Water is a great solvent. It’s neutral and doesn’t provide any strong positive or negative effects. It just helps components to mix better and to transport active components.
Fragrance is a mix of chemical ingredients (usually 20-30 chemicals but up to 200 sometimes) that help the product to smell better. It can hide many bad things. Synthetic fragrances may contain many different chemicals, but manufacturers don’t want to reveal each of them for some reason and hide them behind the word "Fragrance".
Chemical fragrances can lead to irritation or cause allergic reactions. Fortunately, the fragrance is usually located at the bottom of the list meaning its concentration is low. If you see it at the top, it’s a bad sign… It's a good idea to test the product first in this case.
Caffeine stimulates all the processes inside skin cells. It's very effective for reducing swelling on the face (especially great for under the eyes area). The effectiveness depends on the concentration, the more component you apply the better the effect will be.
It also tones up the skin making it look younger. It's great for dry skin because it stimulates the synthesis of cholesterol, a chemical that helps to form a protective layer on the surface of the epidermis.