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CEW, NPD Trend Presentation Looks at Growth of Prestige Market in 2012

Posted: January 25, 2013

The NPD Group, Inc. presented a look at the U.S. and global beauty industry’s 2012 year-end results for skin care, makeup and fragrance at a “Hot off the Press” event at the Harmonie Club in New York last night. Cosmetic Executive Women Inc. (CEW) partnered to host this year’s event.

According to NPD, the total U.S. prestige beauty industry showed an increase of 7% in dollar sales in 2012 versus 2011. “Coming off the wave of 2011, one of the most robust sales periods in over a decade for the beauty industry, 2012 has shown some great highs, along with some modest lows,” said Karen Grant, vice president and senior global industry analyst, The NPD Group.

The market data and research company reported for prestige beauty growth by country in 2012 versus 2011, the U.S. was up 7%, the U.K. and Mexico both up 5%, while France dropped 1%, Italy dropped 4%, Spain dropped 7% and Argentina dropped 10%.

All of the U.S. prestige beauty categories posted healthy growth, however, as prestige skin care sold in U.S. department stores generated the largest growth at 10%, followed by makeup at 7%and fragrance at 5%, compared to 2011. “Even though consumer confidence continues to waver, there is momentum at both ends of the price and product spectrum,” said Grant. “In 2012, along with smaller categories in beauty, we are seeing investment spending on premium-priced makeup, skin care, fragrance, as well as premium-priced sets, which lead in growth once again. Even in Europe, where the economic environment is more challenging, the major premium-priced category, fragrance, was positive. Premium-priced products remain one of the brightest spots in beauty and will continue to carve out market share across all categories and geographies in the New Year.”

In addition, the U.S. food/drug/mass channel experienced nearly a 3% increase in sales for total beauty in 2012 versus 2011. Makeup sales posted the biggest increase at 5%, followed by skin care at 3%, while fragrance sales declined 4% in dollar sales, compared to 2011. In national chain stores, fragrance sales grew 7%.

“In the U.S., although we have seen some tempering in sales performance, compared to 2011, growth remains positive for both the prestige and mass channels. The trend of prestige beauty outpacing mass beauty continues to be evident since the recessionary period of 2009 and will likely continue into 2013,” ended Grant.