U.S. sales in the cosmetics and toiletries market grew only by 0.3% in 2008, the lowest since 1991, according to the latest study completed by worldwide research and consulting firm Kline & Company. The new data available in Cosmetics & Toiletries USA 2008 indicates that sales have reached a total of $35.6 billion at the manufacturers’
Consumers are showing a preference for competitively-
“The new frugal mindset imposed by the recession has altered spending and product consumption habits, some of which will probably continue into the foreseeable future,” notes Nancy Mills, Industry Manager, Consumer Products practice, at Kline. “Many people have traded down on certain products, and as they get accustomed to buying some lower-priced or private-label products, and shop more in the lower-priced channels, they might well continue with those habits after the tough times have subsided. To be successful, companies will likely continue to infuse the mass segment with more sophisticated products to compete with luxury products.”
Skin care, the largest product class, was also the second-fastest growing category during 2008, spurred by the sun care category. Although consumers have curtailed spending, they are not ignoring innovative and sophisticated new products. Marketers propel growth with product development, albeit the rate of new launches slows down in 2008. Some brands that did very well in the previous years such as Bare Escentuals, had slower growth in 2008, whereas, some mass brands like Garnier skin care and Neutrogena sun care showed very strong growth. Some luxury brands did buck the trend with great results—such as La Prairie.
Kline projects a moderate growth over the next five years. Years 2009–10 will be sluggish, but the following three years are expected to witness growth. This growth will be affected negatively by stricter legislation on claims and ingredients and the new consumer mindset of cautiousness on spending. However, it will be impacted positively by product innovations and new alliances and mergers between companies.
Cosmetics & Toiletries USA 2008 is the authoritative source of information on the cosmetics and toiletries industry. It contains information on market size, retail sales, channel breakdowns, trends, as well as forecasts for 29 product categories, and detailed profiles of 26 leading marketers.
For more information, contact: Vera Sandarova, Marketing Communications
