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Hair Care: A Push/Pull Market
By: Alexander Kirillov
Posted: May 1, 2008, from the May 2008 issue of GCI Magazine.
page 3 of 5Gender Gap
Men’s hair care is a segment that has, as of yet, been under-explored despite the expectations that it becomes better established in the longer term. Male-specific hair care sales accounted for less than 5% of the global hair care market in 2007, and it is also slower growing than other men’s grooming categories—including skin care and deodorants. The majority of men’s hair care products consist of male-focused colorants to hide gray hair. However, the men’s colorants segment is nearing maturity, and the real potential in this segment is in shampoo, conditioners and styling products.
Male-specific shampoo and conditioners have, for the most part, yet to meet with great success in markets outside of Japan. There is a needs-based question here. Unlike deodorants, where manufacturers have convinced men and women that they need separate products, a division has not been established in relation to shampoos and conditioners. Were manufacturers to push the notion that unisex shampoos are not appropriate for male hair, there could be scope for developing what could be a lucrative market niche.
Emerging Markets Drive Growth
Western Europe remains the largest hair care market globally, worth more than $14 billion in 2007 according to newly published Euromonitor International research. However, in terms of per capita spend, the region lags behind North America, and the key difference between the regions is spending on salon hair care. In North America, consumers buy almost four times more hair care products through salons as a result of efforts from major salon operators in the U.S. challenging the emergence of professional and pseudo professional brands in mass retail channels. However, the hair care market remains sluggish, growing below 2% annually on both sides of the Atlantic.
Asia Pacific shows much stronger growth, driven by a double-digit expansion in India and healthy growth in China, Indonesia and Vietnam. Japan, however, the biggest market for hair care in the region, had disappointing results—growing by a fraction of a percent in 2007.
Shampoo is the fastest-growing sector in the overall region, driven by strong penetration rates in emerging markets. The market has been expanding by 10% in dollar terms at a fixed exchange rate historically, and is set to remain the main force behind sector growth in the next five years, according to Euromonitor’s forecast.