The U.S. beauty industry appears on track for growth in 2024, building on strong 2023 momentum.
According to Circana dataa, U.S. prestige beauty industry dollar sales grew by 14%, year over year, to reach $31.7 billion in 2023, while mass market beauty sales experienced a year-over-year dollar increase of 6%.
These results dwarfed other consumer product categories tracked by the firm; beauty truly stands alone.
But the firm has warned that economic concerns remain, whether due to inflation, supply chain issues related to the conflicts in the Middle East or other macro concerns.
To understand where the growth opportunities for 2024 lie, it's important to review what the 2023 data tells us.
- Hybrid color is a winning strategy. In 2023, top growers in the prestige makeup category included lip makeup, which spiked 31% year-over-year, or twice the rate of the overall category. This was led by products such as tinted lip oils and balms, which offer benefits beyond pigment. This skin-friendly positioning meshes neatly with a 2022 Mintel survey cited by Vantage, which showed nearly 70% of U.S. female makeup users want multifunctional productsb.
- Body care & Gen Alpha are driving skin care growth. Not only was the category the fastest-growing segment in prestige beauty based on units sold, per Circana, skin care was also one of only two mass sectors that grew based on unit sales. Top performers included lotions, creams and cleansers for the body, signaling an upswing in the category. Also of note, however, was a rise of teen and tween engagement in skin care, as evidenced by a growing market share among 45-54-year-olds with a household size of four that included children under 18 years old.
- Fragrance is all about value. The key growth sectors in prestige fragrance included high-concentration fragrances, which gained three share points in 2023, as well as mini versions of women's scents, grew at five times the rate of other sizes. Also on the upswing were mini/travel sizes and body sprays, as well as gift sets.
- Don't sleep on styling. Hair styling was the fastest grower in the prestige hair category in 2023, with dollar sales up 24%, driven by a more than doubling of hair launch volume compared to 2022. The sector is benefiting in part from the broader skinification impacting the hair and scalp category.
As we've learned in recent years, anything can happen. But consumer and market data continues to point to a strong environment for beauty amid an increasingly crowded and competitive field. The winners will focus be those that are best able to act on what consumers are telling us.
awww.circana.com/intelligence/category/blog/?_industry=beauty
bwww.gcimagazine.com/brands-products/color-cosmetics/article/22877755/color-cosmetics-skinforward-revolution
