Alternative Revenue Focus | Monday, June 20, 2011
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Women Spend More On Fragrance, Downscale Nails

Women are spending more on most beauty categories, but a new report shows that they are continuing to criss-cross between mass and prestige brands.

Total U.S. beauty sales are up 5% in prestige products in the first quarter, and 4% in and food/drug/mass channels, according to the latest NPD/SymphonyIRI Beauty Cross Channel Monitor.

In fragrance sales, prestige brands -- those sold in department stores -- gained 6% for the quarter, while mass brands were flat. (Prestige perfume usually accounts for roughly five times the dollar sales as mass brands.) In makeup, though, food/drug/mass channel faring better than prestige, "due in part to the double-digit sales in the $127 million nail segment," the report says.

"Despite the current economic situation, the beauty industry continues to trend upward showing growth for the fourth consecutive quarter in both the food/drug/mass and prestige channels," Diane Nicholson, president of beauty for the Port Washington, N.Y.-based NPD Group, writes in the release. "After a positive, yet cautious 2010, it's encouraging to see consumers continue to embrace newness and innovation in the beauty space."

And there are indications women will continue to beef up their beauty bags in the months ahead. NPD's Economy Tracker finds that 35% of those it surveyed intend to either maintain or increase their spending in cosmetics and fragrances, up 2% from last year at this time -- even given increases in gas and grocery prices.

While the mass skincare market is typically three times the size of prestige skincare, higher-end products grew by 6%, versus 3% for mass. The report says that increase, driven by suncare, giftsets and face products, that the beauty consumer is doing more channel shifting. "Capitalizing on the dynamics between these channels is a critical component to maximizing brand strategies."

(Source: Marketing Daily, 06/16/11)

What's In It For You:
Though women are increasing their spending on "small indulgences," the competition for those dollars -- and hopefully, ensuing brand preference -- is still quite fierce. L'Oreal and Revlon have been active in clever sampling programs, with private "House Parties" being all the rage. Other bands are emerging as smaller players in event sponsorship, creating on-site activation elements encouraging women to "test drive" blushers, eye shadows, face creams, and lipsticks at events. And digital marketing efforts, including online coupons (often in partnership with retail chains such as CVS and Walgreens) are surging. Find the distributor or manufacturer's rep in your market and see what regional dollars can be put to results-driven use with your station.



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