In boardrooms across the country, marketers are asking the same question, “How can we compete and grow in this economic environment?” Turn on the television, open a newspaper or tune into your favorite radio station—it’s hard to not get depressed listening to all of the bad news about our ailing economy. Even with the promise of bailouts and the hope of stimulus packages to come, those in the beauty business are getting nervous—and with good reason.
Thankfully, there is one true constant that will keep you in business. Women (and a growing number of menfolk, too) can’t resist the need to look and feel their best despite the current gloom and doom of the economy. Vanity continues to grow even while wallets shrink.
To stay ahead, companies must be savvier than ever. “Out” are the days of wasteful, whimsical product development; “in” are the days of consumer-conscious marketing, research and development. Your consumer knows what she wants, and if you’re listening, you’ll stay ahead of the game.
During the last year, The Benchmarking Company (TBC) has collected data on, researched and identified 14 key beauty trends that wise and nimble cosmetic companies should incorporate into their future marketing plans for 2009 and beyond. These trends are not quick fixes, nor are they “beauty Ponzi schemes.” They are intended to help direct today’s companies gain larger market share, grow new areas of business and speak the same language as their consumers.
1. Natural, Scientific and Trendy Antiaging Ingredients
Time stands still for no one, and whether you decide to attack the aging process naturally or scientifically, women are fighting Father Time with all they’ve got. According to Euromonitor International, the worldwide market forecast for antiaging and nourishing products is accelerating upward, expected to reach $15.8 billion by 2010.
Those who choose the natural route are part of a growing movement of demanding choices that they deem better for their bodies and for the environment. While there still remain no real guidelines or definitions for many terms used in this segment, companies continue to develop products across all categories.
The antiaging category is the newest natural segment to gain real attention. Botanicals, specialty teas, herbal extracts as well as vitamins, antimicrobials, minerals and a sea of marine-based organisms have found their way into skin care and cosmetic products.
They promise revolutionary antiaging results using ingredients that have been available since the dawn of time. Successful brands will be those that work. Even the most dedicated environmentalist will pass up a natural antiaging product if she does not see real results.
And not since the U.S./Soviet space race have there been more scientists and R&D departments working harder. In the case of antiaging brands, companies are trying to find the perfect formulations that promise to reduce the appearance of wrinkles, fine lines and other general aging concerns. This will continue to be a trend, but developers beware—the products will have to be efficacious to be distinguishable among the countless antiaging products out on the market. This is non-negotiable—the products must work and cannot make unsubstantiated claims.
2. The End of the Shopping Stigma
No longer are department stores the primary destination for beauty product shopping. Beauty dollars are being spent across multiple outlets—including the Internet, TV home shopping channels and infomercials. Various factors contribute to this shift, including the ever important feature of convenience, but one important reason that cannot be ignored is that women demand to be educated about the products they are purchasing. These mediums have a private, captive audience. Now the consumer can hear directly from the founder, dermatologists and other professionals discussing the products, ingredients and benefits at length, turning passive audience members into buyers. These nontraditional retail outlets have certainly been legitimized and are here to stay.
3. Skin Care is Manly
Brands understand that men are also interested in turning back the hands of time and looking younger for longer. In fact, men’s prestige skin care growth during a period in 2006 outpaced women’s prestige skin care, which was flat at that time. The secret to increased sales in this marketplace is to target the women in men’s lives, as 40% of men’s skin care products are purchased by women. Men’s skin care promises to be a continued force in the beauty industry.
4. The ABCs of SPF
We have been inundated with warnings about the dangers of harmful sun exposure, and mass and prestige brands alike have aligned themselves to that fact. Through repetitive advertising and marketing, women now believe that safe, smart sun exposure is the only option. TBC’s recent study, “Survival of the Prettiest: Face and Body Skin Care Pink Report,” showed that more than a quarter of women use products with SPF, regardless of age. And of those, nearly half use SPF products at least once daily, and this is an evolution of the trend toward multifunctional products. For example, she doesn’t simply want a facial moisturizer, body lotion or self-tanner; she demands that her products also contain a minimum SPF 30, as well as equal protection from UVA and UVB rays. Opportunities exist in this category, especially for those brands offering natural formulations coupled with sun protection.
5. Sunless Tanners on a Rainy Day, or Every Day
That sun-touched glow from the beach is still desirable. But how do we reconcile that desire with legitimate fears of skin cancer, premature aging as a result of UVA and general dryness? Welcome to the ever-growing instant and self-tanning category, where multifunctionality is also the name of the game. Sunless tanning products that serve multiple purposes and provide body benefits will be those that sustain and grow. Look for sunless tanning products that incorporate SPF, tan extender agents, natural ingredients and antioxidants, and antistreaking properties—all while doubling as a moisturizer. With the growth of self-tanners, salons will ramp up services to compete. Look for salons to update their professional tanning delivery systems by adding more services such as “portable spray-on” applications where the salon pro comes directly to you.
6. Inside Out Beauty With Pretty Potions
Drink and eat your way to a more beautiful you? This is what companies such as Borba, Glowelle and Murad are touting with their newly offered product ranges of ingestible nutricosmetics. Each brand promises various benefits by delivering valuable nutrients directly to the body to effectively combat specific skin issues. Datamonitor projects that ingestible nutricosmetics will be a $1.3 billion business by 2012—possibly the hottest-growing segment the beauty industry will see in the next few years. Prestige brands, as well as mass brands such as Olay, have already launched lines. Companies will be challenged with building credibility in this arena; consumers will have to establish trust in product efficacy to switch from a topical solution to an ingestible one. While clinical studies and claims of product efficacy are in their infancy, there will be a rise in this concept and sales, as long as women truly see the results for which they’re looking. Look for more co-packaging of beauty products with ingestibles, as well.
7. From the Face to the Body
It used to be that mass bath and body brands were able to dominate by simply offering products that provided aromatic luxury and pampering at a low price point. To compete in this saturated market place today, mass brands are revving up and enhancing their formulations to include antiaging ingredients, which were once only reserved for facial products. For a one-year period ending March 27, 2007, Information Resources claims sales of antiaging body care products in U.S. supermarkets, drugstores and mass merchants (excluding Wal-Mart) rose more than 6% to $26.7 million. Clearly, huge opportunities exist in this segment.
8. Procedures No Longer Hush-hush
Plastic surgery patients in the U.S., unlike patients from other countries, still remain relatively hush-hush when it comes to frank, open talk about their personal, cosmetic procedures. In recent years, however, more and more Americans have become familiar and more comfortable with the topic—thanks in no small part to mass advertising and availability. Gone are the days of sneaking off to an obscure location for a little nip/tuck; instead, consumers openly brag about their latest injection of Restilin and obsess over TV shows such as Dr. 90210. The stigma of antiaging procedures such as Botox, microdermabrasion and facelifts is no longer there. Women as young as ages 18–29 openly admit they’d be willing to consider antiaging procedures for prevention or correction. A continued marriage of nonsurgical and surgical procedures and the growth of topical skin care extension product lines for use post-procedure is expected.
9. Growth of the Retail/Salon Channel
As the holistic view of beauty and wellness continues to pervade the news media and find shelf space in retail channels, the salon channel is one that will continue to sneak upward in importance for selling skin care. According to the ISPA 2006 Report on Spa-goers Study, 17 million Americans received a facial at a spa in 2005, ranking as the second most popular spa service after body massage.
Skin care services at spas, namely facials, have increased 24% in popularity since 2003. Combined salon/retail outlets are booming as women find their new hub for complete relaxation and pampering—along with prestige skin care supplies. That said, opportunities for distribution and expansion of these types of free-standing salon/retail outlets exist in niche markets.
10. Science in a Bottle
Women are increasingly insistent that their skin care products be dermatologically approved, and there’s a saying, “Hope in a jar has given way to science in a bottle.” She’s impressed with founders who have medical, dermatological or other clinical credentials, hence the growth in “doctor” skin care brands. Having an impressive credential will get her to try a product at a premium price, but for her to keep buying it, it needs to provide results better than non-doctor brands or procedures. Otherwise, she won’t buy it at any price.
11. Delivery Systems of the Future
To effectively deliver actives to the skin, cosmetic formulators can choose from a wide variety of systems. One of the newest, and most controversial, are nanoparticles—particles so small that their size is measured in nanometers, or billionths of a meter. The personal care industry was one of the first to successfully commercialize nanotechnology and figure out how to use it to enhance beauty products. When manipulated, these nano-sized agents have many cosmetic benefits due to the ease with which they infiltrate the body. They can potentially deliver any active ingredient, including those in antiaging, anti-acne, moisturizing products and over-the-counter pharmaceuticals for greater efficacy.
Nanotechnology is seen as a promising new technology if handled judiciously in carefully formulated products. However, there is already a movement underway to have the U.S. Food & Drug Adminstistration to regulate engineered particles more rigorously. Stay tuned!
12. Buy Me. I’m Free of …
What’s not in a woman’s skin care and cosmetic product is just as important as what is in it. Hypoallergenic is still a key buzzword for her and a term she finds desirable on her skin care label. And she is looking for more on a product’s “non-ingredient” list—phrases such as paraben-free, fragrance-free, hydroquinone-free and noncomedogenic—terms that make her feel comfortable enough to give a product a try.
13. “Me” Skin Care to “Family” Skin Care
Since mothers are the primary purchasers of their family’s personal care needs, it’s no accident that their growing interest in natural and organic beauty care products has spilled over to their choices for their families. Baby care, in particular, has benefited. According to Euromonitor, while birth rates remain steady, baby skin care products are skyrocketing, reaching sales of more than $220 million since 2006. Baby sun care products are predicted to grow another 16% by 2011.
The line between a mass-market brand and a prestige brand continues to blur, with mass-market brands hyping claims of product superiority through advanced technologies and proven “clinical” brands. Drugstore beauty aisles are becoming more upscale with displays of exclusive brands and previously not-offered beauty services, giving them more of a prestige feel. Department stores are doing all they can to remain relevant to the masses while still offering a younger, hipper version of prestige, as the recent JCPenney/Sephora partnership suggests. While prestige skin care sales remain highly profitable and command a huge segment of the market, this trend is making prestige skin care brand marketers nervous, and for good reason.
Alisa Marie Beyer is CEO of The Benchmarking Company (TBC), a research and branding firm focused on the beauty industry. TBC’s women-only, permission-based Pink Panel provides beauty consumer data for the award-winning Pink Report, the quarterly research report that reveals what consumers of female beauty products want, what they’ll buy and why. E-mail: [email protected]; www.benchmarkingco.com