7 2,905.4 28,500 2008 7,910.8 473.8 5,011.2 3,331.4 32,000 2009 7,323.8 218.4 5,176.6 3,512.6 31,300 2010 7,795.8 478.3 5,335.6 3,370.2 31,200 2011 8,810.0 700.8 6,273.9 3,626.9 32,300
Revenues Net income (loss) Total assets Total liabilities Employees Source: company filings
DATAMONITOR
Table 12: Ratio
Este Lauder Companies Inc., The: key financial ratios 2007 6.4% 8.9% 9.0% 36.0% 70.4% 11.4% $246,930 $15,761 2008 6.0% 12.4% 21.5% 14.7% 66.5% 10.4% $247,213 $14,806 2009 3.0% (7.4%) 3.3% 5.4% 67.9% 4.3% $233,987 $6,978 2010 6.1% 6.4% 3.1% (4.1%) 63.2% 9.1% $249,865 $15,330 2011 8.0% 13.0% 17.6% 7.6% 57.8% 12.1% $272,755 $21,697
Profit margin Revenue growth Asset growth Liabilities growth Debt/asset ratio Return on assets Revenue per employee Profit per employee Source: company filings
DATAMONITOR

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LEADING COMPANIES
Figure 14: Este Lauder Companies Inc., The: revenues & profitability
DATAMONITOR
Figure 15: Este Lauder Companies Inc., The: assets & liabilities
DATAMONITOR

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DISTRIBUTION
MARKET DISTRIBUTION
Department Stores (incl. Duty-Free Shops) form the leading distribution channel in the United Kingdom fragrances market, accounting for a 35.5% share of the total market's value. Specialist Retailers accounts for a further 27.7% of the market. Table 13: Channel Department Stores (incl. Duty-Free Shops) Specialist Retailers Pharmacies / drugstores Others Total Source: Datamonitor United Kingdom fragrances market distribution: % share, by value, 2010 % Share 35.5% 27.7% 22.8% 14.0% 100% DATAMONITOR
Figure 16: United Kingdom fragrances market distribution: % share, by value, 2010
Source: Datamonitor
DATAMONITOR

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MARKET FORECASTS
MARKET FORECASTS
Market value forecast
In 2015, the United Kingdom fragrances market is forecast to have a value of $2,396.1 million, an increase of 36.2% since 2010. The compound annual growth rate of the market in the period 201015 is predicted to be 6.4%. Table 14: Year 2010 2011 2012 2013 2014 2015 CAGR: 201015 Source: Datamonitor United Kingdom fragrances market value forecast: $ million, 201015 $ million 1,759.6 1,876.0 1,997.3 2,124.2 2,257.5 2,396.1 million 1,139.4 1,214.8 1,293.3 1,375.5 1,461.8 1,551.6 million 1,326.6 1,414.4 1,505.7 1,601.4 1,701.9 1,806.5 % Growth 7.0% 6.6% 6.5% 6.4% 6.3% 6.1% 6.4% DATAMONITOR
Figure 17: United Kingdom fragrances market value forecast: $ million, 201015
Source: Datamonitor
DATAMONITOR

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MARKET FORECASTS
Market volume forecast

In 2015, the United Kingdom fragrances market is forecast to have a volume of 56.4 million units, an increase of 27.3% since 2010. The compound annual growth rate of the market in the period 201015 is predicted to be 4.9%. Table 15: Year 2010 2011 2012 2013 2014 2015 CAGR: 201015 Source: Datamonitor United Kingdom fragrances market volume forecast: million units, 201015 million units 44.3 46.7 49.1 51.5 53.9 56.4 % Growth 6.0% 5.4% 5.1% 4.9% 4.7% 4.6% 4.9% DATAMONITOR
Figure 18: United Kingdom fragrances market volume forecast: million units, 201015
Source: Datamonitor
DATAMONITOR

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MACROECONOMIC INDICATORS
Table 16: Year 2006 2007 2008 2009 2010 Source: Datamonitor United Kingdom size of population (million), 200610 Population (million) 60.6 61.0 61.4 61.8 62.1 % Growth 0.6% 0.7% 0.7% 0.6% 0.6% DATAMONITOR
Table 17: Year 2006 2007 2008 2009 2010
United Kingdom gdp (constant 2000 prices, $ billion), 200610 Constant 2000 Prices, $ billion 1,721.6 1,767.8 1,766.6 1,680.5 1,701.5 % Growth 2.8% 2.7% (0.1%) (4.9%) 1.3% DATAMONITOR
Source: Datamonitor
Table 18: Year 2006 2007 2008 2009 2010
United Kingdom gdp (current prices, $ billion), 200610 Current Prices, $ billion 2,433.6 2,831.1 2,714.4 2,227.1 2,302.6 % Growth 7.4% 16.3% (4.1%) (18.0%) 3.4% DATAMONITOR
Source: Datamonitor

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Table 19: Year 2006 2007 2008 2009 2010
United Kingdom inflation, 200610 Inflation Rate (%) 3.2% 4.3% 3.6% 2.2% 3.3% DATAMONITOR
Source: Datamonitor
Table 20: Year 2006 2007 2008 2009 2010
United Kingdom consumer price index (absolute), 200610 Consumer Price Index (2000 = 100) 116.3 121.3 125.7 128.4 132.7 DATAMONITOR
Source: Datamonitor
Table 21: Year 2006 2007 2008 2009 2010
United Kingdom exchange rate, 200610 Exchange rate ($/) 0.5435 0.4999 0.5449 0.6416 0.6475 Exchange rate (/) 0.6820 0.6840 0.7973 0.8921 0.8589 DATAMONITOR
Source: Datamonitor

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APPENDIX
APPENDIX
Methodology
Datamonitor Industry Profiles draw on extensive primary and secondary research, all aggregated, analyzed, cross-checked and presented in a consistent and accessible style. Review of in-house databases Created using 250,000+ industry interviews and consumer surveys and supported by analysis from industry experts using highly complex modeling & forecasting tools, Datamonitors in-house databases provide the foundation for all related industry profiles Preparatory research We also maintain extensive in-house databases of news, analyst commentary, company profiles and macroeconomic & demographic information, which enable our researchers to build an accurate market overview Definitions Market definitions are standardized to allow comparison from country to country. The parameters of each definition are carefully reviewed at the start of the research process to ensure they match the requirements of both the market and our clients Extensive secondary research activities ensure we are always fully up-to-date with the latest industry events and trends Datamonitor aggregates and analyzes a number of secondary information sources, including: National/Governmental statistics International data (official international sources) National and International trade associations Broker and analyst reports Company Annual Reports Business information libraries and databases
Modeling & forecasting tools Datamonitor has developed powerful tools that allow quantitative and qualitative data to be combined with related macroeconomic and demographic drivers to create market models and forecasts, which can then be refined according to specific competitive, regulatory and demand-related factors Continuous quality control ensures that our processes and profiles remain focused, accurate and up-to-date

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APPENDIX
Industry associations
British Fragrance Association PO Box 173 , Cranleigh Surrey GU6 8WU, United Kingdom Tel.: 44 1483 275 411
Related Datamonitor research

Industry profiles Fragrances in Europe Fragrances in Asia-Pacific Global Fragrances Fragrances in Spain Fragrances in Italy Fragrances in Germany Fragrances in France Fragrances in Russia Fragrances in Australia Fragrances in Singapore Fragrances in Japan Fragrances in India Fragrances in China Fragrances in Brazil Fragrances in United States Fragrances in Mexico Fragrances in Canada Fragrances in Portugal Fragrances in Ireland Fragrances in New Zealand Fragrances in Hong Kong

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APPENDIX
Fragrances in South Africa Fragrances in Switzerland

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APPENDIX
Disclaimer
All Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, Datamonitor plc. The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the findings, conclusions and recommendations that Datamonitor delivers will be based on information gathered in good faith from both primary and secondary sources, whose accuracy we are not always in a position to guarantee. As such Datamonitor can accept no liability whatever for actions taken based on any information that may subsequently prove to be incorrect.

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ABOUT DATAMONITOR
ABOUT DATAMONITOR
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Fragrances in the United Kingdom

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United Kingdom - Fragrances

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Market value forecast

Market volume forecast

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United Kingdom fragrances market value: $ million, 200610

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United Kingdom fragrances market volume: million units, 200610

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United Kingdom fragrances market segmentation I:% share, by value, 2010

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United Kingdom fragrances market segmentation II: % share, by value, 2010

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United Kingdom fragrances market share: % share, by value, 2010

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FIVE FORCES ANALYSIS

FIVE FORCES ANALYSIS

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