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Putting the Color in Cosmetics Sales

By: Diana Dodson
Posted: March 5, 2008, from the March 2008 issue of GCI Magazine.

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Finding New Target Markets
Reaching out to new consumer groups is a priority for many cosmetics companies, and the color cosmetics category is becoming increasingly segmented. One of the most recent areas for innovation is within the ethnic niche. In the U.S., the largest market for color cosmetics, Hispanics, African-Americans and Asians account for approximately one-third of the population, and their numbers are growing at more than twice the rate of the population as a whole. It is, therefore, no surprise that they are becoming a target for new color cosmetics launches. In 2006, Procter & Gamble’s CoverGirl launched its Queen Collection in the U.S. in partnership with singer/actress Queen Latifah. Prescriptives now offers Colorprint to suit ethnic skin tones, and MAC has used Missy Elliot, Mary J Blige and Lil’ Kim as spokesmodels.

Men have become a more unlikely target. In January 2007, three years after Jean-Paul Gaultier made the first steps into men’s makeup, Swedish clothing chain H&M launched a mascara for men. There is also an array of niche brands, notably KenMen. While it is unlikely that the men’s segment will find widespread appeal, segmentation by age holds more promise. Bratz mascara and the marykateandashley makeup line are just two examples of brands trying to capture some of the estimated $250 million teen consumers spend globally on consumer products each year. With an approximate buying power of $2.1 trillion in the U.S. alone, baby boomers are an even more tempting draw for cosmetics brands. However, the dramatic failure of Revlon’s Vital Radiance, aimed at women over 50, suggests that this consumer segment can be a difficult market to tap into.

Delivering on Innovation
Faster or improved application is a growing priority for women, and is the main thrust behind the extensive innovation in mascara brushes in recent years. More recently, it has filtered into the nail products sector with the launch of improved brushes to make applying nail polish faster and more accurate. Maybelline’s newest line extension, Express Finish 60 Second Nail Color, uses an exclusive control-flow brush—which is said to dispense the optimal amount of color for smooth, even application that resists chipping and peeling. The recent global launch of Bourjois 1 Seconde boasts a patented fan-effect brush that adapts to the size of each nail to provide one stroke application.

Sampling and single-use packs are also a growing trend in color cosmetics, providing convenience, portability and a low-cost way to experiment with new color combinations. Canadian makeup firm Cargo leads the way in this trend, offering products such as single-use eye shadow ColorCards and DailyGloss lip colors packaged in individual tear-away pouches.

Niche Brands Challenge Leading Labels
Preliminary Euromonitor International data suggest color cosmetics will grow by a modest 2% per year during 2007–2012 to reach $41.1 billion. However, global market leaders such as L’Oréal, The Estée Lauder Companies, Procter & Gamble and Avon will have to increasingly share the gains with far smaller specialist players. With innovation so central to color cosmetics, the category is increasingly being penetrated by niche brands that offer eye-catching new approaches to tempt consumers away from the big name labels. Kiss My Face (which offers natural cosmetics), Duwop (with functional products including lip plumping Lip Venom), Taxi (with its portable cosmetics range) and ModelCo (a makeup artist brand) are just some of the labels that are taking a growing portion of cosmetics shelf space.