Euromonitor analyst Carrie Lennard noted some general trends in beauty, including a move to more budget and private label color cosmetics brands, a continued presence by minerals and naturals and strong performance within facial makeup, namely foundation and formulas with antiaging properties. With high-profile exits in 2009 — such as Max Factor withdrawing from the U.S. market — the decision by other players to enter the sector during such a difficult year remains questionable.
Premium fragrance vendors, such as the Estée Lauder Cos. Inc., are shifting toward smaller packs to keep prices down for money-strapped consumers. Celebrities will still fuel fragrance sales in 2010, said Lennard, and fragrance will also move even closer to masstige positioning and distribution.
Hair care “has been hit by the threat of private label, like in shampoo, which is more of a commodity,” Lennard noted, adding hair color has done well as consumers cut back on visits to the hairdresser. “Products such as Clairol Root Touch Up target those cutting back on the salon,” she said.
Department stores are taking a knock in sales as consumers move toward mass channels, such as supermarkets, drugstores and even discounters. “Even though we are seeing an improvement in the economy, people find it easy to trade down, but more difficult to trade back up,” Lennard said. This trend is being seen especially in the men’s category as “there has been a shift toward mass, even though men’s started in prestige. It has shifted down. Men’s skin care is also beginning to mimic women’s with tinted moisturizers.”
According to Euromonitor, a trend toward “cross-category ‘spread betting’ and increased brand diversity has emerged as a key strategy for many players in beauty and personal care as it is seen as being lower risk than putting all one’s eggs in one basket,” said a recent report by the data firm. “Even though the beauty industry is starting to show signs of recovery, 2010 should see more companies shifting their category focus. Euromonitor International predicts that the most popular choices for new category entry will be skin care and men’s grooming.”