New York : A new trend led by Generation Z is reshaping the beauty industry as young shoppers show a growing love for perfumes. Major beauty companies like Coty and Estée Lauder are reporting strong fragrance sales, making perfumes one of the fastest-growing categories in the luxury market this year.

Industry reports show that households with Gen Z members made up nearly 38 percent of fragrance spending in the first half of 2025. This shift has helped perfume sales rise even as other beauty segments such as skincare and makeup slow down.

Estée Lauder’s fragrance business grew by about 14 percent in the quarter ending September, while Coty saw steady demand for popular brands such as Calvin Klein and Hugo Boss. Analysts describe this as a modern version of the “lipstick effect,” where consumers choose small indulgences like perfumes during uncertain economic times instead of big luxury purchases.

Globally, prestige fragrance sales reached around 3.9 billion dollars in the first half of the year, growing by six percent compared to the same period last year. In contrast, makeup grew by just one percent, and skincare sales fell slightly.

Coty is now planning to expand its fragrance portfolio further, even as it faces some challenges in the United States due to softer consumer spending and tariff issues. The company also announced plans to raise prices on some premium lines to protect profit margins.

Meanwhile, Estée Lauder is increasing its presence in global perfume markets, opening about 40 new standalone fragrance boutiques. The company is also using digital tools and social media platforms such as TikTok to reach younger customers.

The fragrance boom is not limited to big brands. Independent and niche perfume makers are also gaining popularity among young consumers who see scents as a way to express personality and mood. This trend, known as “smellmaxxing,” has been especially visible in markets like the United Kingdom and the Middle East.

Experts say the perfume surge reflects changing consumer habits, where younger buyers prefer affordable luxuries that feel personal and uplifting. With rising incomes and stronger middle-class spending in regions like India, China, and the Gulf countries, perfume makers see significant growth opportunities ahead.

For now, one thing is clear fragrances have become the new face of modern luxury, with Gen Z leading the way.