At a joint press briefing at in-cosmetics Global on 4 April, Euromonitor International revealed the latest insights into the beauty industry. According to the company’s data, premium beauty will generate an additional US$20 billion of revenue by 2021, as it continues to be the driving force behind the global beauty industry.
Driven by the US and Chinese markets, which are expected to account for 54 percent of the market by 2021, growth in premium products in the main segments exceeded that of mass- produced products last year.
In colour cosmetics, premium products achieved an impressive CAGR of 8.6 percent, while mass products trailed at 6.5 percent. Premium skin care and hair products also performed well with CAGR of 5.2 percent and 5.3 percent respectively, ahead of mass market competitors on 4.6 percent and 3.5 percent.
While premium products are outperforming mass market ones in the larger beauty categories, in the fragrance category mass products dominated in Brazil in 2016.
Euromonitor also highlighted the growing consumer trend for ‘less is more’, stressing that beauty is being reinvented, with healthy living, premiumisation, experience, green living and connectivity at its heart.
Irina Barbalova global lead, beauty and personal care research at Euromonitor, comments: ‘We have seen some interesting trends develop over the course of 2016 and expect to see more cross-industry movements to provide further opportunities in the future. The apparel, food and drink, consumer health and electronics sectors are all inspiring innovation in beauty.’
Heritage brands are being challenged by regional brands, while traditional brands are being rewarded for their personalisation efforts. Barbalova says there is an influx of more and more health-oriented brands and derma-inspired brands in the personal care space as consumers continue to shift their preferences towards brands that are lifestyle orientated.
The anti-ageing category is transitioning into facial wellness, with a strong focus on products positioned at derma-healing and skin renewal. Barbalova says its moving from its traditional focus on skin aesthetics to a more lifestyle beauty orientated category.
The digital era is putting the power in the hands of the consumer, from a time investment, monitoring and personalised support basis. Consumers are using apps to invest in and monitor their health, and brands focused on offering solutions within the wider health and personal care portfolio will be truly lucrative going forward.