Prices of premium fragrances are climbing—but so are sales.

Despite increased prices, consumers can’t seem to get enough of prestige cosmetics. According to The NPD Group, Inc., sales of premium priced prestige beauty products in the U.S. reached $2.2 billion in the 12 months ending November 2013, a 23% increase versus the same time period last year.

“The value of premium priced beauty products to a consumer can range from the quality of the ingredients and product performance, to something as simple as cost benefits that come with a larger format,” says Karen Grant, vice president and senior global industry analyst, The NPD Group, Inc.—and a member of Beauty Packaging’s Board of Advisors “Whatever the motivation, consumers continue to be more willing to invest in their beauty products.” (For Grant’s predictions for 2014, please see p. 66 in this issue.)

Over the past two years, the average price of prestige beauty products has increased consistently. Fragrance is the category with the highest average selling price, largest price increase, and most significant increase in unit sales of premium priced products.

“The willingness of today’s consumers to spend a little more on their beauty products is a continued opportunity for manufacturers and retailers. It is the right time for communicating the end benefit of investing in better products and service to get the attention of your customer, and delivering on those promises will do the rest,” says Grant.