BW Confidential - Issue #13 - March/April 2013 - (Page 58)

Market watch: US Country overview Mixing it up The US beauty market is likely to see slower growth in 2013, although higher-priced prestige products are set to continue to outpace the mass category by Alex Wynne T he US beauty market saw a mixed picture in 2012, with growth in prestige outpacing that of mass as high-end consumers increased their spending, while others, pinched by rising costs, traded down to lower-priced alternatives. The prestige market grew by 7% in 2012 compared with 3% for mass, according to market-research group NPD. “[In 2012], prestige beauty outpaced mass, sometimes at two or three times the rate of growth in the mass market,” NPD vice president and global beauty industry analyst Karen Grant reveals. “Within prestige, premium-priced make-up, fragrance and skincare, the products that are at least double the average price is where we are seeing the fastest growth.” But while the market was buoyant in the first six months of 2012, growth slowed in the second half, leading market players to show reserve on how business will pan out in 2013. Research firm Euromonitor International is predicting overall growth of 2.6% for the US beauty and personal-care market this year, 58 compared with a 3.2% increase in 2012. It anticipates slower growth in all of the main product segments, from 3.8% in make-up “ We expect [the prestige market in 2013] to be positive, but less robust, given how much momentum we’ve already had ” NPD vice president and global beauty industry analyst Karen Grant (compared with a 5% increase in 2012) to 1.9% in haircare (which saw sales up 2.7% last year). For the prestige market, meanwhile, growth is also expected to slow to 5% compared with 8% in 2012, according to NPD’s Grant. “We expect [the prestige market in 2013] to be positive, but less robust, given how much momentum we’ve already had,” she comments. “This is a time when we’re going through a lot of change and we’re embarking on some new frontiers. New types of brands are coming to the fore and becoming more important than we’ve seen in the past. It’s an interesting time for beauty, and there’s going to be a lot of newness and a lot of surprises to come.” Newness drives growth Much of the growth seen in the market has been driven by newness over the past year, notably in skincare, which saw sales increase by 3.4% to $10.7 bn in 2012, according to Euromonitor. “There has been so much innovation in the past year; brands have come back from the recession with amazing innovations, and that is driving growth,” beauty retailer Blue Mercury founder and ceo Marla Beck says. “Skincare is the fastest-growing category, especially for products March-April 2013 - N°13 - BW Confidential

Table of Contents for the Digital Edition of BW Confidential - Issue #13 - March/April 2013

Cover
Comment
Contents
Update
- Brand & retail news recap
- Companies on the move
Take note Market facts, figures & trends
Best of BW Highlights from our e-publication
Launches The latest in fragrance, skincare & make-up
Interview Natura Cosméticos evp José Vicente Marino
Insight: Make-up
- Category overview
- The latest trends
- Social media
- Retail viewpoint
- Retail case studies
- Increasing usage
Retail
- European perfumeries
- Store concepts
Digital Mobile strategies and brand case studies
Strategy spotlight Trends to inspire
Market watch: US
- Country overview
- Department stores
- Specialty stores
- Industry viewpoint
Emerging markets Company profile: Jequiti
Radar A profile of six up-and-coming beauty brands
Travel retail: Brazilian travelers
- Overview
- Passenger profiles
Packaging Designs for travel retail
Last word The Beauty Company’s Alisa Marie Beyer on new ways to converse with consumers

BW Confidential - Issue #13 - March/April 2013