The rise of the Saudi perfume market

The rise of the Saudi perfume market
The rise of locally produced Saudi perfumes poses an opportunity for investors no longer restricted to international brands. (Shutterstock)
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Updated 01 October 2024
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The rise of the Saudi perfume market

The rise of the Saudi perfume market
  • Sector mirrors the Kingdom’s opulent lifestyle and its people’s historical connection to scents

RIYADH: Saudi Arabia, with its rich cultural heritage and burgeoning economy, presents a complex study of contrasts and traditions, particularly in its luxury perfume market.

This sector, deeply ingrained in Saudi society, mirrors the Kingdom’s opulent lifestyle and its people’s historical connection to scents.

With the market’s valuation at $1.8 billion in 2023 and anticipated growth to $2.6 billion by 2032, the Kingdom’s perfume industry is a testament to the cultural significance of fragrance. 

According to data from the Ministry of Commerce, exports amounted to SR416 million ($110.9 million) for 10 months of 2023, compared to imports, mostly from European countries, amounting to SR1.1 billion during the same period.

The rise of locally produced Saudi perfumes poses an opportunity for investors no longer restricted to international brands.

The number of commercial registrations granted to practice the manufacturing and bottling of perfumes in Saudi Arabia further demonstrates the rising tendency of citizens to invest in the industry.

According to data from the ministry, the number of existing commercial records for perfume manufacturing activity in the Kingdom reached 1,263 by the end of 2023.

Moreover, the push for female empowerment and increased tourism are expected to buoy the market further, making it an appealing sector for investors and entrepreneurs.

An inclination toward luxury and tradition

In the heart of Saudi Arabia’s scent market lies a preference for luxury and tradition. Premium products dominate the scene, reflecting a societal penchant for high-quality ingredients and prestigious brand associations. 

Chandra Mohan, the assistant vice president at research firm P&S Intelligence, told Arab News that the demand for premium fragrances is increasing due to rising personal disposable income and surging consumer awareness about the benefits of using extravagant perfumes.

Data gathered by his firm revealed that the luxury category held the larger share of the Kingdom’s scent market in 2022, accounting for almost the entirety of the sector at 90.9 percent. 




With their complex profiles and traditional ingredients, Arabic perfumes command a significant market share. (Shutterstock)

“Premium perfumes are made up of high-quality ingredients, which differentiate them from other cheap products. These are also concentrated and long-lasting and are designed to evolve and offer more sophisticated and refined experience,” Mohan explained.

“Nowadays, people are also becoming more conscious about brands and shifting toward quality and premium products, as they have high spending power. Thus, the growing usage of premium products is contributing to the growth of the market in the country,” he added.

The inherent quality and luxury of the Saudi perfume market, driven by the cultural significance of scents such as oud and musk, have contributed to the industry’s success.

With their complex profiles and traditional ingredients, Arabic perfumes command a significant market share. 

Their popularity is a nod to the region’s cultural heritage, where these fragrances are more than just scents: They are a bridge to the past and a celebration of Arab identity.

Demonstrating this, oriental perfumes accounted for the largest revenue share of the Saudi perfume market, accounting for 65.77 percent in 2022, according to a report by P&S Intelligence. 

The report further noted that this category is expected to grow by 6 percent from 2023 to 2030. 

FASTFACTS

• With the market’s valuation at $1.8 billion in 2023 and anticipated growth to $2.6 billion by 2032, the Kingdom’s perfume industry is a testament to the cultural significance of fragrance.

• The number of commercial registrations granted to practice the manufacturing and bottling of perfumes in Saudi Arabia further demonstrates the rising tendency of citizens to invest in the industry.

The craftsmanship behind these fragrances, often passed down through generations, adds layers of depth and sophistication, making them highly sought after locally and internationally.

The inclination toward premium fragrances connects back to deep-rooted cultural practices where perfumes served as an extension of personal identity and social standing, the owner of Saudi perfume brand “Nabdh,” Zaynah Al-Hamza, told Arab News. 

The digital age and celebrity branding

The digital landscape has transformed how perfumes are marketed and sold in Saudi Arabia. 

E-commerce, bolstered by the pandemic, has become a critical channel for reaching consumers, with many brands expanding their online presence.

“In recent times, developments in information and communication technologies, particularly social media, have revolutionized the way marketing activities take place. Social media has surfaced as a cost-effective and efficient information exchange platform for all,” Mohan said.

“Celebrities are also promoting several brands on social media and people are increasingly buying those products because of celebrity influence,” he added.

In March 2023, Portuguese influencer Georgina Rodriguez starred in social media adverts for Saudi fragrance brand Laverne, which later collaborated with global supermodel Taylor Hill. 




The push for female empowerment and increased tourism are expected to buoy the market further. (Supplied)

Perfume companies partner with celebrities to increase brand awareness and drive website traffic and sales, the P&S global report said, adding that this tactic also aids in generating engagement, creating a community, and serving as a channel for customers.

This shift has made the Saudi luxury perfume market more accessible and has opened up new avenues for brands to engage with their audience through social media and online marketing.

The interplay between tradition and modernity and embracing digital methods sets the stage for a dynamic future in the Saudi fragrance industry.

The unisex phenomenon

Unisex fragrances, capturing the largest market share, indicate a progressive shift in consumer behavior. This trend underscores a growing acceptance of products that transcend traditional boundaries, with scents like oud, musk, and amber being used for scents that appeal to all customers. 

“Another key trend observed in the market is the rising demand for unisex perfumes. This is because people have different tastes and a large number of individuals are looking for an aroma that is not only feminine but also masculine,” the P&S analyst said. 

“Moreover, anyone can wear them, and it allows sharing and swapping collections among different genders. Furthermore, unisex perfumes are neutral in odor and millennial consumers are mostly choosing products with inimitable fragrances in order to build up their personality and individuality,” he added.

These preferences highlight the changing landscape of the Saudi market, which, despite its traditional foundations, is receptive to modern influences.


Chief economists expect global economic conditions to weaken in 2025

Chief economists expect global economic conditions to weaken in 2025
Updated 16 January 2025
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Chief economists expect global economic conditions to weaken in 2025

Chief economists expect global economic conditions to weaken in 2025

DUBAI: More than half of chief economists expect economic conditions to weaken in 2025, according to a World Economic Forum report released on Thursday.

“The growth outlook is at its weakest in decades and political developments both domestically and internationally highlight how contested economic policy has become,” said Aengus Collins, head of Economic Growth and Transformation at the WEF.

The outlook is more positive in the US, with 44 percent of chief economists predicting strong growth in 2025, up from 15 percent last year. However, 97 of respondents in the “Chief Economists Outlook” report said they expected public debt levels to rise, while 94 percent forecast higher inflation.

Europe, on the other hand, remains the weakest region for the third consecutive year, with 74 percent of economists expecting weak or very weak growth.

In the Middle East and North Africa region, 64 percent expect moderate growth while a quarter expect weak growth.

Collins said the global economy was under “considerable strain,” worsened by increasing pressure on integration between economies.

A total of 94 percent of economists predict further fragmentation of goods trade over the next three years, while 59 percent expect the same for services trade. More than 75 percent foresee higher barriers to labor mobility and almost two-thirds expect rising constraints on technology and data transfers.

The report suggests that political developments, supply chain challenges and security concerns are critical factors that will likely drive up costs for both businesses and consumers over the next three years.

Businesses are expected to respond by restructuring supply chains (91 percent), regionalizing operations (90 percent), focusing on core markets (79 percent) or exiting high-risk markets (76 percent).

When the economists were asked about the factors contributing to current levels of fragmentation, more than 90 percent pointed to geopolitical rivalries.

This is largely due to the “strategic rivalry” between the US and China, according to the report, along with other geopolitical disturbances, particularly in Ukraine and the Middle East.

Global fragmentation is likely to result in a more strained global landscape with chief economists expecting an increase in the risk of conflict (88 percent), a more bipolar system (79 percent) and a widening divide between the Global North and South (64 percent).

“In this environment, fostering a spirit of collaboration will require more commitment and creativity than ever,” Collins said.


Australian-Saudi Business Council hosts joint forum to help boost trade

Australian-Saudi Business Council hosts joint forum to help boost trade
Updated 16 January 2025
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Australian-Saudi Business Council hosts joint forum to help boost trade

Australian-Saudi Business Council hosts joint forum to help boost trade
  • Event brought together more than 35 participants from both nations to discuss key opportunities for trade and investment

RIYADH: The Australian-Saudi Business Council hosted a joint forum on Thursday to discuss the enhancement of collaboration and trade between the two countries.

Led by Daniel Jamsheedi, the council’s country director, the event brought together more than 35 participants from both nations to discuss key opportunities for trade and investment.

The event, a collaboration with the Federation of Saudi Chambers, aimed to build on the success of the first Australian Pavilion at the Future Minerals Forum in Riyadh this week, and further strengthen the economic partnership between the two countries, organizers said.

Sam Jamsheedi, the president of the council, thanked the federation for the vital role it played in the success of the forum.

“The Federation of Saudi Chambers is one of our key stakeholders and our partner within the Kingdom,” he said.

“As a business council, we appreciate the efforts put in to enable this joint business forum to succeed.”


Closing Bell: Saudi main index rises to close at 12,256 

Closing Bell: Saudi main index rises to close at 12,256 
Updated 16 January 2025
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Closing Bell: Saudi main index rises to close at 12,256 

Closing Bell: Saudi main index rises to close at 12,256 

RIYADH: Saudi Arabia’s Tadawul All Share Index rose on Thursday, gaining 43.82 points, or 0.36 percent, to close at 12,256.06. 

The total trading turnover of the benchmark index was SR6.14 billion ($1.63 billion), with 104 stocks advancing and 129 retreating. 

Similarly, the Kingdom’s parallel market Nomu gained 198.90 points, or 0.64 percent, to close at 31,498.71, as 51 of the listed stocks advanced and 37 retreated. 

The MSCI Tadawul Index also rose, gaining 9.13 points, or 0.60 percent, to close at 1,535.78.

The best-performing stock of the day was Shatirah House Restaurant Co., which debuted on the main market. Its share price surged 5.31 percent to SR22.62. 

Other top performers included Fourth Milling Co., with its share price rising 4.49 percent to SR4.19, and Saudi Paper Manufacturing Co., whose share price surged 3.36 percent to SR67.70. 

Riyadh Cables Group Co. recorded the biggest drop, falling 2.88 percent to SR141.80. 

National Co. for Learning and Education also saw its stock price fall 2.73 percent to SR185.40. 

Buruj Cooperative Insurance Co. also saw a drop in its stock price, falling 2.63 percent to SR22.22. 

On the announcements front, the Arab National Bank has launched the offer of its SR-denominated additional tier 1 capital sukuk under its sukuk program.  

According to a Tadawul statement, the amount, terms, and return on the sukuk will be determined later based on market conditions. The minimum subscription and par value are set at SR1 million. 

The targeted investors are institutional and qualified clients in line with the Capital Market Authority’s regulations. HSBC Saudi Arabia and ANB Capital Co. are joint lead managers for the sukuk issuance. 

Arab National Bank ended the session at SR21.10, with no change in price. 

Tam Development Co. received a purchase order for a project worth SR29.45 million as part of a framework agreement with a government agency announced in March, with a total value of SR200 million. 

Tam Development Co. ended the session at SR200, up 3.45 percent. 

Saudi Real Estate Co. secured Shariah-compliant banking facilities from Bank Al-Jazira worth SR700 million. The facilities will finance ongoing and new projects, as well as expansion investments. 

Part of the financing, up to SR100 million, will support working capital requirements. The loans have a one-year short-term tenure and a maximum of ten years for long-term loans, with promissory notes and real estate mortgages as guarantees. 

Saudi Real Estate Co. ended the session at SR27.30, down 2.01 percent. 


Saudi Ma’aden awards $921m contracts for its 3rd phosphate fertilizer plant

Saudi Ma’aden awards $921m contracts for its 3rd phosphate fertilizer plant
Updated 16 January 2025
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Saudi Ma’aden awards $921m contracts for its 3rd phosphate fertilizer plant

Saudi Ma’aden awards $921m contracts for its 3rd phosphate fertilizer plant
  • Project designed to add 3 million metric tonnes annually to Kingdom’s phosphate production capacity
  • Contracts align with Saudi Arabia’s broader strategy to diversify its economy and expand its industrial base

JEDDAH: Saudi Arabian Mining Co. has awarded three contracts worth SR3.45 billion ($921.58 million) for its third phosphate fertilizer plant, reinforcing the Kingdom’s position in the global market.

In a filing with the Tadawul stock exchange, the national mining firm, also known as Ma’aden, named the contractors as China National Chemical Engineering Co., Sinopec Nanjing Engineering and Construction, and Turkiye-based Tekfen Construction and Installation Co.

First announced in 2016, the project is designed to add 3 million metric tonnes annually to Saudi Arabia’s phosphate production capacity. Estimated to cost SR24 billion, the facility is being developed in phases and was initially projected to reach full capacity by 2024, the company said at that time.

The contracts align with Saudi Arabia’s broader strategy to diversify its economy and expand its industrial base. As part of Vision 2030, the Kingdom is capitalizing on its vast reserves of phosphate, gold, copper, and bauxite to reduce its reliance on oil.

Valued at approximately $2.5 trillion, the Saudi mining sector is regarded as the fastest-growing globally and is positioned as the third pillar of its industrial economy.

The three contracts awarded include an SR1.22 billion agreement for general construction at Ras Al-Khair with China National Chemical Engineering. A second contract, worth SR1.36 billion, was awarded to Sinopec’s subsidiary for construction at Wa’ad Al-Shamal. Tekfen Construction secured the third contract at SR877 million, with work at Wa’ad Al-Shamal included.

The development aligns with Ma’aden’s 2016 announcement of a feasibility study for a world-class phosphate fertilizer production complex in Wa’ad Al-Shamal Minerals Industrial City, situated in Saudi Arabia’s Northern Province.

Ma’aden announced significant discoveries of gold and copper in the Arabian Shield region during the Future Minerals Forum 2025 in Riyadh, further advancing its mining ambitions.

The discoveries include extensive gold deposits at Wadi Al-Jaww and copper reserves at Jabal Shayban. Mineralization at these sites extends from shallow depths of 20 meters to depths of up to 200 meters, highlighting their potential for large-scale extraction, the company added.

Ma’aden also unveiled promising developments at its Mansourah-Massarah gold mine, where drilling has revealed high-grade gold mineralization beyond the current pit design. 

The financial impact of these discoveries is yet to be determined, Ma’aden said in a statement to the stock exchange.


MENA economic growth to accelerate to 2.9% in 2025, says Moody’s

MENA economic growth to accelerate to 2.9% in 2025, says Moody’s
Updated 16 January 2025
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MENA economic growth to accelerate to 2.9% in 2025, says Moody’s

MENA economic growth to accelerate to 2.9% in 2025, says Moody’s

RIYADH: Oil production and large investment projects will accelerate annual economic growth across the Middle East and North Africa by 0.8 percentage points in 2025, according to Moody’s.

The global credit rating agency forecasts growth of 2.9 percent this year, up from 2.1 percent in 2024, and also  maintained a stable outlook for the credit fundamentals of sovereigns in the region over the next 12 months.

The agency emphasized that the impact of large investments will be most evident in Saudi Arabia, driven by high government and sovereign wealth fund spending linked to the Vision 2030 diversification program.

The projections align with those of global consultancy Oxford Economics, which expects regional gross domestic product to grow by 3.6 percent in 2025, outpacing the firm’s global forecast of 2.8 percent. 

Moody’s added that the pickup in the MENA economy will be driven primarily by “stronger growth in the region’s hydrocarbon exporters because of a partial unwinding of strategic oil production cuts under the OPEC+ agreement.”

Alexander Perjessy, vice president and senior credit officer at Moody’s, said: “Large-scale investment projects, many of them part of longer-term government development and diversification agendas, will support non-hydrocarbon economic activity across the region.”

According to the credit rating agency, real gross domestic product growth for hydrocarbon-exporting nations is expected to rise to 3.5 percent in 2025, up from 1.9 percent in the previous year, as Saudi Arabia, the UAE, Iraq, Kuwait, and Oman ease the oil production cuts implemented in 2023.

In Qatar, growth in the small, gas-rich nation will be bolstered by the development of the petrochemical industry and construction activities related to the expansion of liquefied natural gas production capacity, set to come online between 2026 and 2030.

In Kuwait, non-hydrocarbon growth will be mainly driven by major projects, including the construction of a new port and a new airport terminal.

Meanwhile, Iraq’s non-hydrocarbon growth is expected to remain above pre-COVID levels, provided that improved domestic security conditions are sustained, driven by the gradual implementation of several transport and energy projects.

In the UAE, non-hydrocarbon growth will moderate slightly due to the completion of some infrastructure projects; however, it will remain robust, at around 5 percent in 2025.