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Executive Summary

IFRA’s new chairman Hans Holger Gliewe says one possible positive outcome of the COVID-19 pandemic could be that consumers go on putting a premium on scientific expertise after months of reliance on health experts’ advice. The public’s changed perspective could help drive science-based regulatory decision making, a caused long championed by the fragrance and beauty product industries.

 

As the fragrance sector looks toward a future beyond COVID-19, International Fragrance Association chairman Hans Holger Gliewe believes the industry will benefit not only from increased consumer interest in hygiene and cleaning products, but also from new appreciation for scientific expertise.

Gliewe suggests that consumers around the globe currently heeding the advice of health experts will emerge from the crisis more receptive to scientific views from those most qualified to provide them.

“As an industry whose work is based on scientific knowledge, a revival of reason is a good thing,” the exec remarks in a recent blog post. “We will work to ensure that science is at the heart of policy-making and public debate.”

The personal care and fragrance industries have long advocated for robust, risk-based science to inform decision making related to ingredient and product safety, which they believe is too often driven by politics and weak scientific evidence, including hazard signals with dubious relevance to real-world product use and human health.

Gliewe also expects that sustainability – environmental, social and economic – will gain even greater importance coming out of the pandemic, and this will represent opportunities for the fragrance industry.

He notes a new sustainability initiative that IFRA is undertaking with the International Organization of the Flavor Industry. “It is a project that has been years in the making, but whose time has truly come. It will be an important opportunity to highlight our sectors’ commitment to greener sourcing and production, to employee well-being, and to economic sustainability,” Gliewe says.

The groups state on their joint website, “For our industries, sustainability represents a new imperative. Through this voluntary initiative, the flavor and fragrance industries seek to encourage enhancements in the field of sustainability by offering advice, sharing best practice and measuring improvement.”

Gliewe is chief sustainability officer at Symrise AG. He assumed the two-year IFRA chairmanship on 1 April.

 

Economic Shock ‘Will Be Large And Will Hurt’

Overall, Gliewe’s blog post offers a sober assessment of the challenges facing the fragrance sector.

While the industry is leaning into work that earned it the “essential” designation needed to continue operating during the global shutdown – providing key ingredients for hand sanitizers, soaps and domestic cleaning products that please the senses and thereby encourage consumer use – other segments are declining fast.

According to Gliewe, fine fragrance sales have been “badly affected” due to store closures and the collapse of air travel (and airport store shopping).

Morever, consumers are interacting less, focusing more squarely on their health while sheltering indoors, and feeling increasing financial pressure, factors that do not translate readily to sales of luxury items such as perfumes.

There is no sugarcoating the grim realities of the pandemic. “The economic shock from coronavirus will be large and will hurt,” Gliewe says. “The key is to ensure that we recover as quickly as possible and in a way that turns this crisis into an opportunity for all.”

In late March, consulting and market research firm Kline & Company projected that, in the worst case – which it said was growing increasingly likely – the US cosmetics and personal-care market could decline by more than 8% in 2020. (Also see "2020 US Beauty May Be Headed For Record Declines, But There Are COVID-19 Opportunities" - HBW Insight, 6 Apr, 2020.)

More recent projections are more harrowing. Management consulting firm McKinsey states in a 5 May article, “Based on the scenarios most expected by global executives and current trends, we estimate global beauty-industry revenues could fall 20% to 30% in 2020. In the United States, if there is a COVID-19 recurrence later in the year, the decline could be as much as 35%.”

Fragrance firm Inter Parfums, Inc.’s fiscal 2020 first-quarter sales fell 18.7%, reported, to $144.8m, according to its 11 May release.

The company’s chairman and CEO Jean Madar highlights the exceptional growth performances of two Inter Parfums brands, Coach and GUESS. Otherwise, “comparable quarter sales declined for our other major brands following the closure of virtually all points of sale throughout the world by the middle of March due to the global COVID-19 pandemic,” he says in the announcement.

IFRA has postponed its annual Global Fragrance Summit until a yet-unannounced date in the first half of 2021. The 2020 event previously was slated to take place in April in Singapore.

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