As The Fragrance Shop unveils a strong rise in profits this week, Retail Week takes a sniff around the perfume market.

Why we talking about it now?

The Fragrance Shop reported a 9.2% rise in EBITDA to £12.4m for the 12 months to March 31. In an interview with Retail Week, the retailer revealed that it’s set its sights on the capital, with plans afoot to open sites in central London, including Oxford Street, and large shopping malls. The 160-store retailer plans to open 20 shops across the UK this year.

On the premium side, Estée Lauder-owned Jo Malone is gearing up to open its first out-of-town store in the Southeast, with a shop at Bluewater set to open in July.

How much is the market worth?

The market was valued at £1.42bn in 2012, the most recently available figures from Mintel. During 2015-18, it expects growth of 4.5% each year, thanks to increased interest from men and older consumers in fine fragrance.

Perfume is the second most popular choice for gifting at Christmas after clothing, with about half of adults buying fragrances, aftershave or toiletries as gifts, according to Mintel.

Who are the biggest players?

Boots accounts for 33p for every £1 spent on fragrances, thanks in part to the retailer’s popular loyalty scheme and regular offers on fragrances. The second most popular channel to purchase fragrances is at discount, drugstores and grocery stores, which also includes sellers like The Perfume Shop with 29p, followed by department stores with 22p. Online accounts for 8%.

“Online sales of fragrances are never likely to eclipse purchasing from brick-and-mortar stores, but they are likely to continue to see growth in coming years,” says Mintel senior beauty analyst Lucy Cornford said in a report on men’s and women’s fragrances.

In terms of brands, Coty, which operates brands such as Calvin Klein and Marc Jacobs, represents 16% of the market, followed by L’Oréal at 13% and Estée Lauder at 12%. Own brand accounts for 3% of the market and is unlikely to increase “as consumers invest more in the luxury image of prestige brands over retailer offerings”, says Cornford.

Which retailers are boosting their fragrance offer?

Last September, The Fragrance Shop launched its new perfume fascia, Indulge Fragrances, in Manchester’s Trafford Centre. The store allows customers to browse and select fragrances in an open space, which is designed to complement the Fragrance Shop’s offer, which typically keeps all products behind the till.

Selfridges launched a temporary Fragrance Lab in May, designed to draw shoppers into the world of perfume and collect valuable data. Customers answered questions based on their tastes and habits and were eventually presented with a 50ml bottle of their signature scent. The process cost £65.

In recent years, department stores such as Debenhams, John Lewis and Harvey Nichols have placed more emphasis on their beauty halls, which feature perfume counters alongside cosmetics. For instance, Debenhams’ £25m refurbishment project of its flagship store on London’s Oxford Street included an extended range of brands and services and a revamped fragrance hall.