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Introduction
The beauty industry is not as pretty as it used to be; it’s prettier. Every year, hundreds, if not thousands of
new products hit the market, but no longer are these products only coming from the tried and true industry
leaders we all know and love – Chanel, Lancome, Estee Lauder and Clinique. These days, everyone is
throwing their hat into the beauty ring: celebrities, reality TV stars, musicians, fashion designers, makeup
artists, dermatologists, estheticians, clothing and shoe retailers, non-profits, and even tattoo artists! All want
to tap into the glamour and excitement of our industry, and all enter into the game thinking their idea/product/
brand is the unique game-changer consumers have been waiting for. However, when you consider that up to
95% of new product launches fail each year (Source: AccuPoll); 80% of new brands fail (Source: Ernst &
Young), and only about 15 – 20% of new brands and products are actually successful (Source: Procter &
Gamble), we can see that clearly, something has got to change. The beauty pie isn’t growing and we are
dangerously close to over-saturation – which is why knowing and understanding the trends that affect us all
in this chock-a-block sea of competition is absolutely critical.
These days, the beauty industry is embracing trends in technology, ingredients, retail channels and even
lifestyle choices that in the not so distant past, we might never have considered.
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But what is a trend?
A trend articulates values which are ascending in
society. They can be physical or psychological. A
state-of-mind or a product. Social or Personal. And
they bring about changes that are long-term and
lasting. (How long ago was it that you had a paper
map in your car? Not long). Often, trends are
confused with fads. A fad is a short-term cultural blip
that is fun, yet may not lead to any sort of deep,
lasting cultural change. (Trucker hats and Cabbage
Patch Dolls anyone?) I’m here today to talk about the
top micro and macro beauty and cultural trends that
are deeply affecting women’s lives, and that ultimately,
will help guide our industry through the inevitable
changes that are heading our way in the face of so
much competition and innovation.
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TBC Beauty Facts, Figures,
and Trends
January 2011
Worldwide Cosmetic
Market
• The global cosmetic and toiletries market
was roughly $350 billion in 2009.
Lee, Virginia. “Opportunities in the US Beauty Industry.” Euromonitor International presentation at COSMOPROF. 7/18/10.)
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Weil, Jennifer. “Beauty’s Top 100.” WWD.COM. 8.13.10. < http://www.wwd.com/beauty-industry-news/the-wwd-beauty-biz-top-100-3210830>
Cosmetic Product Categories
Now that you know where all the money is spent, it’s helpful to know what people are
spending their money on. The cosmetic industry (aka beauty industry or personal care
industry) can be broken down into 5 categories with sales distributed as follows:
Skin Care The range of products that are offered for the skin care market are much more
diverse than the hair care market. Skin care includes skin moisturizers, cleansers,
facial products, anti-acne, and anti-aging products. The biggest companies in this
market include Procter & Gamble (Olay) and Unilever (Vaseline).
Make-up The color cosmetic market includes anything from lipstick to nail polish. Included are
things like blush, eyeshadow, foundation, etc. The array of products is vast and the
number of color variations are practically infinite. The market is highly segmented so
there isn’t really one dominant player. Maybelline and Clinique are just a couple of
significant brands.
Personal Care The “personal care” category represents 23% of the cosmetic industry and is
made up of things like toothpaste, deodorants, sunscreens, depilatories, and
other personal care products not yet mentioned. The dominant companies are
many of the same already mentioned, P&G, L’Oreal, and Unilever.
Spa Services The spa services industry in the US includes about 18,000 facilities with
combined annual revenue of more than $13 billion.
• Major spa services companies include destination spa chains Canyon Ranch
and Golden Door, massage clinic franchise Massage Envy, as well as day
space franchise Woodhouse Spa.
• The industry is highly fragmented: most spa services companies operate a
single facility with less than $1 million in annual revenue.
Cosmetic Retail Market The cosmetic, beauty supply, and specialty store industry includes
about 13,000 stores with combined annual revenue of around $10
billion.
• Major companies include Sally Beauty Supply, Ulta, Sephora, and
divisions of Limited Brands (Bath & Body Works) and L’Oreal (The
Body Shop International).
• The industry is concentrated: the top 50 companies have almost 75
percent of industry revenue.
Estée Lauder and rival L'Oréal have realized that, like the spirits industry, the key to
success lies in offering a suite of products targeted at a wide range of customers, but
with special emphasis on the growing luxury sector.
Firms are listed by their parent companies and ranked by beauty sales for the 2009 calendar year. For this list, "beauty" includes fragrance, makeup, skin
care, sun care, hair care and deodorant, plus cellulite and shaving products. It does not comprise bar soaps, razors, toothpastes, foods and diet foods,
medicines, vitamins or detergents. Beauty revenues only comprise sales of beauty products each firm manufactures and do not include business from
private label lines or products it might distribute for other firms.
Lennard, Carrie. “Masculine Dynamism—Men’s Care Growing Fast”. 12/6/10. GCI Magazine. December Issue. < http://www.gcimagazine.com/marketstrends/consumers/men/
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111394189.html>
Consistency is Key
Differing from other categories, beauty has
been the most consistent throughout the
economic downturn and recovery.
Face and Nails were standout segments, outperforming the total make-up category.
Face, the largest segment with 49 percent dollar share of makeup, grew 3 percent in dollar volume, versus
last year. Concealer (+6%), Foundation (+3%), and Blush (+2%) helped lead the way.
The Nail segment, the smallest makeup segment, with only one percent dollar share, grew a double-digit 31
percent year-to-date (Jan thru Aug.) 2010, compared to the same time last year.
Both the Lip and Eye segments showed positive growth as well.
Lip and Eye segments grew two and one percent respectively. The sub-segments driving growth in the Lip
and Eye categories were Lip Color (+8%) and Eye Liner (+3%).
“Prestige Makeup Sales Shine in U.S. department stores: Face and Nail Categories are Biggest Standouts in Makeup”. 12/14/10. <http://www.cosmetic-business.com/en/
showartikel.php?art_id=2266>
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2010 Winners & Losers
• Only 31% of women say that their makeup buying
behavior hasn’t changed as a result of the economy.
Still, these changes have not effected all companies
equally.
• Of the major publicly traded cosmetics companies,
only Estee Lauder Companies has been able to
rebound strongly since the downturn began in October
2007 (up 48 percent over the past three years).
Cavallero, Matt. “Cosmetics Stocks Will Make Your Eyeliner Run”. 10/1/2010. < http://blogs.forbes.com/greatspeculations/2010/10/01/cosmetics-stocks-will-make-your-eyeliner-run/>
"The eyes have it! Eye makeup sales bolster color cosmetics growth, reports Mintel” 7/2010. <http://www.mintel.com/press-centre/press-releases/562/the-eyes-have-it-eye-makeup-
sales-bolster-color-cosmetics-growth-reports-mintel>. 18
Succeeding in Beauty
Only a very small percentage of new beauty products and brand introduced into the market
each year are successful. The experts offer different explanations as to why:
• According to Procter & Gamble CEO A.G Lafley, “In our industry, only about 15 to 20 percent of new brands and
products really succeed. Every year from 2000 through 2007—the last completed fiscal year virtually all of our
incremental growth has come from innovation. One of the things we try to understand is … what's the real pace of
innovation that's right for the consumer, right for the retailer and right for us.”
• According to research agency AcuPoll, “As many as 95 percent of new products introduced each year fail.”
• According to Ernst & Young,, “Upwards of 80 percent of new brands fail and the primary reason is a lack of
differentiation from competitors.”
• According to Marketing Corporation of America, “LLine extensions have a failure rate of 49 percent, while 74 percent of
more innovative products fail. Reasons for new product failure include: A value proposition that is not sufficiently
compelling and/or awareness and trial is not generated by marketing.”
• According to the Americian Association of Advertising Agencies, “In the highly-competitive consumer goods market,
the success of a new product is the hard-earned result of streamlining innovation processes and supporting them with
experienced, dedicated people and enabling technologies. About 75 percent of new products fail and that number
may be even higher in a recessionary environment.”
Cavallero, Matt. “Cosmetics Stocks Will Make Your Eyeliner Run”. 10/1/2010. < http://blogs.forbes.com/greatspeculations/2010/10/01/cosmetics-stocks-will-make-your-eyeliner-run/>
"The eyes have it! Eye makeup sales bolster color cosmetics growth, reports Mintel” 7/2010. <http://www.mintel.com/press-centre/press-releases/562/the-eyes-have-it-eye-makeup-
sales-bolster-color-cosmetics-growth-reports-mintel>. 19
Miles, Lynn. “New Products, Facts, and Stats.” 6/607. Research Matters #6757. <http://www.aaaa.org/news/bulletins/Documents/ResearchMtrs.pdf>
Make-up Usage, Motivation,
& Purchase Behavior
Daily Makeup Usage
• Average woman spends 20 minutes a day applying makeup.
• 4 out of 5 women wear makeup.
• 76% use lip gloss and lipstick Moisturizing (54 percent) and SPF (51 percent)
are the most popular skin care benefits in
• 65% of respondents report using mascara makeup products. These were followed by “oil-
• 63% of women report wearing eye shadow free-won’t clog pores” (32 percent); “reduces
• 62% use eye liner wrinkles-fine lines” (30 percent) and items that
are natural or mineral-based (27 percent),
• 38% use brow pencils according to the report.
• 22% use lip pencil • Only one million women, based on census
• 7% use compact lip color projections, are wearing only one makeup
• 86% of makeup users have used makeup product a day.
that features skin care benefits in the past
year.
“The eyes have it! Eye makeup sales bolster color cosmetics growth, reports Mintel” 7/2010. <http://www.mintel.com/press-centre/press-releases/562/the-eyes-have-it-eye-makeup-
sales-bolster-color-cosmetics-growth-reports-mintel>.
"How much will you spend on makeup in your lifetime?”. 3/12/10. <http://www.bellasugar.com.au/How-Much-Women-Spend-Makeup-Life-7708228>.
Evans, Michael. “NPD Report Shows Decline in Makeup Usage”. 8.18.10. http://www.wwd.com/beauty-industry-news/npd-report-shows-decline-in-makeup-usage-3223228.
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Make-up Usage, Motivation,
& Purchase Behavior
Emotional Connection/Motivations
• Nearly half of U.S. women surveyed believe wearing makeup gives them an advantage
at work and makes them feel more in control
• 82% of women surveyed believe wearing makeup makes them feel more self-confident
• 86% of women believe that wearing makeup improves their self-image
Shopping Habits
• Average woman spends $15,000 on makeup in her lifetime.
• From the ages of 16 to 65, a woman shops for cosmetics about five times a year.
• Each time she’ll spend roughly $43, equaling about $216 a year.
• That’s about $2,750 on eye shadow, $1,780 on lipstick and $3,770 on mascara in total
• The average U.S. consumer spent $616 on personal care in 2008
“L'Oréal Survey Reveals Beauty Habits in the Face of Recession”. 8/31/09. GCI Magazine. < L'Oréal Survey Reveals Beauty Habits in the Face of Recession>
"How much will you spend on makeup in your lifetime?”. 3/12/10. <http://www.bellasugar.com.au/How-Much-Women-Spend-Makeup-Life-7708228>.
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Micro Beauty Consumer Trends
Now that you know the intimate details of the beauty industry in general, let’s look at 20
of the hottest micro beauty trends for 2011. Micro beauty trends are quick, often
seasonal trends that spring from the runways and fashion houses, top makeup artists,
industry leaders, regular women on the street, and these micro-trends help guide
consumers as they make their day to day beauty and fashion decisions.
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Skin
Minimal, Fresh, Age-Reversing, Proven, Clinical
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Color
Bold, Bright, Juicy, Beautiful, Glowing, Healthy
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Hair
Sunny, Smooth, Shiny, Long & Inviting,
Exotic Ingredients
1. Bright, sunny and inviting blonde shades took
center stage on runways from coast to coast.
2. Long, wavy, hippie-inspired tresses that are either
stick-straight or imbued with soft body are a breath
of spring energy.
3. Side-parts are hot. Hair is swept low over the
forehead, and pinned on one side with large,
gorgeous barrettes and pins.
4. Perm performance! The age of the perm is back,
only – it’s not the perm of your youth. Today’s perms
leave behind soft curls, soft body and even better?
Soft hair.
5. Exotic singe-note ingredients to keep hair soft and
silky this year are: bamboo, wild ginger, and French
plum.
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Fragrance
Classic, Breath-taking, Fresh, Personalized, Vintage
4. Fragrances for people who don’t want to smell like they are
wearing perfume will continue to hold market share.
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TREND #1
Best-tige
Luxury beauty brands are redefining themselves.
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TREND #3
Subdivisions
Masstige color brands are closing the great divide.
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TREND #4
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TREND #5
Entitlement
Youth-on-demand. (aka – looking
young is my right.)
Mirror, my mirror
We are seeing our reflections in a whole new light
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TREND #7
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TREND #8
Nailed
The trendiest accessory on every woman’s
hand isn’t her jewelry – it’s her nail polish.
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Cultural Macro Trends
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TREND #1
Outsourcers-R-Us
It takes a lot of help to live our lives, and we
aren’t about to trade-down
The economy may still be recovering, our 401k’s may have lost
some of their cushioning, our budgeting on food and
entertainment may have become more mainstream than not,
but one place where we aren’t going to budget? Our
outsourcing. These days, most of us have ‘people’. Someone to
clean our houses, mow and maintain our lawns, do our taxes,
watch our kids, fix our cars, grow our wealth, put us through
our gym paces, and even keep us sane, and we view them all
as necessary, normal and needed extensions of our daily lives.
And while some may view this type of help as extraneous, for
the majority – it’s rapidly becoming a way of life, and we won’t
compromise on affording it, regardless of our financial
circumstances. We may be broke as a joke, but Merry Maids
will be at our house four times a month keeping our lives (and
us!) in order.
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TREND #2
Me-moments.
She’s got an exit strategy, and she doesn’t
feel badly about it.
It used to be that Calgon was how women got away from it all,
but as I think we can all agree, that ship has sailed. Today, it’s
about me-moments – carving out ‘me-time’ that is more
meaningful than just a bubble bath (not that those aren’t
meaningful in their own way). Instead, women want moments to
themselves that are impactful and give us back a sense of
peace, of purpose and of passion. What would have been
unheard of in the past is now a trend for the present – exit-
strategizing: women re-claiming time for themselves at the
expense of friends, family and even responsibility. Separate
vacations, book clubs or women’s groups, weekend days that
are dedicated ‘mommy-free zones’ are just a few of the ways
that women are mindfully (and thoughtfully) severing
themselves from their ever-growing list of responsibilities –
even if only for 5 minutes – and reclaiming a sense of self and
of ‘me’.
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TREND #3
Home Base
Even in the big city, we are becoming
local-yokels.
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TREND #4
Self-renovation Fascination
Every minute of every day, we aren’t just
someone new, we are someone better.
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TREND #5
Rolling Holy
The rise of the new religion and
how it’s going to save us all
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TREND #7
Choice Ladders
We still want what we want, only now – we
are valuing these choices differently.
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TREND #8
Extremes-no-more
Why the extremes are no longer our friend.
In a world where reality stars get paid $25,000 to walk into a party, athletes behave as unsportsmanlike as possible,
and political-correctness has reached new levels of absurdity, there is a refreshing turn back to status-quo, middle-
ground, good-old-fashioned un-excitement. The excesses of the past few years, coupled with the economic
downturn has made extreme behaviors, extreme diets, extreme houses, extreme salaries…extreme anything just
seems like too much, and culturally – it’s no longer appealing. And rather than being viewed as a dull or boring, this
migration back to the more stable middle-ground is instead inspiring us to set parameters, take responsibility and
ultimately again start achieving goals that in an environment of extremes, we could never achieve.
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TREND #9
Constant Connection
Technology has advanced every aspect of our lives to a
critical state of constant connection.
At the beginning of the movie “Jerry Maguire”, Tom Cruise’s character, Jerry Maguire,
famously promises his client that he, “…will not rest until I have you holding a Coke,
wearing your own shoe, playing a Sega game *featuring you*, while singing your own
song in a new commercial, *starring you*, broadcast during the Superbowl, in a game
that you are winning…”. And while the potential for this kind of situation was radical in
1996, the truth is that in 2011 – all of us are this connected, and more. On any given
day, there are 90 million tweets tweeted, 35 hours of video uploaded per minute, 1.6
million blog posts posted, and an average of 130 friends demanding our attention. We
are wired and plugged in 24/7, and anything (and everything) we could ever possibly
want is almost instantly available to us. Want to watch a DVD, check the weather, catch
up on the game, call your mom, send an email and tag some photos of yourself in
Facebook all while sitting on your couch? No problem. With today’s technology, you can
do all of this simultaneously in about 5 minutes flat, and the demand for this kind of
constant connection is only going to grow. Young children and teenagers have grown
up with this as their ‘norm’, and even retirees are jumping on-board, realizing that being
able to sync multiple areas of your life concurrently is addicting. But as with everything,
what goes up – must come down. Our technology addiction may be on the rise, but
what will cause us to start tapping out? Will we simply become too connected?
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TREND #11
When the economy took a turn in late 2008, most all of us took
a look at our spending habits and adjusted accordingly,
including the affluent shopper. She spent more time
comparing her options, more time online researching her
purchases, and like all of us – spent less of her dollars on
favorite items. Today, she’s reverting back to her former
purchasing habits: comparing less, and buying more. In
particular, more of her favorite brands. Throughout the last two
years, even though affluent shoppers purchased less, they
remained loyally committed to their favorite brands. And now
that many of us are beginning to shop again, this affluent
consumer is leading the way, and flocking back to her favorite
high-end, designer products with her wallet open. And
although a retail comeback may take a bit longer to kick-in for
non-affluent shoppers, we believe all segments will again
return to their loyal brands and start spending.
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