NEW YORK — As the U.S. beauty industry braces for what’s expected to be a disappointing finish to the holiday selling season, NPD BeautyTrends is projecting that the overall prestige fragrance business will suffer a 3 percent decline for the year.

This story first appeared in the December 13, 2002 issue of WWD.  Subscribe Today.

Following a 2 percent decline last year, 2002 is expected to be the second year prestige fragrance sales have dropped since NPD began tracking the business in the mid-Nineties, according to the firm. Within a 3 percent decline projected for this year, men’s is seen as the bright spot. Although it won’t top $1 billion as a category in 2002, men’s is expected to rise 2 percent for the year, while women’s is expected to drop 5 percent, according to Timra Carlson, vice president of NPD BeautyTrends, who spoke at a Fragrance Foundation think tank Wednesday morning.

In a subsequent release issued Thursday, NPD stated that men’s could rise as much as 3 to 4 percent, while sticking to the earlier estimate that women’s will decline 5 percent for an overall decline of 2 to 3 percent.

Through October, the total fragrance category was running 4 percent behind for the year, with women’s scents down 6 percent and men’s flat. In determining yearend numbers, NPD considered the late Thanksgiving this year, which pushed November’s traditional sales spike into December. Next week is expected to generate half of the fragrance sales during the month of December, according to NPD.

Meanwhile, the fragrance industry’s best friend — that old dogma, “newness sells” — has grown less reliable in recent years. New launches represented 14 percent of the business in 1996. That share has since eroded. This year, newness is expected to account for 9 percent of the business.

“It has consistently been below 10 percent,” said Carlson. Although “new brands will continue to drive sales in the new year,” a “balance” must be struck between new and existing businesses, continued Carlson, who also stressed that value and quality are major factors influencing consumers.

Some top retailers have noted that existing fragrance brands are running 20 to 25 percent behind — both men’s and women’s — while gift sets continue on target.

Anti-aging products led the way in skin care, with a 6 percent increase in sales through October. Lip gloss was the fastest-growing color segment, according to NPD data, with a 33 percent jump through October.