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Detangling Hair Care

By: Carrie Lennard, Euromonitor International
Posted: February 2, 2010, from the February 2010 issue of GCI Magazine.

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Private label hair care is still in its infancy in emerging regions (in Asia-Pacific, for example, it accounted for less than 1% of total brand shares in 2008), although it is starting to develop as multinational retailers continue to expand and consumers learn to trust these store brands. In India, for example, many retailers have recently introduced tiered pricing in private label (long favored by retailers in the West) to cater to a wider audience. In the majority of emerging countries, branded hair products from multinationals are still perceived as being of far higher quality than local brands. This explains the phenomenal success of sachet marketing in emerging regions. Sales of brands such as L’Oréal’s Garnier have thrived in India thanks to sales of sachet products.

In developed regions such as Western Europe, private label is far more trusted among consumers. One of the main reasons for this is that the retail market is far more concentrated by chain stores. Companies such as Boots in the U.K. have spent a long time building trust among consumers of Boots-branded hair care ranges. This meant that as the recession hit, consumers felt far more comfortable switching to private label products associated with these kinds of retailers.

Colorants; At-home Perms Get Boost

It is not entirely doom and gloom for the retail hair care industry in developed markets. Colorants and at-home perm kit sales have been thriving. Visits to the hairdresser were one of the first things to be cut from the budget of many consumers, and salons have been forced to offer discounts to consumers in order to maintain foot traffic—a tactic that has not entirely prevented many women from choosing to color their hair at home. As a consequence, the colorants category, previously one of the less dynamic areas of hair care, according to Euromonitor (with a compound annual growth rate of under 1% from 2003–2008 in Western Europe), has transformed into a hive of new product development activity and renewed consumer interest. Many of the new launches center on products being marketed as salon alternatives or root touch-up between hairdresser visits. Sales of products such as Clairol’s Root Touch-up and Root Rehab by Kelly Van Gogh have increased among heavily indebted consumers in markets like the U.S.

Shift Toward Milder Colorants

The other major current trend in colorants currently is ammonia-free. L’Oréal launched ammonia-free hair colorant Inoa in Western Europe in September 2009.

Although no-ammonia colorants are nothing new, the product claims to achieve the same results as products that do contain the chemical. The range is professional; it will be sold for at-home use too in the future. One of the main reasons for the trend is more stringent regulations in Western Europe governing hair colorants, announced in October 2009. The new laws require hair colorants that contain oxidative ingredients to be labeled that they can cause severe allergic reactions. These risks scare some consumers and provide an incentive for manufacturers to reformulate their products in order to avoid having to print the warning on their packaging. This change in the law, coupled with the increased consumer demand, means that more innovation is likely to come in 2010.

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