Vol. 130, No. 7 | September 2015 Cosmetics & Toiletries® | 9
oil-based products are entering a wide range of
beauty categories beyond hair and body oils into
cleansing products, serums and color cosmetics (e.g.,
YSL Volupté Tint-In-Oil).
Demand for individually tailored solutions, the
ultimate customization, is on the rise. New product
developments are aligned with the trend, such as
Clinique Smart Custom Serum, launched in 2014.
3. New Lucrative
Opportunities in Skin Care
The global retail value of skin care exceeded
$110 billion in 2014, registering more than 5%
growth. Customization remains a key trend across
all beauty categories, but it is driving especially
prominent growth in skin care due to the wide
range of functions, benefits and claims the category
Within skin care, facial care products will be the
most prospective growth generators. New lucrative
market niches will include face masks, anti-aging and
men’s skin care. Diversification of claims and formats
for face masks is expanding both across Asia and
In 2014, Asia-Pacific still accounted for 80% of
the global facial mask market. However, the category
has registered 15% growth in the United States, and
the frequency of face mask application is growing
in large European beauty markets, such as France
New sheet formats should create further interest due to more complex demands and evolving
4. Growing Demand for
Although growth was still modest in 2014 in
developed markets, beauty companies aim to capture
demand for “niche.” This trend is reflected in the
intensifying acquisition activities among strongly
performing niche brands, especially in skin care
Niche brands have the advantage of a more
personalized offering, unique features and benefits,
and are highly specialized in their focus categories.
5. Digitally Engaged
Niche opportunities beyond dynamic categories
and exclusive brands are available via a growing
number of niche retail platforms.
Traditional beauty retailers are developing their
online presence in order to succeed among the growing competition for consumers.
Simultaneously, pure e-tailers, e.g. Amazon and
eBay, have long-established infrastructure and the
know-how of online trading, but the competition
facing them is growing from a myriad of mobile apps,
social media and company websites.
The Internet retailing channel in beauty and
personal care is still relatively underdeveloped,
accounting for about 5% of total sales in 2014, but
it registered the fastest growth over the 2009–2014
review period with a 17% compound annual growth
Consequently, companies have been making significant investments into expanding their
There are a number of focus points for these
growth initiatives, including brand building, consumer engagement, beauty habit analysis and, most
importantly, online retail platforms to capture new
sales. As a result, the digital market space in beauty
is becoming highly fragmented; the development
of sound digital strategies is a necessity to capture
Cautiously Optimistic Outlook
The outlook for global beauty is cautiously
optimistic, near 3% CAGR at constant 2014 prices
over 2014–2019. Despite the slowdown in China and
Brazil, there is still huge potential to grow beyond
first-tier cities and to expand the penetration of existing flagship brands.
India remains at a nascent stage of its development with average disposable incomes at much lower
levels than China or Brazil. However, given the sheer
size of its rural population (860 million in 2015),
and a predisposition toward skin care, even a small
increase in wealth could yield a highly significant
upside for the skin care category.
Meanwhile, Indonesia will increase its contribution compared to the previous five years, with a major
boost from skin care.
The diversity of trends is expected to evolve under
the growth pillars of customization, digital and niche
opportunities in 2015 and beyond.
Editor’s Note: Read these full market reports in GCI
magazine or visit www.GCImagazine.com.